Select Committee on the Crossrail Bill Minutes of Evidence


Examination of Witnesses (Questions 9020 - 9039)

  9020. LORD BERKELEY: The Committee has heard from many customers. Lindsay is representing the second largest rail freight operator, the Freightliner Group. Could you explain, Ms Durham, what your company does and your experience, please?

   (Ms Durham) Freightliner is the second largest rail freight operator in the UK. We haul about 30 per cent of the rail freight in the UK currently. We are a specialist in the movement of deep-sea containers from ports to inland terminals and then for onward distribution to retail parks and shops. We also move aggregate and cement into the London area from the Peak District, Leicestershire and from South Wales. I have been working for Freightliner for nearly five years, and I have been working in the rail freight sector for 19 years.

  9021. If we just examine briefly your rail freight operations and that of your colleagues, if we start on the east side, can we have slide 22, please.[31] This is mostly containers. Could you just go through the business, please.

  (Ms Durham) Freightliner trains serve the major ports at Felixstowe and Tilbury on the east side; and in the future we hope to serve the new port and London Gateway. We move trains to the conurbations in the West Midlands, north and Scotland and then onward distribution locally by road. Rail currently has a 25 per cent market share in this sector. It used to be 17 per cent in 1996 but we have increased the market share, and we have done that by increasing service quality. Freightliner in that time has increased right time arrivals of containers to customers from 90 per cent to 98 per cent. We have done this through a lot of private investment. Freightliner alone has raised £380 million of private investment, and that is quite a lot for a company of our size. Other rail freight operators have also invested, and competition has also encouraged the service quality to rise. We have to be able to reach the service quality because it is the service quality that road also delivers. If we cannot get the same service quality at least as road we simply do not get the business. In order to make that investment we need certainty on the railway; and we need to know that we can grow our business. We cannot go to our investors and say, "We'd like some money to buy some new locomotives", and they say, "Well, how do you know you're actually going to be able to run those trains?" and we say, "We don't really know". We do need to understand that there is going to be capacity available on the railway to grow rail freight so that we can invest.

  9022. The next slide, slide 23, tries to explain what, logistics flows?[32]

  (Ms Durham) Yes, this is just really to demonstrate that movement by rail is somewhat more complex than movement by road. You will see at the bottom of the slide road is a very simple movement from the quay of the port onto the road vehicle and straight to the final destination. Whereas by rail we have to shunt the container onto some sort of road vehicle, it could be an internal road vehicle, on to the train at the rail terminal, and then rail takes the main trunk leg to another rail terminal which will be in a conurbation, say, in the Midlands or the north and then we lift the container by means of a crane onto a lorry and then it is delivered locally. This slide really demonstrates that for us to compete with road we have to be really efficient; because if we are not efficient we just will not be able to get that 98 per cent delivery that is required by the market. You have to remember that road still has 73 per cent of this market and we have to keep improving to be able to move more goods by rail instead of road.

  9023. Can we move to slide 24.[33] Mr Cann has given some gross figures for containers and you have similar views. Do you operate from other ports besides the ones on the north Thames and Felixstowe?

  (Ms Durham) Yes, we also operate from ports at Southampton, Thamesport and Liverpool, but they are not directly affected by Crossrail. We do support the forecasts that are industry forecasts, which have been supported not only by the industry but also by Government. It is only the continuation of the trend for the last 20 years but it is just expected to continue in the same manner. You have heard a lot of figures today about growth and it is quite difficult to get your head round it—lots of growth figures over lots of different times; but one thing we always think about is that within ten years there are going to be two million more containers a year arriving at our ports and they need to be transported somehow inland. If rail has the current market share of 25 per cent this would equate to 75 more trains a day on our rail network. Hopefully, that gives you an idea of the scale of the issue, because it is very difficult to relate, I know, all the different numbers to reality. We hope to grow market share. We have already grown market share, and we hope to continue to grow market share. We can only do this by using our equipment very efficiently. If you think about easyJet, they use their aircraft very efficiently. They keep their aircraft moving all day and they only stay in the airport as short as possible. They have relatively cheap fares but by making high use of their capital equipment they can make a profit. In order for us to compete with road we have to do likewise, and we have to keep our equipment moving 24 hours a day, six days a week. It is not like a passenger service where it stops at night. We continue to run 24 hours a day. We would like to run seven days a week, but that is another issue.

  9024. Finally, on this slide, could you explain to the Committee how many containers or TEUs go on one train? Some members may find it useful to do the calculation.

   (Ms Durham) On average there are 30 containers on a train, and that is in both directions.

  9025. Are they 40 foot long containers or 60 foot long?

   (Ms Durham) That would be a mixture of 40 foot and 20 foot containers generally on the train, because heavier goods tend to go in 20 foot long boxes, and lighter goods tend to go in 40 foot long boxes.

  9026. Slide 25, could you explain the routeing of the trains?[34]

  (Ms Durham) This is what I hope is a very simple map, so that you can see the routes that are currently used from the major ports at Felixstowe and Tilbury, and the future ports at Bathside Bay and London Gateway. These are the rail routes; and where it is highlighted with a red blob is the Crossrail route east of London. You can see that our trains will have to go through the Crossrail route, and then they go on towards the north of Britain and the Midlands.

  9027. You have left out any line between Felixstowe and Daventry and Peterborough in the middle, which you will be talking about presumably in the future as a diversion route. Could you just explain why the trains do not go on that at the moment?

   (Ms Durham) That route is not currently gauge-cleared. You heard earlier about the worldwide trend of boxes moving to be nine foot six high instead of eight foot six high, and we cannot currently move those boxes on that route. The Government has funded the upgrade of that route, and we hope it will take place over the next few years. I will talk about that a bit later. I think the important thing with that route is that is a route for future growth. I know the next witness, Mr Garratt, will talk about the number of trains that can be pathed through Crossrail before and after Crossrail, and they are very similar. There is growth that cannot be accommodated now that is known about. The Felixstowe to Nuneaton route is to take that future growth.

  9028. Let us move on to slide 26, which is the train operator's view and what happens on the west side of London, which rather complements Mr McLaughlin's evidence.[35] Take us very quickly through this, please?

  (Ms Durham) The nub of it is that London needs a constant and reliable supply of aggregate materials. One of the big issues is the terminals in west London that were highlighted on the earlier map are quite small. You can imagine that the cost of land in London for an aggregate terminal is disproportionately high, so the terminals tend to be quite small, so they need to be very regularly restocked. It is very important to the building industry to know that they can get a reliable supply. It is no use going to terminal and a particular type of stone is not available. We need to be able to deliver by train very regularly and reliably. We cannot let those people down because they really do not hold a lot of stock.

  9029. The map on the next slide is again similar?[36]

  (Ms Durham) It is similar. You can see the routes marked, the Midland main line, which is the main route from Leicestershire and the Peak District quarries coming down through London and crossing the Crossrail route; and the delivery to the terminals are the yellow blobs. From the other direction, the quarries in Somerset and also South Wales; and they deliver not only to those terminals marked yellow but also to the other side of London, to east London. They also require to use the same route as Crossrail.

  9030. If we move on to the next slide, 28, this is really back to the more general issues of what train operators need during the construction of Crossrail to mitigate the adverse effect of any possessions or closures.[37] Could you take us through that, and could you just confirm what Mr Elvin mentioned, that the Gospel Oak-Barking upgrade in its total has been agreed and funded?

   (Ms Durham): Yes. I will deal with that first. The Barking to Willesden via Gospel Oak route is funded and work has even begun on that route to upgrade it. It has not yet finished. That has been funded by the Government but one very important point is that the timetable model that Crossrail has done does assume that that route is open, so although it was not actually done solely for the purpose of Crossrail it is a very important plank in enabling Crossrail.

  9031. What I want to talk about here, though, is more about the disruption while the Crossrail work is going on. This is something that is currently very vague to us. We have not yet had any proposals from Crossrail as to what the disruption is likely to be and we are very concerned, because we need to be able to offer a reliable consistent service otherwise our customers will simply choose to go by road. For example, I do not know if you remember a few years ago there was an accident at Hatfield, and after that accident there were a lot of problems on the rail network where trains were slowed down and Freightliner lost 15 per cent of its business to road, and it has taken many years to build up confidence with the customers again that rail is a reliable mode. So it is very important to us that we can continue to run while Crossrail is being built, and there is a mixture of measures that we would look for. One is that on both the east and west side of London, of the tunnel, there are four rail lines and we would ask that only two of those are closed at once, where possible.

  9032. Can I stop you there for a second? I understand that Network Rail is concerned that they still have not reached agreement with the Promoters over the construction phase and the operation phase of these two four track lines. If Network Rail was not responsible for two of the tracks and TfL was responsible, how would that affect the construction phase and your ability to run trains?

   (Ms Durham): I think we would be very concerned. What is important is that two out of the four lines are open and if two belong to Network Rail and two to TfL we do not understand how that would work. We do not have rights to run on TfL rails, we only have rights to run on Network Rail rails, so it is very important the four are managed as one both during the building of Crossrail but also after, when the Crossrail service is running, because there is still going to be a need to do regular maintenance work on the routes. It is the normal practice now that maintenance is done on two out of the four rail lines overnight and we continue to run on the other two lines, but those lines swap over in different weeks so it is very important that they are managed as a package and not by two individual companies.

  9033. Looking at the last two bullet points on your slide, I am sure you appreciate that asking the Committee to have a view on these two items is outside the scope of the Bill, but are you suggesting that the Committee might recommend to Government that they accelerated the funding of these two upgrades for that reason?

   (Ms Durham): I would ask the Committee, yes, that they do recommend to Government. In the case of the Barking to Willesden via Gospel Oak route, that route is fully funded and all I would ask is that the Committee recommend to Government that that work is finished before major construction work starts on the Crossrail route. Also, the Felixstowe to Nuneaton via Peterborough route is currently partly funded, the gauge work is funded, and I know that Network Rail have recommended that a further £50 million is spent out of the strategic freight network money that has been allocated by the Government in the White Paper which was published in June last year, so there is still further work after that. I would also ask the Committee that they recommend to Government that those works are also finished before the Crossrail major disruption commences.

  9034. Ms Durham, you have heard a lot of discussion today about industry processes, access rights, et cetera, and your view is on slide 29 of the works, which I think all the Petitioners today would like to see committed.[38] Could you give your view on whether there is a conflict between what the Office of Rail Regulation might be saying and what you are asking for here in terms of asking the Committee to require the Promoters to commit to these rights? And could you at the same time give a view as an operator as to what it means to improve the operation quality performance on a line from 72 PPM to 92 PPM? Is it easy? Is it child's play? Or is it incredibly difficult?

  (Ms Durham): I will take the first one first. Freightliner fully supports the Regulator's decision on the access option. We make it absolutely clear we do not want any amendments to that, and it is right that the independent Rail Regulator made that decision. We do see that it is the role of the Committee and not the Rail Regulator to make decisions on rail enhancements. The Regulator's role is to allocate capacity on the network. We do not see it as his role to direct people to put in new capacity: it is really the job of Government to decide what scheme and capacity is created. If this was a planning inquiry for a private scheme, if Crossrail was a private scheme, it would be as part of the planning conditions that such conditions to make commitments to infrastructure were made, so we see the two things as quite separate, and it is really for the Committee to decide.

  9035. We have this list of six, and it is the same list as EWS will show you tomorrow except there is one further one, the Chadwell Heath/Goodmayes loop, which is on the east side and EWS are not bringing that forward tomorrow. These are six works out of the total of 24, so we are not asking for all works to be committed, just these six, and the reason is that they are particularly important for how passenger and freight services will operate together, and these allow flexibility in the network. Some of them are loops or extra bits of line that allow basically freight services to be put one side while passenger services operate, and they are particularly important during times of perturbation where you have a bit of flexibility to move services around. If you have a timetable and you plan to use 100 per cent capacity it will not be reliable, and this may be one of the issues as to why the current model only shows a 71 per cent PPM, which everyone has agreed is unacceptable, and I know Crossrail have agreed that it should be at least 92 PPM. It is a very big challenge to get from 71 to 92; the 71 already assumes that all this infrastructure will be built as per the list in the Bill, and we will be concerned if these were taken out, that would make 71 even worse. So on top of that I think there is a big challenge, and I think we are waiting for Crossrail to put forward proposals as to how they are going to get from 71 to 92.

  9036. Finally, were you aware of the first response from the Promoters to the ORR's termination of the access option where basically, and it is dated 17 March and I think you have seen it already, the Promoters have not quite, I think, accepted the wonderful independent due of the industry processes, and in paragraph 4 they are basically saying: "Well, if we do not get all the trains we asked for in the original option application we are going to leave out these freight loops, because there is not really any demand for them and there is no business case". Is that reasonable?[39]

  (Ms Durham): Obviously we are aware of this response and when we received a copy of it we were quite concerned, because it does seem to indicate that Crossrail were unhappy with the proposed access option from the Rail Regulator where the Rail Regulator has said that at the moment he will not allocate two paths an hour offpeak to Crossrail but he will leave those unallocated and anyone can apply, including Crossrail and freight operators in the future, and as a consequence of this the DfT wrote this letter that indicates that some of the enhancements will not be done if they do not get their two paths an hour. So it is an indication to us that Crossrail are considering not doing all the enhancements, and I think these will particularly be a concern to reaching the levels of performance for freight and passenger together, and even being able to time all of the freight services if these are not done.

  9037. Even if they have done a timetable which was only based on all those enhancements being built?

   (Ms Durham): Yes. Obviously there is the Regulator's process to protect us but I think one of our concerns is that these works need to be done at an early stage of Crossrail. It is no use getting to the end of all the works and then finding the model does not work, because it would be exceptionally disruptive to go back and have to do more works rather than new Crossrail services operating, so it is very important that all the works are done during the construction phase.

  9038. LORD BERKELEY: That is the end of my examination, Ms Durham.

  9039. CHAIRMAN: Mr Elvin?

Cross-examined by MR ELVIN



31   Committee Ref: A52, Movement of deep-sea containers by rail (LINEWD-34_05-023) Back

32   Committee Ref: A52, Deep-sea containers supply chain-Rail v. road (LINEWD-34_05-024) Back

33   Committee Ref: A52, Future Growth (LINEWD-34_05-025) Back

34   Committee Ref: A52, Freightliner map highlighting interaction with the Crossrail Shenfield to Stratford line (LINEWD-34_05-026) Back

35   Committee Ref: A52, Movements of aggregates and building materials for London (LINEWD-34_05-027) Back

36   Committee Ref: A52, Freightliner map highlighting interaction with the Crossrail Maidenhead to Paddington line (LINEWD-34_05-028) Back

37   Committee Ref: A52, Freight train operators' needs (LINEWD-34_05-029) Back

38   Committee Ref: A52, The essential new works for freight (LINEWD-34_05-030) Back

39   Committee Ref: A52, DfT response to the ORR's decision on the Crossrail Access Option (LINEWD-34_05-093) Back


 
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