§ 4.35 p.m.
The Parliamentary Under-Secretary of State, Department of Transport (The Earl of Caithness)My Lords, with the leave of the House, I shall repeat a Statement being made in another place by my right honourable friend the Secretary of State for Transport. The Statement is as follows:
"With permission, Mr. Speaker, I will make a Statement about the meeting of transport Ministers which took place in Luxembourg on 30th June and which discussed road haulage and aviation.
"In advance of the Council, I submitted to the Select Committees on European Legislation last week an explanatory memorandum about a Community standard for drive axle weights. I was most grateful to them for their speedy response and this Statement responds to the suggestion that, following the Council, I should report progress to the House.
"On road haulage, the Council agreed on a Community standard of 11.5 tonnes for the drive axle of 5- and 6-axled vehicles, to apply from 1992. As the House may recall, a 1984 directive set agreed standards for most of the weights and dimensions for road haulage vehicles operating between Community countries. The drive axle weight for these larger vehicles was left outstanding with a requirement that it should be agreed as a matter of urgency. This is the decision which has now been taken.
"As in the case of the earlier directive, which set some overall vehicle weights which exceeded our maximum of 38 tonnes, we successfully negotiated a derogation of unspecified length for the United Kingdom, to enable us to keep our current drive axle weight maximum of 10.5 tonnes. The directive states categorically that the duration of this derogation will be decided by unanimity, which means that our agreement is needed to what is decided. As my predecessor made clear, we remain committed to the undertaking that there should be 780 no increase in the maximum weight until Parliament agrees and our roads are suitable.
"To accompany the agreement on a drive axle weight standard, we successfully obtained Council agreement on the main lines of the way forward to full international road haulage liberalisation within the Community. First, and most important, the Council agreed on a cumulative increase in the Community quota of 40 per cent. per annum between now and 1992. Community permits are valid throughout the Community giving road haulage vehicles valuable freedom to travel in any Community country. This will therefore provide new opportunities for our hauliers to compete freely on equal terms, and will progressively liberate them from the cumbersome bureaucracy of the present bilateral permit system.
"Secondly, it was agreed that, while bilateral quotas exist, they will be adjusted to meet traffic needs, including the full requirements of transit traffic. Thirdly, the Council confirmed that from the end of 1992 the bilateral permit system will disappear altogether. The detailed arrangements to implement these principles will now be worked out within the Community, and our aim will be to finalise the necessary Community instruments so far as possible by the end of our presidency.
"On aviation, the meeting confirmed that there remains a wide divergence of views. But the Council did agree on two important principles. First, there needs to be a package of measures to promote increased competition, covering market entry, air fares and the capacity that airlines can operate. Secondly, these measures are elements in the process of completing the internal market by 1992. As with road haulage, there will need to be a gradual movement to fully liberal arrangements, but the need to complete that process by the end of 1992 has been established.
"These are useful starting points. There remains a great deal to do, and we must not underestimate the difficulties that lie ahead. My aim, in the British presidency which starts today, will be to build on these basic principles and, if possible, to reach agreement on the content of a first stage in the process towards the 1992 target. But success in this will depend on whether member states collectively are willing to put aside the restrictive practices to which they are accustomed. I put this question to the Council but did not get a clear answer. I shall need to pursue it during the British presidency. If the answer is that, despite the principles agreed yesterday, member states are not willing to make the effort, then they will have to accept that the alternative is increasing court action and other steps to seek direct application of the Treaty of Rome, particularly its competition rules."
My Lords, that concludes the Statement.
§ Lord UnderhillMy Lords, the House will be grateful to the noble Earl for repeating the Statement, which covers three very important points. On the question of road haulage, I am pleased to note that the Transport Minister negotiated successfully the continuation of United Kingdom derogation for our 781 lorry maximum of 38 tonnes and for the drive axle weight maximum of 10–5 tonnes. The Statement says:
We remain committed to the undertaking that there should be no increase in the maximum weight until Parliament agrees and our roads are suitable".The Opposition stands quite clear against 40-tonne lorries. Will the Minister confirm that that opposition also remains the view of Her Majesty's Government?Although welcoming the second part of the document regarding road haulage, referring to the proposed cumulative increase in Community permits, there are a few questions that I should like to put. Will haulage vehicles coming into the United Kingdom continue to be confined to a maximum of 38 tonnes, as are our own lorries? What account was taken of any effect that the increase of Community permits may have on the British road haulage industry and job security?
Reference was also made in the document to opportunities for our hauliers to compete freely on equal terms. Was regard paid to the social conditions of haulage crews, bearing in mind that one of the complaints of your Lordships' own EC Committee in one of its reports was that social conditions are never taken into account by the Community in determining directives?
On the failure to agree on aviation fares and competition policies, I note that the Statement refers to implementation of "fully liberal arrangements" by 1992. What do the Government mean by "fully liberal arrangements"? Does the Minister recall the use by your Lordships' Select Committee of the term "controlled liberalisation"? How far do the Government really intend to go, bearing in mind the consequences and bankruptcies which have followed deregulation in the United States of America? How will full liberalisation, if achieved, affect clauses of the Airports Bill, which is still before Parliament, particu-larly with regard to the Secretary of State's powers to make directives on traffic distribution rules, limits on aircraft movements, allocation of aircraft capacity at certain airports and, also, the development of civil aviation throughout the United Kingdom?
Although everyone would like to have lower fares, will the Government in future negotiations keep in mind certain aspects which happen to be Labour Party policy? These are the sensible use of capacity, the maintenance of a network of services, the highest possible safety standards and the development of employment on terms and conditions which will enable investment for future development? Finally, how far does the Minister believe that fares could decrease? What effect would such a decrease have on British airlines and, in particular, on the possible British Airways flotation?
§ Lord KennetMy Lords, on axle weights the noble Lord, Lord Underhill, has asked questions that we would ask. They can all be summed up in one: what is the maximum permitted weight of lorries from now on? Has it changed? Has the future prospect for that figure changed? Will the Government bear in mind that, in order to achieve a unified market, you do not need to have absolute uniformity of regulation throughout the area of the intended market? We do 782 not at the moment have absolute uniformity of maximum weights for vehicles throughout the United Kingdom, which is, we commonly suppose, a unified market; there are bridges and so on where there is a maximum weight. That being a fact of economic and social life, it is surely just as readily applicable to the larger unified market that we intend to create in the Community, so that we could forever, without infringing commonsense, stick out for lower weight limits for lorries which come to this country.
On air fares, are the Government aware that we at least shall strongly support them if they go even faster than they say in the last sentence of this Statement, about bringing suits before the European instruments of justice about getting on with it? Can the Government confirm that it is at least 20 years since the cheapest available return ticket to Brussels has been mile for mile, about eight times the price of the cheapest available return ticket to New York? This is no way to treat a serious project like establishing a European Community.
Is it not the case that governments which resist change and liberalisation are shown by that mere fact to be quite flippant about the future of the European Community? Can the Government hold out a hope—even a corner of a hope—that we, in the exercise of our presidency, will be a little more ruthless on this point than the Statement says we will be?
§ 4.45 p.m.
The Earl of CaithnessMy Lords, I am grateful for the welcome to the Statement that the noble Lord, Lord Underhill, gave. I will pass on his remarks about what good news it was that we still maintain our derogation to my right honourable friend the Secretary of State. I can confirm to the noble Lord, Lord Underhill, and to the noble Lord, Lord Kennet. that the maximum weight of 38 tonnes or 10.5 tonnes drive axle weight will be the limit for this country, unless Parliament decides otherwise and until our roads and bridges are in a satisfactory condition to bear other lorries, should Parliament decide that those are the lorries that would be suitable for this country.
I can assure the noble Lord, Lord Underhill, that we will continue our monitoring of lorries coming into the country, either at ports of entry or roadside checks in the normal fashion, as we have been doing up to now. That will continue to make sure that other countries are not bringing in heavier lorries than 38 tonnes or 10.5 tonnes drive axle weight. With regard to the social conditions, these are always borne in mind. The directive that we are talking about related to the drive axle weight of the lorries and was an extension of the directive of 1984. The noble Lord will remember that a 1985 directive dealt more broadly with the points that he mentioned.
With regard to aviation, we will proceed to achieve a more liberal market, which we believe to be beneficial. I can tell the noble Lord that this Government would like to see four key ingredients that cannot be taken separately: first, scope for real competition on fares, covering types of fare as well as fare levels, so as to give the consumer a better deal; secondly, scope for airlines to mount capacity on a basis of commercial judgment; thirdly, airlines should be able to enter the market so as to compete on routes 783 already served, or to start up new routes much more easily; and, fourthly, there should be a proper application of the competition rules.
If I may follow on by answering a point made by the noble Lord, Lord Kennet, who said that we should make progress faster, we should indeed like full liberalisation as soon as possible. But we believe it is more practicable to achieve this on a basis agreed by all the members of the Community than by a court case, and now that we have the broad parameters of 1992 we hope to make major strides during the term of our presidency. I am pleased to be able to report to the House that, since I answered a question of the noble Baroness, Lady Burton of Coventry, last week, a new service has been set up by British Midland between London and Amsterdam, increasing the potential opportunity for passengers at a low fare.
§ Lord Boyd-CarpenterMy Lords, is my noble friend aware that many of us on this side also agree with the noble Lord, Lord Underhill, in welcoming the Government's firmness on the weight of vehicles and axle weight? Can he confirm—because one's own observation does not always appear to confirm this—that effective steps are taken at the ports to prevent vehicles which exceed these weights coming into this county from the Continent? Are there really effective steps taken to ascertain the weight of these vehicles and, if they are found to exceed it, are they sent back?
Secondly, on the air side, did the Ministers discuss the very recent decision of the European Court to the effect that restrictions both on fares and, as I understand it, on entry into European countries were illegal under the Treaty of Rome? In view of the fact that the Court decided this just before the Ministers' meeting, did the Ministers ignore this and are we indeed the only country in Europe which hustles and hurries to implement the decisions of the European Court? Surely, when we have a sensible one with which we agree, we ought to be insisting on its application.
The Earl of CaithnessMy Lords, I am grateful for the welcome that my noble friend Lord Boyd-Carpenter gave to the derogation that my right honourable friend successfully negotiated on axle weights. I will pass that message on to my right honourable friend. With regard to enforcement, I can confirm that this is undertaken in a very serious manner and will continue to be undertaken in the same vein. Lorries that exceed the weight will not be permitted on our roads and enforcement action will be taken not only at the ports of entry of the country but in roadside checks by police and traffic enforcement officers.
As regards the point made by my noble friend about aviation, the Court decision made it clear that the competition rules of the treaty apply, but left it primarily to governments to decide the details of the application. That was a great help and was certainly not ignored during the discussions yesterday; nor was it ignored that the Heads of Government had agreed at their meeting in The Hague last week that the liberalisation of transport should apply to aviation by 1992.
§ Lord Bruce-GardyneMy Lords, with reference to that part of the Statement which referred to civil aviation, can my noble friend tell us whether he is satisfied that the commissioner in Brussels responsible for transport has his heart in the deregulation of air fares, or does he occasionally look over his shoulder at the sort of policies which the noble Lord, Lord Underhill, told us reflected the views of the Labour Party in these matters?
The Earl of CaithnessMy Lords, I believe that the commissioner is taking the matter extremely seriously and should like to see greater competition. Indeed, the Commission has indicated that it will wish to take action under Article 89 of the Treaty of Rome if there is not action by the member states themselves.
§ Baroness Burton of CoventryMy Lords, perhaps I may make a short comment. I regret that a consumer conference elsewhere prevented my being in the Chamber until now. Having seen the papers today, is the Minister aware that I am glad that Mr. Moore said that he did not feel he had received a very clear answer? I hope that means that he will press for one. May I ask the noble Earl whether I was right in hearing him say that we did intend during our presidency to make easier the entry of new airlines into the European competition. I think the Minister will agree that that was the one great detail that was missing from the famous Memorandum Two of the Commission.
Secondly, I was glad to hear the noble Earl say that the competition rules of the Treaty of Rome would apply. I should like to ask him whether the Commission members who had been preparing cases, if these were necessary, against those states which did not keep to the competition rules of the Treaty of Rome will now be enhanced. I hope with him that long before 1992 we shall have made much greater progress on the matter of air fares in Europe.
The Earl of CaithnessMy Lords, notwithstanding the noble Baroness's absence earlier, we welcome her to our discussions, particularly as she is a keen liberaliser. Yes, I did say that we would be pursuing the point of easier entry of airlines into the market place. But this cannot be taken in isolation. We are looking for four points, and we want to move forward on all four together.
With regard to what action the Commission will take under Article 89 of the Treaty of Rome, I think it is too early for me to say, not having spoken to the Commission in the immediate past. But having indicated before that it would take action, I am sure that it will be looking carefully at the present position.
§ Lord Fanshawe of RichmondMy Lords, I share the view of other noble Lords on the Minister's successful decision in maintaining the 38-tonne limit. Can he give an assurance that this limit will be carefully checked on vehicles coming through ports from the Republic of Ireland? Surely if they are carefully checked at ports coming into this country, there will be no need to check them on the roads while they are travelling in this country. Can he give us a firm assurance that in no cases will vehicles over 38-tonnes be allowed to land at our ports anywhere in the United Kingdom?
The Earl of CaithnessMy Lords, with regard to heavy lorries coming in from the Republic of Ireland, it too has a similar derogation to us which it put in the 1984 directive and indeed had confirmed yesterday. It is similar to that which my right honourable friend the Secretary of State achieved. We will check with our usual thoroughness vehicles coming into the country. I think it would be impractical for the Road Haulage Association and commerce in general to have every single lorry vetted every time it came in, but we will indeed check up in our usual thorough fashion.
§ Lord Howie of TroonMy Lords, will the noble Earl the Minister remind his noble friend Lord Bruce-Gardyne that it is not really agreeable to cast aspersions, in however veiled a manner, against one of our commissioners in Brussels? After all, some of us do not like the other one either; and if we were all to carry on like the noble Lord, where would it all end?
The Earl of CaithnessNo, my Lords, I regret that I shall not remind my noble friend Lord Bruce-Gardyne of that point because I saw that he was taking careful note of it himself.
§ Lord UnderhillMy Lords, I do not wish to detain the House further, but the noble Earl listed the four points which he said will be taken in a package together to achieve liberalisation. The one question to which he did not reply was whether or not the Secretary of State or the Transport Minister kept in mind in the discussions the possible effect on the four points in the Airports Bill to which I referred and which seem to conflict with complete liberalisation.
The Earl of CaithnessNo, my Lords, I regret that I beg to differ from the noble Lord, Lord Underhill. I do not think it conflicts with the Airports Bill. It is all part of the same process. Of course my right honourable friend bore it in mind during the discussion. But if we can increase the opportunities for civil aviation and air traffic—this was so powerfully argued by my noble friend Lord Boyd-Carpenter and I believe that the noble Lord supported it as being one of our success industries—we must do so without delay.