UK Needs National Strategic Ports Policy

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The UK needs a national strategic ports policy
Martyn Pellew
13 June 2005
International Freighting Weekly

The UK ports sector is highly unusual.

Major ports were privatised during the Thatcher years and successfully brought money into the Treasury's coffers. This was a good decision, but in the 21st century it is time to challenge whether free market rules should determine the UK's strategic infrastructure.

Our strategic infrastructure assets such as airports, roads and railways each have agreed national policies and frameworks.

For example, in 2003 the government white paper The Future of Air Transportdetermined that airport expansion in the southeast would be conditional upon environmental criteria.

The government has similarly provided a strategic framework for our railways: The Future of Railwhite paper last July.

The Future of Transportwhite paper (also July 2004) set out government policy on wider transport infrastructure. This looked into the factors that will shape travel and transport over the next 30 years. The Highways Agency also has an agreed set of strategic priorities related to roads.

There is a pattern emerging here. But what of our ports and sea/water transport?

The UK has no current strategic ports policy or framework and one is desperately needed. Since the privatisation of the ports over a decade ago, the resultant free market has served us well. However, in recent years there have been significant changes within the UK that mean a free market concept on major ports'infrastructure may not be safe if broader public policies, beyond just convenience for the shipping industry, are taken into consideration.

Before the DfT today are a number of applications seeking the expansion of many UK ports. The expansion plans are mostly to do with providing increased capacity to cope with more than 4m teu of containers imported annually from deepsea, (intercontinental) points of origin.

They include Felixstowe South and Bathside Bay in Harwich, both owned by Hutchison Port Holdings, and Thames Gateway. These proposals are all in the south-east, where road and rail infrastructure is severely congested and often operates at or beyond capacity.

There are also plans in the pipeline for expansion of container handling facilities at Hull, Liverpool, Hunterston, Scapa Flow and, most recently, Bristol. Teesport also has plans to expand. If all such plans were approved and built, the UK would increase current throughput from 4m teu to a ports capacity for over 10m teu. This is not sustainable.

The issue is where best to allow the increase in port capacity to be situated.

Many, especially among the southern ports, would argue to let the market decide. That would inevitably mean building in the south.

London and the south-east is the biggest UK market, and the south-east corner gives shipping lines the least deviation from their routes sailing from the Far East before going on to call at continental ports. But expansion in the south will undoubtedly add to the congestion and the jobs market in much of the south-east is already overheated.

So is there a more important set of criteria which the UK should consider? I would propose a set of sequential tests related to sustainable development, to the economic output gap between the north and south of the country, and to the environmental impact of HGVs travelling over 450km on a round trip to deliver goods to northern retailers and consumers. We should also consider where to allow expansion based on a sequential test of priorities such as brownfield versus greenfield development, development in high or low-employment areas, the ability to tackle social deprivation and CO 2emissions.

It is not logical to decide on each planning application in isolation and before deciding on a national ports strategy. And yet this is current government policy.

The development of the nation's strategic infrastructure must be an issue for collective government departments to balance all considerations. The process of establishing a new ports framework or policy need only take a few months. Private sector investment will then ensure that the port capacity increase is delivered where and when the government directs to best meet the overall needs.

Naturally, at Teesport we believe we can offer a brownfield site for development where shippers and shipping lines can use a northern gateway to serve northern customers and retailers. The Humber and Liverpool, I am sure, feel the same. The Northern Way, the plan of the government's three northern regional development agencies, have already published their proposal to increase the share of UK port traffic volumes handled through the north from 32% to 35%.

If the government will not commit to a container ports strategy, then imminent decisions could serve to invalidate – for 10 years or more – policies to address the £29bn economic output gap between the north of England and the rest of the UK.