Road hauliers might need to show greater financial reserves to continue operating in the UK, according to the Freight Transport Association (FTA).

Financial standing requirements are reassessed according to the exchange rate every October, with new requirements taking affect from the following January.

Although the Department for Transport hasn’t yet announced the new figures, the FTA anticipates that, following Brexit, the sums will change from £6,650 to around £7,800 for the first vehicle, and from £3,700 to around £4,300 for each subsequent vehicle.

Ed Shepherd, head of member advice at the FTA said, ‘The potential hike may create difficulties for hauliers as they now need to demonstrate to the Traffic Commissioners, the industry regulator, that they have over 15% greater reserves available.

‘The financial standing requirements exist to demonstrate to the Traffic Commissioner that a commercial vehicle operation is solvent, and ostensibly to show that they don’t need to start cutting corners in vehicle maintenance and safety in order to save costs.’

Financial standing is not a sum that has to be paid, but rather an indication that a business has such reserves readily and easily available.

Ed continued, ‘The increase would come as a sudden shock to operators who will need to demonstrate these extra reserves by the New Year. While ‘cash at the bank’ is the most straightforward way of demonstrating compliance, other methods permitted by the Traffic Commissioners include joint and several guarantees, overdraft facilities, credit facilities and invoice finance agreements.’