The sector skills council hopes the scheme will help tackle the looming driver shortage facing the industry (CM 17 May) by allowing more people access to funding to meet the costs of obtaining an LGV driver’s licence.
Ross Maloney, director of intelligence and strategy at SfL, says: “The [most frequent] call we get into our office is people looking for LGV driver training funding.”
Although funding for traditional academic qualifications is available via student or professional development loans, potential LGV drivers have no option other than private bank loans, and banks are often reluctant to lend in the current economic climate, he says.
SfL’s credit union would be not-for-profit, Financial Services Authority-approved and run by the Co-op. Members would contribute some form of capital, for example employees might have their wages paid into the scheme.
However, unlike a bank any profit generated by the scheme would not go to shareholders, but instead create a “pool of liquidity”. This could then be accessed by employees for any training or skills development they require. “Effectively, you are borrowing against your future earnings,” says Maloney.
Employers’ involvement could be as simple as placing their payroll costs through the credit union, or investing any surplus working capital into the scheme as loan funding.”We have a market failure: we have a shortage of drivers, everybody knows it, but what are we doing about it?” says Maloney.