R.H.A. Answers Mr. Strauss
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Below is Published the Text of a Statement Issued This Week by the Road Haulage Association in Reply to the Assertion by Mr. G. R. Strauss, Parliamentary Secretary to the Ministry of Transport, that Only by Public Ownership Can Road and Rail Give the Required Service at Satisfactory Rates •
--rHE Road Haulage Association wel1 comes the fact that the Ministry of
Transport and its Parliamentary Secretary obviously appreciate that a considerable amount of effort went into the preparation of the Road-Rail proposals submitted to the Minister in July; it does, however, appear to the Association that Mr. Strauss and his advisors have not grasped the full implication of these proposals. It is suggested, for instance, that the transport industry is governed by a doctrinaire approach to the problem.
This, of course, is disputed, particularly as the R.H.A. has spent the past nine months in trying to tell the country why, in its opinion, the Government proposals, if put into practice, would not improve the efficiency of transport and would definitely cost the country more in the long run.
The R.H.A. has repeatedly stressed the fact that it is non-political and that its opposition to the Government's proposals is based on economic facts. Taking, therefore, Mr. Strauss's own speech. it would appear that he naturally assumes that the public ownership of transport will solve all the problems which, he admits, exist. Actually, the industry's point is that these will remain and that the Parliamentary Secretary. far from explaining how the Labouf Party's policy will solve them, confined himself to criticizing the recent Road-Rail Memoraraum and all previous efforts in this direction, with a misunderstanding of their real purport.
A Misstatement of Fact Everyone admits that there were transport troubles before the war and that a solution is necessary. Mr. Strauss quotes Lord Leathers as expressing in October, 1943. the view that the Square Deal proposals did not go to the root of the problem, and seems to imply that this "Conservative Minister" (as he calls him), "a man," he admits, "of great judgment and an acknowledged authority on transport problems," actually advocated public ownership as the only solution to the problem. Nothing, of course, could be further from the truth.
When the R.H.A. representatives were asked by Lord Leathers, in the summer of 1945, to discuss with the railways some solution, he indicated that, in his view, the acceptance of a greater measure of public-service obligations by road hauliers would be one of the greatest factors contributing towards co-ordination. The acceptance of these obligations is, perhaps, one of the most outstanding features of the recent proposals.
It suggests ignorance of the far-reach
jug character of the new proposals to suggest that they go no further than the Square Deal. For instance, the 1939 Square Deal never envisaged anything approaching the recent proposals for the pooling of local collection and delivery services, or the supply of railway wagons exclusively to hauliers on longdistance road services which, together with the far-reaching obligations accepted by the industry, both as individual concerns and collectively, leave the Square Deal proposals far behind.
Costs Govern Rates Mr. Strauss has some difficulty with "road factors." Here again a perfectly satisfactory answer was given at the Margate Conference, namely, that it is difficult to distinguish between road factors and road costs, and no doubt everybody appreciates that road costs will govern the road rate structure. Road factors are simply the factors affecting road transport costs. The significance of the new proposal, in so far as rates are concerned, is that, for the first time, road costs are being recognized as the deciding factors in both road and rail rates for the future, and both sides recognized that, the railway companies will have to adjust their rates to road costs, hence the term. "capable of co-relation with the road rates structure." if they, with the public haulier, are to have any hope of attracting traffic from the C licensee. Therein lies the root of the matter, about which Mr. Strauss was careful to withhold information.
Drastic Changes Mr. Strauss talked about the reasonableness of individual rates, and said that one cannot build a rates structure upon such vague terms. Nobody, least of all the authors of the proposals, suggested this. He added that if we do use road factors, and here he apparently understands what they mean, such a method of calculation would involve drastic changes in the present railway charges system, which might be contrary to the national interest, particularly as they would appear to contemplate changes in the rates for low-grade traffic, including coal and other basic materials.
Why does Mr. Strauss anticipate any such increases? It has been perfectly clear, from the experience of the railway companies during the war. that it is volume of traffic far more than the level of rates which enables them to show a reasonable turnover on capital.
If we are assured by the Party to which Mr. Strauss belongs that we are to have an expanding economy, no slumps, and full employment, it is surely not unreasonable to look forward to a completely different traffic system to that which both road and rail experienced between the two wars. He also overlooks the fact that, in this period, there were years when the railways had a not-unsatisfactory return for their capital. Despite the myriads of exceptional rates which they gave in face of competition, the general level of rates for high-grade traffic was nowhere near what they anticipated for their standard rate, probably little, if anything, above the prevailing rate for the road traffic.
If the railway rating system is, according to the Labour Government, to be forcibly retained on the value basis, no alternative faces it but the rigid restriction of the C licensee.
It is for the reason that both road and rail faced the desirability of the C licensee having complete freedom that the Road-Rail Memorandum recognized the inevitability, under these conditions, of road and rail rates approximating closely to the costs of the trader carrying his own goods in his own vehicles. We are, therefore, forced to the conclusion that unless the Government faces a shipwreck of its state monopoly from the commencement, it must confine the C licensee's operation to a short radius. Mr. Strauss finds difficulty in visualiz ing a road rates structure applicable to the industry as it is at present con stituted. We have to refer him only to the generally accepted Fawkner Report, and to point out that it is the experi ence of experts that variations in costs.
between operators, tend to average out.
Big companies with high overheads gain certain advantages in buying over the small operators with smaller overheads.
Problems for the Board Mr. Strauss thinks that the mere transfer to public ownership will relieve the Government of all further road-rail problems. The "National Board" will be faced with what to charge, how to charge and what best to charge; whether road rates should be based on road costs and rail rates on rail factors. If this be the case the roads of the country will become ever more congested and the railways will fall into disuse. Or are we back on "division of function 'S by some superior authority—an arbitrary division of traffic carried out by some central authority?
How any Central Authority can determine the hour-to-hour needs of millions of different customers and why this all-powerful authority should be a better judge of ctlw individual trader's requirements than that trader himself it is impossible to understand.