The trucking industry is the backbone that connects manufacturers, suppliers, and consumers. Yet, this reliance brings with it a complex web of responsibilities and risks that all parties in the supply chain must confront.
In the past six months, in response to a call to action from our members, the Queensland Trucking Association (QTA), in collaboration with other industry associations, has actively presented the issue of unfair contracting practices to the government, advocating for a level playing field for the road freight industry.
The intention is to address tax aversion and employee employment conditions that are being used to dramatically undercut freight costs, ultimately jeopardising the sustainability and integrity of the sector.
Senator Glenn Sterle is to be commended as a singular voice actively supporting the industry to raise the profile of this issue at a Federal level.
It is clear however, that the authorities are not prioritising the concerning impact of losing numerous transport businesses and the long-term consequences this will have on the ability to service the freight task in Australia safely and fairly. Without sufficient diversity in fleets, the industry risks becoming overly reliant on a handful of operators, which can hinder competition and innovation. This lack of diversity may lead to increased costs, reduced service quality, and diminished safety standards, as fewer players are left to meet the growing demands of freight transport.
Ultimately, a homogeneous fleet composition undermines the industry’s resilience and jeopardises the fairness and sustainability of the services provided, impacting not only businesses but also consumers across the country. it is imperative to elevate the conversation around the risks associated with insufficient insurance, workers compensation, vehicle maintenance and adequate training of drivers on the road.
What’s the state of play?
In an era where efficiency and speed define success in the logistics and transport sector, we know in Australia, businesses increasingly depend on trucking companies to facilitate the movement of goods.
While the allure of lower costs may seem appealing, the ramifications may be inverse to your intentions. Whether you are the freight customer or the prime contractor sub-contracting out work, consider the implications of entrusting your freight to a trucking contractor whose vehicles and drivers lack adequate insurance and workers compensation coverage. Inadequate insurance coverage is a threat throughout the supply chain, bringing financial instability, reputational risk and unrestrained personal risk.
Moreover, the issue of driver protection cannot be overstated. Drivers are the vital link and face of your logistics operations, and ensuring their health and safety should be a priority for every business engaged with trucking companies.
When drivers lack proper coverage for work-related injuries, the consequences ripple through the supply chain. Unprotected drivers may suffer from avoidable financial hardships, which can lead to diminished morale and engagement. A distressed workforce cannot deliver the excellence that your customers expect, and it can create an environment where safety protocols are overlooked in the pursuit of completing deliveries under pressure.
Fair compensation and working conditions are not just ethical imperatives; they are foundational to creating a safe and reliable workforce. The federal government has recently legislated in the supermarket sector for what is effectively reasonable cost recovery plus a fair margin. Seems reasonable!
Industry’s urgent call
On behalf of road freight transport companies, we are strongly urging supply chain customers to fully understand the implications of procurement decisions. It is imperative that you conduct thorough due diligence and closely scrutinise price variances in tenders, rather than simply settling for the cheapest.
We are aware cost considerations are important, but the long-term survival and sustainability of your business will depend on building relationships with trusted, reputable, and safe transport providers.
By prioritising freight partners who meet high standards of safety and lawful employment practices, you not only protect your own interests but also play a crucial role in upholding the integrity of the entire supply chain. It’s time to take a stand for quality and safety in our industry – your choices matter!
If you are cutting corners, are you preparing a scenario for the next accident?
The conversation around trucking is not just about cost or efficiency; it encompasses broader themes of safety, ethics, and social responsibility. By taking the time to consider these factors, businesses can forge relationships with trucking partners that align with their values. This is more than a contractual obligation—it’s a commitment to integrity that reverberates through every facet of the supply chain.
Misguided approach to the problem
The road freight transport industry is at a pivotal crossroads, grappling with a troubling rise in insolvencies that warrants immediate attention.
The alarming frequency of companies collapsing this year highlights a deeper issue within the industry—one that is often overshadowed by an overemphasis on increasing compliance and on-road safety regulations.
While it is undoubtedly crucial to enhance safety measures, focusing solely on compliance overlooks the root causes driving these failures. As businesses demand lower prices and higher service levels, the economic viability of transport providers is compromised, leading to unsustainable practices that ultimately jeopardise safety.
I encourage you all to read this Big Rigs article.
In relation to the proposed Heavy Vehicle National Law changes to accreditation standards, there are those who defend them “nothing to see here.” Opinions may vary, but the tables have shifted directly to personal director liability by asked to report how much you spent on safety in your fleet, and all material gathered in the accreditation process being available to prosecute directors.
The broader strategy appears to make circumstances harder for those who participate. Meanwhile, the fabric of the supply chain is being shredded by businesses who are unlawfully engaging drivers on ABNs, and it would appear clients are willing to accept the boundless risks that brings.
It is essential for stakeholders to urgently shift their attention from merely enforcing standards to understanding the interconnected factors threatening the industry’s foundation.
Who is going to step up and truly paying attention to this urgent call for introspection and action?
This year offers every opportunity and the QTA on behalf of our members, will continue to advocate with clarity and certainty for the attention of authorities on the real causal factors of the diminishing sustainability of the supply chain.
- Gary Mahon is the CEO of the Queensland Trucking Association.
I totally agree, 100%.
The problem in this industry is the biggest you are the more you get cheaper. Toll linfox cube centurion all pay half for fuel compared to everyone else if fuel suppliers can sell to them at that price everyone else should get the same deal. Also the important drivers and companies they pay them less and they are not up to the standards of Australian drivers and that shows in the amount of accidents and truck fires maintaining vehicles is not their priority and i have seen it time and time again. The industry needs a big shake up it should be a level playing feild for all involved and big fines should be given for people caught undercutting. There should be a set minimum rate for all transport no exceptions so everyone can make a profit owners drivers all involved