Managing The Environmental Impacts Of Transport

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Managing the Environmental Impacts of TransportManaging the EnvironmentalImpacts of TransportAugust 2014Victorian Auditor-General’s ReportTelephone 61 3 8601 7000Facsimile 61 3 8601 7010www.audit.vic.gov.au2014–15:3Level 2435 Collins StreetMelbourne Vic. 3000August 20142014–15:3

VICTORIAVictorianAuditor-GeneralManaging theEnvironmental Impactsof TransportOrdered to be printedVICTORIANGOVERNMENT PRINTERAugust 2014PP No 347, Session 2010–14

Photo attributionsPage 1 – Korkusung/ShutterstockPage 9 – Neale Cousland/ShutterstockPage 22 – Marcus Wong/Wikimedia CommonsPage 31 – TK Kurikawa/ShutterstockPage 40 – courtesy of Public Transport VictoriaPage 48 – Bernhard Richter/ShutterstockThis report is printed on Monza Recycled paper. Monza Recycled is certified Carbon Neutral by The CarbonReduction Institute (CRI) in accordance with the global Greenhouse Gas Protocol and ISO 14040 framework.The Lifecycle Analysis (LCA) for Monza Recycled is cradle to grave including Scopes 1, 2 and 3. It has FSC MixCertification combined with 55% recycled content.ISBN 978 1 922044 93 8

The Hon. Bruce Atkinson MLCThe Hon. Christine Fyffe MPPresidentSpeakerLegislative CouncilLegislative AssemblyParliament HouseParliament HouseMelbourneMelbourneDear Presiding OfficersUnder the provisions of section 16AB of the Audit Act 1994, I transmit my report on theaudit Managing the Environmental Impacts of Transport.The audit assessed how well the Department of Transport, Planning and LocalInfrastructure (DTPLI) is fulfilling its strategic leadership role and how well VicRoadsand Public Transport Victoria (PTV) are managing the environmental impacts oftransport.I found that DTPLI did not adequately fulfil this role when developing the state'sstrategic transport and land-use planning framework. This is because it did not providethe government with any specific advice on how proposed actions would address theenvironmental impacts of transport, nor did it propose any statewide objectives ortargets for reducing transport-related greenhouse gases, other emissions and noise.VicRoads has a comprehensive plan for improving the environmental performance ofthe road system, and this is a model of what should exist on a portfolio-wide basis.PTV, on the other hand, does not have a dedicated plan and its performance in thisregard has declined since our previous audit, Public Transport Performance.I have made a series of recommendations aimed at addressing these issues. I amencouraged by the commitment of VicRoads and PTV to implementing actions againstthese recommendations, and encourage DTPLI to fully embrace the recommendationsof this report.Yours faithfullyJohn DoyleAuditor-General20 August 2014Victorian Auditor-General’s ReportManaging the Environmental Impacts of Transportiii

ContentsAuditor-General’s comments . viiAudit summary . ixBackground . ixConclusions .xFindings . xiRecommendations . xvSubmissions and comments received . xvi1. Background . 11.1Introduction . 11.2Snapshot of the Victorian transport system. 51.3Options for reducing transport emissions . 71.4Managing environmental impacts within the broader transport system . 101.5Audit objective and scope . 121.6Audit method and cost . 121.7Structure of the report . 122. Statewide strategic planning and reporting . 132.1Introduction . 142.2Conclusion . 142.3Statewide strategic planning . 152.4Statewide governance and monitoring arrangements . 233. Managing road and public transport impacts . 273.1Introduction . 283.2Conclusion . 283.3DTPLI . 293.4VicRoads . 313.5PTV . 353.6Transport for London's approach to reporting . 40Victorian Auditor-General’s ReportManaging the Environmental Impacts of Transportv

Contents4. Impacts of recent agency initiatives . 434.1Introduction . 444.2Conclusion . 444.3DTPLI initiatives to improve environmental performance . 454.4Initiatives to manage the environmental impacts of the road system . 474.5Initiatives to manage the environmental impacts of thepublic transport system . 51Appendix A. Audit Act 1994 section 16—submissions and comments . 55vi Managing the Environmental Impacts of TransportVictorian Auditor-General’s Report

Auditor-General’s commentsThe Victorian transport system produces significant amounts of greenhouse gases,other air pollution and traffic noise that pose a growing threat to our environment andhealth. Minimising these impacts has been a legislated objective since the TransportIntegration Act 2010 (the Act) was introduced in July 2010.Under the Act, the Department of Transport, Planning and Local Infrastructure (DTPLI)has the key leadership role to ensure the transport system is delivered consistent withtransport system objectives. The Act requires DTPLI to establish the overarchingplanning framework within which other transport bodies are to operate. It also requiresPublic Transport Victoria (PTV) and VicRoads to minimise adverse environmentalimpacts from the road and public transport systems, respectively, within the context ofthis framework.John DoyleAuditor-GeneralAudit teamSteven VlahosSector DirectorVerena JuebnerTeam LeaderHayley SvensonAnalystDaniel MahoneyGraduate AnalystDallas MischkulnigEngagement QualityDTPLI finalised the statewide strategic framework, consisting of Plan Melbourne,Victoria—The Freight State and the state's eight regional growth plans, in July 2014.The government has subsequently adopted this framework. However, my audit foundthat during the framework’s development, DTPLI did not adequately advisegovernment about how the proposed strategies would address the environmentalimpacts of transport. The framework also did not propose any statewide objectives ortargets for reducing transport-related greenhouse gases, other emissions and noise.As it does not clarify the environmental objectives it is seeking to achieve, DTPLI'sproposed strategic framework is largely aspirational. To increase the likelihood ofimproved environmental performance, DTPLI needs to set clearly defined expectedoutcomes and comprehensively report on progress against these.Across the three agencies examined, I found that VicRoads has the mostcomprehensive strategy for managing the environmental impacts of the road system.Indeed, its Sustainability and Climate Change Strategy 2010–2015 is a model of whatshould exist on a portfolio-wide basis. Encouragingly, this strategy includes specificactions and goals for reducing greenhouse gas emissions, improving air quality andminimising traffic noise impacts, and VicRoads regularly publicly reports on itsprogress.Conversely, I found that PTV has not sufficiently progressed options identified by theformer Department of Transport on how to improve public transport's energyconsumption and greenhouse gas emissions. Additionally, the quality and availability ofpublicly reported information on public transport's environmental performance hasdeclined since 2012.Control ReviewerVictorian Auditor-General’s ReportManaging the Environmental Impacts of Transportvii

Auditor-General's commentsI have made 11 recommendations to address the shortcomings identified by this audit.In particular, the recommendations reinforce the need for DTPLI to develop statewideobjectives and a related framework to monitor and report on the performance of thetransport system in meeting the Act’s environmental sustainability objective.I am disappointed by DTPLI's less than fulsome acceptance of my recommendationsfor it to develop a statewide strategy to address the environmental impacts of thetransport system. The Act makes it clear that DTPLI's role is to lead all of the strategicpolicy, advice and legislation functions relating to the transport system, and todetermine strategic policies that address related current and future challenges.As noted in my report, the environmental impacts of the transport system aresignificant and growing. Addressing this major challenge for the state's current andfuture generations, and proactively advising the government on potential policyresponses is clearly within the scope of DTPLI's obligations under the Act.The recommendations reinforce the need for PTV to develop a similar framework andto address the shortcomings identified by this audit and our 2012 audit. I alsorecommend that VicRoads develops arrangements to monitor and report on theenvironmental impacts of initiatives to improve traffic flow and the mode share of publictransport. Encouragingly, both PTV and VicRoads have accepted theserecommendations and have committed to address them.I look forward to receiving updates from these agencies on their progress inimplementing the recommendations.Finally, I would like to thank the staff of DTPLI, VicRoads and PTV for their assistanceand cooperation during this audit.John DoyleAuditor-GeneralAugust 2014viii Managing the Environmental Impacts of TransportVictorian Auditor-General’s Report

Audit summaryBackgroundVictoria’s transport system is vital for moving people, services and goods, withMelburnians making close to 14.2 million trips across the city each day. Consequently,the environmental impacts are significant and include the production of greenhousegas emissions, other air pollution and noise.The transport sector is the second largest producer of greenhouse gases in Victoria.Total emissions from this sector grew by 41.2 per cent from 1990 to 2012 andaccounted for 18.72 per cent of Victoria’s total greenhouse gas emissions in 2011–12.Passenger cars are responsible for approximately 60 per cent of Victoria’stransport-related greenhouse gas emissions. While total emissions from publictransport are significantly lower than from both passenger and freight vehicles, inVictoria trams and trains are particularly greenhouse gas-intensive modes as they relyprimarily on electricity produced from brown coal.Transportation noise is also of community concern, particularly in residential areas,where exposure to high noise levels can have adverse health and socialconsequences.Typical approaches for reducing transport emissions include:xreducing the demand for travelxincreasing the use of non-vehicular modesxleveraging new technologiesxreducing emissions from transport infrastructure.The Transport Integration Act 2010 (the Act) requires transport agencies to manage thetransport system in a way that actively contributes to environmental sustainability. Thisincludes minimising transport-related emissions, promoting less harmful forms oftransport and improving the environmental performance and energy efficiency of alltransport modes. This objective must be balanced with the other transport systemobjectives.Under the Act, the Department of Transport, Planning and Local Infrastructure (DTPLI)has the key leadership role in planning for and managing the transport system in a waythat addresses these objectives. VicRoads also has a role in minimising the adverseenvironmental impacts of the road system and Public Transport Victoria (PTV) has asimilar goal of seeking to improve the environmental performance of the publictransport system.Victorian Auditor-General’s ReportManaging the Environmental Impacts of Transportix

Audit summaryThis audit assessed whether the environmental impacts of transport are beingeffectively managed. It examined how well key institutional arrangements supportstatewide and agency-level strategic planning, monitoring and reporting for managingthe environmental impacts of transport, and the effectiveness of key strategies andinitiatives in reducing the impacts of transport on the environment.ConclusionsThe environmental impacts of the transport system are significant and growing.Minimising these impacts has been a legislated objective since 2010, but it is clear thatDTPLI has not adequately addressed this when developing the state's strategictransport and land-use planning framework (the strategic framework)—consisting ofPlan Melbourne, Victoria—The Freight State (VTFS) and the state's eight regionalgrowth plans (RGP).During the strategic framework's development, DTPLI did not provide the governmentwith any advice about how proposed strategies would address the environmentalimpacts of the transport system. It also did not propose any defined statewideobjectives or targets for reducing transport-related greenhouse gases and otheremissions or for limiting the effect of traffic noise.Without these objectives and standards, DTPLI's proposed strategic framework islargely aspirational. Their absence also significantly reduces DTPLI's accountability forperformance and impedes its capacity to effectively oversee and transparently reporton the outcomes of related initiatives across the portfolio. Consequently, it is unlikelythat agency actions will be effective in minimising the environmental impacts of thetransport system.Across the three agencies examined, VicRoads has the most comprehensive strategyfor managing the environmental impacts of the road system, and this is a model ofwhat should exist on a portfolio-wide basis. The strategy has specific goals and actionsfor reducing greenhouse gas emissions, improving air quality and minimising trafficnoise impacts. VicRoads also regularly reports on progress and can demonstrate thatit is improving the environmental performance of the road network.However, neither DTPLI nor PTV has a corporate strategy with clear objectives, targetsand performance measures for environmental performance. This means they cannotdemonstrate that their actions to minimise the environmental impacts of the transportsystem have been effective.It is particularly concerning that public reporting by both agencies on relevantindicators has diminished substantially over time and that PTV has failed to act onprevious recommendations to improve its management and reporting on theenvironmental performance of public transport.x Managing the Environmental Impacts of TransportVictorian Auditor-General’s Report

Audit summaryFindingsStatewide strategic planning and governanceDTPLI advised that Plan Melbourne, VTFS and the RGPs contain ‘the mix ofintegrated actions considered best able to achieve the state's desired outcomes,including environmental outcomes’. However, its claim cannot be verified, becauseduring the framework's development DTPLI neither clarified nor advised thegovernment on what specific environmental outcomes its proposed strategicframework seeks to achieve.Specifically, DTPLI's related advice omitted critical details on statewide objectives,targets and performance measures for minimising the environmental impacts oftransport, including for reducing greenhouse gases and other emissions.This means the strategic framework developed and proposed by DTPLI did not providea clear basis for transport agencies to align their policies and actions. The lack oftargets and performance measures also significantly impedes DTPLI's ability tomeasure the effectiveness of agencies' progress against statewide objectives and toassess whether the aims of the strategic framework and desired environmentaloutcomes have been achieved.DTPLI advised that this framework has since been adopted by the government.Environment-related content in the strategic frameworkThe strategic framework developed by DTPLI recognises the link between proposedactions and their potential to minimise harm to the environment from the transportsystem.Specifically, Plan Melbourne promotes an efficient and more environmentallysustainable city shape based on modelling that shows a smaller number of largeractivity centres, with contained fringe growth, will increase carbon efficiency. However,DTPLI did not define the related outcomes and targets for agencies to work towards toachieve the environmental sustainability objective of the Act.Plan Melbourne encourages an increase in public transport, cycling and walking, andVTFS seeks to promote a shift to rail freight. While these initiatives support theachievement of a more sustainable transport system, DTPLI cannot assess theireffectiveness in the absence of clearly defined objectives and targets. In the absenceof DTPLI developing a comprehensive monitoring and reporting framework with clearlydefined expected environmental outcomes and performance measures, the strategicframework currently remains aspirational in this regard.Advice to governmentDTPLI did not advise the government on options for Plan Melbourne to address theenvironmental sustainability objective of the transport system.Victorian Auditor-General’s ReportManaging the Environmental Impacts of Transportxi

Audit summaryDuring the development of Plan Melbourne, the Ministerial Advisory Council (MAC)proposed a number of detailed actions and specific targets to minimise theenvironmental impacts of transport. However, DTPLI did not advise the government onthe merits or otherwise of the MAC's proposed actions and targets, and these were notadopted in the final strategic framework.During the audit, DTPLI asserted that targets are a matter for government and are notnecessary for measuring progress.However, the establishment of clear targets and benchmarks for assessing theachievement of objectives is a fundamental and widely accepted practice of goodgovernance and public administration. They are also necessary for transparentlyassessing the adequacy of progress made. While the government has the prerogativeto adopt or reject proposed targets, this does not negate DTPLI's obligation to providefrank and fearless

the environmental impacts of transport, and the effectiveness of key strategies and initiatives in reducing the impacts of transport on the environment. Conclusions The environmental impacts of the transport system are significant and growing. Minimising these impacts has been a legislated objective since 2010, but it is clear that

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