Examination of Witnesses (Questions 14380
- 14399)
14380. I am not suggesting for one moment that
freight is not a very important part of the economy but it is
one of a number of interests which have to be balanced and the
way that will be balanced is through the negotiation of the access
option with the supervision of the independent regulator. A balance
between those interests will be struck in that access option and
that access option will also, as I indicated in re-examination
of Mr Watson on Tuesday, have the ability to fit pre-conditions
for infrastructure enhancement.
14381. Issues as to capacity we have dealt with
through our evidence. Lord Berkeley and his group may disagree
with the assessment of capacity and the fact that they consider
that capacity still exists on the Great Eastern side absent Crossrail.
However, that is not a view which is shared by the Timetable Working
Group, which has representatives of both the private sector and
the public sector. Could I have put up, please, Lord Berkeley's
slide A163?[11]
Lord Berkeley has helpfully given you as figure 1 of his evidence
the operators' market share. Representation exists on the Timetable
Working Group from Freightliner Group, which is both Freightliner
companies, EWS and GB Railfreight, and over 90% of that market
is represented on the Timetable Working Group, so to suggest that
the freight market does not have representation on the Timetable
Working Group just does not hold water in my respectful submission.
14382. So far as others are concerned, if Lord
Berkeley or Tarmac or someone else is arguing for specific representation
then, as the report itself says, the meetings have agreed it has
got to be manageable. The industry, of course, is consulted but
the industry is also represented at present through those who
already sit on the TWG. No doubt those matters and that membership
will be reviewed as time progresses but they are consulted, they
are asked their views. They will also have their input through
the negotiations over the access option when they can make their
representations to Network Rail and to the independent regulator.
The suggestion that somehow the freight industry is shut out of
this process is palpably wrong in my submission. Clearly it is
proper that it be involved and it is involved. As I say, Lord
Berkeley's group may take the view that there is sufficient capacity
and it is Crossrail that causes problems to the Great Eastern.
That is not the view which the TWG has reached and if I might
remind you it is page 7 of the Working Group report. It is exhibit
P106, page 8, under the heading "Freight Services" which
we went through on Tuesday.[12]
Lord Berkeley's view is, of course, a legitimate view no doubt
but it is not one that is shared by the group with all those elements
of representation.
14383. Paragraph 41 of Lord Berkeley's paper
this afternoon says: "The logical process is to complete
a robust timetable, include it in an access option paper, and
then withdraw the offending clauses... ". As I have already
said, that is the plan. The plan, as Mr Twigg's letter makes clear,
is to complete the timetable of work, negotiate the access options
and then to review the Bill powers, so what we are doing seems
in my respectful submission to comply with the essential thrust
of what Lord Berkeley is urging on the Committee.
14384. Finally, I simply remind the Committee
again that we are seeking to use the processes which Lord Berkeley
says we should use but we do have to protect the very real interests
of an infrastructure project which a wide sector of the community
and the business sector supports. The public interest does not
merely lie in protection of freight interests but also of balancing
the various interests together. Parliament has taken a key step
in that direction by approving on Second Reading the Bill. The
public interest is therefore undisputed and in my respectful submission
the processes which are in train now more than adequately meet
the complaints of the Petitioner. Thank you very much.
14385. Lord Berkeley: I am very grateful
for those comments. I disagree about the timetabling. I think
the timetabling will probably feature quite a lot in the next
fortnight. I am not going to come back although I disagree with
it at the moment. In respect of the letter from the Department
for Transport on 29 June, yes, he says he is going to follow the
process which I have outlined but he is only going to follow it
as long as he gets his own way.[13]
It is subject to Government agreeing that the outcome is satisfactory
for all those people who support Crossrail. My argument is that
that is fine if there is a genuine discussion but just because
there are a lot of people supporting Crossrail it does not mean
to say that the rights of other interests, freight interests,
should not be taken into account. Why should they be worsened
because Crossrail comes along? We are not saying that we are against
Crossrail. All we are saying is that if Crossrail is taking capacity
away Crossrail should provide it so that freight is in no worse
a state than it would have been without Crossrail. That is my
main argument. Thank you, Chairman.
14386. Chairman: That concludes the petition.
We will now move on to the next petition, which is that of the
Freight Transport Association Ltd, Dr Andrew Traill.
The Petition of the Freight Transport Association
Limited.
Dr Andrew Traill appeared on behalf of the Petitioner.
14387. Dr Traill: I do not hold with
titles.
14388. Chairman: I tend to refrain from
titles. We will call you Andrew. Are you dealing with this, Mr
Elvin?
14389. Mr Elvin: I am, sir. Dr Traill
for the Freight Transport Association is raising similar points
to the last Petitioner so I do not need to say any more.
14390. Chairman: Thank you.
14391. Dr Traill: Well, my name is Dr
Andrew Traill and I am the Freight Transport Association's Head
of Rail Freight, Maritime and Air Cargo policy. For the record,
I have been with FTA for nearly 12 years and mostly in that time
I have been representing the interests of what we call British
shippers, those that actually purchase freight transport services
by all modes for national, domestic movement of goods as well
as the international movement of goods. I have a particular responsibility
within FTA for running its Rail Freight Council. That is a forum
of rail freight operators, all members of course, other rail freight
service providers and rail freight customers. I have been representing
FTA members' interests in the Crossrail issue and have been involved
in the Crossrail stakeholder meetings chaired by the Minister
for Transport, Derek Twigg.
14392. A little bit about FTA itself.[14]
We have some 12,500 companies in membership, all involved somehow
in the movement of freight within the United Kingdom and internationally.
These include road haulage and logistics companies, express parcel
operators, rail freight companies, port and terminal operators
and, significantly, the freight transport customer. Those are
retailers, manufacturers, wholesalers and even I would categorise
here freight forwarders.
14393. The interests of the freight transport
customer lie at the heart of all our policies and our activities,
whether we are considering issues relating to road freight transport,
air, sea or rail freight issues.
14394. The origins of FTA go back over 100 years
and lay in a group of entrepreneurial businessmen who believed
then that a group representing their collective interests was
needed to counter the apparent collusion of the railway companies
of the day. Whilst road freight has now become the most significant
element of logistics today, FTA still claims to represent the
interests of companies accounting for 90% of all UK rail freight
traffic.
14395. It is with some authority that FTA can
therefore speak on rail freight issues as they impact the customers
in particular. In the course of this presentation to the Committee
I plan to cover off these following issues: the perception of
rail freight to industry; the value of rail freight to industry;
the importance of business confidence in the rail freight future.
Here, having established the background to our concerns, I will
cover the threats that we see from the Crossrail Bill in its current
form, and that includes the issue of road congestion and we will
end with some solutions to propose to the Committee and some brief
conclusions.
14396. Before I delve into the particulars of
our concerns over the present Crossrail Bill, it is important
we feel that the Committee hears the context into which our objections
fit, and hence the first three items on this list.
14397. The customer is concerned about two things
above all others: the service and the price of the service. For
a number of years, the rail freight industry has suffered from
a perception of under-performance and high prices compared to
the principal alternative mode of transport, road freight services.
Much of this perception has had its origins in previous years
of neglect of the railways, a poor focus on customer requirements,
and the experiences of freight transport buyers that were, in
fact, founded on their own experiences and those represented by
the media, of passenger rail services, not freight.
14398. Four years ago FTA conducted a survey
of rail freight customers and potential customers to ascertain
a more precise picture of perceptions about rail freight and where
the industry needed to concentrate its efforts to win over existing
and new customers, and win back former customers.[15]
14399. Unsurprisingly, the main criteria that
needed to be met were those of the service, and at the forefront
was a need for reliability, especially in respect of delivery
on time. Such is the level of competition and pressure on costs
and the need to reduce these costs in companies, that unreliability
is intolerable as it simply adds to the costs. We should remember
that there are really very few companies that would show a great
deal of loyalty to any single mode of transport or service provider,
their loyalty is in effect to their customers and their shareholders
and, therefore, they cannot afford to stay with a service or service
provider that is unreliable.
11 Committee Ref: A163, Freight train operators' market
share (LINEWD-21305-012). Back
12
Crossrail Ref: P106, Crossrail Timetable Working Group, Freight
Services (LINEWD-GEN13-008). Back
13
Crossrail Ref: P106, Correspondence from Department for Transport
to Office of Rail Regulation, Crossrail Bill-Railway Powers, 29
June 2006 (LINEWD-GEN13-036). Back
14
Committee Ref: A164, Freight Transport Association Ltd (LINEWD-19705-002). Back
15
Committee Ref: A164, Freight Transport Association-Perception
(LINEWD-19705-004). Back
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