Select Committee on Environment, Transport and Regional Affairs Appendices to the Minutes of Evidence

Memorandum by Lloyd's Register (FUS 8)

  Lloyd's Register firmly believes that a strong UK merchant fleet—both in terms of the ships and shipping operations based in this country and the skills and resources that these provide for other businesses—is vital to the UK as a whole.

  The City has the largest concentration of maritime services and expertise in the world, built originally on the basis of a strong national fleet. These include marine insurance, protection and indemnity, shipbroking, ship sales, banking, maritime law and arbitration and ship classification and are a major contributor to the UK's balance of payments through the "invisible" earnings they generate.

  For Lloyd's Register and the business of ship classification, the very large reduction in the merchant fleet and in shipbuilding in the UK has meant an enormous loss of the advantage we once enjoyed versus our major competitors in Norway and Japan.

  As a result we have had to look to our international network to find the experienced resources and shipbuilding markets required to maintain our premier role in ship classification. At the same time we have increased our intake of young graduate engineers and naval architects in the UK to make up the deficit in numbers of mature experienced UK staff and set up a special four year training scheme leading to chartered engineer status.

  However, despite success in finding qualified staff overseas, the supply of experienced recruits from the remaining operations in UK is still extremely important to us; not least to provide the practical skills base for further on-the-job training for the young graduates who are now a significant part of our recruitment programme.

  There is also the possible danger of a reduction in this limited resource of young graduates if UK shipping is allowed to decline since our universities may well be forced to cut back on the relevant courses in naval architecture and engineering as demand for university places follows that decline in shipping.

  In summary, the leading position of Lloyd's Register depends on the continued existence of a strong UK shipping industry, not only for the direct work it creates but the infrastructure it provides for our operation.

  This includes, among other things, education and training facilities together with research and development. Without this infrastructure and the engineers and naval architects it requires and delivers, our organisation could not survive in its present form. As a result we would need to move the core of our marine operation, including most HQ functions, out of the UK to where the shipping industry was of the size and strength to meet our requirements for educated and trained staff and a supporting infrastructure.

Patrick O'Ferrall OBE


1 December 1998

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