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I am sure that forthcoming speakers will bombard me with figures about the set-up and the running costs but, in preparation for that, I point to Chris Bolt, the PPP arbiter for London Underground-I am sorry about the title, but it is not my doing-as a model that could work. As established in a parliamentary Answer of 26 October, the General Lighthouse Fund already provides £98,000 for the activities of Department for Transport staff in the Lights, Navigation and Ports Safety Branch. That could be quite sufficient to fund a small regulator.

Some noble Lords may wonder why I am bringing this Bill forward today rather than waiting for the outcome of the study, but there are many urgent issues in the Bill, and the outcome of the study will be useful input to it. The inability or unwillingness of the Government to grasp this issue is why I propose the amalgamation of the three GLAs and introduction of a small, independent regulator to oversee cost reductions while providing a safe service.

I am encouraged that the Conservative Party supports the amalgamation of the three GLAs. Julian Brazier is quoted as saying on 24 March:

"Many in the industry are wondering why it is that we require three separate lighthouse bodies, when they could be brought together and efficiency savings made".

In a debate last month in another place, he confirmed this position, asking whether,

The present GLAs argue that they are doing a great job and have made many savings, but are they or their "sponsoring" department really the best people to make that judgment? This Bill is therefore designed to create a structure to remedy the situation, to merge the GLAs into a Marine Navigational Aids Commission and introduce a regulator-the Office of Marine Navigation Aids Regulation. It would allow the MNAC to undertake more commercial functions and includes the pension clauses, taken verbatim from the Government's Marine Navigation Bill, which underwent parliamentary scrutiny by the Transport Select Committee. It is important for me to acknowledge that the charitable work of Trinity House has been really good. It is not included in this Bill but needs to come under a separate debate. The Bill does not affect that element and should be kept distinct. Although I know that a number of noble Lords due to speak today are brethren, elder or younger, of Trinity House, and the charitable organisation does a lot of good works on many fronts, that is not a reason for preventing a restructure which would save a lot of money for ships coming into the UK. Independent regulation is the only way in which to restore confidence to those who pay light dues to ensure that their money is being spent wisely.



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In setting the light dues, the regulator would undertake its own studies into what costs of this super-GLA, as we might call it, were reasonable, as well as consulting interested stakeholders, governed by the overriding principle that safety is paramount. Independent regulation must be seen as a sensible and effective way in which to reduce costs and improve efficiencies in organisations that are effective monopolies. It works well in water, energy, telecom, air and the rail industry. In rail, independent regulation can claim most of the credit for Network Rail being required to reduce its costs by 50 per cent in 10 years while improving performance. This is in stark contrast to when the Department for Transport was the regulator of the High Speed 1 line and awarded a cost-plus contract to Network Rail to operate and maintain the line for 80 years. I do not think that Governments are good regulators.

Self-regulated organisations will always claim that they are very efficient and that no further savings can be made but, following regulatory intervention, they generally manage to achieve substantial savings that they previously said were unachievable. They inevitably lobby Governments hard to control the regulator, but most of the time the regulator process works itself through, and results are generally positive, with better service and quality, lower costs and more money for investments.

Much of the Bill involves changes to the Merchant Shipping Act 1995, but creating the MNAC or super-GLA would bring significant cost savings by eliminating the triplication of functions. The three GLAs could share a handful of back-office functions. The Bill aims to correct the nonsense of triplication with rationalisation of the corporate centre into a prudent, logical and sensible organisation, as Julian Brazier suggested. On the cost of senior managers and board members, according to the GLF annual report and accounts for 2007-08, Trinity House has four board members paid more than £70,000 and one paid more than £100,000. On the Commissioners of the Irish Lights, one board member is paid more than £70,000 and four more are paid £100,000. In total, the three boards cost more than £1 million a year, and a lot of savings could be made instantly with one super-GLA, seven to nine board members and a lesser remuneration package.

Some GLAs have argued that the regional knowledge will be lost, but the reform that I propose aims to tackle the back-office functions fully by completely rationalising the three corporate centres to make the savings. Regional stations should be in place under the proposed unified centre, but they would be ready for any further devolution of responsibilities to the Governments of Scotland, Northern Ireland or anywhere else, so I do not think that there is a real concern there.

There is a need for stronger regulation, and a smaller, independent regulator would restore badly damaged industry confidence. The regulator would be cheap to run, as I have said before, and would have a small office of one or two nominated senior people with back-office support, when required, from organisations that could be the Office of Rail Regulation or the CAA, both of which I have talked to-or, more logically, the MCA.



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Having consulted the GLAs and the shipping industry, I amended Clause 2 from the draft Bill, which was on reducing the number of board members and their prescribed attributes. The Bill makes provision for charges to be levied on the MoD vessels as well as pleasure craft, although no details are contained in the Bill because it will be a matter for the regulator, which would consult widely. That is not, as the GLAs have said, to increase the revenue from shipping or other sources, but to reduce the costs of providing these services, which is what the Bill aims to achieve. I hope that the Atkins report will help that.

In conclusion, it is time for decisive and bold action to restore the reputation of the UK as an attractive place to do maritime business. I acknowledge that the Bill may not make much further progress before Parliament dissolves, but I intend to keep up pressure on government to make these changes. I hope that a future Government would support this move to increased efficiency and reduced costs and could introduce the necessary legislation themselves-I hope while taking into account the contents of the Bill. Failing that, I shall bring it back at a suitable time in the next Session.

The department followed the huge increase in light dues with a second increase on 1 April. I know that my Conservative colleagues are with me when I urgently call on the Government to withdraw that second, harsh increase. As Jesper Kjaedegaard, the chairman of Maritime UK, said this week,

11.36 am

Viscount Simon: My Lords, I thank my noble friend for bringing this Bill forward again, giving us another chance to discuss it. He has given us a very detailed description of what it entails and all the bits and pieces associated with it. I shall address only certain items.

Together with other noble Lords, some of whom are here today, I spoke on this subject on 7 July last year and declared, as I do again, that I am a Younger Brother of Trinity House and a Master Mariner who, from time to time in years gone by, used the signals from lighthouses and buoys.

The Bill seeks to replace the GLAs and establish the MNAC in their place, with an Office of Marine Navigation Aids Regulation-OMNAR-to replace, in large part, the role of the Secretary of State in his responsibilities for the GLF and GLAs. As far as the GLAs are aware, there was no consultation with the Republic in terms of the proposed removal of the fading mechanism for its aids to navigation. Furthermore, the Bill fails to grapple properly with the constitutional issues associated with the Republic's position under existing legislation.

In terms of the Bill itself, it is unclear who is ultimately responsible for the provision of aids to navigation, following the creation of the MNAC and the establishment of the OMNAR. This concerns me

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and, I suspect, many others. A failure in terms of aids to navigation provision could be extremely costly in terms of human life, property and the marine environment. The "Tricolor" wreck, which sank in French waters in 2004, has cost something approaching $200 million. Furthermore, the Bill is unclear on the question of the transfer of existing assets and liabilities and how any transitional measures would operate. Nor does it mention the responsibility for wrecks, as Sections 252 and 253 of the Merchant Shipping Act 1995 place responsibility for wrecks outside harbour areas with the GLAs.

The Department for Transport has commissioned WS Atkins to conduct a review of GLAs and the management of GLF. Among its aims, it will address the funding regime-in other words, more light dues raised in Ireland resulting in less reliance on dues raised in England. It will also look at where future efficiencies can be made in GLA operation and support. The review will report in March, and its recommendations are unlikely to require major primary legislation. Devoting parliamentary time now to an issue that would largely be resolved looks somewhat inappropriate. However, the Bill presents an opportunity for ship owners to keep in the public domain their grievances about light dues and the GLA structure.

It has been estimated that significant costs would be incurred in setting up the new structure, particularly with regard to operating costs, redundancy, relocation, retraining and new infrastructure. These have been estimated at between £25 million and £70 million, or, to put it another way, between 12.5p to 35p on light dues, which the ship owner would have to bear. Would any ship owner approve of this potential increase to the running costs? I suspect not.

11.40 am

Lord Boyd of Duncansby: My Lords, I declare an interest as chairman of the Northern Lighthouse Heritage Trust, a body set up by the Northern Lighthouse Board to look after property that is no longer part of the General Lighthouse Fund. I was also a commissioner of the Northern Lighthouse Board for nearly 10 years.

In 1998 I was present at the ceremony of the automation of the last manned lighthouse in the northern lighthouse area, Fair Isle South. That was a sad and poignant moment because it marked the end of manned lighthouses and the fine tradition that went along with them. We owe a significant debt of gratitude to those who served in the past to keep our seas safe and those who now do so.

If the ceremony for the automation of Fair Isle was sad and poignant, I submit that it also marked a new beginning for the lighthouse service. Under successive chief executives, James Taylor and now Roger Lockwood, the NLB has reformed, modernised and gone from strength to strength, and I know that that is true of other general lighthouse authorities. In Scotland the operation has been slimmed down: the Granton base has long since gone, Stromness was closed during my time as a commissioner and operations are now based solely in Oban. The Pharos was replaced after only 13 years in service; it was deemed no longer fit for purpose, which showed both the pace of change that the lighthouse service had to match and the

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ability of the lighthouse authorities to invest in new ships. The tender for the new Pharos was submitted along with the new ship for Trinity House.

Costs have gone down. It is now a highly proficient, competent and efficient organisation. What my noble friend did not recognise is that with other general lighthouse authorities, the NLB kept the light dues at a level pace for 13 years, from 1993 to 2006. In 2006 light dues went down by 13 per cent, a decrease that was forced upon the general lighthouse authorities at the behest of the industry. That now looks like short-termism on its part.

The GLAs do not operate independently but, increasingly, in partnership. The ship agreement is one aspect of that but they also have set out a collective vision, first in 2020 The Vision and updated recently in 2025 and Beyond. Those documents have set a course for the general lighthouse authorities for the future.

My noble friend has raised the Irish question. There is one part of me that never quite understands the logic of this. Lighthouse dues are paid on the basis of visitations to ports, not on actual use of the lighthouse. Those who pass Fastnet or Tuskar Rock do not close their eyes on the basis that they are passing a lighthouse in a foreign jurisdiction and they ought not to be paying for it; I am sure that they often welcome them and in some cases have been relieved to see them. My noble friend says, rightly, that it is a foreign country and we do not pay for any lighthouses in any other foreign jurisdictions. That is true, I grant him that, but that attitude still seems somewhat counterintuitive on a day when we have had an announcement of further devolution to Northern Ireland, and the example of British-Irish co-operation over lighthouses was specifically acknowledged in the Good Friday agreement in 1998. In any event, the Irish Government are now separately subsidising the lighthouse authorities, and negotiations will no doubt continue on that matter.

I have studied the Bill with some care. It may be my fault but I am unclear on whether the existing GLAs, after the introduction of the super-GLA that my noble friend has described, will have any continuing function. I have looked in vain, for example, for any clauses that relate to the transfer of assets and liabilities or the winding-up of the GLAs. They are not there. There is mention of the board of the Northern Lighthouse Board coming out of the Merchant Shipping Act 1995, but there is no mention of what exactly would happen to the existing lighthouse authorities. Would they continue in any shape or form? No doubt my noble friend will address that when he comes to reply.

In any event, what exactly would be the solution to this problem? As far as I can see, it would be the creation of two new quangos, whether in addition to or instead of the existing one. We would have a Marine Navigation Aids Commission, no doubt replete with a new headquarters, chairman, chief executive, expenses, pension, corporate strategy, HR, disability information strategies-the lot. If that were not good enough, we would then have a separate body to oversee the first: a marine navigation aids regulator. One is reminded of the old woman who swallowed the spider to catch the fly.



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If ship owners have been pressing for this, one has to question whether they have really thought it through. My noble friend says that it is to support competitiveness, but in fact-with the greatest of respect for him-he would be increasing the amount of bureaucracy involved and therefore, as my noble friend Lord Simon said, increasing the costs. I would be grateful if he explained to us in more detail what the relationship would be between the new bodies and the existing general lighthouse authorities.

I come back to the Scottish issue. Has my noble friend consulted Scottish Ministers? He will say, rightly, that the issue of lighthouses is a reserved matter, but the fact is that there is a close relationship between the Northern Lighthouse Board and the Scottish Government, there is a concordat between the Department for Transport and the Scottish Government that inter alia covers lighthouses, and the Northern Lighthouse Board is regarded as a significant part of Scottish life. I have not mentioned the Isle of Man, but that is true there is well. He will find, if he presses this, that there is considerable opposition in Scotland, not just from an SNP Administration but from any other Administration that is likely to come in, as well as from the public; the NLB is regarded as part of the fabric of Scottish life, and they will not look favourably on the downgrading or abolition of the Northern Lighthouse Board with some centralised quango in its place.

I hope that my noble friend will in time go away and reflect on exactly what he is attempting to achieve by this. There are legitimate questions to be asked about the operations of the general lighthouse authorities, but the answer is not to tear up the existing structure; rather, it is to ensure that it works better and more efficiently in the future.

11.50 am

Lord Greenway: My Lords, I will make a few brief comments if only because I am recovering from a heavy cold and I am not certain how long my voice will last. I declare a non-financial interest as an Elder Brother of Trinity House.

One has to admire the tenacity of the noble Lord, Lord Berkeley, who continues to bring his question before us at every opportunity. He mentioned that his timing might be a little awry at the moment. Obviously, it was the usual channels' decision as to when his Bill would get a Second Reading, but the timing is unfortunate. As has been mentioned, there is yet another review going on into the General Lighthouse Authorities-the Atkins review-one of a number over the past few years, and that is due to report next month. Although this gives us an opportunity to discuss the whole question of light dues once again, we might be wasting our time because nothing will happen until the Government have seen the results of that review. The noble Lord admits that he does not expect his Bill to make much further progress and we will have to see. But it is probably unlikely.

The Irish question has been referred to several times. It is really the fly in the ointment and the one thing that really annoys the ship owners. As has already been hinted at by the noble Viscount, Lord Simon,

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this new arrangement is under an international treaty. It is not as easy as the noble Lord, Lord Berkeley, suggests to walk away from international treaties. These things require careful consideration. The other problem, as we all know, is that the majority of light dues are paid by ships visiting English ports-something like 87 per cent. Scotland and Ireland would find great difficulty if they had to pay for their own navigation aids. Ireland gets comparatively few ships these days and if it was forced to charge realistic light dues, the dues would be extremely high and probably no ship would go to Ireland anyway.

There have been several misconceptions with regard to figures-the noble Lord who preceded me mentioned this. This is something that does not come out very often, but ship owners always scream about this huge increase in light dues. Admittedly it is large, but, as the noble Lord, Lord Boyd, said, light dues have not risen since 1993 and were reduced on several occasions since then resulting in a 50 per cent decrease. As has been said, in 2006, there was an opportunity to raise light dues, but it was resisted. That was unfortunate because ship owners at that time were enjoying successful markets and most of them were making large sums of money. An increase then would have been easily absorbed and nobody would even have considered it. However, the shipping industry has taken a huge downturn during the recession and these rises coming through now-one recently and another one due later this year-will hit it harder because it has been going through such lean times.

The recovery is starting, if slowly. Certainly, I was looking at figures only yesterday for a large French shipping company. Its revenues on the Asia-Europe run, which is the main trade lane, are certainly beginning to rise and rise more quickly. We hope that difficult times are past and that ship owners soon start making reasonable money again. The noble Lord mentioned charges of thousands of pounds per ship, but within the overall costs of running a ship, they are still remarkably small.

There is some conception that these services are provided free in a lot of other places around the world. That is not true. Ours are up front and visible. It is the user-pays principle, which the Government and the EU champion. In other countries it may be paid by direct taxation or included in general port charges. There is no evidence to suggest that ships are charged more in this country-there is no direct figure available-but it seems that the costs of provision of navigational aids is roughly the same wherever you are. Ship owners are paying wherever they go: it is only because they have a huge bill put in front of them every year that they complain.

The noble Lord, Lord Berkeley, also mentioned ships turning away from this country due to the charges, but I question those figures. Maersk Line, the largest container line in the world, has only recently brought its largest container ships into Felixstowe. Only four or five tankers ever built have been larger than these ships. They are extremely large and carry up to 15,000 20-foot containers. When they were introduced a few years ago, they made two initial visits for promotional purposes into Felixstowe and then the service was run

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from the north continental ports. The fact that Maersk has now decided to bring the ships into Felixstowe tells me that this great worry about light dues is perhaps not as great as one might imagine.

There seems to be an almost insatiable appetite to modernise or, in other words, tear down or destroy institutions that have been around for many hundreds of years and replace them with a new set-up that may well prove to be less efficient, could well cost a great deal more-there was mention from other speakers of possibly up to £50 million more under this Bill-and which could have all sorts of unintended consequences. The three general lighthouse authorities have worked efficiently together to provide seamless provision of aids to navigation in what amounts to 20,000 miles of some of the most dangerous waters in the world. Anything that upsets that balance should sound a warning note.

Another example of how these cross-border organisations work is the Royal National Lifeboat Institution. It has worked perfectly satisfactorily in Ireland as well as the rest of the UK for many years. I know that it is a charity funded entirely from donations, but it shows how these organisations can work-as indeed the lighthouse authorities work together well with their Irish partners.

I cannot say that I wish this Bill well in any way at all. In fact, I sincerely hope that it has a quiet death, but I have no doubt that the noble Lord will persist. Perhaps we shall look forward to debating this again in a new Parliament. But I have a feeling that the new Government of whatever colour will have their time taken up by far more pressing matters than light dues.

Noon

Lord MacKenzie of Culkein: My Lords, I welcome the opportunity that the Second Reading of my noble friend's Bill gives us to discuss this important issue. Aids to navigation may seem rather esoteric to many people, but that belies their importance to the safety of the mariner and the security of the marine environment. I have an interest in this issue: I was born and brought up in the lighthouse service in Scotland, and I served as a lighthouse keeper for a few years in my younger days.


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