Treasurer Tim Pallas denies VicRoads privatisation

VicRoads is set for a major shake up, with plans for a new “joint venture” with the private sector— but the move will not result in privatisation.

Treasurer Tim Pallas has denied VicRoads private sector shake up would result in privatisation.

But he conceded the government would hope to receive some form of payment if a bid was successful.

Earlier the Herald Sun revealed the Andrews Government was set to announce plans that VicRoads’ licence and registration agency would move into a “joint venture” with the private sector.

The treasurer was expected to announce the move on Thursday, with staff this morning informed of the decision, but clarified reports on Friday.

The private operator would be tasked with investing heavily in the VicRoad’s IT system to modernise it and make sure it can be accessed by other areas of government such as Victoria Police.

Learner’s permit tests and other services could move online in an effort to bring VicRoads into the 21st century.

Victorian Treasurer Tim Pallas denies the VicRoads move would result in privatisation. Picture: NCA NewsWire / Ian Currie.

In return, it would likely sign a concession for the next 40 years in which it would receive a share of the revenue from licenses and registration.

“This is not a privatisation in the sense that we are going to remain the owners of this asset,” Mr Pallas said.

“We’ve had many governments over many years, of all differing political complexions, who have talked about delivering an improved registration and licensing system but haven’t ever delivered on it.

“Practically speaking, the private sector are much better at delivering this, they are also much better at being responsive to customer needs.

“Frankly you’ve got an IT service that is struggling at the moment.”

Mr Pallas said now was the right time for the move because investors were looking for secure places to park their cash while interest rates are low.

He also said he did not believe the move would lead to job losses.

“We actually expect in the short term about 100 jobs in this area,” he said.

“Those jobs will be in higher skill provision by our joint venture partner who will be upgrading and improving the IT systems in VicRoads.”

Roads Minister Ben Caroll said the pandemic had shown more services, such as learner’s tests, needed to be shifted online and a modern system was needed.

“I saw first-hand how our services, and our staff worked so hard to clean the backlog that we had for registration and licensing,” he said.

“But I also saw the experience and the frustration, particularly for young Victorians who we often classify as digital natives, that they were sort of stuck at home and couldn’t do their learner’s test online.

“I’m very committed to ensure that this is a really important opportunity that’s seized upon to ensure its customer focus and customer led.”

But Greens transport spokesman Sam Hibbins said the move was “just another privatisation”.

“Neoliberalism is alive and well in the state of Victoria and the Victorian Labor government is addicted to privatisation,” he said.

“It’s time we had a debate on our state’s economic ideology before every public asset that turns a buck is sold off by this government.”

VicRoads is set for a major shake up with the Andrews’ Government to announce plans for a joint venture with the private sector. Picture: Nicole Garmston

The move comes after more than a year of speculation over what would happen to the division which was kept separate from the Department of Transport merger.

Companies will be asked to develop market proposals before a final call is made late in 2021.

The new structure would keep fees and other key powers within the government but allow companies to modernise the current dated registration and licence system.

It is not yet clear what sort of financial windfall the new deal would bring for the government, and what impact the changes would have on staff.

The Australian Services Union on Thursday lashed out at the government and called it a betrayal of workers and motorists.

State secretary Lisa Darmanin said there was now a risk of lower wages and conditions.

“We fear this part-privatisation will see staff slashed, services fall, prices increase and be a genuine risk to the privacy of license holders in Victoria.”

“No other State government in Australia has part-privatised a road traffic authority.

“Victorians should not be the guinea pigs testing the impact of private sector partnerships on the delivery of such an essential service.

“Members of the Andrews Government, including Dan Andrews, Tim Pallas and Ben Carroll, know the terrible impact that privatisation has had on Victorians. We deserve better than a Labor Government following in the steps of Jeff Kennett.”

“Nobody voted for Dan Andrews thinking he would privatise an essential government regulatory service, and the whole labour movement opposes the privatisation of VicRoads.”