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In political terms, the next few months should be very interesting as we edge towards the General Election in May. The leading political parties are already manoeuvring into position for what is predicted to be a hard-fought and bitter battle. Whatever the colour (or colours) of the next government it will need to work with the logistics sector to realise measures that will benefit not just this sector but UK PLC as well.
When delivering his Autumn Statement, George Osborne announced the continuation of the freeze on fuel duty but for many commentators he could have used the moment to deliver a ‘real terms’ cut in the level of duty. Considering that oil prices continue to plummet and that fuel duty is around 70% of the price of a litre of fuel the Chancellor of the Exchequer may have missed a golden opportunity to also ‘reward’ transport companies and the motoring public.
So, as Election Day approaches, political leaders and parliamentary candidates could well come under pressure to reveal if their party will adopt a positive approach on this issue and support a real terms cut in fuel duty. The findings of FairFuelUK have proved beyond doubt that such a measure would boost employment levels and the economy as a whole, so not only does it make sense it really would be a vote winner.
Lorry drivers should now have completed their first block of DCPC periodic training – yes, the deadline was 10 September. For those who are still not compliant the message is simple – that they, and the operators they work for, are in danger of action being taken against them if they continue to drive.
Initially, many viewed periodic training as an unnecessary burden but over time drivers and operators have come to recognise the benefits of keeping skills up to date. Going forward, progressive logistics companies see it as an integral part of running a safe and efficient business.
As someone involved with CPC from its initial concept, Geoff Dunning has seen many changes during his years in the road transport sector. He recently retired as chief executive of the Road Haulage Association (RHA) and his article in this edition reflects on his time in the industry. As a key commentator, Geoff has always championed the cause of the RHA, its members and the sector. He leaves the organisation in very good health.
I would like to personally thank Geoff for finding the time in his busy schedule to write for Freight Industry Times, and for providing such straight-talking articles.
Mike Parry, Editor
This summer will stay in the memory of two of Freight Industry Times’ regular contributors – Geoff Dunning of the Road Haulage Association and Lesley Batchelor of the Institute of Export – for some time to come.
After 27 years with the RHA, the past five as chief executive, Geoff is set to retire at the end of August (see page 1). He is leaving the association in excellent shape following one of the worst recessions this country has witnessed. During his time as chief executive, Geoff has always found a window in his extremely busy schedule to write for Freight Industry Times. I’m sure readers will look forward to Geoff’s final article for the RHA, which will appear in our Autumn edition.
I would like to take this opportunity to thank Geoff for providing such thought provoking articles, which have always addressed the major issues head on and championed the cause of the road haulage sector, and wish him well in the future.
For her part, Lesley Batchelor is a tireless advocate of UK businesses looking to maximise their presence on the international stage. Now, she has been recognised for her efforts and has been awarded an OBE in the Queen’s birthday honours list (see this page).
Indeed Lesley should be heartedly congratulated on receiving such a well-deserved accolade. Her articles in each edition of this publication reflect her overwhelming commitment to the IOE and those companies and individuals it supports and helps in their professional development.
By any measure, the rail freight industry has flourished since privatisation 20 years ago. The amount of freight carried by rail has increased by around two thirds, reversing the long-term decline. Significant investment in trains and track has improved services. And the network has become far more efficient.
Today the railway moves over a quarter of our containerised international trade to and from major ports. It carries the vast majority of aggregates for construction, and almost all of the coal for electricity generation. And it’s taking a rising share of the retail supply chain too. No wonder the regulator described rail freight as the most “transformed sector in the rail industry.”
The biggest challenge facing the industry is not how to stimulate growth. It’s how to accommodate growth. How to find space on an overcrowded network to diversify into new markets and take advantage of a recovering economy. While other countries have been building new capacity to meet future needs, Britain’s railway has been starved of funding for decades. Putting that right is a huge challenge, but it’s one we cannot afford to ignore.
So the government has made an unprecedented commitment to sort out the capacity crisis and modernise our railway. Around £38bn will be invested by Network Rail between 2014 and 2019 to run and expand the railway. Of that, we will spend about £9.4bn upgrading the network. Among the schemes to benefit rail freight will be the electrification of 850 miles of track, including an “Electric Spine” linking Yorkshire, the West Midlands, and ports on the south coast.
This investment will create capacity for freight to grow. But we are also making a significant commitment to rail freight over and above funding for the network as a whole. For example, we made £150m available through the Productivity Transport Innovation Fund to support schemes like the Nuneaton North Chord. The Strategic Freight Network is benefiting from £200m in ring-fenced funding up to 2014 and an additional £55m announced in the 2011 Autumn Statement, with another £200m to be invested up to 2019 in England and Wales, and £30m in Scotland.
Recent improvements to the network include the opening of the Felixstowe North terminal and London Gateway. In June we announced funding to electrify the Gospel Oak to Barking line, and national connections to Tilbury and London Gateway.
We are transferring more haulage from roads onto rail through our Mode Shift Revenue Support Grants. This scheme is helping to remove more than 800,000 lorry journeys from the road network each year. And in December, we published a draft National Networks National Policy Statement, including our plans for Strategic Rail Freight Interchanges. The long term fortunes of rail freight will be increasingly influenced by connections to the European mainland. So we will be participating in the European rail network for competitive freight.
This is an important development which will see the UK becoming part of a freight corridor linking the Netherlands, Belgium, France, Luxembourg and Switzerland. We are currently working on extending this corridor through the Channel Tunnel to London by November 2016. London provides a central hub from which freight can access the Strategic Freight Network for destinations throughout Great Britain. So the extension will provide better opportunities for operators and rail freight customers across the country to benefit from links to Europe. Subject to market studies, the corridor should be extended to the north by November 2018.
All these measures are urgently required. But they won’t provide the long-term transformation in capacity we need to meet rising demand for freight. Only a new North-South rail line will do that. As freight traffic has moved progressively into the intermodal market, the industry has increasingly used major arteries like the West Coast Main Line.
Today the West Coast line is the busiest mixed-use railway in Europe, supporting 12 different operators and carrying a quarter of all UK rail freight. Without major new capacity between the north and south, the West Coast line will be overwhelmed by the middle of the next decade.
HS2 will release huge capacity on the existing railway to expand and improve freight services. That will be good for freight operators, good for customers, and good for our economy.
It is clear that if we want a competitive economy, we need a competitive transport system to move goods around the country. While roads and aviation will still have an important role to play, rail freight offers a cleaner, and often more efficient and cost-effective solution to Britain’s needs.
That is why we are delivering the biggest rail modernisation programme for over a century; why we are firmly committed to HS2 to liberate capacity on the existing network; and why we are supporting the rail freight sector with additional investments and grants to encourage modal shift. Rail freight is a national asset – and this government is determined to exploit its full potential in the years ahead.
Rt. Hon. Patrick McLoughlin MP, Secretary of State for Transport
Those of you visiting the NEC Birmingham on 29th and 30th of April and the 1st of May are in for a treat. This year the Commercial Vehicle Show and Multimodal take place in different halls at the venue on those dates, so it is a great two-for-one experience for the sector.
Both events are free to attend and you can register online. This edition of Freight Industry Times includes reports on both gatherings which are totally independent of each other. Coverage will continue online and in our newsletters while the next edition will review the success of each event.
If you are attending the Commercial Vehicle Show you will find more than 400 exhibitors and a vast range of products, many of which are being displayed for the first time. A number of the vehicle manufacturers are unveiling their latest models during an action packed three days.
Now in its seventh year, Multimodal is seen as the key event for shippers and freight buyers. With close on 300 exhibitors there is plenty to see and the organisers predict that visitor numbers could exceed 6,000. Besides being an ideal networking event, Multimodal 2014 offers a full programme of seminars and masterclasses.
This year you can find Freight Industry Times at Multimodal 2014 on Stand 454. We hope you find time to come and see us – and you are sure to get a warm welcome.
Mike Parry, Editor
As many had predicted, in his Autumn Statement the Chancellor of the Exchequer announced the cancellation of the fuel duty rise scheduled for September 2014 and a freeze on any increase until May 2015 – the month of the next general election. George Osborne promoted the measure as helping motorists and businesses while the economy continues its recovery.
But for numerous commentators the measure falls short of expectations. FairFuelUK continues to reiterate that the UK has the highest fuel tax regime in the EU, and in his blog the campaign’s lead spokesperson Quentin Willson emphasises that the announcement does not go far enough and that the evidence presented by FairFuelUK shows that ‘a cut in fuel duty would in fact generate jobs, increase GDP and reduce inflation’. Quentin also points out that the Treasury has not refuted this evidence!
For the majority of hauliers fuel remains the most expensive element in their operational budget, so the fight to reduce fuel duty in real terms is set to continue up to and well beyond the next election. I am sure politicians of all the major parties will find Quentin and his colleagues formidable opponents in the run up to polling day.
Mike Parry, Editor