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JANUS It is vital that spokesmen should WRITES keep reminding the Community

28th June 1963, Page 86
28th June 1963
Page 86
Page 86, 28th June 1963 — JANUS It is vital that spokesmen should WRITES keep reminding the Community
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Which of the following most accurately describes the problem?

of British opinion"

BRITISH transport operators had divided or concealed opinions about the likely effect upon them of entry into the Common Market. When this seemed likely, they put their best face upon it by appearing to be neutral. They were ruefully aware that there were many other matters considered more important by the Government than transport. If it had come to the bargaining point, the transport proposals of the Six, whatever form they had taken, would not have been too much for Britain to swallow, provided satisfactory terms had been reached on such matters as Commonwealth preference and agriculture.

For this reason if for no other, operators were constrained to pore over the considerable transport dossier that was being accumulated in Brussels. Those who took the trouble might have been excused a feeling of bewilderment that the many excellent principles laid down could have led to such strange conclusions. One of the main purposes of the Treaty of Rome was to provide completely free competition throughout the European Economic Community, and a common transport policy was also stipulated.

Most people would suppose they had some idea of what this meant. Whatever their ideas,they must have been surprised to find that, by the time transport had made its way through the bureaucratic machinery of the Community, one of the main detailed proposals was the establishment of rates schedules with which all operators, with some exceptions, were expected to comply. There was to be considerable latitude to charge above or below whatever rates were fixed, but the general principle was unmistakable.

FIXED RATES PROPOSALS The proposals for fixed rates attracted more attention than all the rest. For British operators, and even more so for British transport users, it seemed to contradict everything the Common Market was supposed to-mean. Many operators within the Community felt the same thing. Latest reports from Brussels are that there is still incomplete agreement on the transport provisions, which were supposed to begin to take effect in 1964, that the Dutch and the Italians are the chief opponents, and that their objections include doubts on the propriety or wisdom of removing rates from the sphere of competition.

Sensible doubts were also cast recently by Mr. E. G. Whitaker, president of the Institute of Transport, in an address to the European Ministers of Transport. Mr. Whitaker was sceptical of the claim that a system of minimum and maximum rates was only the first step towards a greater liberalization of transport. Once a new measure of control of this kind was introduced, he said, the carriers who found it to their advantage would strive to hold on to its protection and would oppose any move towards more competitive conditions.

For Mr. Whitaker, freedom to compete is a cardinal principle, which he re-stated even more clearly and emphatically to the Ministers of Transport than in his inaugural presidential address to the Institute. In his opinion, control is necessary only where there is a monopoly and therefore effective competition cannot exist. This B44

principle should apply throughout the economy. " Before we accept that the transport industry should be an exception ", Mr. Whitaker told the Ministers, "we should look very critically at the reasons given ".

Certain reasons were given by M. Schaus in his memorandum on the lines along which the common transport policy should be developed. Mr. Whitaker examined this part of the document with a critical eye. He agreed with M. Schaus that transport was an important part of the economy, but there were other industries equally important, and there was no justification for treating transport differently on this ground. The monopolistic position of the railways, to which M. Schaus also referred, had virtually disappeared, said Mr. Whitaker, and no longer need be taken into account.

FREE COMPETITION OBJECTION

Another objection by M. Schaus to free competition was that some countries maintained specific transport. services even when they could not be made to Pay, and intervened in transport investment when they were responsible, for example, for the roads. If a subsidy was clearly • defined and openly declared, said Mr. Whitaker, it need not interfere with competition over the rest of the field. Similarly, there was nothing wrong with government investment in transport, provided the user of each form of transport was called upon to make his appropriate contribution towards servicing the capital so employed.

If negotiations for Britain's entry into the Common Market were still proceeding, Mr. Whitaker's speech would have been a major pronouncement. It is still important as an expression of the view of a large transport user, apart from the possibility of joining the Common Market at a later date. There were very strong arguments, said Mr. Whitaker, for giving all forms of transport a larger measure of freedom to run their undertakings on commercial lines. It was also his opinion that the several sectors of the transport industry should be free to fix their charges according to their costs and the state of the market, without control by the authorities. Moreover, he added, "customers should not have any say in the matter of charges beyond that inherent in normal commercial negotiation ".

The last point is one that many hauliers will welcome. They may also feel some relief at Mr. Whitaker's further doubt whether the time was yet opportune for the complete removal of the control of entry to the transport industry, "particularly to road freight services ". This might, he thought, encourage a surplus of transport facilities, in spite of which "a considerable reduction in control should remain a long-term objective ".

If Britain were to join the Common Market at some-later stage when a transport policy had finally been approved and put into effect, the likelihood is that British operators and users would be forced to followthat policy, whatever their own views on the matter. It is vital therefore that spokesmen, such as Mr. Whitaker should keep reminding the Community of British opinion, in the hope that it may have some effect on the present discussions in Brussels.


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