Funding of inland transport links to ports: a comparison of UK and continental experience.

The UK Government is undertaking a review of its ports policy against a background of unprecedented levels of stock market interest in the ports industry. The constitutional make up of the UK ports industry, with 40% of ports private and 60% in municipal ownership or operating as trusts makes the formation of policy which is efficient, equitable and supportive of port development especially challenging. The ports themselves have diffuse interests and are represented by two trade organisations. Within any port there are pure public good activities, such as provision of common user facilities for ships and river basin and coastal conservancy which arguably could be part-funded by public money. Against these factors affecting ports core business, the progress of schemes to improve inland transport links such as rail gauge enhancement and highway access improvements is either tortuous and slow or not happening at all. Ports are not accorded any special status, and the private sector may at any time walk away leading at the very least to losses in traffic and economic development and at worst to further delays in infrastructure development. This paper draws on the information gained from studies for the nine English regional development agencies, individual ports and international experience to propose new funding mechanisms for road and rail links to ports. A review of UK and continental experience is provided. This includes: collation of evidence on the wider economic benefits of ports, which cannot be easily recovered through tariffs, in the UK and Europe; use of space; a rationale as to why ports should be treated differently from other developers; collection of traffic data to establish the circumstances in which port traffic can be a significant proportion of total traffic; and a review of funding mechanisms, in the UK and mainland Europe to examine whether links to ports are accorded any special priority and how these are being funded. Financing mechanisms to accelerate the delivery of inland links to ports are proposed based on sound economic principles, consistency with EU State Aid and other rules and taking account of funding sources such as (in the UK) the Transport Innovation Fund. For the covering abstract see ITRD E137145.