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WoF calculations at odds

7 December 2012

WoF calculations at odds

The Motor Trade Association (MTA) is concerned that some of the key data being considered as part of the Government’s review of warrant of fitness (WoF) frequency lacks consistency, with the potential risks to motorists much higher than originally thought.

With a decision by Associate Minister of Transport Minister Simon Bridges expected shortly MTA says motorists need to know just what the real facts are.

Recently announced findings from a report into the road safety benefits of vehicle roadworthiness inspections by Australia’s Monash University, appear to be at odds with those provided in the Government’s own cost benefit analysis.

The Monash report, sponsored by a vehicle safety research group that includes the New Zealand Transport Agency (NZTA) ACC and AA, concluded that “the 6-monthly inspections compared to annual inspections were not considered to be cost effective.”

The Monash report however indicates that there is a high degree of uncertainty surrounding the impact of changes in WoF inspection frequency, on road safety; and that social costs and the safety impact could potentially be significantly larger than the estimate in the Ministry of Transport (MoT) cost-benefit analysis.

MoT’s cost benefit analysis indicates that the implementation of Option 2 (annual inspections after vehicle age three) - the option most similar to the scenario modelled in the Monash report - could result in approximately 2.3 additional deaths and 30 additional accidents involving injury per year at an annual social cost of $17.4m[1].

At considerable variance from the Government’s own analysis, the Monash report initially estimated the mid-point increase in the overall crash rate at 8 percent. At this level the result could be approximately 25.6 additional deaths and 325 crashes involving injury each year, at an annual social cost of around $192m.

The Monash report however concludes that an 8 percent estimate is unreasonably high as a mid-point and that a more realistic increase in the crash rate would be one in the lower end of the confidence interval (ie, between 0.4 and 8 percent). The actual impact of the change in inspection frequency could therefore be an increase of approximately 1.3 to 25.6 extra deaths and 16 to 325 extra accidents involving injury, each year. The annual increase in the social cost of reduced road safety, based on the Monash report, is most likely to be between $13.5 and $270m [2].

MTA spokesman Ian Stronach says “These projections are a far cry from what Government initially showed, and it will be difficult for motorists to know what the real figures might be. The Monash study was commissioned in 2010 and it can hardly have been said to have been rushed, so why are there such large differences in the outcomes being suggested?”

The Ministry of Transport also estimates that moving the WoF frequency out to 12 months for vehicles up to 12 years of age, could mean the loss of between 1,500 and 2,000 jobs per year. With deaths on roads increasing at the moment and unemployment increasing MTA considers it would be irresponsible of the Government to make substantial changes to the vehicle inspection regimes at the moment.

Stronach adds “This report was partly funded by NZTA and MTA cannot understand at all why the Ministry of Transport did not use these figures in their own cost benefit analysis.”

[1] Table 1: MoT annual safety impacts

DeathsSeriousMinorSocial cost ($m)
Option 10.71.67.7$5.4
Option 22.3524.7$17.4
Option 48.417.988.5$62.9

[2] Table 2: Monash annual safety impacts

Increase in crash rateDeathsSeriousMinorSocial cost ($m)
15%48.1102.4506.5$360.0
8%25.654.6270.1$192.0
0.40%1.32.713.5$9.6

ENDS

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