Trust in industry to take the lead, FTA urges Hammond

Thursday 15 July 2010

The Freight Transport Association (FTA) has set out where it thinks government should be directing its future transport spending and how industry-led initiatives can be trusted to achieve greater results.

In a letter to Transport Secretary Philip Hammond, the leading trade body underpinned the value of infrastructure investment to the UK’s economic recovery and urged him to consider more closely using existing industry-driven initiatives in the best interests of UK PLC.

FTA’s CEO, Theo de Pencier, said:

“As economic activity begins to grow so to will levels of congestion and, with it, unreliability. Investment in transport schemes has been proven to yield very impressive returns, in some cases achieving ratios of £8 for every £1 spent by government.

“Signs indicate that freight activity is on the rise again and we need a transport network that is fit for purpose otherwise the cost to the economy could be enormous: the Eddington Transport Study estimated that increasing congestion in England alone could leave a £25 billion hole in the coffers every year well into the 2020s.”

Encouragingly, in his emergency budget statement on 22 June, the Chancellor re-affirmed that well judged capital spending by government provides the new infrastructure needed to compete in the world economy. George Osborne also identified the mistake made in the recession of the early 1990s when the then government cut capital spending too much.

de Pencier concluded:

“We are pleased that the government recognises that cutting capital spending on infrastructure can be counter productive when the economy is in dire straits – if the public purse is not an option then perhaps private sector funding can provide the answer for much-needed transport infrastructure investment.

“Equally, industry’s role in delivering a brighter future must not be undervalued. From accreditation to best practice delivery, from sensible self-regulation to administering testing and licence issues, there is much that FTA and others could do more cheaply and more efficiently than government.”


Notes for editors

FTA identified in its letter to Philip Hammond the four overriding principles should be at the heart of future transport spending decision:

1. Be guided by the Eddington Transport Study – Published in December 2006 it concluded that there is a key challenge to improve the performance of the existing network. It also highlighted the need to invest where there is an attractive economic return.
2. Recognise the long lead times associated with transport schemes – Multimodal freight activity is slow to rise, but rise it will and it is therefore essential to maintain the current momentum of transport infrastructure improvements.
3. Find new sources of finance – The use of private money has worked well overall in the commercial development of the UK’s deep sea port infrastructure, airports and, of course, in fuding the railway network through Network Rail. If government cannot find the public finance to make progress on improving transport infrastructure in the medium term, the role of private funding must be considered
4. Let logistics take the initiative – Three excellent examples of how FTA is developing initiatives to improve the supply chain’s environmental and economic performance:

• The Logistics Carbon Reduction Scheme – to create a target-based voluntary agreement to reduce CO2 emissions for the UK freight sector.
• Night time deliveries – FTA has been working with the Noise Abatement Society and DfT to create a local planning framework which creates the appropriate conditions for quiet deliveries to stores at night.
• Rail freight – FTA’s FastTrack service has been launched to make rail freight more accessible to new entrants onto the market.

For further information please contact FTA’s media team on 01892 552255/01892 552253 or, out of hours, on 07818 450425


FTA Press Office

01892 552255