Examination of Witnesses (Questions 500
- 519)
WEDNESDAY 29 MARCH 2000
MR JOHN
NEWTON, MR
EDWARD STOBART,
MR EDWARD
RODERICK AND
MR VAUGHAN
WOOLFITT
500. So you just outsource wherever you can?
(Mr Newton) That is right.
501. Do you have agents who conclude those contracts
for you?
(Mr Newton) Yes. We have agents that supply us with
vehicles as well. We have our business partners based in Barcelona,
Madrid, Irun, Milan, Lisbon.
502. Do you do contracts both in and out?
(Mr Newton) Yes.
503. So you are responsible for all of that
work?
(Mr Newton) Absolutely, but it is now operated on
mainland European vehicles as opposed to English vehicles.
Miss McIntosh
504. And jobs would have been lost?
(Mr Newton) Jobs have been lost in our company.
505. Being a cynic I have noticed that every
year a month or two before the Budget the pump prices tend to
go up and they always say it is reflecting the increase in the
oil price. Do you believe a mechanism should be put in place to
protect your industry from the fluctuations in increased oil prices?
(Mr Newton) In crude oil prices. That would be nice
in theory. I think you would probably have a difficulty in exercising
it with regard to the large oil companies.
506. I do not know if you have this figure but
could you say what proportion of the tax was paid by road users
in your industry during 1999 by the road haulage industry, and
in answering that could I also ask if you would be in favour of
the Brit-disc or the Euro-vignette as a solution to non-British
EU vehicles?
(Mr Newton) I do not believe I have got the figure.
507. Could you give it to us in writing?
(Mr Newton) I am sure we could find it.
(Mr Roderick) Could you repeat the question just to
clarify exactly what you mean by that?
508. It is the hypothecation that presumably
you are paying much more into the VED and fuel duties that are
being paid on the road. I just wondered if you had a figure of
what proportion of the tax paid by road users during 1999 was
paid by the road haulage industry.
(Mr Roderick) The total tax in that year?
509. Yes.
(Mr Roderick) No, I have no idea on that.
510. Do you as representatives of your industry
see the Brit-disc as a solution to non-British EU vehicles using
our roads?
(Mr Newton) I would. I think our industry would love
to see it for two reasons. First, it would, if I could coin Mr
Roderick's phrase, give us a more even playing field. Secondly,
of course, it would give the government of the day additional
revenue, first in the hope of reducing our own taxation, and secondly—
Chairman
511. There has been of course a reduction in
tax, has there not, in the Budget?
(Mr Newton) It would be nice to see a reduction in
taxation as well.
512. The VED has gone down.
(Mr Newton) Yes. It would also give the vehicle inspectorate
an opportunity to stop and check some of the vehicles that are
coming into the UK with regard to tacho discs and also with regard
to vehicle maintenance.
(Mr Roderick) Could I comment further on both Miss
McIntosh's comments and your later one? The problem we see with
the Euro-vignette is not that we would not like it applied; we
would, but I think it is limited by statute in Europe as to the
amount that can be applied and I do not think that that bridges
the gap against the Europeans and the level that we currently
see with that.
513. What do you think is the gap? If you say
that one of the reasons why you are so efficient is that you put
in this high level of IT, you have presumably planned running
with your contracts, you do not run empty, all the sensible things,
what is the difference basically between you and your opponents?
(Mr Roderick) I was answering the specific question
on fuel and fuel duties. We pay something of the order of £25,000
a vehicle, whereas with the French it is, say, £14,000 or
£15,000, and the Euro-vignette may have an impact on the
individual load charging but it would not bridge the gap against
the cost per load as against the foreign operator. In terms of
your second point about the taxation in the Budget, yes, we were
pleased to see the escalator was not exercised in full. Inflation
was applied and there was a reduction in VED. However, you have
to bear in mind that during this year, with the change in crude
oil prices, we have seen something in excess of 25 per cent increase
in the cost of fuel and as about 80 per cent of that cost is taxation
anyway, I am sure the government have collected significantly
more than they would have dreamed of at the beginning of the year.
Mr Donohoe
514. Surely that must lead to a situation where
you want to have more efficient vehicles than you do?
(Mr Roderick) We always want to have more efficient
vehicles.
515. Perhaps what has happened is that the escalator
has not been great enough and it has been argued by those that
are mechanical engineers that it was not high enough, that it
did not drive you to bringing in more efficient vehicles.
(Mr Roderick) The comments that would apply to that
are first of all the EC is bringing in changes in the types of
engines that we have anyway and we are abiding by that and we
wish our industry to become more efficient all the time. We all
put air dam kits on, we put computer controls on the style of
how our drivers drive our vehicles, not everything that somebody
would like in their motor car, may I say. We put all sorts of
controls in to make ourselves more efficient. The fact is that
you are seeming to suggest that it may drive vehicles off the
road.
516. I do not say that at all. I am saying the
opposite. I am saying that there is an onus on you, given the
situation, given the reasons that were argued at the time of the
introduction of the escalator, that it was because we wanted to
drive down the inefficiencies that there were in terms of the
vehicles and the way that they were being driven. What I am looking
for from you is an answer to suggest that since the escalator
was introduced the efficiencies have improved by 30 per cent,
40 per cent and that evidence is not around, is it?
(Mr Roderick) I do not think that the efficiencies
that we have generated have been anything to do with the fuel
escalator. I think there are two reasons why we get more efficient.
The first one is that we try to maintain the ability to make a
profit, and secondly our clients expect us to become better at
what we do, whether they be food retailers or manufacturers, and
they wish us to be environmentally friendly in the operations
that we do. However, the point that we have is that we are an
essential service. Everybody likes to go and buy products in shops
and we do not operate on vehicles because we choose to operate
on vehicles. We would love to use railways or barges or coastal
shipping or any other efficient and friendly method, but the fact
is that 90 per cent of road journeys are less than 50 miles and
as a result of that we cannot take vehicles off the road. We have
not caused the congestion on Britain's roads.
517. The problem is that you are not taking
anything off the road and there are still inefficient vehicles
on the road. That is the problem, is it not, that it has not been
addressed as it might have been?
(Mr Roderick) I can only speak for myself and my colleagues.
We all operate efficient fleets. One of our concerns as an industry
is that we need better control by government to ensure that inefficient
vehicles are taken off the road.
518. So you would argue that there should be
far more checks?
(Mr Roderick) Absolutely. We are a professional industry
and we would like to be seen to be so.
519. What proportion of your lorries that are
operating in the United Kingdom operate on the higher rate of
vehicle excise duty?
(Mr Stobart) In the Stobart fleet I run a thousand
vehicles and 75 per cent are 42-tonne gross.
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