Frustration of a one-track planning environment
Brexit: UK ports can't be sure about it, can't get past it and can't ignore it. But, as Felicity Landon reports, they are trying to look beyond it
Anyone following the news in the UK over the past few months could be forgiven for presuming Brexit was the only thing happening in the entire country.
In some respects, they might almost be right. For ports, there has been the well-documented struggle to prepare for the unknown. In January, a survey by Odgers Berndtson found that only 16% of about 100 UK ports and harbour authorities had made any significant or practical plans for Brexit, but 59% were expecting a negative or strongly negative impact. Making those plans has been precisely the issue. In 'normal times', who would commit to substantial investments based on such shifting sands?
In early April, it emerged that the government had only provided 10% of the money needed for no-deal Brexit preparations at Portsmouth, saying that the estimated risk of disruption did not warrant extra funding. This was despite warnings from port director Mike Sellers that with only 13 lorry lengths between the port and the motorway, delays caused by post-Brexit customs checks could cause congestion across the city, as well as severely hampering supplies to the Isle of Wight and the Channel Islands.
In fact, the political deadlock over the UK's future relationship with the EU has had more than the obvious direct consequences.
“There is obviously a lot of discussion around the detail of short-term arrangements, Customs and so on,” says Tim Morris, chief executive of the UK Major Ports Group. “But for the large majority of ports, there is a sense of looking beyond the noise of Brexit and holding on to the real fundamentals of geography and the importance of maritime trade to the UK and keeping that backed up by a continuing strong record of investment.
“Within that, there is a lot of work going on for everyone, not just those handling accompanied roll on-roll off (ro-ro), in terms of preparation for Brexit. That is not only dealing with government but also working with customers to inform them of the different systems and work through different situations — for example, storage short and long-term and reconfiguring processes.”
However, while that is going on, there is a deep sense of frustration among ports for two reasons, says Mr Morris.
“First, the normal business of regulation and policymaking has essentially ground to a halt — meaning that day-to-day things like dredging disposal licences and engagement with the Marine Management Organisation and people in Defra are at a standstill while everyone prepares [for Brexit] within their own organisation or has been seconded to other organisations.
“The other bit that has ground to a halt is some of the policy management work that has, or should, come out of the Maritime 2050 vision. This had some really useful, important and ambitious things in it around infrastructure developments and the use of land around ports, which are obviously very important for my members; these have simply been parked while the whole of the Department for Transport essentially focuses on Brexit preparations. It is deeply frustrating for all ports.”
A large subset of ports has a second frustration, says Mr Morris: the heavy Brexit focus on accompanied ro-ro and the Port of Dover in particular. “While no one would debate that Dover has a unique combination of risk factors in a 'no deal' situation and it is an important port, the mono-focus of the government preparation and media attention has been a source of significant frustration not just to general cargo/container ports but also other ports handling significant quantities of ro-ro activity. That isn't helpful – a solution that might work for that very specific context might not be the right solution for a container port or a ro-ro port in a different location with a different set of circumstances. And that is regardless of whatever the political settlement is.”
Richard Ballantyne, chief executive of the British Ports Association (BPA), is thankful that the sector at least has “a good and stable ports policy regime, which for the most part is fit for purpose and not providing barriers or problems to the industry”.
However, he highlights frustration around the marine consenting environment. “We have largely reached the mature stage in terms of marine designations – i.e. MCZs, SACs, SPAs, etc. – so for the most part we are not expecting any new designations. But in terms of what existing designations mean, it has caused problems for developers and ports seeking consent.”
The BPA estimates that 70% of UK harbour authorities have some form of marine designation in or adjacent to their harbour area. That means that a full impact assessment and costly monitoring exercises are required for any proposed development and these can delay consent substantially, says Mr Ballantyne.
“We are working with the UKMPG and government looking at ways to improve permitted development rights – i.e. the right to do certain things without planning permission – but again they are trumped by the environmental designation.”
The Maritime 2050 strategy, published in January, features port economic zones. These are yet to be defined, but Mr Ballantyne would like to see freeports set up with a wide scope to include enterprise and development, preferential planning and business rates, business stimulation, and skills and training, alongside rules that allow duty payments to be deferred.
Updating the port master planning regime would also be important, “so not only residents living nearby but also local authorities, regional government and sub-regional transport bodies recognise ports' aspirations and activity”, he says. “Master planning gives ports the opportunity to express their long-term aspirations and business plans with key stakeholders as well as residents.”
Charles Hammond, chief executive of Forth Ports and chairman of the UKMPG, foresees supply chains shifting post-Brexit, with a shift likely towards unaccompanied freight. That's particularly the case as a shortage of drivers and more emphasis on work-life balance means road haulage will become more regional and less long-distance, he believes.
“Dover will still have an important role to play but rather than focusing so much through Dover with long lorry journeys, people will start to look at shipping in a different way,” he says. “You can't and should not force markets to do things but it's inevitable that we will see that type of shift.”
South East England, particularly the London area, is underweight in warehousing compared with population, while the Midlands is probably the reverse, says Mr Hammond. “And a lot of goods landed into the South East go to warehousing in the Midlands – and then back to the South East.”
Mr Hammond also says that if ports are facilitators of trade, then the land around ports should add value to the trade flows. “We should have a specialised and benign planning regime around ports, and the best connectivity around major ports.”
Planning processes should make it easy to invest and start up businesses in land around ports, he says. “Having laid out that agenda within the industry, we are saying to the government, rather than just talking in a general document, let us see some specific policies on this.
“The purpose of a port is to facilitate efficient supply chains that make people's everyday lives stable and easier.”
Mr Morris agrees: “The ambition is to put all economically viable land around ports into productive use. If you could achieve even half of that, it would be transformational in terms of development, jobs and communities.”
INVESTMENT STILL FLOWING
The UK major ports sector has seen a consistent record of steady, significant investment, adding up to roughly £600m a year since 2015, says the UKMPG.
Among the developments currently underway are Dover's Western Docks Revival, Aberdeen's £350m harbour expansion, Felixstowe's investment in new ro-ro facilities for DFDS, Forth Ports' Tilbury2 expansion and ongoing logistics developments at London Gateway.
“There are also many smaller but important projects to improve capacity and capability – for example, Bristol improving capacity in the container yard and in bulk handling, and ABP's container expansion on the Humber,” says Tim Morris. “That is a trend we are seeing continue.”
A notable trend is in developments not directly related to cargo volumes, says Richard Ballantyne. “Aberdeen's main aspiration is serving the offshore energy sector in the North Sea; the expansion isn't about direct cargo growth. Other east coast ports are looking at this, especially Blyth and Lowestoft, which are important hubs spaced out from Aberdeen down the east coast – and other ports can do similar.
“In terms of old-fashioned conventional tonnages, they are not so high, but in terms of value and the jobs they generate and high-level skills required, they punch way above their weight.”
The Government's pledge to increase offshore wind power by 30% by 2050 is very exciting for ports. Also very relevant is the requirement for a specific level of UK content in UK developers' projects, he says. “Basically, it means a percentage of content must be done in the UK, and means UK ports will be best placed to service that.”
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