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Seanad Éireann debate -
Wednesday, 15 May 1985

Vol. 108 No. 5

Road Transport Bill, 1985: Second Stage.

Question proposed: "That the Bill be now read a Second Time."

The Bill is the last in a series of measures aimed at terminating the quantitative licensing restrictions on road freight haulage for reward which were imposed by the Road Transport Act, 1933.

The first major step towards freeing the industry from those rigid restrictions was taken in 1971 when the weight limitations on vehicles operated under merchandise licences were abolished and licence holders were permitted to use the size of vehicle best suited to their business. Restrictions on areas of operation and on commodities which could be carried were also removed from licences issued to hauliers who were in business before licensing was introduced thus increasing from 100 to 841 the number of licences authorising carriage of general merchandise throughout the State. The Act of that year also freed from licensing control the carriage of cattle, sheep and pigs and provided for the grant of restricted road freight licences to foreign operators engaged in the transport of goods to or from the State.

The Road Transport Act, 1978 brought the process of liberalisation a step further. Prior to its enactment more than 500 licences were restricted to one vehicle each while some 150 licences authorised the use of only two vehicles. The 1978 Act increased six-fold the number of vehicles which a haulier might operate on each licence subject to an overall maximum of 80 vehicles for any one business. In order to encourage the development of the Irish international road haulage industry and to lessen the country's dependence on foreign hauliers, the Act provided for the grant of restricted road freight licences to Irish hauliers to enable them to engage in international haulage. To qualify for such a licence a haulier had to satisfy the EC requirements of good repute, sound financial standing and professional competence in accordance with the European Communities (Merchandise Road Transport) Regulations, 1977. Furthermore, the 1978 Act exempted from licensing control haulage in vehicles not exceeding 2.5 tonnes unladen weight and haulage of grain in the harvesting season.

Those measures were intended to give the existing licensed hauliers, who had hitherto been impeded by the restrictive nature of the legislation, an opportunity to expand their business and to prepare themselves before the industry was opened to new entrants. It was, of course, made clear during the passage of the Bill through the Houses of the Oireachtas that the ultimate objective was the complete removal of quantitative restrictions on haulage for reward. The phasing of the final step, which is the substitution of qualitative for quantitative controls with the effect of admitting new entrants to the market subject to a specific system of quality control, was considered in depth by the Transport Consultative Commission established by the then Minister for Transport in 1978. In their report of July 1981, which was laid before this House, the commission outlined the following course:

— A first phase restructuring of the existing licensing arrangements in a way which would permit existing hauliers entitled to operate under the Road Transport Acts to compete on equal terms as regards the area of operation and type of goods to be carried — this restructuring to take place during a two-year transition period commencing on acceptance by the Government of the Commission's recommendation.

—In the second phase, at the end of the transition period, general haulage licences to be made freely available to all applicants including own-account operators who satisfy the EEC requirements for access to the profession of road haulage operator.

The frequent changes of Government following publication of the report have had the effect of deferring adoption of these measures and prolonging the existing restrictive regime, which is really of benefit to no one, least of all, in my view, to the licensed haulier.

The decision of the Government was that the liberalisation measures should be implemented but with the modification, in response to representations from the Irish Road Haulage Association, representing the existing licensed hauliers, that the total abolition of quantitative control would begin two years after the beginning of phase 1 and not two years after the date of the Government decision, as recommended by the Transport Consultative Commission.

The developments within the industry such as employment growth as a result of the gradual easing of restrictions are a fair indication that the industry has had, and used, in its more businesslike sector, the opportunity presented to prepare for complete liberalisation. I believe that the further liberalisation measures we are now proposing will enable hauliers to develop their services in line with users' requirements. At the same time, the operation of quality controls will serve to raise the standards of safety and efficiency throughout the industry.

I have a varied responsibility in relation to road freight transport. I must do all I can to see that users of the service have the best professional transport industry that can be provided. I must also strive to ensure that, overall, national transport operates as efficiently as possible. In my view one essential requirement for this is an increase in the amount of traffic carried by the professional hauliers and a fall in the own-account element. I am satisfied that liberalisation to date has improved the share of traffic handled by the professionals. The statistics in this area are not complete but we do know from a survey carried out by the Central Statistics Office that, in the year 1964, the licensed haulage industry including CIE accounted for only about 17 per cent of ton miles compared with 83 per cent for own-account business. The next full survey was for 1980 and it showed that the licensed haulage share had more than doubled to about 35 per cent. There was a further slight increase to 36 per cent for 1982 which is the last year for which survey results are available.

Nonetheless, I believe that licensed professional hauliers have yet to reap the full potential of the market so as to reach the stage reached in several other EC countries where professional hauliers have typically a share of the order of 60 per cent of the traffic. The thinking of the Transport Consultative Commission was in line with this view. The commission observed that own-account transport was becoming more complex and costly to operate and that the willingness of own-account operators to reduce the level of their own commitment to transport offered an opportunity for the enterprising professional haulier. Frankly, I do not think that the hauliers can ever secure their full share of traffic until we have divorced ourselves totally from the intensely strict regulatory provisions which came into force over 50 years ago.

My multiple responsibility includes also a responsibility to those hauliers who over all the years have served faithfully and in some cases with outstanding efficiency under a system which was so restrictive as to be almost punitive in effect. The livelihood of these carriers is something we have to take into account. I do not accept the argument that liberalisation will destroy that livelihood. The hauliers of long standing have an edge in the market. They are the people who have been in the business for years. They are on the ground floor. They have the contacts and they have the expertise. They have a head start on all potential new entrants and they must win out.

The livelihood of long established hauliers will not be protected by unthinking opposition to change on the part of either Government or the industry. Entrenched opposition to change in the past has resulted not alone in an unduly high share of the market for own-account hauliers but also in the growth of illegal operators. Their very existence is a symptom of the failure of the legislative system to keep up with market needs. Sad to say that it is licensed hauliers themselves who have offered most resistance to the adaptation of the legislation to the conditions of today.

The restrictive licensing arrangements imposed by the Road Transport Act, 1933 were designed to protect the railways. They did not succeed in this and the road vehicle has long since replaced the railway as the favoured mode of conveyance for most goods. The trend towards greater use of road vehicles for such transport is not an exclusively Irish development; the same can be said of most European countries. We have to face the fact that the principle of quantitative control on licensed road haulage dates from the incredibly different world of over half a century ago. It has ceased for years to be relevant to our needs.

This Bill gives effect to the Government decision to implement the recommendations of the Transport Consultative Commission. Section 3 provides for placing all existing holders of merchandise licences on an equal competitive footing with each other by standardising licences. It also contains the provision which after about two years will open access to haulage for reward to all qualified candidates. The purpose of the phased approach even in this final stage of the liberalisation programme is to give all existing lawful operators a further period to strengthen their operations. Furthermore there would be an element of inequity in putting hauliers who, up to now may have been running illegally, on the exact same footing, from the start of the new regime, as operators who have respected the law over the years.

There are three categories of licensee each of which will be entitled to get the new standardised licences, called road freight carrier's licences, immediately the licensing provision becomes operative, namely: (1) holders of merchandise licences covering haulage of general merchandise throughout the State, (2) holders of merchandise licences restricted by area or type of operation e.g. Achill Island, car conveyors, and (3) holders of licences restricted to international operations.

Hauliers operating in the exempted areas, that is areas within a specified radius of the principal post office in Dublin, Cork, Waterford, Limerick and Galway, who, when the Act becomes operative hold, as required by the law, a current road freight certificate, being evidence that they have satisfied the EC requirements of good repute, sound financial standing and professional competence, will also be eligible for the new general standardised licences in the first phase.

The standardised licences will be classified as national or international licences. Both classes of licence will authorise holders to engage in carriage for reward within the State without restriction as to the type of merchandise carried or number of vehicles used. The international licence will be valid for international and home operations subject of course to compliance with the laws of any other State concerned. International licences will be granted only to applicants who satisfy the more stringent EC criteria for international operations.

Two years after the new licensing system commences any person or firm whose principal place of business is in the State will be able to get the standardised road freight carrier's licence subject only to meeting the qualifications laid down in the EC directive on admission to the occupation of road haulage operator. One of the consequences of this will be that suitably qualified own-account operators will be eligible for a licence to carry for reward. There is some apprehension on the part of the existing licensed haulage industry that this development would result in unfair competition. I do not think the licensed hauliers need have any fears in this respect; the present licensing system does not preclude own-account operators from holding licences to carry for reward but they have not availed of that facility to any great extent. In Britain, where own-account people have had for quite a long time now the facility to be licensed for reward, the swing from own-account to professional haulage has been very limited. The indications in Ireland as I have said and, indeed, as I read every day, are for a swing away from own-account operations. In any case to exclude own-account operators from carriage for reward would run counter to the whole idea of full liberalisation of the haulage industry which is designed to achieve a more competitive, economic and flexible transport system. The existing high level of empty running of vehicles increases costs; backloading for reward would help reduce costs and improve competitiveness. Many own-account operators would find it impractical to carry for reward of course. Nevertheless there is a lot of unladen mileage, for want of forward or back loads, in the own-account sector and the facility to put that mileage to use ought to be available to all involved as is proposed in this Bill.

In addition to restructuring the licensing system the Bill contains a provision in section 9 whereby own-account operators would be able to use hired vehicles for carrying their own goods; this would enable them to avail, inter alia, of financial leasing arrangements from which they are excluded by current legislation. This facility to use hired vehicles will apply only where the vehicle is hired without a driver; where vehicles with a driver are to be engaged carriage for reward would be involved and the licensing requirements would apply.

Leasing arrangements give the operator flexibility in settling the level of his own commitment to transport and relieve him of the need to have capital invested in spare vehicles to meet any short term upturns in business or emergencies. Long term leasing under contract has the further attraction that the leasing company relieves the operator of many of the operational problems associated with running a fleet of vehicles. I would hope that this new facility would enable many firms in the industrial and commercial sectors who must for one reason or another have their own fleets, to release capital for productive investment rather than have it locked up in vehicles.

Under the new arrangements, where after about two years any applicant complying with the EC requirements will be entitled to get a general haulage licence, there will not be a need for transfer of existing licences and the existing transfer provisions are therefore being repealed. Special arrangements are, however, being made under section 12 to enable family businesses to be carried on where the holder of a licence dies or becomes incapacitated. In such cases a new licence may be granted to a relative of the licence holder or the husband or wife of such a relative, who has had three years experience in the conduct of the business and who meets the EC good repute requirement. Where even these requirements cannot be met by a relative and in other cases where a licensee, or the manager of a licensed business who is designated as the person who meets the professional competence requirement, dies or becomes incapacitated I may, if necessary to avoid hardship, grant permission to enable a business to be carried on for a maximum period of 18 months. This will allow for disposal of a business or give a relative or manager time to obtain a certificate of competence.

The Transport Consultative Commission recommended that penalties for offences relating to road haulage should be increased and that the question of introducing on the spot fines should be examined. The licensed haulage industry has also been critical of the penalties under the Road Transport Acts many of which have not been changed since they were introduced in 1933 and can no longer be regarded as penalties. Provision is made in section 14 to increase penalties to a more realistic level and in the case of the most serious offences a maximum of £5,000 is proposed compared with £500 at present. I hope that these increases combined with the recently increased penalties introduced by the Minister for the Environment for road traffic offences will be a deterrent to serious breaches of the legislation and contribute to a safe and more efficient haulage industry. I am taking power under section 13 to introduce on the spot fines for certain offences to be prescribed by regulation. I have not yet decided what these offences might be. They would not, of course, be the major ones but rather those of minor character which could be established on the spot.

Section 7 is for the purpose of continuing in operation provision for the licensing of foreign hauliers who conduct part of an international haulage operation in the State. The existing provision relates also to Irish hauliers engaged in similar haulage operations; such Irish hauliers will, under the new licensing provision subject to meeting the relevant qualifications, be eligible for the general haulage licence which will also entitle them to engage in point to point haulage in the State and therefore will not need the special restricted licence for international operation. Foreign operators will not be allowed engage in point to point haulage in the State.

The repeals being provided for in section 15 are mainly consequential on the other provisions of the Bill. They relate to such matters as abolition of the exempted areas which are now being subjected to licensing control, termination of the licence transfer arrangements because qualified applicants will be eligible for new general licences, termination of renewal arrangements because the new licence will expire after three years and will not be renewable and removal of the restriction on use of hire or leased vehicles by own-account operators.

To allay any fears that the proposals in the Bill will impose restrictions which do not apply I want to explain that no existing doors to lawful haulage operations are being closed. Thus, in the two years after the new licensing code is introduced, restricted road freight licences will continue to be issued to persons wishing to engage in international operations and, also, persons wishing to commence haulage operations in the exempted areas may still do so subject as now to compliance in both cases with the EC requirements. This will be achieved by deferring the repeal of the relevant existing provisions until after the end of that two year period.

As I have said earlier, this Bill is long overdue. It is the culmination of a process started almost 15 years ago. I believe it will be welcomed by people both inside and outside the road transport industry. I also believe that efficient and enterprising operators have nothing to fear and indeed much to gain from the removal of unrealistic and harmful restrictions and that a more competitive haulage industry will develop as a result of the proposed measures, to the benefit of the national economy. I commend the Bill to the House.

In welcoming the Minister to the House I am not sure that we can give an unqualified welcome to this legislation. Unfortunately, over the past number of years we have seen this country swamped in all types of legislation but we have not attempted to ensure that legislation brought through the Houses of the Oireachtas is monitored. We had the situation over the past number of years where family planning clinics were being operated totally illegally throughout this State. We have pirate radio stations broadcasting on every type of wave band. The legislation to control these has not yet been implemented and even when it is implemented I wonder will there still be pirate stations around or will there be a proper monitoring system.

We have had a certain amount of chaos in the road transport industry for many years. I do not think, unless we see a better attempt at enforcement adopted when this Bill becomes law, that it will be of any benefit in eliminating the chaos that exists in certain parts of the industry at present. Legislation has been in force for many years which attempts to bring order into road transport, whether it be private road transport, private cars or the haulage area. If one goes back to the areas in which legislation exists, it is more in the absence of enforcement that it has been successful than in the enforcement. We see speed limits which are supposed to be enforced. We see breathalyser limits which are supposed to be enforced. Every vehicle is supposed to have proper identification, proper lights and indicators. If one drives down the country at night at present I guarantee that every second vehicle one meets, either coming against one or passing one out, will either have a badly adjusted light or a light missing. If you check the private cars on the road at present, possibly 90 per cent of them would not pass a road test because of the lack of maintenance and, indeed, of supervision of transport generally.

The major legislation that was introduced in the past few years in relation to the haulage system was that which provided for tachographs. There is no doubt that the tachograph legislation is not being properly operated. The main reason why it is not being properly operated is because we do not have sufficient people to check out the tachographs in the vehicles that are on the roads. In many cases the people who are checking tachographs are gardaí who have had no instructions on how to check a tachograph. In dealing with this legislation, which is supposed to be an attempt to liberalise and make the transport industry more efficient, we are bringing a Bill into an area where up to now the enforcement procedures already there are not being utilised. We are bringing in this Bill five years after the Transport Consultative Commission report came out. When that report came out it was suggested that there would be a growth in the need for road haulage and that there would be an annual market growth of 30 per cent by 1985. Anybody who looks at the road haulage needs in this country will see that not alone has that figure not increased by 30 per cent from 1981 to 1985 but there has been a total decrease in the demands that people are making on the road haulage system.

The needs of industry are being very well catered for at present by the number of licences and the number of vehicles that we have. We have a very efficient road haulage system which is the licensed part of that system. Since 1981 we have seen a major growth in the parcels and freight end of the business which has been taken away from CIE and which is being operated efficiently by a certain number of people who are licensed. There are a huge number of unlicensed people driving around the country in "bangers". We hear of people getting telephone calls at 12 midnight or at 1 o'clock or 2 o'clock in the morning to know if they would take a delivery from so-and-so's freight service. The reason these telephone calls come at those hours is because the people organising these services are probably illegal hauliers who should not be operating in the areas they are operating in and, to a degree, in a large number of cases they are using red diesel, which is illegal. They are probably using red diesel and therefore their rates are highly competitive. With the present level of fines if a person uses red diesel and is fined £50,000 a year for using it — £1,000 per week — he is probably saving money even if he is caught every week. The likelihood is that he will get through the year without being caught and save an enormous amount of money. Therefore, his illegal profits are enormous. The loss to the State is enormous because if he is hauling illegally we can be sure that he is not involved in the VAT or tax net.

The Minister states in his last paragraph that he believes that efficient and enterprising operators have nothing to fear and much to gain from the removal of unrealistic and harmful restrictions and that a more competitive haulage industry will develop as a result of the proposed measures to the benefit of the national economy.

It is laughable to think that there is much to gain from the removal of unrealistic and harmful restrictions and that a more competitive haulage industry will develop. The haulage industry in Ireland is the most competitive industry. The rates that even the illegal hauliers are charging are rates that were in vogue between 1977 and 1978. When one considers the increased cost of transport since 1977-78 it is unbelievable to think that anybody could suggest that they have much to gain and nothing to fear.

The number of road transport vehicles standing idle in garages around the country because the operators are not able to keep up hire purchase payments, the number in various yards around the country which cannot be put on the road because the operators cannot produce the insurance premiums — they have not got enough work to pay them — is considerable.

There are a number of good provisions in the Bill if enforcement policies are followed through. There is no doubt that anybody who gets into the haulage industry should be of sound financial standing. Sound financial standing today is one thing but the day after a person gets a licence he might well not be of sound financial standing. The industry believes that there is need for an assessment of the person's means in order that he will be able to stay in business. As in other industries, a better way might be to suggest that a bonding system be brought in, such as exists in the air transport industry, the insurance industry and in various other industries. The only way to protect the customers in terms of financial standing is through a bonding system.

Much thought will have to be given to own-account haulage. Own-account haulage, it is suggested by the Minister, has dropped over the past number of years and the slack taken up by the Irish road hauliers operating as a body. But this is not true. The percentage of people using their own-account haulage is still the same, at possibly, 70 per cent, with 15 per cent being carried by the licensed hauliers. I wonder if the Minister could come up with figures that are up to date because I do not think I could accept the figures that we have here. I have not seen any statistics which would give me the impression that licensed hauliers have increased their percentage of carriage over and above what it was in or about 1980.

The question of hauliers from outside operating inside this country is one to which the Minister should address himself very carefully. The increased penalties for contravention of various parts of this Bill are very welcome. They will be welcomed by anybody who uses the roads. Everybody wants to see that the vehicles which are on the road are safe and roadworthy. Up to now, it did not really pay to keep vehicles in a roadworthy condition because the penalties were too small. I am glad to see that there is an increase in penalties in this Bill.

Could the Minister, before this Bill goes through both Houses, address himself to the problems that the Garda and people who are enforcing the legal restrictions on road vehicles are faced with daily, of not being able to take a vehicle off the road and impound it? There is no other country in Europe — I am not too sure about the rest of the world — in which a vehicle cannot be impounded for a traffic offence. When I say a traffic offence, I am talking about overloading, bald tyres, bad lights and so on. If an Irish vehicle goes over to the United Kingdom and is found to be overloaded it is pulled in immediately. The vehicle is impounded until such time as either the load is brought down to the necessary weight if that is the problem, or if it is a question of bald tyres it is held until the tyres are changed. If it is a question of the tachograph, the vehicle is held in Liverpool or at the docks and the driver is not allowed out of the dockland area unless he gets his tachograph properly calibrated, sealed or fixed. I cannot see why companies can come in here from outside the State and compete at totally unrealistic rates in comparison with rates in the Irish road haulage industry and get away with it.

The licensing of road vehicles is to remain within the ambit of the Department. It would be better if an independent licensing authority was set up to which all applicants for licences would have to apply. It could be done in the very same way as when the Department of the Environment ask people to place advertisements in the papers to state that they are making a planning application for a house or for a change of use, etc. At least the general public and the haulier in an area, who might feel that his livelihood might be taken away, would be able to put to this licensing body the pros and cons of increasing the licence numbers in a particular area or of giving a licence to a person where there are enough vehicles to do the type of haulage that is needed in that area. I should like the Minister to look at this before the Bill passes through the Houses of the Oireachtas.

The Minister mentioned that in future people would be able to lease vehicles for the purpose of own-account haulage. Again, that is reasonable enough but he did not mention the short term lease. This is where an own-account person could go out and lease a vehicle for a week. That is something we could not agree with.

The Minister mentioned that he intends that on-the-spot fines would be brought in only for minor offences. I was talking in terms of foreign vehicles getting away with murder within the State. If we had a system of on-the-spot fines for foreign vehicles we would be doing much better than what is proposed here, where we are talking about on-the-spot fines for possibly minor contraventions of the Act. If we had a system where the fine was substantial for foreign vehicle owners, or operators within the country, then we could hold the vehicles until the fine was paid and that would make them deal with whatever problems they had.

The road haulage industry is a peculiar industry in a way. It is the only industry that I have ever heard of coming up with a suggestion that they would put up the money for the control of themselves, when they suggested to the Minister that they would put up £10 per vehicle per year for the introduction of a specialised road traffic corps. It was suggested by the Minister that it would take about £350,000 to set up this specialised road traffic corps and that after that, it would probably cost about £180,000 a year to run. If we take it that there will be a payment of £10 per vehicle, in the first year enough money will be taken in from the industry to support the traffic corps for quite a number of years.

We must pay tribute to the road traffic corps that we have in the country at present. They do a magnificent job under very difficult circumstances in the sense that they are working in support of the general public to ensure that vehicles on the road are in a reasonable condition and that the people driving the vehicles are in a reasonable condition. The road traffic corps are not trained in the special arts necessary to control road traffic. We expect our road hauliers to do a very specialised course in the regional colleges so that they can get a licence to operate a road haulage business but we do not send gardaí away to do a specialised course in the operation of whatever legislation we have at present.

I am not clear on the matter of giving a licence to an own-account applicant. I presume the Minister will bring in the same type of rules and regulations for the own-account holder as there are for the independent road haulage industry. If in a limited company there is somebody who has the competence to run a road haulage business and he leaves that company, does the own-account company lose its licence and, if not, how does the Minister suggest that an own-account company can run a business if there is nobody in that company who has a licence of competency to run the business?

The road haulage industry performs under very difficult circumstances. It performs on roads which are not suitable for the type and size of vehicles being used. Our road system is a fragmented one. There are very few cases in which a vehicle can travel for any great distance on reasonably good roads. Much of our haulage comes from the part of the country which has the worst roads. Trying to get materials to the main ports is a major cost factor for the Irish industry but it is equally a factor which has to be taken into account when we talk about the road haulage business.

The people who are operating transport here operate at a disadvantage compared with every other country in Europe when one considers the cost of insurance. The licence fees might be a little lower in other countries but our insurance costs are higher than in any other country in Europe. Our maintenance costs, which have been increased recently by 5 per cent, are very high. The cost of spare parts is enormously high in comparison with other countries. As somebody who knows something about the spare parts business I know it has nothing to do with the fact that there is an inordinately high profit being made on spare parts; it is purely and simply because import duties and VAT are so high that these items are extremely dear.

The revenue for the State from the road haulage industry is enormous. It has been suggested that it is one of the biggest industries that we have in the country in terms of the "take" to the State. The "take" to the State is an ongoing thing, day after day after day. The State "take" on road diesel must be enormous. I have not got the figures but we will have them before Committee Stage. It has to be emphasised that we have to protect the people who are running a very efficient business at present for this country, not alone for themselves. They are running into cash-flow problems. Those who bother to do the job properly are running into problems every day.

I am not suggesting that there is not the odd licensed road haulier who does not contravene the rules and regulations on occasion. That industry is the same as every other industry and you will have people who will go outside the rules. Generally they do a fantastic job in getting exportable goods to the ports and in transporting our goods outside the State.

The Bill is not going to do what the Minister suggests — develop a more efficient haulage industry. It is suggested that enterprising operators have nothing to fear but I fear for them unless they are given an area of operation which allows them to have their business controlled in a logical manner. This Bill would be more appropriate in boom times than for the present time. The Bill is as a result of a Transport Consultative Commission report. If we are to have a proper Road Transport Bill and proper legislation we should go back to the TCC and up-rate the figures and the suggestions that were made in that report. We should have another TCC report before we implement this Bill.

I would like to begin by welcoming this Bill. There are aspects of it on which I would like to seek clarification but in general, the Road Transport Bill, 1985 deals with a programme of liberalisation in relation to road haulage and road transport that has been going on since the passing of the 1971 and 1978 Acts. I would like to refer to what Senator Lanigan said about the difficulties with our road system. We are all prepared to share his view that finance for the road system throughout the State at the moment — there are many very good exceptions to that — is in need of upgrading. I would like to mention to Senator Lanigan in case he has not thoroughly read the Building on Reality document published by this Government——

We are not back to that fairy tale.

——that we have increased by 50 per cent the finance for the roads programme over the next number of years. If one is a member of a local authority, and I know that the Senator who has just spoken is, one would be aware of the way in which the local authorities have stepped up their programme of acquisition and of financing. The matter concerns road transport. Yesterday, I spent some time at an oral hearing relating to a six-lane motorway outside St. Patrick's Cathedral in the centre of Dublin. That is just to give one illustration of the positive mood that is coming into the area of road development——

The six-lane road is going to——

An Leas-Chathaoirleach

Would Senator FitzGerald get back to the Bill? What he has just said is not relevant.

I would like to say to you, a Leas-Chathaoirligh, that your good colleague, Senator Lanigan, spent a great deal of time speaking about the country's inadequate road system and that is a matter which directly affects the road haulage industry. Therefore I would suggest that I am perfectly in order.

I would like to make it clear to Senator Lanigan that these proposals, both in regard to acquisition and to financing the roads system are very heavily enshrined in Building on Reality and will be seen over the next three years, if the Senator read the programme on road development, to match the document that has been published in relation to the specific roads that have been mentioned for improvement, upgrading and for major investment in that three year term. I would say also to Senator Lanigan that by the time we face the people at the end of this period in office there will be a very different road system in many parts of the country.

To get back to the Bill and the direct question that affects those in the haulage industry, the Bill does a number of things to improve the existing situation. It is a very comprehensive Bill and it is following the recommendations, as Senator Lanigan said, of the consultative commission on road freight haulage, the Transport Consultative Commission. It deals with the question of issuing licences to all applicants who satisfy the EC requirements of good repute, sound financial standing and professional competence. In many respects it will bring licensing in the road haulage industry into a much more equitable state. The cost of purchasing road haulage licences at the moment causes some concern throughout the community. The controls, on the other hand, that would be necessary in the establishment of whatever licensing authority the Minister intends to have in relation to the issue of licences is an important matter. Whereas one would like to see the freeing-up of licences to have them more widely available — the cost of a licence at the moment is pretty prohibitive for many people who would like to enter this industry — there is equally a need to seek a standard of qualification from those who are applying.

The whole question of applications for road haulage licences should be subject to much the same kind of qualifications that may exist in the insurance industry but certainly exist in the auctioneers industry, where an applicant has to insert an advertisement in the public press stating the intention of applying for a licence. There should be some attempt to make public the matter we are dealing with so that objections to the qualifications of an applicant could be provided by those in the industry and elsewhere, by those who feel that the applicant is an unsuitable person to drive a heavy vehicle, such as those extraordinarily long vehicles that we see on our roads at present.

The Bill generally in the case of own-account hauliers, those who operate a vehicle belonging to a company, will make such vehicles much more costeffective than they are at present. My understanding of the situation is that if an own-account vehicle ends up in another part of the country it cannot collect goods there and take them back to base. There is a difficulty in that respect. The costeffectiveness of our road haulage system at the moment is harmed by the fact that there are unladen vehicles travelling the road system. That problem could be resolved in the relevant section of the Bill and would bring these own-account hauliers into the position in which everybody else will be in about two years time.

I would like the Minister, in his general role as Minister for Communications, to comment on the effects on Córas Iompair Éireann of the passing of this Bill. I understand that Córas Iompair Éireann operate a cage system. There are other institutions which operate cages also. Members of these Houses were down in Spike Island a few days ago and I suppose there are cages of one kind or another there, but there are cages operated in the freight system of CIE which apparently cause problems for those who want to use that service in that if the merchandise is too big for the cage and does not fit properly there are difficulties in taking the merchandise on the rail system.

I am one of those who would have preferred, if I had the opportunity of contributing in this House 15 years ago, to have seen much greater development of the Córas Iompair Éireann freight system but, unfortunately, the country, albeit it is something we cannot do much about now, has to a large degree gone from rail haulage to road haulage. I say that because of the effects on our road system, on tourists and on our community generally of freight vehicles operating on roads which are unsuitable for the size of these containers. It is not a matter we can deal with now. It has long passed that point. I make this point because when we look at the position of the Italian, or any other European, rail system, we see that they seem to have been able to maintain their system in a much more viable way than we have been. I do not know how viable they are but certainly the services are available. Freight is carried by them on rail as well as on road and it would seem to me to be proportionately higher than the freight carried here.

The area of safety was mentioned by Senator Lanigan. It is an area which should call for the greatest attention and pursuit by the Garda Síochána. Those involved in the road haulage industry recognise the need to step up the areas of enforcement. It relates in some cases to driving heavy vehicles without licences and to those who, in one form or another, flagrantly abuse the code that exists. I know the Minister referred to the fact that he intends to raise to a realistic level the fines for serious offences to a maximum of £5,000, compared with £500 at the moment. Equally, the Minister for the Environment, in regard to road traffic offences, recently introduced increased penalties which will act as a deterrent to serious breaches of legislation, contributing to a safer and more efficient haulage industry. Interestingly enough, the Minister for Communications is also considering taking power under section 13 to introduce on-the-spot fines for certain offences prescribed by regulation. I will be interested to see those regulations at a later stage.

My concern is about the vehicle that the ordinary road user meets in this country at present. Senator Lanigan mentioned vehicles that are badly lit. Sometimes they are so dirty that one would not know whether they had a light at the back of the vehicle or not. I met a vehicle outside Leinster House today and I would not like to tell Senators about the altercation I almost had with the driver. Those vehicles simply abuse the road system because of their size. This is a matter of importance for the Garda Síochána. I might qualify my remark by saying that I am quite certain that the vast majority of heavy road haulage drivers drive with great care and decency but there are some who cause real problems. I do not think the Garda Síochána travel after them to the extent they should.

I remember passing through Maynooth three or four years ago and escaping by seconds instant death by overtaking a vehicle seriously overloaded with a load of roofing tiles. I do not suppose it was the effect of the car in which I was a passenger but the material came crashing onto the road. Anybody who happened to be in the immediate vicinity at that time would have been a "goner". The Garda Síochána will have to become much more vigilant about controlling heavily laden vehicles that are totally unsuitable for our road system.

I am moving slightly away from the point when I speak of vehicles used for the building industry but there could be vehicles used in some form or another for road haulage. Vehicles used in the building industry are so heavily laden that they are a danger to the public. A great deal more attention should be given to them.

I would add that this matter also relates to very many farm vehicles which travel on our road system, for example, balers, tractors and so on, which often use our roads without proper licences or sufficient care. These are a cause of distress on our road system. I know this is the Second Stage of the Bill and I hope to speak again on Committee Stage. The Bill is a reforming measure which must be welcomed in this House. Hopefully the Bill will receive due consideration. Perhaps we may have a fresh look at sections which may require attention on another Stage. The Bill will be very welcome and a very useful measure to have on the Statute Book.

I might not be in total agreement with some of the ideas put forward by Senator FitzGerald on the Bill but it is necessary that we modify our road transport legislation from time to time. Much of the chaos which has come to the transport industry in this country has come via CIE. For too long CIE were in a position to have an overall grip on all types of the road transport business in this country. We all know the problems that private owners and those who wished to get into the haulage business had in the fifties and sixties when it was common to see people prosecuted for road haulage offences. The net result was that our road haulage industry never developed and still has not done so.

A situation has arisen where the road haulage industry in Northern Ireland has developed using Southern Ireland as a base for extra finance and work to develop their own businesses. At the moment much of the heavy freight from this country is carried by carriers from Northern Ireland or Great Britain. We see this every day. If one looks at the number of juggernauts travelling on any ferry from this country one will see that the number of them registered in the State is much smaller than the number of those registered outside it. The net result is that we are now trying to make up the ground that was lost in those years to private transport and to a licensed haulage industry which now finds itself without the necessary revenue to allow it compete against outside influences.

If we are going to develop our road haulage industry, the first thing we must do is to strengthen those who are already in it. I was one who would have agreed with the increase in the number of licences per plate which was changed in 1978 when it was increased from one to six. Many of those extra licences have not been taken up. At least 25 per cent to 30 per cent of extra licences made available under that Act are not being used at present. The number of owners who at that time had "one plate" as it was called and who would have increased to six would be very small.

The licences under this law, for which many people had to pay a very high price in order to get into business, are now of the same value as the daily newspaper, or will be very shortly. It is sad for those people that they are not to be compensated in some way or another, perhaps by allowing a longer period before the proposed changes come into effect. The Minister should have a look at this and see what he can do to help those carriers who invested in the belief that the licences which they were buying would have a reasonable market value for quite a number of years from the time they bought them.

The problem of outside carriers coming in here is that extra power will have to be given to the Garda to deal with them. I would like to know how many vehicles leaving this country in the past year or so have been taken in and weighed. I would also like to know the number of Southern vehicles impounded in Northern Ireland because they have some minor defects.

I know of one case where a Southern carrier was taken in and held in the North until he took off 50 kilos of excess weight. He did this by letting diesel out of the tank of the lorry to bring him down within the weight. Yet we here are not enforcing the regulations with regard to weight, tachograph hours or anything else to the extent that they are being enforced in other EC countries. The net result is that outside interests see Ireland as the bonanza place to go to do business because they can take chances in the Republic which they cannot take outside of it.

When these new regulations are being implemented and enforced they should be enforced to the last letter of the law to protect the people who are already in the haulage industry and to protect the jobs that are in it. They are competing against outside interests who have very great advantages over them. They have the advantage of cheaper vehicles. The import duties an Irish company will pay on a new heavy vehicle, in comparison to that paid by their counterparts in Northern Ireland, Britain or Germany, leaves them at a total disadvantage from the word "go". Maybe it is time to look at the rate of import duties and VAT on heavy vehicles. We know that the VAT is refundable to the purchasers of these vehicles, but it is still a burden which they must carry for a certain length of time. It is only a paper exercise having it transferred. They pay it and then claim it back.

I hope the Minister will ensure that there are more mobile patrols provided within the State to check on the heavy haulage business. It is mentioned here with regard to the proposed changes for own-account haulage. The very reason that many firms have not used public haulage companies is that they found they were not in a position, due to the restrictions that were placed on them for quite a length of time, to give the service. They also found that the reliability of some of the cowboys in the business was so bad that they just had to provide their own fleet, which meant they had to tie up extra capital in many cases. This was depriving their main business from developing. If we had a proper, well-run road haulage business we could, I believe, free capital from private individuals and companies which would then be available for them to reinvest in their direct businesses rather than having to invest it in what could be classed as a side business, namely, the provision of their own transport.

The Minister should, before he puts this Bill through the House, examine the comments made by the Irish Road Haulage Association. They made quite a number of comments in the past few years. That organisation is not there to operate the closed shop, in my opinion, but to safeguard those people who are already in the haulage industry and to safeguard the jobs in the haulage industry. After all, what we want to see develop from this and any other such legislation is a more efficient system which will provide not alone a better service but also employment for people. It should mean rather than having a large percentage of our freight carried to and from this country by outside hauliers that we would have the opposite situation developing, where we would have 80 per cent at least of freight haulage within this country done by Irish hauliers employing Irish people, giving them jobs, rather than having Irish money leave this country in freight charges. Such money could be better used at home to provide jobs for our people.

The Minister should take a very hard look at this Bill in relation to existing legislation in order to ensure that the changes are implemented with the full rigour of the law and anybody found operating outside those regulations should pay the penalty. I would ask him to ask his Department to make sure that the cowboy element which has crept in to road haulage in this country in the past few years is removed as soon as possible. The sooner those mavericks who operate on red diesel or use other illegal methods are put out of business the sooner the Minister will be in a position to develop our own haulage industry. As I said earlier, the development of this will mean more jobs for Irish people.

I would like to welcome this Bill. Senator Lanigan made a few points with which I do not agree. He spoke about the leasing of vehicles and the short term leasing that would create a problem, particularly if people could lease a vehicle for a week. If people wanted to lease a vehicle for a day they should be allowed to do so because in every country — it happens with cars and trucks on a smaller scale in this country — they have car or truck replacement vehicles for people whose vehicles have broken down. The vehicle might be on the way from Kerry to Dublin, or vice versa, and the haulier may not have a spare vehicle and would need to lease a vehicle. Private people might also have breakdowns and they would need to lease a vehicle. Vehicle leasing on the whole is something that is very important to the people. Because of the high costs of vehicles today all the bigger companies in the State, such as the oil companies, the distillers, Guinness's and others, have gone in for leasing. They have actuaries, accountants and experts and I am sure they would not be doing that if it was not a worthwhile proposition.

Senator Lanigan spoke about the faulty vehicles one sees going down the country, particularly those with faulty lighting and bald tyres. I think that was true of commercial vehicles up to about a year or two ago, but since the MOT testing came in all these vehicles have to be tested by an approved station. They have to be certified by the local authority. They are tested once a year. I am sure that any reputable company — and they would not be testing if they were not reputable — will ensure that vehicles are all right. Senator Lanigan referred to cars, which are not mentioned in the Bill, but he was right about that point. All he was doing was making a very good case for MOT testing for cars, something we will have to have in the very near future.

Senator Lanigan also made a point about unfair competition from vehicles outside the State. Any vehicle outside the State coming in here has the same freedom. That is one of the benefits of the EC. They have the freedom to deliver their goods into this country just the same as we have the freedom to deliver in any other EC country, but do not have — nor would we have — the right to use those vehicles in the State for local deliveries. He also spoke about the cost of spare parts, excise duty and VAT. He said he was in part of that business, just as I am. He was not correct when he spoke about, first of all, increases in VAT on the cost of repairs which was increased from 5 to 10 per cent. The Minister made that increase at the time he was trying to rationalise VAT charges. He reduced the excise duty from 25 per cent to 10 per cent. Everyone in the vehicle business knows that the cost of parts far exceeds the cost of labour.

As regards people with commercial vehicles, I do not think the VAT comes into it at all. All these people are registered for VAT and VAT is reclaimable. In actual fact they are not paying VAT. It is a question of a paper exercise — you pay it and you get it back. Then there are also VAT credits. If you are in business you are collecting VAT money that you do not pay in for two months. So one balances out the other the whole time.

The Minister also spoke about the high cost of fuel. I understand from my experience of last year — not this year, but last year — in the North and in the UK that diesel fuel costs around the same price as it does here. I know petrol prices are different but there is no difference in diesel fuel. The fact is that VAT is recoverable on diesel fuel to the commercial users. They are paying 23 per cent VAT, but they are getting back the 23 per cent VAT, so they have no complaint in that respect.

In regard to the people who have own-account vehicles, there was the recent case of Irish Distillers who are disposing of their own vehicles and are going over to hauliers. They find that hauliers are more satisfactory and there is no capital tied up in the purchase of vehicles. They know that there is no disposal problem at the end of the year with vehicles. On 1 January they know exactly what their costs will be right up to 31 December. In that way they are proving the point that the Minister has made that the hauliers can only benefit from this.

The matter of compensation for people who had plates was raised, and it was said there is no provision for compensation. I do not think that there is any case for compensation in this case. When these plates were first issued under the Road Traffic Act, 1933 — and I remember it quite well — anybody who applied for a plate at that time got a plate for the sum of £1. A number of people who were wise at the time applied for more plates than they required, They were able to put on extra vehicles after a few years. Then the plates became collectors' items and were sold for very high prices. There were people who came in in later years, when there was a high increase, who bought these plates and paid a high price for them. That is true. But they had got value for that in the meantime in so far as the capital laid out was reduced by a ratio of 6-1 when the people who had bought those plates were entitled to get six plates for every plate they held.

By the time this Bill comes into force — it is two years from the date of the regulations — they will have their money back. It can only lead to a better system of transport. It is going to mean a cheaper system because there will be organised back loading. The biggest problem in this country is the waste of transport. Trucks come from Kerry to Dublin to collect their loads while trucks go from Dublin to Kerry delivering loads. There are vehicles doing a run each day without a load. These are professional people and when the traffic is there to collect it, they will collect it.

Another matter mentioned by the Minister, with which I am entirely in agreement, is on-the-spot fines. The Minister is bringing this in for the commercial business. All I am sorry about is that it is not coming in for every vehicle. I was in Canada recently and if one comes out of a side road and there is a stop sign and one does not stop one is fined $30 and the fine is paid on the spot. The result is that everybody stops at the stop sign. In this country because there is not an on-the-spot fine system nobody stops at the stop sign unless some other vehicle stops. I would like to see that system in operation here. I fully support the Bill.

One of the main reasons I am speaking on this Bill is because of an incident that happened yesterday on my way to Dublin on the main Cavan-Dublin road. A huge lorry which appeared to me to be empty passed me out at about 70 to 80 miles an hour. A huge plank flew off that lorry and missed my car and an oncoming car. It did not land on a hedge but went straight through it. The impact would have been about 150 miles an hour had it hit my car. I made a decision that I would try to bring to somebody's attention the fact that there are people, even in the haulage business, who have no care for other users of the road. That lorry driver was carrying a load of death. I failed to catch that man from the Cavan boundary right into Navan and he escaped me in Navan. He took some other turn. I could not catch him. I estimated that he was doing well over 70 miles per hour. There is much to be said for what Senator FitzGerald said. A similar incident happened in his case. Two Members of the Seanad today related their experiences in a debate with regard to improper use by lorry drivers and negligence, so the problem is widespread.

With regard to the legislation, I would support any legislation that would eliminate what are termed as the "cowboy operators" in any industry. In this case we are speaking about the ones who have no respect for other road users, those whose vehicles are not properly taxed, insured or maintained, or who use fuel that is subsidised for the farming community. I suppose it is elimination by legalisation in effect. If we look at the Bill a good many of these will be brought into the licensing net and subjected to the restrictions, standards and guidelines that apply to properly licensed hauliers.

This problem was created to a large extent by the monopoly held by a major State body in this country over a number of years, namely CIE. At the same time, I would say to the Minister when we talk about liberalisation we should be careful not to let the business get out of hand. We have the experience in this country, and the building industry in one case, where we allow it to "over-heat", and when the "valley" period comes, which we are in at the moment in that business, there seems to be no answer to the problems. We could end up with a monopoly situation where many of the firms might — hopefully not — end up going out of business. We have enough businesses "biting the dust" in this country at present.

We have to protect those business people who are heavily in debt and who have given commitment and service to the industry over a long number of years. I feel rather sceptical when I get a letter from the Irish Road Haulage Association — a body of repute. They totally oppose the legislation.

Will the Bill in some way damage the business or do people who are experts in the business see that it has damaging qualities? I would like to ask if the Minister in his reply would give some indication whether we have proper facilities in this country to comply with the EC standards. We talk about EC standards. I would like to list one, weights for heavy vehicles. Have we weighing scales to weigh lorries properly? I do not believe we have. The weighing scales are not fit to take the very long heavy vehicles that are using our roads at present.

I feel sorry for the holders of plates, as they were known, because they will not receive any compensation. A good number of plate holders have been unable to get business for the last number of years. It was their mistake that they did not sell them when they were worth money some years ago. Prior to the Bill they felt that they had something of value, but they will become valueless in two or three years' time. I would ask the Minister to bring to the attention of the Minister for Justice the need for more mobile patrols and on-the-spot checks on these large vehicles on the roads. Having said that, I know that many of our licenced hauliers are very good drivers, and we all have the experience of their courtesy on the roads, where they will move over to let a heavy stream of traffic flow by. We have the odd instances and, unfortunately, these are the ones that bring trouble and death to our roads.

Firstly, I would like to thank Senators for their contributions, and it was very clear notwithstanding the circulation was only a few days ago that Senators were well prepared for the debate. I would like in the course of my reply to try to deal with some of the questions raised.

Senator Lanigan raised the question of increasing standards. The EC competence criteria have already been raised through the exam system; both financial and other criteria are under review with a view to raising the standards. Senator Lanigan also raised the question — it was raised again by other speakers — that the fall in licence values suggested that we should compensate people for not being able to sell their licences. It is something that I could not accept. It is a scandal that licences issued by the State were being retailed at very high prices. That indicated in itself that there was something wrong with the existing system.

In relation to the point made about statistics, it has often been acknowledged in this House that road freight transport statistics were weak. However, since 1980 that situation has dramatically reformed through the adoption of EC practice and an improvement is continuing. There is no ground in this context for casting doubt on the 1982 statistics as an indicator of trends over a long period. I regret that Senator Lanigan does not accept the Central Statistics Office statistics.

Points were made about external hauliers. External hauliers must be admitted, otherwise Irish hauliers cannot gain access to external territories. The more efficient industry this Bill seeks to promote will be a better instrument than any other for ensuring that our own people can compete with hauliers from outside.

Senator Lanigan suggested an independent licensing authority. There is no case for an independent licensing authority in the context of qualitative control. It helps to balance supply and demand, and is not on anywhere at all because of measurement difficulties. We have had a supply and demand provision in the Act since 1944 but it has been completely unworkable. Under a qualitative licensing system there is no distinction by which the Minister could make fish of one and flesh of another.

There is already a cross between the provisions on this. Licenced hauliers can engage in their own account or can carry forward their licences. No one in the future will be entitled to sell a licence and no one will be entitled to hold a licence without the appropriate qualifications.

In relation to competition, a point made by Senator Lanigan, the Bill is intended to eliminate cut-throat and cowboy competition which I acknowledge to be a problem. Free access subject to quality controls will gradually eliminate the fly by night and the cowboy who can do so much damage. These are the effects I see from this Bill. As I pointed out at the outset, there has been opposition to the updating of the law which has permitted the growth of illegal haulage, which is something I want to stop.

Senator Lanigan did make a very valid point about the non-implementation or non-enforcement of legislation. I am aware of the widespread concern about this, articulated by many Senators in this debate. I will be taking their views under notice and will consider them further during the consideration of this Bill in the Houses of the Oireachtas.

As regards many offences of a traffic character, I would have to remind Senators that the Road Traffic Acts are not within my province. This does not invalidate the considerations raised by Senators.

There have been some allegations that the legislation in relation to tachographs is not being enforced. This legislation is monitored carefully by my Department and also by the EC. I have been able to report to the EC that there is about 90 per cent compliance with the requirement to have a tachograph fitted and, within that bracket, a high proportion of compliance with the requirements as to use.

There was also a point raised about vehicle leasing. It would not be practical to provide for ever against short term leasing once long term had been allowed. The idea of phasing between long and short term has been considered but, on balance, it was thought better and more realistic to deal with the whole matter in one provision. The TCC saw no significant danger for licence holders in the abolition of the ban on leasing. The removal of control on smaller vehicles in 1978 and the fact that in the exempted areas control on haulage vehicles never existed renders the leasing question marginal anyway.

I hope I have dealt with all the points made by Senators. I thank them for taking this Bill today and for their contributions. I look forward to going into more detail with the Senators on Committee Stage.

Question put and agreed to.

The Finance Bill will be in the House next week. I suggest we order it for Wednesday, 29 May.

Committee Stage ordered for Wednesday, 29 May 1985.