Government Response
The new shipping strategy
Recommendation 1. We welcome the publication
of the Government's Shipping Strategic Partnership,
which could provide a sensible framework for Government policy
on maritime issues into the next Parliament. We recommend that:
- The framework and actions which flow from it
be subject to meaningful discussions with both the industry and
trade unions;
- The framework be sufficiently flexible to accommodate
changes in policy and circumstance, including ministerial changes;
- Policy should flow from the framework, rather
than the framework being used to legitimate a series of disconnected
policy announcements; and
- Ministers address the clear call from business
and unions for a more joined-up approach to maritime policy-making.
(Paragraph 9).
We welcome the Committee's support for the Shipping
and Ports Strategic Partnerships. The Government strongly believes
that the partnership between Government and industry exemplified
in this jointly published document must continue to lie at the
heart of further policy development and implementation. The Government
is therefore continuing to work with industry and the trade unions
to identify the key priorities for action to deliver the greatest
early benefit to the UK maritime sector and to maximise the contribution
shipping can make to our economy. In line with the published strategy
we would expect continuing work to comprise a range of actions
by both Government and industry. A number of such actions have
already been discussed and agreed with industry and the trade
unions in round-table discussions including representatives from
all key maritime sectors and ministers from across government.
These include optimising the use of the additional funding for
maritime training announced by the Government in September last
year, and piloting the inclusion of ratings training within the
Support for Maritime Training Scheme. It is the Government's clear
intent that the Strategic Partnership document should provide
a flexible framework allowing policies and actions to develop
to reflect changing circumstances and that the steps that have
already been taken, and acknowledged by both industry and the
trade unions to deliver the more joined-up approach to maritime
policy making, including regular Ministerial round tables chaired
by the Shipping Minister and including Ministers from across a
range of Government departments, should continue.
London International Shipping Week
Recommendation 2. We welcome plans to hold a second
London International Shipping Week in 2015 and recommend that
the Government ensures that it showcases maritime industries across
the UK. (Paragraph 11)
We agree that the UK as a whole has a strong message
to tell about its maritime sector. The London International Shipping
Week (LISW) was of course a partnership between the conference
organisers, industry (led by Maritime London and Maritime UK)
and Government and we are pleased its success has enabled commitment
to a similar event in 2015. London is at the heart of the UK maritime
sector but maritime is also recognised as a sector which spans
the UK. As we prepare for LISW 2015 we will build on the successes
of the inaugural 2013 event and develop the 2015 event to reflect
the diversity of the sector and geographical spread across the
UK.
The UK-flagged fleet
Recommendation 3. The growth in the size of the
UK-owned and UK-flagged fleets in the decade from 1999 was a significant
achievement which had a substantial, positive economic impact.
We welcome the Government's commitment to continue to "promote
the UK flag as the register of choice for high quality ships"
but it is not clear what steps are being taken to achieve this.
The recent recession halted the growth of the fleet. We recommend
that the Government set out what policy measures it will use to
ensure that the UK-flagged fleet begins again to grow in size.
(Paragraph 15)
Recommendation 4. We recommend that Government
explain how it will "promote the UK as a global shipping
base and centre for maritime services" available to vessels
of all nationalities. (Paragraph 16)
The Government agrees that recent trends, including
the increasing challenge from other maritime centres, particularly
those in the Far East means that it is necessary to look, in partnership
with the shipping industry and the broader maritime sector, at
a range of actions that might help to maintain or improve the
attractiveness of the UK as a flag of choice and the place in
international shipping companies would wish to bring their business.
The Government will set out its plans to take this forward in
conjunction with industry in the near future.
Red Ensign Group
Recommendation 5. Given that the UK Government
has a stated aim of expanding the UK-flagged fleet as "register
of choice for high quality ships", it is surprising to find
that it also oversees a number of competing shipping registers.
Furthermore, the primary attraction of some of these registers
to shipowners is that they offer a lower standard of employment
rights than does the UK flag. The Government has acknowledged
that growth in some of the registers is linked to the tax haven
status of the territories concerned. The Red Ensign Group does
not feature in Shipping Strategic Framework and we question whether
it contributes to the UK's shipping strategy. It is not clear
that the benefits to the UK from overseeing the Red Ensign Group
outweigh the costs of doing so. We recommend that the Government
review the support it provides to the Red Ensign Group, with a
view to raising the standards of the vessels which fly under the
flag. (Paragraph 20)
The Government believes that it both has a responsibility
in line with the UK Government's commitment in the white paper
The Overseas Territories: security, success and sustainability
(published 2012), together with the Government's response to Justice
Select Committee Report 2010, to support legitimate economic activities
in its Overseas Territories (OTs) and Crown Dependencies (CDs)
and that the Red Ensign Group (REG) registers both can and do
bring advantages to the UK. The growth of the British Shipping
Registers operated by the UK, OTs and CDs in recent years has
led to the combined UK and REG fleet forming the 7th largest flag
in the world. This places the UK in a strong position as a large
Red Ensign Group is likely to bring more business for the UK's
maritime business sector and also increase the UK's level of influence
on the development of international maritime regulatory framework
within the International Maritime Organization (IMO), the International
Labour Organisation (ILO) and the EC, all of which is pivotal
to the UK's shipping strategy.
It should be recognised that under international
law, the United Kingdom of Great Britain and Northern Ireland,
together with the OTs and CDs form just one Flag State. In
terms of international maritime law, that one Flag State - the
UK - is the only Flag State for all ships registered in the UK
or in any of the OTs and CDs. For any breach of international
law, the UK Government will be answerable internationally.
The Government will therefore continue to retain
an effective level of oversight and scrutiny of the REG, with
control measures where required. We will work collaboratively
with colleagues within the OTs and CDs to ensure that fleet growth
across the REG continues and that all ships flying the Red Ensign
are maintained and operated in accordance with relevant international
conventions and UK policy.
The effective monitoring of the REG members has identified
occasions where the required standards have not been fully complied
with and has allowed early corrective actions to be undertaken.
However, the positive response to those control measures by OT
governments affected indicates the success of this strategy and
the willingness to comply. This oversight ensures that the Red
Ensign continues to be recognised internationally as a high quality
flag.
Although a uniform approach to maritime policy is
sought throughout the REG, it must be recognised that in some
instances this is not possible. Predominantly the CDs and OTs
follow the same international conventions and treaties as the
UK. However certain additional obligations may be required to
comply with specific EU and EC treaties and directives which are
restricted to the UK and EU based REG members. Due to the global
nature of the shipping industry, companies have a wide choice
of where they register their vessels and take their business;
they may choose for competitive reasons to operate their vessels
under the framework of international rules and regulations, rather
than under more restrictive national or regional regulatory frameworks.
While the UK would prefer that the European regulatory framework
does not put member states at a competitive disadvantage in attracting
international business, where it does occur, the Government believes
that it remains to the advantage of the UK as well as shippers,
passengers and employees that the businesses can flag their ships
to a quality REG flag rather than potentially poorer quality ones
that are not under the oversight of a high quality maritime administration
such as the Maritime and Coastguard Agency (MCA). In providing
the oversight of the REG, the MCA continues to ensure that the
REG continues to meet all aspects of the international regulatory
framework for shipping including the higher standards of protection
set for seafarers under the Maritime Labour Convention.
Recommendation 6. We also call on the Government
to review whether the MCA could provide registry support to other
flags, as another way of ensuring that the UK provides a global
lead in high-quality shipping standards. (Paragraph 21)
The MCA has an excellent reputation in the maritime
world and has, over many years, shared its knowledge and expertise
with both individuals and other countries to help them develop
or enhance their standards.
Training and skills
Recommendation 7. We recommend that the Government
make an explicit commitment to address fully the predicted shortfall
in trained seafarers by 2021. (Paragraph 29)
The Government has made clear its commitment to ensuring
that the UK has the maritime skills base it will need to sustain
our position as the world's leading maritime centre and to sustain
our maritime and offshore activities by increasing the amount
of funding available in support of maritime training by 25% until
the end of the current spending review period as well as piloting
of the training of ratings as part of tonnage tax core training
commitment.
The Department will continue to undertake analysis
of the needs of the maritime industry, in relation to the projected
number of seafarers, with a view to informing future policy. Future
policy also needs to take into account such factors as availability
of berths on vessels and capacity at relevant nautical colleges.
We are working with industry colleagues, including the unions
to ensure good promotion of maritime training and career opportunities.
We will keep the Committee informed of our progress.
Recommendation 8. We have sympathy with the argument
that the tonnage tax regime should support the training of ratings
as well as officers. We look forward to Maritime UK and the trade
unions working together to demonstrate that ratings trained in
this way would find long-term jobs in the shipping sector. Once
this evidence is provided, we recommend that the Government introduce
a pilot scheme to demonstrate whether this form of training would
be viable. (Paragraph 25)
At the March 2014 Ministerial maritime round table
with industry, the Government agreed to pilot a change to the
tonnage tax regime that will allow the training of 3 ratings in
place of 1 cadet as part of the tonnage tax core training commitment.
In order for this pilot to succeed in the long term, the unions
and Maritime UK need to be able to demonstrate that there are
long term job opportunities in the sector for the ratings once
trained.
Recommendation 9. We welcome the Government's
decision, announced during London International Shipping Week,
to restore SMarT funding to the level it inherited when it came
into office. The current Government cannot determine the funding
of the scheme beyond 2016 but it can help build consensus about
the wider economic value to the UK of supporting the training
of seafarers. One way of doing this would be to commission an
updated analysis of the value of the scheme, which could contribute
to the post election spending review: we recommend that DfT do
so. (Paragraph 27)
In considering our contributions to the post election
spending review, we will commission updated analysis of the SMarT
funding programme in order to establish what value this scheme
delivers to the UK economy
Recommendation 10. We find it unacceptable that
the Skills Funding Agency's inflexible approach imposed a two-year
delay on the introduction of these apprenticeships, which are
crucial to maintaining and developing the UK's maritime work force.
We recommend that the Government work with the shipping industry
to promote takeup of apprenticeships in order to build the industry's
confidence that apprenticeships are now here to stay. (Paragraph
28)
The Government has shown its commitment to apprenticeships
and is on track to deliver two million apprenticeship starts in
this Parliament. Government's planned investment in apprenticeships
in the 2013-14 financial year totals £1.566 billion.
But apprenticeships are demand-led - they can only
be delivered where employers come forward with vacancies. We
hope that the current reform of apprenticeships will make them
more relevant and attractive to employers.
As part of BIS's review of apprenticeships, a maritime
trailblazer for ratings was announced in March 2014. This highlighted
the new standard focussing more on meeting industry needs. In
addition to this, at the recent maritime training and employment
Ministerial round table, it was agreed to do more to raise the
awareness of what is available in terms of maritime training.
The maritime sector is actively taking advantage of the apprenticeship
reforms and the new flexibilities they allow to develop a
new maritime apprenticeship standard for Deck, Engine Room
and Catering Ratings as part of the apprenticeship trailblazer
programme. A number of employers will lead the development
of the standard including DFDS, Princess Cruises, Carnival UK,
P&O Ferries, Royal Navy and James Fisher (Shipping Services)
Ltd.
Recommendation 11. We recommend that the Government
work with Maritime UK and the Maritime Skills Alliance to develop
statistics showing what proportion of the people recruited as
officer cadets stay in the maritime sector. Only by doing so can
the Government ensure that its financial commitment to training
seafarers represents long-term value for money. (Paragraph 30)
The MCA conducted a survey in 2009 to investigate
the employment rates of seafarers whose training had been largely
sponsored by the UK Government in order to draw conclusions regarding
its effectiveness and value for money. These results showed that
96% of those officers who responded had found employment at sea.
The Department is shortly to meet Maritime UK and
the Maritime Skills Alliance to discuss what data is available
on seafarer destination statistics and develop a picture on long
term commitment in employment at sea.
MCA and MAIB resources
Recommendation 12. The Maritime and Coastguard
Agency is taking on significant new responsibilities at the same
time as its budget is being squeezed and while it is carrying
a sizeable number of vacancies in key posts. There is as yet no
evidence that these factors are undermining the UK's ability to
enforce compliance with international shipping regulations. Some
of the concerns about the MCA's performance may be assuaged by
increased transparency about its inspection work. However, there
is a risk that the MCA will increasingly struggle to discharge
its regulatory responsibilities, undermining the UK's status as
an influential member of the International Maritime Organization
and high-quality flag nation. We recommend that the Government
institute an independent review of how the Maritime and Coastguard
Agency will successfully take on new responsibilities without
a proportionate increase in its resources and publish the results
of the review in time to inform the next spending review. (Paragraph
36)
In making this recommendation, the Government believes
that the Committee was particularly concerned with the MCA's resources
to apply and enforce new maritime labour, and sulphur emission
standards. As set out in the Department's evidence to the Committee,
preparation for these new responsibilities has been a one-off
exercise, and the necessary inspection and certification activities
will form part of normal business for the MCA. Responsibility
for implementing and enforcing the regulatory standard will be
absorbed by existing survey and inspection personnel as part of
routine inspection work, as is the case with all other regulatory
changes affecting ship and maritime labour standards. More generally,
the Government routinely reviews its resource levels to prioritise
and balance the delivery of its statutory and non-statutory responsibilities
as part of its corporate planning processes. This will also be
done in advance of the next Spending Review.
While the Committee noted that staffing levels do
not currently undermine enforcement of existing measures, we recognise
that longer-term resourcing does need to be addressed. The Government
is pleased to report that a review of the MCA's survey and inspection
capability is already underway which will address surveyor recruitment
and retention, institute modern, industry-standard working practices,
and provide staff with more efficient ways of working. By adopting
best practice in the assurance of maritime safety through the
application of risk assessment and measurement, the Government
will in future target surveyor attention more closely on the areas
which achieve the greatest impact on maritime safety. When these
changes are taken together they will ensure that the MCA is able
to deploy the resources that are available to it, in ways that
achieve the fullest effect.
In view of work that is ongoing and planned to review
survey and inspection capability and delivery, the Government
believes that an independent review of MCA's resources at this
time would be an unnecessary step.
Recommendation 13. We value the work of the MAIB,
which we have often found to be extremely useful. We are concerned
when senior maritime professionals suggest that budget cuts are
undermining the work of the organisation. We look to the MAIB's
chief inspector to inform us if budgetary constraints prevent
him from adequately discharging his duties. (Paragraph 39)
The MAIB is not immune from the budgetary pressures.
It will continue to deliver high quality reports including more
"short" reports to meet EU requirements within the resources
available.
Wind farm passenger transfer vessels
Recommendation 14. There is widespread support
for an urgent update of the Code of Practice for Small Commercial
Workboats, in the wake of the MAIB's report on the Windcat9 and
Island Panther accidents. We recommend that the Government ensure
that this revised Code of Practice is promulgated before the summer
or explain to us why this is not practicable. (Paragraph 40)
Recommendation 15. The MAIB has identified a risk
that the crew of passenger transfer vessels may not always be
sufficiently qualified for the work they undertake. This is a
significant safety risk to the staff servicing offshore wind farms.
We recommend that the Government work with the relevant industry
groups to increase the minimum qualifications for the crew of
wind farm passenger transfer vessels so that they better reflect
the seamanship required for this work. The aim should be to introduce
new minimum qualifications by 2016, with voluntary compliance
with higher standards before then. (Paragraph 41)
The Government understands the need for the publication
of the Brown Code Edition 2 in the summer and is working to present
a final draft to industry prior to the Seawork Exhibition in June
2014. The final draft had wide consultation and will reflect extensive
input and contributions made by the industry through the MCA's
Small Workboat and Pilot Boat Code Technical Working Group.
The new edition of the Brown Code reflects the requirements
of wind farm operations. It should be noted that the MAIB Report
into the Windcat 9 & Island Panther incidents made recommendations
to industry rather than to the Government.
Wind farm passenger transfer operations are similar
to the passenger transfer operations routinely carried out by
many other workboats around the coast, or by pilot vessels. Indeed,
there are other ship-to-ship transfers, usually carried out with
both vessels making way, that are arguably more demanding than
those experienced with windfarms. The MCA's Marine Guidance note
MGN 432 sets out safe procedures for ship to ship passenger transfers.
The existing requirement for workboat crew training
and qualifications proportionately addresses the risks associated
with operating these types of vessels. By working on smaller vessels,
seafarers gain knowledge and skills. This increases employment
opportunities for those with good practical experience of boat
handling and coastal operations, but who do not possess full Standards
of Training, Certification and Watchkeeping (STCW) qualifications.
The alternative would increase the demand for STCW qualified seafarers
from the deep sea sectors.
There is a need to upgrade the skills of workboat
masters, and the Government is already closely involved in the
approval of additional training programmes. For example, the 200
GT STCW Master Code Vessel Certificate of Competency is available
to Workboat Masters and is currently achieved after further examination
by the MCA. The MCA will consider the suitability of this certificate
for use in the windfarm industry.
It would be counter-productive to introduce wholesale
prescriptive changes without proper consultation and full consideration
of the likely consequences.
The correct approach - as recommended by the MAIB
- is to improve the awareness and training of masters and crew
to address safety risks experienced by, and within the industry.
Industry codes of practice are being set up for this relatively
young industry to apply to those types of operations, and to the
training and qualifications of their vessel crews and to other
employees.
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