ANTI-GROUP THERAPY
Page 61
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T another spectre is now being installed in the transport trade unions' Chamber of Horrors. In retrospect the ceremony may be said to have begun appropriately in the first trade union conference of the year, that of the Scottish Commercial Motormen's Union in Inverness. The theme will be heard again on a number of occasions, particularly while Mrs. Barbara Castle's transport legislation for the transport industry is passing through parlia ment.
To Mr. Alex Kitson, general secretary of the Scottish Union, fell the credit of unveiling the latest bogy, which turned out to be the Transport Development Group. According to reports, Mr. Kitson saw the group as a "huge amalgam of private hauliers" which was being built up to compete with the proposed National Freight Organization. In Scotland, Mr. Kitson claimed, the group controlled 80 per cent. or more of the long-distance vehicles and was proposing to operate its own rail liner services from a Govan depot.
Just as much as it does other people it may surprise Mr. Philip Henman, chairman of the group, to learn to what sinister purposes his organization is being put. As Mr. Kitson sees it the group is being set up in the private sector of road haulage "to ensure the destruction of the nationalized sector." By a Government with different views from those of the Labour Party it could be used to break up once again that part of road haulage which is at present publicly owned.
Economic justification
The frightening picture of political chicanery composed by Mr. Kitson was somewhat toned down by his subsequent remarks which pointed to a reasonable economic justification for the group's decision to run their own trains. "Over long distances," he said, "the roads could not compete with the railways, who were offering a ScotlandLondon door-to-door service for 47s. a ton compared with the 70s. to 75s. a ton charged by road haulage contractors."
If these figures are accurate and relate to a permanent rates structure no political explanation is needed for the decision of the group or of any other haulier to put traffic on rail. The battle for long-distance freight would seem to be over before it has well begun and the standard of service of the railways would have to be abysmal indeed for the traffic to drift back to the roads. Praise of low railway rates, however, comes strangely from a repre
sentative of the long-distance lorry drivers many of whom may be put out of work when the liner trains take over.
Mr. Kitson might well have echoed the doubts expressed by some hauliers on the soundness of the railways' calculations. The journey to and from the liner train depots must still be made by road vehicles and the basic costs will be the same whether the lorries belong to the railways, to hauliers or to C-licence holders. The wide gap between the road and rail rates quoted by Mr. Kitson suggests to the haulier either that like is not being compared with like or that the rail charges are not likely to be much in excess of the terminal costs. In this event the liner train portion of the journey is presented to the customer for next to nothing.
National Conference
By a coincidence a few days after Mr. Kitson was fulminating against the acknowledged experts in the art of taking over road transport businesses a national conference on mergers and acquisitions was held in Glasgow. The subject of transport was not discussed and the speakers did not include a representative of the group, but some of the observations might have helped to put the fears of the unions into perspective.
The very fact that such a conference could be held points to the respectability conferred on the takeover with the passage of time. Bigness in industry was now a cult, said Professor K. J. W. Alexander of Strathclyde University, instead of a curse as had at one time been thought. The subsequent discussion dealt with the principles and the technique of the merger as a means of fostering that cult.
One interesting exchange of views took place between Mr. Philip Shelbourne of N. M. Rothschild and Sons, who outlined the strategy to be used by one company wishing to take over another; and Mr. F. S. Smith, a director of S. G. Warburg, who described the tactical manoeuvres most suitable for the company under attack. Many road transport operators no doubt would have felt there was scope for a third exposition on the best method of offering
oneself as a sacrifice. The commercial death wish cannot be peculiar to small hauliers.
Size was one of the many issues discussed. Mr. Nicholas A. H, Stacey, of Cheshire Amalgamations and Investments, spoke of the present need for rationalization plus concentration to increase further the number of medium-sized business units. He might almost have had in mind the Transport Development Group which may easily be the largest independent road transport undertaking but bears no sort of comparison with the industrial giants.
Target for 1967
It is certainly big enough to be Mr. Kitson's target for 1967. If he runs true to form he will keep up his criticism on every suitable occasion. Support from other sources may lead towards the end of the year to the ritual burning in effigy of directors of the group together with no doubt those politicians, including even the Minister of Transport if necessary, who do not see their way to discourage the efforts of the group towards its own brand of road-rail co-operation.
Exactly where the unions stand on the liner-train issue is still not clear. Only a few days before his conference Mr. Kitson was expressing pleasure that agreement had been reached with the National Union of Railwaymen but added that this did not solve the problems. The future would depend on the attitude of the hauliers, he said. If their use of the service had a detrimental effect on wages and jobs, the union would not allow its members to use the terminals.
This was Mr. Kitson in the role of the tough arbitrator. He did not feel the need to explain how the hauliers deprived of the use of the terminals would be able to pay the same wages as before for long-distance work in competition with the rates which he quoted with some approval at the union conference. Perhaps to avoid this dilemma he treated his members at the conference to a rousing if old-fashioned warning of a devious road haulage plot. This is not to say that his more serious and usually effective work on their behalf will not continue through other channels.