RHA appalled at ‘financial standing’ revelation

The Road Haulage Association is appalled that the Department for Transport has increased the financial standing requirement for the hire or reward sector by a staggering 30% with effect from 1 January 2010. 

Hauliers will now have to show cash reserves of £8,100 for the first vehicle (up from £6,200) and £4,500 for each additional vehicle (up from £3,400)

“This increase represents one of the biggest bombshells ever to hit UK transport operators”, said RHA Chief Executive Geoff Dunning.  In the current economic climate, an increase of any kind will have a detrimental effect; this substantial hike could have a catastrophic effect on our industry”.

The change is entirely down to the devaluation of the pound against the Euro.  European Directive 96/92/EC requires all non-euro countries to revalue every five years. The DfT has stressed that the increase is mandatory and follows a fixed formula. The Euro figures remain unchanged at 9,000 and 5,000 respectively for hauliers in countries using the Euro.

“We are responding on three fronts”, continued Geoff Dunning. Firstly, RHA staff has extensive experience of guiding members through the financial standing process and members are urged to contact their regional help desk for advice. 

“Secondly, we have urged DfT minister Paul Clark, to approach the European Commission with a request for a delay in implementing this change

“Thirdly, we are in discussion with the Senior Traffic Commissioner over the guidance to TCs on how the minimum financial level is assessed. 

“In a submission made before Christmas, the RHA stressed that it had no desire to see operators running trucks that they could not afford to operate safely. However, the current financial standing rules go well beyond that.

“Meanwhile, we have noted to both Government and the Traffic Commissioners that the financial standing requirement for restricted licence holders remains unchanged at £3,100 and £1,700. 

“The fact that the UK has chosen to freeze the level for such firms to avoid further regulatory burden underlines the harshness of the financial burden that is now being imposed”.