Rural Affairs Committee, 02 Nov 1999

Meeting date: Tuesday, November 2, 1999

Official Report 293KB pdf

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Rural Areas (Transport)

The next item on the agenda is transport in rural areas. That is why Mr John Dowie is here—I apologise to him for what happened earlier.

We note that lead responsibility for rural transport lies with the Transport and the Environment Committee, but this committee has always said that it believes transport is an important issue in which it wishes to be involved.

We have received a submission from the Scottish Executive development department. Mr John Dowie will speak on this issue.

That is correct.

I am glad that we have got that sorted out.

I will not say very much by way of introduction as I want to take questions on the paper that we submitted to you. The transport and planning group in the Scottish Executive development department under Sarah Boyack leads on rural transport issues, but we work closely with colleagues in the rural affairs department.

A range of transport measures is directed at and is specific to rural areas. There are measures for lifeline links, particularly to the remote islands and, of course, mainstream programmes such as the roads programme have a bearing on rural areas and other parts of Scotland. Rural issues are diverse and occupy the time of a diverse range of people in the development department.

I will be happy to take questions arising from the paper.

Are there any comments or questions on the Scottish Executive's background note on rural transport?

Are vapour recovery exemptions for rural petrol stations permanent, or is an annual gallonage—litreage nowadays—limit set?

I do not know the detail of that exemption. My understanding is that it was for a period of time.

So the exemption is temporary and then petrol stations have to fit vapour recovery equipment.

I would not want to commit myself on that as I am not sure. I will clarify that point if that would be helpful.

Yes.

Section 20 on the logistical requirements of the Scottish forestry industry says:

"Amongst options being investigated is the potential for moving more timber by rail."

I am aware that local authorities in areas with a large amount of forestry, such as Dumfries and Galloway, are concerned about how they will be able to make sufficient money available to upgrade roads to the requirements of the forestry industry. Although trying to move more timber by rail is admirable, the timber has to get to the railhead, so roads will still have to be upgraded.

Can you give more detail on how some of those improvements might be financed without putting an undue burden on local authorities, which already have problems maintaining their road systems?

The main way in which the Scottish Executive can contribute is through freight facilities grants which, as you correctly say, kick in only once timber reaches the railhead. Circumstances differ in different parts of the country depending on the proximity of forests to the railhead. Funding of £6 million over three years is available, some of which could be used to install equipment to help with the transfer of timber at the railhead. Colleagues are considering a number of bids for funding to do that.

You are absolutely right: that does not help with the movement of timber to the railhead. In the first instance, it is for the local authority to consider the priorities across its road network and to prioritise in ways that fit with the future forestry crop.

There is an enormous amount of timber on the west coast of Scotland, but further north there are very few rail links. Surely we should be using coastal shipping for that, as we used to in the old days. Would there be any chance of bringing back the tariff rebate scheme? A few years ago, a lot of timber was carried by ship. That timber is now carried by road. The scheme would save an enormous amount of wear and tear on the roads and I am sure that it would pay for itself very quickly.

There are no plans to extend the tariff rebate subsidy to cover that sort of cargo, but the Executive plans to legislate—either in Scotland or via Westminster—to permit subsidies to be given to facilitate the carriage of timber and other goods by coastal shipping. That will allow the £6 million I mentioned earlier to be invested in equipment at docks to allow the transfer of timber and other goods.

The freight facilities grant is all very well for capital schemes, but not when it comes to running costs—something else is needed. If, for example, 200,000 tonnes of timber, were taken off the west coast, it would save around 7 million or 8 million road miles and would cost about £2 million. That does not seem much in terms of the damage that is being done to the roads.

The Executive hopes that if we can pump-prime the initial capital investment, we will be able to facilitate commercially viable transfer from the roads to coastal shipping. That is what happens with the freight facilities grant on the rail network—once the equipment is installed, moving freight by rail becomes commercially viable.

Am I right in thinking that freight facilities grants have been available for some time? It is not an innovation. Can you give us a candid assessment of how successful those grants have been in rural Scotland?

In Kyle of Lochalsh, a siding or something was installed recently. I have been told that only one train ever went out of it and that it has now been junked. Have the grants been a realistic proposition?

I suspect that the example you are thinking of does not involve a freight facility grant. The problem that we have had hitherto is that the take-up in Scotland has been zero. However, during the past 18 months much more progress has been made in securing good quality bids and in making awards. One such award was made to the Sainsbury's Inverness link, which is an extremely good project.

We have been making more progress. Previously, the budget has been underspent, but we are now on target to spend the money on good value projects. The situation is much more promising than it was a few years ago.

I have another question on railways. You mention the feasibility study into the Borders rail link. If it recommends that the north passenger section from Melrose to Edinburgh is worthy of support, is any money available for it?

Ministers will have to consider overall priorities in the budget in the light of the conclusions of the feasibility study. It would not be a cheap project.

I would like to add to the point that Dr Murray made, because it is important that the Executive understands how important the problem is. Some forestry companies have applied for extract licences for timber, only to find that—for understandable budgetary reasons—local authorities are not able to upgrade the roads to the necessary standard. The economic return on forestry is not great. Local authorities are suggesting that forestry companies pay for road upgrading, but the companies cannot afford it. We are in danger of developing blocks of forestry that have reached their maturity but will not be extracted, even though they are in accessible areas. The trees will go to rot and will constitute a great waste of taxpayers' money. The situation is unacceptable.

I recognise the problem generally and the problem with maintenance at a local authority level. Local authorities are provided with block funding for their capital requirements across the range of local authority functions. They must decide what to prioritise out of the competing demands of education, housing, roads and so on. The Executive recognises that, in recent years, transport has been losing out in that process of prioritisation.

The grant-aided assistance figure applies to the roads for which the local authority is responsible, not to additional roads. In that sense, a burden is being placed on local authorities because they are having to extend the road network while receiving finance only for existing roads.

I am looking at the item in terms of rural partnerships and social inclusion partnerships. There might be scope for the encouragement of joint delivery of public services in remote areas. There is nothing in the document about supporting voluntary organisations, such as councils for voluntary service in Scotland, that deliver services across vast distances. Transport costs are crippling for voluntary organisations, some of which are funded directly by the Scottish Executive. Has any thought been given to how they will be supported?

Voluntary organisations have a crucial role to play and in many cases it is those local organisations that get money for specific schemes.

In that case, the document should refer to voluntary and community organisations rather than public bodies. It is important that the work that such groups do—particularly in rural areas—is acknowledged.

Mr McGrigor made a suggestion about getting some freight onto rail and into the harbours. You used a different word: docks. We do not have docks in the remote areas of Scotland; we have little fishing harbours that are sometimes used to transport freight.

Some excellent initiatives are being promoted in relation to Mr McGrigor's suggestion, although they are at an early stage. I heard mention of the initiative that was promoted in Kyle of Lochalsh, on which a great deal of money was well spent. The enthusiasm was there to deliver the freight—particularly timber—by rail to Kyle of Lochalsh. Sadly, most of the freight that comes in to the western isles comes by road. Why that should be, I do not know: the facility is there to handle the freight. The freight handling company of British Rail is dragging its feet and should be encouraged to get more freight onto trains.

Last weekend, I heard that one of the big freight-to-rail initiatives, involving a supermarket company delivering to the north of Scotland, had adapted a magnificent container system for the route. That system takes goods to the north, to Inverness, from where it is transported to the peripheries and the far north. An initiative was proposed locally to back-load the containers with dairy products from Inverness and the Sutherland region to take them to the central belt. Apparently, that is not permitted under the regulations. The container is coming back empty. That seems stupid. Because of the grant award, the containers are dedicated to freight for the supermarket—and nothing else. This is an opportunity for sensible co-operation, which would generate some traffic on the rail network.

Jamie McGrigor made an excellent point about the small harbours and the rail freight handling facilities. We must not forget that we have to transport the commodity over substandard roads to get to the pier or the railway station. We must not forget the tremendous expenditure that is still required to support and extend the infrastructure.

My use of the word docks was not meant to imply large facilities only—any transfer point from land to sea is appropriate, excluding beaches. The issue of back-loading has been raised by many people and we are currently considering the possibilities. However, members will appreciate that there are rules to avoid cross-subsidy and to achieve value for money. It is not straightforward. I also acknowledge the point that one has to use the roads to get to a railhead or a dock.

Are there any further questions? It has been pointed out to me that many of the questions have revolved around freight transport in rural areas. Do members think that we should be paying particular attention to that issue?

Members indicated agreement.

We will note that and include it in our continuing investigation.

It has been drawn to my attention that the Enterprise and Lifelong Learning Committee is currently carrying out an inquiry into the issue of differential petrol prices. It has been suggested that two members of the Rural Affairs Committee could be appointed as reporters to participate in that discussion. Are there any suggestions as to which members might be appropriate?

It is a matter of particular concern to members from the Highlands, and I think that at least one of the representatives should be from the Highlands.

Is the inquiry on differential petrol pricing alone? Some of the earlier parts of the document that we have been discussing refer to the effect of the fuel price escalator on petrol pricing. I am not clear what it has to do with differential petrol pricing.

The description I have been given indicates that we have a standard invitation to become involved in the committee's inquiry.

As I am a member of both committees, I can clarify the issue. I understand that the Transport and the Environment Committee will consider the issue of the fuel price escalator. The intention of the Enterprise and Lifelong Learning Committee is to consider the effects of the pattern of different prices in different parts of Scotland. As I said at the last meeting of the Enterprise and Lifelong Learning Committee, that would be of particular interest to members of the Rural Affairs Committee, because rural areas suffer the disadvantage of the variation in fuel prices.

I nominate John Farquhar Munro.

I nominate Rhoda Grant.

I nominate Irene McGugan.

John Farquhar Munro, Rhoda Grant and Irene McGugan have been nominated. Do we have a view on how we want to be represented? I do not want to have a vote on this question.

This issue certainly does not just affect the Highlands and Islands. I accept that differentials are much higher on the islands, but there are significant differentials elsewhere, so a wider representation might be helpful.

As someone who lives in the north-east, I have the impression that the problem of differential pricing does not exist in the Aberdeen area to the same degree as in the Highlands and Islands. On Friday night I heard Alex Salmond say that his constituency had some of the lowest petrol prices in Scotland—I can only take his word for that.

Maybe Alex Salmond just knows the right place to go.

There is nothing to stop any member of this committee attending and being included in the business of meetings of the Transport and the Environment Committee. We are simply appointing reporters, who will report back to us. Given that there are a number of political balances in this committee to consider, would it be appropriate to have one reporter from within the Executive group and one from outside it?

Only from an Opposition point of view.

The clerks have suggested that we appoint three reporters if we can get away with it. We will do that—if that course of action fails, we will have to reconsider.

I thank Mr Dowie, who is leaving the meeting now—he has been very helpful.