THE RESTRICTION OF ROAD HAULAGE

AuthorP. E. Hart
DOIhttp://doi.org/10.1111/j.1467-9485.1960.tb00137.x
Publication Date01 November 1960
Date01 November 1960
THE RESTRICTION
OF
ROAD HAULAGE
I.
INTRODUCTION
FREE
enterprise in the road haulage industry was severely restricted
by the Road and Rail Traffic Act
1933,
which made it necessary
for
would-be new entrants to obtain special licences before they could
operate. Hauliers wishing to carry other firms’ goods applied for an
‘A’ licence, those wishing to haul both their own and other
firms’
goods applied for a
B
licence, and manufacturers wanting
to
carry
their own goods (the ancillary users) applied for a
C
licence, which
prohibited them from carrying other
firms’
traffic. Licences were
granted by special Licensing Authorities for Goods Vehicles, set up
under the Act, provided that existing transport facilities (which in-
variably meant the railways) were inadequate for the work which the
applicant intended to do. This provision was interpreted in the tech-
nical sense; the fact that a newcomer could do the same work more
cheaply was not regarded as a reason for allowing him to enter the
industry. Moreover, established hauliers had
to
apply to the same
authority for permission to expand their vehicle fleets, and were
opposed by the railways
on
the same grounds.
The decision to legislate against the expansion of road haulage, a
young and rapidly growing industry providing a very convenient ser-
vice, was reached after the deliberations of a Royal Commission
on
Transport,’ under the chairmanship of Sir Arthur Griffith-Boscawen,
and after the report of a Ministry of Transport Conference,* chaired
by Sir Arthur Salter. The Conservative Government, the Labour
Opposition, the railway companies, the representatives of road hauliers,
and
the trade unions all agreed that such restriction was necessary.
In the face of widespread agreement among such conflicting interests,
it may seem difficult, even impertinent, to question the conclusions
reached by a Royal Commission and a Ministry of Transport Con-
ference of experts. However, it will be shown that much of the evi-
dence presented to them was based on general impressions rather than
established fact and cannot by any means be regarded as author-
itative.
In the sense that it deals with the arguments current
30
years ago
this paper is mainly historical, but the question
of
restriction is highly
Final Report
of
the
Royal
Commission
on
Transport,
The Co-ordina-
Report
of
the Conference on Rail and
Road
Transport
(Ministry
of
tion
and Development
of
Transport
(Cmd.
3751,
1931).
Transport, 1932). 116
THE RESTRICTION
OF
ROAD
HAULAGE
117
relevant to the present day debate
on
the nationalization, denational-
ization, and renationalization
of
road haulage. After all, the exponents
of
nationalized road haulage have a powerful argument when they
point out that the alternative in practice is not free competition, but
competition among a privileged group of licensed hauliers protected
from new entrants. Again, the question of licensing
is
important even
in
the present system of partial nationalization. The Conservative
Government’s Transport Act 1953 made it necessary for nationalized
road haulage (British Road Services) to obtain carriers’ licences under
the 1933 Act, in accordance with its policy of establishing competi-
tion
on
equal terms between nationalized and private enterprise road
haulage. The Labour Party hopes to repeal this provision, as part of
its programme for renationalization, and free British Road Services
from the restrictions
of
the
1933
Act.
If
returned to office, the Labour
Party also plans to make it more difficult for manufacturers to obtain
C
licences to carry their own products in their own vehicles, recog-
nising that nationalized transport has more to fear from the competi-
tion of this type than it has from non-nationalized road hauliers.
An
alternative approach to this problem of licensing and nation-
alization would be to abolish the licensing provisions of the 1933 Act
and to allow nationalized road haulage, private enterprise road haul-
age (including new entrants), and the ancillary users to compete freely
with each other.
In
addition to the theoretical advantages of such a
policy, which attract economists, it would have the important practical
advantage
of
solving the controversy
on
the appropriate degree
of
nationalization, ranging from zero to 100 per cent., which plagues the
industry as each political party in turn wins an election and re-
organizes road haulage to suit its own political taste. Under such
a
system of free competition-retaining all the provisions of the Acts
of 1930 and 1933 governing speed limits, drivers’ hours, fitness of
vehicles, etc.-nationalized road haulage would tend to expand
if
it
were more efficient, and contract if it were less efficient, than other
hauliers.
The objections to this alternative policy are based on the findings
of
the Royal Commission on Transport and the Salter Committee,
namely that licensing
is
necessary to prevent
a
return of the allegedly
chaotic conditions in the industry which were prevalent in the inter-
war years.
A
re-examination of these findings is therefore relevant to
present-day policy.
The reasons advanced for the restriction of road haulage may be
divided into three main arguments
:
first, that the industry was in some
sense unstable and needed regulating; secondly, that owner-drivers
were
a
menace on the roads, owing
to
their excessive hours
of
work
3

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