The spring on the relief valve sits in a socket in the lowest point of the fuel system of the D311 engine. As such it sits in whatever water collects in that socket and will frequently be found to have rusted through. Even if spring is OK, the little poppet of the relief valve may be hardened or have trash caught in it so the pump cannot build pressure.
So, look at the fuel line coming into the bottom of the fuel filter tower at left front of the engine. You will see that it attached to a small cast iron piece held on by two 3/8" bolts. Remove these bolts and perhaps one fuel line support clip and you can tap this piece loose from the bottom of the filter housing and it will drop down enough to inspect the bypass valve poppet and spring. Spring goes in hole in cast piece and poppet sits on top of spring with sealing surface facing up to seal against the base of filter housing casting. Sometimes that surface is pitted or eroded and the poppet cannot seal. This can be fixed by carefully filing it back flat and reinstalling the fuel line adapter block with a new gasket.
Unfortunately some of the transfer pumps on these old engines have pumped enough hard grit over the years that the wear is bad enough to prevent it building proper pressure. If yours is still good, might want to install a filter in-line ahead of it to prevent any damage. Some are worn enough that they won't read any pressure until the diesel fires up, but once it starts, they do OK as long as the filters are not plugged up.
My D311 set up for dual fuel runs about 24psig on the diesel transfer pump and about 28 on the diesel transfer pump. It is capable of something over 19 kW on either. It doesn't take a lot of pressure. Are you sure the gauge isn't stuck?
Dogger, I forgot to ask - did you flip the lever to run and try to start the main engine. I'm sure you did, but your post didn't say. Try that anyway because as Jack asked, the gauge might be faulty. Also, if you do try to start it, give the main governor lever a good hard yank to the rear. I've heard folks say that sometimes it doesn't start because the operator didn't actually open the governor. I'm sure you also know this but the "Start" and "Run" positions really mean valves held open (therefore no/little compression, certainly not enough for the main engine to run) and valves not held open (i.e. the valves open and close as normal, and thus the engine is able to run).
Anyway, check out your relief valve. It's quick and easy to do and might eliminate one more issue. If your spring is no good, you can temporarily substitute a similar size/rate from the hardware store until you get a new one. It doesn't need to hold much pressure