HC Deb 23 April 1998 vol 310 cc1064-72

Motion made, and Question proposed, That this House do now adjourn.—[Mr. McAvoy.]

10 pm

Dr. Alan Whitehead (Southampton, Test)

I am delighted to have been selected for this Adjournment debate. I too have a small apology to make. Because, I imagine, of my handwriting in submitting my request for the Adjournment debate, as some people may have noticed, the Order Paper earlier stated that the proposal was to discuss Dibdon bay. I see that the immensely clever people who write the Order Paper have, through their erudition rather than my assistance, now amended that to the correct spelling. I apologise if the House had been misled.

This debate is about not just a bay, however we spell its name, but the viability of a great UK port and the future of UK ports in general. My aim is to place several arguments on the record, so that the local discussion, when it comes, will consider all the issues: local amenities, environmental concern, transport links and national and indeed international issues relating to shipping in ports.

I emphasise at the outset that no detailed planning proposal for Dibden bay has yet been submitted. I am therefore not asking the Minister to pronounce on a particular proposal; I would be most surprised if she did. However, I hope that she will join me in emphasising the importance of effective UK ports, because that is the heart of the issue.

Where does the issue start in the case of Southampton? Dibden bay sounds a very romantic place. It was historically a bay, but it is now effectively a large area of reclaimed land, situated between Marchwood military port and Hythe marina on the western side of Southampton water. It is owned by Associated British Ports and was reclaimed in the 1940s, with further reclamation in the 1980s.

ABP proposes to build a new container terminal with 1,850 m of quay on the site, and to provide a purpose-built rail terminal and an access road carriageway to service it. Although the land is entirely reclaimed and does not form part of the heritage area of the New forest, the mudflats in front of it are of environmental significance. ABP proposes to construct a 40-hectare creek to create new inter-tidal mudflats, together with an extensive area of landscaping. I understand that those proposals have already been discussed in some detail with the Royal Society for the Protection of Birds.

The proposal has strong advocates and strong opponents in the Southampton area. I am obliged to my parliamentary colleagues, the hon. Members for New Forest, East (Dr. Lewis) and for New Forest, West (Mr. Swayne) for writing to me expressing their sorrow at being unable to attend the debate. They take a different view from me, but it is based, among other things, on the impact of the proposals on the New forest area. That is understandable, and I expect them to do their job as constituency Members of Parliament. The impact on the area is my concern also.

I hope that those hon. Members will listen carefully to the issues I have raised and think carefully about the consequences of the wider issues of development upon Southampton port, which include the validity of the case for port expansion in Southampton and the significance of hub ports in the rapidly changing world of container shipping. I accept that there are real environmental and transport concerns about the proposals, but I hope that my contribution can focus the debate at the right level of concern. We should properly take immediate local issues into account.

We have a duty to ensure that development takes place with the least practical environmental damage, but we must also look at the wider national and international case when deciding whether to support the aims of the proposals. I understand that the immediate view might be to regard grass as clean and environmentally friendly and ports as dirty and industrial. However, an effective ports policy and the possibility of transporting much of the United Kingdom's freight by sea from hub ports is an immense potential environmental gain. Transporting a tonne of freight over a kilometre of sea is 20 times more effective in energy terms than transporting the same amount by road. The issue is perhaps not as clear cut as we might think at first glance.

In order to understand the essence of the issue, we need to understand the role of ports in the United Kingdom economy. To do so, we must realise what is happening in the world of container shipping. Ships are getting larger, and are delivering loads assembled from a large area and intended for distribution to equally large areas. Ships traverse the globe, carrying an ever larger number of containers, and they require the facilities to berth them.

The latest generation of ships, already built and operating, can take up to 8,000 boxes. They can be handled only by ports with a strong infrastructure and sufficient water and wharfage. Those ports will need to be able to distribute loads efficiently, and must therefore have good road and rail links. Above all, they must have good deep-water access. They are likely to be required close to the main deep sea shipping routes between Europe and the rest of the world.

Probably only three ports will fully fit the requirements by early next century—Southampton, Thamesport and Felixstowe. Those are firmly established international trends now. This method of transporting large quantities of bulk freight will not go away.

I have recently received a copy of a letter from the leader of the county council which was sent to local Conservative Members in Hampshire. He says:

Our understanding is that the need for the development of Dibden bay hinges very much on trade with the Far East. Only a moment's reflection suggests that, with the present upheaval and turmoil in the Far Eastern economies, this may not be the best time to make decisions about a capital project with a pay-back period of many decades. I think our present view would be 'wait and see' … I should certainly welcome your views on the prudence of making decisions at a time of uncertainty about the future performance of the Far Eastern economies and their trade patterns. I must tell the leader of Hampshire county council that that bizarre argument cannot go unchallenged.

It is simply fanciful to believe that the fact that the Japanese and far eastern economies are in some difficulty will alter the fixed pattern of container shipping from the far east to the UK—that suddenly the large container ships will disappear or not come to the UK. That is out of the question. Indeed, if we take that argument on board and indulge in short-term thinking, we will potentially throw away our stake in the UK's industrial future.

Ninety-five per cent. of the United Kingdom's imports and exports go through ports. We must get our ports policy right in the long term, by doing the thinking now. Hub ports are at the heart of that thinking. They will serve as the prime ports of entry, redistributing to either other UK ports or UK inland destinations, and receiving goods for shipment in return. Trade is likely to be concentrated on those ports, but there are problems—the capacity of the hub ports, for example, and the structure of world container shipping lines. Together, they present a difficult scenario for those who believe that our ports can stay as they are.

If the new generation vessels cannot dock or discharge, not only will those ships that will go elsewhere, but the lines and consortiums operating them will naturally base their operations on particular ports. They will take the whole of their business to other ports. In other words, there will be no such thing as a static hub port. Hub ports will either have to evolve to meet the new shipping challenges, or they will almost certainly shrink rapidly.

The consequences for Southampton are obvious. Currently, the port of Southampton is almost full, if we include the present roll-on/roll-off and bulk services in the picture. It has no land or wharfage on which it can develop at its present site. According to the argument I outlined, it will either consolidate its role as a national hub port with Dibden bay or it will shrink to only regional significance without it.

There are also severe consequences for the UK economy of a failure to deal with the need for effective hub ports. Ships entering the English channel from deep-sea voyages can, in effect, turn left or right to unload. That is not a terribly nautical term, but it sums up the choices available to ships entering the English channel. They can berth in England or in Rotterdam, Antwerp, or, perhaps, Le Havre. Ports in France, Belgium or Holland that can offer good facilities will capture hub trade from the UK.

The French Government have recently shown that they take the issue seriously, and that they will continue to subsidise their main ports. Commissioner Kinnock is pursuing the issue of a level playing field for ports, but we should not underestimate the threat of continental competition on major UK ports.

Containers arriving in Rotterdam can be transhipped or sent to the UK by a combination of sea and rail, but only at a cost. That cost is estimated to be a premium of about £100 per box, so, if our long-term policy succeeds in driving that traffic to turn right when it enters the English channel, we will, among other things, add considerably to the cost of UK industry, with all the consequences that that entails.

My central case is therefore that we need a strategic view of ports policy. I hope that the Government will tackle the issue in the forthcoming White Paper on integrated transport. We need to ensure that there is a full debate on the exact plan, infrastructure and environmental design of any development on Dibden bay. It is proper that ABP should fund all those elements which will make the eventual design work satisfactorily, although I have to say that that does not appear to be the case currently with other European ports often in direct competition to Southampton.

I suspect that the question whether in the European Union we should subsidise all or none of our ports is one for another day, but the debate on Dibden bay is more immediate. It will be entered into shortly, and I know that environmental concern will be a prime weapon.

An environmental policy on ports would be greatly helped by a clear definition of what the country needs in terms of port facilities. We know now that demand for development in each of the three emergent UK hub ports will be considerable. The options will not concern development at Southampton; or, failing that, Thamesport; or, failing that, Felixstowe. They will come down to the choices we make to allow a hub and feeder port strategy to work overall in the UK.

In the 1980s, there was a free-for-all in port development. If someone had money and saw the chance to capture business, that was okay with the Government of the day. We got superfluous terminals in inappropriate parts of the country, sometimes at great environmental cost.

A proper view of strategic need would put an end to the practice of considering each proposal as if it were on a planet all by itself. Areas in other estuaries in the UK will remain untouched as a result of a proper ports policy. That must be a gain for those who want to see industrial development tempered with environmental considerations. We will have within our grasp the ability to move freight by far more appropriate environmental means. These are real gains, which can be made by thinking holistically. I hope that that is what we will do in the upcoming debate on the development of Dibden bay.

10.15 pm
The Parliamentary Under-Secretary of State for the Environment, Transport and the Regions (Ms Glenda Jackson)

I congratulate my hon. Friend the Member for Southampton, Test (Dr. Whitehead) on obtaining this debate on Associated British Ports' important development plans at Dibden bay, Southampton. As my hon. Friend chairs the all-party group on ports, it is hardly surprising that his cogent and informed speech touched on issues and interests that ranged wider than those of particular interest to his constituents.

My hon. Friend spoke of the importance of Associated British Ports' operations to Southampton and the surrounding region. There is no doubt that the prosperity of the port is closely linked to that of the city. In connecting the UK not only with Europe but with the rest of the world, the port plays an important part.

I understand that research commissioned by Hampshire county council and Southampton city council in 1994 confirmed that the port is a major contributor to the economy of Southampton and the region. Another report estimated that 13,000 jobs were directly dependent on port activities, with a further 2,000 to 4,000 dependent on the expenditure of port-related companies and their employees.

In total, port-dependent activities were estimated to account for around 6 per cent. of all employment in the Southampton travel-to-work area—an area which experienced a significant loss of manufacturing capacity and employment in the 1980s, compounded by reductions in defence expenditure in the 1990s. Therefore, the full-time and semi-skilled jobs provided by the port are particularly valuable.

The port has continued to prosper. In 1996, annual traffic had risen to a record 34.2 million tonnes, including nearly 6.8 million tonnes of container and roll-on/roll-off traffic, accounting for over 6 per cent. of total trade through UK ports. The port is an increasingly busy operation, which also reflects substantial investment through the opening of new facilities and of latest developments in cargo-handling technology. This investment, together with the port's natural deep-water advantages and geographical position, has enabled it to compete successfully in a very competitive market.

An important issue facing ABP is how to maintain and build on this success in the light of international trends towards bigger ships and fewer but larger international hub ports in Europe. ABP's response has been to promote expansion of handling capacity through Dibden bay. The commercial and financial feasibility of proceeding in this way is primarily a matter for ABP, but proposals of this kind inevitably raise a wide range of planning and environmental issues.

Although ABP has not so far submitted applications for the necessary consents, I know that there have been discussions with environmental bodies, the relevant local authorities and my officials in preparation for a public consultation exercise, possibly leading to the submission of consent applications later this year. Procedures are complex, as various consents are required under different legislation. A local public inquiry will almost certainly be held, with the final decision resting with the Secretary of State.

My hon. Friend did not expect me to pronounce on any particular proposal, about which I am relieved, as it would be improper for me to express any view now on the merits or otherwise of proposals for the development of Dibden bay. The public inquiry will address the relevant issues, including environmental impacts, economic benefits and conformity with development plans and with national policy. However, it may be helpful if I say something generally about these issues, without prejudice to future decisions on any formal proposals from ABP.

My hon. Friend raised a number of points about the Government's general policy towards ports and port developments. As the House knows, we plan to publish later this spring a White Paper setting out the Government's integrated transport policy. It will show how our policies can improve the role of the United Kingdom's transport system in supporting employment and sustainable economic growth, as well as protecting the environment. It will also suggest ways in which the best use of ports and shipping can be promoted.

Recognising the importance of shipping, and concerned at the decline in the British merchant fleet, my right hon. Friend the Secretary of State last year set up a shipping working group to examine how the decline could be reversed. He is now considering the working group's report, with a view to publishing his conclusions after the White Paper.

As our recent response to the European Commission's Green Paper on ports and maritime infrastructure made clear, we will continue to support policies that encourage competition and efficiency in the ports industry on a fully commercial basis. We shall also ensure fair employment standards and better, more effective regulation of safety and the environment. It is important to recognise that our ports are competing vigorously, both in the United Kingdom and in the European market. We therefore support measures to develop a level playing field throughout Europe, which is why we broadly support the principles in the Green Paper.

I reassure my hon. Friend that the Government recognise the importance to the United Kingdom of our ports. They are a vital link in the supply chain, with, as he said, some 95 per cent. of our international trade by volume—moreover, considerable domestic traffic goes through them. We must ensure that ports are integrated into our transport networks in ways that contribute to the achievement of a more effective and more environmentally friendly transport system.

Our ports cannot be developed in isolation. Virtually all ports depend upon freight movements by road. Many have rail access, and some support the movement of people, mostly in their cars or private coaches. Policies for these modes need, in turn, to reflect the role of ports.

Our broad aims are to ensure that ports play a full role in supporting the competitiveness of their regions, and that any port development is sympathetic to the surrounding natural environment and local communities. We must also ensure that greater use is made of rail and water links where they are practical and economic options, although it would be foolish to pretend that road connections will not continue to play a very important role.

The ports industry is diverse; the supply chains it serves are even more so. Demand for their services is derived—their customers have varied and changeable requirements. The shipping industry operates in a highly competitive world market on very tight margins, and is sensitive to minor and unpredictable international economic, political and commercial factors.

Nevertheless, as my hon. Friend said, some trends are clear, notably the strong and continuing increase in the use of freight containers and road trailers—unitisation—as opposed to the carriage of goods in semi-bulk form. Container ships are now larger, and have access to only a few ports, with deeply dredged access channels. As my hon. Friend pointed out, internationally, the shipping industry is concentrating on hub ports for its main liner services, with other ports providing only feeder services.

Last year, Southampton served eight container lines, and handled 893,000 units. Three quarters of that business is with the far east—indeed, the port handles half our far east trade by volume.

There are pressures on capacity, but ports have shown a considerable ability to absorb additional traffic without physical expansion. Development pressures remain, of which the Dibden bay proposal is an instance. It also clearly illustrates the sensitivity of port expansion projects, since protected habitats are liable to be affected.

There is no doubt that the Solent area is outstanding in nature conservation terms. There are many sites of special scientific interest in the area, and proposals for four international conservation designations under the habitats directive will shortly be considered by my right hon. Friend the Secretary of State when discussions arising from the consultation are concluded.

It is surely right that any plan or project should be assessed in the light of a proper evaluation of its possible adverse effects. The aim should be to mitigate and compensate for those, in order to maintain the quality of our environment and its biodiversity. Transport projects are not an exception: land take and other environmental impacts of new transport infrastructure have been very significant. We aim to minimise them in future, and to ensure that environmental effects are taken fully into account in investment decisions.

The habitats directive, which sets out the safeguards for the internationally important sites it will protect, emphasises the importance of sustainable development. Any plan or project that will affect the integrity of such a site can, in the absence of alternatives, be approved only on grounds of overriding public interest, and with the provision of compensatory measures.

The directive imposes those specific tests for any development that may affect internationally important wildlife sites. I believe that the tests represent a logical extension to those special sites of the principles that I have outlined. I understand that ABP Southampton has already been discussing informally with English Nature its plans for Dibden bay, with a view to minimising or removing the impacts on the local bird populations and habitats.

There will also be a range of planning issues to consider at Dibden bay. The 1994 regional planning guidance identified Southampton as one of the most important ports in the country. The guidance also recognises that the ports industry generally needs to continue to adapt to changes in patterns of international trade.

Hampshire county council's structure plan is in the process of being revised. When a new plan is adopted, it will provide guidance for development in Hampshire at a strategic level well into the next century. It will identify the general pattern of development and provide a set of policies to enable communities, businesses and institutions to know where to invest in Hampshire.

The draft structure plan deposited in 1996 proposed a policy to allow, exceptionally, for port development at Dibden bay where such development is in the interest of the regional and national economy. However, the Government office for the south-east, on behalf of the Secretary of State, objected to the policy, on the grounds that it was overly restrictive. The panel, known as "Examination in Public", that conducted the structure plan review in which the policy was discussed, has subsequently reported to Hampshire county council, and recommended that the policy be modified to provide a more positive approach to port development.

The county council has published the panel's report for information, but it has not yet formally determined how to respond to any of the recommendations, including on the Dibden bay policy. It is the responsibility of Hampshire county council, jointly with the two unitary authorities of Portsmouth and Southampton, to decide what modifications to propose to the deposited review plan in the light of the panel's report. We wait with interest to learn what shape the Dibden bay policy will take.

In the emerging New forest district local plan, Dibden bay has been identified by the local planning authority as a site of importance for nature conservation, which means that the local authority considers that the area is of critical importance for nature conservation within the district. It is also identified as being within a strategic gap.

The inquiry into objections to the local plan has now been completed, and the inspector is expected to report this summer. It will be for New Forest district council to decide what account to take of any recommendations that the inspector may make on the issue.

Environmental concerns are not confined to the marine habitats proposed for designation under the habitats directive. Road and rail access are also likely to be important issues for Dibden bay. I understand that a road link is proposed with the A326, a local authority road, and that Associated British Ports is seeking to resolve the issues that that raises with the county council.

I understand that ABP is also in discussions with Railtrack over improvements to the rail infrastructure. Wherever practicable, we want to get more freight on to rail, and we are working to establish more effective and accountable regulation and to establish a new rail authority to provide clear, coherent strategic programmes for the development of the railways, so that the aspirations of rail freight operators and users can be met.

We have already taken action to boost take-up of freight grants, and that is proving successful. We are also considering what else might be done to boost rail freight in the context of the integrated transport policy White Paper. Southampton port, which has good existing, albeit partially under-used, rail facilities, is well placed to move more freight by rail, and Railtrack's planned increase in route capacity approaching the port is a welcome step in the right direction.

I repeat that I am grateful to my hon. Friend for bringing the issues associated with the development of Dibden bay to the attention of the House. The subject raises some challenging issues for transport policy in general, as well as for the port. Those will undoubtedly get a thorough airing when a formal application has been made and the statutory procedures get under way. I am sure—

The motion having been made at Ten o'clock, and the debate having continued for half an hour, MR. DEPUTY SPEAKER adjourned the House without Question put, pursuant to the Standing Order.

Adjourned at half-past Ten o'clock.