Marine Navigation Aids Bill [HL]

Baroness Garden of Frognal Excerpts

Friday 21st January 2011 Lords Chamber

[The Earl of Caithness]

The noble Lord mentioned making amendments. Will he tell us in precise detail what parts of the Bill he proposes to remove?

[Baroness Garden of Frognal]

My Lords, the noble Lord is entitled to make his Second Reading speech without interruption at this stage of the debate.

[Lord Berkeley]

I am grateful to noble Lords. I was about to come to what I intend to remove, which will be a significant part of the Bill. I will replace it with what I would call an output specification, which, as I said a moment ago, would be a clause that would require the Government to reduce light dues, to codify reduction targets by probably 50 per cent over five years and to cease providing the Irish subsidy.

I was proposing to leave in the clause on pensions, because that came from the draft Marine Navigation Bill, for which the previous Government did not get round to finding parliamentary time. I wrote to the Shipping Minister asking whether he thought that it was a good idea to leave it in or whether he wanted anything else to be put in. As the noble Lord will know, there is already a Commons Private Member’s Bill, promoted by Therese Coffey, on wreck removal. So it is for me to have further discussions with the Minister, and a substantial reduction in the Bill’s scope will be proposed. However, I have checked with the Clerks and they seem happy with that. I have also been advised that in Private Members’ Bills in your Lordships’ House we can propose reductions in charges, costs or anything else, but we are not allowed to propose increases. That is the advice that I have had from the Clerks. Again, however, we can debate that.

All organisations that are under pressure will say that they have squeezed their efficiencies as far as they can and that they cannot do any more without compromising safety. However, we have seen in many areas that, when push comes to shove, they can do it. I believe that a bit more pushing on the GLAs will enable them to reduce costs. They will have to reduce costs and it will not compromise safety.

I welcome the Government’s action in particular in respect of the Irish question. However, I think that it would be useful for the Government to have some legal support in the shape of this Bill in case the Irish want to change their mind at any time. I have talked to many people in the shipping industry, as I said, who have confirmed the view that Mr Davidson has suggested—that reducing the costs of the GLAs by 50 per cent is reasonable and achievable and that, if the costs come down, the charges will come down. I very much look forward to noble Lords’ comments and, no doubt, if the Bill is given a Second Reading, to further discussions. I beg to move.

--- Later in debate ---

[Lord Prescott]

My Lords, I start with an apology; I did not realise that the Bill of the noble Lord, Lord Berkeley, was before the House until I came in, switched on my television and heard him speaking. I declare an interest having spent 10 years as a merchant seaman and having been a Minister for merchant shipping in the previous Government.

Having heard the argument’s today, I should say that ship owners have always been concerned about cutting costs. But we are talking here about a very small part of their operating cost. Whether right or wrong, whether it should be paid by the taxpayer or the user, it has been subject to the user principle. As the Minister for shipping, I constantly had to deal with the problem that the noble Earl, Lord Caithness, raised, of how to deal with the Irish and how to get a proper agreement between us. I am pleased to hear that agreement apparently has been reached. The Bill proposed by the noble Lord, Lord Berkeley, is trying to bring greater efficiency and effectiveness into this operation and the payment of navigational aids. I am not too sure whether that is the right approach, but there is certainly a problem.

I want to address my remarks to whether the user cost, mentioned by the noble Baroness, Lady Scott, is a disincentive to British shipping. The facts are clear: more tonnage is coming into Britain by ship than ever before. We are roaring in trade. That is true not only in Britain but in most countries; it is the nature of the global economy. So I do not think that they have been put off by the cost in those circumstances. I have been concerned about the cost of the crews, however, to which the noble Lord, Lord MacKenzie, referred. Over the past few decades, the reduction of crews on ships has led to a reduction in navigational skills and the loss of ships. Crews have been reduced by more than 25 per cent. That is a real saving—there is no doubt about it. Most of our shipping was flagged out to what we call the flag-of-convenience countries, such as Liberia and Panama, which sold their flag. The ship owners, many of them British, were very happy to take advantage, because it was a reduction in costs. It was also a reduction in skills and navigational abilities. Having achieved that real advantage, they now talk about the costs of navigational aids.

I should point out to the noble Baroness, Lady Scott, that what happened to containers happened years ago. A decision was made on whether Britain was going to be the area for container centralisation and distribution to Europe. We lost it. The tidal advantages to Rotterdam and other places gave them an advantage. Therefore, there was a great deal of redistribution from Rotterdam and to the British ports. Nevertheless, the container trade has been considerable; there has been massive growth, even in the UK.

I shall return to the point about user tax. Is this a disincentive to the British industry? Does it wish to reduce its costs and have an advantage? Of course it does—I understand that—but should they be paid by the taxpayer or met in user payments? When I was Minister for shipping, I was faced with a decline, as the noble Earl, Lord Caithness, must know. The British navy as registered under the Red Ensign was 30 million tonnes in 1970; when I came in in 1997, it was down to 2 million tonnes, and it had flagged out to other countries. I introduced the tonnage tax, which was a user payment and a means by which the ship owner could have greater control over his costs and profits by paying a known tonnage tax rather than a profit tax, which might be changed by various Governments. By using the tonnage tax we had a transfer back to the British fleet, and from 2 million tonnes in 1997, we now have 17 million tonnes under the Red Ensign. I am delighted about that, although I do not think enough jobs came out of it.

[Baroness Garden of Frognal]

I remind the noble Lord that speakers in the gap should restrict their comments to four minutes and he is now in his fifth minute.

[Lord Prescott]

I bow to the noble Baroness’s knowledge, and I am sorry about that. I shall finish on this one point. User tax did not discourage the fleet—it actually encouraged it. So I am not convinced that the small amount of tax that we are talking about would be a disincentive to the British ship owner.