What Will the B.T.C. Do?
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If All Transport Units are Sold the Commission Will be Left with 4,875 Goods Vehicles, Divided into Three Classes : How Will They be Used and What is the Future of Passenger Transport ?
By Ernest Davies 110., Assoanst.T.
THE extent to which the British Transport Commission will continue to engage in road haulage depends first on the Disposals Board's success in finding purchasers for transport units, for the shares
of any companies formed and for the balance of the existing road haulage undertaking not retained by the B.T.C. Secondly, it will rest upon the Commission's decision as to which vehicles they will retain.
Five-fourths of the vehicles, or the equivalent in unladen weight of the number, taken over by the railways, totalling 4,875 units of a maximum unladen weight of 17,200 tons, may be retained by the B.T.C. These vehicles are divided into three categories—heavy haulage units or special types for abnormal indivisible loads, other special-purpose vehicles, such as removal pantechnicons, and all others.
The manner in which the retained vehicles are divided between these categories must correspond to the position existing at the 1948 take-over, except for a small tolerance of 5 per cent, in each class. If the Commission chose to keep more heavy vehicles, they could do so up to that extra limit of 5 per cent., but they would do so at the expense of those in the other categories. The maximum number of vehicles that the Commission could retain in each of the classes is 210 for heavy haulage (2,500 tons), 1,630 " specials " (5,000 tons) and 3,320 ordinary load carriers (10,500 tons), but they could not keep them all, for the total would be 5,160 vehicles (18,000 tons).
In none of these categories will the Commission be left with sufficient vehicles to operate any one of their present networks, e.g., trunk services, parcels and smalls or Pickfords, which at present deploy roughly 6,500, 3,500 and 3,000 vehicles respectively.
Skeletons in the Cupboard?
In the unlikely event, therefore, of purchasers being found for all the Commission's vehicles offered for sale, the B.T.C. will be left with only 4,875 vehicles split among the three classes. They will then have to decide how these vehicles are to be employed. Will they endeavour to keep going a skeleton Pickfords organization, or their parcels and smalls services, or their trunk services and general haulage?
That is anyone's guess, and I doubt whether the Commission can finally decide until they see how disposal proceeds. Through the company or companies which will operate the retained vehicles, the most satisfactory course to follow might be to carry on as long as possible the general haulage business, specializing in trunk service, and use the heavy and special vehicles for as much of the profitable pickfords work as can be obtained, but to drop the parcels and smalls services, which, I assume, are the most cumbersome to handle.
Whatever the Commission decide, and whatever the result of the disposal, they will certainly remain in road haulage as competitors of private operators. With a nucleus of vehicles and by applying to the Licensing Authorities for further licences, there is nothing to prevent the Commission-owned companies from slowly building up their fleets.
The alternative to the continuance of a general road haulage business would be for the retained vehicles to be integrated with the railways. The B.T.C. have a year in which to produce their railway re-organization scheme, which then has to be laid before Parliament, first as a White Paper and then as a Statutory Order. By then, the position of the industry will be much clearer and it should be easier for the Commission to decide to what use to put their vehicles.
R.H.E. Competition with Railways in the past the Road Haulage Executive have, in effect, competed with the railways for traffic, although a great deal of the goods carried by British Road Services on their trunk services could equally well be consigned by rail. Integration, which was one of the main purposes of the 1947 Act, was proceeding very slowly for reasons that are now well known, but had the Commission been left undisturbed, considerable development in this direction could have been expected.
With the steady run-down of the R.H.E. services, the
B.T.C. might ultimately decide that the most useful purpose to which their retained vehicles could . be put was to supplement the railways. They might be employed for extending the feeder services, taking over rail traffic on closed lines and for road-rail container deliveries.
Whether this course is adopted may depend upon the extent to which the B.T.C. can carry on such activities without calling upon the retained vehicles. The railways keep their collection and delivery services, and, according to my reading of the Transport Act, the Commission's position in road transport reverts to that of the railways before nationalization.
There is nothing to prevent them from applying to the Licensing Authorities for licences for vehicles needed for operation in conjunction with the railways. If this is so, and the easier licensing provisions of the new Act make the granting of applications more likely, it would appear that the Commission will not need to confine the use of their retained vehicles to supplementing railway work.
An interesting position may well arise with railway reorganization. From the Parliamentary debates differences emerged between the Commission and the Government as to the form the scheme should take: the former wanted to retain substantial control at the centre, the Government to give the regions a greater degree of autonomy. In the event, it is likely that the five or six regions will have a large measure of managerial independence. Each will probably be run by some form of management board corresponding to a board of directors, the chairmen of which will probably serve also on the Commission, which will be responsible for the functions retained at the centre.
If this is so, there will presumably be nothing to prevent each of the regions from engaging in road haulage. In fact, the regions could become not merely railway regions, but transport regions co-ordinating the Commission's retained services, passenger and goods, in their areas. This is, however, looking some way ahead.
But road hauliers must take into account a new railway set-up. Not only will the railways be in a far better position to compete, as a result of the abolition of restrictions, but there will be greater managerial flexibility. The fact that complaints can be made about charges for monopoly traffics does not affect the position, as these should not concern road hauliers.
Railways as Road Hauliers
Regional managements will be anxious to justify their independence and produce good results, and will probably not only compete vigorously for all available traffic, but, if they are enterprising, will, to the extent permitted by the Licensing Authorities, enter the road haulage business themselves.
The Act provides for the sale only of the existing road haulage undertaking and the Commission retain the right to engage in road haulage, except as part of the existing undertaking. There is no reason why this right cannot be delegated to the regions. It is important to
keep in mind Section 1 (4) of the Act, which reads:— " Nothing in this section shall be taken as restricting the powers conferied on the Commission by section two of the Transport Act, 1947, and, accordingly the Commission may provide, continue or develop any services or facilities for the carriage of goods by mai otherwise than as part of the operation of the existing road haulage undertaking.'
As the Commission can engage in road haulage in connection with their retained undertakings, including the railways, there is no need for the retained vehicles to be allocated to the railways on a regional basis. Therefore, if the B.T.C. wish to make the best use of the retained vehicles and their more experienced staff, they will continue in the road haulage business as such. They will then be in a better position for the future expansion of their road haulage when times are more propitious.
I now turn to the Commission's interest in road passenger transport, the future of which is at least as uncertain as that of their road haulage. The B.T.C. have a large holding in Scottish and provincial buses. They directly own nearly 12,000 vehicles. Only in Scotland and. East Anglia, however, have they a monopoly of surface passenger transport. Their road passenger investment is highly profitable and makes a full contribution to the central charges. Loss of this business would consequently react unfavourably on their finances.
The main provision of the new Act with regard to road passenger transport is that the Minister is given power to direct the Commission to divest themselves of the control of road passenger undertakings, but it is limited to. instructing the B.T.C. to sell enough shares to reduce their interest to 49 per cent. This power is permissive and not obligatory.
During the debates on the Bill, the Minister stated that he would await the report of the Thesiger Committee before taking any action. Here he may have a disappointment, because the committee may not rit0 give him guidance in deciding whether he should use this power or not. The terms of reference of the committee are limited to inquiring into "the operation of the provisions of the Road Traffic Act, 1930, relating to the licensing of public road passenger services and to make recommendations." It would be difficult to stretch them to include recommendations on the future of the Commission's interest in road passenger transport.
Whether the fact that the Commission have a monopoly in certain areas of all surface passenger transport so affects the working of the 1930 Act that it should be revised, is more a political than a transport question. The argument is advanced that with common ownership of road and rail services, the B.T.C. might unduly restrict road services in order to retain the traffic for the railways.
Nevertheless, the • power and responsibility of the Licensing Authorities remain unimpaired. It is for them to decide whether services are adequate and they can act appropriately. The Northern Roadways case has emphasized this truth. In any event, whatever recommendations the committee may make about licensing, the question whether the Commission should have a monopoly or retain their majority interests in road passenger transport is undoubtedly outside the terms of reference.
Whether the Thesiger Committee recommend any drastic changes or not—and the general opinion is that they will not—their findings will not affect the issue— certainly not if no serious changes are proposed with regard to stage and express services, but only in connection with contract carriages. Contract work does not concern the Commission, which under the Act are strictly limited in this field.
Who But B.E.T. Could Buy ?
The Thesiger report is not expected until the early autumn and meantime the Commission can carry on. Thereafter, the Minister will have to decide whether to require the B. r.c. to dispose of their majority holdings. If he does, and the Commission have to put up for sale 51 per cent. of their interest in the Tilling Group and in the SALT., who can purchase except the B.E.T.?
Such a transfer of ownership would make no great change in the industry, except to increase the already considerable power of the B.E.T. That would seem to be contrary to the general policy of the present Government, which is to encourage competition and the small operator.
The latter will have reason to be concerned if such a change occurs. His position will not be improved, because the BET. would follow no different policy from that of the Commission with regard to new applicants. Both are powerful in objecting to new entrants to the industry and able to make themselves heard before the Licensing Authorities.
The present position of road passenger transport cannot remain indefinitely. Area schemes are dead, but something will have -to be done to improve matters in those areas where there is an excess of facilities or inadequate co-ordination among the large number of operators, such as in South Wales. The Act does not point the way. It is purely negative in this respect. But if the Minister uses his powers with regard to the Commission's holdings, the small operator may find himself facing even more powerful opposition than at present.
The problem of the future of road passenger transport is far greater than the part that the Commission shall play, and is thus outside the scope of the effects of the 1947 Act and. therefore, of this series of articles.