Transport and the Economy

Mark Pawsey Excerpts

Tuesday 28th February 2012 Commons Chamber

[Julian Sturdy]

Absolutely. Tourism is also a key element in York’s local economy and the congestion is having an impact on the tourism level in the city. Sadly, my local authority in York would rather tinker with small-scale schemes than take the difficult long-term decisions that will safeguard the city’s economic future. As I mentioned at the outset, we need a fearless transport strategy. We need a long-term approach to investment at a national level and implementation locally. The Government’s £3 billion of capital for local road projects outside London, to be spread over the next four years, is therefore a welcome starting point, but is that the sum part of a long-term strategy for our roads? The crux of road investment is long-term, joined-up thinking.

I shall now discuss another form of transport. We have to tackle aviation issues seriously, and we face two problems. Airport capacity in and around London is at breaking point. We should be enormously proud that our capital city has remained resilient over a number of years, maintaining its position as the best place in the world to do business. Although international politics and powers have changed, London has remained at the top table, with a positive knock-on effect for the rest of the UK. However, if we refuse to expand our capacity, we risk throwing away our the capital’s crown and, again, our economy, both nationally and locally, will suffer.

[Mark Pawsey (Rugby) (Con)]

Does my hon. Friend agree that some of the slack that exists in regional airports could be used to deal with the shortage of capacity at Heathrow? I am thinking, in particular, of Birmingham airport, which is just 90 miles away from Heathrow.

--- Later in debate ---

[Mark Pawsey (Rugby) (Con)]

It is a great pleasure to follow the very thoughtful contribution of my hon. Friend the Member for Warrington South (David Mowat). It is not the first time I have followed him. I first did so 45 years ago when we were both at school in my home town of Rugby.

I am pleased that the Select Committee noted the importance of investment in the transport system as a driver for growth. As a Member for a constituency in the centre of England, where warehousing, haulage and logistics businesses are a key part of our local economy, I shall focus on the road networks and links of which they take advantage. First, let me say a few words about my role before I arrived here. I was the owner of a business involved in the distribution of catering goods around the midlands, and an efficient road network was vital to our operation. My business was based in Rugby, because that is my home town, but I often told people it was based there because I looked at the UK and chose Rugby as the best possible place for a distribution business. We have the M1 taking us north to Leicester, Nottingham and Derby and taking us south to Northampton, Milton Keynes and London; we have the M6 taking us west to Birmingham and the west midlands conurbation; we have the A14 taking us to the east midlands, Kettering and Corby; and we have the A46 taking us south-west to Stratford-upon-Avon and the Cotswolds. The examples I am about to provide of the importance of the road network could apply to hundreds of thousands of businesses across the UK.

My business provided a delivery service, and the measure of our performance was the number of deliveries our vehicle was able to make during the working day. The more deliveries it made, the better and more efficient my business. That was affected by the efficiency of our route planning and by how well the road network was working—by the physical layout of the roads, and the opportunities to use new roads and bypasses to avoid bottlenecks and any hold-ups that were occurring. We sold to our customers with a promise of, “Order today, delivery tomorrow,” in order to minimise stockholding. Our ability to honour that promise depended on the efficiency of the road network and we prepared our loads according to known road conditions. We would know about big contraflows and closures and we might adjust the load on a given vehicle accordingly. Having advance notice of closures and delays is important to such businesses, and I know that the DFT has improved its performance in that area. When a van was out for longer or was not able to make its deliveries, we incurred overtime payments to staff. If a customer did not receive their goods on the allocated day, we had to load the goods on to an additional vehicle at an additional cost to the business that could not be recovered from the customer.

I also employed a team of sales people who would go out and visit customers. Again, the more calls they could make the better, and the cost to my business of an expensive executive sitting in a car in a motorway traffic jam was a significant burden. Both the delivery aspect of my business and the sales team were affected by congestion, which can be caused by overrunning works, the over-zealous placement of cones, unnecessary lane closures when no work appears to be taking place and extended motorway closures after incidents. I acknowledge that the Department has undertaken work to reduce such situations, but there are still massive frustrations to the road user and effects on the efficiency of businesses.

It is important to consider the contribution that the distribution, haulage and logistics sector makes to the UK economy. It is estimated to be worth about £10.7 billion and to employ about 293,000 people. In 2009, the Road Haulage Association estimated, in giving evidence to the Transport Committee, that

“a UK-based haulier pays around £25,000 in fuel duty each year for a typical articulated HGV, amounting to some £2 billion per annum for all lorries in the UK.”

More recent calculations suggest that the industry’s annual contribution in fuel duty has risen to as much as £4.57 billion.

The Government have announced a total of £3 billion a year of spending on new strategic road schemes up to 2015. In the current spending period, they will receive £14 billion in income while they are spending £3 billion on new road networks, so there is a massive surplus to the Exchequer that is available to the Government to spend on other services. What does the logistics industry need to help it to generate that income? It needs investment in the road network, so I am pleased that that is mentioned in recommendation 2 of the Select Committee’s report. It also needs the motorways to be kept free. Blockages and lane closures are not only frustrating but incur a substantial cost. I note that the Select Committee’s report, “Out of the jam: reducing congestion on our roads”, said that jams could cost the UK economy £24 billion a year by 2025.

This has been a very valuable debate. My constituency will benefit from the £3 billion allocated to capital spend on road networks over the next four years and we are delighted that many projects, including the one at the Catthorpe M1-M6 junction, are going ahead. All that work together will enable us to generate economic growth over the coming years.