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Putting privatisation to the test
Page 28
Page 29
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Vehicle manufacturers are unlikely to give up on the idea of privatising test centres. But, asks Louise Cole, would operators really benefit?
'Isn he idea that privatising the annual testing of trucks would release Vosa and its considerable assets to concentrate on enforcement is as perennial as spring daffodils or demands for an Australian republic.
The argument goes that Vosa is stretched thin, its focus is clearly declared as targeted enforcement and there are no good reasons to support its continuing hold over the test procedure.
Ian Jones, managing director of commercial vehicles at DaimlerChrysler (UK), was the latest to throw down the gauntlet recently by declaring that Vosa should relinquish responsibility for testing and that MercedesBenz was more than ready to shoulder it.
"I'm being provocative but Stephen Tetlow [chief executive of Vosa] has said many times that enforcement is his focus. If that's true, why is testing a critical part of the business particularly when Vosa is being criticised for a lack of roadside enforcement? The M-B network is very willing to buy the facilities and take over the responsibility and the business."
He's not alone. Other manufacturers would also be keen to get involved and given that Vosa received £.50n1 in testing income last year, it's not hard to see their motivation. The vehicle manufacturers have nationwide dealer networks with most of the facilities they need for testing already in place. In addition, there would probably be a scramble to buy the 89 Vosa test centres in the UK.
The plus side is that Vosa's test station real estate was valued at more than £64m in March 2005 the equivalent of two and a half years' enforcement spend. Test stations currently in need of refurbishment would receive considerably more investment from the private sector than is likely on a government budget. Geoff Dossetter of the Freight Transport Association says: "We've always been in favour of a liberal attitude. If the motor trade can provide an adequate and efficient service then why should they not be allowed to?" He argues that competition can only improve service and value for customers.
But there are other issues which campaigners can't as easily resolve. Alan Osborne, audit services director of the VIA, has serious reservations. "Safety has to be paramount," he says. "There would need to be a national standard and the challenges there are huge. Vosa already gets criticised over standards and we fear privatisation could worsen this,"
The standards problem
Vehicle manufacturers are currently working hard to establish standards for test preparation across their dealer networks. Des marketing director.Tony Pain,says its target first-time pass rate is 85°/0,but that dealers"aren't as consistent as we'd like". Alan Beale, commercial vehicle technical training team leader for MercedesBenz, is also tackling the standards problem head on: "Our lowest first pass rate figures are 65% ;others at over 90%. Obviously we aim for the higher."
Ron Bowie, Volvo's fleet engineering manager, says: "Our first-time pass rate is now in the low 80s, against a national average of 67%. However, this varies across the network from low 70s to high 80s on a three-month period at a regional level and the variations are also seen within the regions themselves."
Despite the manufacturers' best efforts, achieving consistent standards across a national network for test preparation standards is, as Osborne expressed it, a "huge challenge". Vosa's centres themselves come under lire for a portion of these differences but in truth it is almost impossible to gauge how much is Vosa moving the bar and how much is varying standards among garages.The fact is the situation would be unlikely to improve if the dealers were also doing the tests it could be argued that it would be much harder to maintain any kind of standard across different marques and independents if the
tests were in-house. Bowie says: "As soon as there are human beings involved, consistency goes out the window."
Vested interests There is also the fear that privatisation would give rise to a serious conflict of interests.Osbome says: "In designated centres, vested interests could sway the results." On the one hand, there is the risk of garages identifying non-existent faults to bump up income; on the other,of not wanting to fail a vehicle and alienate a customer, particularly if they have just prepared it for test themselves.
Another concern is that the system would become profit-oriented, not service-oriented. Vosa's results from 200,1-5 show only ail .4m surplus on a testing income of £51.6rn. Government may not always be the most efficient operator of services but, particularly if the dealer network was to invest substantial cash in testing, it is moot whether they could make much money without fees climbing.
The counter-argument is that competition would keep costs down, but as Jones himself says, the vast majority of vehicles are now sold with R&M contracts; test fees would probably not be a great enough proportion of the package to deter such sales, and operators' costs could subsequently rise.
The fact is that most people talk of establishing a national standard and a watchdog body to oversee it — which would almost certainly be Vosa in the same way that it polices the car MoT process. But as with cars, it is the owner/operator who is responsible if the vehicle isn't roadworthy, and in the truck industry this can cost your licence. But would it be necessary for dealers passing until lorries to share responsibility for compliance? "The market will do that for you," says Pain. "Operators need to understand that the dealer's job is to keep the vehicle roadworthy and compliant. Equally, if they get down the road and are stopped they won't return to a dealer who risked their fleet."
So who would really benefit from privatisation? The motor trade certainly, and theyseem to sense that this is potentially a huge new market for them. But would operators he better off? Many value Vosa's neutrality and even in a privatised world there would still be a demand for a single authority for appeal. Objectivity, prices, road safety... all these issues defy an easy solution.
Whether you are in favour of privatisation seems to come down to the colour of your economics, if not your politics — whether you believe the free market drives efficiency and productivity or whether you believe the provision of certain strategic services should be trusted only to government. Maybe the rail industry has lessons for road transport yet. •