Welsh Affairs CommitteeWritten evidence from the Freight Transport Association

Overview

1. Freight Transport Association (FTA) would like to thank the Welsh Affairs Committee for the opportunity to participate in this Inquiry. Our response will concentrate on areas which have a direct impact on our members.

2. Freight Transport Association represents over 14,000 companies engaged in the transport of freight both domestically within the UK and internationally. Several hundred of these members are based across Wales, and many hundred more are involved in moving goods between Wales and the wider world. Their interests range from those as operators, carriers, freight service providers, through to customers—suppliers of raw materials, retailers, manufacturers, and wholesalers, covering all modes of transport—road, rail, inland waterways, air and sea. FTA is the UK’s main intermodal trade association, representing every step in the supply chain.

3. Freight transport touches every aspect of society and the economy. The goods on our shop shelves or delivered to our door must first be moved as freight. Efficient supply chains bring the consumer all year round product availability, up to the minute fashions and rapid response times to orders placed in the comfort of our own homes or business.

Roads

4. Road currently remains the dominant land freight mode between Wales and other countries, and also within Wales, because road freight movement has a number of advantages to the end user such as;

Direct access to/from collection and delivery points (ie door—to—door movements);

Flexibility and freedom for the supplier (or his nominated contractor) to match fleet capacity (number and size of vehicles) to demand (volume/weight of goods to be moved);

Ability to operate “Just in Time” delivery systems, whereby the combination of direct access and flexibility of fleet capacity enables a supplier (or his contractor) to replenish customer stock levels “Just in Time” (ie when stock has declined to a pre-determined minimum level);

Speed of both delivery and collection; and

Highly professional services.

5. In England the DfT’s guidance on “Funding transport infrastructure for strategically significant developments” (published April 2009) set out a framework for determining the extent of public contributions to necessitate infrastructure upgrades (ie road and rail links). But the key question that will determine the success or otherwise of this policy will be the extent to which the Government identifies funding streams for such improvements.

6. In England there are currently discussions being held with stakeholders designed to identify ideas to improve the A14 corridor connecting the east coast with the Midlands. Government suggest that whilst they have no intention of charging motorists for an unimproved facility, they would expect to consider tolling for enhanced capacity along with other cost sharing arrangements. FTA believes that if a decision comes down in favour of tolling then there needs be robust safeguards in place to ensure that the outcome benefits all road users along with the wider benefits for the area, rather than limited to a financier of the infrastructure.

7. Tolled infrastructure should not be the first choice if no realistic alternative to the route exists. If Tolling is applied then it must be affordability, realistic and provide tangible benefits for all road users and the wider socio-economic area. Tolling should also encompass guidelines which clearly define how the tolls are paid, ie free flow technology along with the ability of government to regulate annual increases therefore reducing any detrimental impact on the road user which is clearly evident on the Severn Crossing.

8. Around 2017 the Severn Bridge is due to come back into public ownership, with its users having paid just short of £1 billion. Whichever Government acts as administrator for the Bridge it should not be viewed as a “Cash Cow”. The rate of toll on these bridges impacts the road freight sector directly and constitutes a direct tax on doing business for Welsh operators, or on doing business in Wales.

9. The M4 and A55 are both designated as part of the Tens-T network and provide important access to markets in England, Ireland and Europe. They are also important for access to and from all of the main ports in Wales. It is therefore important that these routes are maintained to a high standard to accommodate the expeditious movement of freight traffic, which benefits the environment, and the economy.

10. FTA welcomes the current consultation on the future of the M4 around Newport; this important part of the road infrastructure is near or has exceeded its design capacity and is urgently in need of improvement. The four options range in cost from £45 million to £830 million, therefore the Welsh Government should ensure that action is taken at the earliest opportunity to add this to their trunk road programme and help keep development costs down through early adoption.

11. Government should not underestimate the importance of working closely with the freight sector on identifying where investment and change is required. It is therefore important that the close working relationship developed with the Welsh Government through forums such as the Wales Freight Group are regenerated and maintained. Policy makers must be open to dialogue with freight generators to ensure that future decisions regarding road and rail and importantly, access are based on the needs of industry. Such an approach would establish a strategic freight policy that is based on the needs of the freight and industry, identified by industry, rather than the aspirations of politicians, civil servants and others that might seek to prejudice decisions on investments in strategic infrastructure.

12. lorry parking facilities are an essential part of driver welfare and reducing the impact of inappropriately parked HGV’s who by law are required to take daily breaks and minimum rest periods overnight, particularly along these routes. Planning permission should be viewed with a presumption of acceptability rather than have developers plans refused by a local authorities planning/transport committee. Indeed Flintshire has refused three applications for lorry parks in the last two years. Given the localism agenda, safeguards should be put in place to ensure that projects which have a national or strategic outcome be considered using a separate set of guidelines rather than left to the political apparatus at local level, indeed recommendations (Ro7, Ro8) outlined in the Wales Freight Strategy1 recommends that this real problem be considered at a national level.

Rail

13. Rail freight is vital for the future economic and environmental well-being of the British economy. It has in essential place in securing continuing competitiveness and business wealth creation through its part in an integrated supply chain. Rail freight has a particularly large potential for the UK over the next 30 years as containerised imports increasingly become the norm.

14. Too often, any political discussion on rail is automatically taken to mean passenger rail. In fact, around 30% of the traffic carried on the British rail network is freight trains, rather than passenger.2 Whilst the political imperative behind a focus on passenger traffic is understandable, it is vital to consider freight as an equally important part of the rail network’s offering to the British economy.

15. Rail plays a highly significant part in the economic well-being of Britain. Rail freight moves an estimated 43.5 million tonnes of goods to and from the UK’s ports. 65% of intercontinental trade to the north of England and Scotland arrives by rail from the UK’s southern gateway ports.

16. Rail freight has increased by 10% since 2004 against a total freight market that has fallen by almost 10% in the same period due to the recession. Most significantly, intermodal rail freight (containerised movements outside the traditional rail areas like coal) have increased by 60% over that eight year period, demonstrating that rail can successfully service this major part of the logistics market.3 This still represents only about 12% of the UK surface transport market, so rail has great potential to do more.

17. As the UK’s pan-modal logistics trade association it is FTA’s assessment that rail has the ability to not only increase the amount moved on the tracks but also to increase its market share. This development would enhance the UK supply chain. More efficient supply chains support the performance of our exporters and improve the value for money of our imports, helping fight inflation. Retailers such as Marks & Spencer, Superdrug, Argos and ASDA are increasingly using rail as part of their supply chain solution with rail performing the trunk movement from import point to distribution centre and road performing the final delivery to store. See FTA’s “On Track—retailers using rail freight to make cost and carbon savings” report for more details.

18. A typical freight train can remove 50 lorries from Britain’s roads. Over the last six years, rail freight is estimated to have saved two million tonnes of pollutants, 6.4 billion lorry kilometres or 31.5 million lorry journeys. When compared with carrying the same tonnage by road, rail produces less than a tenth of the carbon monoxide, around a 20th of the nitrogen oxide, and less than 9% of the fine particulates and around 10% of the volatile organic compounds. Every tonne of freight carried by rail produces at least 80% less carbon dioxide than if moved by road.

19. For Wales to compete with the southern ports changes need to be considered to accommodate containerised traffic. Issues such as the Severn Tunnel and development of a W12 (or at least W10) gauge clearance should be looked at. This allows compatibility with standard freight flows, allowing the line to work as part of rail’s developing Strategic Freight Network.

20. Alternate routes out of south Wales are gauge constrained. While this is not a big issue for bulk movements (eg steel and coal) it is an issue for containerised movements. With increased production at places such as Port Talbot, there is a growing demand for container movements. Diversionary routes need a better gauge clearance.

21. In order to attract retail traffic onto rail it is essential that land is available at the intermodal interchange point to attract retail warehousing for RDC’s. This will allow retailers to develop RDC’s at the rail terminal allowing rail to be viable to service the RDC.

22. There also needs to be a plan for the Welsh ports that are rail connected to have adequate rail infrastructure and land to support the use of rail. Currently we are not convinced there is adequate infrastructure. This would radically reduce the ability of rail to compete with road. The Wales Freight Strategy4 reinforces these concerns with many of the recommendations on rail freight consistent with the statements above. FTA would recommend that these are taken forward, using the Wales Freight Group as a mechanism for delivery.

April 2012

1 One Wales Connecting the Nation—Wales Freight Strategy, May 2008

2 As defined by tonne kilometres. Source ORR

3 All figures based on tonne km. Source Network Rail

4 Welsh Assembly Government: One Wales Connecting a Nation: The Wales Freight Strategy (May 2008)

Prepared 5th March 2013