1. TfN Freight & Logistics Strategy Chris Rowland Freight in the City Conference, Manchester, 3 March 2016 C Rowland MDST presentation

2. Context: the Northern Powerhouse & TfN The Northern Powerhouse: –Objective of closing the productivity gap –Transport & broadband infrastructure –Science, innovation, training & skills –Devolution of powers to city regions Transport for the North (TfN) New pan-North transport body, to become statutory body in 2017 Enhancing the North’s connectivity, network capacity & resilience Facilitating (passenger) agglomeration

3. Draft TfN Freight & Logistics Strategy DRAFT - consultants’ recommendations Working in partnership with Mott Macdonald First ever pan-regional freight study in the UK Looking at how freight and logistics can contribute to transformational economic growth in the North Timescale of 2033 (and 2043…) Public sector strategy…for a private sector industry?

4. The political economy of freight transport Freight and logistics industry: –owned and operated by the private sector –enabler of transformational growth, serving the northern economy –invests in its own infrastructure & equipment Highly competitive, sensitive to changes in the policy & regulatory environment Appropriate public sector interventions will lead to response from private sector – working with the market to achieve public benefits Private sector needs clear, consistent, harmonised business environment for investment – requires long term strategy Shared vision required

5. Approach

6. Baseline: strengths & constraints Cluster of population centres Distribution activity Energy, manufacturing, extractive industries Ports - with rail & inland waterway connections Lack of capacity: rail & road Peripheral compared to ‘golden triangle’ Fragmented land use planning framework

7. Selecting the interventions Grounded in current reality Transformational Local concerns International opportunities Economy Environment Measures only in North National measures Public investment Private investment

8. Draft Freight & Logistics Strategy (1) “Maximise the efficiency of the movement of goods to, from and within the North of England to contribute to the transformation of the economy of the Northern Powerhouse”. Focus on rail and waterborne transport to: –Reduce the cost of transporting freight within, to and from the North –Make peripherality a virtue (longer distances) –Secure environmental benefits –Create additional employment & GVA (mainly in distribution centres) –Improves access to more remote areas of North Also includes a range of highways interventions Provide cost-effective access to the North, making it more attractive to manufacturing industry & inward investors

9. Draft Freight & Logistics Strategy (2) Achieved through public sector interventions to enable the private sector to reduce costs and generate significant public benefits: –Making rail network capacity available ahead of demand –Growth of network of Multimodal Distribution Parks (MDPs) –Improved connectivity to ports, mainly by sea & rail –Targeted investment in highways network Integrated ‘package’

10. Impact of strategy & public sector interventions: MDPs Chain of MDPs across the North (RDCs & NDCs) Mainly on edge of large population centres Also capitalising on proximity to air freight services Facilitated by public sector: –Providing favourable planning environment –Ensuring rail freight capacity available ahead of demand –Investing (where necessary) in rail connections

11. Impact of strategy & public sector interventions: rail freight capacity 34 million tonnes of additional rail freight traffic in 2033 Mainly North-South, but also East-West to gain access to MDPs Facilitated by public sector securing paths for freight ahead of demand

12. Impact of strategy & public sector interventions: maritime Growth in Northern ports’ traffic due to: Larger ships on northern routes Deep-sea service development Switch to LNG (Liquid Natural Gas) Facilitated by public sector investing in: –Improved road & rail access schemes for ports –Adequate capacity in hinterland road & rail networks –Facilitating network of MDPs –LNG bunkering infrastructure

13. Impact of strategy & public sector interventions: highways Cut in HGV kms nationally, but tonnes by road rises marginally in the North Increase in traffic on east- west links Facilitated by public sector investing in: –Improved road & rail access schemes for ports –Additional capacity on M60 NW Quadrant –Others strategic schemes provide benefits (e.g. A66/A69)

14. Summary of public interventions & resulting private investment Public sector interventions Investment in additional capacity for rail freight - capacity ahead of demand Targeted investment in road enhancements: M60 NW Quadrant & access to ports Strategic land use planning for network of MDPs Potential investment in: –rail access for MDPs –LNG infrastructure at ports Private sector response Invests in network of MDPs Ships international freight by sea direct to North Transports unitised traffic by rail on North-South axis Invests in locomotives, wagons, HGVs Shipping industry invests in larger, LNG-powered ferries

15. Public sector benefits = potential funding Present value £billion Reduced user costs (efficiency):£16.2 Reduced environmental costs: £3.5 Reduced congestion/accidents:£16.0 Net taxation less infrastructure savings:(£3.5) Expand employment:£19.0 ___ Total£51.2 Benefits distributed across the North – and across the UK

16. ‘Last mile’ distribution Poor air quality is a key issue in city centres Will the technology deliver on emissions? Will additional economic activity due to Northern Powerhouse be limited by air quality cap? Should the freight industry be required to make ‘last mile’ deliveries using low emission vehicles? Concepts such as consolidation & deliveries by electric vehicles add cost, but industry would be contributing to a unique, higher quality environment in the North Must be based on a harmonised regulatory framework across the North

17. Implications for industry Distribution: –More investment in distribution centres on MDPs –NDCs as well as RDCs, with pan-Northern potential Rail freight: –Intermodal for North-South flows to serve MDPs Shipping & ports: expansion of services, terminals & port-centric distribution Road haulage: –More capacity east-west –More focus on intra-North rather than long distance Adapting to low emission ‘last mile’ deliveries in city centres More opportunities to: –Serve existing customers more cost-effectively –Expand market by serving new opportunities

18. Thank you! chris.rowland@mdst.co.uk