Select Committee on Environment, Transport and Regional Affairs Fifteenth Report


THE ROAD HAULAGE INDUSTRY

CONCLUSION

106. The road haulage industry is vital to the success of a modern economy like that of the United Kingdom. It provides a flexible and efficient means by which raw materials and finished goods can be transported from point to point. As such it plays an integral role in all parts of the supply chain, and the rise of the internet, with all the challenges that poses to the distribution system, means that the road haulage industry's value to the United Kingdom's economy is destined only to increase.

107. As we have set out, the industry faces some difficulties. We are particularly concerned that unequal competition from European hauliers, unfair and dangerous competition from 'cowboy' operators, and the ease with which companies which are not economically viable are able to enter the market threaten to undermine the sustainable market for road freight, and to undercut the responsible companies which make up the bulk of the industry. We have made a number of recommendations to respond to these problems, such as the introduction of a 'vignette' for both domestic and foreign hauliers, better enforcement of safety and other regulations, and the imposition of stricter limits on entry to the industry.

108. Despite the indisputable fact that the road haulage industry is vital to our economy, we note that it is not a very environmentally-friendly or sustainable industry. It remains a significant source of pollution, of greenhouse gases, and of congestion and nuisance, and its activities depend on the use of finite stocks of fossil fuels. We urge the Government and the industry itself to continue to take steps to improve its environmental record, and we have made a number of recommendations towards that end. We also stress the importance of the rail freight industry, and the continuing need to promote the transfer of freight from road to rail. It is essential that more sustainable means of transport than road haulage are encouraged wherever practicable.

109. We have not accepted the principal argument advanced by our witnesses from the road haulage industry, that fuel prices and VED are too high, and should fall. We believe that in the past haulage rates have been unrealistically low, and have not reflected the true costs imposed by the road haulage industry on our society. The real increases in fuel duties, although imposed too rigidly in the face of rising oil prices, have gone some way to creating a sustainable market in road freight transport. If our objective is a safe and clean road haulage industry, which contributes less to pollution and congestion, and which employs well-trained drivers, and a sustainable transport market in which rail freight is able to compete fairly with road haulage, then haulage rates must rise to reflect the true costs of freight transport. The small rise in the end-price of goods (only one or two per cent of the total price[342]) that results is a price that we should all be willing to pay.


342   The Government told us that road transport accounts for 5 per cent of end-product costs in the United Kingdom. Of that, 25 per cent of heavy goods vehicle costs are made up by fuel duty and VED. See RH48, para.17. Back


 
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