Despite the fact that it has been a challenging year for rail freight with the steep decline in coal traffic, the two key sectors acknowledged to have real potential - consumer and construction - continue to show consistent growth. Furthermore, there is considerable suppressed demand for services which can't be realised because of capacity limitations, so it is crucial that the Government continues to develop the Strategic Rail Freight Network.
Consumer traffic grew 7 per cent in the first quarter of the 2016-17 year, which is the highest level since 1998; and 4 per cent in the second quarter compared to corresponding quarters in the previous year. Overall, it has grown by 30 per cent in the last 10 years and is forecast to grow fourfold by 2043 - provided the network is upgraded and additional road/rail transfer points obtain planning permission. Construction traffic increased 2.2 per cent in quarter 1 and 8.3 per cent in quarter 2 against the previous year with that sector realising a 25 per cent increase since 2012.
However, the Government’s latest proposal to reform railways structures yet again give cause for concern. Rail freight is a nation-wide service with routes normally crossing several regional and route boundaries. So giving more operational control to the train operating companies could marginalise rail freight. Unless there is a framework which encourages the development of integrated franchises to support rail freight growth, it could get left sitting in loops and at red signals.
Freight needs the national system operator to retain responsibility for timetabling, capacity management and co-ordination of engineering works. Therefore, it is crucial that the Network Rail’s Freight Route has appropriate status and powers.
Good Strategic Rail Freight Interchanges (SRFIs) are key to shifting more freight to rail as they reduce the so-called "transhipment" costs, those of moving cargo between the modes, such as from train to van as part of the journey, and can reduce the distance at which rail becomes competitive with other modes. For example, Daventry SRFI removes 23 million lorry miles per year largely from motorways and A-roads. Developers want to invest in SRFIs as the growing number of proposals for new ones such as East Midlands Airport, Etwall Common near Derby, and Four Ashes near Stafford demonstrate. I-Port including a rail freight terminal at Doncaster is under construction.
Congestion, air pollution and increased attention on cycling safety are changing urban logistics policies. It is important that key city authorities understand that rail can offer the long distance trunk haulage element of consumer urban deliveries for onward transhipment into low emissions vehicles. To achieve this, consolidation centres and terminals must be connected to rail networks. Similarly more aggregates terminals are needed in our major cities to facilitate the greater use of rail for construction projects.
So Freight on Rail is broadcasting this message loud and clear, and relating it to the need to build more housing with the simple statistic that each train can carry enough materials to build 30 houses. I continue to make the case for affordable rail freight access charges emphasising how rail freight must be compensated for the market distortion which sees HGVs only pay 30 per cent of the costs they impose on society. All these points will be high on my agenda when I meet the Rail Minister in February.