1Introduction
Our inquiry
1.Road Haulage Operators recruit drivers to:
- meet current levels of demand (including significant seasonal variations);
- replace drivers leaving the sector (because they move to different jobs in the sector, move to other industries and sectors, or retire); and,
- respond to growth in demand.
2.Some of these challenges can be addressed by using existing resources (drivers, vehicles, facilities) more efficiently. But this approach can only be taken so far and road haulage operators and the Government are concerned about a shortage of skilled, professional drivers. This is not just a UK phenomenon and other countries have similar shortages.1
3.The Committee announced an inquiry into skills and workforce planning in the road haulage sector in September 2015.2 Details of those who submitted evidence and appeared before the Committee can be found at the end of this Report and on our inquiry webpage, which also hosts the evidence we have received and transcripts of our evidence sessions.3 We are grateful to all those who took the time to submit evidence and help us with our inquiry.
An overview of the road freight sector
Economic contribution
4.The UK economy depends on road haulage to move materials and goods around the country and for their import and export. Road freight is estimated to have contributed around £11.2 billion to the UK economy in 2014, a 16% increase on the previous year.4 Almost everything that people use in their daily lives has, at some stage, been transported by a large goods vehicle. Most domestic freight is carried by road (151 billion tonne kilometres of goods moved5 compared to 23 and 29 billion tonne kilometres for rail and water respectively).6
Figure 1: Composition of domestic road freight
Source: Department for Transport, Statistical release – Domestic Road Freight Statistics, United Kingdom 2014, 26 November 2015
5.Goods moved by road to or from the UK decreased by 9% in 2014 and, for the first time since 2000, exported road freight has exceeded imports. The number of goods vehicles and unaccompanied trailers travelling to mainland Europe from the UK rose by 8% from 2.7 to 2.9 million between 2013 and 2014.
Operators
6.Road haulage companies need an operator’s licence from the Traffic Commissioners.7 The number of operators in Great Britain has fallen steadily from 110,000 in 1999–00 to 76,000 in 2014–15. Around 8,000 Heavy Goods Vehicle (HGV) Standard International (SI) Operator Licences are in issue in Great Britain, around 43% fewer than in 1999–00 when just under 14,000 licences were in issue.8
7.The Greater London Authority told us the road freight market was characterised by a large number of hauliers, low barriers to entry and exit, extreme price competition, and clients passing off risk to logistics operators.9 They said this had created a downward pressure on freight rates making it harder for logistics operators to invest in driver training and professional development. The sector has a number of large and hundreds of smaller operators; the very tight margins within the industry may make it particularly hard for smaller operators to compete.10 Jolyon Drury, Chair of the Public Policies Committee, Chartered Institute of Logistics and Transport (CILT), and Adrian Jones, National Officer for Road Transport and Logistics, Unite the Union, made clear the extent to which hauliers face pressure from supermarkets and other retailers where transport costs are seen as on-costs and not core business; some retailers are looking to outsource in-house transport functions.11 Jolyon Drury said competition between the four large supermarkets would put ‘enormous pressure’ on road haulage operators not to put up prices.12
Figure 2: Goods vehicle operator licences in issue and average fleet size, Great Britain, 1999–2000 to 2014–15
Source: Department for Transport, Statistical release – Domestic Road Freight Statistics, United Kingdom 2014, 26 November 2015
LGV vehicles
8.Around 470,000 large goods vehicles over 3.5 tonnes are registered in the UK, although only about 390,000 of them are taxed as goods vehicles.13 There has been a shift towards the use of larger vehicles; goods moved by large rigid lorries (over 25 tonnes) and large articulated lorries (over 33 tonnes) increased by 67% and 49% respectively between 1990 and 2014. Over the same period goods moved by small rigid lorries and small articulated lorries declined by 86%.14
Figure 3: Growth in LGV and van traffic since 2010
Source: Department for Transport, Road Traffic Estimates: Great Britain 2015, 19 May 2016
9.Light van traffic has increased to its highest level ever (but not all such vans will be carrying freight).15 The growth in van traffic might be due to the growth in internet shopping and home deliveries, changes to taxation rules for vans and cars making vans a more attractive option for some people, and the relatively lower financial and regulatory costs of vans compared to LGVs, encouraging businesses to substitute vans for LGVs.16 Drivers of light vans do not need an LGV licence.
Employment
10.Around 13% of the two million people who work in logistics are employed in the road haulage sector.17 In 2005 around 329,000 people worked as LGV drivers. This fell to 259,000 in 2013 following the recession but has since grown to around 288,000.18 Most of them are employees and only around 33,000 are self-employed.19 Adrian Jones, from Unite the Union, said there was a clear trend away from being an employee towards being self-employed;20 this is a general trend in the economy.21 There are also significant seasonal variations in demand for drivers that create a dependence on agency and foreign drivers. Some 60,000 foreign lorry drivers are thought to be working in the UK.22
11.Across Europe the logistics sector is highly integrated. Operators cooperate with each other making use of shared distribution centres and ‘white fleets’ (those without livery used on multiple contracts) to move goods.23 The use of white fleets and shared distribution centres, while primarily a response to the need to lower carbon emissions by reducing empty running, had some effect on the number of drivers that are needed. However, the single biggest factor affecting levels of employment in recent years has been the economic recession of 2008.24 In the next few years it is likely to be the as yet unknown effect on the economy of the UK’s withdrawal from the EU.
Licensing
12.Anyone wishing to drive an LGV must apply to the Driver and Vehicle Licensing Agency (DVLA) for provisional entitlement to be added to their driving licence before taking lessons and sitting the necessary theory and practical driving tests.25 Different driving licence entitlements are needed for vehicles of different sizes and trailer combinations (see Table 1); the categories are harmonised across all EU member states. Drivers who passed a car test before 1 January 1997 have Categories C1 and C1+E through implied rights. All UK LGV licence holders must undergo a medical examination and eye test on application, at age 45 and every five years thereafter. On reaching 65 years of age, a medical examination must be performed once a year. Any delay by the DVSA in processing medical renewals will affect the number of available drivers.
Table 1: LGV licence categories
|
Category |
Description |
Examples |
|
|
C1 |
Weighing between 3,500 and 7,500kg (with a trailer up to 750kg). |
|
flatbed, box body or refrigerated medium sized goods vehicles |
|
C1+E |
C1 category vehicles with a trailer over 750kg, but the trailer – when fully loaded – can’t weigh more than the vehicle. The combined weight of both can’t exceed 12,000kg |
|
|
|
C |
Vehicles over 3,500kg (with a trailer up to 750kg) |
|
Rigid large goods vehicles |
|
C+E |
Category C vehicles with a trailer over 750kg |
|
Articulated lorries and rigid lorries with a trailer (equivalent to old HGV Class 1; covers all articulated and drawbar trailer combinations) |
Source: DVSA, Driving licence categories [accessed on 20 July 2016]
Driver Certificate of Professional Competence
13.To drive an LGV for a living, a driver must obtain a Driver Certificate of Professional Competence (CPC),26 after which they can be issued with a driver qualification card (DQC). The aim of Driver CPC is to improve road safety and help drivers become more professional in all aspects of their work. To retain their qualification drivers must complete 35 hours of periodic training every five years. They can be fined up to £1000 for driving an LGV without a certificate.27 Some LGV drivers do not need to complete the Driver CPC, for example if they are driving a vehicle:
- used by or under the control of the armed forces, police, a local authority, fire and rescue authority or prison service;
- used for driving lessons or driving tests;
- used for non-commercial carriage of goods; and
- carrying material or equipment to be used in the course of the driver’s work (such as a bricklayer who needs to drive a lorry with bricks to site but for whom driving is not the main part of their job).
Additional qualifications
14.Drivers of vehicles carrying dangerous goods or tankers in the oil industry need additional specialist qualifications. Under the European agreement on the carriage of dangerous goods, drivers of vehicles with tanks and certain tank components, and some drivers of vehicles carrying dangerous goods in packages, must hold a special vocational certificate of training, sometimes referred to informally as an ‘ADR Certificate’.28 The Petroleum Driver Passport (PDP)29 is an industry initiative that ensures tanker drivers in the UK are trained to a high standard and regularly assessed. The passport is renewed on a five year cycle, but also has an annual refresher requirement.30 It is not illegal to drive a tanker without a PDP but drivers without one cannot access terminals to load or unload.
2 Transport Select Committee, Committee launches road haulage sector: skills and workforce planning inquiry, September 2015
3 Transport Select Committee, Road haulage sector: Skills and workforce planning inquiry
4 Department for Transport, Statistical release – Domestic Road Freight Statistics, United Kingdom 2014, 26 November 2015
5 Goods moved is a measure of activity taking into account the weight of the load and distance through which it is hauled. It is equal to the weight of goods multiplied by distance and is measured in tonne kilometres.
6 Department for Transport, Statistical release – Domestic Road Freight Statistics, United Kingdom 2014, 26 November 2015
7 Traffic Commissioners for Great Britain, Goods vehicle operator licensing guide (GV74), April 2013
8 Department for Transport, Statistical release – International Road Freight Statistics, United Kingdom 2014, 26 November 2015
13 LGVs used unladen, privately or for driver training purposes are taxed in the Private HGV class. There are other exemptions for special use vehicles.
14 Department for Transport, Statistical release – Domestic Road Freight Statistics, United Kingdom 2014, 26 November 2015
15 Department for Transport, Road Traffic Estimates: Great Britain 2015, May 2016
16 Department for Transport, Road Traffic Estimates: Great Britain 2015, May 2016
17 UK Commission for Employment and Skills, Understanding Skills and Performance Challenges in the Logistics Sector, October 2014
19 Department for Transport, Statistical release – Road freight economic, environmental and safety statistics, 19 February 2015
21 House of Commons Library, The self-employment boom: Key issues for the 2015 Parliament, May 2015
25 The terms Large Goods Vehicle (LGV) and Heavy Goods Vehicle (HGV) are both used in regulation to describe freight vehicles over 3.5 tonnes. The terms are interchangeable and both appear in the evidence. LGV is used in this report as this is the term used for licensing.
26 See European Directive 2003/59/EC
28 European Agreement concerning the International Carriage of Dangerous Goods by Road, ECE/TRANS/242, Vol. I and II
29 Petroleum Driver Passport [accessed on 6 July 2016]
© Parliamentary copyright 2015
27 July 2016