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


Memorandum by Thomas M J McNamara Esq (IW 60)

THE POTENTIAL OF INLAND WATERWAYS

SUMMARY

  This response considers the Ten Year Plan for Transport outlined by the Rt Hon John Prescott, Secretary of State for Transport recently, and the effect that this comprehensive spending plan might have on the principles outlined in the Waterways for Tomorrow daughter document and other related documents, which deal with the modal freight switch from roads to water.

  The first concern is that the £180 billion spending breakdown detailed in the Ten Year Plan is primarily directed at Road (£60 billion), Rail (£60 billion) and local transport including London (£60 billion), and that a significant commitment to funding water freight transport is absent. The second concern is that whilst the fiscal and policy commitment for road, rail and local transport appears to come direct from central Government the responsibility for funding waterborne freight initiatives appears to be devolved to local Government under PPG12 and 13.

INTRODUCTION

  Thomas McNamara is a PhD research student at the Maritime Research Centre of Southampton Institute. His PhD relates to answering some of the key questions surrounding the revitalisation of coastal shipping within the roads to water context. Briefly this means the issues of diverting freight from roads to water where an economic and an environmental opportunity to do so exists.

  As an advocate of a modal switch from roads to water, I am fully aware that waterborne freight transport is not the panacea for all our freight transport woes. A wide range of experts have produced statistics, which indicate that the pressures on the road and rail system in the UK are increasing relentlessly. In 1994, the Royal Commission for Environmental Pollution (Eighteenth Report) RCEP 18) stated that:

  "Even allowing for technical improvements in vehicle design, the consequences of growth on such a scale would be unacceptable in terms of emissions, noise, resource depletion, declining physical fitness and disruption of community life. In our view, the transport system must already be regarded as unsustainable in the respects we identified at the beginning of this report (1.15), and will become progressively more so if recent trends continue. We believe this is an issue of such importance that it justifies placing significant constraints on the future evolution of the transport system."

  I believe that waterborne freight can play an increasingly significant role in the future of a twenty first century intermodal transport system, if future planning, fiscal incentives and support both from central and local government and industry are forthcoming. For this to happen, investment in transport must be cross party and long term, and parity in fiscal investment must be addressed.

  I believe that a true response to the Waterways for Tomorrow document is not possible unless one also takes into account the proposals espoused in the Government's Ten Year Transport (Investment) Plan recently released.

BACKGROUND

  On 20 July 2000 (press notice 484) John Prescott unveiled the 10-year plan and it was described as a "£180 billion investment package to modernise the nation's transport system". The programme was said to provide £60 billion for railways, £60 billion for roads and around £60 billion for local transport (including London). In 10 years the plan was set to deliver:

    (1)  reduced congestion on our roads;

    (2)  modern trains with better services and reduced fares;

    (3)  a 50 per cent increase in passenger use of the railway;

    (4)  resources to enable the Mayor to reduce overcrowding on the Underground and congestion in London—with a £3.2 billion investment in the first three years;

    (5)  100 new bypasses;

    (6)  360 miles of trunk road and motorway widening;

    (7)  big improvements in rural transport;

    (8)  better bus services and a 10 per cent growth in passenger use;

    (9)  up to 25 new light rail projects in major cities;

    (10)  safer roads and railways; and

    (11)  lower emissions and better quality air.

  Undoubtedly many of the above mentioned benefits are good news for the nation especially in relation to the investment in rail services and infrastructure. However, it is of great concern, to note that nowhere in the list above, is waterborne freight mentioned or even alluded to. Concern deepens when one sees the amounts to be invested in road building and widening. This is especially relevant when one considers the 1994 response from the Royal Commission outlined above and when one remembers that John Prescott in 1992 stated in print, that:

    "We must recognise that we cannot build our way out of the crisis of congestion and pollution by spending more and more on new and wider roads. Dr John Adams estimates that the current £20,000,000,000 road-building programme will only increase total road capacity by 5 per cent, yet the Department of Transport has predicted that traffic will grow by 83 to 142 per cent by 2025".[41]

INTEGRATED TRANSPORT

  As waterborne transport seemed to be conspicuous by its absence in the initial sections outlined above, other sections including Integrated Transport were studied to see if the waterborne freight element had been included elsewhere. This also seemed pertinent as the 10-year plan was delivered as a 10-year package of investment measures designed to "modernise the nation's transport system to cut congestion and deliver real Choice". In fact John Prescott went further than this when he said in his forward "now we have a 10 year plan that will deliver the scale of resources required to put integrated transport into practice". In 1992 John Prescott made the following statement about this important subject:

    "Integrated transport system is a phrase often quoted but rarely defined, due to intellectual laziness on the part of those who argue its case. It really means that the whole is greater than the sum of its parts. The parts need to be co-ordinated to work together, not against each other—and the only body that can establish the regulatory framework that makes this possible is the Government".[42]

  John Prescott does not indicate however, whether the term "the Government" means central or local, but in the summary of the 10-year plan, the strategy for transport was outlined in the following way:

    "Our strategy for transport is to tackle congestion and pollution by improving all types of transport—rail and road, public and private—in ways that increase choice".

  This statement appears to ignore waterborne freight but how can all types of transport exclude waterborne freight? Especially when the summary goes on to say that the strategy requires a new approach, based on:

    —  integrated transport: looking at transport as a whole, matching solutions to specific problems by assessing all the options.

  It cannot be that the waterborne freight element was forgotten by mistake. The tone of this section seems to endorse the fact that this 10-year plan is a plan primarily for road, rail and local transport. The overall impression is that it is a plan designed to invest in, and integrate road, rail and local transport, it appears at the expense of fiscal and policy measures for water.

  Continuing the theme that an integrated transport policy for the 21st century has to include the waterborne freight element, and that somewhere in this 10-year plan there must be some fiscal and policy provision for water, the following table was analysed:

TRANSPORT 2010—THE 10 YEAR PLAN—ANNEX 1—INVESTMENT FIGURES Table A2 10 YEAR PLAN—TOTAL PUBLIC AND PRIVATE INVESTMENT AND PUBIC EXPENDITURE BY TRANSPORT MODE—(2001-02 TO 2010-11)

£ billion, outturn prices
Public
Investment
Private
Investment
Total
Public
Resource
Spend
Total
Roads (Strategic local and London)
13.6
2.6
16.2
5.0
21.3
Railways (3)
14.7
34.3
49.1
11.3
60.4
Local Transport excluding roads
19.3
9.0
28.3
30.6
58.9
London excluding roads (4)
7.5
10.4
17.8
7.4
25.3
Other Transport (5)
0.7
n/a
0.7
1.5
2.2
Unallocated
9.0
n/a
9.0
n/a
9.0
Charging Income (7)
n/a
n/a
n/a
2.7
2.7
Total
64.7
56.3
121.0
58.6
179.7
Source:  Transport 2010—The Ten Year Plan—Annex 1


  As one can see, the table above appears to set out in graphic detail the allocation of funds over the next 10 years for each transport mode. Again the waterborne freight element is conspicuous by its absence. It is only when one reads the footnotes provided for the table that one finds a mention of fiscal provision for water. According to the footnotes fiscal provision for water is contained within Other Transport [5] which has a fiscal allocation over 10 years of £2.2 billion, approximately 1.25 per cent of the total ten-year spending provision. If this figure seems small in terms of the total 10-year spend, the situation is made worse when one discovers that Other Transport includes ports, shipping, road safety, support for cleaner vehicles, aviation, strategic transport and transport security. A caveat is supplied within this footnote which states that "we have not included estimates of private investment in these areas".

  In a News Release (484) published on 20 July 2000 John Prescott states that the 10 Year Plan was "designed to tackle the legacy of under-investment, fragmentation and short-termism which had come from thirty years of neglect". He states again that the plan "will deliver the integrated transport systems this country needs and deserves. A system fit for the new millennium and of which we can be justly proud". He backs this statement up by setting out the investment and spending plans again in the following manner.

    —  £60 billion to improve the national rail network with new track, signaling, stations and rolling stock;

    —  £21 billion for national roads to tackle congestion hotspots and safety through widening schemes, bypasses, junction improvements;

    —  £59 billion to improve local transport, including up to 25 new light rail projects in our cities, guided bus schemes, park and ride, priority routes and funding to improve rural transport;

    —  £25 billion for London;

    —  and £15 billion held in reserve for future schemes.

  It has to be hoped that at least some of this £15 billion held in reserve, will be directed towards waterborne freight, ports, shipping and inland waterways. However, as this £15 billion is still only 26.5 per cent of the total 10 year government spend, and presumably it will still have to be shared amongst ports, shipping, road safety, support for cleaner vehicles, aviation, strategic transport and transport security, it appears that the amounts available for allocation by central government to projects involving water freight transport will be vastly different than those for road and rail.

  The concerns expressed here regarding central government funding for waterborne freight, I feel, are relevant when one considers the following government statements taken from Developing an Integrated Transport Policy, which appeared to recognise the importance and potential of the maritime transport sector.

  Under the heading Shipping, Ports and Inland Waterways, the following statements are made:

    (30)  the Government believes that a strong maritime sector can contribute positively to the UK's economic and environmental objectives; but we need to ensure that its economic potential is developed to the full; and that we derive full benefit from coastal shipping;

    (31)  there has been a steady increase in freight traffic using UK ports over the last 30 years, and 95 per cent of all UK trade now passes through our ports. Given the geography of the UK, it is clear that we must have, and plan for, a thriving and competitive ports industry;

    (32)  ports are a vital link in the support chain to and from our international trading partners, and it is essential that they are connected to the rest of the transport network in ways that will contribute towards our aim of more effective and environmentally friendly transport systems. So we want to ensure that ports play a full role in supporting the competitiveness of their regions; that any port development takes place in ways which are sympathetic to the surrounding natural environment and local communities; and that greater use is made of inland waterways as an alternative to road transport where this is a practical and economic option.

  Surely if the government aims espoused above are to be realised and taken seriously, central government fiscal provision for waterborne freight should have been included in the 10-year plan. I am not stating that exact fiscal parity between modes is realistic or indeed necessary. However, the absence of any solid mention of the waterborne element in the 10-year plan might indicate to some, that in reality the maritime sector is still seen to be the poor relation in terms of freight transport.

  The 10-year plan is so important to the debate surrounding the Waterways for Tomorrow document and therefore the potential for Inland Waterways for the following reason. The 10-year plan appears to set out the complete central government spending provision for transport over the next 10 years. If little or no provision is made for the waterborne freight element within this plan, then surely the future of funded and committed central government support for waterborne freight has to be extremely limited. If this is the case, and the results of the analysis of the spending plans indicate, to me at least, that this is so, does this mean that responsibility, commitment, funding and support for the waterborne freight element is to be totally devolved from central to local government? The Government has stated in Waterways for Tomorrow that they will support the development of the inland waterways through the planning system and in particular through PPG11, 12 and 13, but surely the inland waterways are part of a much larger waterborne freight network which includes coastal and short-sea shipping, and the seas, rivers and canals of the European Union where over 65 per cent of modern UK trading is carried out. If the responsibility for the inland waterways is to be devolved totally to local government, and there is to be no central government body co-ordinating the waterborne network as a whole, I feel that, despite increased gridlock and congestion on our roads and railways, the true potential for waterborne freight, and a truly sustainable 21st century integrated transport system, will be compromised.

INCREASE IN TRADE

In British Shipping: Charting a new course (BSCNC), the Government acknowledges that:

    "Shipping is an expanding, global business which carries most of the world's traded goods; is relatively free of capacity constraints, and less harmful to the environment than other transport modes. Also in the same document the Government acknowledges the fact that "according to estimates by the world bank and others, expansion of world trade is expected at the rate of 4 per cent a year over the next decade, almost doubling current volumes by the year 2010."

  On a domestic level statistics suggest that over 95 per cent of goods entering the UK arrive by water and that over 65 per cent of UK trade is now with the European Union. It is therefore surely a concern that already some experts predict that the UK port industry could be facing capacity shortfalls by the year 2000. MDS Transmodal stated that by the year 2000 ro-ro traffic could be 5 per cent above capacity, lo-lo 4 per cent, semi-bulk 7 per cent and dry-bulk 3 per cent through existing facilities if there is no action to transfer cargo between ports. They go on to state that by 2010 this shortfall will have risen significantly and that within 15 years ro-ro will be 32 per cent overcapacity, lo-lo 20 per cent, semi-bulk 21 per cent and dry bulk 9 per cent. In overall terms MDS predict very strong growth in future foreign trade over the next 15 years from 300 million tonnes to 500 million tonnes. They also predict a rise of 85 per cent in accompanied and unaccompanied ro-ro traffic over 1994 levels by the year 2010, and a rise for dry bulk cargo of 83 per cent and containers 81 per cent over the corresponding period.[43]

CONCLUSION

  The RCEP18, along with many other experts, explained in detail both graphically and in text, that pollution from road transport was the prime cause of poor air quality in the UK. It is also true that forecasts made by a range of experts including the DOT itself, showed a doubling in the overall level of road traffic by 2025. The RCEP has also stated that the UK transport system as long ago as 1994 was unsustainable and that if the trends of 1994 continued, even allowing for technical improvements in car design, the situation would become progressively worse. The re-introduction of the road building and widening programme announced in the 10-year plan coincides with estimates that vehicle ownership may increase from 27 million in 1999 to 36 to 45 million in 2025. Some might argue that even with increased road capacity, the spectre of congestion and gridlock is more likely to increase in the future than to diminish.

  Maritime transport is recognised as the most environmentally friendly of all transport modes. It is also true that apart from perhaps oil movement's waterborne freight as a sector has declined overall, during the past 20 to 30 years. However, the EU's continued support for sustainable transport which follows the EU's environmental concerns about the pollution and gridlock caused by road transport have been absorbed and acknowledged by successive UK governments. In the last six years there has been an increased focus on the reality and viability of a modal switch from road to more environmentally friendly forms of transport. The suggestion is therefore that across the EU, the future for waterborne transport should be improved. It is for this reason that the Government's 10-year spending plan has been analysed and questions concerning the allocation of funds to maritime transport/inland waterways vis-a-vis road, rail and local transport have been raised.

  I have to say that in general, I believe overall that the Government's new attitude to the transport issue should be applauded. However, in saying that, I wished to raise the point that the 10-year plan appeared to concentrate on terrestrial transport modes whilst providing little financial sustenance to the maritime sector. I also wished to raise the point that the UK inland waterways are connected to, and are an integral part of, the wider UK maritime network, and therefore to the seas, rivers and canals of the wider European Union, where over 65 per cent of UK trade is now carried out. Can the co-ordinated development of inland waterways and the integration of the whole maritime sector into the new (EU wide) 21st century integrated transport system announced by the government recently be achieved under a policy of total devolvement of inland waterways to local government control.


RECOMMENDATIONS

    —  That a central Government Department is set up to co-ordinate the support, funding, and integration of the inland waterways and the whole waterborne freight element into the new integrated 21st century transport system;

    —  that concerted government action and funding is addressed to fulfilling the potential of the waterborne freight element, especially in relation to intermodal freight villages already in existence ie Cabot Park, Avonmouth, and those planned for future development, ie Trafford Park Interchange on the Manchester Ship Canal.

    —  That FFg's are quickly extended to coastal and shortsea shipping and that environmental gains/savings, as well as road and lorry miles saved, are brought into the funding equation as they already are in Scotland. It might also be sensible to be more flexible in regard to the issue of vessel purchase vis-a-vis vessel charter/lease. Allowing a vessel charter whilst the funded operation is in an embryonic stage (as in Scotland) can lead to a vessel purchase when turnover etc stabilises. This can then allow increased business to be covered by other vessel charters, allowing that extra business to stabilise before purchase is necessary.

    —  That the issues relating to the polluter pays principle be re-addressed.

    —  That the issues of infrastructure charging are also re-addressed, and the abolition of port charges including light dues and conservancy charges which potentially distort modal choice are re-appraised.

    —  That equal treatment be quickly established between transport modes especially in regard to combined transport.

    —  That local government under the Local Transport Plans and PPG's promote the location of new industry and the re-location of existing industry where feasible near to ports and locations with water access.

  I would first like to thank the Environment, Transport and Regional Affairs Committee (ETRAC) for the opportunity of responding to the measures outlined in the recent Waterways for Tomorrow the daughter document to the Government's recent Transport White Paper.

4 October 2000


41   Roberts John et al (1992) Travel Sickness: The need for a Sustainable Transport Policy for Britain Lawrence & Wishart Ltd, London (pg Xiii). Back

42   Roberts John et al (1992) Travel Sickness: The need for a Sustainable Transport Policy for Britain Lawrence & Wishart Ltd, London (pg Xiv). Back

43   MDS Transmodal (1997) Port Development and Nature Conservation: Supply and demand in the GP Ports Industry RSPB, Bedfordshire. From an article by Justin Stares in Lloyds ListBack


 
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