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Transport Minister claims road reform will be a bigger change than invention of car

Ministry of Communications and Transport Anne Berner presented more details of her plan to overhaul the administration of Finland's roads and railways on Thursday. She said the sweeping reform is necessary because the current state administration alone cannot address the 2.4-billion-euro repair deficit that she says has built up in the country's transport network, and claimed that the reform would be a bigger change than the invention of the automobile.

Liikenne- ja viestintäministeri Anne Berner tiedotustilaisuudessa Helsingissä.
Anne Berner Image: Heikki Saukkomaa / Lehtikuva

Finland's Minister of Transport Anne Berner met the press on Thursday to explain more of the intricacies of her planned transport administration shake-up.

"Transport is set to change completely in the coming years, and the shift will in practice be bigger than the invention of the car," said minister as she opened her press conference in Helsinki.

Among other things, the reform would hand over roads and administration of road transport from the Finnish Transport Agency to a new state-owned transport network company that would sell drivers the right to use the nation's roads for a certain period of time.

If the plan goes through, it would bring significant changes for motorists. The current tax on new cars would be replaced by an annual customer fee, averaging 500-600 euros a year. Drivers could pay for road use by the week, month or year.

Only those buying new cars would benefit from the abolition of the car tax. Therefore the basic vehicle tax, averaging 180 euros annually, would also be lowered and fuel taxes would be reduced.

Opposition - and coalition partner - reject plan

The leading opposition party, the Social Democrats, are critical of the proposed plan.

SDP leadership foresees major problems with the government's idea to partially privatise road and railways, saying that it would inevitably lead to the privatisation of the entire network.

Antti Rinne, the current SDP chair, says the proposal would also increase social inequality, as people that drive a lot and rural inhabitants would end up paying more if the system of user fees would be adopted.

Perhaps more significant, a prominent member of the government coalition Finns Party has also lambasted the proposal.

Defence Minister Jussi Niinistö said in his blog on Thursday that the plan is simply a proposal at this stage, and the coalition has not yet decided on the specifics of the plan.

"Maintenance of the transport network and emission reduction goals certainly don't require that state-sponsored infrastructure should be privatised and nationally-owned assets would make profits at the citizen's expense," Niinistö wrote.

Car importers welcome lower prices on new cars

Another central tenet of the proposed plan would lower the tax on new cars significantly.

The change would mean 500 million euros in savings in new car taxes, in addition to a 200-million-euro discount on fuel tax. The Association of Automobile Importers in Finland supports the new plan, as they feel a tax system that focuses on automobile use over car purchases is more equitable.

EDIT This story has been edited to reflect the corporate structure of the proposed new entity, and to remove mention of 'privatisation'.

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