I welcome Mr. Vincent Caulfield, president, and Mr. Jimmy Quinn, vice-president of the Irish Road Haulage Association to the meeting. The presentation and briefing materials have been circulated.
Irish Road Haulage Association: Presentation.
Mr. Vincent Caulfield
I thank the Chairman for the opportunity to address the committee. The presentation documents have been circulated highlighting our main issues of concern, in particular the fuel issue. We use large amounts of fuel which is our raw material and the significant increase in price over the years has a huge effect on our business. Fuel has been a crisis issue for us since the year 2000 and continues to be, following what happened last year.
Prior to the most recent budget we submitted a comprehensive document prepared by BDO Simpson Xavier. Our submission sought that the Government would acknowledge the role played in the economy by licensed tax compliant hauliers. Unfortunately, our business operates against a fair bit of activity by people who are not as compliant as we like to think we are. Government acknowledgement would give us a slight competitive advantage or head us in that direction. We presented the document to Department officials and it was well received. The Department promised it would get back to us with any questions. We met the Minister also and were led to believe that our submission would receive favourable consideration. On the day, however, that did not happen. We were disappointed the Minister for Transport did not support our initiative as we felt he should have. We met the Minister of State and he indicated he supported it and indicated the same to the Department of Finance officials. Our members felt strongly about the setback and we came under pressure as a result.
I am not quite sure what Mr. Caulfield is talking about.
Mr. Caulfield
I am talking about the budget submission prepared by BDO Simpson Xavier which we submitted prior to the most recent budget.
He is basically outlining the problems having a negative effect on the road hauliers.
Is Mr. Caulfield talking about tolls?
Mr. Caulfield
No. I am talking of fuel costs.
That is what I did not hear.
Mr. Caulfield
We also face other difficulties such as changes in the industry and the need to comply with laws and regulations. The digital tachograph is being introduced next month and all new registered vehicles must have it installed. The working time directive will also have an effect on hauliers and adds to the difficulties the industry faces.
The new penalty point regime will directly affect lorry drivers. Travelling in the outside lane of the motorway is one offence that will carry penalty points. People may take the view that it is a safety issue and we should not travel in that lane. We, however, feel that a safety issue may be involved if we cannot use the outside lane. If, for example, we are behind slow-moving vehicles we will be obliged to stay behind them. Tractors and trailers travel on our motorways, but whether legally or not I am not sure. If they cause an obstruction or delay, we could end up with a convoy of heavy trucks behind them on the motorway that once we get to a regular road would be in the position to try and pass them. We see that as a safety issue. We spoke to the Minister of State at the Department of Transport, Deputy Gallagher, about this yesterday. We suggest that the prohibition should only apply to a three-lane motorway which would allow us overtake on a two-lane one.
Another penalty point offence with which we have difficulty is the restriction on crossing a continuous white line. Many secondary roads around the country have continuous white lines where it is not possible to drive a heavy goods vehicle inside the white line. I understand a garda can impose penalty points for crossing the line. We have a difficulty with that and our members and drivers are worried about it. The restrictions will apply to drivers more than haulage operators as it is the drivers who will try carefully not to accumulate penalty points. They will stay behind a slow-moving vehicle, but I am not sure how they will proceed with regard to the continuous white line in the centre of the road.
Mr. Jimmy Quinn
We would like to discuss the Dublin Port tunnel HGV management strategy for the city of Dublin. We wait with bated breath for the tunnel to open. We are positive about how it will affect the people of Dublin and the people using the port. We need to set out a marker straight away. We believe there should be no vehicles in the city unless they have business there, for example the need to deliver to high street shops or to business located within the cordon. The advantage of the tunnel is that approximately 6,000 vehicles a day will enter a hole in the ground from the quays and come out at the M50.
There are flaws in the strategy and proposed document and their negative effects are not just a Dublin but a nationwide problem. This is a country that lives or falls on its export performance. It would be unfair if Dublin City Council was in a position to handicap people working and producing goods in a factory in Mayo, Donegal, Sligo or anywhere along the west coast. It is not long since "peripherality" was the word on everybody's lips. It is difficult enough to do business off an island and we do not need to be handicapped any more than we are by dint of geography.
We fully support the tunnel and the notion that there should be no heavy goods vehicles in the city. However, there are many businesses in the city that need a presence and this has been acknowledged by the Department. Fundamental to the strategy is the notion of a truck ban in the city from 7 a.m until 7 p.m. This is a risky strategy. It has not been employed anywhere else in Europe and it has the capacity to severely affect the ability of Dublin businesses to stay in business. It will also affect retailers who require deliveries almost every hour, particularly at rush periods such as Christmas and other peak times for retailing.
It has the capacity to turn Dublin into New York; it could become a city that never sleeps, with noise ongoing for 24 hours a day. This daytime ban is the exact opposite of what the Greater London Authority tried to achieve a few years ago when it imposed a night-time ban on vehicles. There are many windows of opportunity in the city in respect of deliveries. We are well used to delivery protocols on a pan-European basis. We deliver for the Celtic tiger every morning across every city from here as far as the old Russian border, so we are familiar with European norms. We are quite prepared to work with the delivery protocols; we are not demanding unfettered access to the city or anything of that sort, but this notion has been put forward. We are the people at the coalface. Some of the dictation we have received from a number of the parties involved has been nothing short of disgraceful. The height limit will handicap importers and exporters the length and breadth of the country because of a simple error made in Dublin. The Minister indicated that he will decide on the height limit soon.
The adoption of many British systems has served us well for many years. We drive right-hand drive cars on the left-hand side of the road, British pallets rather than the European model and double-decker buses along with single deckers. Many practices date back hundreds of years. It should be borne in mind that Britain is our largest trading partner by road. Any attempt to handicap our exporters will only lead to consumer goods becoming more expensive. The transport industry is a function of consumer society and not the other way around. For example, nobody makes beverage cans in Ireland any more and, therefore, the country's entire stock of such cans is transported here in high-cube trailers. If these trailers are scrapped, it will take three regular trailers to carry what two high-cube trailers can transport. This would mean that three additional drivers will need to be employed and three more trucks, with their attendant emissions, will be operating on our roads. This is an era when people are striving to be efficient and hauliers and shipping lines have gone to the nth degree of efficiency to deliver world-class solutions for consumers, manufacturers and importers. If we are told to scrap this equipment, it will be a sad day for this country in terms of progress and of transport dynamics. We are concerned from that point of view.
The committee may be aware that trouble occurred in the port earlier today.. A report was commissioned, at great expense to the taxpayer, by Dublin City Council. It identified that the East Link Bridge will be a severe inhibitor in the operation of the port when the tunnel comes into operation. The import-export vehicles that are sustaining the country will be confined to one square mile of Dublin Port. That is all we want to use because we have no major need to be anywhere else. However, the toll bridge is right in the middle of the port. When it was built, South Bank Quay, the major container handling area, did not exist in its current form. The effect of the location of this toll bridge is a toll on South Bank Quay because the vehicles will be confined to the port tunnel.
Our document goes further than that published by the DTO in terms of proposals for the elimination of heavy goods vehicles from city streets and it is much more restrictive. It outlines an option to move the toll bridge for trucks down to Sean Moore Road. Vehicles going in and out of the terminal would not be penalised. This is a minor engineering solution; it is not rocket science and will not cost a fortune. We want to see this work carried out because we have a huge vested interest in the port being run efficiently. We have no interest in annoying residents except in circumstances where doing so cannot be avoided.
The NRA proposals endorse our views that, in the short term, the absence of the three lanes on the M50 will mean traffic problems on East Wall Road and Sean Moore Road. There would be no point directing the entire output of the port onto the M50 if the latter will already be chock-a-block.
Our document proposes that the quays be sterilised in respect of north-south traffic. In other words, there should be no rat-runs available up the quays for any vehicles. This goes much further than the DTO's document. We are attempting to shine some light on this matter and encourage a calm and rational debate because it has been hijacked by people who say they do not want any trucks in the city. There is no city in the world that does not have trucks because the logistics of feeding, watering and entertaining a city. I refer here to delivering the litres of milk, the loaves of bread, the pints of porter and whatever you are having yourself. Such logistics must be taken into account in New York, London, Dublin and Copenhagen.
We are fully committed to managing this with minimum disruption and maximum efficiency. It is sad that such an ideal has been lost in the official documents. We cannot have a situation where Dublin city councillors are making things awkward for exporters throughout the country.
I wish to refer to one of the anomalies in this document. Under the official proposals, a four-axle vehicle — which might be quite old — travelling to Connemara would be allowed to leave the port and trundle up through the principal shopping and pedestrian areas, whereas the driver of a six-axle vehicle with a trailer-load of sandwiches for a shop in Grafton Street would be obliged to sit twiddling his or her thumbs until 7 p.m. when the curfew is lifted. This issue must be taken seriously, otherwise it has the potential to strangle the commercial life of the city. It is much easier for hauliers to service the brand new shopping centres out on the ring where there is plenty of room to turn 60-foot trailers. Serving and keeping the city centre alive is a very tricky business.
I thank Mr. Quinn. How do fuel costs here compare with those in Northern Ireland, Germany and France?
Mr. Quinn
Ireland is roughly half way down the European league. We made a submission to the deputy president of OPEC. He informed us that the solution is in the gift of the finance ministers of western countries. The Minister for Finance currently takes €367 every time we fill a truck. The EU stipulation is that he must take €302, which allows for a €65 margin without incurring the wrath of Europe. This was probably discussed over brandy and cigars one night at the meeting of ECOFIN ministers.
How does Mr. Quinn know what goes on there?
Mr. Quinn
They would not, as a bloc, issue concessions to hauliers and this is a fundamental flaw. The taxation regime was fine and dandy when fuel was $20 a barrel but that day is gone and it will never return. We are now in a regime where the price of fuel will float between $60 and $90 a barrel for the foreseeable future.
Ireland is the most dependent of any EU state on road transport. We export 90% of everything we make and, by definition, most of those goods are imported to Ireland from abroad for remanufacture and re-export.
We attended the conference in Dubai. The head of Dell gave an audio-visual display. He said that every time somebody clicks a mouse——
Was it a junket?
Mr. Quinn
Absolutely. We worked very hard.
Let us consider circumstances in which a child in Germany clicks a mouse on his computer to order a PC from Dell in Limerick. That triggers a reaction whereby bits and pieces flow into Ireland from 19 other countries. These are assembled here and are trucked back out again. The Chairman will know from his experience in the livestock business that if there are 1,000 lambs walking around the hills in Connemara that are required to be with a butcher in Paris on a Tuesday night, there is only one solution: they are sent in a truck, post-haste. It is on this that the economy hinges.
We are very passionate about what we do and, in light of our geographic location, it has not been easy to be one of the top exporting nations in the world. We are addicted to fuel. We do not have any options because the peat briquette-fired truck has not yet been invented. Our industry is on its knees for the want of relief on fuel; the position is that serious. We are dying a death and we are being bled to death.
Is there any mechanism which Mr. Quinn could suggest? We know that a straight rebate is one matter. We are all aware that the same diesel fuel will be used in cars and 4x4 vehicles. Does he suggest the introduction of a genuine rebate system of some description?
Mr. Quinn
The Department of Finance does not know how many litres of fuel the trucking business uses every year. Even if it were to allow a 2 cent rebate, it would then know that X litres were used to ship freight and that 10X million litres were used for SUVs or other alternative transport uses. This is an essential user rebate. When we came here today we could have come by horse, bicycle, train, DART or airplane. A company trying to truck goods into Europe does not have those options. This is why we see the rebate as the only workable solution.
When talking about a rebate, Mr. Quinn is referring to hauliers. However, it is also necessary to consider companies transporting their goods with their own vehicles. Can the Irish Road Haulage Association suggest any mechanism to reduce overall costs that we could propose to the Department of Finance?
Mr. Caulfield
That was emphasised in our submission. We sought it for tax-compliant licensed hauliers. Companies that transport their own goods are in control of the pricing and the amount of revenue they can get as they are selling the goods. However, as hauliers, we must take prices in most cases and we are not in control of the pricing. In order to carry goods for hire and reward a haulier must be licensed by the Department of Transport. It is easy to trace every licensed haulier in the country.
I agree. I can think of certain people who are known to us all, for example, Mr. Seán Quinn and those involved in quarries. They probably have the same costs. However, to give a reduction only to the hauliers would probably penalise those using the services of private operators vis-à-vis the haulage industry.
Mr. Quinn
We would take a different view. If I were to haul sand or gravel for Seán Quinn tomorrow, he would tell me that I would get €4 per tonne and I could take it or leave it. However, if I go to buy a tonne of cement from him, he will tell me what price I need to pay. I would not tell him the price for which I would buy it. Manufacturers have a different dynamic from the rest of us. The container hauliers were protesting on the streets this morning because the container people told them to sort out the toll issue themselves, as they would not pay the tolls. In an ideal world we would just add it at the end every time we got a price increase. However, that will not happen.
Is competition in haulage from outside the country really causing problems? European hauliers will fill their trucks at the last filling station when leaving the State. Many of them, especially those from Northern Ireland, now register their trucks here. How big an advantage do they get by doing this as opposed to staying in their own jurisdiction?
Mr. Quinn
Regardless of what Dr. Paisley thinks, the whole island of Ireland is one for the purpose of transport. The important part is jumping the water. People need to be as efficient as possible. When laying out money for a ferry, a haulier naturally wants to have a source of revenue to offset the ferry costs. Whereas in Europe people would run for hundreds of miles to pick up a reload, in Ireland and England the notion of crossing the water without a load is unheard of. A haulier must find some freight to fill the gap. There is a huge spin-off for the Exchequer in terms of the amount of diesel purchased here especially by UK and Northern Ireland hauliers. Under EU law, if we offered rebates, we would be required to offer rebates to others from outside the jurisdiction.
One wonders if our carbon emission figures are not being totally skewed by the amount of fuel purchased by foreigners here. I live close to the Border and to see lines of cars and trucks every weekend filling up in the Free State is phenomenal. It is a benefit to the Minister for Finance, Deputy Cowen, and good luck to him if he can get it. However, there are 16,000 licensed trucks in the country and 5,000 operators. The average is approximately two vehicles. These people do not have very deep pockets and their capital base has been eroded due to fuel prices. The energy issue did not just surface last week; it has been with us for some time. We had the pre-war premium, the actual war premium and the post-war premium. The only way is up and we need to address the issue. We need to find solutions quickly.
I do not have solutions this afternoon. I accept and support much of what the witnesses have said. I acknowledge the essential role of hauliers in the economy, especially as rail freight has virtually disappeared. The economy is hugely dependent on the efficient movement of goods in and out of the country as well as around it. Any Government would be anxious to facilitate the sector in so far as it is possible.
Mr. Caulfield referred to compliant hauliers. In reality they are not always compliant. They exceed speed limits and do not stay in the inside lane on motorways, even since Monday. I completely reject the use of bullyboy tactics of blockading the East Link or West Link, which is not the way to achieve a very legitimate objective to reduce those tolls. While we would all love to see them eliminated, it is not acceptable to upset other people going to work, regardless of the validity of the case. I remind the witnesses that the taxi industry used the same tactics in the past and got their answer from both the public and the Government. I urge the Irish Road Haulage Association to abandon that campaigning method.
I share the association's concerns about penalty points for driving in the outside lane. I know the hauliers are not observing this requirement. On Monday I carried out a test by driving on the inside lane at the speed limit of a HGV. Four HGVs and a cement mixer passed me out. They clearly were not worried about the penalty points. I tried to raise this matter with the Minister through parliamentary questions etc. and I want him at least to express a view. Thus far he has not expressed a view about the safety implications. I agree with the witnesses that there are safety implications of having convoys of slow moving trucks, with the danger of somebody finally losing patience and trying to pass out. We have not fully considered the impact of a mile of trucks on the road. It will only be a problem if hauliers are compliant with the rule. However, I will pursue the matter with the Minister on behalf of the association.
I sympathise with the association on the issue of fuel costs. I understand that in many ways hauliers are price takers. While I may be wrong, I cannot see how the Government could offer a rebate to certain users. I do not know whether this would even be acceptable under EU law. When very legitimate claims by disabled people for a VAT reduction on wheelchairs and other devices are not met, I find it hard to imagine the hauliers getting special treatment. While I could imagine the Government reducing excise duty for everybody, I could not imagine it doing so just for hauliers. Increasingly excise duty on diesel and petrol will be used as an environmental measure to incentivise or disincentivise certain behaviour and usage. I do not have a solution in this regard
I am relieved to hear the witnesses say they support the Dublin Port tunnel because nobody else seems to support it. I am not surprised the hauliers support it. The taxpayer is buying a €1 billion tunnel for the exclusive use of trucks. However, I agree that it was very badly thought out. I know the Minister is considering height restrictions for super cube trucks. In reality he cannot introduce a height restriction that is any lower than that permitted in Europe, as he has admitted. He certainly will not introduce a restriction lower than the highest truck already operating here. This is all hot air and I do not believe it will ever happen.
As someone who represents a suburban constituency, I can only envisage trouble from the usage of the tunnel and the management of traffic.
I am delighted to hear there will be no trucks on the quays, but there will be trucks everywhere else, as far as I can tell. There will be a little escape route for trucks on both sides — the East Wall Road to the north and the Seán Moore Road to the south. They will go into the little cordon between the canals and the M50 during the day because they will be unable to get into the city. I predict that there will be a concentration of trucks in that band around the city, particularly on the south side because the M50 exits will be available for trucks which are going to destinations to the south of the toll booth. While there might not be an increase in overall traffic volumes, traffic will be concentrated on certain roads, particularly on the south side of the city. I foresee all sorts of problems.
I would like to refer to a good proposal that was made, possibly by the Irish Road Haulage Association. It was proposed that when the Dublin Port tunnel opens, if that ever happens, a period of time should be set aside to see what traffic will do of its own accord. If the opening of the tunnel does not achieve what we want it to achieve, only then should we interfere to manage the flow of traffic. The representatives of the association are right when they state that most people do not want to go into the city unless they absolutely have to. Perhaps it would be a good idea to allow traffic to find its own level initially, for a month or two, so that we can see what happens. Has that idea been dropped? I thought I read that the city was——
Mr. Quinn
There will be a two-month moratorium on that particular proposal — the blanket or outright ban — after the tunnel opens before legislation starts to be adopted. They have agreed a permit——
Will decisions on future plans be taken after the two-month moratorium, or has it already been decided what will be done after the two-month period?
Mr. Quinn
The decision has already been made on what will be done after the two-month period.
That does not make any sense.
Mr. Quinn
We like to think the penny might drop and things might become obvious. Freight will take the path of least cost and least resistance — that is a given. When I spent my 20s driving trucks around Europe, I never chose to drive through a town if a convenient bypass was available. If one is driving a vehicle with 12 or 13 gears, one does not want to be clutching 1,000 times between the time one gets off the ferry and the time one gets to the Naas Road. As someone who has experience of driving through London before the M25 was completed and driving through it subsequently, I am aware that the difference is like that between day and night. There will be a massive migration to the ring road. There is no doubt about that.
Does Mr. Quinn agree with what I am saying about the band between the M50 and the canals?
Mr. Quinn
It is probable that there will not be any increase in such areas. There will probably be a substantial decrease on the East Wall Road. I imagine that traffic levels on the East Wall Road will decrease by between 70% and 80%, which is good news for everyone living in areas between the East Wall Road and the airport, such as Drumcondra. That is a huge plus. Several groups have identified that enormous financial penalties will be imposed on haulage companies if container vehicles leaving South Bank Quay to go to somewhere like Leopardstown are forced to cross the East Link Bridge and the West Link Bridge, rather than travelling along Seán Moore Road. To estimate the costs of such a requirement is a total no-brainer. Vehicles using Seán Moore Road to travel south to the N11 or the Leopardstown industrial complex would have to pay a toll if the toll plaza collection point were to be moved. That would be equitable and fair because it would dissuade people——
Did Mr. Quinn say they would pay a toll in such circumstances?
Mr. Quinn
If drivers paid a toll when turning left from the South Bank Quay complex, they would be dissuaded from using that area as a rat-run. In other words, they would pay just one toll if they turned left, via Seán Moore Road, or if they turned right, when they cross the city and eventually reach the West Link Bridge. The relocation of the eastern toll bridge would have an equalising effect in terms of tolls.
What would that achieve? If the traffic levels on Seán Moore Road were reduced, where would that traffic go?
Mr. Quinn
The traffic accessing Leopardstown and the N11 would continue to go that way because it would make sense for them from the perspectives of mileage and accessibility. If the toll was payable by those who turn left after they leave the south docks, it would discourage those who have options from using Seán Moore Road as a rat-run. Does the Deputy understand the point I am making?
I understand the point, but I think it is a tortuous approach.
Mr. Quinn
Nothing is being done at the Irish Glass Bottle site at present, even though it is just a matter of developing a truck lane in the area, which would be pretty simple from an engineering point of view. When one is collecting tolls at the rate that money is being collected at present, it is well worth one's while to spend €100,000 on concrete to make it right and simple.
I welcome the Irish Road Haulage Association delegation to this meeting of the joint committee. It is somewhat surprising that we have not previously met at this forum. I apologise in advance because Deputy Olivia Mitchell and I will have to leave at 3.40 p.m. to go to the Dáil Chamber. It is regrettable that the committee has such a short time to deal with such a long agenda. I hope the representatives of the association will come to see us again in the not too distant future. A huge range of issues is under discussion.
Mr. Caulfield spoke about the association's submission to the Department of Finance. I do not think any of the documentation that was sent to the committee contains information about that submission. I ask the association to give the committee some further details in that regard. I would like to follow up on that with the Minister for Finance.
Has the association conducted any research into the cost of tolling to the road haulage industry? What percentage of the overall costs of hauliers is represented by tolling at present? Does the association have any projections of how that is likely to increase after the Dublin Port tunnel has been opened?
I am also interested in the percentage of hauliers' costs that is represented by fuel. I did some work recently on AA Ireland's proposal that tolls be eliminated completely and that a surcharge be put on fuel so that a shadow toll can be paid in that way. What is the Irish Road Haulage Association's view on that proposal? It would make sense, from an environmental perspective, for road users to pay more money if they travel further. Does the association have a view on that suggestion, bearing in mind the level of fuel costs that its members are incurring at present?
I am interested in the association's proposal that the toll booth at the East Link Bridge should be relocated. It is the first time that I have come across such a proposal. I do not know whether anyone else has seen it. I like to think I am fairly up-to-date on the various transport proposals.
Mr. Quinn
Our proposal was made in a document that we can furnish to the Deputy.
I have read the document in question, although I did not notice the interesting proposal to which I refer. Has the association received any feedback on the proposal from anyone at official level?
Mr. Quinn
We expect City Hall to get back to us on it quite soon on foot of today's disturbance. If violence is the last resort of the incompetent, today's protest was the last resort of the frustrated. The association is quite frustrated because it has invested great efforts in producing positive and constructive proposals on how this matter should be managed. Its members are annoyed because the association has been getting the mushroom treatment — it has been kept in the dark and fed plenty of horse manure — over the last 18 months. The association's biggest problem today was to limit the protest and ensure it was concentrated in that part of the city. The members of the committee are lucky that some members of the association were not here to welcome them to work this morning. It costs a great deal of money to keep 100 trucks idle for a day. It is not funny that equipment worth approximately €10 million was unused. The association does not want to have to get involved in such protests, which can be seen as an indication of the seriousness with which hauliers view this problem.
A haulier will be paid approximately €130 to take a container from South Bank Quay to the Naas Road, which currently involves a free run through the city. He will lose approximately €22 from those earnings if he has to pay tolls on the East Link Bridge and the West Link Bridge. If the haulier does not make a profit of €22 on the movement in the first place, he will lose money by doing the job.
Fuel costs comprise between 25% and 33% of one's total operational costs, depending on one's operation. Such costs are bigger factors for hauliers who do long-distance European transport, covering huge mileage. Many such hauliers have large tanks in their lorries so that they do not have to buy fuel in the UK or other expensive destinations.
The association's principal objection to tolls is that they represent a third layer of taxation, on top of fuel tax and road tax at €2,500 a time. A single vehicle can throw approximately €25,000 into the Government's pot each year. It is fine and dandy if the Government wishes to rebalance the current costs, as long as it understands that there is not an infinite amount of money in the transport sector to be mined to pay for infrastructure. The association has already made the point that all businesses benefit from improved infrastructure. We proposed at one stage that a 1% levy on turnover would go a long way to funding this country's annual infrastructure costs.
The practice of throwing coins into a bucket belongs to the previous century. There is merit in the argument that 2% or 3% of annual fuel revenues should be allocated to cover infrastructure but this must be done on a pan-European basis. Irish exporters are being fleeced by road tolls in France, Italy and Spain, the Maut, a charge per kilometre, in Germany and the Euro-vignette charges in the Benelux countries. Vehicles from these countries have a free run when they enter Britain and Ireland, which creates a problem. Given that we have a common travel area, we should also have some form of charge for foreign vehicles entering Britain and Ireland as this would go a long way towards levelling the playing field.
An interesting point was raised regarding restrictions under the HGV strategy and the need for a level playing field. I have not come across this argument before and I will follow up on it by tabling questions to the Minister. In respect of road safety in the haulage industry, what is the state of preparedness in the industry for the introduction of the digital tachograph next month?
I noted a letter in the newspapers recently by Mr. Caulfield in which he referred to making representations to the Minister to have the issue of fitting cyclops mirrors addressed. The Minister responded to a question I tabled regarding these representations by indicating that there was no record of any such representations being made by the association. Will Mr. Caulfield provide more detail on this matter because it is of major concern to cyclists and pedestrians?
Mr. Caulfield
I understand that from January 2007 European Union law will require new vehicles to be fitted with convex mirrors. Yesterday, the association suggested to the Minister of State, Deputy Gallagher, that he consider introducing, by ministerial order or other means, a requirement that vehicles undertaking the annual DOE test be fitted with convex mirrors. This would ensure that all vehicles would be retrofitted with these mirrors within one year.
The association made that proposal yesterday but Mr. Caulfield's letter indicated it had been pleading with the Minister for years to address the issue of mirrors.
Mr. Caulfield
Two years ago, Deputy McDaid, as Minister of State at the Department of Transport, attended a safety launch we held in conjunction with schools, the Council for the Aged and others. We ran a poster campaign, sending posters to all schools.
The association is supportive of proposals to make cyclops mandatory on all heavy goods vehicles, old and new.
Mr. Caulfield
Yes, and we have been for a long time.
Mr. Quinn
It is disgraceful that people have died because others did not listen to us.
The Minister claims he did not receive representations from the Irish Road Haulage Association.
Mr. Quinn
I can state, hand on heart, that I begged and pleaded with the former Ministers of State, Deputies McDaid and Callely, to take the action we proposed to the Minister of State, Deputy Gallagher, yesterday. We have driven this issue based on representations I received from Inspector Jim Marks in Carrickmacross, with whom I identified about ten people who had been killed in the previous six months due to the absence of these mirrors. We have pushed this issue hard and it is frustrating to see officialdom dragging its heels on it. This measure should have been introduced at the drop of a hat and the failure to do so is a black mark against the relevant Ministers.
On the digital tachograph the manufacturers have finally got their act together and all vehicles delivered from 1 May will be equipped with such devices. The digital tachograph is the next generation of recording equipment. It is a simple device which records information on a hard disk rather than paper. It makes no difference to the safety of vehicles or how they are operated.
The association takes safety very seriously because every fatality costs about €1 million. Insurance companies would put goods vehicles with high risk out of business. We consider the benchmark for accidents to be two incidents per million kilometres. One must bear in mind that a HGV will travel approximately 160,000 km per annum. The stated aim of the Irish Road Haulage Association is to introduce measures to reduce accidents to this benchmark. That would be a good achievement. While the ideal position would be to have no accidents, as we are all aware, people fall off ladders or slip getting out of the bath.
We seek to persuade all road users to take ownership of road safety and stop blaming the Government, Garda Síochana and others. Cyclists make headlines out of the fact that 17 cyclists were killed in a five-year period. If cyclists chose not use iPods or wear headphones and, instead, paid attention to traffic, they would stand a better chance of staying alive. We must all play our part in delivering road safety. I am involved in delivering goods in Dublin and it is a nightmare trying to protect people from themselves. Even a simple measure such as making jaywalking an offence could save lives every year. We must all buy into road safety and the Irish Road Haulage Association is aware of its obligations in that regard.
Mr. Caulfield
On the digital tachograph, the Department is now in a position to issue the cards to drivers and some drivers and fleet owners have already received them. As soon as the lorries fitted with the new equipment come on stream, the Department and hauliers will be in a position to operate the new tachograph.
Deputy Olivia Mitchell referred to our bad record in the area of speeding — I believe she was referring to motorways. The national speed limit for heavy goods vehicles is 80 kmh and the limiter is set at 85 kmh or 86 kmh. The association believes lorries should be allowed to travel on motorways at the speed indicated on the limiter. This is not a safety issue as motorways are the safest roads on which to drive. Such a measure would probably help the flow of traffic.
I am sorry I did not hear the initial contribution. The delegation is welcome. Coming from the west, it is clear that hauliers play an extremely important commercial role. I was present during the discussion on fuel costs. Of the overall number of hauliers, how many are members of the Irish Road Haulage Organisation?
Mr. Caulfield
We have approximately 1,500 members and represent more than half the lorries on the roads. Some of our members have fleets of eight or ten vehicles while others are single vehicle owners.
A number of my constituents in the haulage business with only one or two lorries inform me that the main problem faced by hauliers is their inability to pass on costs to the market. Insurance premiums, export licences and so forth must be paid and competition is cut-throat.
The Irish Road Haulage Organisation makes a fair case in calling for some form of rebate on fuels. As a long-standing Member of the House, however, I have learned that it is almost impossible to make a special case for one industry with the Department of Finance.
I have been convinced by acquaintances operating in the transport business than hauliers are worse off now than five years ago. The position will be infinitely worse, however, if interest rates continue to rise because many hauliers have large borrowings.
The delegation stated that fuel accounts for 25% to 33% of costs. I understood the figure was even higher. I assume the association has given careful consideration to the issue of a national rebate. Several years ago, an attempt was made to give fishermen a rebate on diesel. That did not work. I know very little about the fishing industry but I am told the reason is that it was not possible to pinpoint the need or to get the rebate down to where it would count most.
At the risk of going over the ground that has been covered, it is in the interest of the delegation to come up with a plan that would be bought by the various Ministers to assist those who need help but that would not open the floodgates to everybody. According to what I have heard today a mechanism has not yet been devised. It could be said that it is the job of Government to do this, but the Irish Road Haulage Association is no different to the IFA or other pressure groups, which do an important job for their members. I would like to think the association could come up with something that would help us to make a case that the Government would accept. I would be interested in assisting the group if it should come up with anything but I have not heard anything yet that any Minister for Finance would accept, regardless of who is in office. I accept this may not be music to the ears of the delegation but I urge it to offer some indication of how what it wants might happen.
Mr. Caulfield
Unfortunately, the document prepared by BDO Simpson Xavier that we presented to the Department of Finance does not appear to have been circulated. We will ensure it is made available at the first opportunity. We outlined in it a possible method for how this could be done, in a similar way to the VAT-free fund. This could be of benefit to the Department of Finance because it would help eliminate the use of illegal or washed fuel and agricultural diesel. We would probably compete on a more level playing pitch in which only tax compliant licensed hauliers would be in a position to get a rebate on the fuel.
Is washed fuel a major problem? I accept it is a major problem in certain areas but is it a significant feature in the haulage industry? Do people arrange to buy washed fuel on the black market? If that were the case, the person competing legitimately would not have any chance.
Mr. Caulfield
We are aware that a significant quantity of fuel is being washed and used but nobody ever admits to it. However, it is happening.
Mr. Quinn
Washed fuel is frequently passed off as legitimate fuel.
That is a significant issue.
Mr. Quinn
There is no point in the Minister telling us that patrols are being increased. They are not catching a fraction of it. One could not fire a stick across a hedge in south Armagh but one would hit an oil tanker. We must have more oil tankers in south Armagh than there is in the whole of Texas. The situation is totally out of control.
When they crash them now, they abandon them. They do not even come to collect them.
Mr. Quinn
That is right. Residue and sludge is being left on the side of the road for county councils to dispose of at enormous cost. If one eliminates the need for people to purchase that kind of fuel, one would eliminate——
Roughly, what price would legitimate fuel have to be, to compete with illegal fuel?
Mr. Quinn
Our suggestion would be to have it 5 cent a litre cheaper. There is a downside attached to using washed fuel in that it is hard on pumps, equipment and the environment. The rebate system could be made very transparent. It would not be available on cash sales and would only be payable on a VAT docket. That would be a legitimate form of reclaim. It would be important to quantify the amount of fuel used in the transport sector. Those not claiming it would be drawn to the attention of the Revenue because few people could make so much money from transport that they could afford to ignore the rebate.
All kinds of things are happening behind legitimate fronts these days, in terms of tobacco, alcohol and drug smuggling. The two biggest car ferries in the world tie up in Dublin every morning. Some 400 vehicles come off them. A great deal of harm is being done. We have no brief to hide illegitimate people in our industry. They are a nuisance and they destroy and undermine the valuable work done by legitimate operators. We should take a leap of faith and introduce a rebate scheme. There are precedents for it in Europe, in France and other countries where it exists in a limited way. Even 3 or 4 cent a litre would make a great difference to somebody burning 500,000 litres a year. It could mean the difference between staying in business and going bust.
Would that kind of reduction right across diesel sales have the desired effect?
Mr. Quinn
The oil companies would grab it for starters.
That is where I am coming from. Basically the middle people would pick it up. It is similar to what we have seen in regard to other incentives where they were added on to the original supplier.
Mr. Quinn
Diesel fuel was always cheaper than petrol to reflect the fact that it is cheaper to make and it is kinder to the environment. It is a source of frustration that the differential is practically gone. To put the matter in perspective, we have 16,000 licensed trucks on the road. At worst, it is a definable quantity of fuel. Let us compare that to the million cars that have been registered in Ireland since 2000. In terms of traffic congestion, the Kyoto Protocol and so on, it is plain that the essential movement of freight should not be targeted on environmental grounds because the alternative is to stay at home and do nothing. In that way, we would not damage the environment but we would not do anything else either.
Many environmentalists are unaware that trucks now produce one sixth of the emissions they produced ten years ago and probably one twentieth of what they produced 15 years ago. The newer trucks are reasonably environmentally friendly.
Mr. Quinn
Euro 4 and Euro 5 are coming on line. We have paid through the nose for the refinements that have been delivered. Those refinements are obvious. A lawnmower now makes more money than a fully laden 44 tonne articulated truck. A Harley Davidson or Ducati makes a modern 500 horsepower truck look very quiet. All this has cost us money over the years in terms of reducing the environmental impact, noise, impact, ABS brakes and other such technology. There is more computing power in a truck than there is in a 1970s transatlantic airliner. All of that has cost us money. We are being squeezed by big business, big oil and big government and we need relief. That is why we are here.
I thank the delegation for sharing this information with the committee. I wonder why the common sense of much of this information is not being accepted. I met a haulier from Rush recently who indicated he would be faster going to Warrenpoint, collecting a container and returning to Rush than leaving Rush, coming to Dublin Port and going back to Rush. He also indicated that on the M50 he gets a half mile to the gallon. Those figures are completely unsustainable in terms of saving the environment. I do not understand how anyone could contemplate increasing the number of trucks to compensate for the height issue. This beggars belief.
The diagram I am looking at is worth a thousand words. It shows the merits of relocating the East Link toll to Seán Moore Road and to leaving the port itself toll free. What does Mr. Quinn believe is the future for Dublin Port, given that a haulier from Rush can get to Warrenpoint and back more quickly than he can to Dublin, or when one looks at the efficiencies that can be made in terms of the cost of going as far as the town centre in Tallaght to drop off a container and back to Rush?
Mr. Quinn
Studying great cities around the world such as San Francisco and New York, real estate by the waterside is worth much more money in terms of condominiums, conference centres, hotels and berthing for cruise liners rather than storing empty containers. There is great merit in the Braemore argument, especially for the container business. I predict there will be no containers at Dublin Port in 30 years. The port tunnel will be an enormous asset and I hope the remaining part of the ring route will be completed by that stage. Like all modern European cities, Dublin will have a full 360° bypass. This is to be welcomed. There is great merit in relocating the container function, and probably the fuel function, to Braemore.
People like to arrive in the city when using ro-ro ferries. The Dún Laoghaire ferry port is a good example and has a very successful express rate service. The people who tend to use it are those with cars or operators with small vans with goods to be delivered urgently. One needs a mix of cars and freight to make ro-ro services work. Containers, oil, bulk animal feeds and zinc ore from Tara, for example, could be located somewhere other than in Dublin to free up the real estate for other purposes. This would make much more sense in many respects.
What are the logistics, costs or savings incurred by port movement on foot of relocating the toll plaza to Sean Moore Road from the East Link?
Mr. Quinn
Let us assume that we do nothing with the existing lanes apart from creating an express truck lane, such that trucks would not have to pay going through the toll plaza. They would approach via the port tunnel, cross the river and drive onto the south bank quay, where they would pick up and drop their loads, and return through the toll plaza again, with no toll payable. Vehicles leaving the south bank quay and turning left onto Sean Moore Road to go to Dún Laoghaire would be liable for a toll, as would vehicles crossing the West Link Bridge. If one were leaving the port to go south or to cross the West Link Bridge, one would pay money. People on the N1, N2 and N3 have a free ride, purely through a geographical accident, and we cannot really help that.
Society will reap a dividend from the project and the benefit will be tangible. We pushed this project when nobody wanted to know about it. Many of the politicians who will be at the opening of the development slapping each other on the back were the cause of our losing £100 million in grant money from Europe. We will not be shy about reminding them about this if they refuse to take our concerns on board.
I thank Mr. Caulfield and Mr. Quinn for explaining their problems. Some of us can understand them more than others because we see what they are talking about every day.
Has anyone calculated the savings, per kilometre or mile, that accrue from trucks driving on a motorway rather than on a regional road?
Mr. Caulfield
There has been no detailed or scientific study. Those who operate the N4 are assessing the advantages or disadvantages of using that road rather than the toll road. Taking diesel costs and time into account, they estimate there is a difference of less than €1.
I wondered because I know somebody did the exercise and arrived at a figure greater than €1.
Mr. Caulfield
People have different methods of calculation.
It probably depends on the vehicle, the load, etc.
Mr. Caulfield
The margins are so tight that the toll money is regarded as money being drained from the business.
There may be a perception of false economy. Some feel that because they save the cost of the toll, be it €12 or €13, on a run to Dublin, they are gaining half of this in profit. Some will tell one that if one is unfortunate to be caught behind a vehicle from Kinnegad to Kilcock, one could lose half an hour. One should therefore factor in the cost of paying a driver for half an hour and the fuel used in that time.
Mr. Quinn
Perhaps it is worth restating our position on tolls. We fully accept that they will be a fact of life in the future. Toll roads come into their own in certain circumstances. If a vehicle is working close to maximum efficiency, it can travel 50 miles every hour. If it is operating at cruising speed, it is delivering maximum economy. However, if I have parted with my €5.80 on the M50 and am travelling at 2 mph, I am on a double loser. No doubt, when the toll and road networks are complete and we can drive from Dublin to Galway or Cork at a guaranteed 50 mph, the benefits will become much more apparent. If one gets off the shuttle in Calais when going to Madrid, the first traffic light one sees is on the Spanish border. One is therefore guaranteed that one can travel 50 miles every hour.
Since we are buying wholesale we have tried to do deals with the toll companies in Ireland on behalf our members. We cannot combine to talk about prices because of competition law, but we can certainly combine to talk about purchasing and we have succeeded in doing deals with National Toll Roads. However, a real cause for concern is the fact that the North Link operators will not deal with us. There is still a substantial number of drivers, especially from the North of Ireland, who will not use that road on pain of death. This is very foolish.
We want the most modern system possible. We want automatic toll readers and do not want to part with money. Money should be deducted electronically and one should get one's invoice by e-mail. This is e-business at its finest and we reckon it results in a substantial saving in terms of counting cash, paying Brinks Allied Limited to haul it away and getting robbed in the meantime. In this regard, one should bear in mind all the disadvantages of handling tonnes of coins.
The reluctance of toll companies to engage with us and offer us deals is a cause of great frustration. This is giving tolling a bad name in Ireland. We were getting rebates of 30% to 40% for volume when crossing the mountains into Italy 20 years ago. If I were to buy ten trucks tomorrow, I would get them at a cheaper rate than I would if I were buying only one. As purchasers, we need to do our deals according to such a principle but unfortunately it is being ignored at present.
I sympathise with the cube truck operators — I have said this publicly. Certain industries will be at a competitive disadvantage if they are unable to use cube trucks. This will have to be examined. Some sort of permit system should be considered to make allowances for vehicles that will not be able to use the port tunnel but which need to get to the port, via the quays or other roads.
If the committee can be of any help to the Irish Road Haulage Association, it will only be to glad to hear from it again. On the question of a rebate system, could the association produce a paper on how it might operate? A rebate system looks simple but when one considers all its knock-on effects, one realises it might not be. I have no doubt the system would be circumvented and in this regard I can think of half a dozen ways one could do so if one wished. Perhaps legitimate owners might get some other sort of rebate, perhaps through lower road tax. We all know that road tax for a taxi was lower than for private cars in the old days. Perhaps such as system would allow for a rebate based on vehicle use.
I thank Mr. Caulfield and Mr. Quinn for attending. I hope common sense will prevail on every side so this matter can be resolved.
The joint committee adjourned at 4.10 p.m. until 9.30 a.m. on Thursday, 6 April 2006.