It is almost impossible to make a detailed Return on Investment decision on high profile transport investments. However, it is clear to any business or individual that investment is long overdue. Lee Collinson reports.
On 23 June 2014, George Osborne stood in the Power Hall of Manchester’s Museum of Science and Industry and declared, “We need a Northern Powerhouse.”
Acknowledging that “the dice are unfairly loaded against the north,” and that the transport network was “not fit for purpose”, Osborne’s vision was of a collaborative, connected network of cities capable of providing the jobs, opportunities and security people need.
Over the past half-decade, some things have changed for the better but some businesses in the North have shared their views with me that there is more work still to be done.
Automobiles are by far the most popular mode of travel. According to the latest Department for Transport data, they account for more than 60% of the 8.3 billion journeys made in 2017/18 and almost 80% of the record 808 billion passenger kilometres travelled.
By comparison, second was walking (26%), followed by buses and rail at just 6% and 3% respectively.
A similar story appears when you look at domestic freight travel. The vast majority (78%) of goods moved were by road (13% by water and 9% by rail), with food products accounting for 21% of all commodities lifted.
Yet, 41% don’t believe that the country’s road network meets their needs, according to research by the British Chambers of Commerce (BCC).
The study found that 68% of businesses regard the UK road network as less reliable compared to five years ago.
As a result of travel delays in the previous month, 52% of businesses reported increased direct travel costs, 33% had been restricted in their access to existing or potential customers, and 30% had increased costs of products/services.
Speaking in May 2019, Mike Spicer, director of policy at the BCC, appraised the landscape, “Businesses rely on the UK’s infrastructure to connect with customers, suppliers and staff.
“Many firms believe the reliability of the country’s transport network in particular has worsened in recent years, as capacity constraints, congestion and delays in the development of new routes have left businesses frustrated.”
Jams and potholes
Congestion cost UK drivers almost £8bn in 2018, with road users losing 178 hours on average last year, according to transport data firm Inrix.
The initial roads investment programme Osborne unveiled mentioned upgrades to the M62, M1, A1 in Newcastle and Gateshead, and a new Mersey Gateway Bridge.
Further schemes announced include a new bridge over the River Wear linking Sunderland’s Castletown in the north with Pallion in the south, ‘smart motorways’ on the M60 in Greater Manchester, and improved connections between Manchester and its airport. Some of these proposals are already in operation or are on the way to completion.
However, it’s worth noting that with new road infrastructure, comes an increased need to maintain those roads. The bill to the taxpayers for repairing potholes has risen to more than £1bn – almost a third higher than the previous 12 months, according to research released in March 2019 by Kwik Fit.
Furthermore, drivers in the UK are now spending more than £4bn a year on car repairs caused by these potholes, according to Green Flag.
The Department of Transport announced that £200m would be spent on maintaining and resurfacing 1,000 miles of road, as part of the estimated £10bn required to restore roads in England and Wales to target conditions, according to the Asphalt Industry Alliance.
The huge job of bringing UK roads up to standard means that although spending on road maintenance has actually risen, many describe the focus as being too ‘patch and repair’ rather than the long-term solutions needed.
The issues facing the UK rail network and how they are operated become acutely apparent when I heard about the disruption caused last May following the introduction of new timetables.
The changes caused difficulty for thousands of passengers – particularly in the north – who had to contend with disruption to parts of the network and some trains being cancelled and/or delayed.
The disruption was a major factor in the formation of the Williams Rail Review, an independent review of Britain’s rail network, led by former chief executive of British Airways, Keith Williams.
In July 2019, Williams provided an update on the review at a Northern Powerhouse Partnership event, citing investments happening to improve journeys in the Bradford area, including the introduction of modern trains, upgraded signalling and station improvements. He also mentioned the major upgrade work happening at nearby Leeds station.
High Speed 2
Williams’ update didn’t mention High Speed 2 (HS2) – the first railway to be built north of London in more than 100 years.
Once complete and operational (planned for 2026), HS2 will form the backbone of the UK’s national rail network, connecting eight out of our 10 largest cities – London, Birmingham, Manchester, the East Midlands and Leeds – with almost 350 miles of new high-speed track.
It’s also hoped that HS2 will help pave the way for Northern Powerhouse Rail (NPR) – colloquially known as ‘HS3’, which aims to bolster east-west transport links between major northern cities including Liverpool, Manchester, Manchester Airport, Leeds, Bradford, Doncaster, Huddersfield, Sheffield, Newcastle, and Hull.
However, delays to the timeline and an escalating price tag might affect the speed at which businesses are able to reap the benefits of this huge project, which I’m hearing a lot from clients in our sector.
What does this mean for you and your businesses?
Our need for robust, modern transport connectivity is a strong passion of mine. Working in the Leeds area means that I am acutely aware of the issues many of you contend with on a daily basis.
Like many of you, I know that some regions in the UK require more investment in transport infrastructure and an increase in transport investment comparatively to other regions.
I’d love to hear your thoughts about what can be done about it and how your business is being impacted, so please connect with me on LinkedIn.
Lee Collinson is National Head of Manufacturing, Transport & Logistics at Barclays
*All unattributed images courtesy of Depositphotos.