The future of freight

The future of freight

Commissioner | National Infrastructure Commission

Whether its shoppers making the most of online sales, retailers stocking up their shelves or manufacturers getting crucial parts delivered, our economy increasingly relies on the smooth operation of our freight industry.  

This network – one of the best in the world – delivers to communities from Newcastle to Newquay with few people ever really paying attention to how that is achieved.  

But as more and more of us choose going online over going to our local high street, as manufacturers rely more on just-in-time deliveries, and as the volume of imports and exports rises, the demands placed on freight operators are higher than ever before, and rising. That means the negative effects of increased congestion and carbon emissions are growing and becoming increasingly obvious to members of the public – and the need to tackle them is becoming ever-more pressing.

It is in that context that in November 2017 the Chancellor invited myself and my colleagues at the National Infrastructure Commission to examine the future of freight in this country. In particular, we were asked to consider what the Government should consider doing to support an efficient and low-carbon freight system over the next three decades.  

As we have worked on this study, we have spoken to representatives from right across the industry, including membership organisations as well as companies carrying goods by rail, road and sea, and we received more than 70 responses to our call for evidence. Our initial findings are in no small thanks to these contributions, and we are grateful to all those who participated for their information and insight.

Just over a year later, and what we’ve found is an industry the country can and should be proud of. In 2016 alone, UK freight operators moved an estimated 1.6 billion tonnes of goods. It is an incredibly efficient and effective system operating 24 hours a day, 365 days a year. But that doesn’t mean that there are no problems to solve: while heavy and light goods vehicles only comprise 21 per cent of total vehicle mileage in the UK, they cause nearly a third of the country’s greenhouse gas emissions and nitrous oxide pollution from transport; heavy goods vehicles use a quarter of road space on motorways, and lorries and vans combined make up a third of traffic entering London’s Congestion Charge Zone at morning peak times.

These issues need to be resolved – but we at the National Infrastructure Commission are all too aware of the difficulty that poses for operators in this highly-competitive marketplace. With tight profit margins, companies have become adept at driving out inefficiencies in their own operations – but the wider incentives to reduce negative environmental and other impacts are far too limited.   

In publishing the interim findings of our freight study, we are crystal clear that these issues are not for the industry to solve alone. In fact, our central finding is that a more co-ordinated approach within and between different levels of government will be crucial to supporting companies to tackle their carbon footprint, with action based on better data, and backed by technological advances and clear, firm, long-term targets.

There are three main conclusions to our interim report. The first covers regulation: we’re clear that the regulatory environment for the freight industry must be there to encourage innovation, including initiatives like trials of electric cargo bikes, and enabling ‘real world’ testing of self-driving vehicles. But business also needs clarity from central government about what will be required of it by when in terms of reducing its environmental impacts, and we also want to see local authorities providing greater consistency in the regulations they introduce, including by collaborating more with neighbouring areas to ensure any new rules complement each other.  A prime example of this is the ongoing work towards Clean Air Zones – the Greater Manchester and West Midlands Combined Authorities have been working closely together to design theirs to ensure consistency between the areas where possible. Drivers will be clear what is expected and when, and we want to see more of this from similar bodies.

The second conclusion in our interim report relates to spatial planning.  Understandably, councils up and down the country see the delivery of new homes as a major priority in their Local Plans, alongside the social infrastructure needed to support these new communities such as schools and hospitals. However, the needs of freight operators are too often overlooked. National policy for planning has only two direct references to freight, and councils rarely, if ever, have the resources to consider the industry properly. The consequences of this are already being felt in parts of London, where demand for freight sites significantly outstrips supply.  Although this is currently an issue mainly confined to the capital, it is one that other towns and cities may face in the future, particularly those with limited land available.

We at the National Infrastructure Commission are clear that there needs to be policies to ensure an adequate supply of appropriate space for freight uses is provided, as well as innovative approaches to the building of new facilities such as multi-storey logistics sites. Failure to do this will inevitably lead to logistics operators being based further from where their customers are, leading to longer journeys and potentially causing the very congestion and carbon emissions that the industry so urgently needs to address.

Finally, our interim findings highlight the need for better access to up-to-date and reliable data, to better understand how the freight system operates – especially when light goods vehicle traffic is growing faster than any other vehicle type. We’ve already identified opportunities to do this through new technologies such as mobile data and intelligent Automatic Number Plate Recognition, which among other solutions could give local areas the information they need, and ensure future support and intervention in the industry does what it’s intended to.

In many ways, the freight industry is a victim of its own success: as an effective and efficient system, it is one that all of us rely on but very few of us pay attention to, and as a result, one whose needs Whitehall and Town Halls rarely, if ever, consider when devising new rules and regulations. But with this reliance on freight ever-increasing, the negative impacts of carbon emissions and congestion are being ever-more keenly felt and must be addressed.  We’ve identified the barriers to doing so, and are clear that Ministers, councils and freight operators must work together to make this happen.  

This is an interim report, and so it contains no recommendations but instead highlights what we have found to be the emerging issues facing the freight sector.  As such we remain open to – and, indeed, would welcome - further representations in response to it, especially as we prepare the final report for this study, due for publication this spring.

Our freight industry is world-beating and one that has adapted quickly and seamlessly to a changing and increasingly competitive environment. Nothing we do to support operators should jeopardise that – but for this sector to flourish long into the future, the impacts on our environment and on congestion cannot be ignored.

The interim report from the National Infrastructure Commission’s study into the future of freight is available to download at