May I first say how pleased I am to have this opportunity to explain to the House, and to my hon. Friend the Under-Secretary of State, proposals for a European rail freight route stretching from Glasgow to the channel tunnel? I should say from the outset that I have no pecuniary interest in rail freight developments, but I am passionately committed to the proposal for a rail freight route down the backbone of Britain—a new railway line that is vital for Britain’s future transport infrastructure needs and economic success.

This is not the first time that I have spoken up for rail freight, having secured an Adjournment debate some eight years ago, when I expressed support for the then Central Railway scheme, which was similar in many ways to our Eurorail freight route, but a more limited scheme on a somewhat different route was then proposed. After 1997, I put proposals informally to successive Transport Ministers—at an earlier stage for variations of the Central Railway proposal, and in more recent years for the Eurorail freight route scheme.

The Eurorail freight route proposals have been developed by a small and strongly committed team, including railway engineers, a major road haulier, a railway consultant and me. My hon. Friend will know that two weeks ago we met officials in his Department and had a most useful and constructive discussion, which we hope was helpful in explaining our scheme in detail.

We have consulted widely and are continuing to do so, seeking to make sure that our scheme is absolutely right in every respect. We have spoken with the Institution of Civil Engineers, the Freight Transport Association, the Rail Freight Group and many others. I wrote to Sir Rod Eddington during his recent study for the Treasury, receiving a friendly reply, and have kept Network Rail informed of our proposals. We also made a submission to our noble colleagues in another place in 2005.

We continue to have cordial relations with Central Railway and regularly meet its representatives. We are, however, different in concept: Central Railway is a company with business objectives, whereas our own Eurorail freight route group is concerned simply to persuade the Government of the value of our scheme and to consider making a positive reference to it in the White Paper due later this year.

I shall now turn to the details of our scheme and say why we think it is so vital to Britain’s future. Most significantly, we have specified a very precise track route and given detailed consideration to its construction and necessary works. We have presented to my hon. Friend’s departmental officials maps showing the exact route that we propose.

The crucial feature of our scheme, however, is to construct it to a large gauge sufficient to transport full-scale road trailers on trains and full-sized 9 ft 6 in containers. Indeed, we go further and propose that the core route would eventually be capable of transporting double-stacked 9 ft 6 in freight containers. The scheme would offer access to road hauliers at terminals close to motorways and the major economic regions of Britain. Freight operators could simply deliver their road trailers to the nearest terminals for onward transportation by rail and collection for delivery to their final destination by road at the other end.

It being Ten o'clock, the motion for the Adjournment of the House lapsed, without Question put.

Motion made, and Question proposed, That this House do now adjourn.—[Tony Cunningham.]

The concept has been described as a rolling motorway, and that is what it would be—and an international motorway too. It would take more than 5 million lorry journeys off our roads every year as well as providing a dedicated rail freight route for much of the north-south rail freight traffic currently using the east coast and west coast main lines. Our route would not only take large volumes of freight traffic off Britain’s roads, but would free up the east coast and west coast main lines for faster and more frequent passenger use.

As a spin-off from our scheme, we also suggest that the east coast main line in particular could and should be upgraded, with the quadrupling of the track at Welwyn and a new viaduct, as well as other improvements further north to permit 140 mph non-stop passenger trains from London to Edinburgh. Similar services to 135 mph could be made possible on the west coast main line to Glasgow, provided that much of the north-south freight traffic is transferred to the new freight line. The Eurorail freight route would, we suggest, be an integral part of Network Rail’s future network.

As for the construction of our route, its main attraction is that it would be built on existing corridors—either underutilised existing lines or old track bed—for all but 14 miles of its 470-mile length. Indeed, only 4 miles of new track across open farmland would be required, the other new track being in tunnels. The terminals would also be constructed either at existing sites or on new sites well away from human habitation, thus minimising any negative environmental impact. The construction would therefore be simple and easy, minimising both planning constraints and also, crucially, the cost.

I shall now describe the precise route. We propose that the scheme be built in phases, starting at the north Thames with a terminal linked to the channel tunnel rail link so that lorries-on-trains services, as well as container traffic to and from the continent of Europe, could begin very soon. The next phase would be a link round the east and north of London to a second terminal close to the M40, M25 and M4 motorways, and with easy access to the M1 and M3. That route would make use of the Barking to Gospel Oak line and then a new tunnel under Hampstead linking to the Midland freight lines at West Hampstead.

The line would then pass through Cricklewood and on to the Chiltern lines, which would involve reinstating track in vacant track bed. Travelling northwards, the line would then make use of the old Great Central route, again with track reinstatement on old track bed. Further terminals would be located in the east midlands and the west midlands with a link through to Birmingham, and the main route would then travel northwards almost entirely on existing routes to Sheffield and the Tinsley terminal, before crossing the Pennines through the unused Woodhead tunnel to another terminal near motorways in south Lancashire. The route would then track northwards through Lancashire, linking up with the Settle to Carlisle route and so on to Scotland and Glasgow. A link would be built to Newcastle and the north-east, and the Birmingham link could later be extended to the south-west and south Wales. Another possible link could be developed between our north-west London terminal and Southampton.

Although in the first instance the route would make use of channel tunnel rail link track from the north Thames Gateway, we propose that a new Thames crossing be built linking our route to the Medway valley line and so to the channel tunnel, again making use of existing track routes. My hon. Friend will be aware—as we all are—of the ongoing financial crises of the channel tunnel. These derive essentially from the fact that the channel tunnel is under-used and the existing traffic is incapable of providing a return on the historic capital cost of the tunnel’s construction. There are tens of thousands of vacant train paths through the tunnel every year and there will never be enough passengers to take up even a tiny fraction of these. Our scheme would deliver those tens of thousands of trains—freight trains—to the channel tunnel every year, transforming the tunnel’s economics and making it financially viable for the future. The reality is that the tunnel is effectively subsidised by the French and British Governments and we contend that our scheme would simply obviate the need for future subsidies.

Other major savings would be in road repairs and congestion on Britain’s motorways. My hon. Friend will know that these have been estimated as costing billions every year—much of that burdening the Exchequer, with other costs falling more generally on the economy as a whole. He may also be aware of the fact that it is lorry traffic that causes road damage. Road damage is linked to axle weight by the so-called fourth power law, whereby the damage caused is proportional to the fourth power of any increase in axle weight. Lorry axle weights are several times those of passenger cars and are the primary cause of road damage and the need for expensive repairs, coned-off lanes and the inevitable consequent congestion. Five million fewer lorry journeys would significantly reduce the need for road repairs and the concomitant Exchequer costs.

The Eurorail freight route scheme would promote a significant modal shift of freight from road to rail, free up existing main lines for faster passenger services and provide a much-needed new freight transport artery linking Britain to the major European economies for the future. A massive new network of dedicated rail freight routes is being constructed on the continent of Europe, and Britain must be linked to that network if we are not to suffer from economic peripherality and relative economic decline in the longer term.

It was our noble Friend Lord Kinnock, in his role as European Transport Commissioner, who promoted the concept of a European rail freight network, and our European neighbours are racing ahead in developing such a network. A major rail tunnel is being built through the Alps to Italy and a 35-mile rail tunnel is being built under the Brenner pass to link Italy to Austria and Germany. Both have flat gradients, which enables them to take large-gauge, heavy and long freight trains. Britain must not be left behind by those European developments.

We all welcome, of course, the significant increase in rail freight in recent years, but it has to be said that that is simply keeping pace with the overall growth of freight traffic. Rail freight is also constrained by the existing rail network, which is both short of capacity and incapable of taking full-scale road trailers on trains. Worryingly, even in the past fortnight, we have seen a further 45 per cent. drop in the amount of freight going through the channel tunnel as a result of services being withdrawn by Unilog, which has ceased trading. All those problems could, and should, be overcome by constructing new dedicated rail freight infrastructure, and our Eurorail freight route scheme, we believe, is the way forward. The Department for Transport’s figures show that rail freight produces one twelfth of the carbon emissions of comparable road freight, so our scheme would contribute substantially to reducing those emissions.

Finally, and perhaps most crucially of all, the Eurorail freight route, as we propose it, would be very inexpensive to build. We have recently recosted our scheme using comparisons with existing railway construction costs elsewhere in the UK. Our scheme would cost only about £3.5 billion—a fraction of the costs of the channel tunnel rail link, Crossrail and the west coast main line modernisation. Our costs would be low because we would make use of existing corridors and terminal sites whenever possible and minimise new and difficult construction.

I hope that my hon. Friend will give serious thought to our scheme when he is preparing his upcoming White Paper. We believe that it would be immensely advantageous to the logistics industry, enormously beneficial to the wider economy and very popular indeed with the electorate throughout the whole of Britain. I commend our scheme to him for his careful consideration.

I congratulate my hon. Friend the Member for Luton, North (Kelvin Hopkins) on securing the debate—for the second time in a short number of weeks, I believe—and giving the House an opportunity to discuss this important matter. Shortly after I was appointed to my post, I attended a business breakfast for the British rail freight industry. The only familiar face at the table that morning was that of my hon. Friend—it was good to see him there. Since then, I have become well aware that his interest in, and commitment to, the British freight industry is extremely impressive. He is very knowledgeable about the matter and I am always grateful for any advice that he can offer me. In this short debate, I hope that we will be able to make some progress on the scheme that he has proposed. I will start by making several general policy comments before going on to the specifics of my hon. Friend’s project.

My hon. Friend mentioned the Eddington review of the long-term impact of transport decisions on the UK’s productivity, stability and growth. The review highlighted the role of freight and the fact that reliable freight journeys are key to enabling the economy to function effectively as an increasing volume of imports supports the shift towards a service economy. As prosperity and the demand for goods grow, efficient freight transport is increasingly vital to the UK economy. Rail freight is a competitive private sector industry. Since privatisation in 1995, the amount of freight moved has increased by 66 per cent., measured in tonne kilometres. Rail freight’s market share also increased over the same period from 8.5 per cent. to 11.7 per cent.

The Government welcome such growth and want it to continue. Our rail freight policy statement to Parliament in July 2005 outlined our clear policy aim of goods being moved in a sustainable way that maximises benefits to the economy and society. For instance, because rail and water freight generally have less impact on society than road transport, they can bring about substantial benefits. In 2005-06, the rail freight industry moved the equivalent of 1.22 billion lorry kilometres, which saved 6.74 million lorry journeys and delivering significant reductions in pollution and congestion. We believe that rail therefore has a crucial role to play in goods transport alongside other modes, and we want to see freight travelling by rail instead of road wherever that makes the most sense.

We recognise that, compared to road freight, rail and water freight can reduce accidents and congestion on our roads, and can cut pollution and carbon emissions. To support the moving of freight traffic by rail and water instead of by road we operate two grant schemes that are administered through the sustainable distribution fund. I hope that the House will bear with me as I go into the detail of those.

The two schemes are the freight facility grants scheme and the rail environmental benefit procurement scheme, known as REPS. REPS starts in April this year and replaces and builds upon the successful track access grants and company-neutral revenue support schemes that have been in place for some years—but I expect that you knew that, Mr. Speaker. To support the rail freight market we have announced that a resource budget of £18.5 million a year has been allocated for the sustainable distribution fund until 2009-10. That is designed to give industry certainty that the grants will be available for the duration of their normal contracts with customers.

I am pleased to see how the rail freight industry has worked together to formulate the forecasts that have been used in the freight route utilisation strategy, or FRUS, and Network Rail's other route utilisation strategies, as well as other parts of the rail industry planning process including, of course, the high-level output specification. Those forecasts cover the period until 2015 and indicate that rail freight growth will both continue and be concentrated on specific sectors, such as the electricity supply industry coal, and deep sea, or intercontinental, intermodal traffic to and from the UK's deep sea ports and in the construction market.

In the next few years, the Government will complete a number of major projects aimed at enhancing the capacity and capability on the current network. They include the west coast project, where enhancements such as the Trent valley four-tracking scheme will increase capacity for passenger and freight services, and additional capability is being provided to accommodate further growth. That is just one of several schemes being taken forward by the Government and the industry to improve capacity. Despite record levels of investment, however, we recognise that capacity in some areas remains an issue. That is where the aims of the project that my hon. Friend has described come in.

The promoters of the Eurorail freight route discussed their proposals with officials when they met earlier in this month, as my hon. Friend mentioned. Clearly the promoters have carried out a considerable amount of work to identify a possible route and to develop some outline construction costs for the scheme, and I pay tribute to my hon. Friend for the amount of work that he has put into the promotion of the scheme. That said, however, the project is clearly a large one that is at a comparatively early stage of development, and we would wish to understand the operational effects of the scheme on the wider rail network, the financial viability of the proposals and the potential environmental effects of such a scheme before making a decision on whether to support it.

The type of proposal being promoted by the Eurorail team is designed to provide long-term capacity for rail freight. We remain convinced that, in the short term, significant benefits can be gained through making maximum use of the capacity that is already available within the existing railway network. Network Rail is developing a series of route utilisation strategies, which will help to achieve this objective. The strategies aim to ensure that capacity is used as efficiently as possible and that demand and supply are as closely matched as they can be, while ensuring better performance and reliability.

The RUS process also highlights areas where small-scale investments will enhance capacity and capability, some of which may be funded by the Network Rail discretionary fund, and some of which may be incorporated into the high-level output specification. Although the majority of the RUSs cover both passenger and freight in specific geographical areas, the specific network-wide needs of freight have also been recognised in the work undertaken for the freight RUS, the final version of which Network Rail plans to publish in March this year following consultation on the draft.

Each Network Rail route utilisation strategy covers a period of approximately 10 years. For the longer term, the Government continue to advance a number of projects to enhance capacity, including the Thameslink project for which we have recently received planning permission and allocated £30 million for further development of the project in advance of the outcome of this year's comprehensive spending review.

This year, our strategy and high-level output specification programme will set out our long-term expectations for the whole industry. In the HLOS, which is our first such document, the Government will specify clearly what they expect from the railway during the next control period. However, we will not specify outputs for the freight industry, as the Government are not a customer of the private freight industry. One of the main considerations for HLOS will be the capacity of the network, and how to respond to the likely increases in demand. Although the specification will, of course, have a passenger focus, it will also draw on the work done by the industry in the freight route utilisation strategy directly to inform our demand models. That will allow us to plan for passenger growth while keeping an informed eye on the needs of freight.

Given that railway projects can take a number of years to come to fruition, the Department will also consider the strategic direction for the railways over a longer period, so that while shaping the first HLOS, we are aware of the likely pressures and requirements for subsequent years. That will ensure that we do not carry out abortive works, and that when renewals occur, they have been designed with the likely longer-term requirements in mind. That will save us time and money when schemes are implemented in later years.

To conclude, we welcome rail freight growth and we want it to continue, but we recognise that capacity remains an issue in some areas, and projects of the type proposed by the Eurorail promoters and by my hon. Friend may increase that capacity. We are happy to consider such proposals as and when they are submitted through the planning process. In the meantime, we will continue to develop projects that will enhance capacity for both passengers and freight.

Question put and agreed to.

Adjourned accordingly at sixteen minutes past Ten o’clock.