Select Committee on Environment, Transport and Regional Affairs Appendices to the Minutes of Evidence


Memorandum by the Rail Freight Group (P 33)

  1.  The Rail Freight Group is the representative body of the rail freight industry, committed to increasing the volume of freight carried by rail.

  2.  Although the scope of the Committee's enquiry covers a wide range of issues connected with ports, we are concentrating in this response on the land surface access arrangements, and potential for rail freight.

  3.  The future policy in respect of ports and rail freight is an importation ingredient in the national rail and transport policy, in reducing significantly the number of lorries on the road, and the consequent environmental benefit.

RAIL CONNECTIONS TO PORTS

  4.  The majority of the medium and large ports in the UK were at one stage rail connected. Some still are, and carry useful volumes of traffic, whilst in others the tracks have fallen into disuse. In many cases, however, they could be reinstated at little costs to carry rail freight again.

  5.  Two years ago, the Rail Freight Group published a list of ports which were rail connected in the physical sense. It is a long list, and demonstrates the potential that remains for considerable increase in rail traffic to and from these ports. The list is attached as an Appendix to this paper.

  6.  The list of ports to which rail freight currently runs on a regular basis is much smaller, with the highest volumes being attained at Felixstowe, Southampton, Merseyside, Thamesport, Hunterston, Bristol and Humberside. However, other ports also carry good volumes and, in some instances, ports can act as useful road/rail interchanges for freight, because they often have good road and rail links. The UK's ports are therefore major customers of the railways.

VOLUMES OF TRAFFIC

  7.  The volumes of traffic through our larger ports provide major challenges to the railways. Although percentages vary, through Felixstowe and Southampton last year rail freight generally carried 20 and 30 per cent of the total traffic into and out of the port. Since much of the traffic is short haul and therefore not suitable for rail, this percentage is significant, and can require 15 to 30 trains per day in each direction. It demonstrates the ongoing confidence of the shipping lines and ports in the potential for rail.

  8.  More importantly, such major port traffic is growing at 10 per cent per annum, largely as a result of the global economy and shipping costs that are low by any standard. The consequences of this are that, in 10 years, growth at the same rate would have more than doubled and probably trebled this traffic in 20 years.

  9.  This is therefore a higher growth figure than the general target of an 80 per cent growth in rail freight over 10 years assumed in the Government's Ten Year Transport Plan. It is worth pointing out that a three-fold increase in rail freight traffic to and from ports over 20 years, requires significant investment in the port rail facilities themselves, in track capacity and capability as well as terminals around the UK. Such investment may, itself, take 10 years to deliver, hence the importance of thinking strategically, thinking long term and being prepared.

  10.  It is important that the railway industry and government accepts the regular moves made by shipping lines between UK ports. This is part of the normal commercial operation of the industry, but it does mean that the railways, as the ports, must accept the need to invest without the guarantee of a particular major customer committing to use it for 10 to 20 years. Given the right price and service, there is little doubt that such facilities will get used; the only question is by which lines.

  11.  It is for these reasons that new port developments are planned at Harwich, Canvey Island and Dibden Bay, Southampton. Although many doubt whether the large additional capacity will be required immediately, there are few who deny that they will be required at some time; the only real question is when.

  12.  Some comment that this growth will never happen but the point is that, if it does, the demand for surface land transport will grow at the same rates, and it will be transported either by road or rail. If rail does not provide the capacity or service, it will go by road with the consequent road congestion and environmental problems that this will cause.

  13.  For the smaller ports, there is an increasing role for them to play in taking both coastal shipping that may be in straight competition with road or rail, as we are regional and feeder services from other parts of Europe. These ports are also likely to see significant growth in traffic, both because shipping costs are low compared with other modes, but also because of increasing congestion in the major European ports. In addition, the Transport Act 2000 extended the rail freight grants to coastal shipping.

PORT FINANCING AND OPERATION

  1.4  Members of the Rail Freight Group and the All Party Parliamentary Rail Freight Group visited Rotterdam and Antwerp in September 2000. We were able to study the operation of these ports and the rail connections, and some interesting facts emerged.

  15.  Firstly, we note that the quays, the harbour dredging and the rail freight facilities were in both cases funded by the local authority and/or the state. We were not able to identify in much detail how much, if any, subsidy was provided but, even if there was no actual subsidy, it was clear that significant capital was available for new facilities, including rail terminals, which were built to high standard to provide volume for growth and easy operation. Rail connections to the ports were, similarly, operated efficiently and without major delays, with investment in new lines, such as the Betuwe freight only line connecting Rotterdam to Germany.

  16.  The size of both ports was many times that of the UK's largest ports, and it was interesting to note the different modes of working rail freight. At Antwerp, many of the quays were rail connected, and individual wagons or boxes were transported by rail to marshalling yards where they were formed into trains for onward despatch inland. At Rotterdam, transport within the port complex was by road, with boxes being loaded onto trains at two major intermodal terminals.

  17.  This all compared very favourably with experience in the UK where the UK's major ports are still much smaller; they generally operate in less easy situations. Whether for this reason or not, we continue to be concerned that Felixstowe Port charges a premium to all its customers who choose to use rail rather than road. This is an added disincentive to use rail, and we hope that the port owner, Hutchinson Ports Ltd will reconsider this on an urgent basis.

RAIL SERVICES TO AND FROM PORTS

  18.  Although the carriage of deep-sea containers dominates the rail freight traffic volumes to ports, many other goods are carried in conventional wagons. The largest tonnage is coal, which is imported at Hunterston, Bristol and at the new facility on the Humber. The operation of these train services requires co-ordination between the shipping lines, ports, rail operators and the power station customers, with volumes, types of coal and destinations changed at a moment's notice, a very different operation from the old colliery to power station merry-go-round which happened day-in, day-out.

  19.  Other wagonload cargoes to and from ports include cars and parts, agricultural products and china clay. They may appear to be specialist, but volumes can be large and they require separate facilities in the ports from deep-sea box handling.

  20.  For the boxes, the major change in recent years is the international trend to 9'6" high boxes. The problem for the railways is that these cannot be carried within the existing UK loading gauge except on very expensive and inefficient wagons. Unless action is taken to address this problem on our railways, rail freight will inevitably be excluded from an increasing share of the market, and will see volumes drop significantly.

  21.  The key to maintaining deep sea box traffic on rail, and increasing both volumes and market share, is to increase the loading gauge to accommodate the 9'6" boxes on conventional wagons, and to ensure that there is adequate capacity on the routes which are cleared for gauge to accommodate the expected traffic along with the growth on other rail freight and passenger traffic.

  22.  The new gauge for 9'6" boxes is now called W10 or W12, with the large piggyback gauge (to accommodate four metre high trailers on rail wagons) W18. We understand that the Strategic Rail Authority has agreed that priorities for gauge enhancement to W10/W12 is from the Midlands to Felixstowe/Harwich and Southampton, whereas they are studying the W18 gauge from the Channel Tunnel to Glasgow, since the majority of traffic in this route is carried in lorry-semi-trailers on the parallel motorways.

  23.  The Rail Freight Group supports this decision, but remains concerned about the time and cost of implementing the gauge enhancement works.

GAUGE ENHANCEMENTS—ROUTE BY ROUTE

  24.  The existing West Coast Main Line from Glasgow to Willesden has been found by Railtrack to be capable of carrying W10/W12 traffic; two structures have been altered. However, this line on its own is of no use to deep-sea container traffic since it does not connect to any major port, and it has not been cleared to carry W18 piggyback traffic, for which there is a demand.

  25.  Although there is some demand for piggyback W18 services to major ports, it is small compared with the need to carry 9'6" boxes. Railtrack has already committed that any structure altered to accommodate W10/W12 will be rebuilt to take W18 so that, if at a later date, W18 is agreed, it will not be necessary to rebuild structures a second time. However, structures clear to W10/W12 but not to W18 will not be altered in the first stage works. We discuss capacity later.

Felixstowe/Harwich—Midlands

  26.  The SRA has commissioned Railtrack to undertake a study into the costs of increasing the gauge on the Felixstowe-Ely-Peterborough-Nuneaton line to W10/W12. A decision on which gauge, if any, to implement will, we understand, be made in the next six months, so that work could start before the end of this year.

Southampton—West Midland

  27.  The SRA has more recently instructed Railtrack to study the same gauge clearance study work on the route via Reading and Oxford.

Terminal connection

  28.  We are concerned that these studies may not include the gauge-enhanced connections to terminals, such as Trafford Park, Crewe, Merseyside, Mossend, Hams Hall and Daventry. Without these connections, these gauge enhancements will be of little use.

CAPACITY

  29.  It is clear that a gauge-enhanced route is of little use in attracting additional high gauge traffic if there is not sufficient capacity to meet this demand. We remain concerned on many routes about the slow progress on developing proposals to provide for the necessary capacity, as well as for meeting the demand for operating freight trains 24 hours a day seven days a week. The recent post-Hatfield possession over-runs, particularly and Leeds and Willesden over the New Year, demonstrate how far Railtrack has to go in achieving such reliability and capacity.

Felixstowe—Nuneaton

  30.  Although the gauge enhancement can be done in two or three years, the capacity work is at a much earlier stage of study. On that route, it is said to be dependent on resignalling at Leicester, and there is a debate on whether the 24 hour, seven day requirement should be met by providing bi-directional working on the Felixstowe Nuneaton line or by gauge enhancing additional route via Chelmsford, the North London Line and the West Coast Main Line.

Southampton—West Midlands

  31.  We have similar concerns here, especially if Dibden Bay is developed and required an addition 20 to 30 trains per day in each direction through Reading and Oxford. We have urged Railtrack and the SRA to study this well in advance of any plans for refranchising the Great Western passenger services, which may required a double deck station at Reading.

West Coast Main Line

  32.  The most serious problems occur on the WCML, to which all routes converge. There is a regulatory requirement for Railtrack to provide an additional 42 train paths for freight or passengers beyond the existing service needs, but this is well below the freight companies' expectation of needing more than 120 additional paths per day in each direction on that line in 10 years. This is not surprising, since the WCML connects the UK's major centres of manufacture and consumption.

  33.  More recently, we understand that Railtrack has stated that the only way it can accommodate the fast Silverlink passenger trains south of Northampton without building a flyover at Hanslope is to take the day-time paths out of the 42 allotted (say 22) and give two of these paths to each fast train to operate on the slow lines.

  34.  The majority of the 42 paths were meant to be for freight, but this latest idea means that there will be no additional paths for freight beyond what is available at present. It indicates again the nonsense of a system that, because of franchise requirements, allocates passenger paths before freight paths without any mechanism to providing for the needs of freight as they occur.

  35.  North of Crewe the situation is even worse, since we understand that Railtrack has now stated that it cannot accommodate even the existing freight on this line, let alone any growth in traffic, alongside the operational requirements to which it has contractually agreed with Virgin to provide.

  36.  Both these issues, North of Crewe and South of Northampton, are particularly serious on this line, since it is the only one which is gauge enchanted to W10/W12, and we do not believe that any diversionary routes are even being considered at present. They are of course equally serious for the generality of freight traffic, which does not require gauge enhancement but does require a decent quality and speed of service.

FINANCE

  37.  The Government's Ten Year Transport Plan and the Spending Review in July 2000 allocated some £3.4bn of government finance over ten years to rail freight. RFG welcomed this as being necessary to achieve the target 80 per cent growth in ten years. Even after Hatfield, this could occur if the network gets back to reliable operation quickly. This finance is required primarily for infrastructure investment for freight, and gauge enhancements as described in this paper is an early candidate for such expenditure. There are many other times, more capacity for freight, piggyback W18 gauge between Glasgow and the Channel Tunnel, a more flexible grants regime etc.

  38.  However, since July, the Regulator has increasingly become more lenient on Railtrack, allocating them increasing amounts of the SRA/Government money for the post Hatfield work on track, for TPWS and several billion for the West Coast Main Line. We have argued many times before that many of these costs were contractually down to Railtrack. By giving the company more and more government money for work, which it should have paid for itself, the Regulator and Government may have saved a short-term political embarrassment in avoiding Railtrack going into liquidation. Such a move would at least avoid a massive compensation to Railtrack's shareholders.

  39.  However, more importantly, all these extra billions for Railtrack will mean less for rail freight. We fear for the £3.4bn and will be seeking assurances from ministers that this money is ring fenced for rail freight.

CONCLUSION

  40.  We believe that the ports, both at present and in the future, are well placed to cater for the growing demand for maritime traffic. Rail freight can and, with the right service, charges and grant regime, grow its market share and overall volumes very significantly.

  41.  We believe that, since the SRA started putting pressure on Railtrack, there is better progress on gauge enhancement studies, and an intention by the SRA to fund them, provided that funds are still available and the financial case is made.

  42.  We remain much more concerned about the capacity issues, both from Felixstowe/Harwich and Southampton but more especially on the West Coast Main Line itself where a combination of the Regulator and Railtrack is still failing to deliver the capacity for freight that is absolutely essential to the continuity of existing services, let along the growth that all want to see.

Lord Berkeley

Chairman

January 2001


 
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