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Millbrook 2019
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February 27 2019
By Martin Dean

The Confederation of Passenger Transport (CPT) President for 2019, Martin Dean has been Managing Director of Bus Development of Go-Ahead Group PLC since July 2008.

He leads and acts as a focal point for all bus development activity throughout Go-Ahead Group, assists with the development of bus policy and strategy and provides additional group resources for its bus companies.

He joined Go-Ahead in 2008 from First Group, where he was Business Development Director of the UK Bus Division, and served as its Project Director for Commercial.

He held roles at National Express. Mr Dean began his career with London Transport.

Will Brexit amplify the driver crisis?

With freedom of movement likely to be restricted due to Brexit, the coach and bus industry is at risk

Those of us who have spent a lot of our careers in coach and bus in employment ‘hot spots’ will remember the years before EU freedom of movement with great trepidation. A lot of our plans for expansion were not predicated on market trends or service elasticities but the simple question ‘if we tried this out would we be able to staff it?’.

Brexit poses a threat to ‘low skill’ work

Given that the answer was often a flat ‘no’ or ‘can’t be sure’, the fallback position was often to retrench into simply trying to preserve the current operation rather than the risk of ‘over expanding’ and encountering the dreaded staff shortages.

This has never been completely solved but at least freedom of movement gave us a reservoir of labour to tap into and, on the whole, this has been a success story for the industry.

Brexit restrictions

Regardless of what any of us think about Brexit, overall the likely restrictions on freedom of movement are likely to be a major risk to the industry.

This is confirmed by the White Paper on Immigration which is currently out for consultation and proposes a threshold of £30,000 annual salary below which EU nationals will not be allowed to work in the UK for what is rather disparagingly termed ‘low skill’ work.

The White Paper proposed this will be implemented in 2021 to parallel the two-year transition period but of course if we have a no deal Brexit, freedom of movement would cease immediately.

Economy damage

Soundings from inside government suggest that pro-business ministers argued hard for the threshold to be much lower (£21,000) because they were aware of the damage the higher threshold was likely to do to the UK economy. This was resisted because Theresa May is so insistent from a political angle on reducing levels of immigration.

Office of National Statistics figures show there were 2.28m non-UK EU nationals working in the UK in June 2018 – 86,000 less than a year earlier which represented the biggest annual fall since comparable records began in 1997. Workers are returning home which has always happened, but they are not being replaced by a new wave.

What to do

The Institute of Directors has already calculated that the £30,000 threshold could affect 60% of jobs at what they term ‘intermediate skill levels’ so it is not something that can be ignored. Tactically it makes sense for all operators to carry out some analyses just to understand how sensitive existing operations are to an acceleration of current trends.

Strategically, I would recommend we all engage in the White Paper consultation. Due to the last 12 months (except in the case of a no-deal Brexit) we need to make it clear the damage such a policy will do, not only having implications on the ability of our sector to grow but also in being able to respond to important public policy objectives such as air quality improvement.

Full automation in mixed traffic is a long way off and the industry will be labour intensive for a long time to come.

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