Hovercraft (Hansard, 22 July 1987)

§ The Parliamentary Under-Secretary of State for Transport (Mr. Peter Bottomley)
I beg to move, That the draft Hovercraft (Civil Liability) (Amendment) Order 1987, which was laid before this House on 9th July, be approved. I am sure that the House would like to know that I am a great expert on hovercraft. I travel on them, and most of my family seem to operate, service or own them.
I trust that the order will be non-controversial. Its purpose is to increase the limit of liability for operators of hovercraft, as currently prescribed in the Hovercraft (Civil Liability) Order 1986, in respect of claims made against them arising from the death or personal injury of passengers carried by hovercraft. The hovercraft liability regime is somewhat different from that for ships. However, the maximum for passenger liability for death or personal injury is derived from the Athens convention. The draft order seeks to increase the present liability limit to £80,009, in line with the increase introduced on 1 June under the Athens convention for ships. In that respect, the order restores parity between the two types of transport.
The terms of the Athens convention have been applied under United Kingdom law since 1977 and the convention entered into force internationally on 28 April this year. The tragic loss of the Herald of Free Enterprise on 6 March brought the convention into sharp focus. The Government subsequently announced their decision to use the right given in the Athens convention to increase the limit of death or injury liability for sea passengers carried by United Kingdom carriers to £80,009. As the House is aware, that increase came into effect on 1 June.
It is appropriate that this revised limit should be extended to hovercraft to maintain the link with vessels. The draft order does no more and no less than that.

§ Mr. Tony Lloyd (Stretford)
This will be a short, but important, debate. As the Minister has explained, we are still living very consciously with the memory of the disaster at Zeebrugge. While the order simply brings parity between hovercraft and shipping, and to that extent the Opposition do not disagree with the principle, it allows us to examine more generally the principles upon which compensation is based.
Compensation is important for the victims and the relatives of victims of disasters whether involving hovercraft, ships or any other form of transportation. There is a fair degree of inconsistency at the moment between different forms of travel and the levels of compensation available. There is an issue of principle there.
There is a wider-ranging issue which involves the reasons that lie behind imposing a limitation upon the liability of carriers. An argument can be put—and I will advance it—that levels of compensation for shipping or hovercraft are lower than is necessary or acceptable. We all recognise the need to drive for ever-increasing safety. Safety on hovercraft or on other forms of transport cannot be achieved simply by imposing financial liabilities on the carrier, although we accept that it is important that there should be an adequate number of marine surveyors. Indeed, the Opposition argue that we do not have enough 419 of them. It is also important that there is adequate trade union representation on hovercraft. That issue is in dispute at the moment between the National Union of Seamen and Sealink. The existence of some system of liability is important to ensure that financial penalties are imposed on carriers if they do not conform to acceptable safety standards. That is important as a means of reassuring the public, especially when a perception arises that recently profits may have been put before the lives and safety of passengers.
We do not in any sense disagree with the view that compensation liability should exist. The difficulty lies in deciding what limits we should impose. The Athens convention, as I understand it — I am sure that the Minister will correct me if I am wrong—remains at the lower level of £38,000 with regard to foreign carriers transporting United Kingdom passengers in United Kingdom waters. The higher level of £80,000 has been introduced only for domestic carriers. At that level, we accept that we must approve of the principle that brings hovercraft into line with shipping. We agree with the Government there. However, the difficulty lies in deciding whether the limit of £80,000 is enough.
In a debate in Standing Committee in March this year, the then Parliamentary Under-Secretary of State for Transport informed the Committee that he intended to go to the International Maritime Organisation and pursue a demand that the legal committee should examine and increase the limits on liabilities. Will the Minister tell us what happened at the June meeting of the IMO? It is important that we are told that adequate representations were made to increase the limits. If the Minister has the information, can he tell us how the United Kingdom compares with other countries in western Europe and the United States in terms of liability? Will he examine the question why we need to impose limitations at all? I accept that we have ratified the convention, that we are stuck with it, and that it states that we must impose the limits set out in the convention.
More generally, in relation to compensation, if, for example, I were to walk out of the House and were run over by a motor car, I would have an opportunity to sue through the courts. It would then be for our courts to determine the level of compensation, not in an arbitrary fashion, but on the basis of the principles that govern compensation claims and damages. The court would examine the circumstances, needs and entitlements of the victim. In the long run, is that not the system that we ought to pursue?
The position now is that, whatever level of compensation is laid down as a limit, it is open to challenge. Air travellers find themselves governed by international conventions and limited to a figure roughly the same as that for shipping—about £80,000. At least there is parity there. I can understand the logic of the £80,000 figure in bringing shipping and hovercraft to the same level as aircraft. However, in international conventions on rail travel, the limit on compensation is £56,108. It is totally separate and arbitrary. Under protocols for road traffic, the figure is £66,795, although the protocols are not yet in force. Again, those figures are literally plucked from the air.
I hope that the Minister will accept my next point as a serious one. In the British courts we have recently seen an award of damages of £1.2 million to a young man who suffered injury and was able to sue those involved in the 420 medical profession. Whatever argument we advance about acceptable levels of compensation, the fact is that awards of £200,000 or £300,000 are not uncommon. The limit of £80,000 for compensation for those who are severely injured or for the dependants of those who are killed in accidents of the kind that might take place on hovercraft is punitive relative to the compensation that might be obtained through the British courts. There is a serious anomaly there and I should like to hear the Minister's views on whether we ought to pursue unlimited compensation under international conventions.
I accept that as signatories to the present convention we are bound by the limits, but it is important to accept that we should pursue limits considerably higher than those that operate at the moment. The Opposition do not disagree with the Government about the limit to be applied to hovercraft. There is considerable sense in making sure that hovercraft are tied to the same protocols and limitations as apply to shipping. The argument is not that hovercraft should be treated as a special case, but that the whole area of levels of compensation is important for victims and dependants. As things stand, those levels are not high enough. I ask the Minister to place on record his own views on those issues.

§ Mr. Peter Bottomley
I thank the hon. Member for Stretford (Mr. Lloyd) for his welcome of the draft order. He raised a number of issues, some of which I do not want to go into in detail. It is worth saying that international conventions generally lead to uniform regimes that have the effect of guaranteeing users and, in particular, employees standards of protection and compensation. They also give a degree of assurance to operators that the expenses and other difficulties that they have to meet in achieving those standards are also faced by competing ship owners or operators in other countries.
Although I accept the common sense of the hon. Gentleman's points about unrestricted liability, having a restriction on liability makes it more likely that people will have the insurance cover required or will be able to face claims arising out of the sort of incidents that we witnessed recently in shipping and that we see occasionally in aviation. We have also seen such accidents involving hovercraft, but on very rare occasions.
The point worth making about international comparisons is that we are the only country to classify hovercraft as a distinct type of vehicle. Most other countries using hovercraft classify them as ships, but in fact most other countries do not operate hovercraft. We have a slightly mixed regime for hovercraft because of the way in which we classify them. I am sure that if we were starting from scratch we might argue, as the hon. Gentleman suggested, for rather greater natural uniformity between different forms of transport. However, given the way that international conventions have grown over the years, the hon. Gentleman will understand that it is not necessarily the best return for effort to try to get all the people involved in the conventions for aircraft to come together with the people involved in the conventions for shipping and, perhaps, to try to get others who do not operate hovercraft to come in as well. Perhaps a greater return for effort comes from taking the opportunities that we have on domestic liability— the point that the hon. Gentleman was asking about.
421 The hon. Gentleman asked about the International Maritime Organisation. When my hon. Friend the Member for Worcestershire, South (Mr. Spicer), then Under-Secretary of State for Transport, announced the decision to increase the limit for United Kingdom carriers, we said that we intended to ask the International Maritime Organisation to undertake an urgent review of the Athens convention and the related 1976 convention on the limitation of liability for marine claims. The recent council meeting of the International Maritime Organisation responded immediately to our proposal, and it was supported by a number of other member states. The IMO has agreed to an early review of the Athens convention and related issues. That is welcome.
On behalf of the House, I thank the hon. Gentleman for allowing us the chance of this short debate. Other issues go slightly wider than the order, but the House may be able to return to them. We are doing well in this instance by raising the limit of liability for travellers in the United Kingdom-operated hovercraft.