Merchant Shipping Bill [Lords]

§ The Secretary of State for Transport (Mr. Paul Channon)

I beg to move, That the Bill be now read a Second time.

This Bill, introduced in another place at the end of October, deals, as the House will know, with a wide range of subjects, all of them important to the shipping industry and to the country at large. I am sure that the keenest interest of the House will be in the impact of the Bill upon marine safety, and that is where I wish to begin my remarks.

The whole House remembers only too well the appalling disaster at Zeebrugge last year. The House will agree with me that the public has a right to travel in safety. Transport and travel play an increasingly pervasive part in modern life in both commerce and leisure. All those engaged in the transport industry owe it to others to work uncompromisingly for greater safety. But I recognise that it is for the Government to establish the framework.

The loss of the Herald of Free Enterprise provided lessons in abundance for ship operators, for seafarers and for Governments alike. The Sheen report, which we received a few months ago, has formed in large measure the agenda for the Government's programme of follow-up action. More recently, the coroner's inquest has provided further valuable insights, particularly into the rescue arrangements and emergency procedures on board ships. I was determined to press ahead and implement as quickly as possible the main and most urgent recommendations of the formal investigation.

The law rightly requires consultation, and that has either taken place or is going on. We have now issued consultative documents on eight major packages of proposals. The first, covering the installation of vehicle deck door indicator lights, closed-circuit television monitoring of the doors and vehicle decks and self-contained emergency lighting, has now passed into law. Indeed, the installation of door indicator lights and closed-circuit television is already a legal requirement.

Two proposals — the introduction of boarding cards for the control of passenger numbers and the mandatory closing of vehicle deck doors before any roll-on/roll-off ferry leaves its berth, or as soon as it is physically possible to do so—will be dealt with in orders which I shall lay in about two weeks' time.

§ Mr. Eric Heffer (Liverpool, Walton)

Will the Secretary of State explain what he means by "physically possible to do so"? Surely it is important that the doors should be closed before the ferry leaves its berth. It could be out at sea before it is "physically possible" to close the doors.

§ Mr. Channon

The hon. Gentleman is quite right. Perhaps I did not phrase that as accurately as I could. It is mandatory to close the doors as a ship leaves a berth. There is a small number of berths from which it is not possible for some sorts of roll-on/roll-off ferries to leave with their doors in that position. This is a technical matter, and the regulations will make it much clearer. The hon. 505 Gentleman and the public can be reassured. He is right to draw attention to this, and, if he is still worried about it he can contact me about it when he has seen the order.

§ Mr. Patrick Cormack (Staffordshire, South)

The Secretary of State mentioned boarding cards. When can we expect that order to be in force, as distinct from being introduced into the House?

§ Mr. Channon

I hope that that will not take long. I shall ask my hon. Friend the Minister for Public Transport to give the hon. Gentleman an exact answer, but we are pressing ahead with the issue of boarding cards for the control of passenger numbers and I hope to lay orders in a few weeks' time.

Other orders are close behind, covering such matters as the provision of draught gauges, loading computers and emergency escape windows; the provision by managements of comprehensive operating manuals and arrangements for their inspection by my Department; the designation of a person ashore responsible for operational safety; the weighing of heavy lorries before loading; the provision of special emergency equipment; regular checks on lightweight and centre of gravity; the reporting of potentially dangerous incidents; and the checking and recording of draughts and centre of gravity before sailing.

There are also measures that can be taken as a result of administrative action. One such decision that my right hon. and learned Friend the Attorney-General and I have taken is, in future, to ensure that formal investigations into marine accidents are not only impartial, but seen to be so. The responsibility for appointing and instructing counsel assisting the court will rest not with the Secretary of State, but with the Attorney-General. More substantially, I have decided to make important changes in the duties of marine surveyors. They are to devote more of their time to work on passenger ships and carry out many more spot and incognito checks than before. The control of passenger ferry operations—

§ Mr. Gerald Bermingham (St. Helens, South)

rose—

§ Mr. Channon

Perhaps I may just finish this point. The control of passenger ferry operations by the Marine Survey Service will also be improved by some of the measures I have already mentioned, such as the requirement for comprehensive operating manuals. I have a lot to get through, but I will give way to the hon. Gentleman.

§ Mr. Bermingham

The Secretary of State will recall that, when he made his statement to the House in respect of the Zeebrugge ferry disaster and the Sheen report that followed, I asked about marine surveyors and the numbers employed. He was kind enough to write to me on that matter. Will he now confirm that, bearing in mind the administrative steps that he proposes to take, he will ensure that there is an adequate number of marine surveyors so that adequate and comprehensive surveys can be carried out both officially and incognito? That is the only way in which we shall maintain safety standards.

§ Mr. Channon

Of course, there will have to be an adequate number of marine surveyors. The fact that I intend to have a marine investigation branch means that more resources will be devoted to this matter.

A moment ago my hon. Friend the Member for Staffordshire, South (Mr. Cormack) raised the important matter of boarding cards. It is my intention that the order 506 to make boarding cards mandatory should come into force on 29 February. I am sure that my hon. Friend recognises that that date is before the summer season.

I come now to the international implications of the programme. I made it clear in July that certain crucial measures would need to be applied to all passenger ferries sailing from United Kingdom ports, regardless of flag. As our programme has developed, we have concluded that the majority of our measures ought to be applied in this way. But I do not wish to leave it at that.

Marine safety worldwide is dealt with by the International Maritime Organisation. Members will be aware that that organisation is extremely successful. It has had a series of safety conventions and, over the past few years, it has provided a great many benefits to seafarers and travellers all over the world. In November, I personally took an initiative at the IMO's assembly with the aim of obtaining early worldwide agreement—under the IMO's accelerated procedures — to many of the measures we have proposed, without, of course, prejudicing our right to require foreign vessels to conform, when in our ports, to requirements under our own laws pending international agreement. We obtained the assembly's endorsement of a resolution that we proposed and I am hopeful of real progress in the not too distant future. So we are pressing ahead domestically and internationally.

We have also convened a meeting of shipping administrations of the European countries — the main ferry operators exist in this part of the world — to consider the possibility of their taking action through their own laws. My main aim is to get the safety measures that we are imposing on United Kingdom ships and in United Kingdom ports extended to cover foreign ships in foreign ports as such ships, if bound for the United Kingdom, frequently contain large numbers of British passengers. But my further aim is to get international co-operation in enforcement. We have proposed, and received support for, the negotiation of a European ferry code as a vehicle for such an agreement. There is a lot going on.

Next, let us consider research. Last July I announced that I would be contributing a further £1 million to research on the safety of ro-ro ferries. A representative steering committee was announced in October and contracts are now being let. One of the first contracts, for completion before Easter, is to assess proposals for new ship stability standards now before the IMO for early adoption. Other contracts will cover the development of lifejackets that are easier to put on, and escape from a partially capsized vessel. But perhaps of greatest interest will be a programme that looks specifically at the basic design of ro-ro ferries. The Government are satisfied that ro-ro ferries are not inherently unsafe as some have alleged: a ro-ro ferry that is properly closed to the sea and intact is as unlikely to capsize as any other vessel. But improvements in the basic design to give a greater margin of safety may well be possible, and it is the Government's intention to complete the first phase of this work by the end of the year.

§ Mr. Cormack

Will improvements take into account that such vessels, if they sink, sink extremely quickly?

§ Mr. Channon

That is an important point. However, if they are properly closed to the sea they are completely safe. It is extremely important to bear in mind that if there is 507 a disaster of this kind—fortunately, exceedingly rare— such ferries sink quickly. My hon. Friend's concern is much in our minds.

§ Mr. Heffer

rose—

§ Mr. Channon

I will give way, but this must be for the last time.

§ Mr. Heffer

The Secretary of State will agree that this is the most important matter to consider because, as the hon. Member for Staffordshire, South (Mr. Cormack) has said, if such ferries are holed and their design is as it is, they sink within minutes—

§ Mr. Robert Hughes (Aberdeen, North)

Seconds.

§ Mr. Heffer

Yes indeed. That is why this matter is so important. The right hon. Gentleman said that the first phase of the work would be completed by the end of the year. What does that mean? Is that the first stage? How quickly will he move on from that first stage? That is the most important question to consider.

§ Mr. Channon

The first stage of the research will be completed by the end of the year, but we are doing other things as well. We are checking the stability factors of those ships and how they measure up to the most modern standards that we have in force at present. Therefore, a great deal of work is being undertaken regarding the stability of ro-ro ferries as well as a great deal of research on their basic design. However, the evidence around the world suggests that if a ro-ro ferry is properly closed to the sea and intact, it is safe. The House will be aware that, in many parts of the world, ro-ro ferries have been sailing for years and years. The important point is that those ferries must be properly closed to the sea.

§ Mr. Heffer

rose—

§ Mr. Channon

I must press on because other areas relating to safety are also dealt with in the Bill.

The responsibilities of ship owners, managers, masters and crews are terribly important to ensure that a ship is maintained and operated safely. Clause 30 creates a completely new duty on ship owners to ensure the safe operation of their ships..

Clause 31 tightens up on the duties of masters and crew, requiring them to exercise due diligence in the carrying out of their duties and explicitly stating that a master's duties include responsibility for the good management and safe running of his ship. It also includes new defences that are not in existing legislation.

Clause 29 deals with a ship that is unfit to go to sea whether because of its physical condition, overloading or any other reason, and affects the owner and master equally. Amendments have been made or will be brought forward to extend clauses 29 and 30 so that they equally cover ship managers and charterers.

Clause 32, to which I briefly referred a moment ago, also arises from the Herald disaster and provides for the establishment of a new statutory marine accident investigation branch. The new branch will be separate from my Department's marine directorate and will report directly to me. It will therefore be free to take an entirely independent view should an accident raise questions about the regulatory policy of the Department. We also intend that all the branch's reports on the more important or significant accidents should be published.

508 The House will have many opportunities in the coming months to debate this programme. After tonight, there will be the Committee stage; and a number of the orders that we plan will be subject to affirmative procedure debate.

We all know that there is one group of people to whom this programme is of deep personal significance: the survivors of the accident and the relatives of the victims. They, above all, will wish to know that everything possible is being done to avoid a repetition of the Zeebrugge tragedy. I made arrangements to meet the Herald Families Association next week to discuss its concerns and suggestions as I wish to hear what it has to say to me.

I should refer briefly at this point to the proposal that has been made by the hon. Member for Aberdeen, North (Mr. Hughes) to refer the Bill to a Special Standing Committee. Of course, I have considered that suggestion extremely carefully, but I believe that the problems have already been fully exposed. There has been the Sheen formal investigation and the coroner's inquest, and I doubt that much could be done to add to our knowledge by a further round of hearings. This is not the time to go back to square one. I believe that our priority now must be a more specific, but no less demanding or responsible, task.

Our duty, which only Parliament can carry out, is painstakingly to consider specific proposals, make clear judgments, and decide what changes should be made to the law. I am sure that the Standing Committee will want to consider the safety proposals carefully. I can assure the House that the Government are willing to listen to constructive arguments on these important matters and to be responsive to them, from whatever quarter they come. But I have no doubt that the right course now is to get down to the task in Committee without further delay. For those reasons, I cannot support the proposal that we should have a Special Standing Committee as well.

§ Mr. Frank Field (Birkenhead)

I apologise for not hearing the beginning of the Secretary of State's speech. I am sure that the whole House welcomed his statement that in the near future he will be meeting families connected with the disaster. What contact did he have with the families before drafting the Bill? He said that in a sense the Bill is a result of that terrible tragedy. The two points that the families put to hon. Members at a meeting the other night were that they were unhappy about the penalties for companies when such a disaster occurred and were concerned about the safety of the ferries still in service. If there is the prior consultation to which the right hon. Gentleman referred, will he give an assurance that if those two points have not already been taken on board he will welcome amendments on them in Committee?

§ Mr. Channon

I do not think that there was formal consultation with the families before the drafting of the Bill, but I think that the points that the hon. Gentleman raises are covered by the Bill or by other measures. For example, he will see that clause 30 deals with his point about owners. It says that if an owner fails to discharge the duty imposed on him — the duty that makes him liable for unsafe operation of a ship— he shall be guilty of an offence and liable—

1. (a) on summary conviction, to a fine not exceeding £50,000;
2. (b) on conviction on indictment, to imprisonment for a term not exceeding two years or a fine, or both."

509 We may be able to discuss whether that is exactly right, but those are not negligible penalties; they are certainly a great deal more than has been suggested in the past.

As for safety, there is, as I have said, the research programme going on into the inherent qualities of ro-ro ferries. Following the Sheen investigation, the question of the stability of the existing ferries is being looked at. I dealt with that matter in answer to the hon. Member for Liverpool, Walton (Mr. Heffer). If the Herald Families Association has further detailed ponts on it I shall wish to consider them when I see the association next week.

I do not want to take too long, because other hon. Members wish to speak, but there are a number of other important matters that I should like to deal with briefly: measures of assistance with the shipping industry; the registration of merchant ships; and the establishment of a new fishing vessel register.

All of us recognise the strategic importance of the Merchant Navy. The experience of other developed countries has been very similar to our own, and a complex reality lies behind the crude tonnage figures. Fundamental changes in our trading patterns have taken place. Much of our oil now comes from the North sea rather than spending weeks at sea being transported through the Suez canal or round the Cape. The European Community has replaced the Commonwealth as our major trading partner. We face fierce competition from Third world countries. There is a massive world over-capacity in bulk and tanker shipping.

But some sectors of the British shipping industry have coped remarkably well with a uniquely rough period in world shipping markets. Our container fleet is about the same tonnage as it was in the mid-1970s. Over half the United Kingdom's international freight earnings come from our liner and container fleets, which account for only one quarter of our gross tonnage. Passenger ships account for only 8 per cent, of our gross tonnage, yet the United Kingdom earns over £800 million from the passenger ship business. So it is a complex matter. The shipping industry's contribution to the balance of payments invisible account grew by £221 million in 1986, the best for some years—and a reminder that tonnage on the United Kingdom register and the industry's value as a source of foreign earnings do not always go hand in hand.

There is also the development of the Isle of Man and dependent territory registers, which has enabled much tonnage to remain under British registration, with British crews, while taking advantage of the savings obtainable offshore to improve the industry's competitive position.

Many adverse factors — over-capacity, Third-world competition, new trading patterns—are not within our control, and it is folly to believe we could somehow escape them by erecting elaborate and expensive frameworks of subsidy. What we do must be carefully targeted. There are specific measures provided for in clauses 25 to 28, designed to ensure that we continue to have sufficient trained seamen to meet the defence needs of the United Kingdom in time of emergency.

On training, we are particularly concerned at the small number of officer cadets at present being trained. The training scheme which we intend to bring into effect this autumn will build on the successful use already being made by the industry of the youth training scheme, and will provide help to ship owners and management companies with the cost of employing Merchant Navy cadets while they are being trained. Details of the scheme will be 510 announced as soon as possible. As has already been announced, £2.5 million has been earmarked for this scheme in the next financial year, rising to £3.5 million in the first full year, 1989–90.

Under the crew relief scheme, assistance will be available to pay a proportion of the cost of air travel for crew changes on ships registered in the United Kingdom, the Isle of Man, or the Channel Islands, which take place in distant waters. The objective here is to give companies an incentive to continue to employ officers and ratings resident in the British Isles in those ships which operate in the deep-sea trades. We have earmarked £3.5 million in 1988–89, rising to £5 million in the full year 1989–90, for this programme.

The third initiative, announced by my predecessor in December 1986, was the establishment of a Merchant Navy Reserve. The reserve will constitute a pool of experienced seafarers who can be drawn upon to supplement crews serving on Merchant Navy ships supporting the defence forces or engaged in supply. Membership of the reserve will be open to former seafarers holding valid certificates. Members will be paid a bounty in exchange for accepting an obligation to serve if called upon to do so.

Part II deals with the very serious problem of foreign-owned fishing vessels registering in the United Kingdom in order to fish against our EC quotas. This is, I know, a matter of concern to hon. Members who represent fishing constituencies. We are introducing stringent new eligibility requirements for the registration of fishing vessels in the United Kingdom. A fishing vessel would need to be beneficially owned as to at least 75 per cent, by British citizens resident and domiciled in the United Kingdom, or wholly owned by a qualified company. There will be powers to specify additional eligibility requirements.

These are stringent requirements, but we believe they are essential if British fishing quotas are to be preserved for British fishermen. They have been carefully drawn up in consultation with the fishermen's organisations and widely welcomed by them.

Part I updates the law on the registration of merchant ships. Hon. Members who are interested in this difficult and complicated matter will find the White Paper, published with the Bill, a helpful guide to this fairly technical area. The main objective of the changes, which I will not deal with in detail, is to ensure that there is more effective jurisdiction in future over United Kingdom-registered ships.

Importantly, the Bill gives new powers to the Secretary of State to define categories of register for the Crown dependencies and dependent territories. Under the present arrangements it has been possible for substandard shipping to obtain registration as British shipping in a dependent territory and thus to escape rigorous survey and inspection requirements applied to vessels on the United Kingdom register. The new arrangements in the Bill, combined with the substantial efforts which a number of dependent territories are making to improve their maritime administrations, will help to ensure that all ships sailing under the British flag meet the same high standards. In this way we are able to meet the recommendation of the Transport Committee of the last Parliament that early legislation should be brought forward.

There are a number of other clauses dealing with significant matters. Some of them — liability and compensation for oil pollution damage, lighthouses and 511 unfair competition in international shipping services—are very important, but I do not want to weary the House with a detailed exposition of them today. They can be gone into in Committee.

I have tried to cover the main issues. If hon. Members have any questions, my hon. Friend the Minister of State will be pleased to answer them in his winding-up speech.

§ Mr. Conal Gregory (York)

My right hon. Friend referred briefly to light dues. Will he confirm to the House that the Government are still paying half the light dues for southern Ireland, which is a scandal? I hope that the matter will be dealt with in the Bill. The amount charged last year was well above the level required by the authorities.

§ Mr. Channon

My hon. Friend is right. We are indeed paying Irish light dues; I would have to check the exact proportion. However, I shall give my hon. Friend a trailer. My hon. Friend the Minister for Public Transport may have good news on light dues when he replies to the debate. I hope my hon. Friend the Member for York (Mr. Gregory) will be here to welcome it.

There is a wide-ranging series of proposals in the Bill. They underline our commitment to maritime safety, help to safeguard our strategic requirements, protect United Kingdom fishing quotas for United Kingdom fishermen and overhaul the legislative framework. The proposed measures have been welcomed by the industry, and they have received general support in another place. I hope that the House will agree that the Bill should be given a Second Reading.

§ Mr. Robert Hughes (Aberdeen, North)

I agree with much of what the Secretary of State said. By and large, the Bill is non-contentious, although it contains some contentious issues. Having been upset earlier by the Secretary of State for Scotland, I must try not to carry my anger forward and vent my spleen on the right hon. Gentleman. There are many points on which there is agreement, but other issues will have to be scrutinised carefully in Committee. There is still much tidying up to be done in the legislation. I hope, as the right hon. Gentleman said to me in a letter, that he will be prepared to consider amendments on their merits.

I accept that much research is going on; and I welcome the fact that £1 million is to go into research, particularly on the safety of ro-ro ferries. I concede that there is no such thing as an unsinkable ship. The last ship that had that epithet was the Titanic. The right hon. Gentleman said that through ro-ro ferries are perfectly safe so long as they are watertight. That is much the same as saying that the Titanic was safe so long as it did not hit an iceberg.

I am still concerned about the safety of existing ro-ro ferries. We must consider urgently whether portable bulkheads should be fitted to protect ships. We hope that never again will there be another sinking like that of the Herald of Free Enterprise, which sank because the doors were left open, but we are concerned about a ship being holed. We do not suggest that the fitting of portable bulkheads would make a ferry unsinkable, but it would lengthen the time that the vessel would remain afloat. The time before the Herald capsized was so short that no one had an opportunity to save life. If we can buy time for 512 lifeboats and rescue vessels, that may be the best that we can achieve. Certainly we should seek to achieve as much time as possible.

§ Mr. Heffer

My question is not so much for my hon. Friend as for the Government. My hon. Friend may agree with my suggestion that all British ships should be brought in, one at a time, to have portable bulkheads fitted. Obviously, in the long-term new ships will be redesigned. In the meantime, ro-ro ferries could have departmentalised doors fitted to ensure greater safety.

§ Mr. Hughes

That suggestion is worth pursuing. I cannot remember how many ships of a design similar to the Herald of Free Enterprise are at sea. The majority of ro-ro ferries have a different door-closing mechanism. Most have a bow visor, which is up while the ship is loading, and no one can go to sea with that visor up. I am not running down my hon. Friend's suggestion. Indeed, the number of vessels affected by his proposal might not be large, so the proposal should be considered seriously.

I am in danger of losing the thread of my speech. Before I come to issues which we will contest vigorously, perhaps I should deal with the Herald of Free Enterprise and with the motion that the Bill should be committed to a Special Standing Committee. When discussing merchant shipping and safety at sea, we all have engraved on our minds the events of Friday 6 March, when we first heard that the Herald of Free Enterprise was in difficulty. As events unfolded, we discovered that it was a tragedy of immense proportions.

The tragedy could have been far worse. Had the sinking taken place a quarter of a mile, or half a mile, further out, I doubt whether anyone would have survived. I am not minimising the loss of life, nor being complacent by taking refuge in the comfort that things might have been worse. It merely makes us more vigilant in ensuring that we scrutinise safety properly.

The procedure for referring a Bill to a Special Standing Committee was designed for non-controversial Bills. It has rarely been used. I think that this Bill almost exactly fits the category for which the procedure was tailored. I am sorry that the Secretary of State has turned his face against the proposal. During business questions last week we were encouraged by the Leader of the House to believe that the matter might be resolved through the usual channels. I am grateful to the Minister for meeting my hon. Friend the Member for Stretford (Mr. Lloyd) and myself to discuss reference to a Special Standing Committee. I wrote to him subsequently, and perhaps I should give the House our reasons for proposing that the Bill be committed to a Special Standing Committee to consider safety at sea.

We welcome what is being done by regulation and administration. We welcome what is proposed in the Bill. The point I wish to emphasise is that this is likely to be the only major shipping legislation in this Parliament. I cannot see that there will be time for another major merchant shipping Bill. Therefore, it is important that we do not overlook any aspect of safety and that we get the Bill right.

The Secretary of State is correct. We have had the Sheen report and the coroner's report. We are still waiting to see whether there will be prosecutions that might bring out further evidence. But there may not be prosecutions. There is still a body of opinion that we should not ignore any approach that might shed further light on how to improve safety at sea.

513 It is significant that the proposal to send the Bill to a Special Standing Committee came from the Herald Families Association. The association wrote to my hon. Friend the Member for Stretford on 21 December about its concern for the safety of existing ro-ro ferries. It drew my hon. Friend's attention to the special procedure and asked whether the Bill could be dealt with in that way. We have no intention of intruding on the grief of the families, or of prolonging or exploiting that grief, but as the initiative came from the families it should be considered seriously. We should bring in experts to answer our questions. Often non-experts or people directly concerned with an incident ask a blindingly obvious question which has not occurred to other people who have been studying the matter.

§ Mr. Jonathan Sayeed (Bristol, East)

As the Bill includes useful provisions to increase safety, does the hon. Gentleman not accept that a Special Standing Committee would delay its implementation?

§ Mr. Hughes

I am glad that the hon. Gentleman raised that point, because it allows me to emphasise what I was going to say. I should be glad to be corrected, but I can see nothing in the Bill that has to be passed by a fixed date to get things moving. We have made it perfectly clear that our proposal to send the Bill to a Special Standing Committee is not intended to delay progress. I accept that if the Bill went to such a Committee, reasonable time would have to be allowed so that people could prepare their questions and their evidence. I recollect that the procedure allows for only three sessions to take evidence.

I have offered the co-operation of the Opposition in getting the Bill through as rapidly as possible, and I believe that we could proceed along those lines without any great delay. I cannot say that there would be no delay, but there would be no great delay, and I hope that, even now, the Secretary of State will relent and allow us to put the matter to a Special Standing Committee. Today's debate will decide whether we will divide the House on that matter.

I shall deal with an issue that is not controversial before coming to the controversial matters. I accept what the Secretary of State said about the need for registration for fishing vessels to prevent the abuse of registration and access to the United Kingdom quota of fish under EEC rules. I hope that such regulations will be speedily implemented, but one or two issues need to be clarified.

The Scottish Fishermen's Federation believes that there should be registration of all vessels, irrespective of length or size, but the line must be drawn somewhere, or rowing boats or small vessels with outboard motors might have to be registered. As far as possible, the maximum number of boats should be registered. There is also the matter of the old register being closed and the period of transition, and whether the title of vessels should always be registered. The Scottish Fishermen's Federation has a point that should be considered in some detail in Committee.

I join the federation in welcoming the fact that under part III some money is to be provided to assist the training of officers and ratings in the Merchant Navy. That is a good idea, but why are the Secretary of State and the Government steadfastly refusing financial assistance for the training of fishermen? It is expected that the Secretary of State will make regulations under the Safety at Sea Act 1986 requiring fishermen to be trained in survival at sea, fire fighting and first-aid, but he will not give them any 514 financial assistance. Why are the two parts of our maritime industry being treated differently? In previous wars fishermen served the Royal Navy extremely well. It was not only the deep-sea fishermen who had valuable experience to give to the nation. I hope that the Secretary of State will consider that point and perhaps take some action.

I now turn to an issue that is quite contentious and on which there is a great deal of disagreement. I have made representations to the Minister, who will know that I do not believe that the Bill should have started in the House of Lords. I accept that we have a bicameral Parliament and that the other place is perfectly entitled to start legislation, but it is generally accepted that such legislation will nor. be contentious, and that the House of Lords is at its best when reviewing legislation. I assert that it is not at its best when starting fresh legislation.

I resent the fact that the Government accepted an amendment on Report by Lord Mottistone, supported by the Earl of Inchcape, to remove section 42(2) of the Merchant Shipping Act 1970. Subsection (2) affects the position of seafarers involved in industrial disputes. It is a further restriction of the rights of seamen and it further tilts the balance towards employers.

The amendment was accepted in the other place after the most cursory examination. Indeed, no evidence was presented that such a change was needed, except for anecdotal evidence. Two of their Lordships thought that the subsection was redundant and that it was not necessary, but no facts were brought forward to support the removal of subsection (2). Lord Brabazon previously resisted an almost identical amendment in Committee. Having said, on Thursday 26 November, that he had no evidence that the change was necessary, 14 days later he accepted the amendment, saying that he had now been persuaded.

There was no reason for such a rush. It was the first time that the Bill had been aired. Lord Brabazon could have held his fire and asked for the evidence. He could have asked for consultation. He did not consult the trades unions involved or the employers' organisations, and he does not appear to have consulted his own Department. He had to admit that he had not had the time to prepare an amendment of his own.

That is no way to approach people's rights in industrial relations. It is likely to be extremely provocative. I do not take comfort from the Government's view, put about in the other place, and which no doubt they will put about in the House, that that change only puts seafarers square with other industrial employees in terms of industrial relations. That is no big deal. We know that throughout their terms of office the Government have been redressing the balance, as they would put it, between the unions and the employers. However, in the Merchant Shipping Bill they have gone too far.

I doubt whether the Government are aware of the ramifications of that amendment. Seamen do not work in a fixed environment. Their environment constantly changes. Perhaps in Committee the Government will be prepared to examine the legislation and change it. The amendment was made without proper consideration, and the Government will see the folly of their ways. We shall certainly pursue the matter vigorously in Committee.

I now turn to what is not in the Bill. The most glaring deficiency is that it fails totally to address the problem of the decline in Britain's merchant fleet. The Opposition 515 have stated that view more than once, and it is shared by the National Union of Seamen and by the National Union of Marine, Aviation and Shipping Transport Officers. The General Council of British Shipping stated, quite categorically: First, welcome though the proposals for financial aid for training and reparation are, they will not arrest the decline of the UK-owned merchant fleet. If Government and Parliament decide that it is in the national interest — for defence, balance of payments, trade, or employment reasons — for there to be a UK-controlled fleet, manned at least in part with British nationals and available on at least a British Dependent Territory register, much more needs to be done. In particular, action is needed to help shipowners re-invest in shipping when the current aging fleet reached the end of its economic life. That could almost be a synopsis of the Labour party policy put forward in the transport document, "Fresh Directions". It is clearly spelt out on page 21 of the document. The Secretary of State often asks what our policy is, and we clearly spell it out that we want to improve coastal shipping facilities along the lines of Section 8 and Section 36 grants (which provide grants for rail sidings and inland waterway freight facilities. We want to: Provide tax incentives for scrapping older vessels and building new ships in UK shipyards and for use with UK crews. In that, we differ from the GCBS. It says that the ships should be partly manned by British crews. We say that they should be wholly manned by British crews.

We go on to say that we would Create a discretionary scrap only tax incentive, to reduce the surplus of old laid up shipping tonnage. We add that we would Ensure that our shipping policies are co-ordinated with policies to maintain an effective shipbuilding and ship-repair industry. The Government have gone wrong in the past because they have looked at shipping in isolation. It is not as though the merchant marine has suddenly declined. It is not as though the decline has sneaked up on the Government so that they were unaware of it. The decline has gone on for far too long.

The last time that we debated merchant shipping was on 11 March 1986, and the writing was on the wall then. At that time we debated various EEC regulations. I am glad that the loss of tonnage has not been as severe as we forecast at that time, but we cannot take much comfort from that. Indeed, it is rather sad to see that the best headline that the press could produce about the merchant shipping fleet was: Decline in shipping fleet slows down". Decline has not been arrested or reversed; it has only slowed down.

§ Mr. Gregory

The hon. Gentleman seems to be very much a prophet of doom and gloom today. If we were to follow the Labour party's policy set out on page 21 that he quoted, what level of subsidy would be necessary to arrive at that artificial and protective state?

§ Mr. Hughes

If we were in government we would be in a position to decide exactly how far to go.

An interesting convergence of views is developing. Two years ago the General Council of British Shipping was thought to be relatively satisfied with the answers given by the then Secretary of State, the right hon. Member for Cirencester and Tewkesbury (Mr. Ridley). He told us that he could not give us any details, but he did give us a little 516 trailer, as, indeed, the Secretary of State did this afternoon. He did not say that we should wait until the end of the debate, but that we should wait a couple of weeks until the Budget. However, the Chancellor did virtually nothing. The fact that the changes made in the 1986 Budget did virtually nothing for the merchant marine is demonstrated by the fact that, certainly up until September last year, for two years not one British shipowner placed an order for a British ship in the United Kingdom. The Budget did nothing. The General Council of British Shipping now accepts that there must be investment, and investment supported by the Government, in the British shipping industry, and we agree on that.

The second convergence of views is on cabotage. In March 1986 we argued for cabotage to be applied to the British coasts for the reservation of coastal trade to British ships. We include in that offshore vessels plying the North sea oil trade. The then Secretary of State said that that was not necessary, and the General Council of British Shipping said that the best way to go about things was to liberalise on cabotage, and if the European countries who already have it would let us have access to their trade, everything in the garden would be lovely. The General Council of British Shipping is now saying in its document that the time has come when we must seriously think of cabotage.

I was interested to read in the debates in the other place that Lord Gray of Con tin, and another noble Lord, whose name I have forgotten, were arguing about the need for cabotage. The General Council of British Shipping clearly said: more needs to be done to help British coastal shipping. It is unacceptable that so many of our fellow European Community countries—France, Spain, Portugal, Italy and Greece — should reserve their coastal trades to their own ships, which at the same time are able to trade freely in British coastal trades. GCBS would like to see all the Community coastal trades thrown open for competition, but it is clear that other member states will not negotiate away their restrictions whilst they can enjoy the best of both worlds. We believe that the Government should take powers to curb the free-for-all on the British coast as a spur to encourage the negotiation away of all EC countries' restrictions". We shall not achieve that objective. The countries that have cabotage know exactly how valuable that is, but I am glad to have that endorsement of the Labour party's policy, for which we have argued for some years, that cabotage is necessary. I hope that the Secretary of State will now agree that something should be done.

We have been given another little trailer. There are rumours, hints, suggestions in the press that the Chancellor of the Exchequer might agree to some rollover relief on capital investment in British shipping. But that is only a hint. We do not know what it will be. If he lives up to his previous record, it will not be any good to us.

Lord Brabazon said that something needed to be done on a number of matters and that he was concerned about the decline in the shipping fleet. He said that cabotage was a reserve power which remains to be used should the time be ripe. It is no use putting a substitute on with one minute to go, and the Secretary of State should now agree to apply cabotage. We should protect what we have in order to try to move forward, because the situation is perilous.

The hon. Member for York (Mr. Gregory) said that I was a prophet of doom. I wish that there was no need to be gloomy, but I doubt whether any Conservative Member will say what a marvellous buoyant state shipping is in and what a great future it has. No one will say that there is no need to worry because everything is going well and that the 517 Opposition, the National Union of Seamen and the General Council of British Shipping are wrong; that all is going swimmingly. That is not what was said in the other place, and it is not what the Secretary of State said. We must take action soon and swiftly if we are to save the merchant shipping fleet.

I hope that the Secretary of State and you, Mr. Deputy Speaker, will have gathered from my remarks that there is much in the Bill that we welcome, but we believe that it should be probed. We shall not vote against its Second Reading this evening—that would be foolish—but we reserve our position on the Special Standing Committee.

I promise the Secretary of State that he will have to work hard to justify some of the changes that he has made, and he will have to work hard to review some of the changes that we want made. However, I hope that, in the spirit of co-operation, we can make some real progress in Committee, and I hope that we will have a useful debate.

§ Mr. Patrick Cormack (Staffordshire, South)

There is no one in this country, maritime nation that it is, who is not deeply concerned about many of the matters in the Bill. Some of my colleagues may wonder why I, a Member for Staffordshire, am taking part in this debate. I would just point out that I speak as the son of a master mariner and as somebody who has spent more than half his life by the sea and who has sailed with the fishing fleet out of Grimsby. Therefore, I have a little practical experience.

But it is not for those reasons that I seek to intervene briefly today. I wished to catch your eye, Mr. Deputy Speaker, because some time before Christmas I received a letter from Mr. Maurice de Rohan, the chairman of the Herald Families Association. I had not at that stage had the pleasure of meeting Mr. de Rohan but I have subsequently met him and his colleague, Mr. Spooner, and other members of the association.

I was anxious that any help given in Parliament should be on an entirely non-partisan cross-party basis. I immediately enlisted the support of the hon. Member for Birkenhead (Mr. Field) and we have tried to work together. On Tuesday this week we received, together with a few of our colleagues, members of the Herald Families Association and listened to what they had to tell us.

No one who met those people who went through one of the most searing experiences, not only losing loved ones but losing them in circumstances almost too appalling to contemplate, could fail to be moved, not just by the stories of tragedy or the terrible accounts of families rent asunder, but by the quiet controlled passion which they have displayed. This is no group of people bent on vengeance or making destructive criticism.

It would perhaps be appropriate to quote to the House the aims of their association. They say, in the short document that they issued, that the association was established after the capsize of the vessel: It was formed by the bereaved of many of the victims to give mutual help and comfort … It is natural that those who share the same grief should want to help each other. It is as natural that they should seek to ensure that such a disaster as befell their loved ones should not recur. The Association seeks in all its activities to be motivated not by vindictiveness but by the wish to see the lessons of the disaster learned. That is an extremely balanced, moderate statement, and anyone who has met members of the association cannot fail to have been moved by their attitude and approach.

518 I would like to take this opportunity, on behalf of the association, to thank my right hon. Friend the Secretary of State for Transport for what he said this afternoon, for his promise to meet the association's members next week, for his promise to listen carefully to what they have to say and also for the speedy action that he has taken on a number of matters that have given them and us concern. I was particularly grateful for his assurance that the boarding pass will become a legal requirement by the end of February. That is speedy action and we should all be grateful for it.

I would, however, like to concentrate my remarks on one of the principal concerns of the Herald Families Association. In its major document, the association points out that one of its immediate objectives is to have the responsibility of the ferry company—P and O European Ferries, previously Townsend car ferries — determined. The members of the association make out a good case for that but you would rule me out of order, Mr. Deputy Speaker, if I developed that particular theme this afternoon.

The second of the association's major objectives is entirely pertinent and relevant — it is to press for immediate action on the safety and stability of roll-on/roll-off ferries, to ensure that they will sink slowly, enabling normal life-saving practices to be followed. They list a number of those ro-ro ferries which have gone down in minutes or even seconds in recent years. Their document has on its cover a picture of a ferry. One immediately assumes that it is the Herald of Free Enterprise. Not at all, it is the Gateway which went down with, thank God, minimal loss of life in 1982.

My right hon. Friend said that he was devoting money to research. That is splendid. He said that he was most anxious to see that these vessels were the seaworthy vessels that everyone who sailed in them had a right to expect. But there is one point that has already come out in the debate and on which I would welcome further remarks from my hon. Friend the Minister for Public Transport when he replies to the debate. It may be perfectly possible to ensure that never again will a vessel go to sea with its doors open, but if a vessel is holed, as the hon. Member for Aberdeen, North (Mr. Hughes) so rightly said, if there is a collision in the Channel — which is the busiest waterway in the world—and a vessel goes down as fast as the Gateway and the Herald of Free Enterprise went down, there could be further disasters.

As we are entering the era of the giant ferry carrying 2,000 passengers or more, one does not like to contemplate the enormity of the tragedy that could ensue if that were to happen. I hope, therefore, that real attention will be paid to what can be done to make these vessels more seaworthy in all normal circumstances.

Of course, the hon. Member for Aberdeen, North was right to refer to the Titanic. He was also right—in what I thought was an extremely moderate passage of his speech, although I did not agree with all his concluding remarks — to say that there is no such thing as an unsinkable vessel. Nor would the members of the Herald Families Association suggest that there was. But these vessels could be made more seaworthy, perhaps by adopting the suggestions made by the hon. Member for Liverpool, Walton (Mr. Heffer); and, if they could not be made more seaworthy, no more should be constructed. This point has not been sufficiently grasped.

519 On corporate responsibility, my right hon. Friend rightly drew attention to the fact that on indictment a company and those responsible for it can be liable to two years' imprisonment and an unlimited fine. That is all well and good, but there ought to be provision in this Bill for a company's licence to be revoked if it behaves in such an irresponsible way in future. Such a provision cannot be made retrospective, and I stress that neither the Herald Families Association nor I seek to be vindictive. But if we are trying to frame shipping legislation for the 21st century there ought to be real penalties, and they ought to include the ability to revoke a licence.

§ Mr. Frank Field

Will the hon. Gentleman remind the House about our meeting with the Herald families at which they stressed — and I was surprised by the comment—that safety at sea was not regularly discussed at board level? In this Bill and with its penalties, we must somehow raise that issue to board level so that it is considered regularly, not just perhaps once or twice, on occasions when a disaster like this puts it on the board's agenda.

§ Mr. Cormack

The hon. Gentleman is quite right. The families association is right in making this point. I was glad to hear what my right hon. Friend the Secretary of State had to say about the policing of the regulations and about random checks to ensure that they were enforced. That was a most welcome part of his speech, as was his reference to the supervision of ships sailing under other flags.

I have two final points. Looking forward, as the members of the association do, and seeking to envisage what could happen in the event of some terrible disaster in the future — and not just a maritime disaster — the Herald Families Association believes that its members' agony and torment would have been less had there been a national disaster unit, able to respond to this sort of calamity and able to ensure that information was more quickly and accurately supplied. It also believes that if a national disaster fund existed, able to cater immediately for the financial needs of those bereaved, it would be a help. While it is not appropriate for me to expand on those points this evening, I would be most grateful if my right hon. Friend would bear them in mind when he meets the association and if he would pass them on to his ministerial colleagues.

This is a constructive and welcome Bill. The families who have suffered so badly welcome it. Let us ensure that when it leaves this House—and it cannot go back to the other place when it leaves — it is as good a Bill, as unsinkable a Bill, as we can produce.

§ Mr. Peter Shore (Bethnal Green and Stepney)

I can well understand why the Secretary of State began his speech this afternoon by referring to the topic of marine safety and to the appalling background of the Bill, the Zeebrugge disaster. A number of the things that he said in the course of his speech will be very welcome news to the House. I do, however, join both my hon. Friend the Member for Aberdeen, North (Mr. Hughes) and the hon. Member for Staffordshire, South (Mr. Cormack) in stressing that there is a serious subject for further investigation in the design of ferries. We shall not really be wholly at ease with ourselves and feel that we have 520 achieved that degree of seaworthiness which I am sure the industry is capable of attaining unless we tackle the question of ship design and satisfy ourselves that we have the safest form of ferry available.

Another very important factor in this debate is that we are speaking against the background of a continuing and unprecedented decline in the United Kingdom merchant fleet. The extent of that decline is not, I fear, fully appreciated.

From more than 50 million tonnes on the United Kingdom register in 1975—I remember the figure well, and some of the special circumstances, because I was Secretary of State for Trade at the time—the fleet had shrunk to 25 million tonnes in 1982 to 16 million tonnes in 1985 and to under 6 million tonnes in 1987. At least some part of the fleet has been flagged out to the Isle of Man and Channel Island registers and to those of British dependent territories, and a small number of ships have been foreign registered, too. Taking account of all those categories of ships that are still British-owned, however, we have still shrunk from 28.8 million tonnes in 1982 to just under 17 million tonnes in 1987. Thus, in only five years, the number of United Kingdom-owned ships has fallen from 1,063 to 635. No other nation — with the possible exception of Norway — has suffered so catastrophic a decline. While most European fleets contracted in the period 1982–87 — the United States actually increased its tonnage — so the scale of the decline of those nations' fleets is not comparable with our own.

Uniquely, we are an island nation, the vast bulk of whose trade is carried by ships. Of course, major adverse factors have been at work—the sharp fall in the volume of oil trade and the major changes in the pattern of oil trade to which the Secretary of State referred, for instance. He might have added the slump of 1974–75 in world trade, and the further slump that followed another hijack of the oil price in 1979–80. So there were major factors beyond our control, as he rightly said.

However, some of our wounds are self-inflicted. In particular, the abolition in 1984 of free depreciation against capital costs in the form of a 100 per cent, first-year allowance, carried back, as it then was, against profits for the three preceding years, has had a major adverse effect. No other country has abandoned Government aid toward the capital cost of its ships. As up to 50 per cent, of the running costs of a ship relate to the cost of its finance, the effect on our competitiveness has been catastrophic. Any British shipowner now acquiring a ship for United Kingdom registering puts himself at a significant disadvantage. According to the General Council of British Shipping—I have not seen its figures challenged — the United Kingdom now stands 39th in the world order-book league. We have five ships on order with a deadweight tonnage of 51,000. The General Council of British Shipping is aware of no new ships on order for United Kingdom owners for registering outside the United Kingdom. No ships were ordered from August 1986 to September 1987, when one ship was ordered. That compares with orders in the United Kingdom registry of 363 deadweight tonnes in 1983, the last complete year before the 1984 Budget withdrew the 100 per cent, depreciation allowance.

There are, of course, costs other than capital costs—especially crew costs—which determine the competitiveness of United Kingdom ships. Nevertheless, United 521 Kingdom ships are broadly competitive with those of western Europe and operate at substantially lower costs than those of the United States and Japan. Of course, we are massively undercut by flag of convenience operators.

It is against this background that the House should examine the provisions of the Merchant Shipping Bill. While there is much that is useful in the Bill on matters such as registration, safety and the fishing fleet, only a few clauses in part III address the issue of United Kingdom competitiveness and the decline in the British maritime fleet. According to Lord Brabazon, who introduced the Bill in the other place on 10 November last year, Their objective —that of the clauses, that is— is to ensure that the shipping industry remains capable of meeting the nation's essential shipping needs in times of emergency or war."—[Official Report, House of Lords, 10 November 1987; Vol. 489, c. 1293.] He then referred, as did the Secretary of State this afternoon, to the three initiatives on assistance with training costs, the costs of crew changes on ships operating in distant waters and the setting up of a Merchant Navy reserve.

These provisions are contained in clause 25, 26, 27 and 28. I welcome them, as, I am sure, does the House—as far as they go. Just how far is explained in the explanatory and financial memorandum of the Bill. The public expenditure provision for the Merchant Navy training and crew relief costs rises to £3.5 million and £5 million respectively in the full year 1989–90. Costs incurred in relation to the Merchant Navy reserve are thought to be in the region of £1 million a year. In relation to the needs of the United Kingdom Merchant Navy, those sums are peanuts.

I do not see how the Bill can be easily amended to make more adequate provision to assist our merchant fleet, but at least it would be good to learn from the Secretary of State — or the Minister — that he had forcefully represented to the Chancellor the need to resume assistance towards the capital costs of British shipping. I do not believe that the Government or Back Benchers on either side can be, or are, indifferent to the continued decline of the British Merchant Navy.

The cost in terms of our balance of payments is already high. We have moved from a national positive balance in the 1970s to a deficit of no less than £1.1 billion in 1985. I do not know what fleet size and composition the Ministry of Defence believes to be necessary in a period of tension or war, but there must be an irreducible minimum. On present trends, there is no reason why our shrunken fleet of 400 ships should not shrink still further to 200 or fewer in the 1990s. At the very least, I hope the Government will take an early opportunity to present to the House a comprehensive policy to prevent the further decline, and preferably to assist in the revival, of the British Merchant Navy.

§ Mr. Neville Trotter (Tynemouth)

May I say how much I agree with the speech made by the right hon. Member for Bethnal Green and Stepney (Mr. Shore). He was absolutely right to remind us of the continuing decline of the Merchant Navy, which forms the background against which we are reviewing the Bill. I support all that he said about the need for fiscal measures to help the industry. It 522 is relevant that our competitors in the western world are giving assistance of that nature to their merchant navies while we are not.

The picture is one of a fleet that is increasingly flagged out, manned by foreigners and to an underlying extent composed of aging ships. A difficult decision about replacement lies ahead in the near future for the owners of many of the ships remaining on the British register. Coming as I do from a shipbuilding area, I need hardly remind the House how important it is to obtain more orders for that industry. However, that is not the specific issue before us — we are debating the future of the Merchant Navy tonight. I emphasise the need for my right hon. friend the Secretary of State to take to our right hon. Friend the Chancellor the message that he must not delay the introduction of more fiscal measures to help the Merchant Navy, if we want the necessary fleet renewals, without which an aging fleet will in the near future become uneconomic and unable to maintain even its present size in the near future.

It is surely not necessary to remind the House why so many of us think it necessary for Britain to have a Merchant Navy. Apart from the economic argument, it is clear that the defence needs of NATO and of our own country necessitate the existence of an adequate Merchant Navy, as part of the deterrent that we must maintain. It is essential that a potential foe appreciates that we have the maritime capacity to sustain ourselves at a time of crisis. If he believed that that was not so, there would be more temptation to start the trouble that we are seeking to avoid.

I might mention for the benefit of my right hon. Friend that his predecessor in December 1986 referred to inquiries that were being made into the problems of being able—or unable at a time of crisis — to obtain United Kingdom-owned vessels that were flagged out and operating under foreign flags. Would they be available to us in a crisis? My right hon. Friend's predecessor explained it was both a legal matter for this country and also a matter for the other states concerned. I hope that before too long we shall hear what conclusions have been reached as a result of those inquiries. It is a very important issue for the continuing defence and security of this country.

Another important factor is that our merchant fleet should be able to compete fairly with its competitors. In recent years some ships flying the Red Ensign that have been registered in the dependent territories have not complied with our safety standards. That is wrong, and I welcome the proposals in the Bill designed to prevent that happening in future.

I want to refer briefly to the Isle of Man. The Select Committee on Transport, on which I have the pleasure to serve, visited the Isle of Man a few months ago. We were delighted to be told that the Isle of Man authorities are determined to impose on the ships registered in Douglas the same high standards that are to be found on ships registered in Newcastle, London or Cardiff. It is one of the few encouraging signs for our Merchant Navy that the Isle of Man register has taken off successfully as in effect a Red Ensign flag of convenience.

Coming from North Shields, I very much welcome anything to do with fair competition in the fishing industry. While North Shields vessels have not been the main sufferers as a result of the activity by the Spanish in the southern Channel area, it is right that we should prevent the abuse of the registry system that has occurred 523 there. Foreign-owned vessels must not be allowed simply to transfer to the Red Ensign so as to obtain part of the United Kindgom quota of scarce fish. I congratulate my right hon. Friend on taking measures to correct that abuse.

I want to ask my right hon. Friend some questions about the new registry of fishing vessels. I believe that it is proposed that there should be a central registry for fishing vessels instead of the 90 or more port registries that exist at present. I hope that my right hon. Friend will appreciate that fishermen in North Shields and elsewhere do not want to go to Cardiff or deal with officials in Cardiff in order to obtain registration in future. I hope that there will still be officials in the local ports with whom the fishermen can deal and I hope that boats will continue to display the registration letters and numbers of the local ports around the coast as there is a great deal of pride in this local identity.

One of the greatest problems facing the Merchant Navy is caused by the low wages paid on so many of our competitors' vessels. Those vessels are manned by people who are, on the whole, satisfied with their wages because they are being paid the going rate in their own country. Undoubtedly, this is one of the main problems facing our operators at a time when world freight rates are actually less than they were seven or eight years ago. There is no margin to carry unnecessary costs.

The Bill contains welcome proposals, but I fear that they are rather modest when compared with the overall scale of the problem.

The new scheme for assistance for training will be helpful. It is a fact of life that so many of our competitors in the western world do not have to find the high cost of training as do owners in this country. For many years there has been an excellent marine college in South Shields on Tyneside. It has been very disturbing to see the constant fall in the number of young men entering the college for both deck and engine cadetships. There is now a shortage of cadets and I hope that this welcome measure will end that problem. I hope that more can be also done using existing schemes such as YTS or the Manpower Services Commission to assist in tackling the problem.

With regard to the repatriation of United Kingdom crews, I was interested to be told recently by the owners of a United Kingdom registered cruise ship that when she went on a round-the-world voyage the cost of the air fares for changing the crew en route amounted to £1 million. That is the level of burden that such ships carry to provide a British crew. However, such ships of course also have the great advantage of the highest reputation for the standard of service on board. The measure will be helpful in matching the competition with their lower costs of manning.

The Bill contains a welcome proposal to establish a Merchant Navy reserve. There is considerable debate whether in an emergency we would be able to obtain the ships that we would need. It can be argued that unless the crisis was worldwide, there would be ships available for purchase if we paid enough for them. I would, however, have been happier to see an additional proposal before the House to establish a reserve not just of men but of ships anchored in our waters. The United States has adopted that policy. It is taking advantage of the low price of modern secondhand vessels and has bought nearly 100 524 ships which are kept at anchor and which could be put into service in a day or two should a crisis occur. We should do that in Britain.

The number of sailors on the Merchant Navy register has fallen from 50,000 to only 25,000 over the past five years. There are probably also almost 7,000 British sailors serving on foreign-flagged ships. Unless we take steps now, United Kingdom sailors to man our ships in a crisis will simply not be available and the new reserve of men is timely.

Has my right hon. Friend the Secretary of State any idea yet as to how long it will take to establish the reserve? What kind of training will be available? As I understand it, the reserve will consist of former seamen who will state that they are willing to be recalled to the colours in an emergency. As time passes, they will tend to become rusty and there must surely be a system to provide regular refresher training.

I want to refer to unfair restrictions on the market. We have always believed in free trade at sea, and quite rightly so. That was the whole basis for the birth of the Merchant Navy, which involved the carrying of other people's cargoes around the world. Many British companies are still satisfactorily and effectively doing that today. However, 79 per cent, of the weight of cargo coming in and out of the United Kingdom is now carried on foreign-flagged ships and by value the figure is 64 per cent. We can see the temptation of suggesting that we should think of protectionism. However, that is not the answer and it is not what the General Council of British Shipping is asking for. It is right that we should have free trade on the seas and we can benefit from that. However, it is essential that the rules are fair and that our people are not discriminated against as they increasingly have been. I therefore welcome the new powers sought in the Bill to counter unfair competition.

Finally, I want to refer to the problem of cabotage and to coastal trading around this country and neighbouring coasts of Europe. Different rules seem to apply. Our coasts are open to all, yet a number of our important neighbours' coasts are not open to our ships. That is very unfair and I am sure that my right hon. Friend has that point very much on board.

§ Mrs. Ray Michie (Argyll and Bute)

I also welcome this necessary Bill. I appreciate the fact that the Secretary of State, like other hon. Members, started by referring to the safety aspects, and we would not expect anything else. We all appreciate that they are so important following the Zeebrugge disaster and tragedy.

I want to draw the Secretary of State's attention to several safety aspects to which he referred with regard to ferries which differ from the ferry involved in the Zeebrugge tragedy. I want to refer to the ferries serving the Scottish islands. I hope that the right hon. Gentleman will not insist that a six-car ferry should require closed circuit television, when the whole length of the ferry can be seen from the bridge by the master. Perhaps a little money could be saved in that way. I believe that the deadline for installing emergency lighting is July 1988. I am not sure whether approved equipment exists at the moment. Therefore, there could be a problem in meeting that deadline.

Reference has been made to the registration of fishing vessels. I have a particular interest in the part of the Bill 525 that deals with that registration, as fishing is an integral part of the life of many communities in my constituency. Part II provides for a new system of fishing vessel registration which, I am glad to say, would do away with the ability of non-United Kingdom vessels to flag into the fishing fleet and enjoy British quotas. I am glad that the Government have responded to the need to ensure that those quotas are taken up only by United Kingdom fishermen, as they have been fought for long and hard over the years.

The Scottish Fishermen's Federation, which includes the Clyde Fishermen's Association — of which I am proud to be honorary president—holds the view that, if the exploitation of quotas by non-United Kingdom interests is to be eliminated, all loopholes must be closed. The registration of fishing vessels for title may be a matter of concern. Possibly it is peculiar to Scotland, and it is probably an issue for the Committee to consider. I believe that at present there is an option on whether a boat is registered for title, but in Scotland such registration is recognised custom and practice.

Another point of concern is the lack of definition on when the old fishing vessel register will close once the new one has been opened. While it is accepted that both registers will run concurrently for a time, it is important that a limit should be imposed, perhaps of four or six months. The federation stresses that that will be necessary if the new register is to be a success.

The administrative arrangements for the register have already been mentioned. Although I believe that they are being centralised in Cardiff, I nevertheless welcome the Government's recognition of the need for business to continue to be conducted personally at local offices, because local knowledge and expertise must not be allowed to disappear. I was reassured by the answer given by Lord Brabazon in another place that officers will be retained in many ports, including two in my area, in Oban and Campbeltown.

The Bill provides for financial assistance with the costs of training Merchant Navy officers and rating. However, as has been mentioned, there is no word about assistance for training in the fishing industry. We should give that some consideration. The Sea Fish Industry Authority has provided only limited support, and that is not guaranteed beyond March 1988. Many fishermen are already undertaking training for survival courses, and it is surely reasonable that that branch of the maritime industry should receive some support.

I was interested in the Bill's definition of a fishing vessel as a vessel used … for or in connection with fishing for sea fish. According to the Bill, 'sea fish' includes shellfish, salmon and migratory trout (As defined by … the Fisheries Act 1981)". I am sorry that eels in inland waters in Scotland are classified as freshwater fish, because they are at the mercy of foreign companies that come over and fish out all the eels, leaving our own eel fishermen with the thought of the dole. That is a tragedy, and I really do not know why eels should be so classified. Perhaps someone will consider the eel fishermen's plight.

I see no provision in the Bill that makes a serious attempt to arrest the decline of our once large, and always proud, Merchant Navy. Although the financial assistance for training and repatriation is welcome, it will not halt the 526 decline of the fleet. I believe that what is required is a package of measures that will put us on more of an equal footing with our competitors.

The deep concern of many of my constituents about the decline came to light during the last election, when attitudes ranged from astonishment to downright disbelief that this island country could have allowed such a rundown in our fleet. While a Merchant Navy reserve sounds very laudable, I believe that a greater determination to have a viable merclant fleet crewed by United Kingdom seafarers would obviate the need for such a reserve. The continual "flagging-out" has meant that fewer and fewer people have come forward to be trained, and the danger is that we shall soon find ourselves without enough pilots or harbour masters, or enough crews for cross-channel ferries, Caledonian MacBrayne and the large ships criss-crossing the world's oceans.

I was delighted to learn that a company in Glasgow, Clyde Marine Training, which has 12,000 British seafarers on its register, set up a training schedule only last March. The company managed to attract 50 youngsters to train this year, and hopes for another 100 next year. The young cadets come in with O-grades, the Scottish equivalent of O-levels in England. With the use of existing finance through the Manpower Services Commission, the cost to the shipowner is very much less — about £6,000 over four years—whereas previously it was £25,000 per cadet over four years.

I referred to the interest of my constituents. That interest extends to the whole of the highlands and islands area, for it was a tradition stretching back to the first world war that crofters and fishermen left the land to join the Merchant Navy in far greater numbers than ever joined the Royal Navy.

During the depression of the 1930s, when unemployment was so high, highlanders used to come to Glasgow and join the long queue in Jamaica street, where stood the men on the dole hoping to join the Merchant Navy But, because of their fishing and seafaring experience and tradition, those highlanders were often taken out of the queue and given jobs straight away. There is a wealth of knowledge, expertise and dedication among our people. It would be a tragedy if this country were to suffer any more loss, or see any further decline in our fleet and in the crews who man it. I give the Bill a general welcome.

§ Sir David Price (Eastleigh)

I detect a desire to make progress, so I shall be as brief as I can. In doing so, I declare both a constituency and a personal interest in the fortunes of the British Merchant Navy.

This is a miscellaneous Bill containing all sorts of different clauses. It therefore lends itself particularly well to study and debate in Committee. On the Opposition point on whether a Special Standing Committee should deal with it, I should mention that, as I understand the rule applying to such a Committee, it can have only four sittings.

Let me put forward an alternative suggestion. It might be an education for those of us selected as members of the Standing Committee to go and look at a few ferries, with the safety angle particularly in mind. Perhaps we could pay a visit to the ship tank at the National Physical Laboratory to examine hull designs and other such matters. The alternative would be to set up a Select Committee so that 527 we could have proper assessors and advisers. However, I think that that is outwith the scope of what is being proposed.

I should certainly be sympathetic to any thought that we might have, as it were, hands — on experience of ferries, rather than just talking about them. In the normal Select Committees on which I have always served, I have found that the visits outside Westminster are often more valuable than the formal evidence that we take here.

I am asking almost the same question as the right hon. Member for Bethnal Green and Stepney (Mr. Shore) and my hon. Friend the Member for Tynemouth (Mr. Trotter), which is: will the Bill assist in reversing the dramatic decline in the size of the British merchant fleet? We must all ask ourselves that. As the House knows, I have found myself in the unhappy and uncharacteristic position of having to warn the House about the steady decline in the size of the British Merchant Navy. I do not enjoy the role of Jeremiah—to be quite honest, I do not think that it becomes me. However, I fear that the figures quoted by the right hon. Member for Bethnal Green and Stepney have proved that, unfortunately, one's fears were correct. The right hon. Gentleman quoted chilling figures to the House, which I shall not repeat.

The question that we must ask ourselves is the one to which my hon. Friend the Member for Tynemouth assumed that the answer was generally accepted: do we need a Merchant Navy? I should like to suggest briefly the headings, without developing them, for the reasons why I believe that it is absolutely essential that we have a Merchant Navy of reasonable size. The first, which has been touched on, is national security, not only during war but in situations of emergency that are short of war. All the evidence — again I shall not attempt to detain the House — shows that the total availability of merchant ships to the whole of the NATO Alliance has been steadily declining. That includes those ships that are flagged out to dependent territories and can be reached, and those under Liberian and Panamanian register. It is a matter of serious moment.

The House must remember that in our case the Merchant Navy is asked to fulfil three roles. The first is direct support for the armed forces. The second is the provision of transport to continental Europe which, in the jargon, is called sealift. The third is to ensure civil resupply of our island economy and, indeed, of western Europe from across the Atlantic or anywhere else. That alone gives cause for deep concern to anyone who cares not only about the Merchant Navy but about the defence of our country. There is also the economic question of control over our own trade. Again, the right hon. Member for Bethnal Green and Stepney quoted some figures so I need not detain the House, although I wish to make the point that we should control our own trade. Furthermore, the balance of payments argument is a little too lightly swept away.

In those circumstances, where do we look for improvements? I suggest that there are two areas: first, measures to help reinvestment and, secondly, measures to assist with running costs. Again, the right hon. Gentleman quoted figures showing the dramatic fall in reinvestment in new vessels since 1984. There are various ways in which the position could be restored. At the moment, the preferred solution is roll-over relief for balancing charges.

528 However, there should be no doubt that unless the Chancellor restores some form of investment incentive to British shipowners, we shall not get the ships. I hope that my right hon. Friend will talk to the Ministry of Defence and especially to the admirals about that.

I do not want to tell stories out of school, but when one meets some of the admirals informally on the various all-party maritime groups, one realises that they are clearly concerned about the decline in the British and the NATO Merchant Navies. However, they are fearful of the Treasury and that if anything were done to assist investment in the Merchant Navy it would somehow have to be paid for on the naval Vote. The admirals are a shrewd lot. I repeat that unless something is done we shall not have the necessary Merchant Navy back-up for the Royal Navy.

Referring to assistance on running costs, we are delighted to have aid for training costs—we shall discuss that more in Committee — and for repatriation. However, there is also the question of income tax for seafarers and the problem of social security changes and the like, all of which, in different ways, get more favourable treatment from other western European Governments, let alone what happens in the Far East.

We should not be too purist. We should look at what happens in the real world and see whether we can adapt it. I understand that the European Commission is giving serious consideration to some such measures of relief which would have general application. I hope that our Ministers who go the Commission will give such proposals their welcome and support.

Clauses 27 and 28 deal with the Merchant Navy reserve, which we welcome. However, it is no good having a reserve of sailors if there are no ships for them because, surprise, surprise, just as ships need sailors, sailors need ships. We do not have sufficient ships that might be available to the reserve. We also need the right mix of ships because it is a question not just of tonnage but of the right tonnage. I suggest that my right hon. Friends consider setting up a Merchant Navy strategic reserve. Time forbids me to go into that in detail but no doubt we can do so in Committee. However, it is a well-known concept and means doing the same for merchant ships as the Royal Navy Reserve does for officers and seamen. We must also consider the alternative of a crew-related allowance for those who take on extra reserve commitments.

I welcome clause 37, but in Committee we shall wish to probe my hon. Friends on precisely what it means. I put in a plea for us to take tougher powers to deal with other European countries over cabotage. I give notice now that I intend to table amendments to strengthen that part of the Bill. In such matters we must play to what I would call "French rules" rather than to the letter of the treaty of Rome. French rules were well illustrated when my right hon. Friend the Member for Worcester (Mr. Walker) was Minister of Agriculture, Fisheries and Food. Then we were threatened with being flooded with highly subsidised frozen turkeys, which would have upset turkey farmers in this country. Quite rightly, my right hon. Friend's veterinerary surgeons discovered the risk of a rather obscure turkey disease. That worked admirably and was within the law. I call that playing to French rules. The French play to the rule that they never do anything internationally that is not perceived to be in the interests of France. It is a question of all animals being equal, but French animals being more equal than other animals. Of 529 course, we wish to have free access around the coasts of Europe — that has been our steady position — but it is not happening. Incidentally, the Greeks are every bit as bad as the French, and probably worse—

§ Mr. Channon

They are worse.

§ Sir David Price

Yes. My right hon. Friend says, "They are worse"; and that affects the cruise trade. Therefore, I beg my right hon. Friend that in the matter of cabotage we play to French rules.

§ Mr. Terry Fields (Liverpool, Broadgreen)

When we debated the ministerial statement on the King's Cross fire, I was moved to say that it took tragedies such as that to prompt the introduction of legislation. We have discovered that with other legislation dealing with the fire service, which followed the death of firemen and civilians. I doubt whether we should be discussing amendments to a law introduced in 1894 had it not been for the death of nearly 200 people in the Herald of Free Enterprise disaster a short time ago. As my hon. Friend the Member for Aberdeen, North (Mr. Hughes) said, the importance of this debate arises from the fact that we are not likely to be in the game of making further changes to merchant shipping legislation or discussing it again this Session.

Two hundred lives have been lost, and in discharging our duties and responsibilities we must take every step to ensure as far as humanly possible that a repetition of the disaster is avoided—albeit in the confines of the concept that it is impossible to ensure 100 per cent, safety in any walk of life.

We are amending the Act, and any positive change is good. However, we must ask ourselves how good it is, and the importance of the task on which we are engaged will be reflected in the legislation, which should secure the safety of life and property and ensure the future of the British merchant fleet.

In the debate in another place last year the Parliamentary Under-Secretary of State for Transport said of the Pilotage Act, which was a forerunner of this Bill, that it provides a framework within which an industry with proud traditions can adjust to modern circumstances and operate more efficiently." — [Official Report, House of Lords 10 November 1987; Vol. 489, c. 1292.] It is important to bear those matters in mind.

I shall centre my remarks on a number of key issues. There is admirable scope, even in this debate, to consider valuable amendments to stiffen up the Bill, which is somewhat suspect in certain aspects. For example, there are anomalies about registration. I shall not wave a racist flag, but, in the interests of the safety of the crew and passengers of ocean-going vessels, we should ensure that vessels sailing under the Red Ensign are covered by legislation that ensures safety, protection and a good standard of shipping. Gibraltar has 150 registered ships. Gibraltar is part of the dependent territories, but last year it had no inspectors to police international regulations. It now has two inspectors—hardly sufficient to cope with the needs of a fleet of 150 ships. Those ships can fly the Red Ensign and thus, in the view of Merchant Navy officers, bring the Red Ensign into disrepute because of the lack of safety measures on those ships. Foreign-owned ships with foreign crews registered in Gibraltar under the so-called protection of the Red Ensign go to the Gulf and 530 elicit the support and protection of the Royal Navy. We need to tighten up the Bill, and I am sure that we can make amendments in Committee to do so.

Last week I met members of the Herald Families Association. One of the deceased was an old friend of mine, and I therefore have close contact with the family and the association, which made a parliamentary sortie last week. I support the families' view. They are not vindictive. In framing legislation, we have a responsibility to ensure that there is no repeat of the tragedy visited on those families. I believe that we could take other measures in that direction.

The Merchant Navy officers have sought to separate the master from the owner-manager so that the master remains responsible for acts of omission over which he has control. However, the Bill deals with the provision of a suitable ship and suitable equipment and crew, over which he has no control. In those circumstances, there must be a divergence of responsibility and we must insert into the Bill that divergence of responsibility, by means of suitable provisions, to ensure that the law is observed by all concerned.

The demise of the merchant fleet in this country has been referred to. Tonnage has dropped by 64 per cent, in 10 years. In the same period the number of seafarers employed has dropped by 62 per cent.—from 80,000 to 30,000. Of the 500 deck and engine officer cadets employed in the industry, only 107 serve on British flag ships. That is a critical situation.

As has been said, if we cannot legislate for safety, there are certain other things that we can do. We can ensure that owners of shipping fleets have responsibilities and discharge those responsibilities, and that discussions on safety take place in company boardrooms, as they have not done hitherto. It is one thing to pass legislation: we must ensure that it is adequately policed. We must ensure that there are inspectors to check that what is laid down by Parliament is practised by the companies.

The Herald of Free Enterprise disaster was predictable, following as it did the Gateway disaster. Companies could have looked at recent history. Seventeen such vessels have sunk — the Gateway in a couple of minutes and the Herald of Free Enterprise in four. Companies should have acted positively, rather than merely responding to circumstances.

We must be very clear about what we are discussing in terms of the stability of vessels. We shall need expert advice if we are to ensure that our vessels have that stability. In the last two episodes, two ro-ro vessels went down in a matter of six minutes, collectively, with a loss of human life. That must mean that there is something wrong with the design of the vessels, and we need to correct that design fault. Hon. Members have talked about the use of the marine f