Up to quarter of supermarket milk deliveries missed due to driver shortages, says dairy giant
Up to a quarter of supermarket milk deliveries by the UK’s biggest dairy supplier have been unable to get through because of a shortage of lorry drivers.
Speaking to Sky News, managing director of Arla Foods UK Ash Amirahmadi warned of a “summer of disruption” unless bold action is taken by the government to tackle the industry-wide problem, blamed on the coronavirus crisis and Brexit.
The dairy giant, which supplies milk to about 2,400 stores each day in the UK, had on average failed to deliver to 10% of outlets due to a lack of drivers, although this had risen to a quarter – some 600 shops – at weekends.
“Of course that’s something that is a concern,” said Mr Amirahmadi.
As well as “significantly” increasing driver pay, Arla had also offered a £2,000 signing-on bonus, similar to other businesses, like Tesco.
In addition, the company was working with retailers to try and reduce the demand on the supply network.
But Mr Amirahmadi said: “Unfortunately, even with all those things in place we are still not able to make all of our deliveries.”
While a recent move to extend hauliers’ working hours by an hour would help, he added: “We don’t think that is the solution because it doesn’t sort the underlying issue, which is the shortage of drivers.”
Confirming the company was in discussions with the government, Mr Amirahmadi said: “We need to recognise it is a structural issue, that what we have at the moment is an acute driver shortage.
“Therefore, unless we take bold action on that we could be facing a summer disruption going into the next couple of months.”
Mr Amirahmadi highlighted the need to increase HGV driver testing and temporary visa changes, to deal with the shortage in the short-term.
In the longer term, Arla were committed to drawing on “homegrown talent” through its own training schemes, including apprenticeships.
Dr Judith Bryans, chief executive of the industry body Dairy UK, said: “The UK dairy supply chain has seen quite a bit of disruption as a result of on-going shortages of HGV drivers, causing difficulties for businesses in terms of transporting products.”
Earlier this month, Transport Secretary Grant Shapps announced a consultation to ease driver qualification requirements as part of a package of measures designed to tackle the issue, in addition to the temporary extension of lorry drivers’ working hours from nine to 10 hours a day.
However, the Road Haulage Association, which has said it believes there is a shortage of 100,000 drivers, described the relaxation as a “sticking plaster”.
A Department for Transport spokesman said: “We recently announced a package of measures to help tackle the HGV driver shortage, including plans to streamline the process for new drivers to gain their HGV licence and to increase the number of tests able to be conducted.
“We have also temporarily relaxed drivers’ hours rules to allow HGV drivers to make slightly longer journeys, but these must only be used where necessary and must not compromise driver safety.
“We have no plans to introduce a short-term visa for HGV drivers. Employers should invest in our domestic workforce instead of relying on labour from abroad.”
Number of landlords selling up rises by nearly 13% in four months
The number of landlords selling up has risen by nearly 13% in four months, Sky News has learned.
The statistics, given to us by the estate agents trade body Propertymark, show an increase from July to October.
Why should we care what happens to landlords?
In basic terms, if the landlord exodus continues we could end up with a housing crisis on our hands.
That is mainly because we have, as a country, become over-reliant on the private rental sector.
“Generation rent” is no longer your stereotypical “twenty-something” professional.
Now it’s made up, increasingly, of older generations, even pensioners, alongside a rising number of “social” tenants.
Government figures show more than 25% of households renting privately are in receipt of housing benefits.
That is, quite simply, because we do not have enough social housing.
As a result we are seeing different “groups” of people converging, and all competing for the same space within the rental sector.
A lack of affordable housing is, at the same time, exerting pressure from another direction.
Despite a housing market dip with property prices falling, many households aspiring to own their own property are unable to save up.
Yoana Miteva, a British citizen who moved from Bulgaria to England twelve years ago, describes it as “mission impossible”.
She has been working full time, even taking on a second job, to try to put money aside.
Rent rises have meant added financial pressure forcing her to move home, in addition to energy bills, the cost of living, and house price inflation overall,
Tearful, she tells me she feels “like a hamster in a wheel…running and running, I’m trying to run faster, taking a second and third job, and I’m still well behind”.
As more landlords leave, rents rise as demand further outstrips supply.
The main reasons for landlords selling are down to mortgage rate rises and government legislation.
Private rented sector ‘invisibly buckling’ under pressure
Nathan Emerson, CEO of Propertymark, describes the private rented sector as “invisibly buckling” under increasing pressure for a while.
He says if the sector doesn’t work for a landlord “they will simply sell, meaning there’s one less home for a tenant”.
Landlords themselves are asking for the government to step in and change the rules to help make it easier to create “viable” businesses.
Sean Gillespie, a landlord in Hull, says his colleagues are “jumping ship” because their rented properties are financially “unsustainable”.
He asks: “How can landlords survive? They survive by putting rents up.”
Government rules blamed for tax increases
Government rules are being blamed, specifically “Section 24”, for tax increases which mean it’s no longer possible to offset business costs.
Mr Gillespie says it is “absolutely destroying” the sector.
“We can’t change the interest rates at the moment,” he adds, “but we can repeal Section 24 which is the increased taxation since 2015… if landlords don’t make any money, they can’t run a business, can’t provide housing, can’t repair houses.”
They may be generally unpopular, often vilified, but we need landlords.
If they disappear in increasing numbers, the question remains, without enough social or affordable housing – where will people live?
John Lewis reveals £500m plan to build 1,000 rental homes
The John Lewis Partnership has revealed plans to build 1,000 rental properties on its land as part of a drive to diversify its business.
The employee-owned group, which is spearheaded by its eponymous department stores and Waitrose supermarkets, said a joint venture with investment firm abrdn aimed to achieve a tenth of its ambition to build 10,000 new homes over the next decade.
It would see John Lewis develop and manage the proposed new sites in Bromley and West Ealing in Greater London, which would require Waitrose shops to be redeveloped.
A vacant John Lewis warehouse, at Reading in Berkshire, would also be transformed under the plans.
The project, which is subject to planning permission, includes commitments to affordable housing and sustainability tied to its 2035 net-zero pledge, the partnership said.
“We want to create homes that will provide a stable income for the partnership, and moving into housing aligns with our purpose to make a positive difference for our partners, customers and communities”, the statement added.
The sites were chosen according to their central location and proximity to transport links.
It announced the investment against a backdrop of record private rental costs, with tenants across the UK facing an average monthly bill of over £1,100 per month.
Across London, the figure is double that sum following a 22% year-on-year increase during the first nine months of 2022 according to estate agency Foxtons.
John Lewis said its plans would help ease a shortage of 75,000 rental homes in the capital.
Nina Bhatia, its executive director for strategy and commercial development, said: “Our partnership with abrdn is a major milestone in our ambition to create much-needed quality residential housing in our communities.
“Our residents can expect homes furnished by John Lewis with first-rate service and facilities.
“The move underlines our commitment to build on the strength of our brands to diversify beyond retail into areas where trust really matters.”
Joules secures Next rescue with majority of stores and jobs saved
Collapsed fashion retailer Joules will live on after Next agreed a rescue deal that preserves most of its stores and jobs.
Under the deal Next will pick up 100 of its 132 stores and only 133 of 1,600 staff will lose their jobs.
TFG, the owner of the Hobbs, Whistles and Phase Eight womenswear brands, appeared to be the frontrunner on Wednesday in an auction process to secure an agreement with Joules’ administrator, Interpath Advisory.
Joules is the second major UK acquisition for the fashion-to-homewares retailer in as many months.
Next snapped up the brand, website and intellectual property of Made.com on 9 November.
Joules had been trading as normal since a failure to secure new investment pushed it towards insolvency a fortnight ago.
The clothing, footwear and accessories retailer collapsed after its finances, profitability and cash generation came under pressure amid the cost of living crisis.
It had been in talks with both Next and TFG about new investment beforehand.
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