true, and if i wanted to add another two wagons to my o’license tommorow, i’d have no problems at all 
i’m not telling anyone how to go about running their business but to make a statement a sticky that implies that the amounts your required to show as available when first applying for an o’license have to remain in your bank account untouched for the entire period your in business is not only misleading, it’s incorrect and might well put someone off from starting up.
spaceman:
Big Joe:
The other option is to arrange an overdraft facility with a bank to cover the start up financial requirment, you don’t have to use it, but the bank will charge an annual arrangement fee to keep it activated.Big Joe - yup, overdrafts are accepted. But note the financial requirement is not just for start up - it applies throughout the life of the licence.
If the business is in a position to be able to go to the bank and be able to obtain an overdraft at any time to satisfy the financial requirement, there is no need to have the money sitting around, and the financial requirement can then be met if requested, also it saves £100-£200 per year in arrangement fees.
Big Joe:
spaceman:
Big Joe:
The other option is to arrange an overdraft facility with a bank to cover the start up financial requirment, you don’t have to use it, but the bank will charge an annual arrangement fee to keep it activated.Big Joe - yup, overdrafts are accepted. But note the financial requirement is not just for start up - it applies throughout the life of the licence.
If the business is in a position to be able to go to the bank and be able to obtain an overdraft at any time to satisfy the financial requirement, there is no need to have the money sitting around, and the financial requirement can then be met if requested, also it saves £100-£200 per year in arrangement fees.
I don’t think that cuts the mustard.
You have to meet the financial requirement at all times.
So that’s an average balance in a three month period.
I think they’ll smell a rat if an overdraft appears after they have asked for your financial proof. Maybe they would then look to see if you met the requirement six months or two years ago?
If you have to meet £6,200, but say you only show £5,000 for 15 days, you will need to show £7,400 for 15 days (at some time in the 3 mth period) to get back to the average of £6,200.
paul b:
true, and if i wanted to add another two wagons to my o’license tommorow, i’d have no problems at all
Me neither, other than the thought of advertising and reapplying is a bit sickening 
i’m not telling anyone how to go about running their business but to make a statement a sticky that implies that the amounts your required to show as available when first applying for an o’license have to remain in your bank account untouched for the entire period your in business is not only misleading, it’s incorrect and might well put someone off from starting up
True.
But how many people think/thought you only have to meet it at start up? Maybe that’s reason enough?
I’m not suggesting meddling in anyone’s business or deterring a new start-up, but I do believe in this idea of a level playing field for all. Is breaching this requirement any different to someone playing Frisbee with tachos or running on red diesel?
spaceman:
You have to meet the financial requirement at all times.So that’s an average balance in a three month period.
I think they’ll smell a rat if an overdraft appears after they have asked for your financial proof. Maybe they would then look to see if you met the requirement six months or two years ago?
If you have to meet £6,200, but say you only show £5,000 for 15 days, you will need to show £7,400 for 15 days (at some time in the 3 mth period) to get back to the average of £6,200.
I don’t think I’ve ever read such a load of [zb]ks, a couple of years ago I had a weak moment and decided I might expand and put another truck on the road 
so made enquiries with the traffic area office about increasing the margin to allow some expansion, and I was told that a letter from the bank with an offer of an overdraft facility to cover the financial requirement would be perfectly acceptable towards an application.
The Traffic Commissioners make take some severe decisions (rightly so in the majority of cases), but give them some credit, even they realise as long as a business can meet the financial requirement when asked to, theres no problem. Even they realise no business can afford to have several thousand pounds of money per truck lying around, nor will a business pay hundreds of pounds per year for an multi thousand pound overdraft facility that won’t be used.
When a business is asked for financial info, its usually of a result of some poor maintainance problem brought to the attention of the commissioner, the first thing to suffer when a business is under financial pressure.
spaceman:
I’m not suggesting meddling in anyone’s business or deterring a new start-up, but I do believe in this idea of a level playing field for all. Is breaching this requirement any different to someone playing Frisbee with tachos or running on red diesel?
so a one man band sets up, after a few months he has a bit of bad luck which forces him into using his backup money which he replaces over the next couple of months by grafting because he doesnt want to put his business in debt? that puts that bloke in the same bracket as people who flout the tacho laws and run on red?
you can’t be serious?
Big Joe:
I don’t think I’ve ever read such a load of [zb]ks, a couple of years ago I had a weak moment and decided I might expand and put another truck on the road
Increasing the margin. In which case you would have to advertise and apply for a major change, including proving the financial requirement.
“The average balance over this period will be calculated, and added to any overdraft or credit facility demonstrated by a formal written commitment by the bank”
So why is that [zb]ks 
paul b:
so a one man band sets up, after a few months he has a bit of bad luck which forces him into using his backup money which he replaces over the next couple of months by grafting because he doesnt want to put his business in debt? that puts that bloke in the same bracket as people who flout the tacho laws and run on red?
you can’t be serious?
So you can pick and choose which rules apply?
Lets say two operators doing identical work “have a bit of bad luck”.
Op1 ignores the average financial requirement.
Op2 runs down the bank and secures extra funds to see him through. This incurs an overdraft fee. But by doing so he meets the conditions of his licence.
Op2 now has higher operating costs than Op1.
So why is that any different to someone increasing their profit by driving over hours, or running on red?
spaceman:
“The average balance over this period will be calculated, and added to any overdraft or credit facility demonstrated by a formal written commitment by the bank”So why is that [zb]ks
Because an offer is not a facility that is actually in place, do you really think the Commissioner expects the likes of Irlams, Stobarts, Excel et all to have millions of £’s sitting in a building society account just in case several hundred trucks on the fleet suddenly need £3000 spending on them, get real 
… Stobarts recent problem with the Commissioner was due to the fact that they could’nt demonstrate they had the financial backing required, e.g. their Bank would’nt offer them a facility to cover the full requirement. If the Commissioner was really serious about the financial requirement, the easy way to ensure that everyone complied would be to demand that a bond be deposited with the Dep of Trade and Industries or similar, but according to you if you touched that money, then you get shafted by the commissioner.
With such a pedantic outlook, a promising career in H&S beckons you my friend. 
Big Joe:
With such a pedantic outlook, a promising career in H&S beckons you my friend.
I’m not taking sides here ('cos I don’t know the answer 
) but that is a funny comment!! 
spaceman:
paul b:
so a one man band sets up, after a few months he has a bit of bad luck which forces him into using his backup money which he replaces over the next couple of months by grafting because he doesnt want to put his business in debt? that puts that bloke in the same bracket as people who flout the tacho laws and run on red?
you can’t be serious?So you can pick and choose which rules apply?
Lets say two operators doing identical work “have a bit of bad luck”.
Op1 ignores the average financial requirement.
Op2 runs down the bank and secures extra funds to see him through. This incurs an overdraft fee. But by doing so he meets the conditions of his licence.
Op2 now has higher operating costs than Op1.
So why is that any different to someone increasing their profit by driving over hours, or running on red?
but op1 has used an overdraft facility when setting up, he’s in his first year, do you really think his bank will give him an overdraft on his overdraft?
i don’t know how you set up when you started but it would seem to your way of thinking the only operators who are doing it legit are those who lumped a bin full of money, that they just happened to have lying around into their business from day one, an overdraft as anyone who’s dealt with any bank will tell you has it’s limits, a loan would obviously put you continually in the red and run the risk of loosing your o’license ( in your interpretation) as on paper your insolvent!
perhaps you colud outline a business plan for any wouldbe operators that you deem as the right way to go?
paul b:
but op1 has used an overdraft facility when setting up, he’s in his first year, do you really think his bank will give him an overdraft on his overdraft?
Yes, if the bank thinks the business can trade out.
No, if the bank thinks the business isn’t viable.
My example was like for like, comparing apples with apples. You’ve bowled in an orange.
paul b:
… it would seem to your way of thinking the only operators who are doing it legit are those who lumped a bin full of money, that they just happened to have lying around into their business from day one
legit = (my way of thinking, among other things) meeting the obligations of your O’Licence.
I believe this is a continuing requirement, you don’t. I believe the funds needs to be available from somewhere, whether its cash, credit or whatever the TC agrees in specific cases. It’s a statutory obligation — not an option.
paul b:
… a loan would obviously put you continually in the red and run the risk of loosing your o’license ( in your interpretation) as on paper your insolvent!
Depends on the terms/length of the loan whether it goes above or below the line. One affects your [solvency] ratios, the other is classed as equity.
paul b:
perhaps you colud outline a business plan for any wouldbe operators that you deem as the right way to go?
Yes and No. Knocking up a few spreadsheets from estimated income, expenditure and capital expenditure isn’t too difficult. Then realisation might hit in……
I don’t think there is such a thing as a “model” plan. As I said before, “just” meeting the financial requirement before you’ve bought a truck, insurance, etc wouldn’t look overly favourable in a typical “I want to become an owner driver, what do I need to do” situation.
Another link — take a look at the TC cases under Financial Standing
These are cases that have gone to appeal/tribunal, usually after the TC’s decision at public enquiry.
Are going to have a sticky for would be owner drivers?