Contact: Tony Cook, tel: 02380 333067

1. Summary

1.1 The following decisions are sought:

(i) That the South East England Regional Assembly be informed that the County Council considers that the Regional Ports Study is a useful contribution to the preparation of port policies.

(ii) That the South East England Regional Assembly be informed that the County Council considers that any future ports strategy should have an aim to include an appropriate examination of alternatives including the impact of developments at European ports.

(iii) That the South East England Regional Assembly be informed that the County Council considers that a suitable approach to the formulation of port policies for deep sea container facilities should be based on a sequential approach which involves:

(a) making maximum use of existing utilised port land;

(b) for new expansion sites, taking a wide consideration of alternatives, utilises the core strategy of Regional Planning Guidance Note 9 to determine priorities, and takes into account current development plans;

(c) utilising brownfield sites in preference to greenfield sites if this resulted in less environmental damage;

(d) ensuring that all new development is sustainable with any fundamental environmental effects having a suitable, achievable mitigation package; and

(e) ensuring that any new expansion site can be integrated and accommodated with the road and rail network, and provide a sustainable port travel plan which caters for all forms of transport.

(iv) That the South East England Regional Assembly be informed of the detailed comments in section 6 of the attached report on the regional ports study, the preparation of ports policies for the Regional Transport Strategy and the emerging draft policies.

(v) That the County Council would welcome further dialogue with the South East England Regional Assembly as port policies for the Regional Transport Strategy progress, and the Director of Environment, in consultation with the Executive Member, be authorised to make further representations to the South East England Regional Assembly on the policies, as necessary.

2. Reason

2.1 The South East England Regional Assembly (SEERA) has published its draft Regional Transport Strategy (RTS). Subsequently a regional ports study has been produced. SEERA is now preparing port policies for inclusion in the final version of the RTS. The County Council is submitting comments to SEERA on the study and the preparation of policies for the RTS.

2.2 The attached report was considered by the Environment Policy Review Committee on 16 October 2002. The Committee supported the recommendations but emphasised the importance of considering the context of European port developments and the need for wide ranging port travel plans. As a result, specific reference to these matters has been incorporated into recommendations 1.1 (ii) and (iii)(e).

2.3 Possible draft port policies are beginning to emerge from SEERA and the Environment Policy Review Committee was made aware of this. SEERA has identified some key messages which are emerging from this work but it feels that the way forward for the deep sea container port market is less clear. SEERA expects to undertake further dialogue especially with bodies in the other regions of London and the East of England. SEERA is currently finalising the RTS in order that it can be formally submitted to the Secretary of State at the beginning of 2003. To this end, it is intended that the proposed port policies for inclusion in the RTS will be considered by SEERA's Planning Committee on 18 December 2002.

3. Other Options Considered and Rejected

3.1 Not to offer a response to the South East England Regional Assembly.

4. Conflicts of Interest Declared by the Decision Maker or a Member or Officer consulted - None.

5. Dispensation granted by the Standards Committee - Not applicable.

6. Reason(s) for the Matter being dealt with if Urgent - Not applicable.

Approved by: Date:

Councillor K B Estlin

7475/TC

Contact: Tony Cook, tel: 02380 333067

1. Summary

1.1 The South East England Regional Assembly (SEERA) has published its draft Regional Transport Strategy (RTS). Subsequently a regional ports study has been produced. SEERA is now preparing port policies for inclusion in the final version of the RTS. This report examines the key issues in the regional ports study and provides comments to SEERA on the study and the preparation of policies for the RTS.

2. Background

2.1 On 5 June 2002 the Environment Policy Review Committee considered the draft RTS. It was noted that certain studies were still awaited including a regional ports study commissioned by the South East and Anglian Ports Local Authority Group (SEAPLAG). This organisation had previously appointed consultants to undertake a study to provide a regional policy framework for the development of ports and related regional transport infrastructure.

2.2 In July 2002 SEAPLAG forwarded the consultants final report to SEERA. The Executive Summary of the South East England, London and East of England Regional Ports Study is attached as an appendix. A full copy of this study is available in the County Surveyor's and County Planning Officer's Library.

2.3 Ports associations and some individual representatives of the ports industry have expressed deep disappointment with the outcome of the report. It is felt that the approach in the study is misconceived and is inconsistent with their view that investment in new port facilities should be based on market principles. It is also felt that there are errors in the report and that the traffic forecasts are questionable. Some comments challenge the findings of the consultants on those projects which represent the best fit with a range of planning objectives.

2.4 The regional ports study is a technical piece of work and is not a formal policy statement on ports. SEERA has indicated that it will form one of a number of contributions to the process of developing policy statements. SEERA has also been undertaking a dialogue with the ports industry over the summer months.

2.5 SEERA will subsequently identify a set of policies on ports for inclusion in the RTS. SEERA will consider the final version of the RTS at its Planning Committee in October and its Plenary in November 2002.

3. Current Policy Framework

3.1 A policy framework for ports is provided at the national, regional and development plan level.

3.2 Modern Ports: A UK Policy was published in November 2000 and presents the broad policy aims of the Government for UK ports. At the national scale Modern Ports: A UK Policy identifies there would be support for new port development where there is a clear need but each case will be determined on its merits. New port development must be sustainable, produce significant additional benefits, use certain tests and be demonstrably commercially viable. Modern Ports: A UK Policy states particular cases should be considered within the strategic context provided by regional guidance and regional transportation strategies.

3.3 The Government's advice on transport is provided in Planning Policy Guidance (PPG) Note 13. The PPG includes specific advice on planning for port development. It identifies that care needs to be taken in allocating sites for port use to ensure they are viable to avoid unnecessary blight and secure the economic and regeneration benefits of developing sites for port uses. This guidance indicates there should be rigorous appraisal of new facilities.

3.4 At the present time there are general regional policies which apply to port development. Regional Planning Guidance (RPG) Note 9 Policy T7 states that "the sustainable development of seaports and port facilities (including road and rail access to them) should be supported for international deep sea, short sea and coastal shipping". RPG9 indicates that development plans should identify and safeguard land for interchange facilities and access improvements to ports, and appropriate sites of port use that will be required to meet changing market needs. It is envisaged that development strategies should be provided for port facilities and access to them which are sustainable and make best use of existing facilities. In addition the development strategy should carefully consider the wider spatial strategy of RPG9.

3.5 There are other general policies in RPG9 covering transport, economy and the environment which are relevant to port development. RPG9 recognises the regeneration of the Thames Gateway as a national priority. Other priority areas identified at the regional level for economic regeneration include South Hampshire, East Kent (including Dover) and the Tendring Coast (including Harwich).

3.6 RPG9 also notes that a study is required in order to develop a more regionally specific ports strategy. This would need to cover ports in the South East, East of England and London. This is the study which has subsequently been undertaken by SEAPLAG.

4. The Regional Ports Study

4.1 The consultants final report has examined the challenges facing ports in the future. It has identified guiding strategy principles. It has undertaken an appraisal of major container terminal proposals and the potential development of new roll on-roll off (ro-ro) facilities. The implications of the strategy for individual ports has also been included in the study, as well as landside infrastructure implications.

4.2 The study area covers South East England, London and the East of England extending from Poole around the coast to Kings Lynn. It has included principal ports in this area, including consideration of the Channel Tunnel, but the report has not examined any of the smaller harbours and wharves.

4.3 The report identifies the economic context of the importance of ports in the study area to regional and national economies in the UK. Ports are noted as vital links in the transport chain and rely on land transport infrastructure to work efficiently.

4.4 Overall the consultants have estimated that goods traffic through the main ports in the study area will grow by 45% between 2000 and 2016. In the container sector considerable growth is anticipated by the consultants with a base case growth of 3.2% per annum. The heavy goods vehicle (HGV) ro-ro sector is forecast to grow by 3.7% per annum. In the same period the consultants anticipate the passenger ferry sector is forecast to double (a 4.3% per annum growth rate).

4.5 The consultants have examined the capacity of the ports in the study area to meet the predicted demand in order to determine the scale of the potential shortfall. It is considered that current container facilities will be exhausted by 2009 and by 2016 new capacity for 1.4 million TEU (twenty foot equivalent unit) will be required. Similar shortfalls are forecast for the ro-ro sector with new capacity for 1 million HGVs needed by 2016. A capacity estimate for passenger growth was not undertaken by the consultants.

4.6 The consultants examined a range of general strategy options (a baseline strategy, an environment-led strategy, a regeneration-led strategy, a market-led strategy, a regional transport diversion strategy and a new port strategy). Stakeholders were consulted on the options in early 2002. The market-led strategy found most favour amongst those involved in the ownership and management of ports while the environment-led strategy was preferred by environmental bodies and groups.

4.7 The regional ports study sets out an overall aim of a preferred strategy and a set of guiding strategy principles. The overall aim is to "accommodate the development of ports in the most sustainable way to meet the needs of the UK and regional economies. Where harm is considered necessary to the economic, social or environmental fabric of the region to meet these needs, it should be minimised through consideration of a full range of alternatives". The guiding principles are:

(i) ports are key gateways which should be respected and planned for when individual developments are considered;

(ii) the best use should be made of existing facilities;

(iii) port proposals brought forward by a market view must be assessed against the guiding principles;

(iv) specific developments will be considered on their own merits within the context set by national, regional and local development plan frameworks;

(v) port developments must be guided by sustainable development principles;

(vi) the protection of the environment must play a central role in determining proposals;

(vii) port developments that assist the regeneration of local communities will be particularly favoured;

(viii) outside public sector pump-prime funding should be demonstrated to not significantly distort the market; and

(ix) the land side transport considerations of port developments need to be assessed and where the impact is severe, new port proposals should be rejected.

4.8 The consultants undertook an appraisal of major container terminal proposals at Dibden Bay (2.6 million TEU potential capacity), Bathside Bay (Harwich) (1.7 million TEU), London Gateway (Shellhaven) (3.4 million TEU), Thamesport (Medway) (1.5 million TEU) and a small extension of the Felixstowe Trinity Terminal. The consultants' view was that London Gateway, subject to the provision of the Habitats Directive and other legislation, and the Felixstowe Trinity proposal offered the greatest degree of fit with national and regional policy objectives and the guiding strategy principles of their report. The consultants felt that development plans should still safeguard land at all the above locations.

4.9 For ro-ro, the consultants considered that expansion of operations at Dover, the Channel Tunnel (subject to a detailed transport assessment of the land side implications) and at Shellhaven would more than meet required capacity by 2016.

4.10 Based on the above strategy the consultants considered the future prospects for each port, including Southampton and Portsmouth.

4.11 Southampton's role as one of the larger ports in the study area was recognised. The report notes the proposal for Dibden Bay which could accommodate the projected shortfall of container terminal capacity. The environmental implications of the proposal are recognised as is the need to improve the A326. It is also noted that the ability of Dibden Bay development to help tackle regeneration need in Southampton is not straightforward. The consultants consider that if approval is given to Dibden Bay, Southampton's role would grow further but whatever the decision it could have a significant impact on other container terminal developments in the study area.

4.12 Portsmouth is identified as a successful and growing port that has invested heavily in ro-ro facilities and transport links in recent years. The consultants consider that Portsmouth can continue to attract a greater share of the cross-channel market but is likely to only play a secondary role in meeting forecast demand increases for ro-ro facilities in the future.

4.13 A strong message to emerge from the report is that rail access to ports is a matter that requires urgent attention. As well as new links to ports not served by rail there is a pressing need to upgrade rail links to existing ports. Enhanced capacity and loading gauge between Southampton and the West Midlands is identified as well as tackling the rail freight pinch-point at Reading as a matter of urgency. A new rail link at Portsmouth is also considered.

4.14 The consultants identified that most of the principal road pinch-points that affect port access already have planned improvement schemes or were subject to consideration in a multi-modal study. Specific schemes identified included road improvements to the proposed road-rail-sea interchange at Portsmouth and capacity improvements on the A326 (if Dibden Bay is approved).

5. SEERA's Draft Policies on Seaports

5.1 SEERA is currently considering the various issues raised in the regional ports study. A possible policy framework will emerge shortly and an oral update will be made at the meeting.

6. Comments of the County Planning Officer

6.1 The regional port study provides a technical piece of work that SEERA is utilising in the development of detailed policies on ports within the RTS. The key matter is the likely proposed regional policies rather than the publication of an overarching study on ports in the South and East of England.

6.2 A great deal of discussion has taken place at the Dibden Terminal Inquiry about the relationship between aspects of the ports policy outlined in Modern Ports: A UK Policy and obligations to consider alternatives contained in, for example, the Habitats Directive and Regulations and policy guidance governing National Parks in PPG7. These obligations, as well as other policy considerations concerning alternatives and the relationship between need and environmental harm, have to be addressed in the formulation of regional policy. Overall national policy does not provide the regional planning bodies with a clear and unambiguous framework to assist them to produce effective policies. Modern Ports: A UK Policy does not identify where expansion should be authorised and therefore does not provide any locational guidance to assist the decision takers. It does not put forward criteria to help determine new projects. It does not grapple with the unavoidable fact that the case in favour of one particular development is necessarily affected by the prospects of other developments receiving consent.

6.3 Current regional planning guidance does not give any locational guidance for port expansion sites. PPG11 indicates that whilst regional planning guidance should avoid identifying specific sites there may be some exceptional types of development where precise location is of greater than local interest. Inclusion of specific sites would be without prejudice to later formal consideration at the development plan and project application stages. At least the proposed policies by SEERA will start to address this difficult issue. There is a substantial need for plan-led regional guidance on ports.

6.4 Representatives of the port industry have questioned the forecasts used in the regional ports study with some operators considering that the estimates are seriously flawed. The County Council's consultants on need for the Dibden Terminal Inquiry have produced their own estimates of future container capacity which are higher than those in the study. The County Council's consultants have major concerns with regard to the forecasting techniques used earlier in the regional study. There are difficulties identified with regard to the projection of container demand, the treatment of transhipment and empty containers, the handling of differentiation of demand by ship size category, and, the quantification of capacity. The final report of the study has a higher case set of estimates which are closer to the County Council's consultants container forecasts but difficulties still remain with the approach, and there could be an underestimation of the need for new deep sea container capacity.

6.5 Forecasting is never an exact science and there is a divergence of view on how much additional capacity is needed and by when. However, the actual requirement for new port container handling facilities will be dependent upon the pace of demand development and also the level of capacity improvements and expansions that are actually implemented. The critical issue for present purposes is that a shortfall in container and ro-ro capacity has been identified and that a strategy is required to respond to this situation.

6.6 The regional ports study guiding strategy principles represent key factors in formulating any suitable policies. However no guidance is given on the relative importance of the individual factors and how conflict between principles could be resolved. For example, the study identifies the principles of making best use of existing facilities, and environmental protection. Neither the study nor Modern Ports: A UK Policy give any guidance as to how rigorously the objective of increased efficiency at existing facilities should be pursued to assist in any decision on the dichotomy between "expensive" infrastructure investment on existing port land and "cheaper" expansion on new port land which may have a severe environmental impact.

6.7 With regard to container facilities the regional ports study examined the most suitable locations for new additional development. This was based on an appraisal of the main proposals or sites for container terminals that are currently being promoted. Some scores in the appraisal could be questioned. It has to be recognised that this is a very difficult exercise and will inevitably involve a comparison made on the basis of differing degrees of availability of information. However some appraisal is required to prioritise locations for new development in order to avoid unnecessary over capacity and damage to the environment. The regional ports study notes that the London Gateway development would provide sufficient capacity to accommodate container sector growth to beyond 2016. It is clear though that the study's forecasts are not supported by some operators in the ports industry including ABP, and the County Council's own consultants have concerns on the approach. The consultants' view in the regional port study is though that the balance of the beneficial and adverse impacts suggests that the development proposed at Shellhaven at the Port of London provides the greatest fit with the study's guiding strategy principles, and the current planning framework.

6.8 Modern Ports: A UK Policy envisages that RTS will offer guidance on the role and future of ports in the region. The regional ports study analysis of the future prospects for Southampton and Portsmouth will obviously assist SEERA in fulfilling this requirement. However a clearer set of roles would be beneficial. The potential contribution of the existing docks area in Southampton to meeting future trade, needs to be recognised. Similarly, Portsmouth's potential contribution to ro-ro needs should not be underestimated.

6.9 Modern Ports: A UK Policy also identified the requirement to integrate ports' needs with landside transport infrastructure. It is unclear in the regional ports study how far port traffic fits with the likely capacity of the road and rail networks. The need for improved rail freight capacity to handle potential expansion from the existing ports of Southampton and Portsmouth is not separately identified. SEERA will need to consider the priorities for developing the road and rail links to ports as part of the final version of the RTS.

6.10 The regional ports study has not extensively examined the issue of marine access to the ports in the study area. The need to provide a commercially acceptable tidal window for larger ships that may be used, especially for the container trade, may either constrain potential development or require additional mitigation for possible environmental impact. This important part of the supply chain should not be omitted from the considerations.

6.11 SEERA is currently preparing ports policies for inclusion in the RTS, based on the regional ports study and other contributions. The County Council should therefore forward to SEERA its view on the most suitable approach to this policy formulation.

6.12 There is a need to provide a regional planning framework for ports as this would facilitate an appropriate means of striking a balance between meeting the needs for port expansion and avoiding unnecessary environmental harm. The main pressure area in land use terms is the need for facilities for deep sea containers. The framework could usefully encapsulate the philosophy of a sequential approach to decision making - a principle that is well established in land use planning.

6.13 A sequential approach could be based on the following hierarchy:

(i) Firstly, maximum use should be made of existing port operations before supporting new expansion developments. This aim is a cornerstone of national ports policy. It would require SEERA to come to a view on the extent that increased productivity, new infrastructure and commercial decisions on port operations could reasonably be achieved within existing ports in order to assess the residual need for new expansion. This could include a view of the likely support for an increase in short sea shipping.

(ii) For decisions on new expansion, the starting point should be the core strategy of existing regional planning guidance and other aspects of the relevant development plans. The priorities given to regeneration in RPG9 is that national priority is given to the regeneration of Thames Gateway followed by the regional priorities to regeneration areas. Any decisions on new expansion sites should take into account the current development plan policies for these locations. It is essential that such an approach includes an appropriate consideration of alternatives.

(iii) The next consideration is the characteristics of any potential expansion sites. Again, reflecting national policy guidance, brownfield sites should be utilised first, provided that there are no severe environmental effects. Greenfield sites should be used as a last resort. These considerations also need to take into account any implications for marine access and any changes to this that might arise.

(iv) Underpinning all these considerations is the need for any new development to be sustainable. It would need to be demonstrated that for any fundamental environmental disbenefits that suitable mitigation could be achieved. Balancing the environmental impact as well as the social and economic implications with the benefits of any proposal has to be a hallmark of any decision.

(v) Lastly, any decision on new port expansion would have to show that it could be integrated with the necessary land infrastructure requirements. Any decision on new port sites would have to examine the impact of the development on existing road and rail capacity, and the ability to achieve any necessary improvements.

6.14 Such an approach will require the consideration of many factors and a judgment whether sufficient appraisal has been undertaken in order to formulate positive policies. It is possible that what may emerge from the application of such an approach described above is that for deep sea containers, priority would be given to expansion to within the existing utilised ports of Southampton and Felixstowe, but it is likely that the priority for new site expansion would go to a brownfield site within Thames Gateway, ie Shellhaven. The need for further allocations would be dependent on the extent of need not met by the Shellhaven development. Under this process it would be appropriate, until all the necessary appraisal and decisions have been taken, for development plans to continue to safeguard all the known potential expansion sites.

6.15 In conclusion, devising policies for ports as part of an RTS is a major challenge for SEERA. The regional ports study that has been produced is a contribution to that task. The County Council has in this report put forward to SEERA comments on the regional ports study and indicated a possible framework for formulating regional port policies especially in relation to deep sea container facilities. It will be necessary for the County Council to undertake further consideration of the situation as the proposed port policies emerge from SEERA for inclusion in the RTS.

Recommendations

That the Executive Member for Environment be advised that

1. The South East England Regional Assembly be:

(i) informed that the County Council considers that the Regional Ports Study is a useful contribution to the preparation of port policies;

(ii) informed that the County Council considers that any future ports strategy should have an aim to include an appropriate examination of alternatives;

(iii) informed that the County Council considers that a suitable approach to the formulation of port policies for deep sea container facilities should be based on a sequential approach which involves:

(a) making maximum use of existing utilised port land;

(b) for new expansion sites, taking a wide consideration of alternatives, utilises the core strategy of Regional Planning Guidance Note 9 to determine priorities, and takes into account current development plans;

(c) utilises brownfield sites in preference to greenfield sites if this would result in less environmental damage;

(d) ensures that all new development is sustainable with any fundamental environmental effects having a suitable, achievable mitigation package;

(e) ensuring that any new expansion site can be integrated and accommodated with the road and rail network;

(iv) informed of the detailed comments in section 6 of this report on the regional ports study and the preparation of ports policies for the Regional Transport Strategy.

2. The County Council would welcome further dialogue with the South East England Regional Assembly as port policies emerge for the Regional Transport Strategy.

3. Officers, in consultation with the Executive Member for Environment as necessary, be authorised to make further representations to the South East England Regional Assembly on the regional ports study and port policies, as required.

7414/TC