Driver Shortages and Rising Fleet Insurance Premiums Among Concerns On The Irish Roads

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The Irish government is pledging extra funds to improve transport infrastructure to deal with a more “uncertain world”. What is it planning and how will it help soothe some of the myriad challenges faced by the nation’s vital logistics sector? Driver shortages and rising fleet premiums are among concerns in the logistics industry:

 

Highlights

  • The road transport industry is anxious to ensure Ireland has the necessary infrastructure in place to cope with potential border delays following Brexit
  • In addition to earlier pledges, the government has promised €500m of extra spending on infrastructure each year between 2019 and 2021
  • Other industry concerns are driver shortages and rising fleet insurance premiums

In July as part of his Summer Economic Statement, Minister for Finance and Public expenditure and Reform, Paschal Donohoe TD said €500m of additional capital spending would go to economic and social infrastructure each year between 2019 and 2021.

“We live in an increasingly uncertain world and must plan accordingly,” the Minister said. “To this end, the government will maintain a rainy-day fund while at the same time increasing public investment.”

It built on a January 2017 pledge by the Minister of an increase in investment in transport projects involving ports, airports and roads to ensure the country had the necessary infrastructure in place to cope with the demands of Brexit.

Budget deadline

This revision of the government’s capital investment programme up to 2021 is expected to be completed in time for the October Budget. Most of the projects are under wraps but it’s expected that work will be carried out to increase port capacity in Dublin and ensure better links between the Port of Cork and the national roads network.

Engineers Ireland agrees for the need to increase the allocation of capital investment in transport infrastructure. However, it wants the government to go further by establishing a single infrastructure unit to “ensure effective delivery and long-term return on this investment”. In ‘The State of Ireland 2017: a review of infrastructure in Ireland’, published in July, the professional body called on the acceleration of plans to develop the M20 Cork to Limerick motorway, for variable speed limits to be brought in on the M50, and for multi-point tolling to ease congestion.

“While progress has been made in terms of increasing capital investment and quickening of project delivery, there are still some frustrating delays with infrastructure,” said Dr Kieran Feighan, president of the group, at the launch of the report.

Traffic flow

A spokesperson for Transport Infrastructure Ireland (TII), the agency responsible for the development and operation of the national road and rail network, agrees that variable speed limits on the M50 are important. “It will help mitigate and manage traffic flow and help hauliers and logistics firms get in and out of Dublin Port easier,” he says. “There is heavy demand around the port and what hauliers need is consistency on journey times. There is also a disconnect between Cork and Limerick in terms of a lack of motorway access. There is a link in the chain missing.”

However, the TII said it was happy to hear the emphasis placed by the government on the need to improve infrastructure in relation to the movement of goods and services by road.

So, what do logistics companies think?

Delays expected

Infrastructure improvement is needed as soon as possible, says Verona Murphy, president of the Irish Road Haulage Association and owner of Verona Murphy Transport in County Wexford. “We need to make sure our infrastructure is top notch to cope with the impact that road transport will face from Brexit,” she says.

“We are expecting an increase in land border delays of at least one hour per truck and we also need more work done at Dublin Port to ensure we’re ready to deal with new customs checks and regulations. We’re the most geographically displaced country in Europe and we need to go through the UK to get to the continent. I need to be able to tell my European customers when our load is coming, but that will be difficult if we don’t know how long border delays will be.”

Murphy believes Ireland should be considered for state aid exemption when it comes to developing infrastructure to improve transport times in Ireland and mitigate some of the disruption caused by border delays.

“We need to make sure our infrastructure is top notch to cope with the impact that road transport will face from Brexit”

Verona Murphy, president, Irish Road Haulage Association

It’s hard to pinpoint where infrastructure is best needed – either on the North/South border crossings, or at the ports, says Laurence O’Toole, managing director of Galway-based O’Toole Transport.

“We certainly need more port infrastructure, especially parking and other facilities as we are sure to experience more delays after Brexit,” he says. “A delay of more than an hour is going to be catastrophic for the sector. We need more national infrastructure to help us cope and I would love to see some movement on the Cork to Limerick motorway, which has been on the shelf, then off and back on again. But generally, the government has been supportive when it comes to infrastructure investment over the last 15 years in improving roads and motorways.”

Indeed, Alan Miles, managing director of Maxi Haulage, which has offices in Dublin and the UK, believes the Irish road network is superior. “When you look at the networks between Belfast and Dublin and elsewhere in the country, it is better than the UK certainly in terms of traffic congestion,” he says. “I would, however, like to see more work done at Dublin Port. There is very little space there for parking up and for warehouse facilities. There are development works planned there but it needs to be ensured that it won’t add to any disruption.”

Miles says the strength of the Irish economy means a rare imbalance of loads between the UK and Ireland at present. “Demand from the UK is up while demand coming from Ireland is down a little. Certainly, the construction industry is finding a home for their products more readily in Ireland than the UK,” he says. “We aren’t seeing too many challenges in Ireland.”

Driver shortage

Murphy, however, is facing a number of other industry headaches.

“As a sector, we’re facing a driver shortage. We need the government to process more non-EU work permits to help us find drivers,” she says. “We are also facing an issue with a slowdown in the number of imports from the UK to Ireland. We can’t get backloads coming back to Ireland and rates are lowering.”

Another concern is rising fleet insurance premiums. “Our insurance has gone up 300% in the last three months even though we have a full no-claims bonus. The European Commission is now looking at it from a competition perspective,” she says. “Haulage is the number one sector in this country. If goods don’t get to market either here or abroad then we will suffer. But I don’t think the government sees us as being in that number one position.”

O’Toole says his insurance premiums have recently leapt by 70%. “The government needs to allow new entrants into the insurance market as it is a closed shop at present,” he says.

On the motorway tolls, O’Toole says: “Until a year ago we were able to reclaim VAT on the M50 toll but we can’t do that now, which has cost us €30,000. We hope that doesn’t happen on the other tolls up and down the country.”

Murphy wants hauliers to be given special category status in relation to more lenient fuel rebates and reduction in motorway toll payments. “Tolls and fuel are our biggest cost. As a sector, we have to be sustainable to help us prepare for the future,” she says.

The government’s infrastructure pledges are clearly welcomed by the industry but more support in other crucial areas such as rising insurance, fuel costs and driver shortages may be needed in the vital months and years ahead.

Projects the industry wants to see

1. M2O motorway between Cork and Limerick. Much discussed route between two of Ireland’s biggest cities.

2. Dublin Port expansion. Work is being done on the Alexandra Basin redevelopment to deepen it for larger vessels. More parking spaces, warehouses and facilities for drivers also needed.

3. M50 – variable speed limits to improve traffic management.

 

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