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Some have argued that light dues are a trifling amount compared to other shipping costs; but they are not trifling in absolute terms. After April next year, the cost will be 41 pence per net registered tonne. The capping of the chargeable tonnage will be increased to 50,000 tonnes, and the number of chargeable voyages increased from seven to nine. Fortunately, the charges will be capped at £17,200. Unless my sums are wrong, this means that a 10,000-tonne ship regularly coming to UK ports will pay just under £37,000 a year, which is not insignificant. The noble Lord, Lord Berkeley, warned of the dangers of reducing port business due to increases in light dues.
My noble friend Lord Glentoran and others skilfully sought to explain why no more major efficiencies are possible in the GLAs. He has suggested that it would cost between £25 million and £70 million to set up a single GLA. I do not find my noble friend's arguments persuasive, and he has increased my desire for knowledge of the organisation of the GLAs. I am sure that Trinity House will be very keen to help in educating me.
Noble Lords who claim that no further efficiency savings are possible will have to explain why we need two corporate centres. Why in the UK do we need two chief executives, two finance directors, two HR departments and two procurement departments? The list goes on. Perhaps the Minister can explain why we need two GLAs in the United Kingdom.
I have another question for the Minister which I hope he can answer. What is the total head count of Trinity House and what is the split between the corporate headquarters and the operational side? I can find very little information about that on the Trinity House website.
The primary concern of the noble Lord, Lord Berkeley, and the substantive point of his Motion, is the subsidy of the Irish Lights. I will not repeat his arguments, because he put them so well. However, I suspect that there is a lot of history involved. For a long time, it may have been desirable to subsidise the Irish Lights, but nowadays most of the UK's general public would be surprised to hear that we, through our light dues, are subsidising the transport infrastructure of another successful and important EU state. After all, we do not subsidise the French navigational aids in the same way, even though we make extensive use of them-a point well made by the noble Lord, Lord Dykes.
The noble Lord, Lord Greenway, made several important points, but perhaps one of the most important was about the dangers of relying on the US-operated GPS system and the slow progress of Galileo. We must keep the terrestrial aids supplied by the GLAs. The noble Lord said that they are worth their weight in gold; he is right. The noble Lord, Lord Robertson, amplified those points, and he also mentioned the dangers of a cyber-attack on a GPS-type system. He is absolutely right.
My noble friend Lord Sterling made his important contribution from the interesting position of having an interest in both the shipping industry and Trinity House. His most important assertion is that the operations of the GLAs are already very efficient. However, the concern is not the front-line operations, but the corporate centre. My noble friend also suggested that private yachts should pay dues. He will recognise that there are some practical difficulties in collecting what might be relatively small amounts of money. On the other hand, private yachts are just as dependent on navigational aids as commercial shipping.
It is important to understand the effect of the Motion of the noble Lord, Lord Berkeley. It does not stop the order, not least because, quite properly, the order is going through under the negative procedure, and of course the Motion does not oppose the order's contents. There is no question of the GLAs running out of money, so the noble Lords, Lord Greenway and Lord Robertson, need have no worries on that point. The light dues will increase no matter what your Lordships decide this afternoon.
There is concern about the efficiency of the GLAs but the Motion does not make a judgment on that. If it did, I would not be able to support it due to insufficient evidence. The noble Lord is asking your Lordships to take a view on whether the light dues raised in the UK should be used to subsidise the operation of the Irish Lights. If he is minded to test the opinion of the House, I shall support him.
Lord Faulkner of Worcester: My Lords, this has been a remarkable and interesting debate and I am grateful to my noble friend Lord Berkeley for initiating it. I suspect that he was not aware that he would draw into your Lordships' Chamber such an extraordinary galaxy of talent as is arrayed on all Benches this afternoon-a collection of Elder Brothers, Younger Brothers, ship owners and people with astonishing experience in this field, many of whom, I am delighted to say, have been supporting the Government's position and, I am afraid, opposing my noble friend's Motion.
I start by thanking those of your Lordships who were kind enough to welcome me to the Dispatch Box for my first substantive debate. I thank the noble Baroness, Lady Wilcox, the noble and learned Lord, Lord Mackay of Clashfern, and the noble Lord, Lord Higgins, in particular.
It seems that three strands have run through the debate. The first is the efficiency of the general lighthouse authorities, or GLAs. I shall try to avoid unnecessary and confusing use of initials and the incomprehensible jargon to which the noble Lord, Lord Higgins, objected.
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I start with the General Lighthouse Fund. This was created by statute in 1898 to pay for the work of the GLAs in the United Kingdom and Ireland. The fund is maintained by a combination of light dues paid by ships that use ports in the UK and Ireland, the income from investments, a contribution from the Irish taxpayer and other funds generated by the use of the GLAs' assets.
I understand the concerns that exist about the costs of the lighthouse service but I cannot accept some of the more exaggerated claims that have been made about them. The GLAs have made substantial efficiencies over recent years, all without compromising the safety and navigational service that they provide. For example, Trinity House has closed half its depots and cut a third of its staff and a quarter of its fleet; the Northern Lighthouse Board has cut its waterfront bases from three to one, reduced its vessel crews and disposed of properties; and the Commissioners of Irish Lights have reduced staffing levels at sea and on land by around 30 per cent. Indeed, taken as a whole, the GLAs reduced their total headcount by more than 50 per cent between 1991 and 2007 without in any way compromising the safety of seafarers or the quality of the navigational service that they provide.
The noble Earl, Lord Attlee, asked about manning numbers. The numbers employed are as follows: Trinity House, 321; the Northern Lighthouse Board, 261; and the Commissioners of Irish Lights, 272. I do not have a precise figure for the number employed at the corporate centre but it is less than 20 per cent. The noble Earl also raised a question about the merging of the three GLAs. That would be a very difficult undertaking. It might be possible to encourage what one could call the back-office functions to work more closely together to save costs. Certainly the Department for Transport will do what it can to persuade them to make savings where it is practical to do so. With regard to the front-end services, the GLAs operate in differing and complex coastlines where regional knowledge and experience are required. It is unlikely that further savings in terms of depots and so on can be rationalised but, where possible, the Department for Transport will press for further action.
There is no evidence whatever of "bloated" administrations-a phrase that has been used more than once by a lobbyist on the other side of the argument, the chairman of the Independent Light Dues Forum, who, I believe, would support my noble friend's Motion this afternoon. He had a letter published in Lloyd's List last month, to which a former editor of Lloyd's List, Michael Grey, replied:
"Mark Bookham of the Independent Light Dues Forum now writes ... about the 'bloated' General Lighthouse Authorities, while ignoring the efforts made by these same authorities over several years to reduce their operating costs. He conveniently ignores the fact that they are an emergency service and must be staffed appropriately".
The GLAs have taken advantage of the efficiencies that new technologies can provide, such as the use of LEDs-I apologise; I should say "light emitting diodes"-and solar panels, which have been able to reduce the number of lighthouses and light vessels that they employ. They also use more efficient ships for buoy and maintenance work. Overall, their operating costs have been reduced by 25 per cent over the past 10 years and, until this year, it had not been necessary to increase light dues at all since 1993, a point well made by the noble Lord, Lord Glentoran. Indeed, the Government were able to pass on those savings to the shipping industry in 2006-07 by reducing light dues from 39p to 35p per tonne. In a Written Statement in the other place on 10 March 2006, the Minister of State in the Department for Transport, Dr Stephen Ladyman, was able to say:
"The Government remains committed to a cost recovery system, but is determined to minimise the cost burden on the shipping industry. The rate per tonne has fallen repeatedly since its 1993 peak of 43p. Reducing it now to 35p constitutes a further 10.2 per cent. fall. This is a remarkable achievement during a period of major capital investment by the General Lighthouse Authorities and against a background of general inflation. It is a credit to the commitment of the General Lighthouse Authorities-Trinity House Lighthouse Service, the Northern Lighthouse Board and the Commissioners of Irish Lights-to the delivery of an efficient and cost effective aids to navigation service. The strong performance of the underlying General Lighthouse Fund in the past year also makes a cut on this scale possible. The cut returns to the light dues payer the benefit of the growth in the Fund, for as long as this proves possible".-[Official Report, Commons, 10/3/06; col. 86WS.]
However, it was made absolutely clear in 2006 that the new rate could not be sustained in the longer term and the Government obtained the assurance of the Lights Advisory Committee, which represents the shipping industry, ports and cargo interests, that it was prepared to support a rise in light dues should that become necessary at some future date. That, too, was mentioned in Dr Ladyman's Written Statement of 10 March 2006.
As foreseen, an increase in light dues is now essential. What was not foreseen three years ago was today's global recession, one of the effects of which has been a reduction in trade so severe that shipping companies are laying up vessels, rationalising routes and concentrating on larger ships. That has led to a fall in found income but, as a number of your Lordships have said today, particularly the noble Lord, Lord Greenway, we cannot afford to let the GLAs take chances with their safety functions. We have asked them to make cuts, to put off non-essential expenditure and to search for further efficiencies. They have reduced costs by 5.6 per cent this year, but there is not such a close correlation between trade and spending in their case. Lighthouses must be lit, radio navigation signals broadcast, channels surveyed and buoys moved. We must maintain those safety-critical functions. Expenditure deferred now may well result in greater costs in a year or two.
The noble Lord, Lord Glentoran, referred to the pension fund. In a debate in the other place on 2 June, Mr Jim Fitzpatrick, the Parliamentary Under-Secretary of State in the Department for Transport, made the point that the fund's income contains £44 million of pension contributions from GLA employees that is sacrosanct.
I hope that your Lordships will understand that the Government have had a difficult balancing act to perform. We received 47 responses to the consultation and my honourable friend Jim Fitzpatrick held four meetings with the representatives of those most affected. We do not underestimate the concerns that have been expressed by representatives of the shipping industry. We recognise that these are difficult times for them and that any increase is unwelcome.
The noble Lord, Lord Higgins, asked for details of the deficit. At the time of the consultation, it was forecast to be £21 million. Since then, there have been slight improvements in investment returns, which have reduced the forecast deficit, but without the increase in light dues it is still likely to be around £15 million. The increases that took effect on 1 July should allow the General Lighthouse Fund to remain at around the minimum reserve level for the next year.
Since the consultation, we have therefore looked carefully at our original proposals, which provided for a rise in the rate of light dues from 35p to 41p per net registered tonne from July this year. We also proposed raising the tonnage cap from 35,000 to 50,000 net registered tonnes, so that some of the very biggest vessels would pay more, and increasing the number of chargeable voyages from seven to nine per year. In response to the representations received, we decided to phase the increases over a two-year period, so that the rate would go up from 35p to 39p per net registered tonne, with a further increase from 39p to 43p from 1 April 2010. Even at 43p, the light dues rate will be no higher than it was 16 years ago; indeed, in real terms it is 32 per cent lower. The tonnage cap has also been reduced and deferred, so that it will rise to 40,000 net registered tonnes from 1 April next year.
I am pleased that the noble Lord, Lord Greenway, refuted the argument that has been put forward by some that large modern ships do not need navigational aids. It is precisely for their benefit that deep water channels have to be surveyed and marked and obstructions monitored and dealt with.
Neither do we believe that we should depart from the "user pays" principle and in some way hand over to the taxpayer the costs of these essential safety services. That would be particularly wrong bearing in mind the fact that the majority of commercial shipping services calling at British ports are owned by companies based outside the UK.
However, I agree that a fundamental look at how we should provide a lighthouse service and the structural form it might take is needed. I can tell the House that the Department for Transport, with its Irish counterparts, is to conduct an overall assessment of lighthouse services as a whole with the aim of achieving further increases in efficiency and improvements in their structure and financing. Following today's debate, I shall ask departmental officials, the GLAs and the Lights Advisory
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I turn finally to the Irish question-the funding of the Commissioners of Irish Lights-the issue that has so vexed my noble friend Lord Berkeley, yea these many years. Unfortunately, I do not have time this afternoon to delve into the history, but it seems to be a piece of unfinished business left over from the partition of Ireland and the formation of the Irish Free State in 1922. I found a Hansard report of a Question asked in the other place on 16 March 1925 on when negotiations with the Irish Free State were likely to be concluded. Mr Ormsby-Gore, who I believe later became Lord Harlech, replied that a similar question was put in the Dáil but that he had no means of ascertaining when the negotiations would be concluded. As the noble and learned Lord, Lord Mackay, pointed out, the funding of Irish Lights can be seen, much more importantly, as part of the long-established British-Irish and north-south co-operation that has been of such benefit to all the communities in the island of Ireland these past years.
Of course it is not satisfactory that light dues collected in the United Kingdom are being used in part to pay for lights in the Irish Republic. In 1985, the Irish Government agreed to make an additional contribution towards the cost on the basis that 70 per cent of the costs of the Commissioners of Irish Lights were to be treated as incurred in the Irish Republic and 30 per cent in Northern Ireland. Of that 70 per cent, half would be funded from Irish sources and half from the General Lighthouse Fund-in other words, UK light dues payers.
The GLF has provided an average of £7.25 million a year for the CIL over the past seven years, starting with £5.5 million in 2002-03 and rising to an estimated £11 million in 2008-09. That is not the figure of £15 million which my noble friend Lord Berkeley quoted and which would include the costs of lights in Northern Ireland, for which the UK would have to retain responsibility. The net financial saving of ending co-operation with Ireland is probably around £7 million, but we would lose the very large, unquantifiable benefits of an integrated service if we cast Ireland adrift.
A review that was set up in 2007 and published in 2008 suggested that a more accurate split of the CIL's costs would be 85:15 rather than 70:30. This has been agreed by both Governments as the basis for the apportionment of funding for 2009-10. The two Governments also agreed to carry out an overall assessment of the provision of the integrated aids-to-navigation services to all regions in the UK and Ireland. All these matters were discussed in a meeting between Jim Fitzpatrick MP and the Irish Minister for Transport, Noel Dempsey, on 21 May. The Government are committed to renegotiating the current agreement to require the Republic of Ireland to meet the full costs of providing its aids to navigation. Simply walking away from the joint funding agreement and letting Ireland sink or swim on its own is not an option. We will have a responsibility to provide a lighthouse service to Northern Ireland.
Let us be clear: the three General Lighthouse Authorities provide an efficient, co-ordinated service for the whole of the British Isles. That is undisputed. Indeed, many eloquent speakers have referred to that in the debate this afternoon. We must protect the GLAs' vital safety function for the sake of people who sail in ships around our coasts and we must maintain them to ensure that the environmental risks from shipping are minimised.
This has been an interesting and instructive debate. I hope that I have done justice to the vital safety work of the GLAs and have replied to the points made by noble Lords. If I have missed any, I will write to them. I trust, too, that I have given assurances that the Government are not complacent in managing the General Lighthouse Fund and overseeing the lighthouse service and that they are serious about achieving long-term and lasting reform of the financing arrangements for all parts of the British Isles. In the light of this, I hope that my noble friend will agree to withdraw his Motion.
Lord Robertson of Port Ellen: My Lords, I hope that I will be allowed to correct an omission regarding a registrable interest that I did not declare. I am a non-executive director of Western Ferries (Clyde) Ltd, which operates ferries on the Clyde. Like the noble Lord, Lord Sterling, but at a much lower level, I am on both sides of the argument.
Lord Berkeley: My Lords, I am deeply honoured by the number of colleagues who have spoken in the debate. They represent an enormous range of experience and we have had a very wide-ranging debate, possibly more wide-ranging than I thought that it would be when I put down the Motion. It has been useful to expose the various issues surrounding light dues.
I do not think that anyone was suggesting that navigational safety should be compromised-I certainly did not-but I believe that there is still room for further cost savings. In that connection, we have four board members at Trinity House who are paid more than 70 grand, three commissioners of the Northern Lighthouse Board who are paid more than 70 grand and, of the Commissioners of Irish Lights, two board members are paid more than 70 grand while three earn more than 100 grand. Some savings could be made by amalgamation and, since Trinity House collects most of the light dues, perhaps it should take the lead. I think that lots of savings could be made.
I am grateful to my noble friend the Minister for his response and I congratulate him on undertaking his first duty on the Front Bench in a debate. It is good that the department and the Irish Government are looking at an overall assessment of lighthouses and safety aspects and it is very good that they intend to renegotiate what I call the Irish subsidy. The key point is that ships going into Irish ports will pay for Irish Lights because the user pays, while ships going into British ports will pay for the maintenance of British lights. I am sure that both the Government and the industry will strive hard to continue to make cost savings, but given the time and the excellent debate that we have had, I beg leave to withdraw the Motion.
Bill Main Page
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7th Report from the Delegated Powers Committee
8th Report from the Joint Committee on Human Rights
16th Report from the Joint Committee on Human Rights
Lord Lester of Herne Hill: In moving Amendment 178 I shall speak also to Amendment 179 with which it has been grouped. I declare an interest as honorary vice-president of English PEN, a council member of Justice which, together with the Index on Censorship, Article 19, Liberty and the National Union of Journalists, brought forward these amendments. I pay tribute to my colleague Dr Evan Harris, the MP for Oxford West and Abingdon, who introduced the amendments in the other place.
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