Ports Policy in its Wider Context
The Impact of the Eddington, Stern and Barker Reports
Ports do not exist in a vacuum. There is a wider world of policy and public interest that sets the context in which we live, and in which we will grow. Three major Treasury-sponsored reports have been published in recent years: Stern (environment), Eddington (transport) and Barker (planning) represent heavyweight contributions to a wider debate on where we are going, and how ports will adapt to changing circumstances.
All three reports are intrinsically linked. And they examine the environment, transport and the planning system’s links with the economy and with each other. Ports’ fortunes are, of course, directly related to the UK’s economic performance. 28% of UK national income is traded. Three-quarters of that business occurs at our ports.
Future Transport Policy
Eddington’s report on Transport’s Role in Sustaining the UK’s Productivity and Competitiveness would seem to be of the most obvious importance for ports. The fundamental argument the report makes is that transport facilitates economic activity.
The report contains important news for ports. It notes the potential costs of failing to provide additional port capacity, and highlights potential constraints in ro-ro capacity after 2015. Port developers should face the full environmental costs of development but the economic case should remain broadly favourable. Indeed most major developments now involve programmes of compensation.
He also notes that surface access projects should cost relatively little, whilst delivering a high cost-benefit ratio and substantial GDP benefits. The implication is that providing surface access to ports is one of the best areas for Government to focus its transport investment on. On this basis Government should reassess its policy on seeking contributions towards new or improved rail and road connections.
Changes to Planning
Eddington’s recommendation that an Independent Planning Commission (IPC) be created to deal with major infrastructure proposals is an interesting one; it is evidence of close cooperation with the authors of the Barker Report on the planning system. The UK has an uneven record in delivering an efficient planning process.
An IPC would develop ‘sector statements’- a series of high level objectives to be delivered through the planning system. Proposals which went towards achieving those objectives could be taken forward by a faster, more efficient process.
The BPA sees clear benefits for infrastructure projects like port development: the arguments surrounding the merits of development will take place before the policy is set out, rather than being repeated at every planning application.
That idea has the potential to save time during the planning process, and echoes the demand for a ‘statement of need’ based upon regular forecasting exercises made by the BPA in its response to the Ports Policy Review consultation.
Climate Change
Both Eddington and Barker’s reports are part of the bigger picture for the port industry. In terms of providing context, however, the Stern Review is one of the most significant documents to have come from Whitehall in the past decade.
Climate change and emission control are going to be major challenges for the economies of developed states for the foreseeable future. Stern argues strongly for the establishment of a true cost of carbon, through taxation and carbon trading. Eddington strongly supports him.
Paying to mitigate environmental impacts is nothing new to the port industry, and whilst a carbon cost will bring new expenses, it may also bring new opportunities. Ports and shipping are justifiably proud of their strong environmental credentials. Ships’ carbon emissions per ton of cargo are considerably less than those of road freight.
Reducing emissions through modal shift has been one of the main arguments put forward in support of short sea shipping. Until now the economics have not been right to support the wider use of coastal shipping- but it is not hard to believe that as the true cost of carbon begins to bite, and the cost of road and rail haulage increases, that shipping, the more environmentally-sustainable option will become more viable.
Next Steps
This, then, is the wider context for the port industry. Whilst the ports policy review will deal with the detailed aspects of the industry, Eddington, Barker and Stern have effectively set out a roadmap. This issues the industry a challenge.
The first is that to recognise and react to all that is going on around us. These three reports are important for the industry. The forthcoming Marine Bill, and much else, is important too.
The BPA recognises that the ports industry has the chance to get things right- to enable ports to be engines of wider transport and economic policy.