As part of the periodic review of Railtrack's access charges for franchised passenger train services, the Regulator made a commitment to undertake a review of freight charging policy for completion in 2001.
This review was published on 18 October 2001 and the conclusions established that there were strong reasons for reducing the access charges paid by freight operators for use of the rail network and for the introduction of a more transparent and deterministic charging framework. The effect of the review was that the charges that freight operators pay to the network operator will be on average halved.
The changes in freight charges should facilitate growth in rail-freight, contributing to the Government's objective of a substantial increase in the period of the Ten-Year Plan and delivering social and environmental benefits by relieving road congestion and reducing air pollution.
The review represents a radical shift from the previous negotiation-based approach to an essentially tariff-based approach. It takes account of increased competitive pressures from other transport modes and recent decisions on 44 tonne lorries and vehicle/fuel duty which have given road haulage a competitive edge over rail. The shortfall in the network operators revenue from freight operations resulting from the freight charging review, some £500 million over the current control period, will be funded by the Strategic Rail Authority.