Revise rates and abandon price restraint, says RHA

22nd September 1972, Page 90

22nd September 1972

Page 90

Page 90, 22nd September 1972 — Revise rates and abandon price restraint, says RHA

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• A strong recommendation to review rates immediately has gone to the 17,000 members of the Road Haulage Association. In a letter dated September 15 the National chairman, Mr John Wells, said: "Last April the then chairman of the Association advised you that according to the latest CAPS report the average increase in road haulage costs during 1971 was 12+ per cent. It was recommended, however, that every effort should be made to restrict increases in rates to a maximum of 5 per cent in view of the Association's support for the Confederation of British Industry's policy of price restraint.

"At the time it was thought that this action by the Association would be matched by a similar response from other sections of the economy and that hauliers and industry as a whole would benefit by a general slackening of inflationary pressure.

Artificial rates

-Unfortunately this expectation has not been realized. Costs continue to rise and road haulage, being both labour intensive and highly competitive, finds itself unable any longer to cushion artificially low rates.

"So great is the burden of costs at present falling on members that the Association has informed the CBI that it cannot support the extension of the price restraint policy, agreed by the CBI, to the end cif October 1972.

"Many haulage companies, having made a thorough review of their costs, have taken immediate steps to increase their rates by at least 10 per cent. I strongly recommend all members to undertake this review and to discuss rates with their customers as soon as possible.

"In raising rates at this time there may be a risk of losing some traffics, but the retention of jobs which are completely unremunerative can never be justified, and those which are only marginally better may not be worth keeping."