Thursday, March 19, 2015

Road Haulage and Freight Interests Have Mixed Reaction to Budget as Severn Tolls Remain

VED and Fuel Duty Stay the Same Whilst Some Possible Help for Driver Shortage
Shipping News Feature

UK – A mixed reaction to the Budget from the bodies concerned with road haulage as they pick apart the fine print to see how it will affect the logistics sector. Obviously the decision to freeze VED on HGVs and a similar policy on fuel duty has been welcomed, but additionally the Freight Transport Association (FTA) has said it is pleased that the government has listened to industry on the subjects of driving tests and medical assessments for HGV drivers. An announcement on Severn Bridge Tolls was far less popular.

The delays in getting test bookings from DVSA and medical assessments from DVLA were key topics at an FTA Industry Summit held last week in Coventry. The ‘Solving the Driver Crisis’ summit saw over 600 delegates from the freight and logistics industry share their experiences of the driver shortage, and focused on tackling the issue of recruiting and retaining professional drivers.

Together with the Road Haulage Association (RHA) the FTA directly lobbied the government with recent meetings with Ministers particularly on the subject of the driver shortage, and this seems to have some, if not all of, the desired effect and now government is to review the speed with which truck driving tests and driver medical assessments currently take place and will consider options to accelerate both in order to help address the shortage of qualified HGV drivers.

The government will also work with road haulage firms on an industry-led solution to the driver shortage, including looking at the right level of access to, and funding support for training. In its pre-Budget submission to the Chancellor, the industry representatives had pressed government for appropriate funding to support for vocational skills in order to help address the current driver shortage problem.

The Chancellor also announced that the unemployment forecast is down, to 5.3 per cent this year. In addition, today’s ONS Labour Market Statistics revealed that 1,345 HGV drivers were claiming Jobseekers Allowance in February 2015, down 56.6% from a year ago when 3,100 were claiming Jobseekers Allowance. This of course merely aggravates the problems in hiring suitably qualified drivers. Discussions have been held regarding a level of government support for those receiving this benefit to be sponsored in apprenticeships in cooperation with employers.

The news that Severn River Crossing tolls are to continue once the concession ends predictably did not find favour and is considered a bitter blow for the freight and logistics industry by the FTA, who said that it is disappointed that the Government has disregarded category 3 tolls (lorries, large buses and coaches) and that it does nothing to address the punitive level of the toll. Ian Gallagher, FTA Head of Policy South West and Wales said:

“The Chancellor’s announcement today is the first confirmation from UK Government that charging will continue after 2018 when the bridge comes into public ownership. Whilst the change to the tolls is seen good news for van and minibus operators, the FTA considers it is a kick in the teeth for the logistics industry as a whole. There are three years of toll increases still to come, by 2018 we anticipate that the toll will be in excess of £20 for HGVs.

“The FTA sees this as a bitter blow for businesses in the south west and Wales which have campaigned for an end to the tolls once the concession ceases. For too long freight operators have had to pay high charges to use the Severn Crossings, which are a vital artery between Wales and England. The money that business spend on paying these tolls could be better invested on driver training or on greener fleets.”

FairFuelUK, which led the fight to bring down fuel costs for all motorists had mixed feelings about the freezing of duty as founder Howard Cox explained, saying:

"Today’s Budget is very welcome that Fuel Duty has been frozen again. FairFuelUK has campaigned relentlessly to show that lower pump prices and in particular cutting duty stimulates GDP, generates new jobs and lowers inflation. But why doesn't the government go further and drive the UK economy continually upwards by cutting duty? We give Mr Osborne 6 out of 10 for endeavour and will continue to campaign that duty should be frozen for the lifetime of the next Parliament with more pressure on a real cut in the Autumn Statement. The Treasury takes nearly 70% in tax and still has not called for a Pump Pricing Inquiry.

“The Chancellor has been extremely lucky because Oil Prices have fallen dramatically and consequential lower pump prices have hidden the huge amount of tax still being paid by 32 million voting drivers. This means the government can take credit and hide behind a continual freeze in this levy. Oil companies get tax relief for their shareholders to benefit from future dividends whereas motorists continue to be fleeced by retailers, speculators and the government. UK Motorists will decide at the ballot box in May which Party is best for them. "