Fundamental Licensing Changes
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Proposed by 11.1-LA ;tudy Group
THE issuing of carriers' licences on a basis of payload instead of unladen weight; the separation of licences into long-distance and short-distance categories with separate Licensing Authorities for each; the demanding of academic qualifications and financial soundness from newcomers to the industry; and the virtual substitution of general economic requirements for customer evidence in assessIng licence applications and appeals. These are some of the main recommendations of the Road Haulage Association's licensing study group, whose long and detailed report is being presented through the executive committee to the national council. Issuing the report on Monday, the R.H.A. stressed that until the report's recommendations have been accepted by these bodies they cannot be regarded as Association policy.
Having examined licensing systems on the Continent and obtained information from within the R.H.A., the group has come to the fundamental conclusion that the present licensing system for the carriage of goods. established by the 1933 Act, is too localized, especially in that an application tends to be considered in isolation. The report maintains that decisions by 11 independent Licensing Authorities within their own separate areas tend to result in an excess of transport overall, since each Authority necessarily lacks the information to assess the effect of licence grants on the national transport picture.
It is this which leads the group to suggest that haulage operations should be reclassified under four headings, two relating to long-distance work and two to short-distance, with a different form of licence for each. These classes would be: Class 1: National licence without conditions of operation; Class II: National licence subject to specified conditions of operation; Class III: Local licence with restrictions only on radius of operation (normally within 30 miles); Class IV: Local licence with restrictions on radius of operation and the goods to be carried.
Replacing Contract A Under this system Contract A licences would become Class H or Class IV licences, according to the radius of operation involved, and they would, as now, specify the customer with whom the haulier holds a written contract. The R.H.A. group stresses that where licence conditions apply to the exclusive use of a• vehicle for a single customer, such licences should be granted with the same facility as is the case with existing Contract A authorizations Farmers wishing to carry goods for, hire or reward should be required to apply for a Class IV licence, says the report, and the present farmers' C licences (familiarly known as F licences). enabling them to carry for hire, should be abolished. Similarly, a Class IV licence should be applied for by traders needing to use own-account vehicles for hire or reward. In such cases the applicant would need to fulfil the finan
cial and academic conditions which would be required of a carrier applying for a Class IV licence—of which more will he said later.
Where Class 1, II or III licences were granted, the vehicles concerned would not be permitted to carry goods on ownaccount. By the same token, the report states that it is essential for traders to continue to be allowed to carry their own goods in their own vehicles and that this should be regarded as a matter of right.
In an attempt to eliminate illegal use of C-hiring authorizations the group suggests that the hire of goods vehicles by private (i.e. C-licensed) carriers should be controlled through a registration authority which would form a section of each local Licensing Authority's domain. Intending operators would be required to keep records of the employment of the vehicles, for how long they were hired, and to whom.
The report suggests that, as a general rule, all licences should have a currency of five years {though Class II or IV licences might be specified for a shorter term) and that, where renewal applications are for continuation of a licence without modification, no objections should be permitted.
To deal with National licences, the long-distance Class I and II, the group recommends a National Licensing Authority—not a single person but a panel of experienced and qualified people appointed by the Minister of Transport. Each member could hold inquiries and grant or refuse licences, and would be assisted by an assessor or an economist. This panel should operate from a central office but its members would hold simultaneous sittings in several towns as appropriate and convenient.
The local Class III And IV licences should be dealt with by Licensing Authorities appointed to areas, in a manner somewhat similar to the present arrangement of traffic areas. These local Authorities would be expected to have a local knowledge of road haulage, would be appointed by the Minister of Transport and would continue the present practice of holding regular conferences among themselves. They would also be subject to the directions and recom
mendations of the National LA.s.
The report states that applicants for licences should satisfy the L.A. as to their academic qualifications, their financial , references and their general conduct, before the licence applications themselves are examined on merit.
Academic qualifications should, says the group,. be obtained by passing a written and oral examination on technical knowledge of road vehicles, road transport and traffic law, book-keeping and costing, to a standard such as would normally be reached by an adult student of average ability completing a two-year course at an evening institute. This qualification should have to be obtained by the proprietor of a business or by a director of a company or by at least one partner in a partnership. The qualification would not be vested in the firm or company but would vest solely in the examinee. People holding equal or superior qualifications would be exempt from these tests of ability—and so would existing licence holders.
£250 Deposit To satisfy the qualification of financial soundness the group recommends that new entrants to the industry should deposit about £250 with the Licensing Authority irrespective of the number of licences and vehicles involved in the application. This sum would be repayable with reasonable interest after five years, or on the renewal of the licence, but in the event of the financial failure of the licence holder it would be available for the benefit of creditors.
The qualifications outlined above should, it is suggested, be absolute obligations and the Licensing Authority's discretion should be confined solely to consideration of the application itself. But this would include consideration (in chambers) of the applicant's past conduct in relation to his status as a holder of a carrier's liCence. Having dealt with the applicant's conduct, the Licensing Authority should then, at the inquiry itself, pay regard to five main factors in reaching a decision: (a) authoritative data on economic trends; (b) business efficiency factors, determined by reference to an applicant's financial results; (c) the availability of objectors' vehicles; (d) the availability of road haulage generally; (e) customer evidence.
The consideration of customer evidence is quite intentionally placed last. The group feels that it should be regarded as of relatively low importance (except in the case of applicants who are newcomers) and that it should not be to the detriment of an applicant's case that he cannot produce a customer in court. This is in almost direct opposition to present circumstances, under which considerable reliance is normally placed upon customer evidence.
The report suggests that the Licensing Authority should examine the financial behaviour of an applicant for additional tonnage by investigating his accounts to discover, for example, the previous profits, the ratio of turnover to labour costs and the provision for depreciation.
It also recommends that all operators should be required to submit regular returns to their appropriate L.A.s, showing the availability of their vehicles authorized in each of the four licence categories.
In the same way that customer evidence is intentionally relegated to the last place in the list above, the placing of economic trends at the head of that list is also intentional. The group considers that the general economic situation prevailing at the time, and the statistical information relating to that situation (derived in part from the operators' returns just described), are of greater importance than the actual grounds of an application or objection; it believes that an assessment of transport facilities by Local and National Licensing Authorities should be based on more accurate overall information being made available to them. Continuing this theme that a closer and more accurate relationship between the demand for, and supply of, transport is necessary, the group says that more realism should be brought into objection procedure. It feels that Licensing Authorities are unduly influenced by the sheer weight of objections and recommends that an objector be limited solely to an-attempt to satisfy the Licensing Authority of his ability fully and properly to undertake the actual work which an applicant would perform if his application were granted.
Objections Would Diminish
It would be unrealistic, says the group, to deny any form of transport the right to object to carriers' licences, since road haulage is merely a part of the freight carrying industry. But it is expected that the incidence of railway and other objections to Applications, which has restricted haulage industry growth, might well diminish if financial and academic standards were introduced and a strict onus of proof were placed upon objectors.
While suggesting that the Ministry of Transport should reverse the recent decline in effective enforcement and also introduce more efficient methods of control over an irresponsible element in haulage which competes unfairly and brings the industry into disrepute, the group considers that the grounds for licence suspension or revocation are generally satisfactory. But it is recommended that whereas at present a licence may be suspended or revoked because, in obtaining _it, the applicant made a statement of fact which, whether to his knowledge or not, was false, a statement made in the honest belief that it was true should not count as grounds for revocation or suspension.
In making its recommendations for changes in licensing procedure the group took into account that any proposals it might make would have to be politically viable and also capable of matching up with European practice. The group also formed the opinion that the opportunities for obtaining a licence should be available only to those people or companies likely to be able to discharge their proper responsibilities as public carriers, and this, too, is reflected in the recommendations above.
On the question of appeals against the decisions of Licensing Authorities, the group recommends that there should be a complete rehearing of a case on appeal, except where only points of law are involved. It does not recommend the procedure by which only certain parts of a case might be examined. It is suggested that the Transport Tribunal meets the needs of the system proposed by the group, but that the Tribunal should include an economist and that grants or refusals should be determined by reference to economic information.
The group discussed the question of applicants, objectors or appellants being required to lodge deposits which could be forfeited on failure to attend a public hearing, but made no firm recommendations on this.
Since there is no correlation between unladen weights and carrying capacities, the group recommends that licensing should be based on the total carrying capacity of a fleet, it being for the operator to decide how many vehicles this fleet should comprise. The operator would be issued with carrier's licence plates of the hackney carriage type (each displaying licence class, number and authorized capacity), which could be fitted on all vehicles; a plate would be transferable to a substitute vehicle of a carrying capacity no greater than that covered by the plate's authorization.
Such a system would require vehicleweight plating to be introduced and all vehicles would have to be examined by the Ministry and marked with both unladen weights and maximum permitted gross laden weights. To load over the plated weight would be regarded as an offence against the Construction and Use Regulations and a breach of the licence conditions. A copy of the carrier's licence should be displayed on each vehicle, says the report, to make detection of breaches simpler.
Instead of the present Applications and Decisions published for each Traffic Area, it is recommended that there should be a single issue of such a publication to cover all National licences (Class I and II), and local Applications and Decisions issued quite separately by each of the area Licensing Authorities.
The publication of applications and decisions in respect of Class I and III licences should, says the group, include only a broad description of the work contemplated by the applicant, without prejudice, and should not divulge the types of vehicle involved; the publication of Class II and IV applications should, on the other hand, reveal the types of vehicles to be used, the work contemplated and the proposed operating conditions of the licences.
The whole question of how much to divulge is a somewhat vexed one; having decided firmly in favour of a discretionary system of licensing, the study group considered whether this should operate privately or in public and came down heavily in favour of the latter.