Examination of Witnesses (Questions 60-79)
WEDNESDAY 19 NOVEMBER 2003
SIR JOHN
HARMAN, MR
CRAIG MCGARVEY
AND MR
DAVID JORDAN
Q60 Patrick Hall: Just to be absolutely
clear, who applied for the trans-frontier shipment of waste notice?
Mr McGarvey: MARAD.
Q61 Patrick Hall: When?
Mr McGarvey: They contacted us
before July but they made the application at the beginning of
July. It was issued on 22 July.
Q62 Patrick Hall: So 1 July. Can
that be confirmed?
Mr McGarvey: I can confirm the
date. On 26 June they made the formal application.
Q63 Patrick Hall: Was that the first
that the Environment Agency was aware of this proposal?
Mr McGarvey: No. There were some
communications earlier in the year. In February there was a communication
from the company saying "We are thinking about dealing with
ships", although they did not make any reference to this
contract or where they were coming from, just asking some questions
about their licence. Then it was a month or two later that they
started to come forward and say "We think we have got a contract"
or "We are in the process of getting a contract for these
vessels" and we began to become aware of the US fleet, the
MARAD ships. The vessels still belong to MARAD, they are owned
by MARAD until they are completely disposed of, and they are MARAD's
responsibility.
Q64 Patrick Hall: Presumably part
of the information provided in making the application is the nature
of the company that is going to deal with the recovery, is that
correct? So was Able UK identified in the application?
Mr McGarvey: We want to know who
the waste is coming from for recovery and we need to know where
it is going to for disposal. Yes, MARAD were the people who had
the waste and they were sending it to Able UK. What they provided
to us in the application pack for this trans-frontier shipment
notification was the contract between the two parties, which is
fairly extensive, and it was that that we analysed as part of
the process.
Patrick Hall: You said earlier that when
an application is made you go through a number of questions, what
it is for and that there is a financial guarantee in place, the
capability of dealing with the recovery is actually in place.
It is on the latter point I want to ask you because that is where
it seems to me that we have got into all of these difficulties.
It does worry me that you said that the Environment Agency does
not check with every applicant that everything is in place before
making a decision. It is on the record that you said that. Surely
there are lessons to be learned even at this stage, and this issue
has not unravelled fully yet. Why not ensure that the technical
capability to do the job is actually in place on the ground before
issuing any permission of whatever kind? In other words, if a
dry dock is needed, that the dry dock is there, not just that
there is a planning permission for the dry dock, and in this case
there was not the planning permission for the dry dock either.
Why not think about an interim statement of intent from the Environment
Agency that says, "Yes, this sounds okay provided certain
conditions are met and are in place" because how can it be
acceptable for these ships to set sail without the dry dock being
in place ready to receive them?
Q65 Chairman: I think our witnesses
have got the message. Mr McGarvey?
Sir John Harman: I think it might
as well be me actually. I think you have to ask yourself what
are the options. As Craig pointed out, at the point the application
was received—it was not the first we heard of it—you
have then a period of 28 or 30 days, whichever it is escapes me
but it is that sort of timing, in which to object or to refuse
the application otherwise it is deemed to be granted. It would
be nice to think there was another choice whereby you could say,
"Well, can you leave this. We will not determine this until
we have absolutely everything in place" but in fact once
you have received the application you have to determine one way
or the other 28 to 30 days. The question you have to ask is do
you want the regulator to take a common sense view or to take
a very conservative view?
Q66 Mr Wiggin: Same thing.
Sir John Harman: From Able UK's
point of view there are two environmental licences to be obtained,
we have mentioned them both. There are two licences under the
Food and Environment Protection Act which are to do with dredging
and going into the estuary bottom; there is permission from the
Crown Estates; there is permission from HSE; there is planning
permission—I nearly forgot that, how could I. There are
a range of different regulatory bodies in play here. Each of them
could say exactly the same, "No permission until everything
is lined up". We do not regulate in that fashion. I believe,
and I have looked at this in some detail, that my officials were
correct to take a common sense view that the planning permission
was, as far as they were concerned in July, extant, that it was
a condition of the waste management licence that the disassembly
had to be done in dry dock, very clear about that. We had no reason
to refuse the TFS, I think it would have been unreasonable so
to do.
Mr McGarvey: Can I follow up and
elaborate. The point you raise is a very good question. How do
the Agency issue these permits without understanding some of the
planning permission issues? The time we do that is when a new
waste management licence is applied for. When a new waste management
licence is applied for, at that point we cannot issue it unless
planning permission is in place and that is the time at which
we do make sure that all those things hang together. Hence you
can understand in this situation the company had a waste management
licence, and those checks have been gone through at that point
in time, and it is not uncommon later on down the process with
lots of companies for us to modify their waste management licence
when planning permissions have lapsed. For example, with a landfill
site that is now being closed and being remediated, planning permissions
might be in a completely different position but we would still
issue modification, we would not go crawling back over the planning
issues. Just to try and give some comfort around the fact that
there is a connectivity between planning and decision making and
we do not just pay no regard to it.
Chairman: I am stopping you there, if
I may, David wants to come in and then Joan.
Q67 Mr Drew: Can I be absolutely
clear about how much experience you have had of this process before
this particular case? This is a new area I am led to believe we
have got into, we want to know really did you have the robustness
of a process in place before you tried it out for real? I would
be very interested about the international context of this. I
was in Chittagong last year where I saw the alternative way in
which we break up ships. Is there an international pressure now
to legitimise the ship dismantlement? Is this part of the process
that we will now be going through much more in the future for
the reasons, the numbers, you gave us some indication of? What
would your experience be from what you have learned from this
case?
Sir John Harman: It is an excellent
question and I think it is one where the Agency itself cannot
expect to give a whole answer. The framework within which ship
dismantling is to take place, what is best practice, how is it
assured is I think something which has to be addressed in policy
terms. I will ask David Jordan to talk about how frequently we
deal with just this kind of example.
Mr Jordan: We deal with a good
number of TFS shipments every year. Usually these are shipments
of materials which are contained as cargo. In this particular
case it was very unusual because it was ships themselves. As Craig
said earlier, we have a national team which deals with the front
end of transfrontier shipments and that is to bring all that expertise
together in one place and there are some very seasoned professionals.
However it is true to say this has been a very unusual set of
circumstances and it is, I believe, testing international law.
Now I am not a lawyer and I will not, with your permission, try
and answer this from a legal perspective.
Q68 Chairman: You could tell us what
is unusual because that has really whetted our appetites.
Mr Jordan: It is unusual, as I
said, because normally transfrontier shipments are things being
carried by something. It is a ship with a container of a material
which is then brought off and disposed of. In this particular
case it was the ships themselves which set something of a precedent,
not only that, it is a significant issue of scale. There are extensive
discussions going on in the international community at a wide
range of levels talking about how waste should and should not
be moved between countries, that is very complex and I would struggle
to answer that precisely but there is a lot of discussion going
on at the moment. I think this is a critical issue, however, because,
as was mentioned earlier, there are new laws which will require
single hulled and modified single hulled tankers—and these
are not those by the way—modified and unmodified single
hull tankers will need to be brought out of commission in, I think,
2005 and 2015 respectively. There are something like 2,000 of
these ships in Europe that will need to be dismantled in a very
responsible manner[2].
Getting a better grip on some of the international implications
I believe is essential.
Q69 Joan Ruddock: I was trying to
follow up on some of the points Diana made because I am still
not clear. Sir John has given us the impression that in a sense
you are obliged to give this permission in the circumstances you
described yet you made conditions but it appears you had no intention
of finding out if those conditions had been complied with, ie
they are allowed to sail. Planning permission even if it was extant—and
we do not know if it was—we are all familiar with planning
permissions that never produce the goods. Did you have any idea
how long it was going to take to produce this dry dock? Did you
have any plans to check that the dry dock was in place and if
you say the responsibility lies with the US and they should not
have allowed those ships to set off at the point at which they
did, does that mean that all liability now lies with MARAD and
not with anybody else in these countries?
Sir John Harman: I do not want
to make a statement about liability in general because it seems
to me on the face of that that the question is capable of being
split into liabilities of various sorts, and I think I cannot
generalise about them all. I will ask one of my colleagues to
contribute here but I am sorry if I gave the impression that we
had not checked the situation. Mr Hall suggested that perhaps
it would be better to wait until things are physically in place,
in practice that is not what happens. I think it is too rigid
a test to apply. Certainly it seemed to us, it was our understanding
that planning permission existed, that it was the intention of
the company to undertake these works, that was the basis upon
which the TFS was granted, yes there was an option for us to refuse
the TFS. Would that have been reasonable and proportionate at
the time? Well, I think in the light of the evidence in front
of the officials at the time it was reasonable to permit it, it
would have been unreasonable to refuse. Here we are talking about
the intent of the applicant. Now, it is the responsibility of
the applicant, Able UK and MARAD between them as contracting partners,
to line up the ducks in the row which Mr Mandelson talked about
in his evidence. It is not the regulator's responsibility but
I think that we took a wider view of our responsibility than just
sitting in our regulatory role and that is why it was the Environment
Agency that first of all, as Craig said, drew the regulatory bodies
together, informed MARAD that in our view by the time it became
clear planning permission was in dispute—still is in dispute
so let us leave it at that—that there did not seem to be
the prospect of, as it is called, completing the TSF. The advice
was not taken, two ships are now in Hartlepool. What are the options
now? They are to repatriate the ships or to find a way of recovering
them, presumably along the lines that we originally asked for.
I said at the beginning of my evidence that it is the environmental
outcome that we have had our eye on all the time. What we have
ended up arguing about is the technical legalities of the licensing
procedure.
Q70 Joan Ruddock: Can I question
you on the technical legalities because you are saying in order
to do the job and have the right environmental outcomes there
had to be a dry dock.
Sir John Harman: That is not a
technical legality. The technical legality I had in mind was this
dispute that went to judicial review about the waste management
licence.
Paddy Tipping: I bet you have got big
files on Able on this matter and I bet it is a growing file. Mr
McGarvey, I think you told us earlier on that it is the case that
on big planning applications the EA are consulted and you would
have been consulted by the TDC at the time of the original planning
application in 1997. What do your files show about the planning
application? Did it go through?
Q71 Diana Organ: Is it extant?
Mr McGarvey: In fairness, I do
not think that is a question for us to answer.
Diana Organ: They have lots of other
files.
Q72 Paddy Tipping: I am asking you
about your files.
Mr McGarvey: For completeness,
in terms of the modification to the existing waste management
licence that was applied for by Able, as part of that process
we do consult the local authority. The question we were asking
them was "In relation to this modification, can you advise
us whether there are any planning matters that would be contravened?"
That question was asked of Hartlepool and in that narrow perspective
they responded that there were not any issues.
Q73 Chairman: They replied what?
Mr McGarvey: They replied that
they had no objection to the modification because it did not contravene
any of the planning matters as they saw them at that time.
Q74 Paddy Tipping: Back in 1997 you
were consulted and you gave advice. You must have things on file.
Subsequently you consulted Hartlepool about the modifications
and they said, "No, there are not any real problems".
That is all correct, is it?
Mr McGarvey: Yes.
Q75 Paddy Tipping: What are relationships
like with Hartlepool Council now? How are you going to sort this
out? If Mr Mandelson is right and the Government needs to come
in and use its diplomacy and its push to sort this out, are you
in a position to talk sensibly now to the council?
Mr McGarvey: We have a very good
working relationship with the council. I have no doubt that we
can continue to work positively with them. I do not think that
is an issue for us.
Q76 Alan Simpson: In your opening
remarks you mentioned that there is a range of international regulations
that you have to comply with. I am sure you will be much more
aware than most of the Committee about the EU regulations that
constrain waste shipments and its recycling. Can you tell me,
when you considered the original application did you believe that
you were in compliance with Article 19.3 of the EC Regulation
259/93? It is the one that states that: "The applicant has
to present a duly motivated request to the Member State on the
basis that they do not have, and cannot reasonably acquire, the
technical capacity and the necessary facilities in order to dispose
of the waste in an environmentally sound manner." Effectively
you made an assessment of the US capability of reprocessing its
own waste and came to the view that they are not technically capable
of doing so.
Mr McGarvey: First of all, I have
not got the Directive you refer to in front of me, nor am I a
lawyer, but I think what you are referring to is disposal of waste,
for which the Committee have already referred to something called
the proximity principle, and the proximity principle says if it
is your waste dispose of it at home unless you can demonstrate
to another member of the developed countries that you have not
got the capacity. The proximity principle does not apply in this
case because this was movement of waste from the United States
for recovery. That was one of the first tests that it had to pass
before we would give the TFS approval. If it had been waste to
come here to be disposed of and got rid of, or put into landfill
or incinerated, then the proximity principle would have applied
and we would have said no, unless I suspect, as you just indicated,
they would then go through a process of demonstrating they had
not got that capacity. This was waste for recovery, not for disposal.
Sir John Harman: I do have Article
19 in front of me and it is imports of waste for disposal.
Q77 Mr Wiggin: You said at the beginning
that your whole ethic was to consider the environmental risk.
You then tried to stop the ships. You have now got the worst of
all worlds and we have got the ships here and your credibility
really is in tatters. What are you going to do next?
Sir John Harman: If I can go back
to the second part of that question. You say we tried to stop
the ships and you connected that with our aim, as you quite rightly
quoted back to me, of ensuring that the right environmental outcome
is obtained. The reason why we concluded the ships had to be,
ought to be, sent back (and indeed in the end they were not, but
that was our advice) was because we had come to the conclusion
that the waste management licence was not properly made, not that
we had come to the conclusion that the environmental consequences
of the method proposed for recovery was suddenly at fault. So
we have not changed our mind on that latter part at all. What
we want to happen now is that this issue about whether recovery
can take place in the UK is resolved and that will take the resolution,
which is largely a matter for the company to initiate, of the
various regulatory issues but principally the dispute about planning.
It will now require, I am advised, also the agreement of the European
Commission for that to happen because the trans-frontier licence
has not been completed. The alternative is repatriation. The Agency's
view would be that proper recovery, properly regulated, would
be the preferred outcome to all of this.
Chairman: I have let the questioning
run slightly in a fluid fashion because there were natural lines
of thought that were occurring and they needed to be followed
up, but I would now like to return to a more structured discussion.
If my colleagues would resume their places in the appropriate
script it would be much appreciated.
Q78 Mr Mitchell: I am not sure where
I am on my script. You must have realised right at the start that
it was going to be big. At what stage did it reach the highest
level in the Environment Agency so you could give a clear decision?
"Here is a big issue, we are going to have to face it",
at what stage did those bells begin to ring?
Sir John Harman: I would say at
my level in early September, early to mid-September.
Q79 Mr Mitchell: A bit late, was
it not, because all the permissions had been given then?
Sir John Harman: No, all the permissions
had not been given then. At that stage the trans-frontier shipment
permission had been given, the waste licence modification was
in the process of being concluded. You are right, with hindsight
it would have been great to say, "We spotted this one coming
over the horizon", almost literally—I perhaps regret
the use of that metaphor—and raised it earlier but it did
not appear to the teams dealing with it that it had those elements
to it at the time. It is easy to say with hindsight but it is
true.
2 Note by Witness: By the end of 2005, all
single hull tankers without additional protection (e.g. double
bottoms or double sides) will have to have been phased out. [The
IMO requirement is that all such tankers will have to have been
phased out by end-2007]. By end 2015, all EU flag single hull
"semi-protected" tankers (ie single-hulled but with
double bottoms or double sides) will have had to have been phased
out. Use of such tankers beyond 2010 is only permissible if the
ships pass a rigorous Condition Assessment Scheme (CAS) [The IMO
requirement is that all such tankers will have had to have been
phased out by 2017]. This means up to 2000 single hull tankers
flying the flags of EU Member States and Accession States will
need to have been phased out by 2015 at the latest. Back
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