Supplementary guidance - Freight Facilities Grant (FFG) funding

New rule applying to FFG support for intermodal terminals in certain areas

FFG funding will no longer be made available for investment in intermodal terminals in the North West of England (i.e. the Manchester, Liverpool, Widnes conurbations).

The Government aims to reduce road congestion and carbon dioxide emissions and improve road safety and air quality by securing the removal of lorry journeys from the UK road network through its freight grant (mode shift) schemes. The grant schemes help to fund the difference in cost between rail/water and road freight, but only where the environmental benefits can justify the support, there is a genuine financial need for grant and the provision of grant would not distort competition. 

The decision not to provide Freight Facilities Grant (FFG) funding for intermodal terminals in the North West reflects the increasing competitiveness of the sector in this market which is good news for the intermodal sector.

Competition in the rail freight intermodal business is increasing with a number of terminal and freight hauliers now active in the market. In the North West market in particular, there are at least three separately owned competing terminals and rail hauliers serving the market.    

In addition to this, there are plans to develop two new rail freight terminals at the Port of Salford and at Parkside both of which will be developed without public sector support.

The Department will therefore no longer provide FFG support towards terminal investment in the North West as it will clearly distort the market between those who have received grant support and those which have proceeded to invest without.

Similar competition issues are likely to prevail in markets other than the North West of England. The Department therefore reserves the right to extend the policy not to provide FFG funding to intermodal terminals in other areas as and when detailed research has been undertaken in these markets.