Rail freight industry is on track to target growth - Martin Bignell

Every five years the priorities for investment by Network Rail are determined by the setting out of a High Level Output Statement (HLOS) by its funders. In Scotland this is Transport Scotland. This statement includes what the Scottish Ministers require the railway industry to achieve during the next ‘Control Period’. Usually shortened to ‘CP’, the current CP6 ends on 31 March 2024 and CP7 then runs until 31 March 2029.

The HLOS ensures that Government’s priorities are reflected in decisions made by the industry. Inclusion of specific outcomes for rail freight is therefore critical to giving our industry confidence to invest and, perhaps more subtly, for end customers to respond to a clear alignment of policy and long-term network planning. The HLOS for CP6 included for the first time a target to grow rail freight. The HLOS published by Transport Scotland on 3 February 2023 requires the industry to achieve a further 8.7 per cent growth in net tonne km during CP7. Rail freight growth target setting is an area where Scotland has led the industry. South of the border, Great British Railways is currently developing its first growth target.

Neither Transport Scotland nor Network Rail can deliver this growth directly of course. Freight operating companies are wholly commercial organisations, as are their customers. They compete for business with each other and with road and maritime alternatives. The effectiveness of a target is that decisions are made with a view to their positive benefits to rail freight. Will an investment allow rail freight operators to run their services more efficiently and therefore more competitively? Could incremental improvements be made to schemes that would bring benefit to rail freight customers? Are infrastructure plans enabling freight operators to reduce the carbon footprint of their operations; a question increasingly asked by rail freight customers when looking at their extended supply chains.

Targets also ensure that progress is measured and what’s measured tends to be what’s managed. Are average speeds improving? Is rail freight performance improving? Are delays and disruptions attributed to infrastructure issues reducing? All factors that enable the operators themselves to be more reliable, more competitive and more attractive for new business.

Martin Bignell, Scottish and Northern Representative, Rail Freight Group

Within Scotland the target has embedded a collaborative culture across the rail freight industry as it’s in everyone’s interest to work together to achieve growth. CP7 requires the development of a longer-term rail freight growth strategy by about 2026, building on plans developed collaboratively by our industry and published in 2019.

It’s reasonable to assume that cross-border rail freight, already a success story, will continue to grow. It’s an established market with significant large scale end customers driving demand and taps into the growing network of strategic rail freight terminal capacity in distribution hubs and ports across the UK. Ensuring sufficient rail freight terminal capacity in Scotland and rail network capacity on the East and West Coast main lines may be the greater challenge. But a very significant Scottish domestic freight market exists barely touched by rail freight. Making meaningful inroads into that during CP7 arguably would be the greater prize and one it’s hoped will continue to be supported by our new Transport Minister Kevin Stewart and Cabinet Secretary Màiri McAllan.

Martin Bignell, Scottish and Northern Representative, Rail Freight Group