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ACHIEVING STABILIZED R ES FOR COAL HAULAGE

6th July 1940, Page 26
6th July 1940
Page 26
Page 27
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Page 26, 6th July 1940 — ACHIEVING STABILIZED R ES FOR COAL HAULAGE
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Which of the following most accurately describes the problem?

yORKSHIRE, in the way it has dealt with the problem of stabilizing rates for the road haulage of coal, has set an example which, in my opinion, should be followed elsewhere and in relation to all traffics of a like nature. The scales of charges agreed upon in that county can be accepted as models in respect of their practicability, reasonableness and widespread application.

I am proud, indeed, to be able to claim that I had a substantial share in that work, in that the figures which I derived from an original and ad hoc investigation of that haulage on the spot, formed the basis for this agreement.

The coat trade, in so far as it concerns road transport, is sharply divided into two distinct sections—dealings in industrial coal and in household coal. The former is delivered in bulk direct from pits to factories, the latter usually in bags, to houses. There is a third class, the delivery of colliers' coal, but the tonnage involved is small in proportion to the total. Consideration of this third aspect is no part of My present purpose.

The chain of events leading to this successful effort to establish coal-haulage rates on a satisfactory basis, is not one which can be regarded with any sense of pleasure or pride by either coal merchants or by hauliers. There is little doubt, however, that the latter are largely to blame. The story, in its essentials, is a familiar one. It is, in miniature, the history of the road haulage industry, with particular refemnce to rates and the misuse of rates.

An attempt to control the price of coal, by fixing prices at the pithead, was frustrated by the rate-cutting tactics of road hauliers, aided and abetted by some of the coal distrikutors. The story, as told me by

prominent coal distributors, is a familiar one. Hirepurchase, gross overloading, excessive hours of work. and, in many cases, inadequate wages, were factors in reducing transport costs to an uneconomic level. Even when attempts were made to establish the industry on proper lines, owner-drivers, under-valuing their own labour, and with an entire disregard of costs, stepped in and again cut the rates.

Another effort, with the same end in view, provided for the fixing of coal prices at the point of delivery, that is to say the price fixed was to include the cost of transport. The road-transport industry, however, continued to be the butt of distributors who were desirous of turning this new situation to their own ends.

In this attempt, the co-ordination of price within the coal trade took into account varying costs of delivery, as between pit and pit, and district and district. Naturally, the factor of road rates was one of primary importance. The whole question of delivered price co-ordination is tied up with road-transport rates.

It was when this factor came fully to be realized that I was invited to carry out the investigation to which I have referred. My object was that of ascertaining the effect on costs of terminal delays, and the proportion of time wasted and dead mileage, that is to say, the time lorries are standing idle at the pits and the mileage not directly chargeable against deliveries. Both of these losses—time and mileage—are unavoidable and arise out of conditions under which collections and deliveries are affected.

The investigation covered some months, and I visited collieries, noted times of loading and unloading, taking a special note of the difficulties and delays at terminals. I analysed the log sheets of vehicles as a check upon my own observations, and with particular reference to the time spent in the garage, because of the impossibility of collecting additional loads within the legal limits of working hours and vehicle speeds.

I also examined, in detail, the operating costs and records of 58 vehicles of different sizes and capacities. The results of that examination are set out in Table I; the figures are the averages of those acquired in the course of my investigation.

Vehicles of road capacities other than 4-tonners were included, but as this is the typical and most frequent load it was decided to adhere to those figures throughout. Larger vehicles cost more to run, and that is compensated for by the fact that they carry a bigger load.

Using these figures of operating costs as a basis, a preliminary set of rates was shown, as in Table II. Examination of the conditions had shown that an average charge of 6d. per ton for terminal delays would meet the circumstances. The problem, common to all traffics involving particularly short leads, of providing for excessive delays and traffic interference, was solved by adding is. to the calculated rate for a one-mile lead and diminishing that by ld. for each additional mile lead. In that way, the addition for a two-mile lead was lid., for a three-mile lead 10d., and so on.

These rates were generally accepted, by knowledgeable hauliers and representative distributors, as fair and reasonable. They did not, however, find general acceptance, for the reason that so many hauliers were willing to work for lower rates. To meet this situation and to combat, so far as practicable, the depredations of rate-cutters, a lower and interim schedule of rates was suggested as set out in Table III.

These scales did not, however, meet Vie views of those distributors who had their own fleets of vehicles, kept accurate costs, and knew what rates should be. Here is a reversal of what so many hauliers claim is the general procedure, for, in this case, it was the C-licensee who endeavoured to keep rates up to a reasonable economic level.

Other distributors, however, having no vehicles of their own, and being concerned merely in getting the work done at the lowest cost, irrespective of any consideration of those who did it, agreed to operate according to this schedule (Table III). They were enabled to do so by either beating down the haulier to these suggested rates, or by inducing some to enter into hire. purchase agreements with a promise of full work, either on this level of rates, or at a lower one This conduct aggravated conditions, led to the intensification of competition, overloading, excessive hours of work, and, in many cases, to the forfeiture of hire-purchased vehicles, because of the uneconomic rates.

Further attempts were made, therefore, to arrive at a satisfactory scale of rates, and as a result those shown in Table IV were agreed in June, 1938.

As the structure of this rates schedule is the basis of current scales, it is essential that it should be thoroughly understood. With that end in view, the following explanation is given. It should be emphasized

that the basis -is still the original schedule of running costs and standing charges, as set out in Table I.

The terminal charge of 6d. still stands. A progressive rate of 3d. per ton lead mile is arrived at in this way. The average speed of vehicles is assumed to be 15 m.p.h. That being so, and appreciating that one-mile leads involve two miles of running, the total cost for a onemile lead is 11.8d. made up as follows:—Two miles travelling at 15 m.p.h. is 8 mins., and that at 3s. per hour is 4.8d. The running cost of two miles at 3.48d. (or 3.5d.) per mile is 7d. That total of I I.8d. for 4 tons is equivalent to 3d. per ton per lead mile, and with the 6d. for terminal charges, gives 9d. per ton for the first mile.

The problem of providing for traffic delays, etc., over short leads is met by weighing the schedule in favour of the shorter leads, by the addition of is. 3d. to the first mile, progressing Id. per ton lead mile until exhausted at the fifteenth mile. Thereafter, appreciation of the fact that a little better average speed is possible for long leads is shown by arranging for a corresponding diminution of Id. per ton lead mile on the long distances.

The foregoing procedure and the rates which result, are set out in Table V. It should be appreciated that the whole of these figures and tables of casts are on a pre-war basis, and it now remains to take into consideration the fact of war-time increases in costs. War increases in costs of operation have involved an addition of id. to the basic figure of 3d, per ton per mile lead, so that it now becomes 30. This increase provides for only the original wage scale, which came into operation on January 29, and not for the further increase made statutory on May 6.

The increases provided for, are those arising from higher wages, but more especially from restricted weekly hours of work on the road. Admittedly, the wages apply statutorily to A and 13 licensed vehicles only. More than half the transport of industrial coal in Yorkshire, however, is carried by these types of vehicle, and the same conditions of service are either demanded by, or granted to C-lieence workers, who have the right, under the Act, to appeal td an Industrial Court for equal rates for scale work. This increase of 0. per ton-mile also takes into account increases in the price of petrol, oil, tyres, repairs and maintenance, all items comprised in " running costs."

The actual amount of the increase is 0.5445d., and it is calculated as follows:-The 'reduction of the working day from 9 to 8 hours increases the cost per hour for the vehicle from 3s. to 3s. 4d. On the basis of an average speed of 15 m.p.h. that increases the original figure of 4.8d., as quoted in Table V, to 5.33d. The actual addition is 0.53d. per lead mile, which for 4 tons is 0.14d. per ton per lead mile. Petrol now costs 2d. per running mile, assuming 10 m.p.g., and, assuming Is. Sd. per gallon, which is an equivalent of an increase of 0.64d. per mile, or 0.32d. per ton per mile lead.

The cost of tyres is taken at 20 per cent, higher. which gives an increase of 0.035d. and repairs and maintenance cost is assumed to be no more than 15 per cent. higher, that is equivalent to an increase of 0.0495d. The total of the foregoing is 0.5445d. per ton per mile lead, The schedule of rates embodying the above increases is that set out in Table VI.

There is, in my opinion, distinction to-day for a further increase of at least id. per ton per mile lead over and above the rates quoted in Table VI. This is due to an increase of Ss. per week in wages, and to further increases in the cost of petrol and tyres, and especially to the fact that maintenance costs have increased directly and indirectly, in that spares are so difficult to obtain.

The effect of such delays adds considerably to the time vehicles are off the road; that is an important but not calculable factor in increasing costs. There is, furthei-more, the fact that vehicles are being kept in commission for much longer periods than ordinary economic working would suggest.

That concludes the case for rates for the transport of industrial fuel. The discussion of figures for household coal must be left for another article.

(To be concluded.)

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