Freight & Logistics Policy
The costs and benefits of freight & logistics
The freight and logistics industry, which is made up almost entirely of private sector businesses, is the lifeblood of a country’s real economy as it ensures that manufacturers receive their raw materials and components and are able to distribute their products to customers and it allows retailers to have a wide range of goods for consumers to purchase. While the amount of freight transport fluctuates with the business cycle, the industry is very competitive so that any cost reductions achieved by individual businesses are passed onto their customers through lower prices. The freight and logistics industry is also a major employer in its own right, with job opportunities available both with transport operators, in distribution centres and at ports and airports; the UK Government says the industry accounts for 9% of the country’s GDP and 7% of its total employment.
At the same time, however, freight movements are a source of environmental emissions, contribute to congestion and generate noise. At a local level the diesel engines that are used by most road freight vehicles emit particulates which are damaging to human health and freight transport is a significant contributor to global warming. As some of these costs to society are not included within the financial costs incurred by freight operators and their customers, there is a role for public policy-makers to intervene in the market to balance the needs of private operators with the wider needs of society.
European freight transport policy
The European Commission has set out a vision for freight transport and logistics for 2030 and beyond where significant volumes of medium- to long-distance freight flows switch from road to rail and waterborne transport via freight hubs, such as rail-connected distribution centres and ports. So-called “last mile” deliveries and collections from these hubs into urban areas would then be by very low emission freight vehicles carrying out consolidated deliveries, with greater use of quiet night-time deliveries.
UK freight transport policy
The UK Government’s freight transport policyis set out in its Logistics Growth Strategy (published in November 2011), which was the result of a consultation exercise with the freight industry. The policy approach is, in general terms, to introduce measures that increase the competitiveness of the UK industry by reducing its cost base, reducing planning barriers and enhancing infrastructure that can improve journey time reliability.
Freight policy at a local level
Little guidance on freight policy is provided by central government to city regions and local authorities in the UK, despite the fact that freight transport has a direct impact on local areas by contributing to road congestion, reducing air quality and, more generally, affecting the quality of life for residents and visitors. However, the Local Transport Plan process and the existence of Freight Quality Partnerships in many areas provide the institutional basis for more effective freight transport policy-making at a local level. These policies need to be based on knowledge of the freight industry and an integrated, evidence-based approach to policy-making that develops bespoke packages of policy measures to incentivise the freight and logistics industry and its customers to adopt more “virtuous” behaviour.
With its knowledge of the freight and logistics industry and its understanding of freight policy at a European, national and local level the consultancy has particular expertise in the following policy-related areas:
- Economic impact analysis of new freight policies, regulations and charging structures
- Freight strategy and policy development
- Freight data analysis, forecasting and modelling
- Planning, policy and needs cases for logistics developments, such as rail freight distribution parks and port facilities
- Options development for freight infrastructure
- Freight transport grant applications
Urban Freight Transport Capability Statement