Examination of Witnesses (Questions 560
- 579)
WEDNESDAY 29 MARCH 2000
MR JOHN
NEWTON, MR
EDWARD STOBART,
MR EDWARD
RODERICK AND
MR VAUGHAN
WOOLFITT
Dr Ladyman
560. You have just replied about the capital
allowance to Mr Forsythe. Could you just explain how you would
change the capital allowances?
(Mr Roderick) We would like to see capital allowances
such that if we invest in new vehicles we have got 100 per cent
capital allowance in year one, for example. It would be great.
561. Why would that make you get a 44-tonne
vehicle?
(Mr Roderick) It would not make us buy a 44-tonner.
I was asked particularly about smaller operators and the renewal
of their assets.
562. But why would it make you buy more environmentally
sensitive vehicles, because you could write off gas-guzzling dirty
vehicles just as easily in one year?
(Mr Roderick) Yes, except that you would not be able
to buy them because the manufacturers are supplying Euro II and
Euro III in line with the EC regulations on vehicle emissions.
Mr Forsythe
563. Is there a requirement at the moment for
the particulate trap?
(Mr Roderick) I think there was a short term one applied
to Euro II engines but apparently there was some error in the
documentation in the EEC which is now going to be corrected and
it will be withdrawn again until we get to Euro III engines.
564. Will the duty be increased then to encourage
more people to fit them?
(Mr Roderick) People have to see the benefits on the
fuel savings or the fuel damage that they would get would be compensated
by the tax benefits. We obviously talk about vehicle excise duty
and direct taxation by governments, but obviously there has been
a large move to ultra low sulphur diesel in this country in order
to reduce the amount of particulates.
565. How much less efficient are the Euro III
engines compared to the ones that are working at the moment?
(Mr Roderick) With the ultra low sulphur diesel, which
is a requirement, we have seen about a 3.5 per cent decline in
fuel efficiency in our vehicles, so we are burning 3.5 per cent
more fuel as a result of taking the particulates out of the fuel.
That is another impact upon us.
Chairman
566. Are you saying that that is not true of
vehicles running with eastern German drivers? Is the allegation
that many of the firms taking advantage of the changes are western
German firms using eastern German drivers, or is the allegation
that they are eastern German lorries?
(Mr Roderick) I think the allegation, if that is the
description you wish to use, is that certainly there are operators
who are using non-EC drivers in this country on temporary allowances,
which is disadvantageous, but also we believe that there are less
efficient vehicles coming into this country.
567. So you are saying they are not using vehicles
with Euro III engines?
(Mr Roderick) No. Not all of them but a lot of them.
Dr Ladyman
568. One of the pieces of evidence that we have
received so far suggests that road haulage only meets 70 per cent
of the total costs if you take into account social factors, road
wear, and so on. Even with all these tax problems that you face
you only meet 70 per cent of the total costs that the nation incurs.
How would you respond to that?
(Mr Roderick) It is not a statistic that we are able
to challenge. The first question of any good accountant will be,
"What would you like the answer to be?" It depends which
consultant you employ, does it not, and which point you are trying
to make?
569. Given that you said earlier that you accept
that rail is more environmentally friendly, you would accept then,
I guess, that maybe rail does pay all its environmental and social
costs and the road hauliers do not even if there is a dispute
about the figure?
(Mr Roderick) I have no idea whether it does or not.
It gets subsidised by government and assisted by government so
I have no idea what the total costs are for railways. We just
all believe that it is a more friendly way of doing things because
you can put a thousand tonnes up on a train and it moves and it
does not create traffic jams and it does not participate in the
general situation that we have on British roads, so we are happy
to see more go on to the railways.
570. Given what you said about the majority
of goods on short journeys and they have to travel by road, and
I can understand that, what percentage of what you transport by
road at the moment do you think is available for transfer to rail
if the economic circumstances were right to make it shift?
(Mr Roderick) I would like to shift the question round
in the opposite direction if I may.
571. I am the politician!
(Mr Roderick) We live in hope; you never know. What
I would like to do is reverse it and say, what capacity does rail
have to carry more cargo?
Chairman
572. I think the question was simpler than that,
Mr Roderick.
(Mr Roderick) If we take the Chancellor's view of
the economy moving forward, even if the railways were in a position
to double the amount of freight that they carry currently over
the next 10 years, then I think they do not have the capacity
to do so. That is one of the major issues. We would like to see
more on rail but rail needs to have more infrastructure and more
capacity, more pathways.
Dr Ladyman
573. I suspect most of us here would accept
that argument, that capacity is a problem, and maybe one of the
things we will recommend is that the government addresses that
capacity issue. Government is not going to address that capacity
issue if it does not have a vision that it is going to be able
to shift goods from road to rail. Whatever the split between road
and rail is now, if we address the economic situation, if we address
the capacity issue on the railways, what would you see the balance
being between the two in, say, 10 years' time?
(Mr Roderick) If you take a service and time requirement,
rail is efficient probably over about 250 miles, maybe 200. Therefore,
anything that moves within or beyond that distance would be efficient
for rail, and that would be something like 10 to 15 per cent,
I would imagine, of the total freight which is on the British
roads at the current time.
574. So in your mind if we want to drive the
industry in an environmentally friendly way, the issues that we
should look at are tax allowances to help you replace your fleets
with modern, more environmentally friendly, vehicles, capacity
building on the railway, and then, having built up that capacity
on the railway, are you suggesting that goods would flow naturally
to fill that capacity, or are you suggesting we would then have
to change the tax system again in order to force goods into that
mode?
(Mr Roderick) No. I think if the railways were efficient
and had the capacity available then goods would probably naturally
move in that direction. If you were asking government to do other
things, we would like them to have better road signs, we would
like benefits for moving more of our activity to night which is
less polluting and less congesting. There are a whole range of
areas in which government could help the freight industry to be
more efficient and less polluting as well as moving goods to more
environmentally friendly routes.
Mr Bennett
575. Driver fatigue: how big a problem is it?
(Mr Stobart) If you stick by the rules, which we all
do round this table,—
576. I did not ask you what specifically as
far as you are concerned how big a problem is it, but as far as
the industry is concerned. Are other people breaking the rules?
(Mr Stobart) Yes, they are, about 20 per cent.
577. So you think there should be much better
enforcement?
(Mr Stobart) Absolutely, yes; certainly on the European
ones.
578. What about incentive schemes for drivers?
Cannot they be dangerous?
(Mr Stobart) Yes.
579. Do you use those sorts of schemes?
(Mr Stobart) No.
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