Lords Sitting of 24 November 1987

Preamble
The House met at half-past two of the clock: The LORD CHANCELLOR on the Woolsack.
Prayers—Read by the Lord Bishop of Ripon.

Lord Rees
The Right Honourable Peter Wynford Innes Rees, QC, having been created Baron Rees, of Goytre in the County of Gwent, for life—Was, in his robes, introduced between the Baroness Young and the Lord Boyd-Carpenter.

Euthanasia
2.47 p.m.
Lord Alport: My Lords, I beg leave to ask the Question standing in my name on the Order Paper.
The Question was as follows:
To ask Her Majesty's Government whether they will initiate an inquiry, by Select Committee or otherwise, to consider the legal, ethical and medical aspects of euthanasia.
The Earl of Arran: No, my Lords.
Lord Alport: My Lords, I thank my noble friend for the Answer. However, is he aware that the British Medical Association has established a high-powered committee with full terms of reference to inquire into this matter in the interests of the medical profession? Might not the Government think it right that, in view of the importance of this subject, which after all is a matter of life and death, there should be a parallel inquiry in order to consider the matter from the point of view of public policy in view of the fact that it is almost inevitable that legislation will be needed eventually?
The Earl of Arran: My Lords, I thank my noble friend for that question. I must at the same time tell him that I am not aware of the independent body of the BMA and the inquiry it is conducting at the moment. We all have the greatest sympathy for those caring for the terminally ill or the old, but legalising euthanasia would only weaken the protection that the law gives to the ill and the aged from those who might be tempted to act for financial gain, out of malice or from other base motives. We do not believe that it would be right to legalise euthanasia.
Lord Jenkins of Putney: My Lords, may I ask the noble Earl whether he has failed to note that his noble friend was not asking for what he has just said? He was asking for an inquiry. Is it not the case that many of us who understand the difficulties think that it is high time that this matter was looked into more seriously?
The Earl of Arran: My Lords, I am aware of the eloquence and the passion that the noble Lord, Lord Jenkins of Putney, showed in the debate of
532
November 1985 during the Second Reading of the Bill. As regards an inquiry, the Criminal Law Revision Committee reviewed the criminal law on suicide and mercy killing in its report on offences against the person published in 1980. It rejected the suggestion that euthanasia should be made lawful in certain circumstances. Your Lordships took the same view in 1985 when a Bill along those lines, which was introduced, as I said, by the noble Lord, Lord Jenkins of Putney, was refused a Second Reading. I am not aware of any developments since 1980 which necessitate a further review of the law.
Lord Alport: My Lords, is my noble friend aware that there has been a change of the law in Holland, and that that is one of the reasons for the medical profession promoting this inquiry? Has he seen the article in the Daily Telegraph today with regard to the discussion taking place in France? Does he not think that the influences at work on the Continent may eventually, and sooner rather than later, have an effect upon public opinion in the United Kingdom?
The Earl of Arran: My Lords, with respect to the Government of the Netherlands, that is their business; at the moment there are no plans for making it ours.
Lord Mellish: My Lords, is the Minister aware that some of us—I do not know for whom I speak but I certainly speak for myself—welcome what he has said? We are delighted to know that the Government are not prepared to consider legalisation of euthanasia.
The Earl of Arran: My Lords, I am extremely grateful for the noble Lord's comments.
Lord Paget of Northampton: My Lords, I seldom disagree with my noble friend who sits behind me. Has the noble Earl considered that of all the life that God created, only to humanity did he leave the choice of whether to live or to die? The animals live because they must; we live because we choose to do so. Is it not time to consider legalistically what right we have to interfere with that decision of our Creator?
The Earl of Arran: My Lords, with the greatest humility, I completely understand what the noble Lord, Lord Paget of Northampton, is saying. In the circumstances, I can only repeat that Her Majesty's Government have no plans to legalise euthanasia.
Lord Nugent of Guildford: My Lords, does the virtue of legalisation depend on whether the right people take it up?
The Earl of Arran: My Lords, I have no comment.

Technical and Vocational Initiative
2.52 p.m.
Baroness Fisher of Rednal: My Lords, I beg leave to ask the Question standing in my name on the Order Paper.
The Question was as follows:
To ask Her Majesty's Government whether they are satisfied with the programmes undertaken in schools by the technical and vocational initiative.
Lord Beaverbrook: My Lords, in general, yes. The technical and vocational education initiative started in 1983. The initiative has been monitored by the Manpower Services Commission and by Her Majesty's Inspectorate. The positive response from the large number of authorities concerned reflects the wide support the initiative has received. The Government have announced the progressive extension of the initiative nationally starting from autumn this year.
Baroness Fisher of Rednal: My, Lords, I thank the Minister for that full reply. Can he say how schools will be fitting the TVI programmes into the proposed new national curriculum when the vocational part of TVI is taking approximately 30 per cent. of the school week?
Lord Beaverbrook: My Lords, TVI will continue to exist in harmony with the national curriculum, enhancing the relevance of what is taught within a framework set by the curriculum. The lessons of TVI have a valuable contribution to make to the development of the national curriculum, particularly in science and technology, and the MSC is closely in touch with the Department of Education and Science on this issue.
In addition, the 14 to 18 year-old initiative extends beyond the period of compulsory schooling covered by the national curriculum. As regards the vocational element of TVI, its aims and criteria require the curriculum to be broad, balanced and relevant in accordance with established government policy on education as set out in 1985 White Paper, Better Schools.
Baroness Carnegy of Lour: My Lords, I should like to thank my noble friend for that response. It is extremely helpful to the House in perceiving the value of TVI. Does he agree that in its excellent survey of TVI, the National Confederation of Parent-Teachers Associations asked parents whether, in relation to their children's schooling in general, they felt that they had enough say in what their children learnt, and how? Further, as a result of that question, much more than half said they did not have enough say. Can my noble friend say how his right honourable friend the Secretary of State for Education and Science will ensure that that fact is reflected in the implementations of the new Education Bill?
Lord Beaverbrook: My Lords, I should like to point out to my noble friend that the Question relates essentially to the Department of Employment. However, as regards the Education Bill and TVI, your Lordships will have an opportunity to debate the Bill in due course. TVI will continue to enhance the relevance of what is taught within the framework of the Government's education policies.
Baroness Turner of Camden: My Lords, will the Minister tell the House whether he is satisfied that
534
enough encouragement is being given to girls under the TVI programme to take up courses in technical education in areas of non-traditional employment?
Lord Beaverbrook: My Lords, TVI is supposed to be completely non-sexist and non-racist. I do not know the answer to the specific point raised by the noble Baroness, but I shall look into the matter and write to her.
Lord Kilmarnock: My Lords, arising from the supplementary question of the noble Baroness, Lady Carnegy, will the noble Lord say whether the Government intend to reply to the National Confederation of Parent-Teachers Associations' report on parental perceptions of TVI? I understand that it was commissioned in combination with the Manpower Services Commission, and therefore it would appear that a government response would be appropriate. Will the noble Lord comment on that matter?
Lord Beaverbrook: My Lords, I do not have an answer today as regards a response to the report. However, I shall look into the matter and write to the noble Lord and to my noble friend.
Baroness Fisher of Rednal: My Lords, will the noble Lord give the House an indication of the problem of placing students for their fortnightly work experience during the course of their study? Is it not the case that places are now drying up in many parts of the country?
Lord Beaverbrook: My Lords, I believe that that is not necessarily the case. Again, I should like to look at the matter more closely, and I shall respond to the noble Baroness when I have spoken to my right honourable friend.

Pedestrians: Safety in Traffic
2.58 p.m.
Lord Gridley: My Lords, I beg leave to ask the Question standing in my name on the Order Paper.
The Question was as follows:
To ask Her Majesty's Government what steps are being taken to give pedestrians priority over traffic in residential areas.
Viscount Davidson: My Lords, the Government undertake a range of advisory and research activities aimed at improving the safety of pedestrians in residential areas. Although the regulation of traffic on residential roads is primarily the responsibility of local authorities, the Department of Transport is assessing effective ways of protecting pedestrians using traffic calming measures.
Lord Gridley: My Lords, I thank the Minister for that Answer and express my appreciation of the work carried out by the road traffic department in this respect. Will my noble friend give an assurance that these important measures for the protection of pedestrians and those who live in residential areas

535
will not be overlooked when planning applications are produced at the appropriate time by, I believe, the local authorities?
Viscount Davidson: My Lords, local authorities have the key role in improving pedestrian facilities and in reducing pedestrian casualties, 95 per cent. of which occur on local authority roads. Central government's function is to assist local authorities by providing guidance and mechanisms for action. I have three leaflets produced by the Department of Transport which have been placed in the Library and which may be of interest to Members of your Lordships' House.
Lord John-Mackie: My Lords, will the noble Viscount agree to protect from motorists the pedestrians crossing the road to the Commons from St. Margaret's? Sometimes, it is hardly possible to cross.
Viscount Davidson: My Lords, I am all for protecting everybody.
Lord Morris: My Lords, does my noble friend agree that it is very little consolation to a pedestrian to know that he has priority when being mown down by an articulated lorry on a pedestrian crossing?
Viscount Davidson: I do not think that I can answer that question, my Lords.
Lord Ezra: My Lords, can the noble Viscount tell the House whether it is part of the Government's plan to reduce the flow of heavy traffic through residential areas? Is he aware for example of the undue accumulation of coach traffic in the Victoria area which is causing a lot of problems for residents there? Some noble Lords may be among those residents. Can the noble Viscount promise some alleviation of the problem before long?
Viscount Davidson: My Lords, I am well aware of the feelings of the noble Lord, Lord Ezra, on that matter. I think, however, that the question is a little wide of that on the Order Paper.
Viscount St. Davids: Can the noble Viscount satisfy my considerable curiosity and explain a "traffic calming" method?
Viscount Davidson: My Lords, I understand that it is a European phrase which has been translated into English. I am not sure what the original is. I understand that the idea is for drivers to drive more carefully and more calmly.
Lord Glenamara: My Lords, can the noble Viscount do anything to persuade motorists in London to allow pedestrians to cross at pedestrian crossings? The way that motorists ignore such crossings is a sheer disgrace. It does not happen in the more civilised, law-abiding cities in the North of England.
Viscount Davidson: My Lords, when driving in London I do my best to stop at every pedestrian crossing, and I hope that everyone else does.
Lord Underhill: My Lords, will the noble Viscount take a look at the provisions in the Highway Code relating to pedestrians at crossings controlled by traffic lights in places where there is no "green man" sign? Not far from my home there occurred recently a serious accident caused by a motorist turning right when the traffic lights were against him. There seems to be no clear indication in the Highway Code about this matter.
Viscount Davidson: My Lords, I think that that is a matter for the local authority. The Government can only provide guidance and suggestions about how to improve road layouts. One of the leaflets that I mentioned shows how accident rates went down considerably when layouts were altered by the local authorities.
Lord Mowbray and Stourton: My Lords, following up the remarks of the noble Lord, Lord Underhill, is it not the Government's policy to advise local councils? For instance, one thinks of Sloane Square by the Underground station and Parliament Square by the Houses of Parliament, where, in each case, there is an almost non-stop progression of pedestrians. If crossing lights are not provided to help the traffic move smoothly, it is bound to give rise to impatience on the part of drivers.
Viscount Davidson: My Lords, I shall bear in mind my noble friend's comments and will inform my right honourable friend of his remarks.
Lord Underhill: My Lords, I am grateful to the noble Lord who has just spoken for following up my question. I realise that layouts are the responsibility of local authorities but the Highway Code is the responsibility of the department. That is the matter about which I asked.
Viscount Davidson: My Lords, I am sorry that I did not have notice of that question. I do not have the Highway Code with me but I shall look into the matter.
Lord Greenway: My Lords, does the noble Viscount agree that now is the time to take a long look at the whole question of urban pedestrian movement, bearing in mind the increasing difficulty and frustration caused to pedestrians in moving about the pavements in London, or indeed when going through the Underground system where the traditional "Keep Left" system is increasingly being abused?
Viscount Davidson: My Lords, I shall certainly convey the noble Lord's comments to my right honourable friend.

West Midlands: Children's Hospital Services
3.5 p.m.
The Countess of Mar: My Lords, I beg leave to ask the Question standing in my name on the Order Paper.
The Question was as follows:
To ask Her Majesty's Government where parents of children in the West Midland Regional Health Authority catchment area are to obtain treatment for their children following the regional health authority's announcement that no further planned surgery requiring intensive care could be carried out because of a lack of suitably qualified nursing staff.
The Parliamentary Under-Secretary of State, Department of Health and Social Security (Lord Skelmersdale): My Lords, children are still receiving the surgery that they require, although delays may occur at the children's hospital in central Birmingham due to staffing difficulties. If a health authority is unable to offer treatment for whatever reason, it is open to clinicians to refer patients elsewhere if they judge it to be clinically necessary.
The Countess of Mar: My Lords, I thank the Minister for that reply, but I must say that I am somewhat saddened by it. Can he hold out any hope for the baby about which so much has been written in the press or for the parents of over 30 other tiny babies and children who are waiting for surgery in the Birmingham area? Can he say whether he is aware of the case of a baby who was transferred to Liverpool from Birmingham some eight months ago and who died on the journey? Parents are very anxious that such a thing should not happen to their children.
Lord Skelmersdale: No, my Lords, I was not aware of the baby that the noble Countess has brought to the attention of the House. It is a very tragic circumstance. The Government sympathise with the predicament in which such children and their parents find themselves through no fault of their own. However, in the case of that particular hospital the matter of resources is not in question. It is a matter of a shortage of trained nursing staff. Regrettably, it is impossible to conjure trained staff out of thin air.
Lord Kilmarnock: My Lords, does the Minister agree that medical advances inevitably give rise to greater demand and expectations which cannot possibly be met simply out of so-called efficiency savings? Can he say what plans the Government have to take into account medical advances in their future funding of the health service?
Lord Skelmersdale: Yes, my Lords, I am on record as saying that demand for medical services is indeed boundless. So far as the West Midland Regional Health Authority is concerned, the region received 24–7 per cent. more money in real terms last year than it did in 1978–79. That enabled it to carry out 24 per cent. more in-patient treatments in 1986 than in 1978.
Lord Molloy: My Lords, is the Minister aware that this problem is not restricted to the West Midlands?
538
There is no point in telling the House that if one cannot get treatment in the West Midlands one should try to get it in some other area because those areas are suffering in exactly the same way. This has probably been brought about by the lack of trained nurses and that situation has arisen because area and regional health managers, who can inflict the cuts in expenditure which cause it, can obtain extra remuneration by so doing. Does he not feel that that is disgraceful?
Lord Skelmersdale: My Lords, clearly the consultants in charge of the case mentioned by the noble Countess in her first supplementary question felt that the operation that was necessary could have been carried out at Liverpool, so the situation is by no means equally as serious everywhere in the country.
Lord Auckland: My Lords, can my noble friend say what on average is the ratio of nurses needed per patient in such very serious and technical cases?
Lord Skelmersdale: My Lords, as I understand it, the ratio of nurses to patients in intensive care units varies. The other day when I was at the Hammersmith Hospital I saw six nurses round the bed of a child in intensive care.
Lord Jacques: My Lords, is there not a strong current of public opinion which feels that more should be spent on the health service, even if less money has to be spent on something else?
Lord Skelmersdale: Yes, my Lords, but I am trying to keep within the bounds of order and the subject of this particular Question. Even with all the resources in the world, regrettably one cannot conjure nurses out of thin air.
Lord Prys-Davies: My Lords, can the Minister explain to the House why the Government refuse to acknowledge that their failure to provide satisfactory health services for all people, wherever they may live, is more costly to the state in terms of increased social security benefits, an increased NHS drug bill and time lost from work than is a few pence taken off income tax?
Lord Skelmersdale: My Lords, that goes very wide of the Question on the Order Paper. I have said that demand for services is boundless and, as has also just been pointed out, people are now receiving life-saving treatments that simply were not available even a few years ago.
Lord Wallace of Coslany: My Lords, will the Minister tell the House why there is a shortage of trained nurses?
Lord Skelmersdale: My Lords, for a number of reasons nurses are not coming forward in sufficient numbers to fill the extra places that are required owing to the expansion of the health service.
Baroness Fisher of Rednal: My Lords, is the noble Lord aware that nursing very small children is a stressful job, even more stressful perhaps than the

539
intensive care of adults? Can he tell us how many places are available in the country to train children's nurses in intensive therapy, where those places are located and whether there are any vacancies?
Lord Skelmersdale: My Lords, I cannot do so in such detail without notice, although I agree with the noble Baroness's introduction to her question. What I can tell her is that there was an increase of 15.2 per cent. up to 31st March 1987 compared with the previous year.
Baroness Fisher of Rednal: My Lords—
Noble Lords: Order!
Lord Cledwyn of Penrhos: My Lords, can the noble Lord tell the House what is the percentage of nurses who have transferred to the private sector over the last three years and how many are now moving to the United States and Canada to find work?
Lord Skelmersdale: Again, my Lords, not without notice. If the noble Lord would like to put down a Question about that very interesting point I should be delighted to answer it.
The Countess of Mar: My Lords, may I ask the noble Lord whether he is aware that the West Midland Regional Health Authority allocated the money for a nurse tutor to train nurses in intensive care but did not allow enough money for state registered children's nurses to be withdrawn from the wards and substituted while they went on such a course? May I also ask him whether it is true that there is only one other hospital in this country which trains children's nurses in intensive care?
Lord Skelmersdale: My Lords, so far as substitution is concerned, this would have been totally impractical and I suggest wrong, because quite rightly in the case of children's nurses, especially in intensive care, students are not allowed.
The Countess of Mar: My Lords, there is no—
Lord Denham: My Lords, I wonder whether the noble Countess will allow me to say this. This is a subject on which people's feelings naturally run very strongly indeed, but it is developing far too widely into almost a debate on the National Health Service as a whole. I think it would be better, as we have spent a long time on this Question, to go on to the next business.

Business
3.12 p.m.
Lord Denham: My Lords, at a convenient moment after 3.30 this afternoon my noble friend Lord Davidson will, with the leave of the House, repeat a Statement that is to be made in another place on the future of British Rail Engineering Limited.

Highland Region Harbours (Miscellaneous Powers) Order Confirmation Bill
Considered on Report
Lerwick Harbour Order Confirmation Bill
Considered on Report.

Merchant Shipping Bill [H.L.]
3.13 p.m.
The Parliamentary Under-Secretary of State, Department of Transport (Lord Brabazon of Tara): My Lords, I beg to move that the House do now resolve itself into Committee on this Bill.
Moved, That the House do now resolve itself into Committee.—(Lord Brabazon of Tara.)
On Question, Motion agreed to.
House in Committee accordingly.
[The LORD ABERDARE in the Chair.]
Clause 1 agreed to.
Clause 2 [British ships]:
Lord Brabazon of Tara Lord Brabazon of Tara moved Amendment No. 1:
Page 2, line 5, ("registered") insert ("in the United Kingdom").
The noble Lord said: At the same time I shall speak to Amendments Nos. 2 and 3. These amendments will enable us to keep within the ranks of British ships until 1st July 1997 those ships which are registered in Hong Kong, where the law on registration presently based on the 1894 Act is to be put on an entirely new footing before the colony reverts to China. I beg to move.
On Question, amendment agreed to.
Lord Brabazon of Tara Lord Brabazon of Tara moved Amendment No. 2:
Page 2, line 10, at end insert—
("( ) the ship is registered under the law of a relevant overseas territory: or").
On Question, amendment agreed to.
Lord Brabazon of Tara Lord Brabazon of Tara moved Amendment No. 3:
Page 2, line 19, leave out subsection (2).
On Question, amendment agreed to.
Clause 2, as amended, agreed to.
Clause 3 [Persons qualified to be owners of British ships]:
Lord Gray of Contin Lord Gray of Contin had given notice of his intention to move Amendment No. 4:
Page 2, line 38, leave out ("and").
The noble Lord said: There is, I understand, the intention to take a fairly large group of amendments together here and we are to discuss Amendments Nos. 4 to 8, 10 to 13, 20 to 23, 25, 29 to 36 and 106. In view of this and the fact that my noble friend Lord Mottistone was to have moved the first of those amendments, Amendment No. 4, but is unfortunately unable to be with us at this stage, though he will be joining us later in the proceedings, I have undertaken to move this amendment on his behalf.
Since then, however, I have been advised by the General Council of British Shipping that it is now satisfied with the amendments in this grouping tabled by my noble friend the Minister, and therefore I do

541
not propose to waste the time of the Committee in either speaking to or moving this amendment. It might be to the advantage of all of us if we heard the Minister describe in rather more detail what he has on offer so that your Lordships' Committee can make its own decision.
[Amendment No. 4 not moved.]
[Amendment No. 5 not moved.]
Lord Brabazon of Tara Lord Brabazon of Tara: moved Amendment No. 6:
Page 3, line 6, at end insert—
("(4) It is hereby declared that a person who is not qualified under subsection (1) above to be an owner of a British ship may nevertheless be one of the owners of such a ship if—

(a) a majority interest in the ship (within the meaning of section 4 below) is owned by persons who are qualified to be owners of British ships; and

(b) the ship is registered, in accordance with the provisions of that section, under Part I of the 1894 Act.").

The noble Lord said: At the same time I shall speak to a rather large group of amendments. They are Amendments Nos. 6 to 8, 10 to 13, 20 to 23, 25, 29 to 36 and 106. I am grateful to my noble friend Lord Gray of Contin for his remarks about the need for these amendments and about the fact that the General Council of British Shipping is satisfied that its wishes are met by the Government's amendments. But I should now like to give a little bit of background to the Committee on what all this is about.
I referred in my Second Reading speech to the importance of foreign investment in the British shipping industry. The standard route for that is for a foreign or Commonwealth company to establish a subsidiary here which is entitled to place ships on the United Kingdom register. That route will continue to be open under the Bill, and we welcome the investment and employment which it brings.
But the 1894 Act affords another route for foreign investment from certain countries. These amendments are designed to offer a modern counterpart to that second route, consistent with our concern to secure more effective jurisdiction over UK registered ships. The 1894 Act provides that a ship is entitled to be registered if wholly owned by qualified individuals or companies. But the Act counts as "qualified persons" not only British citizens and companies but also Commonwealth citizens and companies. This means that a Commonwealth company can place a vessel directly on the UK register without having to establish a subsidiary here. It also means that a Commonwealth company and a UK company can jointly own a ship on the UK register, each owning some of the 64 shares in the vessel.
The Bill as drafted puts an end to those arrangements, giving a much more restricted definition of "qualified persons" and limiting it to UK and dependent territory citizens and companies. These amendments, however, would temper that restriction. They do so by removing the requirement for a ship to be wholly owned by qualified persons, and providing for non-qualified persons (for example, Commonwealth or EC citizens or companies) to own a minority of shares in a UK registered ship provided that a majority of shares in the ship—that is, at least 33 shares out of 64—are
542
owned by qualified persons and that our jurisdictional concerns are therefore secured. I might add that a similar provision is to be found in the Australian Ship Registration Act of 1981, which replaced the 1894 Act in Australia.
It is a truism to say that shipping is an international activity. Joint ventures with shipping companies of other countries are an increasingly important aspect of it. It is important to maintain the maximum flexibility in organising such arrangements, consistent with satisfying our jurisdictional concerns, so that there is no disincentive to such joint ventures utilising ships on the UK or dependent territory registers. I hope the Committee will agree to these amendments. I beg to move.
Lord Underhill: In accordance with the views of the noble Lord, Lord Gray of Contin, we likewise are prepared to support the government amendments. They provide for a majority holding, which is what all of us would prefer. Although there is a vast group of amendments we give them general support. At this stage I wish to thank the noble Lord for carrying out his undertaking to let us have Notes on Clauses much earlier than he thought would be the case, and also for his notes today explaining the new measures.
On Question, amendment agreed to.
Clause 3, as amended, agreed to.
Clause 4 [Entitlement to registration under Part I of 1984 Act]:
[Amendment No. 7 not moved.]
Lord Brabazon of Tara Lord Brabazon of Tara moved Amendment No. 8:
Page 3, line 12, leave out ("wholly") and insert ("a majority interest in the ship is").
The noble Lord said: I have just spoken to this amendment. Therefore, I beg to move.
On Question, amendment agreed to.
Lord Underhill Lord Underhill moved Amendment No. 9:
Page 3, line 13, at end insert—
("( ) It shall be a condition of entitlement to registration that persons employed on such a ship shall be citizens of the United Kingdom.").
The noble Lord said: It is argued that the removal of the obligation of registration under the 1894 Act and its replacement by an entitlement, as is proposed under the Bill, is helpful to the shipping industry. It is clear that this gives the shipping industry essential flexibility enabling owners to transfer ships from one register to another as circumstances arise.
If the obligation to register is removed will that not make it easier for ships to be registered outside the UK, and is there any advantage in making that provision? In any event, registration under either the present system or the proposed new arrangement does not carry any obligation whatever to employ United Kingdom nationals. The point of the amendment is that it shall be a condition of entitlement to registration that persons employed on such a ship shall be citizens of the United Kingdom. I beg to move.
Lord Brabazon of Tara: I am afraid that I cannot accept this amendment, because it ignores the basic

543
realities of the industry and would impose a crippling increase in the operating costs of UK registered ships. Current law imposes nationality requirements on the master, mate and first engineer of UK registered ships. It is true that some other countries have more stringent nationality requirements, but many of them are now finding these requirements so expensive that they are seeking to circumvent them by establishing offshore registers. Our shipping industry has a long tradition of employing non-UK seafarers. The amendment gives no recognition, for example, to the part which Irish citizens play in manning our ships.
We are seeking to encourage companies to use crews resident in the British Isles through the financial assistance measures in Clause 26. I believe that that is the right way to approach the matter, but to require every single employee to be a UK citizen would raise costs very significantly. I can think of no surer way to drive tonnage away from the United Kingdom flag. I think this amendment would be extremely counter-productive as regards the numbers of ships on the UK register. I hope that the noble Lord will not wish to press it.
Lord Greenway: Would the Minister not agree that perhaps the real problem here and the crux of the matter against the amendment is that we are not training enough seamen at the moment and that we cannot find enough people to man our ships? Companies are often forced to seek employees from other countries in order to fill their ships.
Lord Brabazon of Tara: Obviously we shall come a little later in the course of the Bill to what we propose to do to assist shipping companies with training. As I said in my opening remarks, I hope that will encourage British shipowners to use British seafarers. So indeed should the measures that we shall come to later as regards repatriation costs. But even with those measures there has been a long tradition in certain shipping companies to employ foreign seafarers. I think particularly of cruise ships and passenger ships where many of the stewards are Indian and have always been Indian, so far as I know. If we sought to stop that happening those companies would very likely flag out.
Lord Underhill: I have listened carefully to what the Minister said. We want to have some benefit to the British seafarers in any registration proposals. The best course to adopt is to read very carefully what the Minister said. In the meantime, I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Lord Brabazon of Tara Lord Brabazon of Tara moved Amendments Nos. 10 to 13:
Page 3, line 18, after ("whom") insert ("the majority interest in").
Page 3, line 22, leave out ("a ship is wholly") and insert ("a majority interest in a ship is").
Page 3, line 31, leave out ("a ship is wholly") and insert ("a majority interest in a ship is").
Page 3, line 41, after ("section") insert—
("(a) one or more persons shall be treated as owning a majority interest in a ship if there is vested in that person or in those persons, taken together, the legal title to 33 or more of the 64 shares into which the property in the ship is divided, for the
544
purposes of registration, in accordance with section 5 of the 1894 Act (there being left out of account for this purpose any share in which any beneficial interest is owned by a person who is not qualified to be an owner of a British ship); and
(b)").
The noble Lord said: I spoke to Amendments Nos. 10 to 13 with Amendment No. 6. With the leave of the Committee, I shall move them en bloc.
On Question, amendments agreed to.
3.30 p.m.
Lord Gray of Contin Lord Gray of Contin moved Amendment No. 14:
Page 3, line 43, at end insert—
("(7) The Secretary of State may by regulation specify further requirements which must be satisfied in order for a ship to be eligible to be registered as a British ship, provided that ship was a specific type of ship. Such requirements may be—

(a) requirements in connection with the implementation of subsections (2) to (5) or

(b) in addition to the requirements so specified,

and appearing to the Secretary of State to be appropriate for securing that such a vessel has a genuine and substantial connection with the United Kingdom.").
The noble Lord said: Once again, this amendment is grouped with Amendments Nos. 17 and 19. With regard to Amendment No. 19, I wish to advise the Committee that it would not be my intention to move that amendment when we reach it because I have been advised that the drafting leaves a good deal to be desired. For that, I make due apology to the Committee. I propose not to move it but to look at it again, take further advice on the drafting and hopefully retable it on Report.
It may be that since it is grouped with Amendment No. 14 certain Members of the Committee may wish to comment on it. I should welcome that. but I should rather not move it at this stage.
The purpose of Amendment No. 14 is to provide the Secretary of State with powers to introduce restrictions on the registration of ships of a specific type or types where it may be thought appropriate to ensure that the British share of the beneficial ownership is of an appropriate size.
As those Members of the Committee who were present on the occasion of the Second Reading of this Bill will realise, it has been for a considerable time my great concern that British flag ships are being deprived of a great deal of business which in my view is their just right in the British sector of the North Sea. That has caused great irritation to the companies who operate there. They are irritated by the fact that there is such easy access in the British sector of the North Sea to flags of foreign countries, particularly Norwegian and American, which operate in our sector freely and supply the rigs and platforms which have been placed there.
This amendment is a modest and moderate one. It is of such a nature that I hope that my noble friend, who has been so helpful and co-operative up until now, will between now and Report think about what I have said and what I am going to say and perhaps be able to do something about it. The British share of the beneficial ownership is something which gives cause for concern. There might be appropriate ways of putting that right.
Many reasons could be given for such action. Perhaps I may mention just three at this stage. The

545
first is that there may be grounds for suspecting what might be described as a "brass plate" type of registration, possibly of a short-term nature and therefore having no lasting benefit for the United Kingdom. There might also be a case in which the competitive sutuation is patently unequal. Finally, there might be a situation in which comparable restrictions are imposed on British companies or ships seeking registration abroad.
I asked at Second Reading what chance British vessels would have for trade if they were to try to encroach into the Gulf of Mexico, for example? There would be little sympathy or support for them. It is time we tried to take steps to protect our own vessels in our own waters.
The last three lines of the amendment are intended to ensure that no doubt exists about the ability to register a ship owned by any of the existing companies ultimately controlled from overseas which have already demonstrated a continuing commitment to the United Kingdom. As regards the British Offshore Supply Vessels Association, the amendment has the specific support of its members in that category. For example, Maersk, TNT and Zapata Gulf Marine have all been established in the United Kingdom for some years. They are part of the British shipping scene. All are aware of the amendment and are satisfied with it.
The amendment also has the support of the General Council of British Shipping. It will be noted—I am sure my noble friend has already done so—that the Secretary of State is not specifically required to act by the terms of the amendment. It is an enabling amendment and I shall be glad to hear what my noble friend has to say concerning it. I beg to move.
Lord Mottistone: I should like to support my noble friend. He has said all that needs to be said concerning the matter. I should like to take this opportunity to thank him for moving our joint amendments earlier and to thank my noble friend the Minister for his Amendment No. 6 which has enabled us to proceed with such speed. I do not suppose that it will be quite as good in the future.
Lord Carmichael of Kelvingrove: I should also like to support the amendment. Knowing the great experience of the noble Lord, Lord Gray, he is more aware than any of us of the feeling that we are always being left behind by unequal competition. He made the telling point that laissez-faire would not work if we sent ships to the Gulf of Mexico. This side of the Committee agrees with the General Council of British Shipping and the noble Lord, Lord Gray, that there is a strong case for the amendment. I hope that we shall have a comprehensive answer from the Minister.
Lord Geddes: In strongly supporting my noble friend who has moved the amendment, may I first apologise to the Committee that I was not in my place for the Second Reading of the Bill. Regrettably, I was out of the country at the time.
My noble friend Lord Gray has already mentioned the four specific companies which are long established on the British shipping scene but are not
546
ultimately British owned. I must declare my interest in that I am a director of one of those companies and the chairman of its subsidiary which is the second of those companies.
Dealing with the larger of those companies in physical size, the company has been established in the United Kingdom since 1973. It employs in excess of 6,000 people. It is a major employer and growing with great speed within the United Kingdom. It seems to BOSVA and the General Council of British Shipping that it would be unjust to exclude such genuine British companies, even though they are subsidiaries of overseas companies. The same point applies to Maersk and to Zapata.
Perhaps I may also refer to Amendment No. 19. I am grateful to my noble friend Lord Gray for stating in advance that he does not intend to move that amendment. One reason may be that the drafting is deficient. With great respect, it is contradictory. If one takes the last three lines of Amendment No. 14 which is under discussion at the moment, as my noble friend has rightly pointed out it is intended to bring within the net those companies that have a genuine and long-standing British presence. If one then looks at Amendment No. 19, paragraph (c) as drafted is in contradiction to paragraph (d). I am not a parliamentary draftsman and I do not have the correct wording. However, the intention at Report stage would be to bring the two paragraphs together so that they read along the lines of paragraph (c) as it presently stands. However, the paragraph would then continue, as regards the grounds under which the Secretary of State might decline to register:
"to the absence of reciprocal trading opportunities for British ships of a similar type in the country of ultimate beneficial ownership of the ship unless there was a genuine and substantial connection with the United Kingdom, the vessel being of a specified type".
If the amendment was drafted in that way, it would tie in closely with the wording and spirit of Amendment No. 14. I strongly support the amendment.
Earl Attlee: I support the amendment so succinctly moved by the noble Lord, Lord Gray of Contin. We must have reciprocity. Why should we allow everyone to come and take money on our section of the North Sea when our ships are specifically excluded from other sections of the North Sea? We must be fair about it. It is all very well for this country to say that we are a democracy, that we are open handed and that we allow everyone to come in and get money from our section of the North Sea when we are not allowed to get money back from other parts of the North Sea.
Lord Greenway: I should like to support the amendment. However, I think we must appreciate that the offshore industry is suffering, like so many other sectors of the shipping industry, from overtonnaging. That is perhaps partly to blame for the present situation.
On the other hand, I feel that the amendment addresses an anomaly regarding the countries that have had UK offshoots for a number of years. There might have been a problem in that regard and I think that the amendment overcomes it. So far as I am aware, two of the companies deal exclusively in

547
offshore ships. The Maersk company is rather larger and has a number of bigger ships on the UK register as well. I do not think that that would be affected in any way. However, I should like to add my support for the amendment which has been put forward.
Lord Parry: The amendment is directed basically towards offshore rigs and vessels of that sort. The final line of the amendment, which specifies that such vessels should have a general and substantial connection with the United Kingdom, is one that appeals to me and one to which I shall be referring later in the context of the fishing industry off the Welsh coast. Therefore, I seek support in the Committee for that general contention.
Lord Brabazon of Tara: As my noble friend has explained, the purpose of Amendment No. 14 with which we are dealing is to make our registration policy more restrictive in certain areas than it is at present. It is true, as the noble Lord, Lord Parry, has said, that we are doing just that for fishing vessels. However, we do it against the background of the EC common fisheries policy which allocates a national quota to us and which we are safeguarding for UK fishermen. The amendment puts severe limitations on any foreign investment in the fishing industry.
We should think long and hard before changing our requirements for registration of merchant ships in this way. We have traditionally welcomed foreign investment in our merchant marine and the employment which it brings. Indeed my noble friend and my noble friend Lord Geddes have talked about the number of companies with foreign parents which are prominent in the offshore sector. My noble friend has said he has no wish to penalise them. Establishing requirements for a genuine and substantial connection with the UK that will not also risk excluding desirable foreign investment will not be easy; and the position of ships already on the register which did not meet any new requirements would need to be considered.
Nevertheless I have a good deal of sympathy with my noble friend and others who have spoken to this amendment. Indeed it is not difficult to gauge the feelings in the House either this afternoon. I am prepared, without commitment, to consider this proposal and to return to the matter at the next stage. I would obviously like to talk to my noble friend between then and now.
I turn briefly to Amendment No. 19, which, as my noble friend said, is an enabling amendment. This does not specifically require the Secretary of State to act. The grounds for refusing registration set out in the Bill are safety of the ship, the risk of pollution and the safety of crew members. This amendment introduces a new class of consideration, reciprocity and connection with the UK.
The issue of reciprocity raises great complications. It would move away from the present system where a ship is eligible to register if clear criteria are satisfied. It would require an investigation of beneficial ownership; an investigation of the policies of the country or countries where ultimate beneficial ownership lies; and a judgment about the balance of trading opportunities.
548
I need hardly remind my noble friend that the country which perhaps he is most wanting to get at would actually claim that it had reciprocal trading opportunities with us. I have been to visit it and met its minister twice to talk about this. In any case it is definitely that country's claim that its coast is open.
These are important questions, but the registration process is not the place to deal with them. We have powers to deal with foreign actions affecting shipping under Section 14 of the 1974 Act and we shall be improving them under Clause 36 of this Bill. As for a genuine and substantial connection with the UK, I have agreed with my noble friend that we will look at this very carefully and so there will be no need to add it in the second amendment which he proposes.
With those words I hope that my noble friend will withdraw the amendment at this stage. We will talk about it at Report stage if not before.
Lord Gray of Contin: I am most grateful to my noble friend for continuing his sympathetic approach to the Bill. I fully accept that he will take this away without commitment. It would be unfair to expect him to do otherwise at this stage. I shall certainly be available to talk with him at any time. I hope that between now and Report stage he will be able to frame an amendment which would be acceptable and indeed that the amendment might be put down by the Government. I seek leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Lord Beaverbrook: I think this would be a convenient moment to take the Statement. I beg to move that the House do now resume.
Moved accordingly, and, on Question, Motion agreed to.
House resumed.

BR Engineering Limited: Future
3.44 p.m.
Viscount Davidson: My Lords, with the leave of the House, I shall now repeat a Statement about the future of British Rail Engineering Ltd., which has been made in another place by my right honourable friend the Secretary of State for Transport.
The Statement is as follows:
"As the House knows, British Rail Engineering Ltd. is one of the main suppliers of railway rolling stock to British Rail. It is also a wholly-owned subsidiary of BR.
"BREL has been extensively reorganised in the last few years. These changes have stemmed largely from the modernisation of BR's locomotive and rolling stock fleets, which has reduced substantially the need for repairs. BREL now consists of four main works—Crewe, York and two at Derby—and concentrates on manufacture and heavy overhaul.
"The Railways Board has now completed its review of options for the future of BREL. Sir Robert Reid has recommended to me that BREL should be offered for sale as soon as possible. I

549
have now given my approval to this. I share the board's view that selling BREL will be in the best interests of the railway and of the BREL workforce.
"The board plans to invite offers for all four main works together as a single business. The aim is to be ready to invite offers by next spring and to complete the sale as soon as possible after that.
"The Railways Board and its merchant bank advisers will be in the lead in developing plans for the sale. My approval will be needed for the eventual sale.
"The board proposes making separate arrangements for the sale of the BREL foundry at Horwich. The aim would be to find a buyer to take it over as a going concern, probably some time next year.
"Great strides have been made by the BREL management and workforce towards commercial viability and competitive levels of productivity. But I believe that the business can best develop and flourish in the private sector. There it will also have much greater freedom to diversify and compete for work outside the railway supply industry and, I hope, to create new employment opportunities.
"Privatising BREL will be good for the railway, good for the railway supply industry and good for BREL itself. I hope therefore that the House will welcome it."
My Lords, that concludes the Statement.
Lord Underhill: My Lords, the only thing that I can say that is satisfactory is to thank the noble Viscount for repeating the Statement. The concluding paragraph that privatisation is:
"good for the railway, good for the railway supply industry and for BREL itself",
and that the Secretary of State hopes that the House will welcome it, is far from the reaction which I and my noble friends behind me have.
At the moment BREL is in a state of confusion. I think the workforce is in a state of dejection. When we look back to 1979 the workforce numbered 36,000. It was envisaged that there would be expansion to 43,000 by the end of 1984. Since then we have had five separate announcements of redundancies. Currently the workforce is down to 10,000 and the last statement means that it will be down to 7,500 by April 1988.
These statements of redundancies have from time to time also been accompanied by the closure of various works, in some cases almost devastating the local communities. Every single announcement of redundancy has been met by a promise that this is for the betterment of BREL and the workforce. That must be far from the truth.
The Serpell Report of 1983 recommended privatisation of BREL and even recommended that British Railways should go to private manufacture. In October 1983 the then Secretary of State, Mr. Nicholas Ridley, instructed BR to examine the possibility of the privatisation of BREL.
We have had reorganisation and, as stated in answer to a Question on 9th November in this House, BREL was not allowed to tender for the sprinter class
550
but only to be treated as a possible major subcontractor.
Why has it been suggested that the Horwich foundry should be kept separate from the sale? It is obvious from the history of events that there has been a deliberate intention eventually to privatise BREL following the Government's dogma and doctrine in this matter, irrespective of the particular industry.
The rundown has meant now that there is land available. Therefore are we to see a period of asset stripping when the sale has taken place? The rundown will also mean that a price can be obtained now for the sale which will be much lower than would have been the case when BREL was a thriving industry and the workforce looking forward to progressive improvement. What will happen to all the first class technical experience that has existed in BREL and also the opportunities for exports which BREL brought to us? This is a disappointing Statement—in fact, a dreadful Statement—which we on this side of the House deeply deplore.
Lord Tordoff: My Lords, the view from these Benches is couched neither in the triumphal terms of the final paragraph of the Statement nor is it the dogmatic response heard from the Labour Front Bench. The attitude that, on the one hand, all privatisation is good is just as foolish as the statement that all privatisation is bad. If noble Lords wish to hear a further development on that subject they might care to listen to the debate to be opened tomorrow by my noble friend Lord Ezra.
With regard to the specific case of BREL, one really is suspicious that the Government are shuffling off their responsibilities. We have a time of enormous over-capacity in the industry. We have national assets being sold off at a time when the stock market is in decline. Can the Government really believe that the price they achieve on the open market is likely to be a fair and reasonable one, or are they simply handing the whole thing over to asset strippers?
There is undoubtedly a lot of real estate involved which must have some significance, but at another time. As the noble Lord, Lord Underhill, said, it might have been much easier to obtain a better price at an earlier time. I suspect that if they were to wait for some time it might be easier to get a better price than if they insist on selling it off now. With business coming from the Channel Tunnel in a few years' time the industry is likely to be in a better position.
One has to consider the people involved in the industry. I do not pretend that in an industry with this sort of over-capacity jobs can be preserved for ever. That is a foolish attitude; in the long term it does not do the industry, the country or employees any good. It seems to me that as in the case of the dockyards, the Government are in danger of shuffling off on to private industry the responsibility for redundancies which may in any case have to take place. Noble Lords will remember that for the dockyards promises were given about jobs but broken six months later by the new owners.
The only other question I ask the noble Lord is whether the Government expect an employee bid for the assets. Will they give favourable consideration to that? It is sad that an organisation such as this, which

551
has contributed so much to engineering in this country, finds itself in the state in which it is today. However, I believe it is foolish to deny that that is the position. I do not believe that dogmatic statements about keeping it in public hands or putting it into private hands will solve the problem. That will only be solved by better management than it has had in the past. If that can be achieved, then there may be some success in the future.
Viscount Davidson: My Lords, I am grateful to the noble Lord, Lord Underhill, for his thanks to me for repeating the Statement and to the noble Lord, Lord Tordoff, for his general and liberal reception of it. The reaction of the noble Lord, Lord Underhill, was not unexpected. I do not believe that the Statement came as a complete surprise to him. It is clear that we shall have to agree to disagree.
Without embarking on a political debate, I should tell the House that BR's main business is running the railway and not running an engineering business. Facilities needed for day-to-day maintenance are already separated into BR Maintenance Limited and will remain in BR control. Privatising BREL will help BR develop fully its policy of competitive tendering and the benefits that that brings to the railway and to its customers. BR's view is that its best interests are served by competition. There will always be problems with this while it tries also to manage an in-house capability.
Much work has been done on restructuring the business. Now there are clear prospects of viability and BREL is confident about its future. The sooner the question of ownership is resolved the better. Private ownership will open up new opportunities for the company.
On the question of redundancies, these have been mainly due to the fall in the repair and maintenance workload as a result of investment in modern rolling stock. Necessary changes have been made irrespective of future ownership. Redundancies have nothing to do with privatisation. BREL hopes to establish alternative employment schemes in the areas affected. It has opened discussions with local authorities and is willing to consider appropriate proposals. BREL has had good success in creating jobs in areas affected by previous job losses.
The noble Lord, Lord Underhill, asked why it is proposed to sell Horwick separately. I understand that Horwick—
Lord Tordoff: My Lords, I think the word the noble Viscount is looking for is Horwich.
Viscount Davidson: My Lords, when I asked at my briefing where Horwich was, I thought it might be halfway between Norwich and Harwich. I completed my briefing and found it to be not far from where the noble Lord, Lord Tordoff, was born. My briefing was successful on that point.
Horwich is a specialist foundry facility. It is outside the mainstream business of rolling stock manufacture and heavy overhaul. BR and its advisers think it can be best marketed separately. People interested in
552
Horwich might well not want to purchase BREL as a whole.
The noble Lord, Lord Tordoff, asked who might buy. Certainly it is open to the staff to seek financial backing for a buy-out if they wish and I hope they will do so; otherwise, the involvement of the workforce would be a matter for the new owners. No doubt the present management will be interested in making offers. I believe that is as far as I can go.
Lord Boyd-Carpenter: My Lords, is my noble friend aware that those of us who listened to the gloomy account by the noble Lord, Lord Underhill, of what has happened to this organisation under public ownership over the past few years were a little surprised to hear his conclusion that it is bad to bring that state of affairs to an end and to give this organisation a new chance.
Is he also aware that experience of the other industries which have been privatised in recent years is an immensely encouraging one and offers an encouraging prospect—
Lord Stoddart of Swindon: Including the Post Office?
Lord Boyd-Carpenter: We have not denationalised the Post Office. The noble Lord opposite thinks we have denationalised the Post Office and in view of the way the Post Office is run at the moment, I must resent that.
Is my noble friend aware that there is an encouraging picture of privatised industries which have grown, flourished and increased the employment they offer? That gives one every reason to hope that the same will be true for this organisation. We wish it the best of luck under its new ownership.
Viscount Davidson: My Lords, I am most grateful to my noble friend. Of course, I agree with everything he said. I do not feel however that it is my job now to anticipate tomorrow's major debate.
Lord Dean of Beswick: My Lords, we are grateful to the Minister for repeating the Statement, and for the information he has given. Is he not aware, however, that some of us believe that such a major decision requires a debate? There are more issues involved than can be fairly dealt with during a Statement? However, I wish the noble Lord, Lord Boyd-Carpenter, would read some copies of Hansard before he starts passing opinions on this type of issue in this House.
The noble Lord began by indicating BREL's lack of success. I should like to quote from the Secretary of State for Transport's reply last week in a debate on this very subject. He said:
"Since BR began placing new build orders competitively BREL has done very well. It has obtained around 70 per cent. of the orders".
I suggest that any company, in competition with other businesses, which is 70 per cent. successful with its tenders had done very well indeed. I believe that is why BREL is being flogged off. I am rather surprised at the sentiments and the way that the Minister dealt

553
with this in another place when he said in the same debate:
"Earlier I announced the order worth nearly £69 million, for Super Sprinters and I can now say that that order will go to BREL. There are bright prospects for the BR supply industry and for BREL's future within it."—[Official Report, Commons, 17/11/87; col. 939.]
I suggest, on the basis of that statement made only seven days ago, that that senior Minister might well be accused by many people of misleading Members in another place when, within a week, he puts forward the proposals contained in the Statement. I speak as an engineer, and I do not find any justification in the Statement for such action. My view is that the action is taken out of political spleen. I cannot see it doing anything for those mainly involved—the rump of the workforce—who have proved that they can cooperate, given the chance to do so. It will mean once again that many more people in those areas will find their way to the dole queues.
Viscount Davidson: My Lords, I said that I did not want to anticipate tomorrow's debate. As this is a Statement, I do not think we should continue the discussion any further.
Lord Stoddart of Swindon: My Lords, I shall speak as a former representative of Swindon. Does the noble Viscount agree that Brunel might have taken issue with his statement that engineering has no place in running a railway? That is what the noble Viscount said. Will he inform the House how the British Rail Board will be able to have the engineering capacity to ensure that its locomotives and rolling stock are satisfactory for its operations?
Viscount Davidson: My Lords, I did not say what the noble Lord thinks I said. I said that BR's main business is running a railway, not running an engineering business. The facilities needed for day-to-day maintenance are already separated into BR (Maintenance) Limited, and will remain in BR control. I think that that answers his question.
Lord Campbell of Croy: My Lords, is my noble friend aware that my wife is the great-great-grandaughter of I. K. Brunel, that engineering certainly brought the railways into existence, but that if he were alive today he would be in space?
Viscount Davidson: My Lords, I note my noble friend's comments.

Merchant Shipping Bill [H.L.]
4.2 p.m.
House again in Committee on Clause 4.
On Question, Whether Clause 4, as amended, shall stand part of the Bill?
Viscount Simon: I wish to ask one question to clarify my mind. I find the clause difficult to follow. Under Clause 3, we see that among the persons who can be owners of British ships are:
"bodies corporate incorporated in the United Kingdom".
554
If a body corporate incorporated in the United Kingdom is owned completely by foreigners, as it may be, are its ships still entitled to be registered as British ships?
Lord Brabazon of Tara: Yes. Provided that the company is incorporated in the United Kingdom it does not matter who owns the shares in that company. The ships are eligible to be registered here.
Clause 4, as amended, agreed to.
Clause 5 [Representative persons]:
Lord Underhill Lord Underhill moved Amendment No. 15:
Page 4, line 20, leave out ("an individual") and insert ("a British citizen").
This noble Lord said: This is a small amendment, but it is of some importance. Clause 5 deals with the appointment of representative persons in relation to the ship, where the ship is owned by persons not resident or established in the United Kingdom. Subsection (2)(a) provides that,
"the representative person is either—

(i) an individual resident in the United Kingdom, or

(ii) a body corporate incorporated in the United Kingdom".

The amendment seeks to lay down under subsection (2)(a) that the representative person should not be an individual merely resident in the United Kingdom. The additional wording is important, and I hope that the Government will accept it. I beg to move.
Lord Mottistone: In practice, most people who are likely to be representative persons will be British citizens or companies incorporated in the United Kingdom, and having their principal place of business here. However, there may be individuals resident in the United Kingdom who are foreign nationals anxious to be in a position to be representative persons. The amendment would introduce an unnecessary degree of inflexibility.
Lord Brabazon of Tara: I am grateful to my noble friend for his remarks because I am not going to be able to deal with the proposal in all that friendly a manner. The amendment imposes an unnecessary requirement. As I said on Second Reading, the representative person is not responsible for the owner's acts or omissions, but provides a means whereby legal documents can be served on the owner. If the owner fails to respond, then certain consequences, including removal from the register, can flow. What matters for the service of documents is that the individual or company appointed should be resident in the United Kingdom. Subsection (2)(a) provides for that.
I fail to see why the nationality of the representative person is material, provided that he is resident in this country and can have legal documents served upon him. I hope therefore that the noble Lord will see that it is not necessary for such a person to be a British citizen and will feel able to withdraw the amendment.
Lord Underhill: I am obviously going to have no sympathy from the Government on this matter. From his first sentence, I thought that the noble Lord, Lord Mottistone, was going to agree with me. Despite what the Minister says, I still think that there is something in our suggestion. It is not the type of issue upon which to divide the Committee. I shall look carefully at the Minister's words to see whether we shall return with the proposal in some form on Report. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Lord Underhill Lord Underhill moved Amendment No. 16:
Page 4, line 25, at end insert ("and such regulations shall not be made unless a draft of them has been laid before Parliament and approved by resolution of each House.").
The noble Lord said: Amendment No. 15 dealt with representative persons. Subsection (2) explains the requirements in connection with the appointment of a representative person. However, sub-paragraph (b) provides,
"such other requirements as the Secretary of State may by regulations prescribe".
That is an important provision that should not be left merely to the negative procedure of the annulment of any order that may be tabled by the Secretary of State should he wish to prescribe other requirements. It is an important issue because other requirements for the representative person could be laid down. The purpose of the amendment is to ensure that that is done by affirmative resolution of both Houses of Parliament. I beg to move.
Lord Brabazon of Tara: Under Clause 47 any regulations made under the Bill, including those relating to representative persons in this clause, are placed before Parliament for approval under the negative resolution procedure. The amendment would require regulations made under this clause to be subject to affirmative resolution. The regulations deal with the technical details of the requirements for a representative person for ships owned by qualified persons not resident in the United Kingdom.
I am not convinced that all regulations on those details would necessarily warrant taking up time in debate in both Houses. I hope that the Committee will agree that we have struck the right balance by providing for the negative resolution procedure, thereby ensuring parliamentary scrutiny and giving the opportunity for debate if necessary, while avoiding unnecessary demands upon parliamentary time.
I have no doubt that many of us have found ourselves debating affirmative resolution orders in the dinner hour and that some of us have wondered why the orders were made subject to affirmative resolution in the legislation. I should prefer to stick with what we have in the Bill at the moment. I hope that the noble Lord, Lord Underhill, will not feel so strongly about this matter that he will press it to a Division.
Lord Underhill: The noble Lord, Lord Underhill, certainly will not press the matter to a Division! The fact that the matter is technical is no reason for us not to have regulations by affirmative procedure. The
556
noble Lord said that we have listened to some boring debates in the dinner hour. Only a few of us listen to boring debates during the dinner hour; most other people never hear about them.
We do not know what the Minister may prescribe. He will be left with,
"such other requirements as the Secretary of State may by regulations prescribe".
In our view this is not a technical matter of no consequence. Although we shall not press it to a vote, I hope that the Minister will reconsider carefully what he has said because there are sound foundations for the course that we suggest. Merely because a later clause provides that regulations shall be by the procedure of annulment does not mean that we should not have this; and, indeed, there are some later amendments that we believe are equally important. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
On Question, Whether Clause 5 shall stand part of the Bill?
Lord Geddes: I should like to ask my noble friend the Minister what is in effect a supplementary to the question asked by the noble Viscount, Lord Simon on Clause 4 stand part. The same point arises under Clause 5(2)(a)(ii) in regard to,
"a body corporate incorporated in the United Kingdom and having its principal place of business there".
To take the example that the noble Viscount gave, if the subsidiary of an overseas entity is itself a body incorporated in the United Kingdom, is it that subsidiary which has its principal place of business in the United Kingdom or is it the parent of the subsidiary?
Lord Brabazon of Tara: It is the subsidiary which has its principal place of business in the United Kingdom. There are many examples of shipping companies into which category would fall a company such as that represented by my noble friend.
Clause 5 agreed to.
Clause 6 [Refusal of registration]:
[Amendment No. 17 not moved.]
4.15 p.m.
Lord Carmichael of Kelvingrove Lord Carmichael of Kelvingrove moved Amendment No. 18:
Page 6, line 2, at end insert ("; or
(c) to the national interest,").
The noble Lord said: This may seem a superflous amendment. It is to add to the already long list of provisions under which the Minister may refuse registration the provision to pay attention to or to take into consideration the national interest; or the Minister may merely state that it is against the national interest to include a particular ship on the register.
At a practical level it is necessary for countries to be able to enforce their laws and to exercise jurisdiction over ships in accordance with the 1958 convention on the high seas. This is all the more important since a substantial body of international

557
law has gradually developed to regulate the safety of ships, the prevention of pollution and the training and welfare of seafarers. These international conventions place onerous duties on flag states that have adopted them. The United Kingdom is a party to all these conventions. It is therefore of paramount importance that regulations can be applied and enforced effectively on all ships registered in the United Kingdom and dependent territories.
The main corpus of the amendment is to make the Minister think twice before an automatic reflagging of ships. There is still a great deal of disquiet as to what happens. It may well be in the longer term national interest when suddenly Kuwaiti ships almost overnight have the British flag. As I understand it from reading the background information, this implies an adherence to all the conventions. Immediately there is a reflagging this gives protection under and adherence to the maritime conventions. The Minister should have the power to say that a particular ship may satisfy all kinds of conditions but something is not quite right about it and in the national interest it would be wrong to reflag the ship. I beg to move.
Lord Brabazon of Tara: I do not believe that it would be helpful to introduce this wide element of discretion into the registration process. Under the present law and under the Bill as introduced a ship is entitled to be registered if it meets the statutory criteria which are clearly laid down. The grounds on which registration may be refused under the Bill are equally clear. They are: failure to meet the eligibility requirements, the condition of the ship in so far as is relevant to its safety or to any risk of pollution, and the safety, health and welfare of persons employed on board. These requirements are important and specific. To these the amendment would add a consideration that is very broad and quite different in character: the national interest.
The amendment offers no guidance as to how the discretion might be used. It would apparently give Ministers the right to move the goal posts at a late stage in the game and to say to people who have met all the statutory requirements making them eligible to register: "Sorry, you have met all the rules, you are fully eligible to register as a British ship, but I have decided to invoke the national interest to stop you registering". That would put Ministers in a very difficult position. On the other hand, they will be beset by lobbies and special interests and asked to use their discretion to refuse registration in particular cases. They may be asked to do so in conditions of considerable political sensitivity. If they decide to use that discretion, they will be removing rights from people who met all the requirements that the statute lays down, and no doubt there would be legal challenges as to whether the Minister had used his discretion reasonably. All this risks subtly changing our registration process from one which is sensibly administered according to statutory criteria and where people know where they stand, to one which is clouded with uncertainty and introduces a political element into the process.
The noble Lord, Lord Carmichael of Kelvingrove, referred to the events over the summer in the Gulf. In
558
the past some very alarmist things have been said about that. I should like to make one or two comments to set matters in perspective. First, there has been a long history of foreign investment in the British merchant fleet, which we welcome. Noble Lords referred to it earlier in Committee. One thinks, for example, of Canadian Pacific and Esso tankers. These well-known names are ultimately owned by foreign countries, but we welcome their investment in the United Kingdom flag and the employment and shore-based business that they bring. There are other perhaps less-well known names besides. We should think very carefully before speaking as if we think that foreign ownership of UK flag vessels is somehow a bad thing.
Secondly, it has been suggested that there has been a flood of tonnage to the UK register. I almost wish that there had. In recent months some half dozen vessels owned by interests in the Gulf have joined the United Kingdom and Gibraltar registers. That is all. That is hardly the stuff to justify a major change in direction for our registration policy. It has also been suggested that the present arrangements are piling obligations on the Royal Navy's Armilla patrol. It is simply not the case that entering a ship on the British register entitles it to summon up a Royal Navy gunboat at the drop of a hat. Protection is not an entitlement. No particular level of protection is guaranteed. The Armilla patrol provides a carefully defined presence in a limited area, not a close escort.
The amendment represents an exaggerated response to a point that received a great deal of publicity in the summer but which we can now study from a cooler perspective. I do not believe that it would be in the interests of our shipping register to introduce an ill-defined element of discretion which in practice represents an element of uncertainty. For all the reasons that I have given in rejecting the amendment, I hope that the noble Lord will he able to withdraw it.
Lord Mulley: I agree with the noble Lord the Minister that the amendment confers a wide discretion on Ministers. I do not think that that is necessarily a bad thing. I happen to believe that Ministers should exercise discretion in the national interest.
What disturbed me enormously was that the noble Lord was speaking of going outside the statutory requirements for registration. However, if we provide this in the Bill it is a statutory requirement.
The other very alarming remark he made was that some people might seek to go to the courts to question the Minister's discretion. I share his concern on this very recent doctrine of judicial review. We see what is happening in the National Health Service. If we are not careful we shall have lawyers who have no competence for anything except interpreting the law and dealing with one version of events as against the other deciding these matters. If the Government are worried about this, as the Minister indicates, I share that worry. I wish that they would do something about it and stop the courts having the power to go beyond statute. Where the statute gives the right of recourse to the courts, that is fair enough. But let us take the example of the tolls on the Severn Bridge.

559
The matter was challenged because a letter had been sent to the wrong person, and many people then claimed refunds. The Court of Appeal very sensibly said that this was nothing to do with the courts and threw the matter out. The authority then had to try to recover the money from the people to whom they had repaid it.
One cannot run the country if Ministers are afraid to take responsibilities in the national interest because they are afraid that somebody may sue them in the courts and question the exercise of their discretion. In this context the issue may be regarded as small, but it raises very substantial questions indeed.
Viscount Massereene and Ferrard: It is surely in the interests of Britain that ships owned by nationals of friendly powers should wish to be registered under the British flag. I understand that the largest ship in the world is now registered under the British flag.
Lord Carmichael of Kelvingrove: I am most grateful for the very apposite points that my noble friend Lord Mulley raised about the power of a Minister not being totally delineated in an Act but that he should have a general power to look at the national interest. We hope that the Minister will always do that.
I am interested in the Minister's suggestion that we are giving an opportunity for the goal posts to be moved and that after a person has satisfied all the statutory requirements the goal posts would suddenly be changed. If one looks at the requirements it does not seem as though they can be satisfied overnight, and the Minister would be well aware, long before the final application was made, that this move by the foreign shipowner to have his ship reflagged would not be in the national interest.
I am sure that nods and winks have been given before, or straightforward statements made, saying, "You are not going to be re-flagged no matter how many of the requirements you satisfy". The Minister stated that half a dozen vessels had joined our registers during the events in the Gulf over the summer. If there was little benefit, why did they change? If there was no extra protection from the British Navy, why did they change their flags? What were the reasons for their wishing to change the flag?
I do not think there has ever been an answer for the wider public outside. I have heard no indication in this Chamber as to why there was a sudden change other than the fact that they were given protection by the navy. However, that issue will probably be raised at a later point. I shall look at the point again. In the meantime, I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendment No. 19 not moved.]
Clause 6 agreed to.
Clause 7 agreed to.
Clause 8 [Offences relating to furnishing of information and duty to comply with directions]:
On Question, Whether Clause 8 shall stand part of the Bill?
Lord Underhill: I am seeking to obtain some information from the Minister. Clause 8 concerns offences relating to the furnishing of information and a duty to comply with directions. Sub-paragraphs (1)(i) and (ii) provide on summary conviction for a fine not exceeding the statutory maximum. The Notes on Clauses state that this is currently £2,000. Paragraph (ii) provides on conviction on indictment for a fine. The Notes on Clauses state that this is an unlimited fine. Should there not be some indication given in this clause of the scale of a fine on summary conviction and some limits of the fine on conviction on indictment? I confess that I have no legal knowledge on this matter but in other clauses we have information of a scale or a maximum. That is not so here, although the Notes on Clauses give us some information.
If I have asked a question to which the Minister cannot readily reply I shall understand. Perhaps he will write to me to confirm the position. We shall then know whether the clause should be amended.
Lord Brabazon of Tara: At the present time I can only confirm the figures which I have given and which the noble Lord has found in the Notes on Clauses. They are £2,000 on summary conviction and an unlimited fine on conviction on indictment. I am told that the Bill uses the normal drafting. However, I shall write to the noble Lord, Lord Underhill, and expand on that.
Clause 8 agreed to.
Clause 9 [Amendments of Part I of 1894 Act]:
Lord Brabazon of Tara Lord Brabazon of Tara moved Amendments Nos. 20 and 21:
Page 7, line 34, leave out ("and")
Page 7, line 37, at end insert—
("(c) references to a ship being entitled to be registered shall be construed in accordance with section 4 of this Act; and
(d) references to the ownership of a majority interest in a ship shall be construed in accordance with subsection (6)(a) of that section.").
The noble Lord said: I have spoken to Amendments Nos. 20 and 21 with Amendment No. 6. I beg to move the two amendments en bloc.
On Question, amendments agreed to.
Clause 9, as amended, agreed to.
Schedule 1 [Amendments of Part I of Merchant Shipping Act 1894]:
Lord Brabazon of Tara Lord Brabazon of Tara moved Amendments Nos. 22 and 23:
Page 44, line 25, leave out from ("(iii),") to end of line 27 and insert—
("(b) for paragraph (v) substitute—
"(v) A declaration that, to the best of his knowledge and belief, a majority interest in the ship is owned by persons qualified to be owners of British ships, and the ship is otherwise entitled to be registered."; and
(c) at the end add—
"In the application of this section to a ship which is not wholly owned by persons qualified to be owners of British ships, paragraph (i) above shall have effect only in relation to persons who are so qualified."").
Page 45, leave out lines 20 and 21 and insert—
("(i) for the words from "by reason" to "British ship" substitute "to be entitled to be registered (whether because a majority interest in the ship is no longer owned by persons qualified to be owners of British ships or for any other reason)",").
The noble Lord said: I have spoken to Amendments Nos. 22 and 23 with Amendment No. 6. I beg to move the two amendments together.
On Question, amendments agreed to.
Lord Underhill Lord Underhill moved Amendment No. 24:
Page 45, line 40, leave out paragraph 13.
The noble Lord said: This relates to Section 22 of the 1894 Act. It provides for the granting of a provisional certificate for a ship becoming British-owned although abroad. There are subsequent amendments that seek to alter the duration of a provisional registration. I do not want to become involved in those arguments at this stage. The Government suggest one duration, and I believe that the noble Lord, Lord Mottistone, is suggesting a change of that duration. I am suggesting another change. It is therefore best to leave those arguments until we reach the amendments.
We suggest that the present system should be abolished altogether by deleting this reference, because the system is open to abuse. If one refers to the consultative document which was issued in 1984, paragraph 34 states that, although the Government believe that there is a need to retain a provisional registration, the present system is open to abuse: first, because it enables an unsafe ship to sail under the British flag for six months—we shall come to the duration later on—without any survey; and, secondly, because this cheap and convenient method of acquiring British nationality for a ship abroad could be exploited for criminal purposes. Surely there could be no greater justification for suggesting that the provision for temporary registration should be removed altogether. That is what the amendment seeks to do. If it should not be agreed we could deal with the duration of the temporary registration later on. This amendment seeks to remove provisional registration. I beg to move.
The Deputy Chairman of Committees (Lord Alport): I have to advise the Committee that if this amendment is agreed to I shall not be able to call Amendments Nos. 25, 26, 27 or 28.
Lord Mottistone: It is most unfortunate that the noble Lord should seek to sweep away the whole of this paragraph. There are many occasions when provisional registration is of great value; for example, where a ship has been transferred to British ownership when abroad. It is not uncommon for that to happen. It is perhaps a pity that the noble Lord is not able to listen to what I am saying. It is an unfortunate amendment which should not be supported.
4.30 p.m.
Lord Brabazon of Tara: We need to have a system of provisional certificates to deal with the case of a ship acquired abroad, but the present system, as the
562
noble Lord, Lord Underhill, said, has been the means by which some unsatisfactory tonnage has sailed under the British flag. It needs to be tightened up. The noble Lord, Lord Underhill, may not be aware that the effect of the amendment would be to leave the system as it is at present.
Paragraph 13 would tighten up the issue of provisional certificates by reducing the period of validity from six months to three months and providing that no further certificate may be issued within one year. It would also end the present anomaly whereby provisional certificates can be issued in foreign but not in Commonwealth countries.
These are modest but important changes. I am well aware that the noble Lord did not mean to do what he is doing with the amendment. The amendment would put us back to where we are at the present time and not get rid of the provisional certificates.
Lord Underhill: The noble Lord's last sentence puts me in a quandary. By leaving out paragraph 13 we believe that there would be no provision for provisional registration. If the position is as the noble Lord says, there is no purpose in pressing the amendment. All I can do is to read carefully what he and the noble Lord, Lord Mottistone, have said and in the meantime withdraw the amendment. However we are still of the opinion that there ought to be an amendment to delete the provision, but this may be covered by the period of duration which will follow in subsequent amendments. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Lord Brabazon of Tara Lord Brabazon of Tara moved Amendment No. 25:
Page 45, line 42, leave out ("a ship becomes the property of") and insert ("a majority interest in an. unregistered ship becomes owned by").
The noble Lord said: I spoke to this amendment with Amendment No. 6. I beg to move.
On Question, amendment agreed to.
Lord Mottistone Lord Mottistone moved Amendment No. 26:
Page 46, line 19, leave out ("has been") and insert ("will be").
The noble Lord said: Thank heavens I can speak to this amendment! Paragraph 13 deals with the registration of ships that may have been bought overseas and will be far away. The whole point of provisional registration is that a ship is far away and formal registration cannot proceed for the time being. I suggest to my noble friend that it is wrong to talk in the past by saying,
"accompanying the master's application that an application for registry of the ship has been made",
as it has almost certainly not been made because the ship is far away. It seems more sensible and better English, quite apart from realising the facts of the case, to say that,
"accompanying the master's application that an application for registry of the ship will be made",
which will be made as soon as it can be when a ship reaches a position where it can make it. I beg to move.
Lord Brabazon of Tara: I cannot agree that our change to the 1894 Act would negate the purpose of provisional registry. We intend to make it clear in new guidance to consuls and high commissions that a simple letter to a United Kingdom registrar declaring that the owner wishes to apply for full registration will suffice as evidence that such an application has been made. I hope that meets my noble friend's point and that he will be able to withdraw the amendment.
Lord Mottistone: I do not think it does, and with the greatest respect to my noble friend, I do not think he knew what I was going to say. I shall look at what he said but I hope that he will look at what I have said with a view to this matter coming up again at a later stage either from his worthy mouth or mine. At this stage, I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Lord Mottistone Lord Mottistone moved Amendment No. 27:
Page 46, line 23, leave out ("three") and insert ("six").
The noble Lord said: This amendment seeks to establish the status quo. The current period of provisional registration is six months. It is not uncommon for a ship purchased abroad not to visit a port where there is a registrar for some considerable time. This can be expected to continue. There seems to be no real point in reducing the present time limit from six months to three months. I am concerned that in Amendment No. 28 the noble Lord, Lord Underhill, seeks to reduce it to one month, which would make the time limit even less practicable in real terms. In this case six months seems a reasonable figure and I cannot see that three months makes all that difference. We may as well stick to the status quo. I beg to move.
Lord Underhill: In moving Amendment No. 27 the noble Lord, Lord Mottistone, referred to Amendment No. 28 in my name and that of my noble friend Lord Carmichael. Therefore I think it would be for the benefit of the Committee if I make observations about our amendment and say why we prefer it to the noble Lord's amendment.
We suggest a period of one month. The Government suggest three months. The noble Lord, Lord Mottistone, wants temporary registration to go to six months.
Lord Mottistone: Not to go to but to remain at.
Lord Underhill: I beg the noble Lord's pardon. I base my argument partly on the consultative document issued in 1984 when the Department of Transport and presumably the Secretary of State at the time contemplated a temporary registration period of one month. I should like to quote from paragraph 34 of the consultative document, which says;
"It is therefore proposed that certificates of registration he made available for a period of one month only. Another possibility which could be considered is to refuse provisional registration unless the master of the ship can provide satisfactory certificates under the law of the state of previous registration except on condition that the ship will immediately proceed to a British port for survey and full registration".
564
Therefore at that time the department, and presumably the Government, saw all the problems of temporary registration and wanted to reduce the period to one month. I do not know what has happened in the meantime to make it change its view to three months. Perhaps it was persuaded by comments. I do not suppose they were comments from the general council because I believe the view put forward by the noble Lord, Lord Mottistone, of six months is the view of the general council. It may be that the Minister can explain to us why the Government changed from their suggested one month, as in the consultation paper to which I have referred, and now propose three months in the Bill.
The problem is that the ship will not have been surveyed for United Kingdom statutory purposes. If such a ship arrives in a United Kingdom port with a dangerous cargo—and one can visualise various types of dangerous cargo—what steps can he taken to ensure that it can be unloaded or loaded in safety? We all know the position of the owner or driver of a motor vehicle for which a valid MoT test certificate has not been issued. He is only allowed to drive the vehicle to a testing station.
A ship which has not been properly surveyed could be more dangerous than an untested motor vehicle. The need therefore is to have as low a provisional registration period as possible. That is why we propose in Amendment No. 28 that the Government's proposal of three months should be changed to one month, which was the Government's original intention in paragraph 34 in the 1984 consultative document to which I have referred. I cannot move my amendment yet but I give notice that I shall move it at the appropriate stage.
Lord Geddes: In support of my noble friend Lord Mottistone I would strongly urge my noble friend the Minister to seriously consider my noble friend's amendment in this respect and maintain the status quo. Compared with other noble Lords—and I see one in his place this afternoon—I have but a mere paltry 25 years' experience in the shipping industry, but I can assure your Lordships that six months is not too long a period.
As I understand it, this amendment is being moved for purely practical reasons. I know many of your Lordships may find it amazing but it often requires up to six months to effect such a situation: to get into position and get, dare I say it, the red tape untangled sufficiently to get the proper registration made. Three months will be extremely short, and (although I realise this relates to the next amendment) one month would be hopelessly impractical. I strongly support my noble friend.
Lord Greenway: Following on what the noble Lord, Lord Geddes, has said, perhaps the Minister might be able to provide some clarification for me on this. Let us suppose that an English company purchases not a substandard ship—and I think basically that the noble Lord, Lord Underhill, is trying to cut out the substandard ships with his amendment—but a thoroughly modern and efficient container ship that has been built to all the latest international standards and wishes to operate it in the

565
cross-trades (that is, the ship would never normally come to this coast at all). Is that company then duty hound within that six-month period to bring the ship hack to the United Kingdom to re-register it before putting it into its intended service?
Earl Attlee: I should like to support the amendment of the noble Lord, Lord Mottistone. If someone buys a ship and that ship is in a port and that port happens to be strike-bound, which happens, what would happen if you had only one month? I personally have been in the roads of Singapore and been at anchor for six weeks. I admit that that was at the end of the war. I think that three months is too short and I would support the amendment in order to keep the status quo.
4.45 p.m.
Lord Brabazon of Tara: There is obviously a difference of opinion between my noble friends and others and the noble Lord opposite, which leads me to believe that the Government have probably got the period of time about right. As the noble Lord, Lord Underhill, mentioned, it was originally one month in the Green Paper 1984 proposals, but following consultation with the General Council of British Shipping we have put forward the three months that we have in the Bill at present.
Having said that, the General Council of British Shipping has been unable to meet my department's requests for evidence that limiting the duration of a provisional certificate to three months would seriously inconvenience its members' operations. In this day and age I think that it would be unsatisfactory that any British ship should be allowed to sail under the British flag for up to six months without a survey, but if the occasional difficulty arises it would be open for the Secretary of State to grant a renewal under paragraph 13(5) of Schedule 1.
In answer to the noble Lord, Lord Greenway, and the noble Earl, Lord Attlee, our surveyors travel all round the world to conduct these surveys, so it is quite possible for a survey to be done in any port. The ship would not have to return to the United Kingdom for that to happen. On balance I think that six months would be too long, and we have accepted from the General Council of British Shipping that one month would be too short and would cause difficulties, so I hope that we can leave the Bill as it is presently drafted at three months.
Lord Mottistone: I was disturbed to hear my noble friend say that it would be unsatisfactory to have ships steaming around the ocean for six months, but they do that now. Therefore, presumably he is not happy with what is happening now. So far as I can understand from the advice that I have had, it may be that the General Council of British Shipping has not been able to convince my noble friend's advisers that three months would not be good enough, but I am not sure that his advisers have convinced my advisers that the present arrangement of six months is unsatisfactory and that there is all sorts of evidence that this is so. My noble friend did not say that there was any such evidence and nor did noble Lords opposite.
566
It seems to me that this matter is still open and we need to pursue the question as to why the six months that we have at the moment is not good enough. I hope that there might be discussions between now and Report stage when we can look into that to see whether there really is good evidence that the six months is not good enough.
Viscount Massereene and Ferrard: Will my noble friend Lord Mottistone agree that there are oceans and oceans? The North Atlantic can cause great stress on the hull, whereas other oceans may not. Therefore I cannot agree with my noble friend when he says that six months should be the proper time before the ship is surveyed when newly purchased by new owners. I personally would say three months, but there we are.
Lord Mottistone: My noble friend has his own view. First, may I point out that it is up to six months. Secondly, I do not think there is any evidence of British shipowners buying ships abroad which are in a terrible state of repair and which are liable to fall apart before they have been surveyed. Apart from anything else, that would be commercially stupid. There is much more to this and I am not at all satisfied that my noble friend thinks he has struck the happy medium. There is probably room for something nearer the six months that is the present state of affairs. In the meantime, I beg leave to withdraw my amendment.
Amendment, by leave, withdrawn.
Lord Underhill Lord Underhill had given notice of his intention to move Amendment No. 28:
Page 46, line 23, leave out ("three months") and insert ("one month").
The noble Lord said: In the light of the Minister's statement that he could not accept this amendment, I shall not move it. But I still stand by what the Government said in their consultative document.
[Amendment No. 28 not moved.]
Lord Brabazon of Tara Lord Brabazon of Tara moved Amendments Nos. 29 to 36:
Page 46, line 37, at end insert—
(".In section 24 (transfer of ships or shares), for subsection (1) substitute—
"(1) Any transfer of—

(a) a registered ship, or

(b) a share in any such ship,

shall be effected by a bill of sale, unless the transfer will result in a majority interest in the ship no longer being owned by persons qualified to be owners of British ships.".").
Page 46, line 38, leave out from ("transfer),") to end of line 39 and insert—
("(a) after "transferred" insert "in accordance with section 24(1) of this Act";
(b) for paragraph (b) substitute—
"(b) a declaration that, to the best of his knowledge and belief, a majority interest in the ship is owned by persons qualified to be owners of British ships, and the ship is otherwise entitled to be registered."; and
(c) at the end add—
"In the application of this section to a ship which is not wholly owned by persons qualified to be owners of British ships, paragraph (a) above shall have effect only in relation to persons who are so qualified.".").
Page 46, leave out lines 43 and 44 and insert—
("(a) in subsection (1)—

(i) for the words from "a person" to "under this Act" substitute "any person by any lawful means other than a transfer under section 24 of this Act and a majority interest in the ship remains in the ownership of persons qualified to be owners of British ships", and

(ii) omit paragraph (b); and").

Page 47, line 1, leave out ("(1)").
Page 47, line 2, leave out from ("person"") to end of line 9 and insert ("for subsection (1) substitute—
"(1) Where the property in a registered ship or share therein is transmitted to any person by any lawful means other than a transfer under section 24 of this Act, but as a result a majority interest in the ship no longer remains in the ownership of persons qualified to be owners of British ships, then—

(a) if the ship is registered in England and Wales or in Northern Ireland, the High Court, or

(b) if the ship is registered in Scotland, the Court of Session,

may, on an application by or on behalf of that person, order a sale of the property so transmitted and direct that the proceeds of sale, after deducting the expenses of the sale, shall be paid to that person or otherwise as the court direct."").
Page 49, line 10, leave Out ("(1)").
Page 49, leave out line 11 and insert ("for subsection (1) substitute—
"(1) A person shall not be the managing owner of a registered ship unless he is a person qualified to own a British ship, and the name and address of the managing owner of any registered ship shall be registered by the registrar of the ship's port of registry.").
Page 50, line 23, at end insert—
(".In section 69(1) (penalty for unduly assuming British character), for the words from "owned" to "own a British ship", substitute "in which a majority interest is not owned by persons qualified to be owners of British ships, and does so".").
The noble Lord said: I beg to move Amendment No. 29. I spoke to this amendment with Amendment No. 6. This is a large group extending to Amendment No. 36. With the leave of the Committee, I should like to move Amendments Nos. 29 to 36 en bloc.
On Question, amendments agreed to.
Schedule 1, as amended, agreed to.
Clause 10 [Regulation of registration in overseas territories by reference to categories of registries]:
On Question, Whether Clause 10 shall stand part of the Bill?
Lord Underhill: I should like to raise a few points on Clause 10. It deals with the regulation of registration in overseas territories and does so by reference to categories of registries. Subsection (2)(a) lists four such categories. I believe it desirable for the Minister to give details of the categories of ships envisaged in paragraphs (i) and (ii); that is, ships' tonnages or types of ships. There are also the rather vague, additional categories under paragraphs (iii) and (iv). Paragraph (iii) reads:
"any other specified matter, or",
and (iv) reads:
"any combination of matters falling within one or more of the preceding sub-paragraphs".
I have looked at the Notes on Clauses and I have gained no help in understanding the "other specified matters" or the "combination of matters". They state that the appropriate category would relate to the ability to administer and enforce the international
568
safety conventions. Again there is no mention in the clause of the ILO or IMO conventions.
Paragraph 7 of the consultative document states:
"These international conventions place onerous duties on flag states which have adopted them. For the UK, which is a party to all these conventions, it is of paramount importance that regulations can be applied and enforced effectively on all ships registered in the UK and its dependent territories".
Paragraph 10 states:
"In order to take the duties of a flag state it is now necessary, because of the substantial body of international shipping law, to have a permanent marine administration, including an appropriate number of professional surveyors".
Dealing with Clause 10, paragraph 21 of the White Paper states that the new powers under this clause will require:
"a suitable marine administration".
Will the Minister give details of what is regarded as a suitable administration in terms of resources, particularly the number, qualifications and experience of staff? Also, and possibly more important, will he detail the ability to supervise and enforce the requirements of IMO safety conventions and the relevant ILO conventions, including the important No. 147 convention which relates to minimum standards.
Clause 6(3) gives power to the Secretary of State to direct or refuse a registration under specified circumstances. Does the Minister agree that that power to refuse registration should be extended to registration in overseas territories? A refusal to register in the UK would, I believe, not prevent an owner from seeking registration in an overseas territory for a ship which is substandard by United Kingdom standards.
My comments relate to various paragraphs of the 1984 consultation document. For the purposes of the record, they are paragraphs 7, 10, 11, 12, 28, 29 and 30. I believe that points that I have raised are important and I should appreciate the comments of the Minister.
Lord Brabazon of Tara: I am grateful to the noble Lord for raising this matter because it gives me the opportunity to expand on our proposals in this clause and on the criteria which we would use in assigning dependent territories to appropriate categories.
The key question is whether the territory concerned is in a position to enforce the international safety conventions which form the basis of the Memorandum of Understanding on Port State Control. These are the Conventions on Loadline Safety of Life at Sea (SOLAS): Marine Pollution (MARPOL); International Regulations for Preventing Collisions (COL REGS); Standards of Training and Watchkeeping (STCW); and the ILO Convention No. 147 (Minimum Standards in Merchant Ships). In all but the last two cases the original conventions have been supplemented by later amendments and we would take those into account to the extent that the UK has acceded to them and they have come into force.
Enforcement requires two things—appropriate legislation and qualified people to administer and enforce it. As regards the first, we would expect the territory concerned to have in place legislation

569
equivalent to the UK statutes, regulations and merchant shipping notices through which the conventions are enforced and administered in this country. Several dependent territories are now in the process of acquiring such powers and my officials are working closely with them for that purpose.
As regards personnel and resources, steps are now being taken by a number of territories to strengthen their marine administrations, in some cases by the appointment of surveyors from my department. In addition to this strengthening of the headquarters function, there is the very considerable amount of field work, such as surveying the ships and issuing them with the appropriate international certificates and the investigation of casualties. I have agreed to make available surveyors from my department on a repayment basis to carry out this work on ships registered in the dependent territories on behalf of the administrations there.
That will be done for a trial period, to be reviewed after two years of operation. The objective will be for the dependent territory registered vessels to be subject to a survey regime equivalent to that for UK vessels. Dependent territories will be assigned to a category which reflects these points. Those able to enforce the conventions will be assigned to the highest categories with, where appropriate, restrictions on certain types such as passenger vessels. Others will he limited as to the ships they can register; for example, shipping vessels and small ships.
We keep a close eye on resources and I am satisfied that they are sufficient to meet the tasks placed on the surveying services, including the work on behalf of the dependent territories.
The noble Lord asked a question in relation to Clause 6, the extension of powers to refuse registration on safety grounds to the dependent territories. Clause 50 makes provision for extension in provisions of the Bill to dependent territories.
Our aim is that, when all this is in place, the ships registered in dependent territories will be of at least as high a standard as those registered in the UK within the category to which they are entitled to register. I hope that the noble Lord will be happy with that explanation.
Lord Mottistone: I am advised by the General Council of British Shipping, as the Committee and my noble friend know. It welcomes the principle for this clause but is concerned that the regulations might be drawn up too tightly. Of course they must not be too loose. The council hoped that it would be consulted in the drawing up of the regulations. Can my noble friend give me an assurance that the general council will be consulted on the drawing up of regulations?
Lord Brabazon of Tara: We consult the general council regularly on virtually every subject in merchant shipping. I can give my noble friend the assurance that we shall consult it in respect of this matter.
Clause 10 agreed to.
Clause 11 agreed to.
Clause 12 [Separate registration of fishing vessels]:
5 p.m.
Lord Campbell of Croy Lord Campbell of Croy moved Amendment No. 37:
Page 10, line 4, leave out from first ("or) to end of line 5 and insert ("a period of six months beginning with the commencement of this Part,").
The noble Lord said: We come to Part II of the Bill in which the Government seek to introduce a completely new system for the registration of shipping vessels. The Committee will remember that at Second Reading I fully supported the Government in introducing the new scheme. For the benefit of the Committee, I shall briefly put this in context.
Advances in catching techniques, which, so far as the fish are concerned, entails lethal modernisation, mean that stocks of fish which are in demand for human consumption could be wiped out. There is the example of the North Sea herring. A ban had to be imposed on all fishing for about six years—an awesome example of what could happen. As a result, the European Economic Community evolved a system of quotas, which is in the best interests of the fishery industries of all the countries concerned because it means conservation. As part of the agreements, which were reached with difficulty, there had to be clarity on the nationality of the fishing boats involved because quotas are allotted to each country's boats.
In recent years this Chamber has heard me speak about the 50 or so Spanish fishing boats which managed to register at British ports and therefore were taking part in fishing under the United Kingdom quotas. That kind of change in nationality has the effect of upsetting the basis of the agreements. The Government are therefore introducing a new registration scheme, which, as I see it, is an attempt that I applaud to secure certainty on nationality and prevent vessels adopting disguises that happen to suit them at the time.
As part of that system, there is to be a transitional period, mainly for the benefit of vessels that are now on the register but of doubtful nationality, so that if they wish they can attempt to qualify for the new register. That transitional period was spelt out in paragraph 36 of the White Paper issued by the Government at the time of presentation of the Bill, although is not described as a transitional period in the Bill, where it appears at Clause 12(3)(b). The only fault I find is that there is no indication of how long that period is to be. The period of transition is to be prescribed by subordinate legislation to be introduced later by the Government, and it might be six weeks, six months or six years.
My amendment proposes that the period should be six months. I think I can claim that the amendment might be described as the apotheosis of reasonableness because of the timing. This Bill will take at least six months to go through Parliament. The owners of the vessels concerned can see its contents perfectly well and know that it is likely to pass into law. No doubt there will follow a pause before the commencement date for Part II of the Bill and then, if my amendment is accepted, a further period of six months will elapse. There will therefore

571
be plenty of time for the vessels of doubtful nationality to prepare their case and gather supporting documents in an attempt to qualify for the new registration system.
I ask my noble friend the Minister, first of all, why the Government have not specified the transitional period in the Bill and why that period cannot now be made plain? Secondly, if there is some reason for not specifying it now, can he give some indication of what it will be—for example, whether it will extend to months or years? That will greatly reassure British fishermen. The Scottish Fishermen's Federation has been concerned about this matter and has been in touch with me. The Committee will remember that I have referred in the past to the support received from Spain and genuine Spanish fishermen who themselves disapprove of the boats which have been registered in Britain because they recognise that this practice distorts the agreements and does not help them.
I should like to remind the Committee that I was a member of the sub-committee which dealt with enlargement of the EC when Spain and Portugal were applicants to join. That committee reported to this House and in the ensuing debate sea fisheries were seen as one of the most difficult and important issues, particularly as regards Spain. Those difficulties were resolved and agreements were reached. I believe that they were good agreements and they were reached with difficulty. We should not now allow the adoption of disguises which distort those agreements and shake the confidence of fishermen who are expected to stick to the quotas and make the agreements work. I beg to move.
Viscount Massereene and Ferrard: I should like to draw attention to the fact that some years ago Denmark exceeded by about three times its quota of herring from the North Sea and nothing was done about it. Our quota was much larger than Denmark's but Denmark exceeded even our catch.
My noble friend Lord Campbell of Croy has raised the question of agreements. I am sorry to have to say it but I think that some of our partners in the EC are rather inclined to cheat on fishery quotas and exceed them. That may be going a little outside the question of this amendment but I think that if there could be some better policing arrangement on the high seas, we could ensure that such cheating does not happen.
Lord Parry: Obviously, I should much prefer to have on my side the noble Lord, Lord Campbell of Croy. We have always been on the same side during debates on issues with regard to the fishing industry ever since I joined him in this Chamber some 13 years ago. It goes without saying that to speak against an amendment that he has proposed is not an attractive proposition because of his formidable reputation and wide knowledge. However, there are one or two weaknesses in the argument that he has put forward which is not to say that there is not also a major weakness in the argument put forward in the Committee's whole consideration of the Bill as it affects fishing.
572
It seems to me that should we take to its extreme the argument of the noble Lord, Lord Campbell of Croy, in supporting his amendment, we would eliminate British Petroleum and ICI because 70 per cent. of the ownership of those companies is no longer vested in the citizens of Great Britain. I shall make that general charge first; we must be absolutely certain that when we lay down regulations or propose amendments to a Bill they are logical within the general context of the issues in question.
The Government are very properly seeking inward investment in the economy and doing everything that they can to encourage it. For example in today's Western Mail I read that the Secretary of State has spoken of a bid to woo Japan's banks. In circumstances where there is a definite, supported and long-term attempt to involve other nations in the development of the economy and specific aspects of the economy, perhaps it is quite wrong that we should be taking a nationalistic stance in this particular issue. However, I do not wish to lose support for my argument for the amendment in my name which follows, because I should dearly love to have the Chamber support me on it.
I wish to say that there are Spanish vessels which are vested in people who have established a long-term commitment to the Welsh economy. Those vessels, based where they are, are not simply serving their own interests, although of course these are paramount. I am sure that no one on the opposite Benches will criticise people anywhere in private enterprise for seeking to develop their own interests. But incidentally and directly, there is also a development of the fishing industry, which has been decadent in Wales during my entire lifetime. I have made a number of speeches in this Chamber about the decay of the Welsh deep-sea, middle and inshore fishing industries, and I have been supported by the noble Lord, Lord Campbell of Croy.
The present situation is that one has a number of young and enterprising individuals who see an opportunity to build up companies in both Spain and Britain to the advantage of the Welsh economy. It would be quite wrong if at this stage protectionist attitudes were to prevent their developing the business that they have. If we impose a six months' limitation, how can we expect a company to invest in all the necessary appurtenances for the redevelopment of the fishing industry in a port? Let me declare my interest. I am chairman of the Milford Docks Company. We have brought it through a very difficult period. We have refinanced and restructured it and have looked to the fishing industry—both the indigenous industry and the incoming industry—to help us to create a better economy. So I totally resist a further attempt to limit the Minister's discretion and I speak against the amendment.
Lord Mottistone: There is one point which I think the noble Lord, Lord Parry, overlooks and which my noble friend Lord Campbell of Croy mentioned. That is the very hard-fought common fisheries policy which we had to study at great length in the happy days when I was a Member of European Communities Sub-committee D. There was no doubt about it that that was worked out extremely carefully

573
to meet the needs of all the Community nations. At that stage the Spanish were not part of the Community. They have now come in and have had to accept the rules of the game—of the club, if you like.
It seems to me wrong that we should do something which is potentially driving a coach and horses—such as the argument which the noble,Lord, Lord Parry, has put forward—through the principles by which the current common fisheries policy exists. It could be that in the passage of time other arguments will prevail and we shall move on. We have had two common fisheries policies, one just before we went into the Community, which troubled us, and now another one just before the Spaniards came in, and in 10 years' time or possibly even less the Community will no doubt address its attitude to this subject. But until that happens it is most important that we should safeguard what we have, and I see this part of the Bill as trying to do that. It is a pity to alter it in any way which gives special rights to the Spaniards, just because they were not there when the rules of the game were being drawn up.
Lord Parry: Perhaps I may say in response that the noble Lord, Lord Mottistone, is quite right. I totally applaud that degree of protection for the British fishing industry. I totally applaud, too, the emphasis on allowing the Minister discretion to decide. It is the limitation of that within this amendment to which I object. I am perfectly prepared to debate the other issue in relation to my own amendment when it comes before the Committee after this amendment is disposed of.
Lord Brabazon of Tara: We have probably heard deployed on this amendment some of the arguments that more properly relate to the amendment of the noble Lord, Lord Parry, which will come up next, about the whole issue of the common fisheries policy, quota-hopping and so on. My noble friend Lord Campbell of Croy said that there are about 50 quota-hopping, flag of convenience fishing vessels on the UK register. I have to tell him that the figure at the moment is approximately 129. So it is a serious problem.
Obviously I have some sympathy for this amendment. We shall of course want to avoid a protracted transitional period so that fishing vessels not eligible to register under the new rules will cease to be allowed to fish for profit. But managing the transition and investigating the eligibility of vessels to join the new register will be a major task and it would be rash to write a firm figure into the Bill.
We need flexibility to set the end-date by regulation, but I can assure my noble friend and other noble Lords who have spoken that we shall want to complete the transition as soon as we possibly can. I very much hope that it will be within six months, but I should like to keep the flexibility in the Bill as it is at the moment. I think it could be important in the future. So I hope that my noble friend will feel able to withdraw this amendment.
5.15 p.m.
Lord Campbell of Croy: I am grateful to my noble friend because he has given an indication of the kind of period which he envisages, which sounded similar to the one which I have in my amendment. The noble Lord, Lord Parry, and I, as he said, have taken part in various debates on other subjects on which we have usually been in agreement, and he has spoken on what is really the debate on his Amendment No. 38 which comes next. I shall comment only briefly on what he said.
The noble Lord started by telling us that if this principle were adopted large companies like BP and other corporations would be in trouble. But as I understand it that is the whole reason for Part I of the Bill being different from Part II. Part I of the Bill deals with registration of shipping in general. Part II, because of the problems which we have described, deals with a specialised register for fishing boats.
There is no way of having a workable system for the conservation of stocks of fish, other than by including the identification of fishing boats, being able to see them from the air and to police the fishing of various areas and zones. If boats were able to change nationality, like the Spanish boats have done, it would make a nonsense of the whole system. We would have to start another system. Having agreed on a system of this kind which depends upon the nationality of fishing boats, the registration of fishing boats is a separate subject and is dealt with in Part II of the Bill.
I know that the noble Lord, Lord Parry, has in mind the port of Milford Haven and I am well aware that that port had a fleet of British boats which were involved in distant and middle water fisheries, which have declined and have now virtually disappeared. I can quite understand that that port adopted the Spanish boats that were willing to come in and no doubt they have performed services there. So I understand the reason for his amendment. However, they simply must become British boats, completely UK boats, and shed their foreign nationality completely. If not, then they must be Spanish boats operating under the agreements with Spain.
I am grateful to my noble friend Lord Mottistone for expanding on the agreements which had to be reached on, first, the common fisheries policy and later—which was just as difficult a situation— when Spain and Portugal were joining the Community. Those agreements were successful and it would be absolutely wrong to drive a coach and horses through them now. So while sympathising with the particular difficulty in that port which the noble Lord mentioned, I think that the general principle which the Government are bringing forward should be the acceptable one. Having heard what the Minister has had to say, I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Clause 12 agreed to.
Schedule 2 agreed to.
Clause 13 [Eligibility for registration as British fishing vessel]:
Lord Parry Lord Parry moved Amendment No. 38:
Page 11 line 15, at end insert—
("(4A) Where in any case the Secretary of State is satisfied that—

(a) the relevant persons or companies are nationals of an EEC Member State;

(b) the relevant fishing vessel was at the date of the commencement of this Act registered under any of the enactments referred to in section 12(2) above; and

(c) the relevant fishing vessel maintains a genuine and substantial connection with the United Kingdom.

then the Secretary of State shall dispense with the requirements of subsections (1)(6) and (c) above and, so long as the requirements of paragraphs (a) and (c) of this subsection continue to be satisfied, the said fishing vessel shall be treated for the purposes of this Part of this Act as eligible to be registered as a British fishing vessel.
(4B) Where a fishing vessel has been treated for the purposes of this Part of this Act as being eligible to be registered as a British fishing vessel pursuant to the provisions of subsection (4A) above, if the owner of such a vessel, being a person who satisfies the requirements of paragraph (a) of subsection (4A) above, purchases another fishing boat to be used in substitution for the fishing vessel referred to in paragraph (b) of subsection (4A) above, or a fishing vessel to be used in substitution for a fishing vessel referred to in this subsection, then so long as the requirements of paragraphs (a) and (c) of subsection (4A) above continue to be satisfied, that substitute fishing vessel shall be treated for the purposes of this Part of this Act as eligible to be registered as a British fishing vessel.")
The noble Lord said: I beg to move the amendment standing in my name on the Marshalled List, and underline again the twin ironies that I do it as an unconvinced man as regards the values of the EC, and also have a life-long record of a deep interest in the British fishing industry as based around the Welsh coast and am supportive wholly of British fishing interests. Having declared my interest already, I do not propose to deal specifically with legal issues.
I understand that there is no dispute—and I shall be corrected by the Minister if I am wrong—about the unlawfulness of the Merchant Shipping Bill and the present draft of the proposed Commission regulations. I also understand that the Commission has started infraction proceedings against the United Kingdom in relation to the Merchant Shipping Bill. Indeed the noble Lord, Lord Brabazon of Tara, in a rather wistful and hopeful ending to his fishing references at cols. 1331–2 of the Official Report of 10th November said—I see that he is baffled—
"Noble Lords may well he aware that foreign interests—shall I call them? —attempted to take us to court even before this Bill was published, and I do not underestimate the difficulties of the possibilities of further attempted legal action, but I hope that the way in which we have drafted the Bill will preclude that".
Precisely because my advice is that the Bill is unlawful and that there will be legal proceedings, I was anxious to put down an amendment which would remove that difficulty for the Minister. I want to deal with what is seen as being a complete failure to appreciate the real and growing links that exist between some of the vessels in question and the United Kingdom, particularly in my home port. It is this complete lack of understanding which lies behind the proposed Commission regulation and the Merchant Shipping Bill as I see it.
In the United Kingdom there are about 85 fishing boats. The numbers mentioned tonight have vied between 50 and 100. Although those boats are owned by United Kingdom companies, in essence very
576
substantial Spanish shareholdings exist in those companies. Of those boats about one third have always been British fishing boats but have been sold by British fishing interests to Spanish fishing interests. Virtually all have been British fishing boats since before the national quotas were adopted and before the British Fishing Boats Act 1983.
Of the 85 boats only three have become British fishing boats since 1983. Therefore there is no question here of any temporary annexation to the British flag. I draw that to the attention of the noble Lord, Lord Campbell of Croy, whom I respect so much in that connection.
All these boats have since 1st January 1986, (which is also the date of Spain's entry to the EC) operated pursuant to licences granted by the UK authorities. In the main they fish off the west coast of Ireland for species of fish such as monk, megrim and hake which are not fished normally by other UK, Welsh or Irish boats. Therefore in many regards there is no conflict concerning the catches.
The basic requirement of the licence is that there should be a genuine economic link between the vessel and the flagged state. The licence purports to do this by requiring that three conditions are satisfied. One of the conditions requires a 75 per cent. UK or other EC crew other than Greek, Spanish or Portuguese. It is provided that such crew only satisfy this requirement if they are resident on shore in the United Kingdom. Thus a fisherman resident in Boulogne would not count. The whole crew must pay social security contributions to the United Kingdom. The vessel must operate from the United Kingdom. That can and is interpreted by the UK authorities as must operate from the United Kingdom. The vessel must make four landings in a United Kingdom port every six months, save that landings less than 14 days apart do not count.
Conditions one and two have been challenged by the owners of vessels. Such challenges include case No. 387, Agegate, and case No. 216, Jaderow, 1987. In both cases the Commission agrees with the contentions of the owners that the conditions are unlawful.
The owners of the vessels in question have not disputed that they must maintain a genuine economic link with the United Kingdom. They maintain that they have always achieved this by the vessels being managed in the United Kingdom, by the owning companies paying tax and VAT in the United Kingdom, and by the fact that they carry out very substantial financial activities in the United Kingdom. In 1986 some £7 million of both ordinary expenditure and capital expenditure was spent on behalf of or in relation to these vessels in the United Kingdom. That has not been disputed by the United Kingdom authorities.
The effect of the crewing condition in particular has in the past kept vessels away from the United Kingdom for fear of the very great penalties for failing to comply with that condition. That has meant that many owners have been unwilling to risk coming to the United Kingdom without some form of protection and having their vessels arrested by the United Kingdom authorities.
In the case of the Jaderow litigation, the owners of the vessels and the United Kingdom authorities came to an agreement. That is known as the Jaderow agreement and it is dated 19th May 1987. By that agreement it was agreed (inter alia) that the vessels need not comply with Condition one-the crewing requirement—until the judgment on Agegate was decided by the Court of Justice. This was again referred to by the noble Lord, Lord Brabazon of Tara, on 10th November. By that agreement it was also agreed that the United Kingdom authorities would not place any reliance upon any alleged breach of the operating condition for the period 1st January 1986 to 30th June 1987.
In return the owners agreed, without prejudice to their contention as to the unlawfulness of that condition, to comply with that condition by calling into United Kingdom ports on at least four occasions in each six month period. This agreement is, at the United Kingdom Government's insistence, to last only until the Agegate judgment.
Consequent upon that agreement the vessels in question have since 1st July 1987 been calling regularly at United Kingdom ports. By early October approximately two thirds of these vessels had made at least half of the required calls. Indeed some vessels had already made all their calls. The owners have no doubt that by the end of the year all the vessels will have performed the required number of calls, except for those vessels which have been tied up for all or substantially all of that period. Those vessels have been landing some fish at the local markets.
As regards the economic ties, I wish only to say one thing. I repeat that I say this particularly because I am happy to see the noble Lord, Lord Crickhowell (who was Secretary of State for Wales for six years), in the Chamber. He was very much responsible for the initiatives which have sought inward investment from foreign sources in the economy of Wales. I must reiterate my tribute to what he did and welcome him to the Chamber although he and I fought three general elections in opposition to one another.
The important initiatives taken to strengthen the economy of Wales are being contributed to by the Spanish fishing boat interests. In my amendment I am asking that we strengthen the position of the Minister. The Minister has already gone a little way towards accepting this. I beg to move the amendment standing in my name.
Lord Campbell of Croy: The noble Lord, Lord Parry, has indeed moved his amendment in a way which was to be expected after his interventions on the previous amendment. I say straightaway that he rightly paid a tribute to my noble friend who is sitting beside me and who has only been in your Lordships' House for a few days and has not yet made his maiden speech. Therefore he cannot speak in this debate. However, the noble Lord, Lord Parry, was quite right to pay that tribute to what my noble friend has done for fishermen in Wales.
What the noble Lord, Lord Parry, has said means that I must dilate briefly on the agreements reached when Spain and Portugal joined the EC. The traditional fisheries which Spanish vessels had
578
prosecuted outside the EC waters were continued. Spain has fished traditionally off West Africa and still fishes in distant places such as the South Atlantic. Every encouragement was given to the Spanish fishing fleets to continue fishing there.
As the noble Lord mentioned, where Spanish boats were fishing for species which are not favoured in this country and are the kind of fish which the British housewife does not buy at the fishmonger's, Spain was able to continue fishing or to fish more, or even not to have quotas imposed. But as regards the fish at risk or the fish which are in demand for human consumption, the common fisheries policy already applied. In that case, we had to negotiate very carefully with Spain and Portugal and reach an agreement. That meant that the common fisheries policy which had already been agreed was virtually untouched. Spain accepted that all the other things which the EC was able to help it with enabled its fishing fleets to continue as before. I think that we are in agreement on that, but it is still essential that the common fisheries policy should be carried out. As one of my noble friends suggested just now, there are suspicions among fishermen that the fishermen of other nations are cheating from time to time. That makes it even more important not to make an enormous loophole in agreements of this kind.
It must be made absolutely clear what nationality the fishing boats are. We must know which vessels are British and which are Spanish. If there are chameleon-like changes from time to time the conservation of stocks will be impossible. It will not be possible to regulate the arrangements in order to carry out the agreement.
As I said just now, I do understand the Milford Haven situation; but I am told that everyone in that area and all the fishermen there do not agree with what the noble Lord has suggested. There is a school of thought which supports the noble Lord; but I am told that there is a contrary view too. I can tell the Committee quite categorically that the fishing industry in other parts of the country is completely behind the Government on Part II and on the registration of fishing boats which will introduce a completely new system.
I can also say the same of Scottish fishermen. Their organisation has made it quite clear that, although they want to ask questions about the system, they approve of the whole principle behind the system. I have also had messages from the fishermen of the South-East of England who, again, are completely in favour of the system and absolutely against what is suggested by the noble Lord, Lord Parry. Therefore, while I have sympathy with his particular point and the port with which he is concerned, I advise the Committee not to accept the amendment.
5.30 p.m.
Lord Greenway: The noble Lord, Lord Parry, moved his amendment in his usual elegant manner. However, has he considered the furore that would arise if one of his Welsh fishing vessels even proceeded near the Spanish coast, let alone tried to re-register under the Spanish flag?
Lord Gray of Contin: It seems almost unfair to rise as another of those who take issue with the noble Lord, Lord Parry, in what he seeks to do. We all appreciate the great sincerity with which he moved the amendment and we share his concern for those who fish from the port which is closest to his heart. Nevertheless, I think that the point made by the noble Lord, Lord Greenway, is extremely valid.
It would be wrong for me to sit silent, having moved earlier this afternoon an amendment which sought to give protection to British offshore supply vessels in their own sector of the North Sea against the invasion by Norwegian, American and other European vessels. That involved the principle which the noble Lord seeks to break by making a special case for Spanish fishing vessels in UK waters.
I know only too well, as my noble friend Lord Campbell of Croy has said, that the Scottish fishermen feel very strongly about the matter. In fact, I can think of few things on which the feeling of Scottish fishermen is stronger than on the intrusion of Spanish fishing vessels into the protection of the British flag. The principal reason that they are so offended by that trend is the quota system which my noble friend Lord Campbell described earlier. We now have Spanish vessels operating under the British flag and using up what British fishermen—not just Scottish fishermen—see as their share of the very hard-won quota fixed in the negotiations which took place a short time ago.
Although I am reluctant to do so, I must add my voice against the amendment which the noble Lord, Lord Parry, seeks to move. I hope that the Minister will not be persuaded by the eloquence of his arguments.
Lord Brabazon of Tara: We all admire the noble Lord, Lord Parry, for the eloquence with which he moved the amendment, and for the deep interest which he has in Milford Haven and in Wales. However, the fact is that the amendment would completely undermine the purpose of this part of the Bill, which is to preserve United Kingdom quotas for United Kingdom fishermen. As noble Lords have said, the EC quota system has worked well, which is perhaps more than can be said for some other parts of the common agricultural policy.
The amendment would give grandfather rights to fishing vessels owned by EC nationals already on the United Kingdom register. It would also give those rights to EC-owned vessels which join the register between now and commencement—an open invitation to more foreign interests to come in and fish against United Kingdom quotas. It would allow substitutes for those vessels so that quota-hopping would continue in perpetuity.
The amendment would require the fishing vessels concerned to maintain a genuine and substantial connection with the United Kingdom. But as it would also disapply the clear requirements set out in Clause 13(1) for the vessel to be managed and its operations directed from the United Kingdom, and for the manager and operator to be British, it is hard to see what the substance of that condition would be. Certainly if those vessels operate as the existing
580
quota-hoppers do, their crews will not be British and most of their catches will be landed out of the United Kingdom.
The noble Lord, Lord Parry, referred to that matter in part of his speech and said that in recent months they have been making some appearances in the UK. However, most of the landings are overlanded to Spain where beneficial ownership resides. The boats are manned mainly by Spanish crews.
The noble Lord, Lord Parry, also asked me about legal actions which have been taking place. We believe that this part of the Bill is compatible with our obligations under the Treaty of Rome. I am not aware of any proceedings by the European Commission against the Government in that respect. There was a legal action in the United Kingdom courts by certain foreign interests—not the Commission—to the proposal to introduce this Bill. That case was withdrawn by the interests concerned and costs were awarded against them.
As regards the point about quota-hoppers who fish for species mainly not fished by United Kingdom fishermen, the quota restrictions have been necessary in recent years for stocks on which quota-hoppers concentrate. In some cases, fisheries have had to be closed prematurely. That has had a serious effect on genuine UK fishermen fishing for those stocks.
As noble Lords have said, the proposals in the Bill have the unanimous support of fishermen all around the United Kingdom. The amendment would allow foreign interests to continue their fishing against our quotas in perpetuity. Therefore I must ask the noble Lord to withdraw the amendment.
Lord Parry: The Committee and the Minister have been very kind. Many nice words have been said, although my amendment has not attracted much support. I shall return to it when I have the opportunity.
I neglected to mention one important point. There is an indigenous fishing industry or a small element of it left in Milford Haven. It has been part of the economy and has underpinned that economy in good times and bad. It would be wrong for me not to refer properly to those people. The noble Lord, Lord Campbell of Croy, is right in saying that they see their interests being threatened when other people deal in that market.
In response to the debating point offered, I can well imagine that at earlier points in our history there might have been a great deal of truculence to the Japanese companies which are now seen as such a vital part of the economy of Wales. Such things change. I prophesy that the owners of those boats will continue to trade and they will help to build up the local economy because they are committed to the British economy and are seeking the right to trade properly. They do not see themselves as quota-hoppers; they see themselves as young, vibrant and strong, with job opportunities to offer. I am sure we shall hear more of them in the future.
Amendment, by leave, withdrawn.
Lord Grimond Lord Grimond moved Amendment No. 39:
Page 11, line 44, leave out ("75") and insert ("85").
The noble Lord said: Amendment No. 39 is a probing amendment. It seeks to increase the percentage from 75 per cent. to 85 per cent. That is relevant to the designation of boats. The fishermen with whom I am in touch, like fishermen all around the coast, are in favour of the main principles embodied in this Bill. However, I was asked the reason for the figure of 75 per cent. They would prefer a higher percentage. I said that I did not know why the figure of 75 per cent. had been chosen and I rather doubted whether the Government knew. I thought that it was probably an opening shot or a minimum and that it might be increased. However, I see no harm in asking the Government why they have chosen 75 per cent. I emphasise that if that proves inadequate they may increase the percentage that is laid down in the Bill. I beg to move.
Lord Brabazon of Tara: Where to set the relevant percentage is to some extent a matter of judgment. We believe the figure of 75 per cent., which is a stringent one, is as much as is necessary to secure the objectives which we have in the Bill. It would not be helpful either to set a figure which might be thought in Brussels or elsewhere to be disproportionate to the problem we are trying to solve.
Nevertheless, if this figure should prove inadequate there is provision, as the noble Lord said, to increase it in the Bill. I think that situation is covered. For the time being, we think the figure of 75 per cent. is the right level to go for.
Lord Mackie of Benshie: Can the noble Lord tell us in what circumstances it would be inadequate? It seems to me to be curious to put a figure of 75 per cent. and then say that it may be increased to 100 per cent. Can the noble Lord tell us in what circumstances it would be inadequate?
Lord Brabazon of Tara: The answer to that is, I should like to see how the thing works out. If our aims do not appear to be working out that might be the time when we would have to raise the limit.
Lord Mackie of Benshie: I am sorry to be awkward. Does the Minister mean that at 75 per cent. there might be a certain amount of cheating? In other words, you take 25 per cent. and then go on to lend money and thereby achieve control. The Minister really must know more about it than that.
Lord Brabazon of Tara: The object of the exercise is to eliminate quota-hopping. if we find that by setting a figure of 75 per cent. for ownership we eliminate quota-hopping, then we will have achieved our objective. That is really all I can say about it.
Lord Grimond: I am grateful to my noble friend Lord Mackie for putting these difficult and probing questions to the Government. I am satisfied that the Government have indicated that if the main purposes of this Bill are failing—that is to say, that quotas are being abused and that they can be attributed in any way to an inadequate percentage or other unforeseen
582
results—they are perfectly willing to look at the matter again and to increase the percentage up to 100. With that undertaking, with the leave of the House I am prepared to withdraw the amendment.
Amendment, by leave, withdrawn.
Clause 13 agreed to.
Clauses 14 to 17 agreed to.
Clause 18 [Transfer of vessel by bill of sale]:
Lord Brabazon of Tara Lord Brabazon of Tara moved Amendment No. 40:
Page 14, line 33, at end insert (",unless the transfer will result in the vessel ceasing to be British-owned for the purposes of section 13(1)(a).").
The noble Lord said: This is a technical amendment which has no substantive effect on the requirement of the clause. Our interest is in ensuring that vessels which change hands into foreign control are removed from the register. Clause 22 requires the owner to advise the Secretary of State of any changes affecting eligibility to remain registered and which would apply to a sale to foreign owners. I beg to move.
On Question, amendment agreed to.
Clause 18, as amended, agreed to.
Clauses 19 and 20 agreed to.
Schedule 3 agreed to.
Clauses 21 to 24 agreed to.
Clause 25 [Financial assistance in respect of costs of training merchant navy officers and ratings]:
Lord Underhill Lord Underhill moved Amendment No. 41:
Page 19, line 39, leave out from ("give") to ("for") in line 40 and insert ("the Merchant Navy Training Board").
The noble Lord said: This clause deals with the financial assistance for the training of officers and crews in the merchant service. Clause 25(1) provides that financial assistance in respect of the cost of training may be given by the Secretary of State to any person or body of persons of any description determined by him. We seek from the Minister some clarification as to what that may mean. In our view, public money should be dispensed by public agencies and not by any charities or by quasi-professional bodies.
When one refers to the Second Reading on 10th November one gets a feeling that there were suggestions that a charity might be involved. We consider it absolutely illogical to involve a charity by way of a careers advisory service because we believe that is the job of industry, the principal parties being the employers and the employees.
I understand that the Merchant Navy Training Board is an industry-funded institution which could perform this function if adequate resources were made available to it. The hoard is composed of employers, employers' representatives, representatives of the Department of Transport, of the Department of Education and Science and education and college interests. That is why in this amendment we propose to delete reference to any person or body of persons of any description determined by the

583
Secretary of State and to put the responsibility on the Merchant Navy Training Board.
The Minister very helpfully gave us some figures of the actual assistance to be given in 1988–89 and in 1989–90. I wonder whether the Minister is in a position to indicate the Government's thoughts as to what proportion of costs borne by the employer will be met by the department. Can the Minister also tell us what proportion of the money available will be used to relieve training costs to employers? The Government must have some proportions in mind in determining the actual figures of assistance. I shall be grateful if the Minister can help on those two points. Meanwhile, I ask leave to move also Amendment No. 42 because it is merely a consequential amendment.
The Earl of Inchcape: I welcome Clause 25, which will provide very useful aid to the shipping industry. All aid for training is welcome when times are hard and all expenditure that is not vital to the running of a ship has to be cut back. In the short term training is not vital and times have been very hard. Now there is a growing shortage of trained officers coming through and this aid should stimulate increased training efforts by companies.
Lord Mottistone: There is a small point I wish to raise purely for clarification. As I remember it from my training board days, the Merchant Navy Training Board was a voluntary one. It was not established by statute. I imagine that with the passage of time, if it so suited the shipping industry, who support it and who created it, to wind it up and this amendment went through, then we would be lost as to who should be given the financial assistance.
It seems to me that the present wording of the Bill provides for "any body", which could be the Merchant Navy Training Board. I hope and expect it to be so as long as that body exists. Surely in statute one needs to be sufficiently broad to take care of eventualities.
Lord Greenway: In following the noble Earl, Lord Inchcape, I should like to add a word of welcome for this clause. As I understand it, it is a general, enabling clause. The exact intentions of the Government have not yet been made clear.
Training is one of the crucial elements, as I see it, for the continuance of a strong merchant navy in this country. I think there are many matters which have to be taken into account, and many different organisations have to be consulted. The clause is a welcome addition.
Lord Brabazon of Tara: We are all agreed on the importance of training to the industry. That was made clear on Second Reading, and indeed again by my noble friends and the noble Lord opposite this afternoon.
This clause contains enabling powers to allow the Government to provide assistance with training. These powers have deliberately been cast in a generalised form to allow a degree of flexibility in the way in which the assistance is to be provided. Noble Lords will be aware that, with all interested parties,
584
we are developing a scheme to provide this assistance. The details, including how the assistance is to be channelled to recipients, have yet to be settled. I am afraid that I have nothing further to say to the noble Lord, Lord Underhill, beyond what I said on Second Reading when I gave the amounts of money available next year and the year after.
I cannot at present say what proportion of training costs will be met by this assistance. However, the intention is to provide those who employ and sponsor trainees with an incentive to increase the number of cadets taken on. The power in the clause, as drafted, would enable this assistance to be provided to any person or body of persons that the Secretary of State may determine. Of course, this would include the Merchant Navy Training Board. I am not convinced that the board would be a suitable recipient and certainly not the sole recipient. The MNTB's main function is to establish the content of training. It does not carry out any training and does not take on any cadets. If our assistance is to be effective in increasing the number of cadets being trained, the assistance must be channelled to those who take on cadets and who currently bear the cost of the training. We are looking at different ways in which the assistance might be channelled to them. However, this would be an administrative executive function and the MNTB is unlikely to be an appropriate organisation for such a task.
The noble Lord, Lord Underhill, mentioned that a charity might be given some of the money to distribute. That was referred to on Second Reading; and, indeed, we hope that that particular charity, the Marine Society, may be ready to help with publicity for the scheme, but I do not believe that it has been suggested—and we are not now suggesting—that it might act as agent in dispersing the grants. I believe I can allay the noble Lord's fears on that point.
I believe that the way we propose to administer this will he the best way; in other words, by paying the money to people actually involved in the training. The amendment proposed would be very restrictive and would inhibit the Government's ability to provide assistance with the training of seafarers—assistance which we are all agreed is worth while and necessary.
I hope that the explanation I have given—even if I have not been able to go into more detail than on Second Reading—will enable the noble Lord to feel that we are going about it in the best way.
Lord Underhill: I am grateful to the Minister for what he said, in particular his assurance that there is no intention that a charitable body as such will be used for the actual administration of the grants. There is no difference between us and other noble Lords in the House. The fact that a proportion of the training costs is to be met by the Government is a very useful addition to the merchant shipping industry. We are all in agreement that that is a very useful provision.
I shall seek further advice on what has been said about the Merchant Navy Training Board. I may come back to it on Report, depending on the advice

585
I receive, but meanwhile I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendment No. 42 not moved.]
Lord Underhill Lord Underhill moved Amendment No. 43:
Page 20, line 4, at end insert—
("( ) The financial assistance provided for in subsection (1) above shall be granted only to British citizens serving on ships manned by masters and officers holding a United Kingdom certificate of competence.").
The noble Lord said: There are two principles in Amendment No. 43. The amendment provides that any financial assistance should be granted only to British citizens serving on ships which have been manned by masters and officers holding a UK certificate of competence.
The first principle of course is that training should be given only to British citizens and on Second Reading the Minister said:
"It will be essential for proper supervision of the training programme for training to be carried out on ships manned by senior officers holding United Kingdom certificates".
We had in mind to add to our amendment that training should be given only on UK-registered ships; but the Minister continued in his reply—and I quote from the same column:
"I naturally hope that most of the training will be done on United Kingdom registered ships, but we would not want to rule out the possibility of training on other ships with United Kingdom certificated officers".— [Official Report, 10/11/87; col. 1329.]
We have accepted that argument put forward by the Minister and that is why the amendment is in its limited form. We hope that it will meet the Minister's approval and that he will accept it.
Lord Mottistone: In practice, most of those receiving financial assistance are likely to be British citizens and will be serving on ships manned by masters and officers holding a UK certificate of competence. However, nationals of the Republic of Ireland and some Commonwealth countries are also entitled to obtain UK certificates of competence or have their national certificates of competence recognised by the UK. This clause would prevent assistance being given to a cadet resident in the UK who happened to be an Irish national or to trainees serving on ships, any one of whose officers happened to hold an Irish or Commonwealth certificate of competence. I suggest that this clause therefore becomes unnecessarily inflexible.
Lord Brabazon of Tara: As drafted, this amendment would mean that funding in respect of Merchant Navy training could be provided only to British citizens serving on ships manned by UK certificated officers. As I have already explained, our intention at present is to provide financial assistance to those organisations—primarily shipping companies—who sponsor and employ cadets, rather than to the cadets themselves. The amendment would prevent that. But from the comments made by the noble Lord, Lord Underhill, I understand that the intention behind the amendment is to limit the assistance to costs incurred by companies in respect of the training of British citizens on ships manned by
586
UK certificated officers. I appreciate that there may be a case for placing a restriction on the nationality of trainees, although I am not sure that this needs to be done by statute. I am however willing to consider whether it would be possible or appropriate to incorporate such a restriction in the Bill, though I bear in mind what my noble friend Lord Mottistone said on this point.
I am less convinced of the need for a statutory restriction as to the certification of officers. As I explained on Second Reading, it is certainly our intention that training should be carried out on ships with senior officers holding UK certificates. But I would not want to rule out the possibility that junior officers might hold equivalent non-UK certificates. Nor do I think that we should rule out the possibility that in certain special cases exceptions might be made to allow training in other ships. I think therefore that it is important that an element of flexibility should be maintained—the point made by my noble friend Lord Mottistone. Restrictions on the manning of vessels used for training can always be imposed administratively and it should not be necessary to enshrine them in primary legislation. Therefore, with those remarks and the assurance that I should like to look again at the first point made by the noble Lord, Lord Underhill, I hope that he will feel able to withdraw the amendment.
Lord Underhill: I readily do so and I am grateful to the Minister for agreeing to look again at the first part of my amendment. We shall look carefully at the second part and also at the point raised by the noble Lord, Lord Mottistone. That was drawn to my attention after the amendment was put down. It is obviously a point of some importance. I welcome the Minister's assurance that he will look again at the first matter and I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Lord Underhill Lord Underhill moved Amendment No. 44:
Page 20, line 5, leave out ("or a loan or otherwise").
The noble Lord said: This is a probing amendment. We cannot understand why the words,
"grant or a loan or otherwise",
should appear and we are proposing to leave out the words,
"or a loan or otherwise".
If it is to be of assistance to the merchant shipping industry, surely it must be a grant.
I do not know what "otherwise" could be. If one is giving a grant it is to assist the industry and everyone agrees that every little help is welcome, but a loan is taken back. Incidentally, subsection (2) states that,
"the Secretary of State may impose such conditions as he thinks fit".
What are the conditions he may wish to lay down in giving a grant? The main point which I think everyone has welcomed in this clause is that not only will it assist the numbers being trained but it will also be of some limited financial help to the merchant shipping industry. The amendment confines itself merely to leaving out the words,
"or a loan or otherwise".
I beg to move.
6 p.m.
Lord Brabazon of Tara: As I explained on the previous amendment, the powers have deliberately been widely drawn to allow sufficient flexibility in the administering of the assistance scheme which is being developed. In practice I would certainly expect the financial assistance towards seafaring training to be provided in the form of grant. However, I do not think that we should rule out the possibility that other forms of funding might also be appropriate. For this reason it is important that the present flexibility should be maintained.
I am informed that the form of words used in this clause is fairly standard in legislation. That is probably why we have used it again here. However, as I have said, we would certainly expect the assistance to be provided in the form of grants, but we would not want to rule out the possibility of other means as well if that seemed to be appropriate at the time.
Lord Underhill: I understand the desire for flexibility and using the word "otherwise", but I am afraid the Minister has not explained why we need the words "or a loan". I am certain that is not the usual provision when we are talking about giving grants to any bodies or industry. It is the word "loan" that particularly worries us. To give a grant but to say that a body will pay it back hardly seems to be helping the merchant industry. That surely is carrying flexibility a bit too far. Nevertheless I will read carefully what the Minister has said. I have no doubt we will come back on this question of the loan at the next stage. In the meanwhile, I beg leave to withdraw.
Amendment, by leave, withdrawn.
On Question, Whether Clause 25 shall stand part of the Bill?
Lord Underhill: I should like to raise a point here. I recognise I should have given the Minister notice that I was going to ask this. On these matters we not only welcome the briefing that we are given by the General Council of British Shipping, but also the advice which we receive from the National Union of Seamen, and from NUMAS, the officers' union. NUMAS is concerned with one particular matter. I put this in the form of a request to the Minister. Will he confirm that officers studying for higher grade certificates of competency will receive assistance towards meeting the costs involved? Many officers are not covered by industrial arrangements providing for study leave. Alternative entry and course arrangements mean that many officers do not gain exemptions from academic subjects, hence the time ashore, college fees and examination fees are costly. Assistance at the entry and training stage should be carried through to higher certificate levels if the Government aim to achieve availability of sufficient qualified officers is to be fulfilled.
NUMAS are paticularly worried about this aspect. I will readily understand if the Minister feels that he must write to me. Perhaps he can give an answer to this matter now. He has done so very well on other
588
occasions, and it looks as though he might be able to do so now.
Lord Brabazon of Tara: I am able to answer without taking advice. Our primary priority is of course to tackle the shortage of cadets. But I certainly would not rule out the possibility of assistance for officers training for higher qualifications, and of course the powers in the Bill will allow for this. I hope that goes some way to meeting the noble Lord's concern.
Clause 25 agreed to.
Clause 26 [Financial Assistance in respect of crew relief costs]:
Lord Carmichael of Kelvingrove Lord Carmichael of Kelvingrove moved Amendment No. 45:
Page 20, line 31, leave out ("or a loan or otherwise").
The noble Lord said: This is not, as it may appear, the same as the previous amendment merely because the words are the same. However in the context it appears to me to be quite different. Here we are talking about the relief costs for crews coming from other parts of the world on leave. Therefore it does appear that the cost will be known well in advance, and the crew should be given a note or understand exactly how much is going to be paid—what proportion—regarding the cost of their getting back to the UK. That should be known and told to them. Therefore the question of having a loan involved in it seems to be quite unnecessary. I hope the Minister will agree this is a small point. The Minister is still left with a fair amount of flexibility; but at least a crew member should know exactly the repatriation cost to this country. I beg to move.
The Earl of Inchcape: I should like to welcome this clause as an aid for the industry. Repatriation costs will particularly help companies whose ships are permanently trading abroad. Crews have to be repatriated for leave every four to six months. Costs of flying them back from, say, Japan or Australia and flying crew replacements out to the ship is very substantial. As in the previous case, how the Government's scheme will work still has to be explained to the industry. In principle, this clause will provide help similar to that provided for many years to Norwegian, Danish and Swedish owners by their governments.
The Minister will not be surprised, however, if I warn him that these measures alone will not be enough to stop the decline of the UK-owned fleet. Indeed, the industry is disappointed that the repatriation aid has not been extended to British subjects serving on UK-owned British ships registered in the dependent territories such as Gibraltar or Bermuda. These ships are required by law to carry British senior officers. We cannot see why they should be excluded. Despite that grumble, I welcome this clause. It is useful in its own right so far as it goes.
Lord Brabazon of Tara: My answer to this amendment is really going to be very similar to that

589
on the previous one of the noble Lord, Lord Underhill. The amendment is of course very similar as well.
What we are trying to do here is to allow flexibility for the development of the arrangements for providing assistance with crew leave costs which are currently under consideration. I make one point. I think the noble Lord opposite may have a slight misunderstanding. The money will be paid to the shipping companies, not to the crew members. It will be the shipping companies who receive this subsidy towards flying the crews backwards and forwards, not the individual crew members. They are of course entitled to be flown back at the intervals which are specified in their contracts; so they have to be flown back anyway. It is a question of helping the company with their costs. It is not meant to be a means for the crew members to ask for more trips home in a given year. I think I ought to make that clear.
It is our intention that the assistance should be made available in the form of grants. As I said on the last amendment, we should like to have the possibility of flexibility should another form of financing be more appropriate. As I have said, the intention is to give grants, but it might be that at some time in the future another form of financing was more appropriate.
My noble friend Lord Inchcape, to whom I am grateful for his remarks about the clause so far as it goes, asked why the assistance would not be available for vessels registered in the dependent territories. We have looked closely at this, and we had to conclude that there would be difficulties of administration and accountability in extending the scheme to cover such ships. I am also not sure that it would be an appropriate use of British taxpayers' money to support dependent territory shipping in this way. So it is to be restricted to British, UK and Crown dependency registers at the moment.
Lord Carmichael of Kelvingrove: I thank the Minister for that reply. I am glad that he mentioned accountability. How the money would be lent and how it would he accounted for was causing us some concern. The Minister rightly said that the money would be payable to the company. There will be a transfer from the company to the officers and crew who are being returned. There are a few points in his answer that need looking into; but, in the meantime, I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Lord Carmichael of Kelvingrove Lord Carmichael of Kelvingrove moved Amendment No. 46:
Page 20, line 40, at end insert—
("(5) Only shipowners and crew who are liable to pay United Kingdom tax may benefit from the provisions of this section.").
The noble Lord said: From what the Minister said towards the end of his previous remarks, he should agree with this proposal. He made it clear that the Government's object was not to help Commonwealth countries' crews but to help British crews. The amendment merely asks that only shipowners and crews who are liable to pay United Kingdom tax benefit from this clause which gives relief for the
590
repatriation on holiday of British crews. I am sure that the Minister will be only too pleased to approve of the amendment or to take it away for consideration. I beg to move.
Lord Mottistone: In practice, the only shipowners who would benefit from the provision are those who are tax-resident in the United Kingdom. Some of their crew may not be tax-resident in the United Kingdom. However, the crew agreement may still require them to be repatriated to the United Kingdom before they make their own way to their homes in, say, Ireland or the Channel Islands.
I am interested to see that Clause 51 provides:
"'Relevant overseas territory' means—

(a) the Isle of Man,

(b) any of the Channel Islands, or

(c) any colony".

The wording makes them sound thoroughly un-British. It would be unreasonable for the amount of assistance to the company to depend upon the personal tax arrangements of its crew, over which it has no control and which are not relevant to their suitability for employment. I hope that noble Lords opposite will take that point into account.
Lord Brabazon of Tara: I appreciate the intention behind the amendment of the noble Lord, Lord Carmichael. There must of course be some restriction on those who may benefit from the assistance which the Government will be providing under this clause. Our intention is that the restrictions should be twofold—a restriction on the place of registration of the vessel, and restrictions on the crew members in respect of which crew relief costs will be made available. The restriction on registration is in Clause 26(1)(a), which makes it clear that the ship must be registered in the British Islands. This means that under Part I of the Bill the shipowner will have to be a person or company eligible to register a ship in the British Islands; that is, the United Kingdom, Channel Islands or the Isle of Man.
Subsection (2) provides the powers which enable the Secretary of State to impose conditions on eligibility. As I said on Second Reading our intention is to limit the assistance for crew changes in respect of crew members ordinarily resident (and therefore paying tax) in the British Isles. This goes slightly wider than the limitations proposed in the noble Lord's amendment. But the effect of this amendment would be to exclude seafarers resident in the Irish Republic, the Isle of Man, and the Channel Isles, as my noble friend Lord Mottistone pointed out, and I am sure that this would be unfair recognition of the part that these seafarers have played and still play in the Merchant Navy in peace and war.
I hope therefore that the noble Lord, Lord Carmichael, will agree that the restrictions we intend to impose strike the right balance and that, in view of the explanation I have given, he will be able to withdraw his amendment.
6.15 p.m.
Lord Carmichael of Kelvingrove: It was always going to prove difficult to achieve an all-embracing amendment when we have to consider Ireland, the

591
Channel Islands and the Isle of Man. From what he said, the Minister accepts the idea of and the intention behind the amendment. With the explanation that he has given, and with the safeguards embodied in the clause, I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
On Question, Whether Clause 26 shall stand part of the Bill?
Lord Geddes: I should like to ask my noble friend one question. He kindly gave us the definition of "British Islands" when he spoke to Amendment No. 46. I understood him to say that it was the United Kingdom, the Channel Islands and the Isle of Man. Will he be kind enough to advise the Committee where that expression is so defined? It is not a familiar one.
Lord Brabazon of Tara: I am not sure where it is defined. The "British Islands" are the Channel Islands and the Isle of Man. They are normally known as Crown dependencies. I cannot read what my note says; but the definition comes from a well-known Act of 1978.
Clause 26 agreed to.
Clause 27 [Establishment of the Merchant Navy Reserve]:
Lord Carmichael of Kelvingrove Lord Carmichael of Kelvingrove moved Amendment No. 47:
Page 21, line 16, at end insert ("; but no such regulations shall be made unless a draft of them has been laid before Parliament and approved by resolution of each House.").
The noble Lord said: It may be convenient to speak also to Amendment No. 48. This is not the usual amendment where the Opposition always want positive resolution rather than negative resolution. The clause contains highly specialised subjects. They require an informed briefing, and it is therefore important that we are told well before the regulations are presented to this place for ratification so that they can be debated properly.
If the Minister looks at the contents of the regulations that can be made, he will see that they are important and should be debated by this place and not merely put through late at night or in a batch. I hope that the Minister will give this matter serious consideration. It is not merely the Opposition asking that we waste time. We think it is an important matter. I beg to move.
Lord Brabazon of Tara: As I said in answer to an earlier amendment moved by the noble Lord, Lord Underhill, all regulations under the Bill with respect to conditions of service of members of the Merchant Navy Reserve would be subject to parliamentary approval under the negative resolution procedure. I appreciate that many of these regulations are important and may well warrant debate both here and in the other place. But negative resolution procedures does not rule this out and I am not convinced that affirmative resolution procedure
592
would be justified in all cases. I doubt whether minor regulations on, for example, the uniforms of reservists would necessarily require debate in both places but the effect of this amendment would be to make such debates unavoidable. I hope that the Committee will agree that the Bill as drafted provides the necessary flexibility by allowing for parliamentary scrutiny and debate of regulations, if this is thought necessary, while avoiding unnecessary demands on parliamentary time.
Lord Boyd-Carpenter: Is not the advantage of the negative procedure in this case that only those regulations in which someone is sufficiently interested to put down a Prayer would be debated; whereas, if the amendment is accepted, all the regulations, some important and some unimportant, would have to take up parliamentary time by being formally moved? The negative procedure is much more selective, and I should have thought for the purpose of achieving parliamentary control over delegated legislation, much the more effective.
Lord Underhill: I wish to say a word before my noble friend decides what he is going to do about the amendment. Amendment No. 47 contains important items. Although uniform and equipment have been referred to, sub-paragraph (a) refers to call-out notices to be served on members of the reserve. The clause also provides for regulating the conduct and discipline of members. That is an important item. The imposition of fines or the forfeiture of pay are also important issues. This place should discuss such important matters by affirmative resolution. Amendment No. 48 also deals with fines. That is why the amendments are put forward. They are not normal run-of-the-mill regulations but vital regulations. We do not ask that every regulation under the Bill should be treated by the affirmative procedure, but these are important with regard to the Merchant Navy Reserve.
Lord Boyd-Carpenter: While no one disputes that some regulations under the clause are very important, will the noble Lord not face the fact that a great many are not? If we leave it as negative, any noble Lord by putting down a Prayer can have debated regulations that he thinks are important. If we make it affirmative, all of them have to be put through and debated although many may be trivial. This is surely a waste of time.
Lord Carmichael of Kelvingrove: I take the point that the noble Lord, Lord Boyd-Carptenter, has made. I have always found it difficult to have prayers accepted. They are sometimes difficult, particularly in the other place when one's own Whips are twisting one's arm at the same time. I therefore believe that the affirmative resolution is more appropriate. However, this is not the time to push the matter to a Division. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendment No. 48 not moved.]
Lord Carmichael of Kelvingrove Lord Carmichael of Kelvingrove moved Amendment No. 49:
Page 21, line 33, at end insert—
("( ) Section 102 of the Merchant Shipping Act 1894 (Colonial certificates of competency) is repealed.").
The noble Lord said: I hope that the Minister will accept the amendment. I suppose that it is quite historic. Its aim is to repeal Section 102 of the Merchant Shipping Act 1894, which requires the authority to recognise by Order in Council the Commonwealth certificate of competency. The influx of officers from parts of the Commonwealth in the last few years surely undermines the efforts by means of Clauses 25 and 26 to train and have available qualified UK officers for defence and strategic purposes. Commonwealth officers would not have allegiance to the United Kingdom in time of tension to the same extent that UK officers would.
One of the main purposes of the Bill is to build up our merchant marine reserve and officer corps. I therefore hope that the Minister will accept this fairly modest amendment. I beg to move.
Lord Brabazon of Tara: In fact it is not a question of accepting the amendment because Section 102 of the 1894 Act was repealed under provisions in the Merchant Shipping Act 1970. Perhaps I may go into a little of the background and reply to what the noble Lord has said about Commonwealth officers.
Section 102 was replaced by provisions in regulations under the 1970 Act on the certification of deck and engineer officers which allow the Secretary of State to recognise certificates issued by authorities in countries other than the United Kingdom. At present we recognise certificates issued by certain Commonweatlth administrations and the Irish Republic. Certification arrangements in these countries are historically modelled on our own, and my department maintains close links with the authorities in these countries. As a result their certification arrangements are broadly equivalent to our own. There is no reason on safety grounds therefore why we should not maintain mutual recognition arrangements with these countries. Moreover, many seafarers holding certificates from these countries have provided valuable service in our merchant fleet. To deny them the right to continue serving would be seen as an injustice and would certainly lead to retaliation from those countries whose certificates we no longer recognised. This would mean that British officers serving on Irish or Commonwealth ships under the reciprocal arrangements would no longer be able to do so.
I do not believe that the sort of changes underlying the proposed amendment would be in anyone's real interest. I hope that the noble Lord on reflection will realise that his argument is somewhat flawed. I was going on to say that I hoped that he would withdraw the amendment, but that is not appropriate in view of the fact that it is already in force, so to speak.
Lord Carmichael of Kelvingrove: I can see the flaw in the amendment. Instead of saying that I shall consider it, what I should be doing perhaps is to turn my mind to those who advised me on the point. I have no alternative but to beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Clause 27 agreed to.
Clause 28 agreed to.
Viscount Davidson: I beg to move that the House do now resume.
Moved accordingly, and, on Question, Motion agreed to.
House resumed.
House adjourned at twenty-five minutes past six o'clock.