Government mulls ways to help smaller hauliers struggling to access COVID-19 funding packages

The government is looking at alternative means of funding smaller hauliers struggling to access the Treasury’s COVID-19 funding packages.

It also wants to “reverse” extended payment terms that some clients have put in place since the arrival of the Coronavirus pandemic.

The strategies were revealed today (7 April) during a House of Commons Transport Committee hearing into the impact of the COVID-19 pandemic on the transport sector.

Lincoln MP Karl McCartney raised concerns about the plight of hauliers who are struggling to gain access to Treasury funding, warning that many smaller haulage companies were in danger of falling into difficulties if the situation “goes on for much longer".

McCartney asked DfT under-secretary Baroness Vere of Norbiton what measures the government is taking to help these businesses.

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Vere said: “The haulage sector has suffered a significant drop in revenues and we are well aware of that.

“Compounding that is a pressure on working capital. Some companies that use hauliers have been extending their payment terms and we are looking to reverse that where we can, but also on the cost side, some suppliers to the haulage sector are also demanding payment sooner.

“We are thinking about what we can do for the haulage sector – as you will appreciate it is incredibly complex - it is, in reality, a huge number of sub-sectors, all serving different markets, carrying different goods, using different vehicles and working in different environments.

“My officials are working very hard looking at the sort of support that might be offered, if it is the case that haulage companies cannot access the support that is already being provided by the Treasury - so it is a work in progress and we are well aware of the issue.”

Responding, Rod McKenzie, RHA policy and public affairs MD, told motortransport.co.uk: "Many smaller hauliers are struggling for access money to support their businesses - they have low margins and poor cash flow. The government is promising jam tomorrow when these firms need jam now."

He added: "The government must not be seen to be hindering the very businesses that keep Britain's supermarkets and hospitals supplied."

The DfT's move to help hauliers weather the impact of the pandemic comes in the same week that the FTA called on the government to “urgently” clarify when and how quickly furlough payments will be made to logistics firms, warning that firms furloughing workers are “fast running out of cash” as the COVID-19 pandemic continues.