HC Deb 14 April 1981 vol 3 cc231-8

8.—(1) After section 27 there is inserted— "Combined charges

27A.—(1) Where a harbour authority have power, whether by virtue of section 26 of this Act or any other statutory provision—

  1. (a) to levy ship, passenger and goods dues or equivalent dues; and
  2. (b) to make other charges, the authority may, subject to the next following subsection, make a combined charge, that is to say, a single charge referable in part to matters for which ship, passenger and goods dues or equivalent dues may be levied and in part to matters for which other charges may be made.

(2) A harbour authority may not make a combined charge in any case where—

  1. (a) the person who would be liable to pay the charge objects to paying a combined charge; or
  2. (b) a number of persons would be jointly and severally liable to pay the charge and any of them objects to paying a combined charge;
but without prejudice to the power of the authority to make separate charges in such a case.

(3) A person may not object under subsection (2) above to the payment of a combined charge in pursuance of a prior agreement between that person and the harbour authority.

(4) In this section—

(2) In section 30 (duties with respect to keeping of lists of charges, etc.) after subsection (4) there is inserted—

"(5) Subsection (1) of this section does not apply to combined charges within the meaning of section 27A of this Act.

(6) References in this section to the dues of charges exigible by an authority or Board are references to the amount exigible where no composition agreement applies and no specially agreed rebate is allowed.

(3) In section 31 (right of objection to ship, passenger and goods dues), at the end of subsection (1) (charges to which the section applies) there is inserted "other than combined charges within the meaning of section 27A of this Act; and references in this section to the rate at which any such charge is imposed are to the amount where no composition agreement applies and no specially agreed rebate is allowed".'.

This amendment was foreshadowed in our Committee debates. It has been brought forward by the Government to clarify the position when port users wish to appeal against their ship, passenger and goods dues in ports. It arises as a result of representations which have been made to the Government and which were made to all members of the Committee on behalf of waterways users and others who are very concerned about the appeal rights that exist in the case of ship, passenger and goods dues. Some of them wish to see appeal rights extended to cover cargo handling charges also. They were able to impress us to the extent that we accepted that there was confusion and doubt in present practice. This is a useful occasion on which to clarify matters.

A list of ship, passenger and goods dues has to be drawn up and under section 30 of the Harbours Act 1964 the harbour authority has to make those dues available for inspection. Section 31 of the 1964 Act also gives a right of appeal against those dues to the National Ports Council. That right of appeal has been retained, but under the terms of the Bill the appeal is transferred to the Secretary of State.

I listened to the case put forward for extending the appeal rights to cargo handling charges generally. It certainly is the case that the practice has changed since 1964. Since that time the port authorities have themselves become major employers of stevedores. They have acquired quite a lot of warehousing facilities also, and with the growth of containerisation and with technical change in the industry the practice has arisen of port users having to look to the port owner for cargo handling charges as well as the traditional dues. The practice has also arisen of ports making combined charges to their users, which comprise not only the goods, passenger and ship dues on the one hand but cargo handling on the other.

We resisted the idea of extending the powers of appeal to cover cargo handling, largely because it would be inconsistent with the policy of the Bill. The policy of the Bill, as has been underlined on another feature by my right hon. Friend the Secretary of State, is that the Government believe that there is a limit to the extent of useful Government involvement in the day-to-day affairs of the ports. Certainly, we do not wish to see the Government involved in the commercial side of the ports business and in any way fixing cargo handling charges or anything of that kind.

We also feel that if a right of appeal were granted to users against the cargo handling charges imposed by port authorities, it would give rise to an anomaly, because no right of appeal is contemplated concerning the cargo handling charges made by private stevedoring companies. Therefore, we were not very happy about a situation in which we would be giving a right of appeal against the cargo handling charges by the statutory bodies but no similar right of appeal against the private bodies.

We were also concerned that if we gave a general right of appeal it would be possible for major users of ports, in theory at least, to enter into commercial agreements for the charges that they were paying and then to seek to reopen them afterwards by exercising a statutory right of appeal and trying to get the bargain adjusted in their favour by going to the Secretary of State.

I am trying to condense an argument which we had in Committee. We went over it, and I hope we satisfied the Committee that the Government did not feel it right to extend the existing appeal provisions. On the other hand, we are quite content to leave such appeal provisions as there are extant and to transfer from the National Ports Council to the Secretary of State the duties of hearing the appeals.

The question then arose of the combined charges and the way in which some people felt that the rights of appeal against the dues were being frustrated when combined charges were levied, because it was impossible to disentangle the dues in respect of which there could be a right of appeal from the cargo handling charges in respect of which there was not a right of appeal. That seems to us to be a problem, because there has been an increasing practice of imposing such combined charges when a ship enters a port and wishes to have its cargo handling done by the port authority as well.

I make it clear that we do not disapprove of the combined charges practice. In many cases it is perfectly satisfactory to the port user and to the port authority and it may be a perfectly sensible way of charging. There can, however, be occasions when it is impossible for the user to disentangle the dues against which he might wish to exercise his rights of appeal.

Therefore, the amendment makes it clear that harbour authorities indeed have the power to make a combined charge, combining the dues and the cargo handling and any other charges. On the other hand, they do not have the right to make a combined charge where the port user objects to the combined charge, which means, in effect, where the port user asks for a separate identification of the dues element. We are therefore providing that the port user will be able to require that the dues element is identified separately. That will make sure, therefore, that the rights of appeal can be exercised and will not be frustrated by modern charging practice.

That, of course, does not go the whole way. I am sure that it does not entirely satisfy hon. Members on the Opposition Benches, and it will not satisfy some of the waterways interests either. For our part, however, we are content that it would not be right for the Government to go beyond that. There is a distinction between the dues charged for conservancy and maintenance functions, almost by way of a tax, imposed on each owner whose vessels enter a port, and the cargo handling charges, which are a matter really for commercial arrangement, bargaining and negotiation. We are therefore content for the appeals machinery to be confined to the dues. We hope that the amendments will clarify the dues charging arrangements, enabling them to be identified separately and, thereby, making sure that the appeal provisions can be used in practice by users.

My hon. Friend the Member for Brigg and Scunthorpe (Mr. Brown) pressed me on this, as did the hon. Member for Kingston upon Hull, East (Mr. Prescott). I hope that they accept that we have responded in part to their request and that what we are proposing is certainly an improvement to the Bill as it originally stood.

Mr. Prescott

We would be churlish not to welcome what the Minister has presented for us this evening in regard to complaints about the appeals concerning dues and charges on ships. We put forward an amendment, and I think that it was supported to a certain extent by the hon. Member for Brigg and Scunthorpe (Mr. Brown), bobbing in and out of the Committee, though we do not have even that advantage this evening.

I think that the proposal that is being put forward by the Government goes at least some way to assist people who have serious argument about the charges that are imposed by a port authority. We must recognise that what we are doing in the Bill is strengthening existing port authorities in regard to the extra functions which they may have in being able to have road haulage and agency firms and such matters which heighten the fears concerning, I would not say a monopoly situation but perhaps an oligopolistic kind of situation, as The Economist seeks to call it. Nevertheless, it is a matter of some concern, and I think that when an aggrieved person whose business may depend upon entry through a port may be charged something against which he has no appeal, injustice is likely to be perpetrated.

Living in the areas of the British Transport Docks Board and the port of Hull., I well know the feeling and the possibilities of getting people like Sir Humphrey Browne to recognise any kind of rational argument in these areas. Indeed, I cannot believe that the Secretary of State has achieved this without some considerable argument behind the scenes with the personalities involved in the British Transport Docks Board, because presumably, as a large authority that is involved in this situation, it has been faced constantly with the combined charge situation being the normal development in the docks industry—that is, where people might rent a pier or take the whole situation of an operation of one part of a port. I can think of many examples in my own port area where it is a contracted price and no difference is made between the various dues that will apply. It is one charge

The most common example used by people in these cases is that of the container box, which is a good example. The charge is on the box, but inevitably the charge includes an element relating to dues and goods. They pay a proportion of that. I shall address my remarks simply to the dues argument. We pressed in Committee for charges to be included. I think that in regard to the dues it is a welcome move.

There will be a requirement now on a port authority to identify the differences in the charges, and they can be quite considerable. It is no coincidence that I and a number of North Humberside MPs, of both parties, have had to meet various employers in our cities who were very concerned about the dues. It was nothing to do with labour charges; it was simply the dues themselves. They gave us a table for the unloading of the same ship at different ports.

The differences are quite considerable. For example, for the same ship of a registered tonnage of 2,000 tons discharging chemicals, in Hull the figure was £6,220, in Immingham it was £5,420, in Middlesbrough it dropped to £1,736, in Ipswich it was £1,736, in Sheerness £7,800, in Liverpool £4,160, in Glasgow £3,480 and in London nearly £5,000. That is simply on dues. Those are the charges that the port authority itself assesses as a charge to be imposed for the services that it provides. As the Secretary of State said, that can make a customer decide to go where it is cheapest.

These port dues tend to reflect the amount of investment and the interest rates, and the time of that investment will be reflected in the dues. A port of some considerable investment in the last few years will be carrying a quite considerable levy. Therefore, good investment does not necessarily mean that one will reap the benefit of it if the total charge to bring the system through one's port is excessive, which is the matter of concern. I think the House will agree that those differences are quite considerable. Also, the two British transport docks boards on the Humber itself have considerable differences, quite apart from those of other port authorities in other regions of the country.

That is one example where, clearly, there can be a grievance about such charges. I think that at least the Minister tonight has made it a little easier to identify the problem and then to be able to seek the possibility of getting an appeal to the Secretary of State now that he has taken on that function from the National Ports Council once the Bill has been passed.

9 pm

I presume—perhaps I was not listening carefully enough to the Minister—that in the contractual arrangements discounted rates will apply. Will the ports be expected to show the various discounted rates even in contract agreements? I do not see the necessity for it, because that, I assume, is two people in contract negotiating a contract with the port authority, and I presume that they are equal partners to the contract, and in the main I presume that the authority will not be unnecessarily expected to spell out what the port due is and what the other charges are.

This was an argument that the Minister put later in relation to charges. He felt that if people were in that situation who had already had a contract agreement and charges were disputed through this appeal system and a judgment was made, the whole business of the contractual arrangement would be challenged, because it would be felt that the charges imposed were found to be unfair by the Secretary of State.

In that case a contractual relationship between the two would—he was implying—be affected by what agreement was arrived at out of the decision reached by the Secretary of State on an appeal to him that these charges were unfair, because presumably that is the basic complaint that people would be making to him about that matter. Therefore, I wondered what the position was in regard to those contract situations.

There is one other point that the Minister did not mention, and I do not know whether it applies in this case. The hon. Member for Brigg and Scunthorpe followed on some of the points that I have made about this, where the port authority is also the conservancy authority. In those circumstances charges are imposed upon ships that may not come into the expected port but go on to another area. In those cases, will those conservancy charges be for appeal? Presumably such charges will be imposed.

I did not find a great deal of complaint about the right of an authority to impose charges on small boats going down the rivers. I said in Committee that I thought that to be a legitimate charge, but I wonder about that now, particularly as the National Waterways Transport Association had made it clear to us in letters received in Committee that it felt that since this was now going to be a private body it did not feel that a private body should be in competition with it, in that sense, directly to control the conservation charges to it and therefore affect its transport.

That would be the complaint of those who have wharves down the Trent. Perhaps the Minister could tell us whether the conservancy charges would allow a possibility of appeal.

Finally, the main issue about appeals is the one that the Secretary of State and the Minister have heard from us in regard to Hull. We shall now have the right to appeal against charges that may be imposed by the dock authority for dues. That is clear. The Minister has now made it clear that that is so and that they must provide the differences so that people can make a judgement.

Unfortunately, the charges are equally important. I point to the charges imposed on the Hull fish dock. The Minister will know that all the Members of Parliament for North Humberside, of both parties, came pressing on him the judgment that had been arrived at by the British Transport Docks Board to impose a charge level eight or nine times the level in Grimsby. There was a considerable difference for the same ship unloading the same cargo. The judgment by the board was Because you have not got as much fish now, you have been kicked out of Iceland, and you have got nothing off the Community, we are now saying that we must get everything out of the two ships that come into the harbour instead of the 100 ships that used to come. Clearly, no fish authority and no industry could possibly survive with such penal charges. It is when a port authority decides to take that action that we really are in difficulties. In this case, if there are charges other than the dues that are coming into the wharf, there will be no appeal against the port authority closing down this port.

By "closing down" I do not mean closing it, emptying it of water and filling it in; that requires statutory permission. I mean that labour is not provided to open the gates and that vessels that come in are no longer serviced.

I am bound to tell the Minister that despite the brave attempts made by all involved—labour and management—to secure a fish landing facility in Hull, we now face considerabe dangers, with the delay in the agreement yet again, of the BTDB moving in and seeking to achieve the policy that it sought to achieve some while ago, which will now be made much easier if it is a private organisation—a point that will not be lost on Sir Humphrey Browne; not that he took much notice of directions from the Secretary of State, as I understand it, which meant that the only influence that one had was to try to build up some kind of public pressure. One hopes that that will continue to be so.

If the Minister had accepted our amendment to include charges it would have been easier for a community to argue the case that it was necessary for that community to maintain a fish landing facility, because Hull without a fish landing facility is not a fishing port. That is the reality, and if that decision is not profitable to the British Transport Docks Board it cuts off all the other industries that depend on access to that port, and a fishing facility. We look with considerable apprehension at what will happen if Sir Humphrey Browne is able to levy charges higher than those realised in other fishing harbours and is able to secure the end of a fish landing facility in Hull.

We give Sir Humphrey fair warning. We will not accept it. We will do everything that we can to stop it. I am sorry that the Minister did not accept our arguments to include charges, because then we would have appealed to an independent board to make a judgment whether the decision was right and proper in regard to the charges that have been imposed and that have brought about the present situation.

In the final analysis, as the inquiry on the appeal on charges in Grimsby showed some years ago, the controversial inflationary accounting adopted by the British Transport Docks Board was a policy not pursued by any other companies; it was a policy that discriminated against BTDB ports and affected the fishing industry particularly. In that case the National Ports Council upheld the appeal of the industry, but the Minister, while now making it clearer, has not made it easier.

If the Minister had accepted our amendment about charges we would have been in a better position to fight to retain Hull's fish landing facilities, which we intend to do. We will not accept any dictat that Hull's fish landing facilities will close, but we have been denied the possibility of an independent body to check the operator making a decision that is commercially advantageous to him but that sounds the death knell to a fishing port like Hull.

We welcome the amendments that the Minister has put before us tonight, but we are sorry that he has not gone so far as to include the charges.

Mr. Kenneth Clarke

The hon. Gentleman asks about the extent of the dues in respect of which the harbour authority will be under a duty to publish lists and in respect of which a right of appeal will exist. We are not altering sections 30 and 31 of the Harbours Act 1964 in that respect, so the ship, passenger and goods dues will remain the only charges subject to appeal. I believe that does not extend to the conservancy charges imposed by a harbour authority, which also has a conservancy duty in respect ships that pass through on their way to another port. If I am correct in that, and such dues are at the moment not appealable under section 31 of the 1964 Act, nothing in the Bill will make them appealable.

We are preserving the previous rights of appeal but we are not extending them in any way. We are also making it clear that the duty to list charges and the rights of appeal against them do not extend to combined charges. On the other hand, where dues are charged that are subject to a composition agreement or a specially agreed rebate, which was another question asked by the hon. Gentleman, such dues will not be liable to the Harbours Act 1964 and the appeal procedure as revised here.

If one looks at the amendment one sees that it states, in subsection (6): References in this section to the dues of charges actually provides that where a rebate is contained it is not liable to the listing duties and the appeal charges. We are talking about straightforward dues; we are talking about the case of a port user who objects to having a combined charge, when the dues are identified and can be appealed against to the Secretary of State.

Those dues that can be appealed against vary widely from port to port, as the hon. Gentleman said, but that reflects the differing costs that have been incurred for the maintenance of channels, quays, lights, and so on, for which these dues are properly charged, and in exercising his appeal function the Secretary of State will continue to act in the same way as the NPC has, and will seek to make sure that they bear a reasonable relationship to the costs imposed on the port authority for maintaining the various sorts of necessary hardware of the port.

The hon. Gentleman expressed regret that we had not extended the provision to cover charges generally, and he cited the problems that the fishermen of Hull have been having with BTDB as an example showing that an appeal procedure might have helped. As I told him about 12 months ago, when we discussed on the telephone the charges for a particular fishing boat, the BTDB was already being allowed by the Government to exercise its own commercial judgment and its own commercial freedom; there was no ministerial direction on Sir Humphrey Browne and the board then. They were to charge a set rate for an Icelandic vessel trying to put into Hull. It was, in fact, in response to public pressure and at the request of the hon. Gentleman and his constituents that an agreement was satisfactorily achieved. Given the future of the docks business and the highly competitive and commercial nature of the industry, that seems to us the most satisfactory way of resolving these problems.

The charges for cargo handling, goods storage, and so on, are part of a highly competitive business. Each of the British ports is in close competition—sometimes fierce competition—with the other British ports. Even in the Humber, where the BTDB are the owners of the four major ports, there is still to some extent competition between the different ports, although it is all within the same ownership, and it is not the case that the BTDB provides all the cargo handling labour in all those ports. My recollection, off the cuff, is that in Hull most of the stevedoring is now provided by the BTDB, but that is by no means the case on the south side of the Humber. There are still private providers of stevedoring and cargo handling facilities with whom the BTDB are in competition, and competition for those essentially commercial services has always been relied upon in the past. There is no existing appeals machinery, and it seems to us the best safeguard for port users in the future.

Having said that, we have not gone the whole way. We accept the need to clarify the appeal rights in respect of dues, and I am glad that the amendment is welcome to that extent, at least.

Amendment agreed to.

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