Carriers ’cut throats'

Press, 21 August 1976, Page 9

Carriers ’cut throats'

The owner of a local transport firm believes that large trucking companies in Canterbury are “cutting each others throats” for work. The man, who declined to be identified, has retired after 45 years in trucking. He has represented a sector of the industry at transport licensing hearings. He asserts that large local firms are undercutting each other for contract work. Cuts in National Roads! Board grants and other Government funds had led to a sudden decline in the amount of work available for general cartage firms, he said. As a result, the larger! i firms were offering uneco-j gnomic tenders for contract 'work in an effort to keep ! employees and vehicles working, he said. The rates I were uneconomic, but the firms were at least getting some return. One of the consequences was that firms could not compete with the forced low rates, for which larger firms could compensate in other services. In doing this, the firms! were penalising the public,! he said. “Official cartage rates in other areas are in some cases nor being adhered to.” He is also sympathetic to the Drivers’ Union claim that, its case for a wage rise is covered by the "exceptional circumstances” clause of the VZage Regulations. Employers will not agree to a joint approach to the Industrial Commission to test this. He believes that they simply cannot afford to pay higher wages. Another factor contributing to trucking firms’ problems is the surfeit of licences, he asserts. Part of the excess is because of the curtailment of motorway and construction work. But he also suggests that Government policy encour-

ages manufacturers, creating competition among transport firms by ensuring that cartage rates are kept relatively low. Licensing authorities have been issuing more licences than required, and the Ministry of Transport’s policing of the use of licences has been lax. he says. He adds that there is a loophole which allows the undercutting. "In the rate schedule, any firm doing more than a! stated value of work in one year for one organisation is permitted to give a 10 per cent rebate in cartage rates. Larger transport operators in Canterbury — purporting to represent general operator opinion — lobbied the Government to allow a special interpretation of the regulations. These in effect mean that provided the conditions are met, any quantity of work can be done for the stated value.” The regional secretary of the Ministry of Transport’s Road Transport Division (Mr D. L. Hogan), said policy had not changed. “We are policing the operation of licences exactly as we have always done. “If the owner in question would notify the Ministry of cases where he believes licences were not being operated, they would be investigated. and referred to the Licensing Authority for review.” An authority held a judicial position similar to that of a magistrate, and was not subject to political control, he said. He was answerable only to the Licensing Appeal Authority, and decided solely according to the evidence presented at the hearing of licence applications and within the framework of the regulations. Almost every rate schedule

in the country allowed for contract rebates, Mr Hogan added. The president of the Christchurch Road Transport As-I sociation (Mr G. D. McCormick), said that there would! always be competition in in-; dustry. “That’s business." But he said he could not; see any truth in the allegations. “He is virtually saying thatl bigger operators are squeezing smaller ones out of busi-l ness. I don’t know of any 1 who have been forced into that position.” j Mr McCormick dismissed the suggestion that higher |than scheduled rates were beling charged in some areas. He also disagreed with the suggestion that there was a surfeit of licences. “At a recent meeting of the association there was a com-; plaint that the Licensing] J Authority for this district was |more stringent than in any jother part of the country.” ■ The secretary and members of the association were present at every licensing hearing. It would be in their own interests to ensure that too many licences were not issued. He said the remarks concerning larger operators’ purporting to represent the smaller ones were “most unjust.” If it were not for the time and expense that larger companies could afford to spend, the industry would be poorly represented, he said.