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First Standing Committee
on Delegated Legislation
Monday 9 June 2003
[Mr. James Cran in the Chair]
Draft Race Relations Act 1976
(Seamen Recruited Overseas)
The Parliamentary Under-Secretary of State for Transport (Mr. David Jamieson): I beg to move,
That the Committee has considered the draft Race Relations Act 1976 (Seamen Recruited Abroad) Order 2003.
It is a pleasure to serve in Committee under your chairmanship, Mr. Cran. The order, which amends section 9 of the Race Relations Act 1976, forms part of the Government's wider amendments to the Act, implementing the race directive adopted under article 13 of the European Community treaty. I am pleased to say that our proposals go beyond the requirements of the directive.
Our amendment will prohibit discrimination on the basis of colour and national origins, as well as on the basis of racial and ethnic origin as required by the directive. Its effect is that nationality will be the only grounds on which to justify treating people differently. That will apply to seafarers recruited abroad to work on ships registered in Great Britain, when in United Kingdom waters, but only in terms of pay, including retirement and death benefits. Parallel legislation will be laid for ships registered in Northern Ireland.
We are amending the Act against the background of a substantial revival in the United Kingdom merchant fleet, with an increase of about 90 per cent. in United Kingdom registered shipping since 1997. We have created a highly favourable environment for shipping, with the introduction of the tonnage tax and the reforms in ship registration introduced by the Maritime and Coastguard Agency. That has been achieved without compromising the high standards of a quality flag.
As a major maritime nation, the United Kingdom has continued to play an important role in the International Maritime Organisation. In particular, we have given, and will continue to give, our full support to the international quality shipping campaign, which is designed to rid the sea of substandard ships. We can proudly boast of a sound maritime administration, which maintains a high-quality flag that is second to none. The United Kingdom, I am proud to say, is currently top of the Paris memorandum of understanding white list and does not feature as a targeted flag in any of the other port state control regions.
The conditions of employment on United Kingdom registered ships are high—certainly higher than on the so-called flags of convenience. All United Kingdom registered ships are required to have crew agreements approved by the Maritime and Coastguard Agency, whose surveyors assess, for example, safety, accommodation and pollution prevention. All
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seafarers employed on United Kingdom registered ships benefit from higher standards of care and safety, as a result of the importance that we place on safeguarding the livelihood and welfare of those aboard, the environment and cargoes.
The United Kingdom is one of only a small number of International Labour Organisation member states that have ratified the ILO convention 180 on limiting seafarers' working hours by providing minimum hours of rest. We shall thus be able to enforce our working time standards, which are the same as those in the convention, against any vessel, whatever the flag, calling at a United Kingdom port. That will be an important benefit to all seafarers serving on non-EU registered vessels. Our inspections under port state control are also an important factor in ensuring safety and the well-being of crews on board ships coming into our waters. Seafarers are thus benefiting from improved working conditions. The measures demonstrate clearly the United Kingdom's commitment to protecting seafarers' interests.
The revival in United Kingdom shipping follows a long decline since the late 1970s. The decline has occurred for most of the period in which the Act has been in force. Consequently, fewer ships were subject to United Kingdom legislation. However, that has highlighted the fact that foreign seafarers do not enjoy the protection under the Act that is enjoyed by United Kingdom seafarers. The EU article 13 race directive requires implementation of the principle of equal treatment between persons, irrespective of racial or ethnic origin. We strongly support that principle and, in many respects, it accords with the race relations legislation that this country has had for many years.
As I have said, the order to amend section 9 of the Act also outlaws discrimination on the basis of colour and national origin as well as racial and ethnic origin, as required by the directive. However, we propose to retain the ability to pay seafarers differently on the basis of nationality.
I recognise the concerns that have been expressed. However, the Government are persuaded that regulating to prevent pay differentiation on UK-registered ships in respect of seafarers recruited abroad would be ineffective; indeed, it would be counter-productive. After very long and careful consideration, we concluded that the total abolition of section 9 would seriously jeopardise the success that we have achieved in reviving UK merchant shipping. It was not a course that we were prepared to follow.
Crewing costs are a substantial proportion of overall shipping costs, and shipping companies operate in a highly competitive sector. We estimate that the additional costs to shipowners that would be incurred as a result of the total repeal of section 9—it could be as much as £40 million—would drive many shipping companies to register their ships abroad.
All other EU member states are retaining the ability to pay foreign seafarers at differential rates; not proceeding with our proposals could put UK-registered vessels at a significant commercial disadvantage in a highly competitive market. We estimate that as many as 400 ships, and possibly
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more, could leave the UK register, thus removing them from the jurisdiction of the UK, with the risk that they could move to less safety-conscious registers. That estimate is supported by the Maritime and Coastguard Agency, which has already received approaches from shipping companies asking which other flag state they would recommend if a total repeal of section 9 were to go ahead.
We do not need to speculate on the matter. In the 1980s and since, policies were introduced that led to a huge decline in UK ship registration and the seafarer employment that went with it. For example, changes in capital allowances and deferred tax liabilities were unfavourable to shipping. The Government are not prepared to make the same mistake and risk the substantial achievements that we have secured in recent years. The Government are firmly committed to removing discrimination wherever possible. We are also firmly committed to the continued success of the United Kingdom register and of our shipping policy in general.
Mr. Christopher Chope (Christchurch): Can the Minister clarify the applicability of the national minimum wage? Is it correct that foreign seafarers qualify for it on UK-flagged ships when in UK waters? How does that compare with the position elsewhere in Europe?
Mr. Jamieson: The answer is yes. If other countries have legislation for a national minimum wage, it would apply within the waters of those countries.
Our proposals will result in seafarers enjoying the advantages of employment on ships registered under the high-quality UK flag. The Government firmly believe that it is the right decision, both on moral and economic grounds, and our measures go further than required by the directive. I commend the measures to the House.
Mr. Chope: It is a pleasure, Mr. Cran, to serve under your chairmanship. The Minister was a little coy about the background to the order. The Chamber of Shipping strongly objected to it as it was originally proposed, and I am pleased to say that as a result of its representations, the Government shifted their ground significantly. I am sure that it is much better as a result.
It is sad that we have to debate implementing a European directive instead of deciding such matters in the context of our national law. As the Minister knows, we were the first country to introduce race relations legislation, but we are now being told by Europe that we must legislate to a different standard. He said that he was prepared to gold-plate that European legislation to make it extend to colour and nationality, but he has not explained why he thinks that that is a good thing or why there should be a European standard rather than individual national arrangements, which have worked very well.
We shall not oppose the order, because it is much less offensive than it would have been had it not been for the Government's change of view. However, we remain concerned that we are being second-guessed by
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an increasingly interfering European bureaucracy on issues that we as a Parliament should be deciding freely for ourselves, such as what is in the best interests of the British people and the British shipping industry. This is another example of such an issue and Committee members will find it especially offensive. We as a Parliament have hitherto known best about how to deal with race relations in this country and we have operated successfully. Nevertheless, here we have interference by the EU that we could have done without.
John McDonnell (Hayes and Harlington): Thank you for allowing me to speak, Mr. Cran. I am not a member of the Committee, but I should like to express some views about the nature of the order that I also raised during an Adjournment debate on the day when it was proposed in draft form.
The proposed legislation is still offensive; it offends against the basic principle of equality, for which many of the democratic parties in this country have stood for more than a century. It will enable employers to pay two different rates to two workers doing the same job on the same ship and enduring the same conditions. To say that the discrimination will continue on grounds not of race, but of nationality, is purely cosmetic. Employers will be able to continue to pay Filipino or Bangladeshi workers a quarter or half the wages they pay to British seafarers. It is that which offends and not the idea that the order is a response to a European directive. I welcome the fact that the Government have gone further than the directive asked us to go. We must, however, go one step further.
The history is that when previous Labour Governments introduced race relations legislation—they did so with the support of the Liberal Democrats, to give them their due—the shipping industry was exempted on three grounds. First, it was allowed to discriminate to prevent black and white people from sharing cabins. Secondly, it was allowed to prevent black and white people from sharing the bays in which they lived. Thirdly, there was the ability to discriminate in terms of pay.
Successive Governments, almost on an all-party basis, have eliminated the first two offensive discriminatory measures. This is the last hurdle, and I thought that the Government were going to rise to the challenge. When the Home Office started its consultation, the general view was that we were making a stand for equality and that we would go the full way. Since then, as the hon. Member for Christchurch (Mr. Chope) remarked, lobbying from the Chamber of Shipping has led to the Government's original intention being amended. The Chamber of Shipping lobbied and made all kinds of arguments about job losses and the impact on the industry. In fact, over the same period, we as a Government have given the Chamber of Shipping tax exemptions of £50 million—something that has never been seen before.
As the Minister said on introducing the proposed legislation, previous Governments hit the shipping industry hard, but the present Government have a
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fantastic record of assisting it. Even though the industry took some £50 million, and it may have increased the flag of British ships, it still imported labour from the Philippines and elsewhere to work on British-flagged ships and paid those people less, thus undermining the growth in British seafaring jobs.
This is not just about protecting British seafaring jobs, but about ensuring that British workers working with those from other countries protect them by ensuring that they are paid at the same rate. The shipping industry has used the same argument that it used against us as a Government when we introduced equal pay and the minimum wage, and against any other advance going back almost until we took the children out of the pits. It is the same argument that the Liverpool slave and shipowners used against the abolition of slavery—that the industry will be smashed, other competitors will take the work and we will not be able to sustain British jobs. Now is the time to take a bold step for equality, scrap all discrimination on British ships and prevent British ship companies from going to the Philippines, recruiting seafarers, bringing them to British waters and paying them so little. I have the Lapthorn contract in front of me: for 48 hours' work a week a Filipino can earn less than $500 a month. That is the level of exploitation that we should be trying to eliminate.
I urge the Committee not to accept the proposal, but to think again. There must be a better way for a Labour Government to address continuing discrimination against some of the most exploited workers in the world.