Chapter 8 - Freight: moving goods more efficiently CM 6234

Efficient freight transport is essential to our economy and to our prosperity. In turn, economic growth increases demand for goods and therefore for their transportation - locally, nationally and internationally. Goods need to be moved freely, reliably and efficiently, while minimising the impact on safety, the environment and other transport users.

The challenge

8.1 With continuing economic growth, and a projected growth in both population and households, our demand for goods is likely to increase over the next 20 to 30 years. This will lead to increased demand for the movement of goods. Although the freight transport industry will continue to respond with more efficient ways of operating, the challenge will be to accommodate this demand in a way that is acceptable to society.

Long-term trends in goods moved by transport mode, 1980-2002

Where we want to be

8.2 The Government's key aims for the freight industry are to facilitate the continuing development of a competitive and efficient freight sector, while reducing the impact that moving freight has on congestion and the environment.

8.3 We need reliable routes for moving goods to consumers and businesses. We need proportionate regulation and enforcement which protects society without stifling business, and a continuing partnership with industry to exploit the potential for more efficient logistics.

8.4 Where Government helps fund more sustainable transport practices, we need to ensure best value for money. We intend to start assessing modal shift programmes alongside other options, such as encouraging more efficient road-based operations. This could mean a change to the current allocation of resources between these programmes.

What we have achieved

8.5 Our policies have focused on:

• measures to tackle road congestion which benefit all road users (see Chapter 3);
• taxation policies that encourage more environmentally-friendly operations, such as lower vehicle excise duty for hauliers who meet higher emission standards;
• regulation where necessary to minimise safety and environmental risks from road freight transport in particular. Much of this regulation is set at the European level;
• Promoting best practice, training and other measures to help the transport industry improve its efficiency and reduce negative impacts;
• active engagement with the rail freight industry to promote freight on rail, supported by targeted investment;
• measures to encourage a transfer of freight from road to sea and inland waterways; and
• otherwise leaving the freight transport industry to get on with providing an efficient service to consumers and business.

8.6 These measures are establishing a sound framework within which the industry can improve the efficiency of its operations. British logistics companies are world leaders. Specific interventions, both nationally and through the European Union, have significantly improved the environmental performance of road freight transport, especially in relation to local pollutants. Our research and best practice programmes have identified many examples of good operational practice which not only provide cost savings for the businesses concerned but also offer safety and environmental benefits. And modal shift policies have succeeded in taking lorries off the roads.

What we are going to do next

8.7 For many years freight policy has tended to consider the individual forms of transport separately. We signalled a move away from this approach in our 1999 document Sustainable Distribution: a strategy(1), and will continue in that direction.

8.8 Businesses see freight transport as just one part of an overall logistics operation which also considers where goods are sourced and stored. Businesses have different logistics models and it is Government's role to provide a policy which complements their decisions while minimising the negative impacts of freight movement on safety, the environment and congestion. The Government's policies should not be guided by attachment to particular forms of transport, but by the approach that offers the best value for money to deliver the best outcomes for our economy, society and the environment.

8.9 Our strategy to achieve more sustainable distribution of goods comprises the following elements.

• Access to infrastructure - the measures described in Chapter 3 to benefit road users and improve journey reliability will help freight transport as well as private motorists. Rail freight operators will be given greater certainty about their rights on the existing network, and a group of key rail routes will be identified on which freight will enjoy and pay for more assured rights of access.
• National and international regulation - we will continue to regulate where necessary to minimise the impacts of road freight transport in particular on safety and the environment. In international negotiations we will seek to ensure that any new regulation is proportionate. We will also streamline domestic regulation, and will take forward our plans to introduce less bureaucratic arrangements for operator licensing.
• Local and regional regulation - we will encourage local authorities to consider how their various regulatory powers that relate to freight transport (traffic and parking regulations, night-time bans, planning powers and the use of planning conditions) can be co-ordinated to make life easier for businesses while protecting the interests of local people. Freight policy also needs to be considered by regional bodies and we will encourage them to think strategically about freight, especially in the context of regional strategies on transport, housing and spatial development.
• Enforcement - regulation needs to be enforced with fairness, transparency, proportionality and speed. We will take forward our proposals to introduce a graduated fixed-penalty scheme for road traffic infringements, and a deposit scheme to ensure offending overseas hauliers do not escape penalties as is often the case now. We will seek the necessary enabling powers when parliamentary time allows.
• Best practice - we will continue our programme of best practice research and dissemination. This will cover all forms of freight transport but, as road transport dominates, the scope for efficiencies is clearly greatest here. In the past few years we have helped take best practice directly to operators. In the future we will look for this to be done on an increasingly commercial basis.
• Modal-shift programmes - rail and water. We will continue to encourage freight traffic to be shifted from road to rail or water where this makes sense, and where appropriate we will offer financial support.
• Taxation of the haulage industry - we are pressing ahead to deliver lorry road user charging by 2007-08. A new distance-based charge which will apply to all lorries using UK roads. This will ensure that all hauliers make a fair contribution towards the costs of using the UK road network.
• Technologies such as satellite tracking and Radio Frequency Identification chips provide information about the location of the vehicle or its cargo. This allows freight operators to be more efficient - reducing mileage, operational costs and fuel consumption. The industry will drive the uptake of these technologies, but we will carry out research and promote best practice where appropriate. And we will be examining the scope for freely accessible electronic information about the road network, such as speed limits or height and width restrictions, to allow better journey planning and safer driving.

Getting best value for money

8.10 Through our financial interventions we seek to mitigate the impact of freight transport on safety, congestion and the environment. In the past we have run separate programmes to support transfer of freight traffic to rail and water, and to support more efficient operating practices for road haulage. These are all different ways of achieving similar objectives. For example, lorry miles can be saved by transferring traffic to other modes and by using lorry fleets more efficiently. Pollution can be reduced by moving goods by rail or water, and by training lorry drivers to drive in a more fuel-efficient way.

8.11 We need to use limited resources to best effect. We will therefore be moving towards prioritisation of funds from these programmes according to the benefits of individual projects. We are developing a range of freight indicators to ensure that our policies are working. This will help to establish the impact of our policies and to identify where further action may be justified.

Conclusion

8.12 The Government is committed to supporting industry by helping to ensure that goods can be moved freely, reliably and efficiently. The strategy outlined in this document will provide a framework within which the freight industry can continue to underpin our economic prosperity.

(1) First published by the Department for the Environment, Transport and the Regions, March 1999. Available at www.dft.gov.uk