First Report - Road freight supply chain

A lack of HGV drivers has concerned Government and industry for more than a decade. Too few people want to work in the sector, and the retention rate for those who become drivers is low. The covid-19 pandemic exacerbated those trends, turning a chronic problem into an acute one. The acute shortage may now be abating, but it is unclear whether progress and capacity will be sustained.

In the past, the Department for Transport argued that the haulage sector itself was primarily responsible for addressing driver recruitment and retention. The unprecedented nature of the recent crisis led the Government to take a different tack. That change was welcome. However, the Government’s piecemeal approach has involved a range of limited and/or temporary measures. Government intervention also gives the impression that the issue of driver shortages is for the Government alone to fix. Whilst the Government has a role to play, this is a private sector industry, and we believe the private sector needs to put its own house in order.

We want to see greater ambition, which means the introduction of a coherent strategic plan. In the five years since our predecessor Committee examined this issue, the sector has failed to solve its own problems. Little to no improvement has been made on a whole range of important issues. The Government must force the pace and end years of industry inertia.

One step the Government should take straightaway, as part of its review of the Driver Certificate of Professional Competence, is to ensure the logistics sector funds its own driver training, as is common practice in the bus and coach sector. It makes no sense that HGV drivers should have to pay their own training fees when we face continued shortages. (Paragraph 23) Retention

Driving an HGV is a challenging job. It is physically demanding and involves lengthy, anti-social hours. The way in which drivers are treated and the conditions in which they are required to work can exacerbate those pressures. Unless these conditions improve, retention rates will remain low. Post-pandemic pay increases can only do so much to improve retention, particularly because the structure of the sector has tended to drive down pay rates in the past.

The Government, in consultation with the sector, should devise a binding code of conduct setting minimum standards for employers’ and other businesses’ treatment of HGV drivers.

Overnight parking facilities for HGV drivers are insufficient, especially on key road freight routes. This lack of capacity is not new; the Department’s previous lorry parking survey identified it five years ago. (Paragraph 35) 32 Road freight supply chain

The Government should use the findings of its current lorry parking survey to set regional targets for building additional parking capacity. It should set up a joint Government-industry taskforce to ensure these targets are met.

Without clear direction from the Government’s planning legislation and guidance, building desperately-needed new driver’s facilities, and even upgrading old ones, is a tortuous process. Local authorities in Kent, and other parts of the country where supply chain movements are prominent, face an impossible task and cannot be expected to elect to provide for lorry parks in their local plans in the face of opposition from residents impacted by such large projects. This is a national issue which requires a national Government fix.

The Government must build on its commitment in the Queen’s Speech to reform the existing planning framework and ensure that decisions for new driver facilities are not left to individual planning authorities. The Government must reform national planning policy to ensure that more driver facilities, which are fit for purpose and industry leading, are delivered. The Government must make an assessment as to whether the demand for new facilities can be delivered with only light reform. If it cannot, the Government should seek to take this dilemma from local authorities and local plans and place the responsibility at a central level. This would rightly recognise these facilities as key national infrastructure assets.

HGV drivers need safe and secure places to stop, to rest and to recuperate. Drivers told us that too often the facilities available to them were unfit for purpose. Rest facilities must be improved if more drivers are to remain in the sector.

The Government should set a minimum standard for driver facilities. This should cover: Ȥ Security to protect drivers and their vehicles; Ȥ Availability and cleanliness of toilet and shower facilities; Ȥ Food options, including healthy choices; and Ȥ Sufficient provision for female drivers.

The Government owns the freehold of a number of motorway service areas. Delays in negotiating leasehold extensions with operators are holding up necessary investments in some of these facilities. While the Government must, of course, ensure it receives value for money, it is disappointing how little urgency it has shown.

The Department should inject more urgency and immediately escalate and prioritise negotiations to agree new leases with motorway service operators operating on Government-owned land.

HGV drivers should not park overnight in laybys or other unsuitable locations. It leaves drivers vulnerable to crime and is not conducive to rest and recuperation. Yet some drivers are forced to do this as managed facilities are full, while others choose to, either to save money or because the available facilities are poor. The only way to tackle HGV parking in laybys is to build new facilities and upgrade existing ones Road freight supply chain 33 to ensure there are enough spaces for all drivers. Only when drivers are not able to argue that there is nowhere else to park should penalties for parking away from managed facilities be increased.

The fragmented nature of the road haulage sector makes it difficult for logistics operators to act in a concerted fashion to improve the conditions for HGV drivers. The actions of a few large companies, such as the major supermarket chains, exacerbates this. These companies use their market power to drive down costs but take no responsibility for the consequences. What is needed is a sector-wide solution, but, so far, despite a lot of warm words, the sector has failed to deliver this. Radical action is required to end this cycle of failure.

In other policy areas, where the Government has run out of patience with inertia, it has threatened industry with actions which would be taken if the industry does not find its own solution. Similar examples can be found in measures brought in to reduce sugar content in soft drinks and the use of packaging which cannot be recycled. The Government should mirror this approach in the logistics sector.

The Government should give the logistics sector two years to deliver sufficient drivers and high-quality parking facilities. If industry does not deliver, the Government should implement the levy charging mechanism and cause the industry to pay sufficient sums for the Government to build these facilities and pay to train new drivers, so they do not have to pay the cost of their own training. Such a mechanism must be accompanied by Government planning reforms in order for the industry to be able to deliver and avoid paying the Supply Chain Levy.

The Supply Chain Levy should be applied to those at the production and sales end of the supply chain, such as large retailers, oil companies and online service giants. These organisations currently make large profits which do not trickle further down the supply chain to the companies which transport the goods. As a result, hauliers and ferry operators are posting operating losses and therefore cannot afford to increase the pay and welfare standards of those they employ. The Supply Chain Levy would require the parts of the supply chain where margins are greatest to deliver improved standards and the resilience to the supply chain which they themselves require to ensure their shelves, warehouses and petrol pumps are full. (Paragraph 59) Recruitment

The average age of HGV drivers continues to increase. Although the sector is perhaps more open to female drivers than in the past, it has largely failed to attract a diverse workforce. It is disappointing how little progress has been made since our predecessor Committee reported five years ago. That 1% of drivers are women, and only 3% of drivers are under the age of 25, should be a cause for shame for the industry and a clarion call to do more. The Supply Chain Levy we recommend, and resultant improvements in training and facilities, should assist in improving these appalling ratios. In addition, the sector must redouble its efforts to attract and retain a diverse workforce. (Paragraph 63) 34 Road freight supply chain

There are various routes to becoming an HGV driver. The sector does not find it difficult to recruit new entrants. It has struggled to make apprenticeships work as an entry point, because the role does not fit within the parameters set by the Department for Education’s various arm’s-length bodies such as the Institute for Apprenticeships and Technical Education and the Education and Skills Funding Agency.

We welcome the introduction of skills bootcamps as a faster, more flexible route to becoming an HGV driver. The Government should make the provision of skills bootcamps for HGV drivers permanent, with part of the scheme targeted at underrepresented groups in the current workforce. That policy could be funded from the sector’s apprenticeship levy contribution. (Paragraph 70) Infrastructure

We welcome the steps the Government have taken to get more freight off our roads and on to our railways. We hope this is a process the establishment of Great British Railways will accelerate. The current model which sees freight moved from one end of the country to the other by road is illogical. Moving to a multi-modal model, in which long distances are served by rail and water and shorter journeys by road, will help the country decarbonise and improve the efficiency and resilience of the freight and logistics sector. It will also improve the lives of HGV drivers who would spend fewer nights away from home.

The Government, alongside the sector, must work together to set targets and deadlines to switch more freight from road to rail and water. This must happen alongside steps to decarbonise road freight itself.

The introduction of the EU’s new Entry/Exit system later in 2022 threatens to cause further confusion, disruption, and delay at the UK’s border, particularly at the Port of Dover. The Minister stressed that other Departments were primarily responsible for the management of the UK’s borders. We recognise the division of departmental responsibility, but managing disruption will be the responsibility of the Department for Transport. It is crucial the Government gets a grip of this issue and engages urgently not just with the European Commission but with its counterparts in France and Ireland whose trade could also be disrupted if a solution cannot be found. (Paragraph 82) Road freight supply chain 35