Middle for Diddle
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WHETHER the haulier or the clearing house comes first is a question that might provoke a good deal of argument without arriving at a decision. In the jargon of the psychologists, the two parties to the dispute have enjoyed a love-hate relationship for as long as most of them can remember. Even when the haulier goes out of his way to emphasize that some clearing houses are good and useful, and wholly admirable, his tone betrays his opinion that they are particularly worthy of admiration because of their resemblance to the handful of virtuous men in the cities of the plain.
At one stage the disparagement of the clearing houses reached such a pitch that a number of them seriously canvassed the idea of calling themselves by some other name. Surely in no other industry is the middleman so abused. There is not the same stigma even where he exists to serve other forms of transport. The shipping and forwarding agent is generally respected, and must be disagreeably surprised by the opprobrium that rubs off on to him if he ventures to extend his activities into the field of road transport. As a clearing house operator he must earn respect the hard way.
The reasons for the low status of the clearing house are worth analysis. There is evidence of a strange, if unfortunate, willingness on the part of many traders to entrust their traffic almost to anybody who solicits it, providing that the rate is attractive. This prerequisite is made simple, especially at times when business is slack, by the existence of what sometimes seems to be a bottomless pool of hauliers prepared to accept work at almost any price.
The fact that the occupants of this pool come and go, via the bankruptcy courts, with alarming frequency seems not to be worthy of consideration by these traders.
The lack of any universally agreed standard for fixing rates makes the task of the unscrupulous clearing houseman easier. Often without a single vehicle of his own he is able to contract for the movement of large blocks of traffic at an uneconomic price, knowing that he will have no difficulty in sub-contracting the work. Once it becomes known that he is in business he can rely on finding a steady queue of vehicles at his door. Most of them, no doubt, will be looking for return loads; and to the operators concerned the rate is a subsidiary matter.
IF the truth be known, many of the operators do not hold a licence appropriate to the traffic they are offering to carry, and this consideration makes them all the more willing to accept a low price. The clearing house requires no licence, so that there is not even this test available for distinguishing between the good and the bad. The difference is entirely a question of conduct. The good clearing house has a stake in the industry and tries to be as fair as possible to the operators who make use of it. The bad clearing house will often provide no service whatever beyond capturing the traffic and doling it out.
Theosuggestion, put forward persistently for many years, that clearing houses ought to be licensed, has not been heard so often recently. Operators are beginning to abandon their faith in licensing, or, to put it more exactly, their belief in the indestructibility of the present monolithic licensing system, within which it Once seemed that an odd corner might easily be found for clearing houses. A more practical objection was the lack of a suitable definition. Almost every haulier at times acts as a clearing house and sub-contracts the traffic he cannot accommodate in his own vehicles. It is hard to see how this practice differs in essence from the normal work of a clearing house, and how it could be exempted from any system that compelled the middleman to hold a licence.
The proper remedy ought to lie in the hands of the hauliers themselves. They should make use only of the recognized clearing houses, distinguished by their membership of the National Conference of Road Transport Clearing Houses, or of the clearing house group of the Road Haulage Association, or in some other way. There are plenty of reputable and reliable firms, and their number would increase if hauliers sought them out more frequently. The number of undesirable clearing houses would correspondingly decrease as they found themselves unable to get rid of the cut-rate traffic they had taken on.
The process does not work, whatever exhortations are made to hauliers to be sensible. A kind of Gresham's law ensures that the bad rate is continually ousting the good. In a sense this may not seem to matter. Cheap transport has its advantages in whatever way it is achieved. If the haulier is so foolish as to work for nothing, he alone is the sufferer. The trader wishes only to get his traffic moved and, other things being equal, he is disposed to buy in the cheapest market.
IT is doubtful if what is popularly known as the bucketshop type of clearing house would be able to take advantage of closer links established with the rest of Europe. Even Britain's entry into the Common Market would not simplify the procedure for cross-Channel traffic sufficiently to bring it within the scope of the man with no proper facilities and no real knowledge of transport. All the same, the possibility of expansion may cause the problem of the clearing house to be brought up again.
Possibly the supporters of some form of licensing could for this purpose copy the procedure that some Continental countries adopt for prospective hauliers, and impose some kind of financial test. This might involve no more than the production of evidence of reasonable financial standing, and a bankers' reference might be considered sufficient for these purposes.
Such a test would not solve the whole problem, and in any case the amount of money a man has is not necessarily an indication of his probity. On the other hand, the advantages are substantial. There would at last be the equivalent of some form of licensing and it would be suitable to cover sub-contracting of every kind. The haulier might have to undergo the same test, but it need not be too stringent and he would not very often fail.
The system would help to eliminate the clearing house that sets up without resources, the unscrupulous operator with no other idea than to get rich quick, and the man who vanishes And starts another clearing house somewhere else. At least there would be for the first time a complete register of clearing houses. Their right to operate could then be taken away if, for example, they charged too high a commission or failed to settle their accounts within a reasonable time. There might even be an obligation on them to negotiate traffic at fair rates—but that is perhaps another story.