Uneconomic Coal Carrying Rates
Page 37
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R.H.A. FORCES A RATES INQUIRY AT BRISTOL
WHETHER he intended it or not, the state of affairs brought to light at a recent public inquiry held at Bristol by the Western Licensing Authority, Mr. Stanley Nelson, disclosing how coal distributors to the Central Electricity Generating Board in South Wales are forced to make their living—at the expense of hauliers—has shown a scandalous state of affairs.
As exclusively reported in The Commercial Motor, December 27, evidence was given by one such coal distributor to the C.E.G.B., and by an official of the Board that the distributor actually sells the coal to the Board at the official National Coal Board's "pithead
price To quote an extract from the shorthand note:
" Mr. Nelson: Doesn't the distributor make any profit on the coal? Mr. Cook (Assistant in the fuel suppliers dept., C.E.G.13.): Only what he makes on transport.
In terms of hard cash it means this— that a rate of 31s. a ton is being offered by distributors, at the instigation of the C.E.G.B., for the carriage of coal from two Nottingham coalfields to the Uskmouth Power Station against one hauliers' quoted rate of 43s. a ton, and against the actual rate charged by British Railways of 37s. 10d. a ton.
The unfortunate thing about all this is —and Mr. Nelson himself expressed his surprise at this, too—that some 50 or so vehicles belonging to licensed hauliers are already carrying coal at 31s. a ton-to Wales from Nottinghamshire—a rate which Mr. Nelson declared in his decision to be "not sufficient" and un remunerative.
"Stormy Words"
It was disclosed during the inquiry that there had been some "stormy words" between the particular coal distributor coneerned—Thrutehley and Co. Ltd.— and the Road Haulage Association's local area secretary, Mr. J. F. Cox, when Thrutchley contacted the Association to see if it could get hold of hauliers to do the work. The R.H.A., it appeared, considered that the lowest minimum fair price for the job was 35s., and it was the R.H.A. that, in fact, forced the matter into open court at the first opportunity available, when a Cirencester tipper ownei, Mrs. B. K. E. Mountain, applied to the Authority for a short-term B licence, which would authorize her to work for Thrutehley, carrying coal to Usk mouth.
Describing it as a test case, Mr. Nelson explained that the reason he was holding the inquiry (which, incidentally, was not advertised in advance in the Western " As and Ds ") was because last year, during the fuel crisis brought about by the weather, he had granted a large number of short-term licences to carry coal to power stations. Apparently there had been a great deal of dissatisfaction about this among East Midland operators and among some Western licence holders who had asked: Why should unlicensed newcomers he allowed to carry this when we have vehicles available?"
"ibis year," Mr. Nelson explained, "I feel I must go into these matters very carefully before granting these short-term licences." As a matter of practice, he would now contact the R.H.A. and British Railways whenever short-term licences were sought for coal carrying.
Mr. Nelson was told by the applicant's husband that the tippers she owned were working in C-hiring arrangements, and that last year they had carried emergency coal under short-term licence and wanted similar facilities this year—" in case there is an emergency ".
But because she could not get carriers' licences, etc., she was forced to take on what work she could to "keep her head above water ".
Mr. Mountain said that he felt he could just make a living out of the 31s. a ton rate, though his calculations did not include any depreciation for the vehicles which could not be replaced after they were " finished ". He told solicitor Mr. Ian Jenkins, for the R.H.A. objectors, that he hoped, if the weather became severe and there was another crisis, that the rate would be forced up to an economic level.
Evidence was given by the distributors and the C.E.G.B. which amounted to this: that the coal was delivered at a fixed price between the Coal Board and the C.E.G.B., and that the profits had to come out of the haulage of the coal. There was, apparently, a duty to the Consumer to accept the lowest rates. It was agreed that " the first thing to be cut" was the haulage rate and that the more operators who would carry at 31s. a ton, the merrier.
The C.E.G,B. official admitted that the only way a distributor could make a profit was from the haulier, and if he did not get cheap haulage then the distributor would not get the job from the Board.
After hearing evidence from local
R.H.A. hauliers who said they could do some of the work if the rate was an economic one, Mr. Nelson—as fair as ever—expressed his sympathy with the applicant and suggested that, in some way or another, she might be able to obtain a B licence for the work already being done under C-hiring arrangements. He did not want to criticize the distributor or the witness from the C.E.G.B. —" he has his duty to do to get his traffic carried, and if people quote a rate which doesn't enable them to keep their vehicles maintained, that is their lookout".
Furthermore, Mr. Nelson went on, it was no part of his duty to " featherbed " existing hauliers-only to see that he did not create excessive facilities. And in considering that, he said, he had to have regard, amongst other things, to the rates.
Not surprisingly, the application was refused, and Mr. Nelson indicated that he would keep the R.H.A. and Railways informed of any further short-term applications in his area, which he would look into if there was opposition.
A Thorny Question The question of rates, generally, is a thorny one and, no matter what is considered to be an economic rate, there is always someone who will undercut. It was for this reason that Parliament sanctioned a rates clause in the 1960 Road Traffic Act because "the holder of the licence has been persistently charging ... sums insufficient to meet the cost of rendering those services, and has thereby placed other holders of carriers' licences at an undue or unfair disadvantage in competing with him as respects the carriage of goods by road" (section 178 (1) (e)).
The most lamentable thing about the case is that hauliers are already doing this work at the uneconomic rate and perhaps it is as well for them that the witness declined to name them. I would suggest that it is encumbent upon anyone with the interests of the industry at heart to inform the R.H.A. or the Licensing Authority's office if they know of anyone carrying out this work at these rates. Undoubtedly, on Mr. Nelson's decision in this case, an inquiry could be called, under the above-quoted section of the Act. Only in this way could the rate be forced up to an economic one.
The question so often posed when considering rates is: "Well, what is an uneconomic rate? ". In this particular case, Mr. Nelson has provided an answer.