Rail freight may be undermined by a UK government decision to reduce funding by more than 20% funding for a grant encouraging a modal shift from road. The Department for Transport (DfT) has reduced the annual Mode Shift Revenue Support grant (MSRS) from £19.7m to £15.7m. A further £500,000 reduction is expected next year.
More than a million freight journeys were transferred from road to rail last year. Budget cuts may result in rail freight proving economically unviable and 200,000 journeys returning to road.
Philippa Edmunds, from Freight on Rail, said that she was “incredibly disappointed” with the government’s decision and called on it to rethink. “These grants make a very big difference to pollution and congestion,” said Ms Edmunds. “HGVs pay less than one-third of the cost they impose on society, which allows them to undercut rail prices.”
Research conducted by Freight on Rail suggests that freight lorries cost the government £6.5bn a year in increased road crashes, dirty air, potholes and other impacts. She added: “Reducing this grant will undermine rail freight’s ability to compete and will result in less confidence in the industry. Government urgently needs to address these distortions.”