Delivering the Goods: Scotland's Rail Freight Strategy

DELIVERING THE GOODS Scotland’s rail freight strategy

1. Message from the 5.1 Innovation p08-09 Transport Minister p02 5.2 Facilitation p10-12 2. Rail freight strategy framework p03 5.3 Promotion p13-14

3. Rail freight – delivering 5.4 Investment p15-16 the goods for Scotland p04-05 6. Measuring success p17 4. Gathering views p06 7. Impact assessments p17 5. Bringing the rail freight strategy to life p07 8. Summary of actions p18 9. Glossary p19 1. Message from the Transport Minister 02

In 1840, ‘railway time’ was the first recorded occasion when different local times in the UK were synchronised and a single standard time applied.

Almost two centuries later, time is of We will galvanise efforts to overcome the essence for the Scottish rail freight the technical, cultural and regulatory industry. That is the loud and clear challenges towards a ‘can do’ approach, message that I have taken from the with the needs of the rail freight many responses we have received to customers at its heart. We will invest, our consultation on a rail freight strategy along with the industry, in the whole for Scotland. system solutions and innovations which can meet the demands of the modern Whilst changing economics of power market, for the benefit of Scotland’s generation and environmental legislation economy, its environment and its were predicted to reduce the production communities. and movement of coal by rail, the rapidity and severity in the decline is Back onto the subject of time, now is a clearly beyond expectations. During the time for action. Not Scottish Government consultation period, we also received action, not rail industry action, but joint the devastating news about the Dalzell action. By delivering this rail freight and Clydebridge steel plants, which was strategy in partnership, I am confident not just a body blow for the Scottish that we can create the conditions for a steel industry and our local communities, sustainable, high quality, highly efficient but also the rail freight industry, which rail freight industry that Scotland needs, moved materials to the Dalzell plant for wants and deserves. production.

The reality is that we need to work together to place our rail freight industry onto a sustainable footing. That is the immediate to medium term focus of Derek Mackay MSP this rail freight strategy. We will work Minister for Transport & Islands alongside the industry to identify new Scottish Government markets and areas for growth.

Front cover image © Paul Scott of Network Rail New £4.5m aqueduct at Carmuirs, part funded by the Strategic Rail Freight Investment Fund to provide W12 gauge clearance The image on this page © Network Rail 2. Rail freight strategy framework 03 2. RAIL FREIGHT STRATEGY FRAMEWORK The purpose of the Scottish Government and its partners is to make Scotland a more successful country, with opportunities for all to flourish, through increasing sustainable economic growth. Scotland’s Economic Strategy focuses on the two mutually supportive goals of increasing competitiveness and tackling inequality and our approach to delivering this is underpinned by four priorities for sustainable growth: investment, innovation, inclusive growth and internationalisation. © Frank Roach, Hitrans

National Transport Strategy Our vision for rail freight Realising the Vision – Critical success factors A safe, efficient, effective and The Scottish Government’s vision four levers for success • A sustainable rail freight industry, sustainable transport system, is for a competitive, sustainable with identifiable growth potential for both passengers and freight, rail freight sector playing an Innovation over time. is a key enabler of sustainable increasing role in Scotland’s New, efficient ways PURPOSE • Creating increased opportunities economic growth. It supports economic growth by providing a of delivering. for Scottish exports. PURPOSE businesses in achieving their safer, greener and more efficient local, national and international way of transporting products Facilitation • Longer, faster, greener objectives and improves the lives and materials. Building strong, lasting freight trains. Increasing growth and of individuals and communities partnerships. • A high performing, resilient, tackling COMPETITIVENESS TACKLING INEQUALITY inequality are by connecting them with their strategic freight network for mutually supportive economic future. The strategy will Promotion Scotland, fully aligned with be delivered through 3 Strategic Showcasing the benefits cross-border flows. Outcomes: improved journey of using rail freight. • Strong partnerships across Investment Innovation Inclusive growth Internationalisation times and connections; reduced the industry, focussing on doing emissions; and improved quality, Investment the right things for customers. accessibility and affordability. Maximum return for whole • High value returns on public system investment. and private investments. 3. Rail freight, delivering the goods for Scotland 04

Under Scotland’s Economic The three Key Strategic • Maintain and improve Strategy3, the Scottish Outcomes are: the accessibility of rural Government’s overall purpose • Improved journey times and and remote areas. 3. RAIL is to increase sustainable connections between our • Minimise the adverse impact economic growth. A safe, cities and towns and our of freight movements on the efficient, effective and global markets to tackle environment in particular sustainable transport system, congestion and lack of through the reduction in for both passengers and integration and connections emissions and noise. FREIGHT freight, remains one of the key in transport. • Ensure freight transport enablers of such sustainable • Reduced emissions to tackle policy integration. economic growth. It supports climate change, air quality DELIVERING THE GOODS businesses in achieving their and health improvement. local, national and international Rail Freight Strategy FOR SCOTLAND objectives and improves • Improved quality, accessibility This Rail Freight Strategy is the lives of individuals and and affordability of transport, underpinned by the vision communities by connecting to give choice of public and outcomes within the NTS. them with their economic future. transport, better quality It shares the same objectives services and value for money, as the National Freight Strategy. The National Planning or alternative to car. However, it is distinct in two When asked about railways, our While largely unseen by most, Framework 3 is Scotland’s main ways: The NTS was first published thoughts almost immediately rail freight is all around us and statutory long term spatial • It seeks to address the in 2006 and recently refreshed, turn to the commuter heading it plays a critical role in development strategy. It is pressing market challenges and the above outcomes into work, the businesswoman Scotland’s economy. A recent Rail freight is all the spatial expression of faced by the rail freight remain valid. However the travelling to an important report jointly commissioned around us and it our Economic Strategy and industry due to the decline challenges ahead and the meeting, the couple heading to by the Scottish Government identifies key ambitions and of the dominant, traditional 1 plays a critical role in Government’s changed ways of London for a romantic weekend and the Rail Delivery Group opportunities for Scotland, markets of coal and steel. or the family heading ‘doon the highlighted rail contributing Scotland’s economy including through our rail working warrant a deeper look • It reflects the regulated watter’ for a day on Troon beach. up to £670m in Gross Value freight networks. in the form of a recommended Added annually to Scotland’s fuller, collaborative review of nature of the industry and the opportunities and But go to your local economy, supporting up to The National Transport the NTS in the next Scottish challenges of a fixed network supermarket and many of the 13,000 jobs and facilitating Strategy (NTS) provides the Parliamentary term. with defined rights of use everyday essentials you buy will up to a further £650m in framework for enhancing our and associated charging have travelled at some point on wider economic benefits. transport system, in response Overarching National mechanisms. a train. Added to that, the new The rail freight sector is a key to the main transport challenges Freight Strategy jacket, the shiny new car, the component of these figures. that Scotland faces, which in turn Embedded within the NTS is Role of rail freight - diesel for that car, the concrete contributes to improvement in the Freight Strategy, covering economic growth slabs for the patio, the wee nip The Scottish Government our economic, environmental all modes, which ensures A vibrant rail freight sector can of whisky at New Year to go has for some time recognised and social performance. that the overall priorities for play a vital role in supporting with the shortbread, the bottle the value of the sector and In particular, the three Key freight transport infrastructure Scotland’s economic strategy of water: all may have at some that is why we have made Strategic Outcomes continue to investment are aligned. through increased exports point been loaded onto record levels of investment in be used as the guiding principles The objectives for the Freight overseas and the efficient a freight train. Scotland’s railways - over £6bn at national, regional and local Strategy are: movement of goods across since 2007 with a further £5bn level when developing strategy • Enhance Scotland’s Scotland and the UK. It can earmarked until 2019. and prioritising resources. competitiveness. help businesses of all sizes to • Support the development grow existing markets and of the freight industry in 1 www.raildeliverygroup.com/files/Publications/2016-03_contribution_of_rail_to_scottish_economy.pdf explore new ones. 2 ‘National Transport Strategy’, Transport Scotland, 21st January 2016 Scotland. 3 www.gov.scot/Topics/Economy/EconomicStrategy 3. Rail freight, delivering the goods for Scotland 05

Role of rail freight - Role of rail freight - Network Rail’s 2013 freight The strategy is based on a • The Scottish and UK supporting stronger, internationalisation market study8, predicted wide ranging discussion with Government must work safer communities A rail freight industry with a considerable growth by 2043. the industry and stakeholders. together to ensure that public People and communities proven track record of moving However, this study could not Among the strongest feedback investment in rail freight, rely on rail freight. It is part goods safely, securely and have envisaged the severity we have received during the and their connections to of our everyday lives efficiently can help to create and rapidity of the decline of consultation period is that: other modes, are completely delivering mail, parcels, the underlying conditions the dominant markets. Future • The rail freight strategy aligned. This would ensure goods and consumables which make Scotland an projections by Network Rail should look to galvanise that the fluidity of cross- for shops and supermarkets, attractive place to invest. and its rail industry partners efforts in the short to medium border flows are maximised, and an efficient rail freight It can help the Scottish will be set against a baseline term towards filling the gap increasing the opportunities industry can play a part in economy strengthen its links which accounts for the market left by the coal and steel for trade across GB and with with the global economy conditions post the reductions the international markets. keeping consumer prices markets. If rail freight can and promote Scotland’s in coal and steel. 76 lower. Rail freight can also stabilise, sustained growth • Rail freight cannot always international brand. improve safety and reduce may be possible in the deliver a door to door Each freight Meeting the challenges - longer term. service. Therefore, while the congestion, with each freight Challenging market a rail freight strategy for train removes • There is no single, large economic, environmental train removing up to 76 conditions Scotland 4 market waiting to fill the gap and safety benefits of greater up to 76 heavy heavy goods vehicles While we see a key enabling Given these challenging left by coal. Rather, the future mode share for rail freight goods vehicles from the roads. role for rail freight in supporting conditions, we took the view for the industry in Scotland are recognised, this has to Scotland’s economy and our that now was the right time to from the road. is likely to be around a range be seen in the context of Role of rail freight - communities, we are faced develop a rail freight strategy of smaller markets, either on the broader logistics chain. tackling climate change with the reality of the decline which would look to galvanise the basis of commodity or • While recognising that safety Per tonne of cargo rail freight in the dominant Scottish rail the actions of the rail freight geography. In this context, the is a major driver behind the produces 76% less carbon freight markets – coal and industry, its customers and ability to remove the barriers Scottish Government’s roads dioxide5 than road freight. steel – which has been far partners, including the to innovation and market investment programme, there Rail freight emits less than quicker and more severe than Scottish Government. entry are critical. was a view expressed that one tenth of the nitrogen predicted. For so long these rail investment should keep oxide and fine particulates were the cornerstone of our • In order to access and service pace with road investment of road haulage per tonne. rail freight market in Scotland, new markets, the rail freight to create a Scottish freight A shift from road freight to rail, providing the firm footing to industry has to be nimble, ‘corridor’ with good access where this is viable, can help allow operators to speculate responsive and proactively from rail to the strategic the Scottish Government meet in other markets. There is also seek new opportunities. 76% road network. Also of critical its commitment to tackling the reality that this decline in While recognising importance is a joined up Per tonne climate change. It will also core commodities has not been competition and commercial approach to rail access at of cargo, rail align with EU targets for modal matched by market growth in interests, it must look towards ports and harbours, shift from road to rail (and other areas, such as intermodal greater collaboration, both freight produces in particular to support waterways) of 30% by 2030 traffic. This means that by within the rail freight industry Scottish exports. 76% less carbon and 50% by 2050 for distances the time that Longannet and with wider stakeholders dioxide than greater than 300 kilometres6. power station closes later in the delivery of services, road freight. this month, there may be a where this is to the overall significant gap in the rail freight benefit of the customer. market in Scotland, potentially somewhere in the region of 50 to 70%7. 4 www.raildeliverygroup.com/files/Publications/2014-05_keeping_the_lights_on.pdf 5 www.raildeliverygroup.com/files/Publications/2014-05_keeping_the_lights_on.pdf 6 ec.europa.eu/transport/themes/strategies/2011_white_paper_en.htm 7 These figures are based on discussions with the industry as part of the consultation process. 8 ‘Long Term Planning Process: Freight Market Study’, Network Rail, October 2013 4. Gathering views 06 4. GATHERING VIEWS

Through the consultation process, we have gathered views in a number of ways: • We have received 46 responses to our consultation, which ran from 22 October until the 22 January. • We held seven stakeholder workshops in Coatbridge, Grangemouth, Glasgow Aberdeen, Inverness and London (two). Over 20 organisations attended with a wide spread of interests, including representative bodies, private companies and public sector bodies. • We had a number of bilateral discussions with organisations and individuals.

Alongside the strategy we will publish: • An analysis of the consultation responses. • The full consultation responses, where we have permission from the respondent. • A note of the discussions at stakeholder events. 5. Bringing the rail freight strategy to life 07

A desire to tackle the Having considered everything Promotion challenges of the loss of that the rail freight industry and • Promoting the benefits wider stakeholders have told us the dominant markets, of using rail freight through 5. BRINGING through the consultation, along targeted information and taking the action with the data and analysis that campaigns. we have gathered, the following necessary to enable the • Providing easy to access chapters outline a suite of rail freight industry to seek information to help current proposed actions which will and potential rail freight users THE RAIL and fully embrace new bring the rail freight strategy to plan their logistics needs. market opportunities, is life. These are centred around the four key levers for success: the platform upon which Investment this rail freight strategy FREIGHT Innovation • Creating the right is built. But the Scottish environment for a targeted, • Examining the barriers to whole industry approach to Government cannot market entry. deliver this alone. It will investment which enables • Proactively identifying new rail freight’s potential for STRATEGY require a willingness and markets and opportunities growth and maximises its concerted effort from all for pilot initiatives. contribution to Scotland’s who have an interest in the • Fostering a ‘can do’ attitude economy. success of the rail freight towards resolving technical, • Providing certainty in the long TO LIFE regulatory and engineering term investment programme, industry. It requires joint challenges. encouraging third parties action, commitment and to also invest in rail freight investment. Facilitation services and facilities. • A co-ordinated approach • Complete alignment to ensuring the efficient use between the Scottish and and availability of the Scottish UK Governments on cross- network, which will help to border investments, with support market entry for a focus on supporting rail freight. Scottish exports. • Ensuring alignment on the opportunities and challenges for cross-border flows. • A regulatory framework which incentivises growth.

Supporting new ways The Control Period 5 (CP5) proactively seek new freight One of the four priorities within The Scottish Government This need not be focussed of working investment programme traffic with a range of technical, the Scottish Government’s cannot lead the way on rail on infrastructure development The Scottish rail industry is presenting engineering regulatory and engineering economic strategy is to foster freight innovation – it is a – we want to take a whole is undoubtedly in a period challenges which require new challenges identified as key a culture of innovation and matter for the rail freight system approach to public of change. The Bowe9 and approaches towards delivery, constraints. research and development. industry, where the expertise investment which will help Hendy10 reviews reported for example in the roll out of resides. However, we can use to achieve greater efficiency at the end of last year whilst our electrification programme. Particular issues identified This is essential to enable our position as the main funder and true value for money. the Shaw Review11 on the While through Digital Railways, include: Scotland’s business sectors of Scotland’s railways to drive future structure and financing we are getting a glimpse of • A rigid, one-size fits all and industries to optimise the cultural and behavioural Actions of Network Rail reported its the technological future of approach to resolving issues their potential for growth and change necessary to make sure recommendations last week the industry. around interoperability and efficiency in supplying high that the industry in Scotland and the UK Department group standards, rather quality products. Scotland has has a ‘can do’ response to new for Transport set out its Taken together, the time has than a proactive, risk based a long-standing reputation for ideas and innovative solutions. statement on the future role never been better for the approach. innovation and we think that the of the Office of Road and industry to make a step change • Lengthy regulatory and Scottish rail freight industry, with We can also consider the Rail (ORR)12. The Scottish in its approach to innovation. railway planning processes. the right support and approach, potential for financial support, Government will carefully However, a common theme This meant that the length involving partners across the subject to state aid rules and consider the conclusions and that has emerged through both of time taken to move from industry and beyond, can be the availability of Government recommendations from each the consultation responses idea to testing to delivery at the leading edge of railway finance, where the business case of these. At a structural level, and stakeholder sessions could potentially lead to innovation. For example, looking has demonstrated particular Scottish Ministers welcome any was the range of barriers, missed market opportunities at smarter ways of loading and potential for sustainable market strengthening of responsibilities often regulatory and cultural, and undermine rail’s ability moving commodities, such growth and where the broader and control of decision-making affecting the exploration of new to respond to fluid freight as timber, which can often be benefits to Scotland’s economic to Scotland but will continue opportunities for rail freight. markets. Most concerning found immediately adjacent growth, and wider policy to pursue options for the full was a perception that, as to the rail network. objectives are clear. devolution of Network Rail in There was a perception a consequence of this, a number of industries simply 9 www.gov.uk/government/publications/bowe-review-into-the-planning-of-network-rails-enhancements-programme-2014-to-2019 Scotland and whole system amongst some respondents 10 www.gov.uk/government/publications/sir-peter-hendys-re-plan-on-resetting-network-rails-enhancements-programme-2014-to-2019- accountability to the Scottish that parts of the railway did not consider moving government-response were not fully incentivised to goods by rail as an option. 11 www.gov.uk/government/publications/shaw-report-final-report-and-recommendations Parliament. 12 www.parliament.uk/business/publications/written-questions-answers-statements/written-statement/Commons/2016-03-17/HCWS624/ 5.1 Innovation actions 09

Innovation ACTIONS

The Scotland Freight Joint The Board will produce a report Two very specific proposals Board will consider the barriers on its conclusions by the end have emerged through to innovation and attracting of July 2016. stakeholder discussions: new freight onto the railway • We will establish a short-life network and how these can As part of the industry planning working group, chaired by be overcome. The Board will process, the rail freight industry Transport Scotland and to use, among other things, the should provide advice to the include Abellio ScotRail and evidence from the ‘Lifting the Scottish Government through cross-border operators, to spirit’13 trial and the ‘Branchliner’ the Scottish Initial Industry Plan consider opportunities for initiative as a basis to identify (or equivalent), due in Autumn moving low bulk goods areas for positive action. Areas 2016, on the establishment and parcels on passenger for consideration will include: of a ring-fenced rail freight services. The group will • Behaviour and culture. innovation fund for Control report by the end of Period 6 (CP6). The fund January 2017. • Regulation and standards. should have a particular focus • The Scotland Freight Joint • Barriers to market entry. on facilitating a whole system Board will commission a • Moving joint loads. approach to investment study on the potential for • Network capability, particularly in rail freight innovation. an ‘urban freight network’, for containerised traffic. Any investment should be through the use of existing underpinned by a robust and parts of the network to deliver • Export potential, in particular sustainable business case goods to and between the through the ports and direct centre of cities and large services via the Channel which clearly articulates the towns. The potential for Tunnel. broader benefits to the Scottish economy and industry and the removal of retail waste • Identification of particular other third party investment products, in particular working markets for deeper should be seen with local authorities, will also exploration and potential pilot as a requirement. be explored as part of this initiatives. Initial focus should work. The study will report by include food and drink, the end of February 2017. timber and construction.

13 www.hitrans.org.uk/Projects/Current_Projects/Food_Port_-_Lifting_the_Spirit_Project 5.2 Facilitation 10 5.2 Facilitation Building sustainable partnerships to bring benefits to customers and help grow existing, new and

emerging markets. Much of the rail freight which operate across the GB network issues such as the damage to operates on the Scottish route should be fully protected. This the Lamington viaduct and the is cross-border, moving goods includes certainty on existing flooding on the Highland Main to other parts of the UK or to freight paths and the potential Line have had a significant, depots or ports for export. to create new ones in line with detrimental impact on the It is therefore essential that demand. Additionally, there are a movement of rail freight. accessibility to cross-border range of good examples where flows are effective and resilient. a coordinated approach has While infrastructure Strategic partnerships However, we will work with the It is our view that there helped to mitigate the worse development is the right The Economic Strategy reflects rail freight industry and other are potentially significant It is our view that many of effects of network disruption. approach to improved resilience that partnerships between partners to keep this under benefits from sharing freight Network Rail’s central HQ and However, a system of good and in some circumstances, such all parts of the public sector, regular review. In particular, movements: systems operator functions, timely communication between as gauge cleared diversionary employers, the third sector in response to any structural • Reduced costs for the such as infrastructure system operator functions and routes, it is equally, if not more and trade unions is key to changes within the broader respective rail freight projects, timetabling, planning Network Rail routes, alongside important to ensure that the driving change and growth. rail industry or changes to the providers. and capacity utilisation a shared desire to reach the right culture and behaviours are periodic review process. could be more effectively best outcome for rail users in place in times of disruption. • Pooling of risk across both Strong, strategic partnerships carried out if they were fully would be just as, if not more, In particular, that the rail industry provider and customer. are already a feature across Moving as one devolved to the Scottish effective than the current, is focussing all of its joint efforts the rail industry in Scotland, A recurring theme in the • More efficient use route. This would enable highly centralised approach. on doing the right thing for including rail freight. There are consultation responses and of network capacity. tailored and therefore more freight customers. a number of groups already the stakeholder sessions • Reduction in rail freight’s effective and timely responses In particular, we will work with in existence which consider was the imbalance of flows carbon footprint. to network issues, reached in full the Office of Rail and Road, the There have also been on-going the role of freight in shaping in domestic traffic and, • Increased carbon efficiency. collaboration with operators on ScotRail Alliance, Network Rail’s issues with the resilience of the future strategic rail planning accordingly, the opportunities the Scottish network. It would National freight team and the Channel Tunnel. While there are and investments. There is a to spread the costs and risks Ensuring cross-border also help to ensure that there wider industry to strengthen currently no direct services from similar picture at a GB level, presented by the sharing of flows are effective was no misalignment between freight targets and outcomes Scotland to the continent via where Scottish rail freight rail freight movements i.e. Unlike Network Rail routes or local and national priorities. through the periodic review the Tunnel, there are a number interests are represented on where two or more freight franchised passenger services, Some of these points have process. of goods movements which are all the key strategic industry providers would combine generally speaking rail freight been identified through the transferred to freight trains using and governmental groups. to run a single train. While has no defined geographic Shaw report’s recommendations Recent events have called the route. In addition, feedback there has been a number of boundaries, but rather is while others will be pursued into the question the resilience from the stakeholder sessions Given the above, we do not good examples of this, as a responsive to the needs separately by the Scottish of the rail network. While is that there is merit in exploring see the need for any change consequence of some technical of the market. Government. changing weather patterns the potential for a through in the structure of the strategic and commercial barriers, this mean that we are facing service from the Eurocentral partnerships at either Scottish is not common practice. Within this context there is challenges such as record terminal to the continent, which or GB level. a clear recognition that the levels of rain fall, the disruption would require certainty around position of freight services which caused over the winter through access to be viable. 5.2 Facilitation 11

A supportive regulatory National Planning Development Plans framework A number of consultation The position of rail freight in A common theme amongst responses noted the local planning decisions is also the responses was the need importance of the Scottish important if new markets and Rail freight is identified as having for a stable and supportive Government’s strategic traffic is to be attracted to regulatory environment for spatial planning, as reflected the sector, particularly around potential to reduce the carbon rail freight. In particular, that in the third National Planning the development of freight footprint of the freight sector and will the charging structure for Framework (NPF3). NPF3 is terminals, railheads and the freight operators and the clear that freight networks are efficient management of local have increasing importance in meeting incentive framework should critical to our economy, with traffic accessing such sites. our targets for exports. be built around the needs of investment in infrastructure freight customers. Also that helping to reduce congestion Transport and land use much more must be done and encourage modal shift. planning are distinct functions to incentivise Network Rail Specifically, rail freight is but have a clear relationship: to support an increase in identified as having potential one cannot be delivered freight traffic on the network. to reduce the carbon footprint without the other. Our suite of the freight sector and will of planning policies from a This strategy document have increasing importance national to a local level are not has reflected on the decline in meeting our targets for intended to replace transport in the rail freight markets. exports. plans, policies or strategies but A number of respondents to complement them. Scottish have highlighted that this will The Scottish Government Planning Policy (2014) sets free up capacity on the rail is working closely with the out national planning policies network and this should be Scottish Freight and Logistics which reflect our priorities for protected for rail freight use Advisory Group (ScotFlag) to the operation of the planning in order to support new bring life to our commitment system and the development market opportunities. to work with the freight sector and use of land. It sets out that in identifying strategic future rail freight needs, including Some responses also development priorities. We through new or expanded suggested that areas such will reflect on that work in our interchanges, are important in as Network Rail’s commercial forthcoming monitoring report the preparation of development leasing arrangements for NPF3, which will form part plans. It also encourages local and the Network Code of the evidence base to be development plans to locate can discincentivise private used to inform the review of the development which generates investment in freight facilities Framework, that we anticipate significant freight movements and services. to be completed in 2019. on sites accessible to suitable railheads. Development plans are subject to extensive consultation during preparation and the rail freight industry is strongly encouraged to engage in that process.

Actions 5.2 Facilitation actions 12

Facilitation ACTIONS

The Scottish Government’s We will report the findings of In working with the ORR we will The Scottish Government The Scottish Government will High Level Output Specification this to the Scotland Freight emphasise the key priorities for will reflect upon this advice in seek further information from (or equivalent) (HLOS) for Joint Board by January 2017, Transport Scotland, specifically: preparing revised statutory the Scotland Freight Joint Scotland’s railways for the which they will consider as part • Long term stability guidance to the ORR, which Board about the engagement period 2019-2024 (CP6), will of their broader work and predictability. will be issued alongside the of its membership with the include a specific output on on barriers to market entry. HLOS in summer 2017. development plan process • Flexibility and the ability the availability (including This will also be included in Network Rail will provide and how it considers that to respond to market resilience) of cross-border discussions with the DfT in an analysis of the network development plans could opportunities and challenges, routes for freight and, in that relation to cross-border flows. capacity released by the be further improved to both at a commodity context, the effectiveness of reduction in coal and steel identify key opportunities and geographic level. the coordination between the The ORR will provide advice traffic, both in the immediate, and optimise investment Scottish route and the rest to the Scottish Government • That Network Rail is properly medium and long term. potential in rail freight. This of the GB network. Advice on the regulatory framework incentivised to proactively They will then engage with the will report in November 2016. to the Scottish Government for freight as part of the support the growth of freight ORR and rail freight industry to on what this may look like will forthcoming periodic review traffic on the network, both explore opportunities to fully be included in the Scottish of Network Rail. We will local and cross-border. utilise the released capacity Initial Industry Plan, due in continue to work with the ORR to support alternative market September 2016. to explore options for how the This should be provided as opportunities for rail freight. charges and the incentives part of the broader ORR advice This work will primarily inform We will work with the main rail freight The Scottish Government will framework can provide a to the Scottish Government the statutory guidance to providers to understand the technical, work with the main rail freight stable platform to enable and through the periodic review the ORR and the work of the providers to understand encourage growth in the sector. process, which is expected Scotland Freight Joint Board regulatory, commercial and contractual the technical, regulatory, in spring 2017. on market opportunities. barriers to moving shared loads. commercial and contractual This will also consider the barriers to moving shared levers that may be available Network Rail will continue loads. to the Scottish Government to review commercial leasing to support this through the arrangements to ensure approach to funding. they remain fit for purpose for the current market. 5.3 Promotion 13 5.3 Promotion Shining a light on the economic, social & environmental benefits of moving goods by rail.

Shining a light on Scotland’s Broader perceptions among • Alongside passenger rail freight industry businesses included that: services, rail freight prevents The Economic Strategy outlines • Accessing rail services up to 57 serious road the importance of promoting was complex; casualties and fatalities Scotland’s international • Services were inflexible per year and delivers up brand and showcasing both and unreliable; and to £241m in travelling time Scotland and Scottish goods savings through reduced • Putting goods on rail was and services. This applies road congestion16. expensive when compared to both internal and export against other modes markets, enhancing Scotland’s Given this, the general (mainly roads). reputation as a good place view within the consultation to do business. responses was that more Whereas the reality is that: should be done to promote A common theme across the • Using rail can be more cost the use of rail freight by consultation responses and the efficient than road, in particular businesses in Scotland, stakeholder discussions was a for the movement of heavy and through Scottish public perception that the rail industry goods over large distances; sector procurement. and the Scottish Government • That rail freight is very reliable, could do more to promote with around 96%14 of freight Actions rail freight. As a consequence, trains running to time; there was potentially a lack of • Rail has significant awareness among businesses environmental benefits, with of the benefits of using rail 76% less carbon dioxide per freight, particularly against tonne of freight moved rail moving goods by road. compared to road15; and

14 www.orr.gov.uk/__data/assets/pdf_file/0009/19926/network-rail-monitor-scotland-2015-16-q1-2.pdf 15 www.raildeliverygroup.com/files/Publications/2014-05_keeping_the_lights_on.pdf 16 www.transport.gov.scot/system/files/documents/tsc-basic-pages/Rail/The%20econonomic%20 contribution%20of%20rail%20in%20Scotland%20March%202016.pdf 5.3 Promotion actions 14

Promotion We will work with the Scotland Freight Joint Board to produce an easy to understand guide to the benefits of using rail freight services and how to ACTIONS access them.

The Scotland Freight Joint Following on from the easy In support of the easy Board will produce an easy to understand guide, the to understand guide and to understand guide to Scottish Government will conferences, as a matter of the benefits of using rail work with public sector priority, but no later than end freight services and how to partners, the rail industry, November 2016, the Scotland access them. This will support and wider stakeholders to Freight Joint Board will work marketing opportunities for arrange a series of rail freight with public sector partners rail freight providers and will conferences in different to develop proposals for co-ordinate with any wider locations across Scotland a web-based portal that industry communications with the specific purpose of provides key, straightforward campaigns on the benefits enabling rail freight providers to information for Scottish of using rail. engage directly with individual businesses to help inform businesses – both major their logistics decision-making. In line with established producers and SMEs – business guidelines this will help organisations and relevant This could include freight maximise the available public bodies. These will be timetables, loading capacity, opportunities for rail freight rolled out from autumn 2016. availability and range of in construction projects and services, journey times, the wider planning of public hours of operation, indicative procurement generally. We costs and the contact details will also use our network of of logistics companies. contacts to circulate the guide This would also support the to Scottish businesses and work to identify opportunities public procurement bodies by for shared train movements, end October 2016. among other things identifying flexibility in the offer to customers.

Forth Rail Bridge, South Queensferry 5.4 Investment 15 5.4 Investment Maximising the impact of public and private investment with a focus on aligned incentives and collaboration to drive efficiency and value for money.

The Economic Strategy Despite the obvious success • That a whole system rail investments. In particular, • It is of critical importance recognises the importance of the investment programme, approach to investment greater clarity in rail freight that the Scottish and UK of investing in Scotland’s the response to the consultation should be adopted. outputs through processes Governments take a joint infrastructure to help Scottish was clear that the approach For a long period of time for planning and specification approach to investment in Freight has benefited businesses to grow, innovate, can be improved in a number now the vast majority of of rail investments, both at rail freight as it affects cross- and create good quality of ways: rail freight investment a whole railway and freight border flows. This applies to from this investment employment opportunities. • Greater certainty and stability has been infrastructure specific level. the full range of opportunities in a number of ways, in the public investment related. However, there was • That the system of freight through investment in rail through the day to The Scottish Government has programme is needed a consistent view from a mode shift grants available itself and also in areas such a strong record of investing to encourage third party number of respondents that for rail freight is highly valued as depots and access to day operation of the in Scotland’s railway network, investment. This should be thought should be given (Mode Shift Revenue Support ports and harbours. rail network, new lines, with over £6bn invested in to investing more widely, Of particular importance, underpinned by an in-depth and Freight Facilities Grant) new electrified routes infrastructure and services study of the current rail for example through seed but there was a perception that the opportunities for rail since 2007, with a £5bn freight market in Scotland funding of pilot initiatives, that it could in a number freight across GB to support and additional gauge programme earmarked until and the opportunities for rolling stock and the upgrade of circumstances be more the Scottish export markets clearance. 2019, including the £30m investment. of freight yard facilities. responsive to opportunities in are fully realised. Scottish Strategic Rail Freight • Identifying and formalising • There is a perception that the rail freight sector. Investment Fund administered Actions a Strategic Freight Network freight investment has been by the industry. Freight has for Scotland, including of secondary importance in benefited from this investment interactions with cross-border planning, with benefits often in a number of ways, through services, will help to target a by-product of investment the day to day operation of the investment. in passenger services. This rail network, new lines, new position has improved in electrified routes and additional recent times, for example gauge clearance. through the Scottish Strategic Rail Freight Investment Fund, but that more work should be done to place freight on a more equal footing in future 5.4 Investment actions 16

Investment ACTIONS

The Scottish Government has • Rail industry consideration Following on from this, Areas of focus in the advice The Scottish Government’s The Scottish Government will already published broad based of any viable options for the the advice provided to the should include potential High Level Output Specification continue to provide advice research on the overall value Scottish Government grant Scottish Government through improvements to the capability for Scotland’s railways for the and support to potential freight of rail to Scotland’s economy, funding system as it applies the Scottish Initial Industry of the Scottish network, period 2019-2024 (CP6), will mode shift grant applicants. including some detail on the to rail freight. Plan, due in September 2016, particularly for container include a specific section on impact of rail freight16. We will be explicit on how rail movements, both in terms freight, including expectations We are open to ideas from will follow this up by jointly The Scotland Freight Joint freight needs have been of gauge and in train length. on performance, investment the industry - which are in commissioning with the Board will identify and fully considered in the rail We would expect this to and resilience. Where broader accordance with both Scotland Freight Joint Board formalise the Scottish investment priorities include a strategic East Coast rail investment is specified, domestic and European law a specific deep dive market Strategic Freight Network by beyond 2019. cross-border freight corridor the required outcomes for rail - for viable approaches to commodity study which will June 2016. This will include any with additional capacity, freight will be clearly identified other grants. review market potential at interactions with the network The advice will include industry both as a viable alternative and articulated. both a Scotland wide and in England and Wales relative proposals for a refocused route for existing traffic and more localised geographic to cross-border services. Early Scottish Strategic Rail to maximise the export and The Scottish Government level. This work will be work should also be done to Freight Investment Fund, import opportunities of the UK will seek agreement with the completed by July 2016 identify potential diversionary either separate from or deep ports, opportunities for UK Government to establish and will inform: routes within Scotland that as part of a rail innovation enhanced rail freight services a focus group which will • The rail industry advice to can be gauge cleared for fund, with an emphasis on on the Highland Main Line, and ensure that there is complete the Scottish Government freight with no or minimal whole system solutions to exploiting the full potential of alignment in the investment through the Scottish Initial intervention. This should build rail freight challenges, how the electrification of the Edinburgh strategy for rail freight Industry Plan for investment on the positive experience of priorities identified will tackle Suburban line and upgrades to between both Governments. post 2019. the escalated process to clear the challenges of the declining related infrastructure, including In particular, to work towards a traditional markets and how Millerhill. set of joint outcomes for cross- • The work of the Scotland routes during the closure of the the investment sits within the border freight to be specified Freight Joint Board to Lamington viaduct. Strategic Freight Network through the respective HLOS’ consider the opportunities for for Scotland. (or equivalent). and barriers to market entry.

16 www.transport.gov.scot/system/files/documents/tsc-basic-pages/Rail/The%20econonomic%20 contribution%20of%20rail%20in%20Scotland%20March%202016.pdf 6. Measuring success / 7. Impact assessments 17 6. MEASURING 7. IMPACT SUCCESS ASSESSMENTS Strategic Environmental Assessment As required by the Environmental Assessment (Scotland) Act 2005 Transport Scotland has considered the requirement for a Strategic Environmental Assessment of the Rail Freight Strategy. Given the overarching role of the strategy it has been concluded that it will have no environmental There were mixed views within It is, however, important to The Scottish Government effects and therefore has been exempted following the consultation responses on track and measure the success will publish an initial report the benefits of setting targets. of the strategy. Based on the on progress against the completion of a screening report. On the one hand, that there feedback from the consultation, critical success factors by were already a significant and we have identified a suite of June 2018 i.e. 2 years after the sufficient number of targets critical success factors: implementation of the strategy, Equality already in place, from those set • A sustainable rail freight followed by periodic updates. The Scottish Government is fully committed to by the regulator to individual industry, with identifiable equality. A high-level Equalities Impact Assessment company targets. On the other growth potential over time. It is also important to monitor hand, aspirational targets the delivery of the actions has concluded that the strategy will have no specific • Creating increased could help to drive the strategy within the strategy. We will opportunities for Scottish impact on protected equalities characteristics. towards conclusion. report progress to the exports. Scotland Freight Joint Board However, this will be monitored as the actions On balance, we have concluded • Longer, faster, greener on a 6 monthly basis and within the strategy develop. that at this stage the strategy freight trains. also publish this on Transport should not set hard targets • A high performing, resilient, Scotland’s website. for the rail freight industry. strategic freight network for Business & Regulatory Impact Assessment We would be happy to revisit Scotland, fully aligned with The Scottish Government is committed to the this at any time, with guidance the cross-border flows. from the Scotland Freight • Strong partnerships across principles of better regulation. Although not Joint Board. the industry, focussing on introducing any new legislation or regulation, an doing the right things for outline BRIA has been produced by Transport customers. Scotland. This concluded that the actions proposed • High value returns on public within the Strategy will not lead to any additional and private investments. burdens on businesses. 8. Actions – Summary 18 8. ACTIONS – SUMMARY

Innovation Facilitation The Scottish Government will Promotion Investment The Scottish Government will The Scotland Freight Joint Network Rail will assess the continue to work with the ORR The Scotland Freight Joint The Scotland Freight Joint publish an initial report on Board will consider the barriers network capacity released by the to explore options for how the Board will produce an easy Board will identify and formalise progress against the critical to innovation and attracting reduction in coal and steel traffic charges and the incentives to understand guide to the the Scottish strategic freight success factors. new freight onto the railway and, working with operators in framework can provide a benefits of using rail freight network. June 2018 network and how these can the development of the Strategic stable platform to enable and services and how to access June 2016 be overcome. Capacity Statement, ensure encourage growth in the sector. them. that the industry can secure the July 2016 Spring 2017 October 2016 The Scottish Government capacity required to support The Scottish Government will seek agreement with the alternative freight traffic. and the Scotland Freight Joint UK Government to establish The rail freight industry should The Scottish Government’s Board will jointly commission November 2016 The Scottish Government a focus group which will provide advice to the Scottish High Level Output Specification will work with public sector a specific deep dive market ensure that there is complete Government through the for Scotland’s railways for partners and the rail freight commodity study which will alignment in the investment Scottish Initial Industry Plan, The Scottish Government the period 2019-2024 (CP6), industry to arrange a series review market potential at strategy for rail freight between on the establishment of a will seek further information will include a specific output of rail freight conferences. both a Scotland wide and more both Governments. ring-fenced rail freight from the Scotland Freight Joint on the availability (including localised geographic level. innovation fund. Board about the engagement resilience) of cross-border Autumn 2016 On-going July 2016 of its membership with the routes for freight. September 2016 development plan process Summer 2017 The Scotland Freight Joint Board The Scottish Government will and how it considers that The advice provided to the will work with public sector report progress on the actions development plans could be Scottish Government through We will establish a short-life partners to develop proposals to the Scotland Freight Joint further improved to identify Network Rail will continue to the Scottish Initial Industry working group to consider for a web-based portal. Board on a 6 monthly basis. opportunities for moving low key opportunities and review commercial leasing Plan, will be explicit on how bulk goods and parcels on optimise investment arrangements to ensure they November 2016 rail freight needs have been On-going passenger services. potential in rail freight. remain fit for purpose for the fully considered in the rail current market. investment priorities beyond January 2017 November 2016 2019, including a refocused The Scottish Government will On-going Scottish Strategic Rail Freight continue to provide advice and support to potential freight The Scotland Freight Joint The Scottish Government Investment Fund. mode shift grant applicants. Board will commission a will work with freight providers September 2016 study on the potential for to understand the technical, On-going an ‘urban freight network’. commercial and contractual barriers to moving shared loads. The Scottish Government’s February 2017 High Level Output Specification The Scottish Government is January 2017 for Scotland’s railways for the open to ideas from the industry period 2019-2024 (CP6), will - which are in accordance with include a specific section on both domestic and European freight, including expectations law - for viable approaches on performance, investment to other grants. and resilience. On-going Summer 2017 9. Glossary 19

Highland Main Line Millerhill The Scottish Freight & A 118 mile rail line which Millerhill is a rail yard Logistics Advisory Group connects towns and villages just south of Edinburgh, (ScotFlag) 9. GLOSSARY to Perth at one end and which links to the Edinburgh ScotFlag monitors and Inverness at the other. Suburban Line and East provides advice to the Scottish Coast Main Line. Government on the delivery Lamington Viaduct of wider freight policy in Carrying the West Coast Network Code Scotland and its contribution Main Line over the River Clyde The Network Code is a towards national outcomes it was damaged by the swollen common set of rules and and objectives. river on Hogmanay 2015, and industry procedures that reopened in February 2016 apply to all parties who have Scotland Freight Joint Board Abellio ScotRail Cross-border operators Freight Facilities Grant after extensive repair work. a contractual right of access A collaborative governance Abellio is a subsidiary of The train companies who A Scottish Government grant to the track owned and structure which puts the rail Nederlandse Spoorwegen, operate passenger franchised which helps companies with Logistics Providers operated by Network Rail. freight industry at the centre which is the principal services between destinations the capital costs associated Logistics service providers of planning and investment passenger railway operator in in Scotland and England. with moving freight by rail often act as intermediaries Network Rail decisions on Scotland’s the Netherlands. The company or water instead of road, by offering a variety of services Maintains, operates, renews railways. has been operating Scotland’s Digital Railway offsetting the extra costs of and are espicially useful when and enhances the rail daytime passenger services, The proposal for the UK to providing freight handling considering multi-modal infrastructure across Great ScotRail Alliance as specified by the Scottish adopt modern digital signalling facilities. It’s designed to distribution. They can manage Britain. Network Rail has a A formal collaboration Government under the ScotRail and train control within the facilitate and support modal the whole process dedicated National Freight between Abellio ScotRail franchise, since April 2015. next 25 years and create shift, generating environmental for customers. team reflecting the GB-wide and Network Rail in Scotland credible options to upgrade and wider social benefits. nature of the rail freight market. to make the Scottish rail Branchliner to next generation technology Longannet Power Station industry more responsive Led by HITRANS and involving as it becomes available. Freight Operating Companies The largest (coal fired) Office of Rail and Road (ORR) to customers’ needs. key players in the logistics and Rail Freight is a commercial generator of power in Scotland, The Office of Rail and Road timber industries, this pilot Edinburgh Suburban Line service provided by private with the capacity to power two is the independent safety Scottish Initial initiative is considering the An east-west rail line on the freight train operating million households, it occupies and economic regulator for Industry Plan (IIP) opportunities and challenges southern margin of Edinburgh, companies (also known as an 89-hectare site on the north Britain’s railways and monitor As part of the periodic review of moving timber forestry facilitating the movement of FOCs) for customers. shore of the Firth of Forth near of Highways England process, the IIP provides products by rail. heavy freight across the city. Kincardine, Fife. It is due to close advice from the rail industry High Level Output on the 31st March 2016. Periodic Review operating in Scotland to the Control Period 5 Eurocentral Specification (HLOS) The process through which the Scottish Government on the The current five year railway Eurocentral is one of the The document through which Mode Shift Revenue ORR determines what Network choices and options for railway cycle, from 2014-2019, during largest industrial estates in the Scottish Government Support Grant Rail must achieve over five year investment. The next IIP is due which Network Rail will deliver Scotland, situated on the edge outlines its investment priorities A Scottish Government grant cycles, the money it requires in September 2016 and will the outputs specified by the of Holytown and Mossend, for Scotland’s railways. This which helps companies with to do this, and the incentives primarily cover the period Scottish Government and set North Lanarkshire. As well forms the key component of the extra operating costs needed to encourage 2019-2024. by the Office of Rail and Road as warehouse distribution the ORR’s 5 yearly periodic associated with moving freight rail industry delivery and (see also ‘Periodic Review’). centres, it hosts a railfreight review process, which sets by rail or inland waterways outperformance. Scottish Strategic Rail centre (DB Schenker) which the outputs and funding for instead of road. It’s designed Freight Investment Fund links with Grangemouth docks Network Rail. to facilitate and support modal A fund put in place in Control 28 miles (45 km) to the north shift, generating environmental Period 5 to encourage growth east, England to the south and and wider social benefits. in rail freight and reduce beyond to mainland Europe. emissions. Administered by the rail freight industry through the Scotland Freight Joint Board. Transport Scotland Buchanan House, 58 Port Dundas Road, Glasgow, G4 0HF 0141 272 7100 [email protected]

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