Will H.N.T.P. Area Committee's New Rates Schedule Become National?
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Leeds Area Committee of Hauliers' National Traffic Pool Formulates a Schedule Based on a Common Per Ton Lead Mile Standard
ARATES schedule, the principle ot which, it is suggested, may be adopted nationally for operations of the Hauliers' National Traffic Pool, has been formulated by the management ' committee of the Pool's Leeds Area and put into use in respect of Pool traffic coming under the committee's control.
The three outstanding qualities claimed for the schedule are simplicity, elasticity and consistency when it is applied between any given points. Cutting through the tangle of complications which for years have proved obstacles to rates stabilization, it lays down a common "per ton lead mile" basis of rates for all the traffic which it covers—that is, the whole of the Pool traffic under the control of the Leeds Area Management Committee. Complicated classifications,, such as those of the railways, are obviated by the use of what might be termed a " slide rule " on the basic rates, applied according to cubic capacity of the load. In addition, there is a terminal charge to cover costs which, in the case of vehicles in the Government-chartered vehicles, are covered by time and mileage payments.
The Differences Explained
A fundamental difference between the Government rates for chartered vehicles and the Leeds Area Committee's rates is that, whilst the former represent an all-in payment embracing the total distance run by the vehicle, the latter remunerate the operator only for carrying a load to its destination. Thus, if the haulier can pick up a return load, be it Pool traffic or otherwise, the payment for the carriage of that freight is a clear gain to him over and above whs he receives in respect of the primary load. Consequently, although a comparison of average earnings shows a lower yield from the Leeds Area Committee's rates than from the Government charter rates, actually the round trip by a vehicle carrying Pool traffic on the outward run may be more remunerative to the operator by reason of his own industry in securing a return load, if that can be done.
Mr. Harry Wood, of Huddersfield, chairman of the Leeds Area Committee. explained, in an interview with our Yorkshire correspondent, how the committee's schedule has been built up and what factors have been taken into consideration in its formulation. Mr. Wood speaks as one having had much experience of rates problems.
Outlining the Leeds Area Committee's approach to its task of formulating rates for the carriage of Pool traffic under its control, Mr. Wood said: " We had to find a method of being consistent in rate fixing and, at the same time, keeping within what one might call our ' terms of reference.' In the first place, it cannot be too strongly emphasized that the committee's
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problem was one of dealing with only Government-accepted traffic handed to it by the Ministry of War Transport. This factor greatly simplified our task. We were not concerned with the collection and delivery of small lots and their distribution at the other end. Mostly, we pick up and discharge with one lift and drop, although, in some cases, the loads are divided into reasonable weights.
" We laid down certain conditions which should apply, and these are, briefly, as follow:—
" 1. The rate must be fair to hanlier. Ministry and user, and must be associated with the peculiar type of traffic handled.
2. That, so near as possible, we should engage haulage at existent rates, where obtaining: yet, at the same time, retain a consistent level, sale in exceptions...! circutnstances. " 3. The rates haring to be acceptable to the Minister or his representative, they should be so fixed as to bear comparison with the cost II the traffic were carried by chartered vehicles. In the committee's opinion, that would be a good test of fairness to all parties, especially If the actual rate approximated the existing chargeable rate. This rosily meant the conversion of the ' time and mileage' rates in the schedule for Government-chartered vehicles into 'tonnage and job' rates based on mileage, for Pool traffic.
"4. If this were to be so. then any consistent 'reference to railway classification rates for certain class of traffic must be cleared from our minds. It Is no answer. Barely, having regard Is the peculiar tonnage handled by the Pool, to say that the road and railway rates built up on competitive or semi-protective lines in pre-war days shall be the 'basis of Pool rates. Nor could one, on the other hand, take cempetitive rates as between one haulier and another; otherwise the rates would be variable and not acceptable to the Minister or the Government. Department concerned.
' 5. It would be misleading were we to run away with the idea that the Pool rates are to take the place of either competitive or semiprotected rates in private business. This, of course, cannot be, as the traffic handled by the Pool is Government-accepted traffic handed to it by the Minister. This excludes private relation. ship, or the 'what. the traffic will bear' principle, and the conditions of such carriage in private trade. Therefore, the conditions of that private trade must be excluded from our consideration except as ex-parte evidence.
" 6. It would, therefore, appear that thet committee must. find for use as a ' yard stick some formula which is variable only because of the conditions attaching to the consignment in question.
The Return Load Problem " It is too long a story," Mr. Wood continued, "to go into themathematical progressions upon which the yard stick ' which the committee has adopted is based, but the measure is upon a ' per ton lead mile' basis. " At once let us deal with the question of ' return loads.' We must remember that we are concerned with Government and urgent traffic which must he forwarded by road under wartime conditions. The traffic must go whether there is a return load or not, and time must not be unnecessarily wasted -in snooping around it the other end to find a load which sometime; does not exist.
"Many vehicles sent to London recently have had to return empty because there was no return traffic for them to carry. War-time conditions preclude the right invariable to expect it. Flows of traffic and constantly 'changing directions by use of alternative ports. diverted convoys and the peculiar reversal of demand or move, ment of production, all help to account for this position. "This is not to say that handy loads should not be transported as return loadsif they be there—that is the proper utilization of transport. The return-load factor, however, is purely one of a pre-war competitive nature, and is not fundamental from our standpoint as a Pool Committee. Some operators may be better placed than others in respect of ability to obtain return loads, but the Pool is set up to utilize, at any time, all registered participants, and not a favoured few. Therefore, Pool rates should reflect a Mir return for work done; all other points are outside this fundamental consideration."
Average Earnings Compared
Illustrating how the Leeds Area Committee's schedule works, Mr. Wood gave the following comparison of average earnings under the schedule for Government-chartered vehicles on the one hand and his Committee's schedule on the other:— A chartered vehicle covering 600 miles per week, whether loaded or not, running for 40 hours at 15 m.p.h. average, with nine hours per week for terminals, has the following earnings. converted into pence per ton lead mile: 6-ton 2.33 Os. Od. Average cost 4.3d. 8-ton 440 7s. 2d. Average cost 4.0d. 10-ton 446 7s. 6d. Average rest 3.6d. A cross-section of the Leeds Area Committee's schedule shows that a Pool vehicle under the same conditions would give a return over Varying mileages, for 600 miles run, as follows:— .
6-ton 423 14s. Od. Average cost between 8-ton 431 13s. Od. 60 miles lead 13.701 10-ton 439 10s. Od. per ton lead critic; and 200 =lea lead 13.00d.
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ge.i6dtouperleatdon relvad Mr. Wood added: "I do not wish to start controversial discussion on deductions which can be made from these comparisons, but one point which stands out is that my Committee's schedule tends to enforce the use of the proper type of vehicle for the mileage in question on any specific job, whether the distance be long or short. For example, it discourages such uneconomical operation as the use of a 2-tonner for ttie carriage of freight from, say, Leeds to Liverpool."
TERMINAL CIIARGE:-2s. per ton, to cover distance from garage, cost or run to point of Loaaing and other inciefinob.e coats. PROGRESSION or 11:VrE:—Up to 142 lead miles the progression is based upon 3.ted. per ton lead mile, with a graduated scale of seightage, whereby the rate of progression is adjusted according to the length of the run; alter 142 lead-miles the progression it a flat rate of 3d. per ton lead mile, and the weightage remains constant, This system, Mr. Wood points out, could allow of variable combinations according to the need of the incluttry. WEICHTAGE OF RATE:-The weightage scale begins at the first lead mile, but the weightage really begins at the rrixbh, as the Leeds Area Committee usually given out work below that distance at the hourly rates laid down in the schedule for Government-chartered vehicles. At the sixth lead mlle the weightage is an addition of 5s. Bd. per ton to the progression; thenceforward atm weightage additions are reduced In stages of 14. at each further lead mile until nil is reached at 74 lead miles. Thereafter the weIghtage takes the form of deductions. graduated from ld per ton at 75 lead miles and increasing in stages of Id. at every subsequent lead mile until a deduction of 5s. 8c1. per ten is reached at 142 lead miles. Onwards. the weightage deduction remains constant at 5e. 8d. per ton, jast as the erogression remains constant at 3d. per ton. This weightage of the rate, Mr. Woodexplained, is based upon a.
mathetnatical formula of reduction " In balance. It is not an addition to or subtrac
tion from the 314d. per ton lead mile progression as a whole cost, but a weightage of incidence ont, of the rate.
ACTUAL COST IN REACHES Peat TON LEAD MILE:-This is arrived at by dividing the rate per ten, exclusive of the terminal charge, by the mileagerum For example:
60 miles rate 18S. 13d. Is 3.70d. per ton lead mile.
200 miles rate 50s. 3d. it 3,001. per ton lead mile.
Averages in reaches of 10 miles from 60 to 200 give an overall average of 3.16d. per ton lead mile, which is quoted in the comparisons already made with results from the Government rates for charter vehicles.
The " slide rule," for meeting variations in the bulk per ton of goods carried, whilst avoiding complicated classifications, at the same time takes the form of an addendum to the schedule. Working from the standard of 80 cubic ft. per ton, it allows an increase in rates proportionate to the amount by which the cubic capacity of a load exceeds that standard. Thus, it varies the rate according to the goods carried, ignoring the question of the ability of the traffic to bear the increase and the value of the load, by reason of the existence of the Ministry of War Transport's Standard Conditions of Carriage and Insurance Directions.
The addendum provides that the basic rates shall apply to all commodities not exceeding 80 cubic ft. per ton capacity, subject to the qualification that the Area Committee shall be empowered to grant a rebate to the transport user where the cubic capacity is less than 80 cubic ft. per ton, to meet the exigencies of any particular traffic. Any consignment exceeding 80 cubic ft. per ton shall be subject to a special tonnage quotation by grading each specific load by way of an increase on the basic rates as follows:
Percen tage
Cubic ft. per ton Increase on Basic Rates
80 to 90 10
90 to 100 15 100 to 110 20
1.10 to 120 25 120 to 130 3314 130 to 140 50
The schedule applies to a much bigger part of Yorkshire than might be gathered from the fact that it has been put into operation by the Leeds Area Committee. Actually, the so-called Leeds area extends northwards so far as Middlesbrough, and southwards so far as a line drawn west to east from Penistone through Barnsley to Doncaster.
The following is the schedule in detail:
Schedule of Basic Rates 1. The basic rates apply to all corn-• modities not exceeding 80 cubic ft. per ton capacity.
2. For lower than that capacity and the exigencies of any particular traffic offered to the Government Pool, the Management Committee shall be empowered to grant a rebate: From 40 cubic ft. to 60 cubic ft. per ton 7/ per cent. reduction from basic rates.
From 60 cubic ft. to 80 cubic ft. per ton 5 per cent. reduction from basic rates.
3. Whilst the basic rates apply to all commodities not exceeding 80 cubic-ft.
capacity per ton, any consignment exceeding 80 cubic ft. per ton shall he subject to a special tonnage quotation by grading each specific load by way of an increase on the basic rates per ton as follows: