Haulage industry bosses have told MPs that the shortage of lorry drivers and resulting crisis in the supply chain is not improving despite measures introduced by the government to try and alleviate the problems.
Duncan Buchanan, director of policy at the Road Haulage Association, also strongly criticised the recently-announced 5,000 three-month visas for foreign drivers saying “if you were designing a visa system to fail, you would design it something like this”.
Image: Hospitality firms were said to be experiencing inflation of 14-18%
His warning came alongside others from recruitment and food services industry bosses appearing before the business, energy and industrial strategy select committee.
All three pointed to structural problems in the labour market which have contributed to the crisis.
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The Office for National Statistics published figures on Tuesday which show that HGV driver numbers have fallen by 53,000 over the past four years.
Nearly 50% of importing businesses have experienced changes in transportation costs as a result.
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Mr Buchanan told the select committee that “things are very challenged at the moment”.
“Things are not visibly getting better at this stage, and I know there are a number of measures that have been put in place, stepping up training, stepping tests, but on the ground that isn’t having much of an effect,” he added.
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Labour shortage squeezes food supply chain
The government has introduced a variety of measures to try and alleviate the problem including 5,000 three-month visas for non-UK drivers and training for 4,000 more British workers to become HGV drivers.
Mr Buchanan was particularly critical of the visa proposal saying a year would be more attractive to foreign workers.
“People aren’t sitting around doing nothing, waiting for visas to come up to go to a different country, work for three months, disrupt their lives, get stuck in the UK over Christmas,” he said.
Last week, plans were announced for a change to cabotage rules which govern how many deliveries foreign drivers can make in the UK within one trip.
It will mean they are allowed to make unlimited journeys within two weeks of arriving.
Mr Buchanan said this would have “zero impact” on alleviating the crisis and would serve to undermine the improving wages and conditions of British drivers.
He added however that people should not panic as most of these pressures were being felt by businesses and not being passed on to consumers.
These sentiments were echoed by the head of the Food and Drink Federation.
Image: An industry boss said changing cabotage rules would have zero impact on alleviating the crisis
Ian Wright said that while there is no shortage of food there have been problems with getting some products to the shelves.
He also warned that fixing these issues could take time.
“If I said it was going to go on forever, that would be ridiculous, but these issues are structural,” he said, adding that “if it is structural it will go on for quite a long time”.
He also said that he was particularly concerned with inflation and the fact that labour shortages could continue to push prices up.
“In hospitality, inflation is running between 14% and 18%, which is terrifying,” Mr Wright said.
Neil Carberry, chief executive of the Recruitment and Employment Confederation added that labour shortages in the UK are “uniquely sharp” compared with other countries and suggested that “snobbery” in policy-making has contributed.
He suggested that visa policy should be more focused on the workers that are needed, such as in haulage.
Downing Street said the supply chain crisis was discussed in Cabinet on Tuesday morning.
The prime minister reiterated that supply chain pressures are being experienced globally as the world emerges from the pandemic and that the UK is transitioning to a high wage, high productivity economy.
A government spokesperson said: “We have already taken immediate action to increase the supply of HGV drivers, streamline the testing process and improve working conditions.
“We will continue to work with the sector to alleviate the challenges facing the industry.”
An independent review of the water industry is to recommend sweeping changes to the way the sector is managed, including the potential replacement of Ofwat with a strengthened body combining economic and environmental regulation.
Former Bank of England governor Sir Jon Cunliffe will publish the findings of the Independent Water Commission on Monday, with stakeholders across the industry expecting significant changes to regulation to be at its heart.
The existing regulator Ofwat has been under fire from all sides in recent years amid rising public anger at levels of pollution and the financial management of water companies.
Campaigners and politicians have accused Ofwat of failing to hold water operators to account, while the companies complain that its focus on keeping bills down has prevented appropriate investment in infrastructure.
In an interim report, published in June, Sir Jon identified the presence of multiple regulators with overlapping responsibilities as a key issue facing the industry.
While Ofwat is the economic regulator, the Environment Agency has responsibility for setting pollution standards, alongside the Drinking Water Inspectorate.
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Sir Jon’s final report is expected to include a recommendation that the government consider a new regulator that combines Ofwat’s economic regulatory powers with the water-facing responsibilities currently managed by the EA.
In his interim report, Sir Jon said options for reform ranged from “rationalising” existing regulation to “fundamental, structural options for integrating regulatory remits and functions”.
He is understood to have discussed the implications of fundamental reform with senior figures in industry and government in the last week as he finalised his report.
Environment Secretary Steve Reed is expected to launch a consultation on the proposals following publication of the commission report.
The commission is also expected to recommend a “major shift” in the model of economic regulation, which currently relies on econometric modelling, to a supervisory approach that takes more account of individual company circumstances.
On Monday, the government’s long-awaited review into the UK’s water industry will finally report.
The expectation is that it will recommend sweeping changes – including the abolition of the regulator, Ofwat.
But frustrated customers of the water companies could rightly complain that the process of taking on this failing sector and its regulator has been slow and ineffective.
They may be forgiven for going further and suggesting that how Labour has dealt with water is symbolic of their inability to make an impact across many areas of public life, leaving many of their voters disappointed.
This is an industry that has been visibly and rapidly declining for decades, with the illegal sewage dumping and rotting pipes in stark contrast with the vast salaries and bonuses paid out to their executives.
It doesn’t take a review to see what’s gone wrong. Most informed members of the public could explain what has happened in a matter of minutes.
And yet, despite 14 years in opposition with plenty of time to put together a radical plan, a review is exactly what the government decided on before taking on Ofwat.
Month after month, they were asked if they believed the water industry regulator was fit for purpose despite the obvious disintegration on their watch. Every time the answer was ‘yes’.
As in so many areas of government, Labour, instead of acting, needed someone else to make the decision for them, meaning that it has taken over a year to come to the simple conclusion that the regulator is in fact, not fit for purpose.
As they enter their second year in office, maybe this can provide a lesson they desperately need to learn if they want to turn around their fortunes.
That bold decisions do not require months of review, endless consultations, or outside experts to endlessly analyse the problem.
They just need to get on with it. Voters will thank them.
Sir Jon has said the water industry requires long-term strategic planning and stability in order to make it attractive to “low-risk, low-return investors”.
The water industry has long complained that the current model, in which companies are benchmarked against a notional model operator, and penalised for failing to hit financial and environmental standards, risks a “doom loop”.
Thames Water, currently battling to complete an equity process to avoid falling into special administration, has said the imposition of huge fines for failing to meet pollution standards is one of the reasons it is in financial distress.
Publication of the Independent Commission report comes after the Environment Agency published figures showing that serious pollution incidents increased by 60% in 2024, and as Thames Water imposes a hosepipe ban on 15m customers.
Ofwat, Water UK and the Department for the Environment all declined to comment.
The first Post Office Capture conviction is to be sent to the Court of Appeal, Sky News understands, in a “breakthrough” moment in the IT scandal.
The Criminal Cases Review Commission (CCRC) has decided to refer the case of sub-postmistress Patricia Owen, who was convicted in 1998 of theft.
Mrs Owen was found guilty by a jury based on evidence from the faulty IT software Capture, which was used in 2,500 branches between 1992 and 1999, before the Horizon Post Office scandal.
Image: Pat Owen, pictured here with her husband David, always maintained her innocence but died in 2003 with a criminal record
It comes after Sky News revealed that a damning report into Capture, which could help overturn criminal convictions, had been unearthed after nearly 30 years.
The decision to refer the first-ever Capture case to the Court of Appeal has been made on the grounds that Mrs Owen’s prosecution was an “abuse of process”.
The development has been described by victims’ lawyer Neil Hudgell as “hugely pivotal”.
“The Court of Appeal don’t receive that many referrals that start at the CCRC, and most get turned away, so it’s a very high bar to even get cases from the CCRC to the Court of Appeal…”
“I think it will be a real shot in the arm to all the other Capture victims who are waiting for their cases to be determined by the CCRC.”
Mr Hudgell described the report found earlier this year – written by computer experts in 1998 and highly critical of Capture – as “significantly tipping the balance”.
Image: Lawyer Neil Hudgell says development is ‘hugely pivotal’
Sky News found that the Post Office knew about the report at the time and continued to prosecute sub-postmasters based on Capture evidence.
Pat Owen always maintained her innocence but died in 2003 with a criminal record before the wider Post Office scandal came to light.
Her daughter Juliet Shardlow said she cried when she heard the news that her mother’s case would be referred to the Court of Appeal.
“I feel angry that she is not here because she died before her time… we will be there – we will be sitting there in that front row.
“I can’t put it into words because it’s still all a shock that we are where we are and that later this year, or next year, we might have what we set out to get… justice for her.”
Image: Juliet Shardlow is seeking justice for her mother
The CCRC is currently investigating 30 cases potentially related to the Capture software system.
Twenty-seven of those cases are now assigned to case review managers and under “active review”, with a further three cases in the preparatory stages.
The CCRC has described a “challenge” over determining “whether cases involved the use of Capture at the time of the alleged offences”.
In a letter written to Liam Byrne, chair of the Business and Trade Committee, and seen by Sky News, it said that information the Post Office has provided “does not, in most cases, show whether it was installed and in operation at the time of the alleged offending”.
It also mentioned that the Post Office is reviewing “a significant amount of data which may contain further information”.
A Post Office spokesperson said: “While it is not appropriate for us to comment on specific cases, we have been very concerned about the reported problems relating to the use of the Capture software, and we are sincerely sorry for past failings that have caused suffering to postmasters.
“We are determined that past wrongs are put right and continue to support the government’s work in this area as well as fully co-operate with the Criminal Cases Review Commission.”
The number of most serious water pollution incidents rose by 60% last year, according to data covering England, with three companies responsible for the bulk of them.
The Environment Agency (EA) – under fire for its own oversight of water firms’ pollution performance – said that more than 80% of the 75 instances of pollution in its two most serious categories were the responsibility of Thames Water (33), Southern Water (15) and Yorkshire Water (13).
But the body added it had found “consistently poor performance” across all nine water and wastewater firms in the country – a similar summary to that of 2023.
According to the report, reasons behind the 2024 results included persistent underinvestment in new infrastructure, poor asset maintenance, and reduced resilience due to the impacts of climate change.
The period was dominated by spells of intense rainfall, which overwhelmed storm overflows and resulted in sewage discharges.
The EA reported 2,801 pollution incidents in total during 2024 – a hike of almost a third.
The data was released as a committee of MPs called for regulation of water companies to face a “complete overhaul” amid a lack of public trust and anger over surging bills to pay for long overdue infrastructure improvements.
The Public Accounts Committee said that Ofwat and the EA had failed to secure industry compliance and warned that even the high bill settlements to 2030 would only result in 44% of sewage overflows being overhauled.
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‘Paddle-out’ protest against water pollution
The Independent Water Commission, established by the government last year and led by former Bank of England deputy governor Sir Jon Cunliffe, is due to make final recommendations on the regulatory framework next week.
He warned when the interim report was published last month: “There is no simple, single change, no matter how radical, that will deliver the fundamental reset that is needed for the water sector.”
Alan Lovell, the EA’s chair, said: “This report demonstrates continued systemic failure by some companies to meet their environmental targets.
“The water industry must act urgently to prevent pollution from occurring and to respond rapidly when it does.
“We have made significant changes to tighten our regulation of the water industry and ensure companies are held to account.
“With a dedicated larger workforce and increased funding, our officers are uncovering and acting on failures to comply with environmental law.”
A spokesperson for industry group Water UK responded: “While there have been some improvements it is clear that the performance of some companies is not good enough. The Environment Agency is right to highlight underinvestment in infrastructure and maintenance as the major causes of these results.
“Investment in the sector has been suppressed with Ofwat prioritising short -term cuts to people’s water bills over the long-term resilience of the network. This is finally being put right, with a record £104bn investment over the next 5-years to secure our water supplies, support economic growth and end sewage entering our rivers and seas.
“However, fundamental change to regulation is also needed. We hope that the recommendations of the Independent Water Commission next week will ensure the sector continues to get the investment it needs to drive down pollution incidents.”