Great Britain
This article was added by the user Anna. TheWorldNews is not responsible for the content of the platform.

The REAL reason for the HGV driver shortage - and why Rishi Sunak should be worried

HGV driver tells Nick Ferrari about failed HMRC system

Perhaps you've been stuck in your car with the fuel light on an hours-long queue at the petrol station to refill, or your favourite pub has run out of beer. Or maybe your local supermarket has sold out of turkeys in a mad dash to secure Christmas dinner, and the McDonald's is out of your favourite milkshake. Whatever the case, chances are you've noticed the effects of the HGV driver shortage in the UK, as supply chains tumble further into crisis without the manpower to deliver essential items.

The shortage has been blamed on many things, from Brexit to the coronavirus pandemic.

But a clearer picture is beginning to emerge, and Chancellor Rishi Sunak is in the hot seat.

A change in tax laws has seen some drivers losing as much as 25 percent in earnings, sending personnel flocking to other jobs to stay afloat.

The tax code - called IRR35 - has been drastically altered, affecting how people working off the payroll pay their taxes.

READ MORE:  Tax code changes influenced lorry driver crisis

HGV driver shortage

HGV driver shortage: Why Rishi Sunak is to blame (Image: GETTY)

HGV driver shortage

HGV driver shortage: A look at plummeting numbers (Image: EXPRESS)

The reforms were designed to prevent workers from setting up limited companies through which they pay less tax and National Insurance while working, in effect, as an employee, but has backfired spectacularly.

The change in employment status for many HGV drivers from self-employed to employed has led to huge cuts in earnings.

Neil O'Brien, director of D&D Recruit, an agency that specialises in staffing up big names like FedEx and UPS, told Express.co.uk the changes meant drivers "took home less money for the same work".

Mr O'Brien conceded that compounding factors of Brexit, the pandemic, poor working conditions and low pay led to the crisis.

HGV driver shortage

HGV driver shortage: Drivers face hours-long queues to fill up on fuel (Image: GETTY)

He said: "There is a decline in the number of drivers gradually as it is not seen as an attractive career - poor working rights, conditions and pay being the main factors."

He said the sudden decline in drivers over the summer is down to IR35 changes, "which reduced the net payments to drivers".

Many of these drivers were European, he said, and with Brexit and the tax changes, they opted to head home instead.

Mr O'Brien said: "European drivers could earn more in Europe, so they chose to work there, rather than in the UK."

DON'T MISS: 
Retailers 'pulling out all the stops' to meet demand [LATEST]
US fears Christmas cancelled over container ship build up [FORECAST]
China supply chain problems may spark disruption to UK this Christmas [INSIGHT]

Steve Finlay, who has been in transport his whole life, told i: “I work for one of the biggest truck companies in the Northeast. Up until recently, the drivers who were driving Monday to Friday were on £10 an hour.

Another driver, David Foster, said: "I work for a company that lost at least 250 drivers due to the tax changes.

"If you’re self-employed you’re making £1,300 a week, when you’re classed as an employee your down to £650-700 a week, which is a massive reduction.

HGV driver shortage

HGV driver shortage: Empty shelves have been seen in supermarkets across the UK (Image: EXPRESS)

"European drivers have come in because of freedom of movement and now they’ve all gone back home because of this."

In response to claims of IR35 issues, HMRC said: "The off-payroll working rules were designed to ensure individuals pay similar levels of tax regardless of the structure they work through. The changes in April 2021 do not introduce a new liability. They ensure the rules, which have been in place since 2000, are applied as intended.

"HMRC has offered extensive education and support to those implementing the changes, including tailored content to help the haulage and transport sector to comply. We proactively worked with transport industry representative bodies to understand their concerns and offered additional support to help with the understanding and implementation of the rules.

"We have also worked with cross-government partners to deliver an off-payroll webinar attended by over 40 industry representatives.”