Maritime Policy

HL Deb 17 December 2003 vol 655 cc1180-212

4.41 p.m.

The Earl

of Caithness rose to call attention to the opportunities to the United Kingdom that a comprehensive maritime policy would bring; and to move for Papers.

The noble Earl said: My Lords, as I am back in the maritime world, I must first declare my interest: I am an adviser to an American company that advises, among other things, on ports and the handling of freight.

This will be a wide-ranging debate, and I shall focus on three issues. The first is security. In December 2002, the International Maritime Organization adopted new regulations to enhance maritime security by adopting the International Ship and Port Facility Security Code, known as ISPS. The UK was involved in its construction, so there is no excuse that we did not know what was going to happen. The code comes into force on 1st July next year, only some six months away. How ready is the UK, with its tradition and reputation for high standards, to meet the challenge?

I will take shipping first. The international ship security certificate is essential, if a vessel is to trade. I understand that, so far, only two or three ships have been security certified out of a fleet of more than 500. Does the Minister believe that the Maritime and Coastguard Agency has the resources and expertise to complete the work in time? Can he tell me what happens if a British flag vessel is searched under port state control powers and the certificate is found to be flawed? Will the Government, who are responsible through the MCA for issuing the certificate, compensate the businesses, shippers, insurers and ship owners who will suffer financially from such a situation?

At ports, a different organisation—Transec— carries out the validations to ensure that ports comply with the code. The Government have a direct responsibility for port facilities, each of which must be assessed to comply with the new standards in the next six months. If they do not comply, or their compliance is fudged, overseas shippers, the insurance industry and marine financing will lose confidence in British ports, and our maritime trade will suffer grievously.

There is a great deal of concern among port facility operators, who have been told by Transec to do nothing until they are inspected. Many are still waiting, and there is precious little time for them to make good any recommendations. In contrast, the port of Antwerp is, with 130 port facilities—and, in fact, all the ports in Belgium are—well ahead in terms of preparation and compliance. The later the inspections are left, the less negotiating power operators will have with suppliers because of time constraints and because so many of them will want the same equipment by a certain date. Prices will inevitably rise, and the consumer will be penalised. Is it not the case that the Government have severely underestimated the resources and capabilities needed to carry out such vital work? Why have the Government not issued clear guidance and a timetable to port operators in the past 12 months? Why have the Government not delegated the inspection of both ships and ports to the private sector?

We all saw the consequences for Pan Am of the tragic events over Lockerbie, involving Pan Am flight 103. The Government are playing fast and loose with Britain's reputation, Britain's fleet and Britain's financial and insurance institutions on a matter as important as security.

I turn briefly to ocean liners. The conferences of the past have been replaced by discussion arrangements, but operators are allowed to co-ordinate sailings and landside activities. They are still protected through EC regulation 4056/86, which gives them anti-trust immunity. That is under discussion again in Brussels, and I would like the Minister to tell us what the UK's position is. Does he not agree that it is time to forbid that anomaly and to bring them into the real world in which others operate, for the benefit of our industry and commerce?

I move on to a key missing ingredient of maritime policy for the UK: how to react to the opportunities that increased containerisation has brought. Transport policy is heavily geared to road and railways, with aviation increasingly mentioned. When do we hear the words "maritime policy" spoken, let alone hear a policy enunciated? The Government's policy in the transport 10-year plan, published in 2000, proposed a target figure of £180 billion in public and private sector investment over the decade from 2001–02 to 2010–11. It is an interesting document, but it says nothing about the maritime sector. Our lifeline transport sector is the pariah, when it comes to policy. A comprehensive policy is vital to the UK. It has been made harder to achieve—but not impossible—by devolution, as responsibility for the ports has, basically, been devolved although shipping policy remains with the UK Government. Any policy must include both.

Why is a policy necessary? We are unlike any other major economy in that about 95 per cent of our trade by weight arrives or leaves by ship. Two thirds of seaborne trade is containerised. Thus, every one of us is affected every day of our life by that dependence on the sea. However, as long as there are goods in the shops when we want them, few people care. There is a growing realisation that that laissez-faire attitude is no longer acceptable. Among those who feel that more should be done are those who came together recently to form the Scottish Shipping Initiative, of which I have the honour to be the honorary patron. Its recent conference brought together a wide range of interests to consider the way ahead, as well as the problems and the opportunities facing us.

There are two relatively recent government publications concerning the maritime sector: British shipping: Charting a new course and Modern ports: A UK policy. They are glitzy titles for papers that produce little that is new and show how blinkered the Government are by old-fashioned institutional thinking. I admit that I thought the same when I was Minister of Shipping 10 years ago, so what has happened since then to make me change my mind? I suggest five factors. Then, ocean liners dominated discussion of ocean shipping. Shippers saw the industry as run by cartels and anti-competitive. Change started when the Ocean Shipping Reform Act, which undermined carrier conferences, became law in the United States in 1998. In addition, the European Shippers' Council and others interested in the movement of goods, have been pushing for—and obtaining—some reform through the European Commission.

Secondly, due mostly to that economic dynamo, China, world container traffic has been growing at 8 to 10 per cent per annum over the past decade, and that looks set to continue. That has changed and will continue to change the size of ships, which, 10 years ago, carried a maximum of 4,000 TEU containers but now carry 8,000. Only two ports in the UK, Felixstowe and Southampton, can handle such big vessels, and they need high tides to do so. However, those ports are already congested and out of capacity.

Fourthly, there is an allocation of EU money to assist short sea initiatives and ports, but the Government will not apply for it. Fifthly, the Government have changed the emphasis of their policy from competition and deregulation to sustainability, environmental protection, integration between modes and improved regional and local guidelines. The aim of sustainable distribution was expressed as follows: To ensure the future development of the distribution industry does not compromise the future needs of our society, economy and environment". They are fine words, which I applaud, but no action. However, a maritime policy is just the ingredient that the Government need to help them attain their objective.

What matters to our manufacturers and retailers is reliability of delivery. That is more important than speed and erratic timings. With Felixstowe and Southampton so congested, shippers cannot guarantee deliveries. Thus, extra costs are being built into the supply chain and inefficiencies created, for which the consumer pays. There is a distinct threat of congestion charging by the shipping lines for visiting ports in the south-east. It is no longer fanciful to envisage the UK having to rely entirely on feeder services from continental Europe to supply our import and export traffic as shipping lines are already moving to continental ports.

If that trend grows, the Government will be guilty of letting Britain lose its place in world trade. Let us not forget that from being a world leader, the UK does not have representation in ownership of the top containerised shipping lines other than the Anglo-Dutch carrier P&O/Nedlloyd, and that is up for sale.

We rely too heavily on lorries to move containers on our roads that are increasingly congested. The cost to move a container by road is up to £1.50 per mile. That will increase as working hours directives continue to limit drivers' hours. Given that, it is inevitable that the cost of running a business increases the further one is away from Felixstowe and Southampton. A container costs about £150 more to deliver to the central belt of Scotland than to the south-east of England. That sum increases to about £350 to move it to Caithness. Our businesses are being penalised due to the current policy.

So could we do better by rail? A little, but not much. Our rail system is designed for passengers, not freight. It would be political suicide for the Government to give freight preference over passengers. Just imagine the headlines if passengers had to wait many hours, if not days, as containers do now at Southampton, to be allowed to use the sparse number of rail services. Later in the supply chain they usually end up on roads, as few British manufacturers have a policy to rail connect their factories.

How can we overcome that dilemma? In order to ease the congestion, Southampton has submitted a planning application at Dibden Bay and there is an application for a London gateway port that will require at least tens of millions of pounds to be spent on dredging alone in order to accommodate the new vessels. Further applications are likely at Harwich and Felixstowe. However, even if the capacity constraints are alleviated in the south-east, the main problem will not go away. We will just have even more containers arriving at the same time to go on to lorries and to create even more congestion. A compounding factor is the shortage of HGV drivers. We are 50,000 drivers short, but that is not just a UK problem. It is a growing world-wide problem. So that most vital of matters to our businesses—reliability of timing—will just get worse, as will noise and pollution.

So what is the alternative? The Government must become proactive. The private sector alone cannot, nor should not, be relied on to safeguard the interests of UK plc. We do not allow it for road and rail, so why in the maritime sector? We have to look for realistic alternatives to keep our position and freedom to trade outside of the EU by ensuring that our ports can support the bulk of our industry, which is in the Midlands and the north of the country. By introducing bigger ports in those regions, we can lower our inbound and outbound transport costs, which will help to make us more competitive in world markets.

The UK is unique in its attitude to ports. We have private ports, trust ports and local authority ports, none of which gets taxpayers' help. On the Continent, that is unheard of and they think that we are crazy. They are right. Their governments help their ports in the same way as their roads and railways. Can one seriously imagine Antwerp, Rotterdam, Le Havre and Hamburg not receiving financial aid? Part of the reason that they do so is due to their strategic importance to their countries. How much more that logic applies to us where we have no land borders.

Given our island status, the number of ports that we have, the changes in shipping patterns, the congestion on our road and rail systems, with the environmental damage that causes, and the subsidised competition in Europe, is it right to let Hutchison, ABP and P&O in the overcrowded south-east or Hunterston and Scapa Flow in Scotland slog it out to try to provide the container capacity that we need, without a sensible framework in which to operate? We need the Scottish Executive and the UK Government to agree that in future the major container ports will be primarily transhipment terminals for short sea shipping. That is often seen as just relating to the minor bulks, such as gravel and small tankers.

However, at Felixstowe, it is estimated that 35 per cent of container trade is already transhipped. EU and taxpayers' money will have to be spent at a number of feeder ports so that they can readjust their business, but that money would be better utilised there than the huge amounts that are being spent on the roads. Not only will such a policy mean that our goods are moved more reliably, cost effectively and in a more environmentally friendly way, but it will also bring benefits to our economy, as we can be the gateway to service Europe's needs.

There are a large number of ports in Scandinavia, Russia and northern Europe to which the modern vessels cannot gain access. Due to our geographical location, we, rather than our continental competitors, can be the hub for them. We are blessed with natural deep-water facilities without having to dredge and these should be utilised for the benefit of UK plc. That requires a complete rethink in the Government's strategy, but if the Minister is serious in wishing to minimise congestion, reduce the freight intensity of economic growth, make better use of transport infrastructure, minimise pollution and greenhouse gas emissions and reduce noise and disturbance from freight movements—all laudable Government objectives—the only way forward is through a short sea and coastal distribution policy with modern vessels like the "fast ferries" that are used in the Baltic. We would then start to reduce the long-standing market distortions created and perpetuated through ongoing public sector investment of land transport infrastructure with maritime transport virtually excluded from the public funding process.

I know that the Minister cannot possibly comment on the planning applications before the Government. I would not expect him to and that is not what I want anyway. I want a radical rethink on the whole subject and for the Government to have a vision for the UK by seizing this opportunity to chart a new way forward. In the UK's transport policy, ports are the essential links. The Government's policy makes them the weakest link. I beg to move for Papers.

4.57 p.m.

Lord Clinton-Davis

My Lords, it is quite a long time since I was on the Opposition Benches as the transport spokesman. At that time, I had the pleasure of crossing swords with the noble Earl quite often, although not often enough. Little has changed. For the most part, the same old lags are still around.

Lord Berkeley

Speak for yourself!

Lord Clinton-Davis

My Lords, they were around about 15 years ago. My noble friend was then a very well researched supporter of mine, and he remains very well researched today. But I am sorry that the noble Earl was so curmudgeonly about the Government's shipping policy, particularly as he presided over an unprecedented collapse of British shipping when he was the Minister for shipping in the 1990s. Nevertheless, I am glad that he has promoted a debate about shipping today.

I should declare that between 1974 and 1979 I was Shipping Minister. In fact, I was Parliamentary Under-Secretary for Companies, Aviation and Shipping. Perhaps I was fortunate in not being the Parliamentary Under-Secretary for Companies, Aviation and Tourism, when I would have had the acronym of PUSSCAT. I was also the commissioner in Europe for, among other things, transport, which included shipping.

When I was the Minister responsible for shipping some 30 years ago, the merchant marine of this country was second only to the Greek merchant fleet. Today, although there has been some improvement so far as the merchant fleet is concerned, regrettably we are still not as strong as we were. In my submission, British merchant shipping matters—which include the skills, experience and expertise of our seamen and officers—are of great importance. However, nothing whatsoever was said by the noble Earl, Lord Caithness, about them. He said not a word, although I think that these matters are vitally important.

In November the Prime Minister, no less, acknowledged the significance to this island of shipping. But it is not possible to subtract from the position of our fleet the supply of maritime skills and experience to which I have alluded. Part and parcel of all that lies in the education that could be gleaned from maritime schools which, with government support, were an intrinsic part of the whole equation. Is it really too late to hope that, after so long, it might be possible to revive them?

What we have now is some repositioning of the strength of ships sailing under the Red Ensign, but we still operate under the handicap of not pursuing sufficiently the other objective which I have tried to outline. For virtually a decade we have had more ships and tonnage sailing under the Red Ensign—60 per cent more than in 1997—but despite that, we have fewer British seafarers. We have seen a reduction of as much as 10 per cent, although some may say that the percentage is even higher, since that year. The gap has been filled by foreign seafarers. More than three quarters of junior officers are foreign nationals. Only around half of all chief engineers and one third of ships' masters are British. I earnestly hope that the Government are far from satisfied with that situation and I should like to hear from the Minister how they propose to address it.

It is not sufficient to be able to laud the fact that there has been an increase in tonnage under the United Kingdom flag. What would happen in an emergency? We hope that one will never happen, but it may. Indeed, we do not plan our defence position on the thesis that "it may never occur". The skills exemplified by experienced seafarers are necessary. They are needed to maintain the safe operation of ships as they go about their duties at sea. They are necessary to ensure that maritime services and industries on land are able to function well. Let us never forget that overseas earnings are boosted by something like £1 billion a year by the efforts of those industries.

In my submission, merely to promote the value of the Red Ensign is insufficient. We have to secure the employment and skills of our seafarers, just as John Prescott, a good friend of mine, argued for five years ago when he launched the White Paper, Charting a new course, comprising some 33 policies to achieve those aims. That is why the Government must act now, before it is too late, in particular as regards the short-sea shipping sector. They must act in the light of the determination of P&O Ferries to cut jobs by no less than 60 per cent. Unhappily, it does not stop there. Shipping lines such as Global Marine Systems, IMT Gearbulk Lines, Hoverspeed, Fishers, Pacific Nuclear Transport, Golden Sun Cruises, DFDS Seaways and Maersk have made similar grisly announcements. More than 1,000 seafarers' jobs have gone.

Is there not something entirely inconsistent and odd about companies receiving benefits under the tonnage tax scheme feeling no obligation whatsoever to employ and train British seafarers? We have a clear duty to see to it that we enhance our maritime skills and increase our maritime resources. Are the present Government able and willing to reassure the nation on this score?

The noble Earl has performed a great service tonight. We do not often debate shipping, but in my view it is vitally important that we do so.

5.8 p.m.

Lord Moynihan

My Lords, I congratulate my noble friend Lord Caithness on securing this debate in the ballot, the more so since he succeeded in being drawn from the hat in competition with my Motion on sport and recreation policy. Nevertheless, through his ingenuity of specifying "maritime" as opposed to shipping policy, I find myself in the fortunate position of being in order when addressing your Lordships on the subject of sport and recreational activity in our coastal waters around the United Kingdom.

I do so because the level of sporting use of the sea is low for a country with such a remarkable resource available to so many people living in our seaside towns. Indeed, the challenges faced by clubs, schools and governing bodies seeking to use our coastal waters are considerable. Real opportunity is to be found in a very special relationship—the co-operation demonstrated between schools, governing bodies, clubs and local authorities in our seaside towns and their catchment areas. The need to recognise the sea as a major sporting resource is all the more important given that the level of participation in sport and recreation is, according to my research and relative to the size of the population, lower than it has ever been in the recorded history of the past 200 years.

In a Parliamentary Answer 10 days ago, the Government admitted that they are overseeing a generation in our schools where participation in school sport has declined to the position where barely a third of our five to 16 year-olds spend a minimum two hours on PE and school sport. That is not two hours a day; it is two hours each week. No wonder we face the problem of obesity.

I call on the Government to introduce a new national coastal sports policy to transform participation among our schoolchildren living by the sea through the direct co-operation of clubs, governing bodies, local authorities and schools.

But today's debate goes wider than schools for there are in the United Kingdom a number of sports which have a vested interest in the maritime policy adopted by the Government. Of these the most significant are angling and sailing. Angling has the highest participation of any sport in the United Kingdom. Sea angling alone has in excess of 1 million regular participants. Sailing and the other water sports which fall under the umbrella of the Royal Yachting Association, such as windsurfing and water-skiing, are also extremely popular both at recreational and competitive levels.

But we should not limit ourselves to these sports alone. The surfing community plays a very active and highly positive role both in community life through the Surf Life Saving Association of Great Britain and on the environmental front through organisations such as the commendable Surfers Against Sewage. Their concerns must not be overlooked, nor those of the coastal rowing clubs and the Channel Swimming Association, or any of the many smaller sporting associations and numerous local seaside-located clubs with a vested interest in maritime policy.

The perception in some quarters is that the Government are attempting to push aside or smother in red tape sports which are, by all accounts, net contributors to their local societies. I should like to address some of their concerns.

There are more than 350,000 active sailors throughout the United Kingdom. Consequently, the Royal Yachting Association has been held up consistently as an example of how a sport should be run. Minimal regulation, good organisation and responsible education programmes for participants have meant that sailing in the UK is in fine fettle. This is reflected both in participation levels and also in the regular success of sailors such as Ben Ainslie, Shirley Robertson and Iain Percy at World and Olympic levels. Furthermore, let us not forget the wonderful courage and achievements of Tracy Edwards and Ellen McArthur, to name but two.

There are, however, worrying signs emanating from the corridors of Whitehall. The Government are finding it hard to resist requiring the sport to adopt many additional legislative measures, increased taxation and bureaucracy—for example, automatic identification systems for recreational craft; light dues for pleasure boaters; compulsory testing and regulation of all vessels. For all the merits and overriding importance of health and safety measures—which no one on either side of the House doubts—they must be practical and reasonable. Britain has an outstanding recreational boating safety record. This record is maintained, by and large, by the Royal Yachting Association's comparative independence and its commitment to education. Governments past and present have consistently reiterated their support for the RYA policy of "education not legislation". I seek assurance that this policy will continue.

As I mentioned earlier, sea angling is immensely popular. The Government Strategy Unit estimates that its contribution to the economy—and largely to the coastal and rural economy—is more than £1 billion per year. The Labour Party appeared to recognise the significance of sea angling in its much vaunted Anglers' Charter published in 1997. Yet this year the National Federation of Sea Anglers has been largely ignored by government in discussions regarding the use of funds to promote participation. Surely a sport which brings so much to society should be rewarded and encouraged rather than sidelined?

From a political perspective, I should be interested to hear from the Minister whether discussions between Defra and the DCMS as to how recreational and commercial angling should be prioritised have been resolved. Where does the sport of sea angling fit best in the relationship between these two government departments and what steps are being taken to ensure greater co-operation between them on matters involving sea angling?

Surfing is one of the fastest-growing sports in the UK, with between a quarter of a million and half a million regular participants. Yet, despite this, the British Surfing Association has been unable to secure funding support except through hard fought yet admirable attempts to acquire limited sponsorship. However, if we are to look to increased participation from among local coastal communities, build links with schools and local authorities, ensure inclusion and encourage those youngsters who could be involved in maritime sports to do so rather than to drop out in our coastal towns, policy initiatives with government—from sea angling to sailing and surfing—should be reviewed and appropriate funding secured from the sports funding agencies.

The biggest issue that the British Surfing Association is facing at present concerns the licensing of surf schools. Currently anyone can set up a surf school, leaving the door open for unqualified instructors to put the safety of young holidaymakers at risk. The BSA is doing everything possible to prevent this from occurring. It has its own system of accreditation for qualified instructors and has successfully lobbied local authorities in Cornwall to introduce a licensing system. For this fine campaign it has received no support from government.

The Surf Life Saving Association of Great Britain is a great example of the good work being done by smaller sporting authorities around the country.

Lord Patten

My Lords, I am extremely grateful to my noble friend for pointing out to the House—and certainly educating me—that surfing, which is a growing and extremely popular sport, is particularly valuable in dealing with youngsters who suffer from problems of social exclusion in many of our seaside towns—where, as your Lordships will appreciate, there are considerable problems of poverty and not enough to do for youngsters, particularly during those long summer months.

Can my noble friend educate me a little further and suggest why the Government seem to be so biased against surfing and so disinclined to support such a popular and growing sport which promotes inclusion? Why are they being so exclusive towards it?

Lord Moynihan

My Lords, in replying, perhaps I may commend my noble friend. For many years now he has been passionately concerned about how we can get young people involved in wider participation in sport rather than only in elite development. What worries me about government policy in this context is that it seems to be heading in the wrong direction. The best example of that recently is the priority sports list, under which limited resources are going to a small number of big sports rather than to a wider base of support for the organisations to which I have referred.

My noble friend is right about many of our coastal towns. If one takes Brighton as an example—the Minister knows more about Brighton than anyone in the Chamber today—he will attest to the fact that in the locality where I live, between Folkestone and Hythe, there is huge deprivation in those communities, as there is in parts of Brighton and in Dover more than anywhere.

We need to engage with such youngsters and we have a fabulous resource with which to do so. We have in the sea a fabulous resource for sport and recreation to enable us to bring them off the streets—away from deprivation and away from a life without hope—and into sport. I am asking the Government today, in developing a policy for sports associated with the sea, to recognise this principle and to sit down with the local authorities, the clubs and the schools and to build hope for those youngsters through a policy which engages the clubs and governing bodies to which I have referred.

My noble friend intervened when I was referring to a good example—the Surf Life Saving Association of Great Britain. Not only does that organisation have many members and a strong local base of more than 80 clubs, it has also an important social role to play. Since 1964 it has made more than 22,000 rescues, saving at least 45 lives a year. It also trains the Royal National Lifeboat Institution beach rescue guards. It undertakes that function while at the same time being highly successful in elite competition. I pay tribute to the British surf life saving team; it is ranked fourth in the world. Rugby Union is not the only sport in which we have recently beaten Australia in Australia. At the 2003 European championships, the British surf life saving team also won 15 gold, nine silver and four bronze medals.

Yet despite all this work, including the social work that my noble friend's intervention led us to debate, and the elite performance of that sporting governing body, the SLSA has just been informed that its £22,000 of Exchequer funding has to be cut to £7,500. Furthermore, in 2005, Sport England will withdraw even this token donation because surf life saving, as I mentioned a moment ago, has been excluded from the priority sports list. I hope that your Lordships on all sides of the House will recognise that that is patently unacceptable.

Of paramount relevance, however, to all these sports and concerns is the quality of the water, in which more than 3 million water sports enthusiasts, excluding casual bathers, are expected to practise their activities. The cleanliness of sea water is currently regulated by the 1976 bathing water directive. Yet in too many areas, the levels of pollution are unsatisfactory and need addressing by the Government.

At least 5 million people in the United Kingdom use the sea to enjoy sport. The sports concerned all have a great deal to offer society, whether it be through improving the local economy, helping to keep fellow bathers safe, supporting education, inclusion and awareness programmes, and giving opportunities to young and older generations alike.

The concerns and requests made by governing bodies and brought to the attention of the House today are all eminently reasonable. All they ask for is due consideration from those government agencies vested with the responsibility to direct supporting functions to their activities. They want a closer, more productive relationship between the relevant government departments and agencies, reasonable respect for and recognition of their views and a clean, well maintained maritime environment in which to enjoy their pursuits.

Currently, the granting of these modest requests seems to be a lifetime away, and I urge the Government to take immediate steps to establish a new, comprehensive and, above all, fair policy for maritime sports in this country.

5.22 p.m.

Lord Boyce

My Lords, I also very much welcome the initiative of the noble Earl, Lord Caithness, in raising this important matter. It is very good to hear the word "maritime" in this House. It is an unfortunate fact that United Kingdom shipping and seafaring currently have a very low profile, especially away from coastal areas. It is easy for far too many to forget not just our maritime heritage but also the dependence on the sea that we still have today. So awareness of maritime issues can often be limited to a negative focus on loss of life and on pollution, which can quickly undermine the very positive outlook of our maritime community. This "sea blindness" masks the fact that the entire maritime industry is, and will continue to be, essential to the United Kingdom economy.

Facts and statistics underlining this dependence have already been bandied around, but let me add a couple more, possibly of a slightly more upbeat nature. The UK today boasts the largest maritime sector in Europe, with a turnover of £37 billion—twice the size of aerospace or agriculture—and employs some 250,000 people. The maritime sector makes a massive contribution to the economy. We have heard that 95 per cent of British imports and exports go by sea, while 50 million people travel from, to and around the UK by ferry each year. Each day there are more ship moves in the Dover Straits—the busiest in the world— than there are air traffic moves at Heathrow. London is the world centre for maritime financial and legal services, and the Royal Navy is the second strongest navy in the world.

I am sure that a comprehensive maritime policy would, in addition to other benefits, allow this "sea blindness" to be addressed coherently. It would be a policy with which I am sure the Ministry of Defence and the Royal Navy would wish to be associated.

The Royal Navy is, of course, charged with contributing to the promotion of international stability and freedom upon which our national security and prosperity depend. Given our dependence on sea trade, this involves, among other things, looking to the maintenance of the freedom of movement on the high seas as well as countering crime there.

The Ministry of Defence acts in concert with other government departments in exploring ways of combating crime on the high seas. It actively engages with national and international defence intelligence and maritime security communities, as well as commercial shipping and other organisations, to promote wider awareness, understanding and co-operation. It also produces the Worldwide Threat to Shipping report, which is published on the Internet.

It is for these high level reasons that I am sure the Royal Navy would have a clear interest in the theme and the outcome of this debate, but it might be helpful if I gave some practical examples of why this might be. Let me take the event of an unlawful act, where a Royal Navy warship would intervene if a UK entitled ship were involved, or if Her Majesty's Government had agreed to a request for assistance by the vessel's flag state of registry. The sort of incidents I am talking about might range from hostage-taking through the use of a maritime platform by terrorists as a means of transport to the employment of a vessel as a weapon, possibly of mass effect. Clearly, close co-operation with the maritime industry is essential if we are to be ready with the right sort of contingency plans, and actions, when required.

Let me turn to a wider geographical focus. If, in a particular region, the threat to merchant shipping has been determined to be sufficiently high, a system of escorting entitled merchant vessels by Royal Naval warships can be established, such as that which was introduced for Operation TELIC—the Iraqi operation—earlier this year. Indeed, there is particularly close co-operation in the Arabian Gulf, where the Royal Navy's maritime trade organisation, based in Dubai, provides a traffic advice service to assist in the safe passage of white shipping to and from the Gulf.

Of course, Operation TELIC was an important test of that organisation and also the United Kingdom's strategic lift. More than 139,000 linear metres of equipment were moved in 93 sailings over a two-month period, using a total of 64 ships. As I am sure your Lordships know, 95 per cent of all military equipment is moved by sea.

As I have implied, relationships between the merchant navy and the Royal Navy are strong. One of the closest is through the Ministry of Defence's links with the Chamber of Shipping, the trade association for British shipowners and ship managers. This is achieved primarily through two bodies. The first is the Shipping Defence Advisory Committee. This non-executive body, formed of Ministry of Defence and other government departments and British companies, aims to promote mutual understanding and take forward areas of common interest. Chaired by the Assistant Chief of Naval Staff, the committee provides a valuable opportunity for networking and allowing colleagues from industry and the MoD to work collaboratively on developing initiatives. The 59th annual meeting took place only three weeks ago; its key output was to facilitate closer integration across government on maritime security issues.

Equally importantly, the Assistant Chief of the Naval Staff is an ex officio member of the board of the Chamber of Shipping—a close and essential linkage that is highly valued by the Royal Navy. Incidentally, your Lordships will wish to be aware that the 2001 Shipping Defence Advisory Committee formulated a concept for promoting maritime issues on behalf of the entire industry. This work crystallised in a national campaign called Sea Vision UK, which was officially launched in January this year. The campaign aims to raise awareness of the importance of our maritime sector in terms of the wealth and defence of the country and to promote the wide range of exciting and challenging maritime careers available. That may help to answer the concerns of the noble Lord, Lord Clinton-Davis, about the relatively low numbers of British seafarers. The Royal Navy is a strong supporter of Sea Vision, and is closely engaged.

I would also like to mention SeaBritain 2005. At one time this was titled Year of the Sea, but now SeaBritain 2005 is a national maritime celebration with festivities and events taking place throughout the year to highlight the ways in which the sea touches all of our lives. Naturally, at its heart, is the Trafalgar festival 2005, the bicentennial commemoration of the great battle and Nelson. The SeaBritain 2005 team is working in close partnership with VisitBritain and Sea Vision UK, and it is still hoped that the highlight of the year will be an international fleet review in the Solent.

I mention all this because the Sea Vision campaign and SeaBritain 2005 would indeed be opportunities that could be exploited by a comprehensive maritime policy whether that covered pleasure or sporting activities on the sea or container ships.

Finally, I shall briefly cover one other area that could benefit from such a policy—that of navigational safety around our shores, a subject that is giving serious concern to Trinity House. I declare an interest, as I am a Younger Brother of Trinity House.

Sea traffic is busier than ever; I have mentioned the Dover Straits. Ships are deeper and going faster, with over-reliance on poorly integrated albeit clever technology through waters that are restricting shipping patterns and increasing safety problems because of the wind and wave farms being built in navigable seaways. A comprehensive maritime policy could provide impetus to address properly such issues as the need for an integrated monitoring organisation in our complex offshore environment, or to raise watch-keeping standards and knowledge. I fully support the need for a comprehensive maritime policy.

5.30 p.m.

Lord Berkeley

My Lords, I also congratulate the noble Earl on securing the debate. It is a very wide subject, covering a wide range of different issues, but I shall cover the questions of maritime policy and enforcement—or lack of.

The noble and gallant Lord, Lord Boyce, referred in closing to the difficulties of maritime policy. Although Britain has such a large coastline and maritime industry, we must recognise that we are part of the European continental shelf. Therefore, many of the policy issues that affect the maritime environment and operations emanate from Brussels. It is easy to blame Brussels for everything that goes wrong—for delays in enforcement and implementation—but some of the policies that are being introduced are very helpful. That applies not only to sea but to air. It is clearly appropriate that there should be European policies on many of those matters, rather than a UK one alone.

In the past year or so, I have been struck by something that the noble and gallant Lord, Lord Boyce, referred to. The demand for maritime transport is increasing dramatically and very fast. We have spent a lot of time in your Lordships' House discussing road traffic congestion and, sometimes, railways as well. However, I understand from some of the major shipping lines that they expect there to be two to three times the number of containers coming into this country in 20 years. Whether it is two or three times the number does not matter very much. It is not only the containers coming in full that we are talking about— they will probably have to go out again empty, although that is a matter for a different debate. However, there is likely to be an increase in coastal trade and shipping, which will be good for our economy and ports but demands a policy to deal with it.

The noble Earl, Lord Caithness, said that maritime policy was important, and I agree with him. It primarily concerns freight, and it should of course be part of an overall transport policy, which includes not only the maritime part—the shipping—but the ports, railways and inland terminals. I declare an interest as chairman of the Rail Freight Group.

The noble Earl, Lord Caithness, mentioned devolution. Scotland deserves congratulations on what it has achieved already. One of the main achievements is the roll-on, roll-off ferry from Rosyth to Zeebrugge. As people in Scotland tell me, the great thing is that it avoids England and the congestion that England has created for itself. It is doing well in a comparatively short time and perhaps England—or Britain—should do the same.

Ports are very much part of the logistics chain, which probably starts in China or Eastern Europe, and ends up on our supermarket shelves or in our town centres. I understand that Ministers cannot really speak about ports at all at the moment, because of the planning applications that are under review. That is all right, but we can talk about the need for ports.

It is odd to reflect that the private sector provides the investment and efficiency in this country, in shipping and ports and so on. That does not happen on the continent, as the noble Earl said. That produces some anomalies, because when one goes to ports and terminals on the continent, one finds that they are lovely. There is enormous expenditure on them, and costs are low—there are no light dues on the continent, and so on. There is a lot of benefit from the private sector and the trust ports doing as they do in this country. However, if the private sector or the trust ports are going to invest to cope with the doubling or trebling of traffic in 20 years, they need the confidence that the Government will facilitate the road and rail infrastructure that leads to the ports—which, on the whole, cannot be provided in the private sector. If that is not done, they will go elsewhere; they will even go to France, the Netherlands and Antwerp, and we will end up as a country of feeder services, which will cost us more, and will mean that the goods take longer to get to market. Whether that is a good or a bad thing we can debate, but a lot of people believe the matter to be serious.

Do the Government believe that there is a need for a maritime and port policy, and a need for more UK port capacity? From that question follows the inevitable question, if the Government are going to facilitate the growth of ports around the country, do they believe that they have an obligation to facilitate the road and rail infrastructure that connects to the ports?

I take issue with the noble Earl on rail matters. He said that rail did not have a big part to play, but I would disagree, as he would probably expect me to. For example, Immingham is the biggest rail freight terminal in the country; it does not take as many containers as other terminals, but it takes an enormous amount of bulk goods, including coal. The noble Earl may not be aware that 25 per cent of electricity in this country is generated by coal that is moved around by rail. Sadly, much of it is imported and is just-in-time delivery. Sometimes, when the coal is in the train, the train is told to go to a different power station, which is quite difficult to organise.

To take another example, Southampton has very good rail freight services. The problem is the lorry queues; because of road congestion, it sometimes takes four, six or eight hours before lorries can get into the port. The rail services are quite good, however. Rail freight can cope, and can sometimes get priority over passenger trains it depends who arrives first on time. I do not believe that I need to go into that matter. However, it is important to have a policy that covers the maritime industry, the ports and service transport in a single framework, in which companies can be encouraged to invest.

It is interesting to draw the comparison with the White Paper on the 30-year policy for air, which came out yesterday. Why do the Government believe that we need 30 years for air when we have a 10-year policy for road and rail and, as other noble Lords said, not much about sea? It is important to have long-term policies, as it does not take much longer to build another runway or airport than to get an extension such as Dibden Bay or Barside Bay at Harwich, or anywhere else. There must be the public inquiry, and everything else. Why are we predicting and providing for air for 30 years ahead while doing nothing on the maritime side, although one hopes that we shall have a review of the transport policy next year?

1 turn to regulation and enforcement. We have discussed the issue of increased shipping. Who regulates that, ensures that is safe and enforces it? I declare an interest as president of the UK Marine Pilots Association. I succeeded my noble friend Lord Clinton-Davis in that role. As an example of the problem, the "Prestige" sank off Portugal last winter and is, apparently, polluting UK beaches.

The noble Lord, Lord Moynihan, referred to water quality, and he is quite right. I have a pilot friend who recently told me about a ship which he got on to pilot into a port on the east side of England—I shall not get any closer than that. He asked where the radar was, and was told that it was bust. He asked were the GPS was, but that was bust. When he asked where the compass was, they told him that there were two compasses. "Can I see them?" he asked. "Yes, they said, one is bust but one is working". He asked to see the deviation card which helps sort out magnetic anomalies. He found that the magnetic deviation was such that the compass always pointed north—a random direction—so that the compass was quite useless. He asked the captain how he managed to get from northern Europe to his destination, to which he replied, "I followed someone else". The captain was in charge of a big cargo ship. There are many examples of, "I followed someone else". It was lucky that the weather was not foggy.

Noble Lords will recall the incident that I believe took place in late May where a large container ship, which I believe was registered in Monrovia, ran down a yacht. Luckily, the people in the yacht were rescued somewhere between Southampton and Cherbourg. At the time I asked a Minister who would enforce action against the ship that was clearly speeding in extremely dense fog. The answer was, "It is registered in Liberia, isn't it?"

Do members of a crew speak the same language? Can they communicate with one another? The noble Lord, Lord Clinton-Davis, referred to that. We must do something about this matter. Just imagine if an airline pilot could not communicate with his navigator as they did not speak the same language. That would not be allowed, would it? So why should the maritime industry get away with that? There are some extremely good shipping lines and coastal shipping lines in the world but there are also some awfully bad ones. The Government could take a lead, at least starting within Europe, on getting proper enforcement, proper rules and proper penalties, well ahead of whatever the IMO might achieve in 10 years or so, to ensure that we have at least taken some measures to prevent the next major accident when everyone will cry out for action. Would it not be nice if we thought of that first as part of a total maritime policy?

5.41 p.m.

Lord Greenway

My Lords, I, too, thank the noble Earl, Lord Caithness, for initiating this debate on shipping—a matter that we do not discuss often enough in this House. I congratulate him on the speed with which he has managed to obtain this debate in the new Session.

It is a pleasure to see that the noble Lord, Lord Bassam, will reply to this debate. He is a rather unfamiliar personage to be speaking on this subject. However, he will be pleased to hear that I shall join the noble Lord, Lord Clinton-Davis, in giving the Government a pat on the back. The Government have done a lot for British shipping. Their bold decision to have a proper look at the tonnage tax, setting up the report of the noble Lord, Lord Alexander of Weedon, bringing forward the White Paper and acting on it was very commendable, and it has brought results. As I think the noble Earl said, UK-owned tonnage has risen by 85 per cent since then. UK flagged shipping— which includes a number of ships coming in from other registries—has grown by more than 200 per cent. That is all very good for UK shipping.

The Government also made changes to the Marine and Coastguard Agency which proved to be very successful. The Deputy Prime Minister, who played a big part in pushing through the tonnage tax, also played a part in the changes I have just mentioned as I believe that he championed Maurice Storey, who became the chief executive of the MCA. Maurice Storey has done a remarkable job in transforming the industry, in setting standards that are the envy of the world, and in particular in working in partnership with ship owners which has attracted many foreign ship owners to flag into the UK register. I willingly add to the plaudits that he has received on his recent retirement. He has returned to the shipping industry from whence he came. The Deputy Prime Minister made a successful move in championing someone who came from the industry. I am delighted to see that Maurice Storey's successor, Captain Stephen Bligh, formerly with P&O, is also an industry man. That bodes well for the future of the MCA.

The tonnage tax carried with it a training requirement which has also notched up a certain success. Nowadays we have upward of 600 officer cadets training as opposed to just over 200 some years ago. Indeed, the number has gone up 30 per cent over the past year. That is very welcome but there is no point in training young people to go to sea if we cannot find berths for them when they have completed their training. That is one of the problems we have yet to face. Although our cadets are extremely well trained, they are also fairly expensive compared with officers from other countries. That problem must be addressed if we are to help with the general safety of shipping. As my noble and gallant friend Lord Boyce said, shipping is basically under threat from the seafarers who operate it. That is the main problem at sea today—the standard of officers. Your Lordships will remember the case of the "Tricolor", the Norwegian car carrier that sank after a collision in the Channel. There are several well publicised cases of ships actually running on to the semi-submerged wreck. Since then, up to one ship a week has passed within the wreck marking buoys. What does that say about standards of seamanship today?

The Government's White Paper was very good in so far as it went but there are still a number of outstanding matters that remain to be addressed, which I shall outline briefly. One is the possible extension of the tonnage tax to other sectors of shipping such as aggregate carriers and specialist North Sea vessels which come up against a great deal of foreign competition. There is also the question of foreign earnings deduction, which is an income tax alleviation available to deep sea crews spending more than 183 days overseas. However, that is not available to crews on domestic and limited short sea services who are employed away from home on similar employment patterns. Companies involved in those sectors have real problems in retaining their officers.

There is also the question of extending crew relief costs to short sea shipping and assistance with training where the aid regime currently averages 40 to 50 per cent of the training costs. In the industry's opinion it should be increased to 100 per cent.

The tenor of the debate has concerned a maritime policy. The Government love to talk about joined-up government but I see no real progress in joined-up government in relation to maritime matters. As I said, just as one department of the Government has a certain success then along comes another department such as the Treasury and puts its foot in it without prior consultation with the interested parties. We have had two recent proposals which might have jeopardised the recovery of British shipping. One was a proposal to withdraw the exemption of merchant shipping under Section 9 of the Race Relations Act, which admittedly came from Europe, but would have meant that all non-resident crew on British vessels would have had to be paid at UK rates. That would have resulted in a loss of 400 ships to the British register.

There was also a problem with National Insurance contributions. The Inland Revenue announced that the employers' exemption for seafarers paid offshore would be withdrawn. That proposal has been partly modified though not to the satisfaction of NUMAST.

I am pleased to say that nothing came up in the Pre-Budget Statement last week, but there are threats emerging that may affect the continuing resurgence of UK shipping. One involves changing the leasing arrangements under corporation tax. The other is the old chestnut of taxing the domiciled Greek ship owners in the City of London. Greek ship owners have played a very important part in the City of London and in particular in the Baltic Exchange for many years. Their offices in London act as a line of communication with the Greek shipping companies and, at present, Greece controls the largest shipping fleet in the world. As a result, much business flows into maritime London for the ancillary services, insurance, banking and legal affairs and so on. Therefore, I believe that the Government would be ill-advised to apply such a tax. Such people supply much to the country, not only in respect of shipping but in other areas as well.

Ports have been mentioned quite a lot in the debate and so I shall not say too much about them, other than that I warmly support what has been said about them and the urgent need for more container capacity in the south east. Over the years, our planning procedures have been gargantuan and over-lengthy. Although the Government have made noises about speeding things up, something must be done more urgently because there is no doubt that the big shipping companies will take their ships, which are becoming larger and larger by the day, to continental hubs and goods will be feedered across to us, resulting in more expense for the shippers.

Light dues have been mentioned in passing. Here, like the noble and gallant Lord, I declare an interest as a Younger Brother of Trinity House. Last April, the Government announced that they are making no changes to the philosophy of light dues. However, I understand that further consultations are taking place. The options being considered include a more equitable method of charging. That would please operators with large container ships, which call at UK ports only six or eight times a year compared with the ferries, which are in and out every day. I believe that that would be a useful avenue to consider.

The noble Lord, Lord Moynihan, dwelt on the leisure side of the maritime industry. I fully support what he said. It enables me to dismiss that subject— not that I was intending to talk about it, but it is a very important part of maritime Britain. In passing, the noble Lord mentioned light dues. I know that the Government have considered the possibility of charging yachtsmen and yachts. The difficulty is how one goes about that. I do not believe that at present the Government want to adopt a registration scheme for yachts, especially with an election not too far away, because a large number of people go sailing.

It is not strictly true to say that light dues are not paid on the Continent. They are not paid in France, Holland or Germany, where they come out of general taxation, but you can bet your boots that they are hidden in other port charges, which the shipping companies do not necessarily see. If one looks at the world situation and takes the top 50 countries, it is interesting to note that a third of them cover the cost of lights and voyage from general taxation, a third part-fund them from light dues, and a third charge light dues. Therefore, the issue is not as clear cut as some people believe.

I now turn to the subject of safety, which has also been mentioned. Here again, the MCA has done an excellent job, and the setting up of SOSREP—the Secretary of State's representative in case of maritime disasters—has worked extremely well. That came out of the report of the noble and learned Lord, Lord Donaldson: Safer Ships, Cleaner Seas. It must be said that the efforts made in that respect, coming as they did from the "Sea Empress" disaster and the experience of earlier disasters, such as that of the "Torrey Canyon", have again placed us in a pre-eminent position with regard to the rest of the world so far as concerns safety.

Initially, the International Salvage Union was not very keen on the SOSREP idea, but it has come to accept its merits fully and now promotes our system as a model for the rest of the world. Indeed, that is happening. Europe recently set up its own safety agency—the European Maritime Safety Agency— which is to be based in Lisbon. However, I believe that there is a slight danger here. If Europe tries to take over all European safety, that may affect our present pre-eminent position by dumbing down to a general level.

Ports of refuge have not been mentioned. That subject is under discussion and I believe that something must be done by next February. Perhaps the Minister can confirm that. The issue has arisen from several maritime incidents—in particular, the "Prestige" off Spain. In the opinion of most maritime experts, that ship and her cargo could have been saved had she been towed into one of the many inlets that exist on that part of north-west Spain. It is important that countries designate—they do not necessarily have to publish them—ports of refuge where ships in trouble can be towed.

Some of your Lordships may remember the incident involving the "Flying Enterprise". Heroic efforts were made by the captain and the mate of the tug "Turmoil" to save the ship but, sadly, they failed. However, nowadays, it seems to me that at the first sign of trouble the crew are whipped off by helicopter and the ship is left to its fate. That cannot make good economic sense. I believe that the insurers and the banking fraternity can play a more important and far larger part in ship safety and in helping to rid the seas of sub-standard ships.

On the question of the "Prestige", we have seen unilateral action taken by Europe in banning from ports single-hull tankers carrying heavy fuel oils. We have seen the extraordinary situation whereby perfectly sound ships have been escorted some 200 miles off the coast of Spain. To my mind, that must go against the law of the sea. I am surprised that no one has yet brought a case. It is far better to leave such actions to the International Maritime Organization, which is the international body for dealing with such matters. Europe has now acted and that has set a precedent, which, for me, is a danger for the way ahead. I believe we must deal with shipping internationally—it is an international business. While I am on the subject of the IMO, I pay tribute to Bill O'Neill, who is just retiring after 14 remarkable years there. I believe that he has done a splendid job.

I want to comment briefly on short-sea shipping, which was mentioned by the noble Lord, Lord Berkeley. I believe that efforts are being made to increase the use of the sea with short-sea shipping, and a new Short Sea Bureau has been set up under Professor James McConville. That is a welcome development.

I welcome what the noble and gallant Lord said about the Sea Vision UK project and SeaBritain. It is a welcome step for the public and the media, in particular, to be educated in shipping matters.

I was going to say a few words about the ghost ships but I shall pass on that. Suffice it to say that in this country we have been breaking up ships for years and I believe that the whole thing has been an utter nonsense.

In the future, global shipping will be influenced by one thing in particular—that is, the growth of China. We shall see a huge increase in Chinese shipping. Chinese crews will be the main source of seafarers in the future.

In conclusion, it is desirable that Her Majesty's Government recognise the importance of shipping and its advantages and that they maintain a strong and well run maritime transport sector. How do we do that in terms of a shipping policy? I have mentioned previously the prospect of a possible Minister for the sea. I do not believe that we can go down that road now, but the Government are very fond of tsars. Perhaps a shipping tsar would be another way of tackling the issue.

5.59 p.m.

The Earl of Mar and Kellie

My Lords, I am grateful to the noble Earl, Lord Caithness, for giving the House the chance to debate these matters. When I first saw the title of the debate I was interested to find out what a comprehensive maritime policy was. So far we have heard a wide range of ideas and I have learned a little more. I hope to bring into the debate my ideas of what maritime policy should involve, maybe widen the debate and possibly stray into devolved matters.

Five years ago I would have cried "foul" but I am happy for Scotland to be debated here now that we have successfully restarted the Scottish state. In that context, I mention in passing that having a First Minister who was brought up on an island is a benefit and having a Deputy First Minister who represents an island is also good and useful.

I acknowledge the ideas of many speakers, although I shall not touch on them myself. I certainly go along with the point made by the noble Earl about Scapa Flow and Hunterston and the point raised by the noble and gallant Lord about defence, beaches, shores and light dues. No one mentioned—although I anticipated that they would—tidal and other forms of energy or oil rig security. The transfer from road to sea was mentioned by the noble Lord, Lord Berkeley, who spoke of goods being taken from the port on to the rest of the transport infrastructure. No one mentioned marine nature reserves. The noble Lord, Lord Moynihan, mentioned recreation and I was glad to hear at least one other person broaden the debate. Flags and crews were mentioned but no one mentioned coastal defence—I do not mean military defence.

I am certain that maritime policy is about shipping in all its forms—cargo, passenger, holiday-makers, ferries—and hence about the infrastructure that makes shipping activity possible. It is inevitable that the world's fourth largest economy, when based on an island group, will be dependent on ships for all forms of overseas trade. I acknowledge in passing that some economic activity also goes by the tunnel, by air, by underwater cables, by pipeline and by satellite. The noble Earl stated that by weight 95 per cent of trade goes by sea. I am sure that he is correct. It certainly sounds likely.

On these Benches—I wish they were occupied by at least one other person—we are concerned about maritime piracy and armed robbery against ships. That is a serious threat to the well being of our seafarers and our ships but it is also a threat to the marine environment should any ship be sunk or have some of its cargo jettisoned into the sea.

Since I left school I seem to have started to collect islands; at least, I visit them—island bagging, if you like. The result is that I am reasonably familiar with some of the steamer routes. Visits ensued to Arran, Bute, Islay, Jura, Mull, Iona, Tiree, Skye, Barra, Vatersay, the Uists and Benbecula, Harris and Lewis, Orkney, Hoy and Shetland. Perhaps the gems were Mingulay and St Kilda. The result of all that misspent early adulthood was a reasonable familiarity with many of the mainland coastal ports and harbours. Many of those places are as remote as the islands that their ferries serve. Last summer when in Mallaig I found myself agreeing with the claim made in Mallaig that it is more typical of a Norwegian port than a Scottish one in view of the amount of wilderness that one must travel through to get there by road or train.

The maritime environment provides for much of our food, and sea fishing is an activity that currently finds itself in controversy. With so much of the United Kingdom fishing fleet based in Scotland, one cannot but recognise that over-fishing occurs and that the common fisheries policy of the EU receives most of the blame. Scottish fishermen may well feel that the common fisheries policy has shared out their fishing grounds over-generously and that the scientists are wrong and that the cod have moved northwards to cooler waters rather than being in danger of becoming extinct. I acknowledge that later today we shall discuss that issue further.

While preparing for this debate I mused on the semantics of the Motion. Did the noble Earl really mean to refer to "a comprehensive maritime policy" or did he mean a comprehensive marine policy? I suspect that he meant the latter. My fundamental approach is that a maritime policy concerns the way in which government deal with maritime areas, often remote coastal strips and the islands. It is a sad statistic that the populations of the 98 inhabited islands of Scotland have reduced to less than 100,000 for the first time in living memory. It is obvious that the islands are remote in almost every way and access to markets is a critical one.

1 believe that the Government should make every effort to enable people to populate all of our landmass and to make a living for themselves doing real work. This is not a call for subsidy. Only governments can construct infrastructure and place government work in remote maritime areas. With such a policy the private sector would see that there was less difficulty in following suit. The Government should make every effort to extend broadband into the remote areas. Not to do so holds back those areas, possibly even more so than the more central mainland areas.

I note with interest the endeavours of Scotland's other neighbours, Norway, the Faroes and Ireland. Anyone visiting Norway is bound to notice the efforts made by the southern Norwegians to enable people to live and work in the north of Norway. The infrastructure is magnificent and Norway wants its remote areas populated. By contrast, northern Sweden is relatively empty. That is their choice. It has to be reflected upon that Norway and Scotland both have oil and gas fields. However, the two countries have made different use of the revenues. In the Faroe Islands it is also striking how much effort is made to make life practical throughout that island group, where the terrain is largely perpendicular. In mentioning Ireland, I shall pick out its, requirement that 25 per cent of all inward investment must be placed in the west of Ireland.

Lest it be said that I spoke only of Scotland, not all islands suffer from remoteness problems. While visiting the Isle of Wight I saw an unusual amount of economic activity, as I did in Jersey, Guernsey and the Isle of Man. Of course that was for different reasons. Those three islands enjoy many institutions of state on their islands with the economic benefits that they bring.

Despite my obvious enthusiasm for matters Norwegian, I wonder whether it is good that Norwegian companies own so much of the Scottish fish farming industry. That market dominance and the problems of pollution, fish diversity and over-supply should be in local rather than overseas hands. The noble Earl has done well to bring a focus to the United Kingdom's interface with the rest of the world. I hope that that attention will be well used by the Government.

6.8 p.m.

Viscount Astor

My Lords, I thank my noble friend for introducing the debate. He is extremely knowledgeable on the subject of maritime policy, having been a Minister in this House responsible for a Conservative government's policy on maritime issues. He has demonstrated his expertise today. Most noble Lords who have spoken have some form of expertise, but I probably have the least of any noble Lord speaking in the debate. However, I shall do as much as I can. The noble Lord, Lord Bassam of Brighton, is shaking his head, but he at least lives by the sea and looks out at it every morning. No doubt he has a view.

As Conservatives, we have always wanted to see a fair deal for shipping. A number of challenges are coming up that will affect the industry, not least the impact of the EU working time directive and the possible EU ports directive. There is also a debate about light dues.

The statistics in relation to shipping are a success in this country. The noble Lord, Lord Greenway, was right to congratulate the Government. The trading fleet operated by UK-based companies under all registers has grown by 2.5 per cent in carrying capacity to 12.3 million deadweight tonnes, although the total number of ships has remained at about 590. The shipping fleet contributes significantly to our economy in terms of balance of payments and employment. Overseas earnings for 2001 have been maintained at £5.1 billion, of which the contribution to the balance of payments was £2.5 billion. It is a successful industry.

The noble and gallant Lord, Lord Boyce, pointed out the importance of our UK maritime fleet, which has been needed for recent events in the Middle East. With the noble and gallant Lord's experience as First Sea Lord and Chief of Defence Staff, he knows about the necessity of having a strong merchant fleet in this country.

In 1998 the Government published a White Paper on the future of the shipping industry called British shipping: Charting a new course. It was a supposedly comprehensive strategy to secure the future of UK shipping in the form of 33 interrelated measures. They have been mentioned tonight. Will the noble Lord give us some estimation of their success? How many measures have been put in place? The measures relate to increasing skills, encouraging employment, increasing this country's attractiveness to shipping enterprises, and improving safety and environmental benefit. How well do the Government feel they have done in achieving those goals?

The Chamber of Shipping in its annual review has commented on the introduction of the tonnage tax, which, by and large, has been a welcome development for the industry. It stated: Since the adoption of the tonnage tax three years ago, 62 shipping groups, representing around 200 companies and operating some 720 vessels, have now entered this tax regime. Aimed to place UK-based companies on an equal footing with their competitors world-wide, tonnage tax has offered companies a chance to be subject to low-level taxation based on the size of the fleet that they operate, rather than on actual profits. This system is increasingly common in shipping, particularly in Europe". Perhaps the Minister can give us the percentage of the total in terms of the number of ships and tonnes and tell us whether the Government expect that amount to grow.

There are two sub-sectors of the industry that are still not able to benefit from this tax regime—the aggregate carriers and specialist vessels operating on the UK Continental Shelf. What progress has been made? I believe that it is a matter of negotiation with the EU Commission. This is an extremely important area for those companies operating those ships. I should be grateful if the Minister could bring us up-to-date on it.

I mentioned earlier the EU working time directive. Perhaps the Minister can tell us whether the Government have made an assessment of how that is impacting on the industry.

The EU ports directive was the subject of a House of Commons Transport Committee report. I understand that the European Parliament has rejected that directive. Can the Minister give us our position on the issue? There were certainly differing views in the industry about whether its rejection was a good or a bad idea. The Freight Transport Association said that, this is a massive blow for the competitiveness of European ports and their customers as the Directive was designed to break down the barriers that prevent private companies operating dockside services in many EU ports". The International Transport Workers' Federation called the move, a milestone victory, not just for the trade unions and workers who campaigned so effectively against this hopelessly flawed legislation". So, what is the position on the legislation? I should be interested to hear the Government's view.

The noble Lord, Lord Berkeley, with his knowledge of the rail industry talked about that issue. Can the Minister tell us a little more about the connection between container ports and rail? This is an important issue. After all, one train can haul at least 40 containers as compared with the goods going by road. The noble Lord and my noble friend Lord Caithness talked about short-sea shipping. The Government have a duty to play a proactive role in this area because, as we know, container ships are getting ever larger and are carrying more containers. If we can get them moved from ports cheaply—by rail when possible and of course by road when not—it will make a big difference to the economy.

Lord Clinton-Davis

My Lords, does the noble Viscount think that the diminution of British seafarers is a good or a bad thing? If he thinks that it is a bad thing, how would he address the situation?

Viscount Astor

My Lords, I shall not answer the noble Lord, Lord Clinton-Davis, because it is for the Government to respond to the debate. I have a number of questions and, quite frankly, it would take a long time to do that. I shall concentrate on letting the Government set out their stall and saying what their policy is.

I turn to the issue of light dues, which has been mentioned. In opposition the Labour Party promised to scrap this tax. So far as I am aware, it has not been scrapped. What is the Government's view? I would be interested to know whether they have changed their policy or have just not got around to the matter. It is claimed that none of our major competitors levies this tax, which means that we have an extra cost and ships visiting our ports have to pay a tax which they would not have to pay if they visited continental ports.

The House of Commons Select Committee concluded in its ports inquiry report that light dues are, inconsistent with other European countries and distort competition". I urge the Government to consider the entire concept of light dues and, in particular, to progress in the negotiations with the Republic of Ireland over the £5 million subsidy paid by this country for lights in the republic every year. What is the Government's policy on that? It would be interesting to know.

I turn to an area that was raised by the noble Earl, Lord Mar and Kellie—conservation. The maritime industry is not just shipping, but includes pipelines, drilling rigs, underground cables, offshore energy and so on. Which government department has an overall remit for environmental policy? Some of it must come under the Department for Transport, but obviously that department is not responsible specifically for energy policies, so how does that work between the various different sectors?

Finally, I turn to the extremely important issue raised by my noble friend Lord Moynihan of maritime sports. The associations of sea anglers and sea angling have a turnover of £1 billion. I hope the Government will support in principle all sea sports. After all, surfing bodies and pressure groups have made a huge difference in helping to clean up our beaches and in making sure that more local authorities achieve blue flags on their beaches than ever before. The surfing community is perhaps in the fore in putting on such pressure. It is a sport for the young; it is not expensive; one needs a surfboard, a wetsuit—unless one is very hardy—and one needs to be able to swim. On that note, I look forward to the Minister's reply.

6.19 p.m.

Lord Bassam of Brighton

My Lords, it is customary in your Lordships' House always to congratulate the originator of a debate. The noble Earl, Lord Caithness, is fully entitled to have rapturous congratulations in having brought these issues before us this evening. It is also customary to comment on the breadth of contributions to debates. That breadth has been excessive in many respects. I pay particular tribute to the noble Lord, Lord Moynihan, for introducing a dimension to the debate which I think probably, and in fairness and due deference to all other speakers, would have been absent if he had not made such a voluble contribution to what is an extremely interesting subject indeed.

I will probably disappoint the noble Lord, Lord Moynihan, by being unable fully to live up to the breadth of his contribution, but I recognise the importance of all the issues that he raised. As he acutely remarked, coming from a seaside resort, I am familiar with many of those issues. I am delighted that, with his customary vigour, the noble Lord is pursuing them, because they are important issues that need to be raised in national policy making.

Probably the most astute observation was that by the noble Lord, Lord Greenway, who observed that I was not as familiar as I might be with the subject. He struck a bull's-eye with that comment. But that does not lessen my great interest in the subject, because I recognise that this is an important debate. When I asked officials when the subject was last debated, there was much head-scratching and no one could remember a debate on shipping and maritime issues in recent times. That is unfortunate and regrettable; we must give the matter constant thought. I do what Ministers usually do at this point and apologise in advance for all the issues that I do not cover in my response.

I should make clear that the Government's transport policy does not just focus on particular problems such as road congestion and the state of our railways and is instead an integrated approach. That is important because it relates to the importance of ports and how they have come to the fore. The growing demand for port capacity, the substantial revival in the fortunes of UK merchant shipping—to which most speakers have referred—and the trend towards larger vessels have made ports and the needs of those who use them topical.

Several noble Lords—the noble Viscount, Lord Astor, the noble Earl, Lord Caithness, the noble Lord, Lord Greenway, and others—referred to the substantial growth in the handling of goods and use of ports in the European context. We handle more goods than any other European country. In 2001, they totalled 566 million tonnes. Through-put does not necessarily equate to efficiency, but UK ports are among the most efficient in Europe in terms of volume handled per metre of quay and per hectare of container storage. We anticipate that that efficiency will continue steadily to increase.

As the noble Earl, Lord Caithness, said at the outset, not only does this country have a long maritime tradition but 95 per cent of our international trade is by sea. As an island nation, we have 10,500 miles of superb coastline. Shipping that is safe and clean is therefore essential to the prosperity of the United Kingdom. The maritime industry also makes a significant contribution to the UK economy. In its "Sea Vision" campaign, with which we are delighted, which promotes UK shipping, the Chamber of Shipping recently estimated that the UK maritime industry has a turnover of £37 billion and accounts, directly and indirectly, for a quarter of a million jobs.

Much praise has been directed towards the Deputy Prime Minister for his important role in introducing a new shipping policy. As several noble Lords have mentioned, that was set out in 1998 in the White Paper, British Shipping: Charting a new course. The noble Viscount, Lord Astor, asked me how we thought that we were progressing in reaching the targets set out in that document. Progress-monitoring is under way. I am happy to write to the noble Viscount to update him about the progress that has been made. The shipping task force meetings are working on that, and the 33 measures have gone a long way to ensuring that we secure the important policy objectives set out in that document. It focuses on an integrated strategy aimed at reversing the decline of the British merchant fleet and the number of British seafarers that had occurred during the previous 20 years.

Much reference was made to the introduction of the tonnage tax in 2000 and the registration reforms of the Maritime and Coastguard Agency. Those measures have helped to produce a favourable environment for shipping. That is clearly demonstrated by the 200 per cent growth in gross shipping tonnage registered under the UK flag since 1997. In June 2003, the UK-registered trading fleet stood at 8.9 million—in 15th place in the world league tables, as it were, and accounting for about 2 per cent of the world trading fleet.

Shipping provides our primary link to international markets and considerable opportunities for the development of sustainable traffic flows. Our ports play an important role as a key connector in multi-modal transport systems used for the vast bulk of our trade and by millions of domestic and international passengers. They represent the heart of many communities and their continuing success is central to local and regional regeneration and prosperity.

The Government recognise that the worldwide shipping and ports sector is growing strongly. The United Kingdom has an excellent opportunity to benefit from that growth and there is clear potential for significant inward investment and the delivery of wider economic and environmental benefits.

I shall try to respond to some of the points raised. An important question raised by the noble Lord, Lord Berkeley, and others, was why it was that there is a national policy for aviation and airports but not one for ports. We take the view that, compared with ports, airports are much more likely to become major development hubs in their own right and require land-take close to urban areas, placing heavy burdens on road and rail access infrastructure. Through aircraft movements, they give rise to significant environmental impacts over a wide area.

Although they can have some of those features, ports generally have much less effect on surrounding populations. The Government believe that, as far as possible, proposals for port expansions should be treated in the same way as other commercial and industrial developments. Of course, that does not mean that the impact of port developments, including those over a wider area, should not be taken into account by the operation of the planning system in the normal way.

I know that criticisms have been made of how the planning process can impact on the development of ports—this point was raised by the noble Lord, Lord Greenway—but we are ensuring that there are changes and reforms. We are all aware of those concerns. A review of marine consents procedures is being undertaken, although I confess that it has taken somewhat longer than we hoped to announce its conclusions, but we shall do so sometime in the New Year. We have now published an appraisal framework for ports, derived from our guidance on multi-modal studies, which, 1 think it is fair to say, has been generally welcomed.

We believe that that will improve the development and consent process and assist promoters, objectors and all others involved in planning inquiries in determining whether all relevant factors and concerns have been properly considered. We have also announced measures to streamline the public policy process, while ensuring that all views of important stakeholders can be adequately considered.

Important questions were also raised about the forecast demand for port capacity. The noble Lord, Lord Berkeley, certainly raised the issue. We acknowledge that increasing demand for port capacity is one of the principal challenges that we must face in order effectively to handle the growth in container traffic and in the size of ships themselves. The UK ports sector has risen to that challenge and, as a result, during the past few years, several major proposals for new facilities across the United Kingdom have been made. Reference was made to some of those developments—in particular, by the noble Earl, Lord Caithness. We have had to give those matters careful consideration. In the devolved administrations we will be taking consistent decisions after weighing up all the relevant factors and looking at the balance of advantage. The Government are working hard to understand better the pressures on port capacity. That is a complex task. It has been suggested that we should make our own forecasts of container demand. However, there are existing forecasts on container traffic which at least appear to be in broad agreement, so the extra benefit that Government forecasts would bring is not clear.

Noble Lords have also called for more Government intervention, an important issue regarding public funding for our ports. As befits a maritime nation, the United Kingdom has a large number of ports of all sizes that cater for all traffic. It is not perhaps widely known that there are 1,030 commercially active ports, wharves and terminals around our coastline. Unlike continental Europe our ports are in the private sector, as noble Lords have observed. Likewise, although shipping is vitally important to the United Kingdom, it is run on a strict commercial basis. Our general approach has been that commercial port developments and operations should not need public subsidy, whether that originates from domestic or community programmes. Port infrastructure can, and should be, commercially financed, as, in our view, public money is not well spent by distorting competition between the many ports in the United Kingdom. However, we recognise that there are circumstances where economic impact is outweighed by social and environmental gain. In each case we take a careful view on the merits before particular decisions are made.

The noble Earl, Lord Caithness, raised the issue of new port development. I have already referred to that and there is consideration of a number of applications for new container terminals. As was accurately predicted, they are not matters upon which I can comment at this stage by looking at the merits of the different proposals. It would be fairer if those decisions were made and announced in the usual way. It would be extremely unwise for me to comment.

I now turn to other questions raised by noble Lords. The noble Viscount, Lord Astor, raised the EC directive on market access to port services. The Government were disappointed by the rejection by the European Parliament of proposals that we saw as being fair and workable compromises. Our commitment is to continue to press for a workable strategy for the liberalisation of the community port sector. We take that seriously, but it is unlikely to happen in the near future. The noble Viscount also raised the access to ports directive, although I might be wrong. We intend to press the EU on that issue, the importance of which we recognise. It figures large in our discussions and negotiations.

The issue of light dues was raised by the noble Lord, Lord Greenway, and the noble Viscount, Lord Astor. We believe that light dues are an important aid to navigation and should be paid for primarily by those who use them. Taxpayers should not be expected to meet those costs. I hear the comments of the noble Lord about seeing them as another form of taxation; and also I note his comments about our view in opposition. Recently we have had a consultation exercise on reviewing light dues, the outcome of which was inconclusive. There was no clear consensus for change to the current light dues structure, or a solution to how costs could be more fairly distributed. I can confirm that an economic study is under way on the effect of light dues on commercial operating costs and trading patterns.

Lord Clinton-Davis

My Lords, before my noble friend reaches the end of his remarks, would he be kind enough to say something about crewing? Significantly, that issue has been omitted. When I was Minister of Shipping, crewing was all-important. Would the Minister comment on that vital issue, without which British shipping cannot make the progress that we want to see?

Lord Bassam of Brighton

My Lords, certainly I recognise the importance of that issue. The Government see the importance of seafarer training to ensure that we provide for the future of the industry. We have been encouraged, and are doing all that we can to encourage, seafarer training. Our support for the maritime training scheme has been running since 1998. We have invested in that. There is support for the training of officers and ratings. I understand that there is currently a budget of some £9.5 million a year. In the year 2002–03 the scheme funded 557 cadets, which is an increase of 16 per cent over the previous year. In a sense, that gives testament to the commitment that we have as an Administration to providing for a workforce for the future that responds to labour pressures and the demands that the development and growth in shipping will undoubtedly place on our economy.

The Government's shipping policy has resulted in a substantial revival of the merchant fleet. I have already spoken of the important boost that we have given to training to cater for that. A number of noble Lords have referred to the fact that we have created a positive environment for shipping and the wider maritime sector. We are determined for that to continue. We have established a sound partnership with the industry and the shipping task force. We will continue to build on the valuable co-operation that we have generated. The Government clearly recognise the importance to the United Kingdom of the continued economic success of the ports sector. We believe that we have in place a comprehensive package of measures which is right for a modern, successful, sustainable and safe ports industry. The Government are actively helping to ensure that the maritime industry as a whole is in good shape to deal with future challenges and seize new opportunities.

We have had a valuable and important debate. I apologise to noble Lords for my inadequacy in dealing with all of the issues that have been raised, but they were many. I shall review them all and ensure that specific responses are made to those questions as a matter of courtesy and to ensure that they are put on public record. I am grateful to the noble Earl, Lord Caithness, for initiating this debate and I apologise for my inadequacies in responding, but I congratulate all those who have taken part on their valuable contributions to a matter of increasing importance.

6.38 p.m.

The Earl of Caithness

My Lords, I am grateful to all noble Lords who have taken part in this debate; in particular to the Minister for his efforts in replying to many of the questions. There were more unanswered questions to which many of us looks forward to receiving either a mass of letters, or a very long letter, in the near future. I hope that the Minister will also draw the debate to the attention of the Secretary of State because it is of key importance.

It was nice again to hear my old friend, the noble Lord, Lord Clinton-Davis. He always reminisces about the past, often selectively. But he was right to mention the revival of the fleet under the Red Ensign. We all welcome that. But I say to him that because scheduled transportation is a slave to the clock, it does not matter to shippers and our industry whether goods come in or out under the Red Ensign or the Liberian flag. They want regular and consistent deliveries.

The noble and gallant Lord, Lord Boyce, reminded us how full are the Dover Straits. I remember opening the latest radar there in the 1980s. Again, that is now outdated due to the amount of traffic. It serves only to strengthen my argument that we need ports other than Zeebrugge and Southampton as our major container ports to take traffic out of the Dover Straits and reduce the possibility of accidents.

I was grateful to my noble friend Lord Moynihan for mentioning sport and recreation. He is welcome to enjoy the good surfing at Thurso and I look forward to seeing him there. I was sad that he made no mention of petroleum carriers and power generation at sea, about which he knows a great deal. Perhaps we should have another debate to allow him to do so.

The noble Lord, Lord Greenway, with his fund of knowledge, was right to say that the MCA has been a success and to raise concerns about standards of seamanship.

The noble Lord, Lord Berkeley, mentioned the "ro-ro" ferry between Rosyth and Zeebrugge. However, he did not tell your Lordships that in 1998 the then Minister of Shipping, Glenda Jackson, refused to support an application for European funding under the EU's PACT programme for a direct Scotland-Continent ferry service. She did so on the basis that the Government wanted to use the PACT fund only for rail projects, thereby discriminating against sea transport. One of the bonuses of devolution was that the matter was referred to Scotland. With cross-party support in the Scottish Parliament, funds were applied for and obtained. As the noble Lord, Lord Berkeley, rightly said, we now have a successful service.

Lord Berkeley

My Lords, I am grateful to the noble Earl for allowing me to intervene. Does he agree that the Government have improved the situation— possibly turned it around—by the introduction of short-sea shipping grants, which I am sure he will welcome?

The Earl of Caithness

My Lords, I welcome anything that will help, but I do not believe that they have turned the situation around. There is an opportunity to help, but more must be done to assist the trans-shipment of goods into ports. We must use the railways to take our goods much closer to our industries in the north and the midlands, rather than bringing them all through the large container ports of Felixstowe and Southampton.

I am extremely grateful to all noble Lords who have taken part. It is far too long since we last had a debate on shipping and maritime policies. I hope that we have another soon, but meanwhile I beg leave to withdraw the Motion.

Motion for Papers, by leave, withdrawn.