Janus comments
Page 48
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Wet blanket
I POINTED OUT last week that when speaking to the Freight Transport Association and the Road Haulage Association the Minister of Transport chose completely different themes and succeeded each time in getting a largely favourable response. This task Mr. Marsh may have found easier with the FTA than with the RHA whose criticism of the Transport Act 1968 has been sharper.
For the traders on own-account the Minister concentrated on the timetable for the various road transport provisions in the Act—quality licensing, drivers' hours transport managers' licences and special authorizations. He praised co-operation received from the industry and reassured the PTA president that he appreciated the need, from the point of view of both operators and drivers, of a "playing in period" without undue haste.
Mr. Marsh sees clearly that the two organizations have varying aims and functions although on many points they work with each other. Although A, B and C licences are to disappear the distinction remains clear for him between the professional haulier and the trader on ownaccount—rather than the user who may or may not run his own vehicles.
His comments on the future were embedded firmly in the context of the present. He does not appear to envisage much change in the role of the associations.
Vital This came out even more clearly in what he had to say to the RHA. Increased costs and productivity were plainly announced as his subject. He realized that although these were important to all operators they were vital to the very livelihood of hauliers and that this difference would not be altered merely by allowing traders to carry goods for hire or reward.
Disproportionate attention has been attracted to the brief moment in his speech when he assumed the mantle of Mr. Aubrey Jones. The rapid increase in road goods traffic, said Mr. Marsh, coupled with the decline of the railways, had implications for the community. There was a greater insistence on new safety measures with resultant increased costs for the road transport industry. However, he went on, blanket increases in haulage rates were not justified. The . industry must do far more than it had in offsetting higher costs by greater productivity.
To the audience of hauliers this must have seemed no more than the obligatory if somewhat irritating genuflection to the Prices and Incomes Board. It aroused no great hostility. The hauliers had heard it all before and become hardened to it. This ought not to prevent them giving further consideration to the subject especially now that the Minister has reopened it.
It was not necessary for his argument. He may have thought it advisable to slam the door instead of taking for granted that it was closed. Alternatively he may have had in mind some actual or proposed rates increases that could be construed as under the pejorative blanket.
The Prices and Incomes Board started the witch hunt by condemning the practice of periodical general rate recommendations by the RHA. This has not prevented groups of operators in a town or district or engaged in similar traffic from making their own announcements, particularly following a sharp increase in costs such as the extra fuel tax in the last Budget.
Over the years sporadic complaints have been made usually by individual customers to the Board or the Ministry or the Department of Employment and Productivity. The approaches are not likely to be welcomed either by the Board or by the Ministries who have so many other things to worry about. Mr. Aubrey Jones may sometimes wish he had never pressed the button that set the machinery going.
In some cases the so-called blanket increase is the only feasible solution to the hauliers' problem. This applies particularly where a large number of hauliers serve a much smaller number of customers or even a single customer.
Typical This is the typical situation with tipping vehicle work for a quarry. The owner or manager who is determined to keep transport costs down even below an economic level is in a strong position. The operators largely depend on him; many of them are bound to him exclusively on contract. He often dictates his rate to them and even when there is some room for manoeuvre he will accept the lowest bid and can find other people to do the work of operators who ask too much.
The conditions are changing. Operators' licensing in theory will give the haulier freedom to go elsewhere. Plating and testing ought to mean that he will go out of business even more quickly if he does not earn enough to look after his vehicles properly.
Pressure caused by these changes and a growing desperation have helped to band the operators together, usually with the help of the RHA and the Licensing Authority. The quarry owner has been faced with the threat of a strike or lockout unlessl he agrees to what is nothing more or less than a blanket rates increase. With the cutting off at the licensing source of a former apparently inexhaustible supply of victims he has been compelled to agree.
Embarrassing
In a mood which hardly needs to be described he can hardly be blamed for seeing no difference between what is happening to him and the practice deplored by the Prices and Incomes Board. Neither apparently does he realize how embarrassing his protests must be or ought to be to the Board and to the Ministries.
Strictly speaking he is in the right even if he accepts that the operators are justified in asking for an increase of some kind. Some of them have done better than others at the previous level of rates although none of them has made what may be called a decent living.
Militant action has produced substantial rates increases, as much as 30 per cent in some cases. This is an indication of the pitiful rates previously paid. All operators ought to be satisfied with the new scale but some have needed the increase more than others. This is not an argument in favour of paying them less. Where this happened the quarry owner would tend not to employ the other operators to whom he had agreed to pay more. Conditions would drift back to what they were.
In this situation it is sensible to have fixed rates and blanket rate increases. The operator should be paid enough to meet his normal requirements and obligations with a reasonable margin of profit. If through circumitances or higher productivity he does a little better than the next man, that is his good fortune.
There is no difference in principle where a large operator decides to put his rates up. Ten days ago British Road Services (Parcels) increased rates by an average of 5+ per cent. The tariff was adjusted so that the increase varied according to the size and weight of the consignment. However, no distinction was made between the customers. Like the quarry owner they have to pay on the new scale without differentiation.
As part of the State-owned National Freight Corporation BRS (Parcels) naturally obtained prior approval from the Government under the prices and incomes policy. Fortunately for that policy other operators feel under no obligation to do the same. There would be no end to the investigations that might then have to be made.
A bizarre note is added by news that the Leeds and District Hauliers Federation has decided not to increase rates to cover the recent Budget increase in fuel tax. What impelled the Federation to make such a decision public is not clear. Without stretching the words too far it could be described as a blanket rates standstill. It is unlikely to attract the attention of the Prices and Incomes Board in spite of the Board's reasonably clear indication that unavoidable tax increases would usually be passed on to the customer.
What is happening at local level once again raises doubt whether the Board were wise or even right in opposing what were after all merely recommendations—and not mandatory increases—by the RHA.