HL Deb 25 July 1983 vol 443 cc1383-8

3.47 p.m.

Lord Plant rose to ask Her Majesty's Government whether they consider (a) that they are giving enough encouragement to the development of the waterways of Britain to deal with increased internal and import/export freight; and (b) that they deal financially more harshly with waterways than with other methods of transport.

The noble Lord said: My Lords, 65 years ago, I lived at a small village, Cheddleton on the Caldon Canal. I walked to the station along the tow-path each day passing Brittains paper works employing several hundred workers. There was a constant stream of horse-drawn barges to Brittains and other works. Brittains is now derelict and the canal only used for leisure.

After the death of Lord Feather in 1976, I was appointed deputy chairman of the British Waterways Board. I felt at the time that the civil servants at the department gave little encouragement to the board to push ahead with its plans for improved freight transport but rather to develop the canals for leisure. Fortunately, Sir Frank Price, the chairman, had a clear view of the commercial future of the waterways.

I pay tribute to the drive and foresight of Sir Frank and the loyalty of the 3,000 dedicated staff.

I believe that the new Secretary of State shares Sir Frank's views. The British Waterways Board's freight services hold a unique position within the transport industry. As well as the promotion and development of traffic and facilities on the commercial waterways, they manage warehouses, depots, wharves, docks and road and inland waterway freight-carrying fleets. This means that the board is capable, in conjunction with other transport systems, of providing a total transport service for the movement of goods, whether within the United Kingdom or in connection with export and import requirements.

Like most fields of economic activity, the freight transport industry is subject to rapid change. It is affected by technological change, fluctuations in the level and changes in the patterns of trade and Government policy decisions. To remain competitive, each transport mode must be responsive to these external forces. In the United Kingdom the various modes of inland transport—road, rail, waterway and pipeline—have unfortunately developed separately. Waterway transport was the first method of moving goods on a large scale, but with the advent of rail and road, little further investment was made in the waterways to enable them to compete. As a result the potential of waterway transport has been virtually ignored. In the 17th century, the River Severn was one of the two most used waterways in Europe. I shall return to the Severn later.

The past few years have shown a slight but welcome change of approach by Governments. In 1978 the first major improvement to a freight waterway for over 70 years was authorised. The scheme, the Sheffield and South Yorkshire Navigation, was completed and reopened for use in June. It facilitates the passage of craft of up to 700 tonnes to Rotherham in the heart of the South Yorkshire industrial conurbation. The present traffic assessment for the canal is 1.8 million tonnes per annum, with further large tonnages for the future.

Government statistics on inland waterway transport were, for many years, almost non-existent. Steps have now been taken—after many years of protest—to provide statistics for all waterways in the United Kingdom used for the carriage of freight. The British Waterways Board controls only 350 miles of the 1,400 miles of waterways in this country.

Another welcome development, as a result of continued pressure, is the provision, under Section 36 of the Transport Act 1981, for grants to the private sector towards the cost of waterway infrastructure which could result in a reduction of traffic on roads. The first grant of £369,000 for the reinstating and modernising of a disused wharf on the River Trent at Gainsborough, was announced by the Secretary of State for Transport on 27th June this year. Nevertheless, the complexity of the conditions and the regulations which are attached to the making of Section 36 grants is an inhibiting factor in the submission of a successful application for grant, as pointed out by my noble friend Lady Loudoun on 20th December last.

Even so, there is still a need to rectify the imbalance in investment criteria for competing transport modes. Unlike the roads, improvements to a waterway for freight carry a heavy financial burden in interest charges, for which the customer has to pay. Competition between transport modes should be based on rules which are clearly equitable and fair. The cost of the Sheffield and South Yorkshire Navigation was £16 million, of which £10 million was capital funded—£1 million from the local authority, which has given so much encouragement; £3 million from the EEC, and the balance from the Government. That was the first occasion on which the EEC has assisted water transport.

The Government produce money for the infrastructure of roads and rail. The British Waterways Board borrows for water transport over a period of 25 years from the National Loan Fund and pays the going rate of 12 per cent. The Sheffield and South Yorkshire navigation loan at one time had an interest repayment of 16 per cent. Interest charges result in £l¼ million per annum which has to be recovered by tolls from its customers. Investment in roads does not carry interest charges. That to me is contrary to the Treaty of Rome, which says that there should be fair competition. The Council of Ministers has not been complying with the Treaty of Rome.

The waterways hoard has spearheaded technological change on its waterways without, in many cases, the active help of the department. The introduction of push-tow techniques has reinforced the fact that waterway transport is cost-effective. Operating costs per tonne are low. The serviceable life of a barge is 25 to 30 years—much in excess of that of a road vehicle—and the labour content per tonne moved is also much lower. Added to this, studies carried out in Europe, the United States of America and the United Kingdom have shown that water transport is more energy-efficient than rail, and on average between four and five times more so than road transport. And, of course, waterways are friendly to the environment—there is little noise, vibration, pollution or visual intrusion, and very few accidents.

There is no doubt that clear benefits accrue from maximising the use of waterways for freight transport for the movement of bulk and semi-bulk commodities. All European countries are developing their waterways. In this country we have only had the Sheffield and South Yorkshire Navigation this century. I believe that the Government say, "Let us see how that goes on before we spend more money".

In recent years the most significant factor affecting trade has been the entry of the United Kindom into the European Economic Community. In 1972, only 31 per cent. of United Kingdom trade by value was with the other eight member countries. By 1982, this had risen to 43 per cent. The United Kingdom trade pattern is changing from one dependent upon ocean trades to one dependent upon short and middle-sea routes.

The British Waterways Board was closely involved with the promotion of the BACAT barge-carrying vessel service to the Humber Estuary which operated between 1974 and 1975. The concept is one in which a number of barges are carried on board a sea-going "mother ship" and loaded/discharged by means of a gantry crane, an elevator or floatation. Although three ocean-going barge-carrying vessel services continue to serve the United Kingdom, BACAT was the only system designed specifically to obtain maximum penetration of the United Kingdom waterway network and to operate on a short sea-route. The demise of the service was not caused by any inherent defects in the system, which proved to be commercially viable, but by reluctant management and, I regret to say, a reluctant labour force at the docks. The board is convinced that the service created jobs and brought considerable benefits to the area, both directly and indirectly. A reintroduction of a similar service to the Humber Estuary would assist in the revitalisation of Humberside. With the increasing trade with mainland Europe, the introduction of the low profile river/sea-going vessel is also of considerable importance to the board's strategy. These vessels can reach inland locations such as Rotherham, Gloucester, Northwich and Gainsborough and operate to ports in mainland Europe as far inland as Basle, Liege and Paris.

Not without significance is the fact that many cargoes which went to the east coast are now being sent to the west coast ports to avoid the heavy road costs involved in conveying cargoes from ports on the east coast to the centre of the country. There is little doubt that navigations such as the Weaver take barges up to 1,000 tonnes from the Mediterranean and North Europe into the heartland of Britain.

It is policy to join with private enterprise in waterway freight transport operations where it makes sense. As an example, Inland Waterway Carriers Limited has brought together managerial, financial and operational expertise from the private and public sectors in the development of specially designed self-discharging craft for the carriage of millions of tonnes of minestone waste on the Aire and Calder Navigation. Waterways are already used extensively for the removal of household waste and sewage and industrial sludges. The Coal and Environment study drew attention to the problem of the removal of waste from coal production in the years ahead. The board is keen to see the waterways used for this traffic in the Yorkshire/Humberside Region in particular and is closely associated with the studies being undertaken by the local authorities concerned.

Inland waterways are eminently suitable for the movement of hazardous and dangerous goods. Substantial quantities of petroleum products, caustic soda, sulphuric acid and chlorine are already moved on inland waterways. Public concern over the transport of such goods by road is widespread, and growing. The inherent safety of water transport makes it ideal for the movement of substances with explosive, radioactive, toxic, corrosive and flammable properties.

Over the last few years, considerable numbers of containers have begun to be moved on waterways in both mainland Europe and the United States. Opportunities also arise in the movement of heavy "lifts". In 1981, a large water processing unit was moved by water from Gloucester to Avonmouth for export to Abu Dhabi. The movement of such loads by rail can present problems because of loading-gauge restrictions; transport by road involves disruption of traffic and the risk of damage to roads and bridges. Waterways such as the Trent Navigation and the River Severn reach the industrial heartland of the United Kingdom offering the prospect of the bulk movement of raw materials and finished products and improving the competitive position of industry.

In conjunction with Nottingham County Council, a study was commissioned to examine potential for traffic development on the Trent Navigation. The consultants' report is being considered with a view to deciding future policy. The development of transhipment at Keadby, at the junction with the lower River Trent, is also being considered. A major inland terminal capable of handling ships of up to 2,000 tonnes is being examined which would provide facilities for transit and long-term storage. An improvement to the Stainforth and Keadby Canal would provide a direct link with the improved Sheffield and South Yorkshire Navigation. The need for money and sympathetic Government support is obvious.

A number of studies have been carried out over the years into the development of the Grand Union Canal in the London area to provide a link between the lower Thames and West London. The latest proposals, involving the improvement of the waterway to Brentford, are now being considered.

It is vital to secure the co-operation of local authorities which have recognised the role of inland commercial waterways for the carriage of freight in their structure plans. South Yorkshire County Council is actively involved in the promotion of the improved Sheffield and South Yorkshire Navigation, having contributed £ 1 million towards the costs of the scheme. The location of suitable industry alongside the waterway is particularly important and is recognised as such. In this way advantage can be taken of the comparatively inexpensive cost of water transport.

This interrelationship of transport mode and industrial structure is typified in the concept of the Severn Corridor. The corridor comprises the Gloucester and Sharpness Canal and the River Severn, linking the Severn estuary at Sharpness with the fringe of the West Midlands industrial region at Worcester. The corridor encompasses an area of activity of regional proportions in which the activities of many authorities and interests necessarily interrelate with one another. For some time the British Waterways Board has been examining the prospects and associated costs for developing a major flow of traffic on this waterway route. Market surveys indicate that there is an important flow of traffic in this corridor and that a competitive waterway operation could secure a fair proportion of that traffic. The board's general policy is that the Severn Corridor should be developed as a modern freight-carrying artery, with the standard in regard to vessel size being in the range of 1,500 tonnes to 2,500 tonnes. Because of the total effect upon the region, the board would not be able to achieve this in isolation but is providing the lead in promoting an awareness and interest in what, from the board's standpoint, needs to be done to bring about the creation of a modern waterway system adapted and suited to the needs of the region.

For example, besides the physical enlargement of the waterway, a number of important engineering aspects must be taken into account, such as the Severn Barrage—tidal exclusion on the River Severn—arrears of maintenance on the waterway, and the improvement of road communication and bridges. Consultation, liaison, planning and construction, involving the local authorities and other public and private bodies as well as the board, are in hand.

It is estimated that the costs will be £25 million. It is hoped that local authorities and the EEC will contribute so as to reduce the interest repayment to the National Loan Fund. With governmental initiative, the development of the Severn Corridor as a major water artery from the sea to the industrial heart of the Midlands would be realised. It must be of benefit to the economic growth of the region to have a waterway connection to the trade routes of Europe and to the world.

The strategy for the future of waterway transport consists of three basic elements. First, there is the need to ensure that competition between transport modes is equitable and fair. The growing energy problems, the need to conserve oil fuels and the natural advantage of the waterway will provide increasing evidence of opportunities for growth.

Secondly, change, whether caused by technological innovation, market fluctuations or Government policy decisions, must be flexible. We live in a rapidly changing world and one in which the future is becoming increasingly hard to predict. We must be responsive to change in the circumstances of all transport modes and be ready to grasp opportunities when they arise.

Finally, I come to planning for the future. In the past, transport infrastructure generally has been developed in response to needs as they have arisen rather than as a result of proper land use planning. Investment in transport infrastructure has for several decades been directed mainly to road construction, to the detriment of waterways and railways. There is no doubt that, as a result, much damage has been done—and continues to be done—to the quality of life, to the environment and to social conditions generally. Long-term investment in infrastructure should be directed in such a way as to create demand. Each transport mode has a role to play in this.

Inland waterway transport in the United Kingdom has reached a turning point. In recent years the decline in tonnages has been arrested. The recession has affected all transport modes, but waterways do not appear to have fared as badly as other modes. The total tonnage carried on the commercial waterways increased by 11 per cent. in 1982, despite the general economic difficulties. We must be ready to take advantage of changing traffic patterns in the knowledge that commercial waterways can play a bigger part in the transport needs of the United Kingdom.

Many people claim that water transport is slow when compared to road and rail. But this country's imports and exports move, for the greater part of their journey, at no more than 14/15 knots. Since most parts of the United Kingdom are within 100 miles of the sea, why is it felt necessary to dash at 70 miles per hour over the last part of the journey? I beg to move.

The Earl of Swinton

My Lords, I think the noble Lord means that he wishes to ask the Question standing in his name?

Lord Plant

My Lords, yes. I thank the noble Earl for correcting me.