Around the world look at registration and licensing

In early April, we had an around the world look at compulsory third party insurance. Now we compare registration and licensing systems in Europe, New Zealand and Australia. We found some surprising differences and some we could adopt here.

Similar ideas

According to the Austroads April 2020 study of registration and licensing, some ideas and problems are common to Australia, New Zealand and Europe.

First, the minimum age to drive a light vehicle is still 17 or 18. This is an interesting similarity given the human brain is not fully developed until the mid-20s.

Authorities want to ensure training and licensing conditions promote the safety of all drivers, especially young drivers. Most use a system of penalty points and take strong measures to reduce driving offences or drink and drug driving. All are concerned about the risks in vehicle identity, registration misuse or fraud, unregistered driving and theft.

Finally, most are exploring or planning to use digital driver licences and digital registration documents.

Different concerns

There appear to be two main differences between Europe and Australia. They are mandatory third party property damage insurance and formal driver training.

First, European countries make third party property damage insurance mandatory, along with personal injury (CTP) insurance. If both types of insurance were mandatory in Australia, it would upset vehicle owners who already find CTP a burden.

Second, Europe places more importance on formal driver training than on supervised driving (not always permitted). Most countries even require a medical test before someone can get a driver licence.

Some interesting quirks

Australia and New Zealand use more alcohol interlock devices than Europe and conduct more extensive random alcohol and drug testing.

As we can see, personalised registration plates are quite common in Australia and New Zealand. But some countries in Europe, like Spain and the Netherlands, do not even have them. In the UK, they are charmingly called “cherish plates”.

Across the ditch, customers can choose a registration period as brief as one day, up to one year. Around 60% choose 1, 3 or 6 months. Europeans do not have periodic registration. This is because insurers charge their insurance premiums separately, not as part of registration.

In Australia, we have vehicle-based licensing, where you register the vehicle and the plates stay with the vehicle. In many countries, the plate number depends on the region where the vehicle is licensed. However, Belgium, Austria, Slovakia, Lithuania, Malta and Switzerland associate the plate with the individual and that person keeps the same plate for any vehicle they own.

Driver training

Many experts in Australia claim driver training in Europe is superior to training here and that is why road tolls are relatively lower in densely populated countries like Germany. Most learners in Europe have to take a set number of lessons at a driving school. In most countries, they need sight and hearing tests and, in three countries, a first aid certificate. Less than half of all countries issue a provisional licence (P plates) before a full licence.

Here are a few other quirks:

  • Finland and Luxembourg – learners have to take a practical driving test before progressing to a full licence
  • Germany – they print driver licences before someone takes their driving test so they don’t have to wait for a licence once they pass
  • Hungary – if a driver in the first 2 years of holding a licence commits a driving offence, they have to go back to being a beginner
  • Iceland – drivers take a second test after holding a licence for 1-3 years and get their full licence only if they had no traffic violations within the previous year.

Which ideas could Australians adopt?

Of course, there are always inevitable differences in state licensing and registration systems across Australia.

We think person-based registration is interesting because it does not matter which vehicle you drive, you are covered. It creates consistency and could reduce the volume of administration currently needed every time someone gets a new vehicle.

We might also opt for more formal driver training because, when parents supervise their children’s driving, they can unwittingly pass on bad driving habits!

Corrina Baird

Writer and expert

Corrina used to lend her car to her kids and discovered first hand what Ls, Ps and demerits mean for greenslips. After 20 years of writing and research in financial services, she’s an expert in the NSW CTP scheme. Read more about Corrina

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