Budget 2015: Osborne Stops Short of Training Fund Commitment

budget-briefcase_1663222cEarlier this month, Chancellor George Osborne presented the government’s 2015 Budget. With the Road Haulage Association (RHA) and Freight Transport Association (FTA) lobbying for the provision of a £150m fund to support the training of new drivers, it was hoped that the government would take action to address the driver shortage crisis facing the transport industry.

While such a commitment was not forthcoming, George Osborne did however reference the issue, at least showing that it was on the government agenda. The budget stated:

“The government will review the speed with which Heavy Goods Vehicle (HVG) driving tests and driver medical assessments currently take place and consider options to accelerate both in order to help address the shortage of qualified HGV drivers.

“The government will also work with road haulage firms on an industry led solution to the driver shortage, including looking at the right level of access to, and funding support for, training.”

Around the time of the budget, a Department for Transport spokesman said “Increasing the number of qualified lorry drivers is good for British business and good for growth. The government will do all it can to find ways to support this sector and we are working to find industry-led solutions to ensure sufficient drivers to meet the demand.”

The industry currently faces a shortage of approximately 60,000 drivers, with the issue only set to get worse as drivers retire. Of the 326,000 licensed drivers, 175,198 (that’s 53%) are aged between 45-59. By comparison, only 5,244 are aged 18-24.

It is clear that the issue is a critical one for the industry, but for the government as well. Hauliers and transport operators power the UK economy and the driver crisis has already led to concerns that the supply of goods to retailers for example will be affected, especially around peak periods such as Christmas.

The introduction of the Driver Certificate of Professional Competence (or CPC) has brought the issue into focus, with some estimates indicating that 20,000 drivers left the industry as a result of the training requirement, either retiring of choosing alternative careers.

On a more positive note, in the budget was also included the cancellation of the fuel duty increase that was scheduled for this September, though again there was no commitment to cut fuel duty or confirm that no rises would be applied post-election.

Between 2011 and 2016, a typical motorist will have saved £675, the Treasury has calculated. It means a saving of £1,400 for a small business with a van, and £21,000 for a haulier.

On the budget, both the RHA and FTA commented.

Richard Burnett, Chief Executive of the RHA: “RHA chief executive Richard Burnett said: “We have put forward a strong, clear argument for why funding is necessary and appropriate. Our lobby for funding support will be even stronger in the coming weeks.

“I would like to thank the many RHA members and other organisations who have supported our lobby and continue to do so. Meanwhile, the RHA is committed to pressing ahead with its programme of advising members, promoting the industry and working to improve drivers’ conditions.

“We note the continued, freeze on fuel duty which was expected. Had he reduced duty (as he did with alcohol) he would have boosted growth and employment as demonstrated through the independent, RHA-funded, NIESR research.

“The continued freeze on HGV vehicle excise duty is an appropriate recognition of the vital role trucks play throughout the economy”.

James Hookham, Managing Director of Policy and Communications:

“FTA members will be pleased and impressed that two issues raised at our Driver Crisis Summit have been so swiftly addressed. Speeding up driving test bookings for truck drivers and medical assessments will help us get qualified drivers on the road quicker and more reliably helping industry address its shortfall of 60,000 drivers. We look forward to seeing this implemented as soon as possible.”

“Logistics is suffering a huge shortfall of drivers which, if not addressed, will act as drag on the economic growth the Chancellor wants to see. FTA welcomes the moves to speed up the processes associated with getting HGV drivers on the road as excellent news. But solving this in the longer term means attracting more young people to the industry.

“The cost of acquiring the necessary licence (£3,000) acts as a major barrier to many young people and we are pleased that George Osborne will work with industry to ensure funding can be provided to overcome this problem.”