Seafarers’ Wages Bill [HL] - Second Reading

– in the House of Lords at 4:03 pm on 20th July 2022.

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Baroness Vere of Norbiton:

Moved by Baroness Vere of Norbiton

That the Bill be now read a second time.

Photo of Baroness Vere of Norbiton Baroness Vere of Norbiton Parliamentary Under-Secretary (Department for Transport)

My Lords, earlier this year, P&O Ferries shamefully sacked almost 800 members of its workforce, without notice and without consultation. At that time, the Transport Secretary responded with a nine-point plan, aiming to prevent companies from benefiting further from such underhand and unacceptable moves. This legislation is part of our response. It is important to stress that this is but one part of the plan, which covers much wider aspects of seafarer welfare that do not require legislation.

This Bill delivers on the Secretary of State’s commitment to deliver on the first point of the nine-point plan: changing the law so that seafarers with close ties to the UK are paid at least an equivalent to the UK national minimum wage while they are in UK waters. Quite simply, it is unacceptable for companies such as P&O Ferries to lay off hard-working employees, with no notice and no consultation, only to replace them with less costly workers. This legislation will remove the incentive for other operators to follow suit and ensure that all seafarers will receive the equivalent of the national minimum wage in UK waters, preventing a race to the bottom that would damage this vital industry.

Under the existing national minimum wage legislation, not all seafarers who regularly call at UK ports are currently entitled to the UK national minimum wage. It cannot be right that seafarers who frequently work in the UK are not entitled to the same remuneration as other workers simply because they work on an international, rather than a domestic, service. In every practical sense, the seafarers who work on routes such as Dover to Calais are working in the UK, and they should not face exploitation by unscrupulous employers who seek to use this gap in the law to avoid paying fair wages.

The purpose of the Bill is to right this wrong. It will do this by making access to UK ports conditional on operators of frequent services providing evidence that the seafarers on board are paid a rate equivalent to the UK national minimum wage for time spent in UK waters. This will bring hundreds of millions of pounds of extra pay to thousands of seafarers over the next 10 years.

It is important to note that this legislation does not amend the National Minimum Wage Act. It instead refers to “national minimum wage equivalence”. I should point out that the Bill has been the subject of a public consultation, where we invited views on both its scope and the proposed compliance process. We have taken enormous care to consider the consultees’ views and have taken these into account in designing the new legislation.

The legislation will apply to services calling at UK ports at least once every 72 hours, on average, throughout the year. This equates to 120 times a year. The operators of such services will be required to provide a declaration to the relevant harbour authority that they are paying their seafarers no less than a rate equivalent to the national minimum wage. This rate will be calculated according to regulations made using powers in the Bill.

This scope definition has been carefully designed to ensure that it includes those seafarers who have close ties to the UK. We listened to those in the industry who told us that inclusions or exclusions based on service type would create market distortion and ambiguity. Fishing and leisure or recreation vessels are therefore the only specific exclusions retained on the face of the Bill. Our analysis shows that this definition captures, for example, the vast majority of ferries on the short straits, without including services such as deep sea container services or cruises. These less frequent services remain out of scope as those seafarers cannot be said to have as close a link to the UK. This definition has been formulated to account for the complexity of categorising vessel and service types, and to ensure that those seafarers with the closest ties to the UK are captured. We will continue to engage with industry throughout the passage of the Bill, and through consultation on the subsequent secondary legislation and guidance.

Ports are our main contact point with these vessels. In order to keep focused on this domestic link, the legislation will make access to ports ultimately conditional on compliance with its requirements. Harbour authorities will be empowered to request declarations from operators within scope that confirm they will pay their seafarers a rate equivalent to the national minimum wage. If they do not comply with the requirement, harbour authorities will be empowered to levy a surcharge against those operators, or they may be directed to do so by the Secretary of State. The purpose of the surcharge is to ensure that not paying the national minimum wage equivalent is not a financially viable option for the operator.

We intend to consult on regulations and guidance on the framework within which the level of the surcharge will be calculated and the exercise of the harbour authorities’ powers in due course. The harbour authority may retain such money as may be raised in this way for the discharge of its functions or for the provision of shore-based seafarer welfare facilities. We are clear that this will not be a profit-making exercise.

On non-payment of a surcharge, the harbour authority will be empowered to deny access to the port, either of its own volition or by direction from the Secretary of State. We intend these powers to provide sufficient deterrent to ensure compliance by operators. We have engaged extensively with the ports industry on this role, and while we accept that this will be an extra administrative burden on ports, we are satisfied that it is proportionate and effective, particularly taking into account the resources and capabilities of the ports and their existing transactional relationship with visiting vessels.

I am clear that this is not an enforcement role for the harbour authority. Beyond accepting declarations, they will not be responsible for checking that operators are complying with the requirement to pay national minimum wage equivalence. This enforcement role will be fulfilled by the Maritime and Coastguard Agency, or MCA, which will undertake inspections and investigations. It will also be empowered to prosecute operators who are found to be operating inconsistently with a declaration or who do not comply with investigations. Those found guilty of an offence will be liable to a fine on summary conviction.

As I stated earlier, this Bill is only one part of the Government’s nine-point plan to improve seafarer welfare. We are clear that this legislation will not solve all the issues brought to light by P&O Ferries’ actions, but it is an important step, and it is the right one to take given the parliamentary time available. The Bill is inevitably of limited application as we cannot legislate outside UK jurisdiction and therefore cannot make provision for time spent outside UK waters. This is why we are discussing bilateral minimum wage corridors with other countries to encourage the payment of fair wages on the entire route. As part of the plan, the Department for Business, Energy and Industrial Strategy will bring forward a new statutory code on so-called fire and rehire when parliamentary time allows. The Department for Transport is also taking steps to encourage more ships to operate under the UK flag, and to improve the long-term working conditions of seafarers beyond pay protection. So, although this legislation is concerned only with wages, the Government remain focused on the whole gamut of seafarer welfare and taking non-legislative steps to make much-needed improvements. This legislation is vital as part of our efforts to ensure that hard-working seafarers, who play a critical role in our economy, can no longer be mistreated or exploited by unscrupulous employers.

In closing, I also recognise that some noble Lords may have a slightly more nuanced reason for participating in today’s proceedings: a hugely experienced and deeply committed parliamentarian and public servant will be making his valedictory speech. I know that this House, and so many people beyond it, hold my noble and learned friend Lord Mackay of Clashfern in the highest esteem, and we are incredibly grateful for his many years of service to our country. I am looking forward to contributions from noble Lords on the retirement of my noble and learned friend and, of course, to their wise words on the Bill before your Lordships’ House today. I beg to move.

Photo of Lord Hacking Lord Hacking Labour 4:13 pm, 20th July 2022

My Lords, if I may, I should like to speak in anticipation of the valedictory speech of the noble and learned Lord, Lord Mackay of Clashfern, before I move to the terms of the Bill. Like all Members of the House here present, I very much look forward to hearing his valedictory address, but, like them, I do so with sadness that this is the last time we will hear the noble and learned Lord speaking from our Benches.

I am in rather a special position—although I think I see at least two noble Lords who were here 43 years ago in 1979. They are both nodding, so I am correct in that assumption. However, I am the only person who has put his name down to speak in this debate who was here when the noble and learned Lord arrived 43 years ago in 1979 as the new Lord Advocate, coming, as I recall, from being Dean of the Faculty of Advocates in Edinburgh.

Moreover, very shortly after his arrival in this House, I had the honour of working very closely with him on the Protection of Trading Interests Act 1980—I think the noble and learned Lord will remember it. It was quite tough on him to take on that Act, which was a complicated one, so soon after his arrival in the House. I believe that the then Lord Chancellor, Lord Hailsham, funked taking on that task, although the noble and learned Lord has never used those words to me. The nature of that Act was to protect a major UK company from the ravages of US anti-trust law. The entry into the area of US anti-trust laws did not deter the noble and learned Lord, with his swift intellect. I had just come back to this House after four and a half years practising law in New York; I knew something about anti-trust law and I hope I was helpful. Later, I remember working with the noble and learned Lord, when he was Lord Chancellor, on another very complicated Act, the Human Fertilisation and Embryology Act 1990. Once again, such an Act needed his great intellect.

My clear memory of the noble and learned Lord throughout his time in this House was of his great intellect and great stamina. At no time was this exhibited more clearly than during the passage of the Courts and Legal Services Act 1990. It started with a Green Paper for debate on a Friday—I suppose it must have been in early 1990. I will explain the circumstances of that in a moment. The Thatcher Government, after sorting out the trade unions, somewhat bravely decided to sort out the legal profession. It was agreed that the beginning of this sorting out should take the form of a Green Paper—a discussion paper—which was put before the House. Therefore, on this Friday sometime in early 1990, we convened at 10 am and must have gone on past 10 pm or 11 pm, or perhaps just after midnight. The beginning was quite eventful because the Bishop was not here, and the noble and learned Lord had to say Prayers before we could start our business that day. Thereafter, he sat on the Woolsack down there for almost the whole day, never leaving it, always listening to the argument, not even taking any notes but patiently listening to all that was said. He was there for 12, 13 or 14 hours and ended up giving a brilliant extempore summing up very late at night—using, as I mentioned, hardly a note.

It was not altogether an easy debate for the noble and learned Lord. The legal profession on the Bar side was furious with the provisions proposed by the Government of the day, and so were many members of the judiciary. As it happened, exactly on the Bench where the noble and learned Lord, Lord Judge, is sitting, I was sitting next to Lord Geoffrey Lane, the then Lord Chief Justice. He rose as I sat beside him and turned on the Lord Chancellor, saying that he had not even had the courtesy to write to him about these measures before introducing the Green Paper. However, Lord Lane had not taken into account the enormously good memory of the noble and learned Lord, Lord Mackay. He remembered that sometime earlier, when the Green Paper was being produced, he had received a handwritten letter from Lord Lane to say that he did not think it was appropriate for the Lord Chief Justice to be involved the discussion of these proposals. That placed Lord Lane in rather an awkward position. However, the noble and learned Lord, Lord Mackay, with his characteristic kindness, raised that issue very tactfully only in his final summing up, just referring to having received that letter.

Not only was the noble and learned Lord under attack from Lord Lane, he was under greater attack from Lord Donaldson, who actually used the words, “Take your tanks off my lawn”. Again, the noble and learned Lord received that with great good temper and wisdom.

I remember having the privilege of seeing the noble and learned Lord when he was finishing as Lord Chancellor. It was sometime in 1997, as the general election result had been announced. He very kindly agreed that I could have a brief word with him before he departed from office. Thereafter, he moved to where he is now sitting, the Bench immediately behind the Ministers. It is a Bench that he has used over many years—for 22 years of which I was not here, but I saw him there from 1997 until I left in 1999 and saw him there again when I returned to your Lordships’ House.

Every so often, the noble and learned Lord stands up and give some words of wisdom. I am a bit worried now for the Government and Ministers, who will no longer have those words of wisdom to guide them through their business. I fear they must just live with that, because the noble and learned Lord is leaving us.

I should like to bring everything up to date, because on Monday the noble and learned Lord was sitting in exactly the same place throughout the rather long debates on the Schools Bill. He did not intervene, but he was still sitting there.

It is about time I turned to the Bill itself. I was in the Royal Navy and I remember that the noble Lord sitting opposite was also a national serviceman in the Royal Navy with me. He may have been guilty of a sin, the information thereon I should like to pass on to the House. I remember that in the Royal Navy we saw a lot of commercial ships, and we saw the seaman coming off at various ports all around the world. We all wondered how well they were being treated, what their wages were and whether they were being kept in difficult or squalid circumstances.

I look towards the noble Lord, Lord Geddes, because he was out in the Far East, and I was not, so I was not guilty of this sin, but it was said that in the Far East the Navy was considered not very good with its washing, and Chinese personnel were taken on board our ships while we were out in the Far East. They may have been taken on board the ships on which the noble Lord was an officer; I give him an opportunity to reply. They were kept there, not in very good quarters—I do not know anything about their pay—and then they were dumped when the ship returned from the Far East.

Although my Navy days are long over, the Bill’s terms seem sound and it should be supported.

Photo of Baroness Bakewell of Hardington Mandeville Baroness Bakewell of Hardington Mandeville Liberal Democrat Lords Spokesperson (Environment, Food and Rural Affairs) 4:23 pm, 20th July 2022

My Lords, it is a pleasure to follow the noble Lord, Lord Hacking. I look forward to the speech of the noble and learned Lord, Lord Mackay of Clashfern, and will certainly miss his knowledgeable interventions in this Chamber. I regret that I am delaying the House from hearing from him.

This rapidly drafted Bill is the Government’s attempt to avoid a similar scenario to that witnessed earlier this year, when P&O dismissed nearly 800 of its crew with no warning to the Government and no consultation with its staff. The Government took swift action to condemn P&O. Peter Hebblethwaite, chief executive of P&O, told the other place that P&O intended to bring in a different operating model, employing fewer staff paid for only the hours they worked. This implies no holiday or sick pay. This averages at £5.50 per hour, down to a minimum of £5.15 per hour. The current national minimum wage is £9.50 an hour. P&O executives were shameless in their responses to questions in the other place, stating that they had knowingly broken employment law by not consulting unions, although they knew they were legally obliged to do so. In the words of Peter Hebblethwaite:

“We chose not to do so.”

This was a clear gesture to the employment law of the UK—that it could be totally ignored and that P&O would operate its own conditions. UK employment law requires a company intending to make more than 100 employees redundant to give 90 days’ written notice to the authorities of state where the vessel is registered, 45 days in advance of the redundancy date. The vessels concerned were registered in Cyprus, the Bahamas and Bermuda. At the same time as the crews were notified of redundancy, the letters were also sent to the authorities of state. This is not 90 days’ notice, nor 45 days before the redundancy date. The way in which P&O operated was totally outrageous and I fully support the Government in bringing forward a Bill to attempt to prevent this happening again.

The Government have brought forward a nine-point action plan, as the Minister stated, to ensure that seafarers on ships using UK ports are paid the national minimum wage. Everything in the nine-point plan hangs under this first point. This is not a large Bill, but I fear that it may not be straightforward.

Clause 2 specifies what a non-qualifying seafarer is. It appears that a situation could arise where some of the crew on a ship qualify for the minimum wage and some do not. This is not likely to result in what could be described as a happy ship. Can the Minister please clarify this?

Clause 3(3) states that a qualifying vessel must enter a UK harbour or port on 120 occasions a year, which equates to three a week. This is obviously geared towards the ferry industry, where roll-on roll-off ferries operate several times a day on short hauls to France, Belgium and other countries, and on a daily basis to Spain. This is not likely to cover the huge cruise ships which visit far less frequently, at the most weekly, depending on their routes.

I turn now to the declaration of whether the crew are paid the national minimum wage and how it is to be implemented. The Bill stipulates that the harbour authorities in each area will implement the conditions of the Bill, check the authorisations and impose fines where necessary. These fines or surcharges are to be set by the individual harbour authorities and ports and must not exceed level 5 in Scotland and Northern Ireland, where this is £5,000. This figure is not likely to deter an owner operating a profitable route carrying thousands of passengers.

The Seafarers’ Wages Bill brief was unequivocal: harbours and ports should not be involved in setting the fees or monitoring the declarations. Since many ferry operators own their own terminals, they are the harbour authority. In effect, they will be marking their own homework. There is definitely a conflict of interest here. Also, if different rates of surcharges are imposed around the coast, the owners of vessels will choose the ports with the lowest surcharge. The preferred option is for the Secretary of State to set a standard surcharge. It is unclear whether the surcharge is applied per vessel, per crew member on the vessel, or depends on the actual port used. This will need clarification in Committee.

A standard surcharge set by the Secretary of State takes away local discretion. I assume that any surcharges collected would be for the harbour authority to spend on improving services for those visiting the port, and infrastructure projects. Perhaps the Minister can clarify this. I look forward to the Minister’s response. Now, your Lordships can hear from the person you have all really come to hear from.

Photo of Lord Mackay of Clashfern Lord Mackay of Clashfern Conservative 4:29 pm, 20th July 2022

My Lords, as I rise to address your Lordships for the last time, I am standing immediately behind the place from where I made my maiden speech in 1979, moving an amendment in a Scottish criminal justice Bill—which, I am glad to say, was accepted. A short distance may make a big difference in status, as your Lordships have noticed.

I thought, if your Lordships will permit me, it might be of interest to give a summary of the responsibilities I had in the two offices I held, which have now completely changed. Before doing so, I wish briefly to support this Second Reading. For most of the time since 1972, I have been a member of a lighthouse authority with concern for the vital importance of seamen and their terms of service. Our legislation can regulate these for seamen who serve within our territorial waters but, if part of that service is outside those waters, special provisions will be required. This Bill deals neatly with such a case and I give it my full support.

With your Lordships’ permission, I now come to say a little about the two offices I held. The first was the Lord Advocate of Scotland, with the first two responsibilities I will mention shared with the Solicitor-General for Scotland. The first was the representation of the Government in the courts of Scotland, advising the Government on Scots law and, in conjunction with the Attorney-General, on European law, which applied throughout the United Kingdom at that time. To assist in that responsibility, there was a staff of lawyers and other civil servants in the Lord Advocate’s office in London. We had responsibility for drafting Bills for Scotland and those parts of United Kingdom Bills that required special attention to conform with Scots law requirements.

My second responsibility was for the prosecution service in Scotland, consisting of the Procurator Fiscal Service throughout Scotland, the Crown Office in Edinburgh staffed by members of the Procurator Fiscal Service, the Crown Agent at the head of that service and advocates who are appointed from the Scottish Bar to make judgments on the most important cases. Two Members of your Lordships’ House—the noble Lord, Lord Campbell of Pittenweem, and the noble and learned Lord, Lord Hope of Craighead—were in that team. I personally took some of the fatal accident inquiries and prosecution litigations that were the responsibility of my office. That concludes the responsibilities that I shared with the Solicitor-General for Scotland.

I was invited by a number of departments to assist in this House with their legislation. The noble Lord, Lord Hacking, earlier gave at least one example of that happening. This gave me an opportunity to know those departments extremely well and I cherish that experience. I was also nominated by the Attorney-General, then Sir Michael Havers, to represent the Government in cases in this House and in the Court of Justice of the European Union. In representation in this House, in one case I had the advantage of having the noble and learned Lord, Lord Brown of Eaton-under-Heywood, as my junior. Needless to say, we won. As I said, I was invited by a number of departments to assist in this House with their legislation and that was important for developing my chances in later times.

After five years in the office of Lord Advocate, I was nominated by the then Secretary of State for Scotland to be a judge in the Scottish courts. When that became known in this House, I happened to be paying my bill in the Peers’ Dining Room and Lord Elwyn-Jones said to me, “James, I’ve just heard that you have been appointed a Scottish judge. I’m very sorry; I had hoped for better things for you.”

I was appointed a Lord of Appeal in Ordinary in 1985 and served in that capacity until October 1987, when I was invited to become the Lord Chancellor as my predecessor and excellent friend, Lord Michael Havers, had resigned on the ground of ill health. So I become the Lord Chancellor, an unprecedented experience for a member of the Scottish Bar who had not been a member of the English Bar.

The first responsibility of that office was to officiate in this House, and that I did for almost 10 years. This involved taking part as the Lord Chancellor independent of the Government when I sat on the Woolsack or stood in front of the Woolsack, but it also involved representing the Government, and when doing so, I stood two steps to the left. It was the Liberal Democrats who were there at that time. Things have changed in that respect, as your Lordships know.

In the House, the Lord Chancellor presided. He represented the House on ceremonial occasions, taking part where appropriate. He received new Members on their introduction, first in his office and then in the House in a ceremony while wearing a hat that Matthew Parris described as a Cornish pasty. He received and visited foreign Speakers of Parliament, Presidents, Prime Ministers and senior judges. He attended meetings of Commonwealth and European Speakers in company, usually, with the Speaker of the House of Commons and the Clerk of the Parliaments or an official of his department. He also attended other ministerial meetings. As noble Lords have heard, he read Prayers if the Bishop was prevented from attending—I think I had three opportunities to do that in the 10 years when I was Lord Chancellor.

The Lord Chancellor was a member of the Cabinet. I was given fourth place in the Cabinet on appointment. When Mrs Thatcher retired, I sat next to the Prime Minister and paid her the Cabinet’s tribute on its behalf, the draft being kindly prepared by Robin Butler—the noble Lord, Lord Butler of Brockwell. I was in the Cabinet as a member of the judiciary and the legislature, the others being members of the legislature.

As a law officer, I had not been a member of the Cabinet. It was a tremendous honour and heavy responsibility to represent the judiciary in the Cabinet, but I felt that it was a very necessary and important responsibility, and I was anxious to discharge it properly. I had the responsibility for the civil law that was not already the responsibility of another department. This included organisations such as the Law Commission, the National Archives and the Land Registry. I introduced to this House legislation that was in accordance with the government policy for the Lord Chancellor’s Department and also other legislation which the Ministers concerned invited me to lead on in this House. I think that the most important of the Bills that I had responsibility for were the Children Act 1989 and the Human Fertilisation and Embryology Act 1990. They have both stood the test of time in their structure ever since. Looking back on it, I think that is due to the amount of consent we got in this House and in the House of Commons—of course, I was primarily concerned with the House—and were able to work up in the course of negotiation here.

I also introduced, at the request of the then Home Secretary, a Bill that mentioned the Security Service publicly in Parliament for the first time. I was responsible for various legal aid and other enactments and statutory instruments. I introduced the Courts and Legal Services Bill, which has already been referred to and which came along as a matter of some controversy with the Bar and some of Her Majesty’s judges. I do not intend to describe the detail of that any further than has been done already. I am glad to say that it went through both Houses of Parliament with very little amendment and, so far as I know, nobody has tried to amend its principles since it became an Act.

The Lord Chancellor was head of the judiciary and responsible for the court system and provision for the judges—for example, for training and accommodation on circuit. Toward the end of my time in office, responsibility for magistrates’ courts was transferred to the Lord Chancellor. Like Lord Hailsham before me, I presided over a substantial number of sittings of the judicial committee of the House or of the Privy Council.

I had the responsibility of nominating the senior judges to the Queen and the most senior to the Prime Minister. To assist me in that responsibility, there was a small group of officials in the Lord Chancellor’s Department. This time is sometimes referred to as the “tap on the shoulder” time, but I have to say that I have no memory of tapping anyone on the shoulder as a preliminary to seeking to nominate him or her as a member of the senior judiciary.

The circuit judges and other judges were also appointed on the nomination of the Lord Chancellor and, again, the group in the department assisted. I took the view eventually that it was right that it should be done by a committee interviewing the candidates, including a magistrate, because I thought it important that the judicial quality of the person would be estimated. I made it my business to try to estimate that as carefully as I could. I sometimes had the opportunity of hearing candidates when I was sitting as the presiding judge in a session of a judicial committee, but I also had opportunity to study that in other ways. All the judges I nominated came to this House to be sworn in by me. My wife entertained them and their families in the River Room to tea or coffee as appropriate. I do believe that particular service was much esteemed by the people who got it. I do not think it continued.

As direct rule operated in Northern Ireland, I had similar responsibilities there for the court system and judicial appointments. A senior judge had been killed, the Chief Justice had been shot at and a judge’s home had been blown up, so these appointments were a solemn responsibility. I am humbly thankful to Almighty God that no further damage was done to the judiciary in that way, although the risk continued. I should also like to mention the wonderful way in which the court service in Northern Ireland dealt with its work. On one occasion its headquarters was damaged by an explosion at the weekend, and first thing on Monday morning they were clearing up the broken glass.

The Lord Chancellor had the responsibility of nominating Queen’s Counsel for England and Wales. Again, he was assisted by the group in the department. I consulted the senior judges and considered it right to have regard not only to success of advocacy in court but to the importance of sound advice to clients that might prevent them having to go to court.

This concludes my summary of the responsibilities I held in office. All are now changed, so I hope a record of them may be of interest. I handed over to the noble and learned Lord, Lord Irvine of Lairg, who I regret to say is now on leave of absence on account of his ill health.

This House has a special place in my regard and I wish to thank, from the bottom of my heart, all the Members of this House, past and present, who have shared with me membership of it. I feel the same for all the staff of the House. It applies to the Clerk of the Parliaments and all the staff in the offices, the staff of the usual channels, the committee staff, the expenses staff, the doorkeepers and the attendants; it applies to those who help us in the restaurants and in banqueting and with computers and telephones, the police and security, the engineers and the people who help us in many other ways including, of course, the cleaners. I particularly want to mention those ladies whose job it is to clean the huge number of books that are covering our corridors. I have spoken to them very often and it is wonderful to see how cheery they are, considering the nature of their employment. They really do a great job, and I would like to thank all the staff for the help that they have been to me.

I wish to thank my family for all the support they have given me. Above all, I have to thank my dear wife of 64 years for her devoted support and wonderful patience. I have been twice appointed a Life Peer and, having reached 95 years of age, am now being given the opportunity to retire from membership. I do it with gratitude, and the happiest of memories, on 22 July.

I believe that I have been sustained until now by answers to what we pray for at our opening every day. Thank you very much.

[Applause.]

Photo of Lord Strathclyde Lord Strathclyde Conservative 4:47 pm, 20th July 2022

My Lords, on behalf of the whole House, may I be first to congratulate my noble and learned friend and thank him for his many years of service to our country, to this House and to the legal profession? During the course of his speech, he exemplified just why he is held in such high affection by so many of those in the House today.

There is of course no one else quite like my noble and learned friend. As the noble Lord, Lord Hacking, pointed out, he is not alone in being a long-serving Member of your Lordships’ House—since 1979—nor in being a long-serving Member holding high office in a manner of true distinction. It is rather the way in which his personality has transcended those positions. He has brought a style and composure born out of his natural humility and intelligence, which makes me feel that, while this is a fitting occasion, it is also a very sad day indeed.

My noble and learned friend held the position of Lord Advocate for five years but is renowned for his role as Lord Chancellor, a position he held for 10 years to 1997. When that post was abolished from your Lordships’ House, Lord Howe of Aberavon thought it wrong because of the difference made by what he called the “looming presence” of the Lord Chancellor at the Cabinet table. It was my noble and learned friend who was that looming presence for so long.

He may well have stopped looming at the Cabinet table, but his presence in this House has been no less influential. From across the House, he is admired for his humility and moderation. My noble and learned friend still intervenes from time to time to make a point based not only on his great wisdom and experience but, perhaps most of all, on his humanity. To say that he will be missed from this House and our national deliberations is a severe understatement.

If ever an example were needed of how our United Kingdom benefits from a man who came from such a humble start in the Scottish highlands, the son of a railway signalman, and scaled the greatest heights of achievement and respect, it is my noble and learned friend Lord Mackay of Clashfern. Throughout his years of service, and particularly during his time as Lord Chancellor, he has been wonderfully supported by Lady Mackay, who has been ever-present at his side. We will miss them both, as they head north to a calm, peaceful and well-earned retirement. All of us are better off for having known them, and we wish them well.

I turn briefly to the Bill—

Noble Lords:

Oh!

Photo of Lord Strathclyde Lord Strathclyde Conservative

Since I cannot really improve on what my noble and learned friend and the Minister said, I say that I wholeheartedly support the Bill and hope that it will reach the statute book speedily.

Photo of Lord Shipley Lord Shipley Chair, Youth Unemployment Committee, Chair, Youth Unemployment Committee 4:52 pm, 20th July 2022

My Lords, this is a very important occasion. We have just heard the deeply impressive valedictory speech of the noble and learned Lord, Lord Mackay of Clashfern, whose knowledge of constitutional and legal matters and of the proceedings of this House is unequalled. We have appreciated his forensic thinking and analysis, and the sound advice that he has given to this House over so many years. We thank him for that and we shall miss him.

The Bill is the outcome of the need to address poor employment practices and low pay in the seafaring industry. The nine-point plan that the Minister referred to is a very positive set of proposals and reflects the right approach. The Bill, specifically, is a solution to the very immediate problem of low pay.

In practice, it is quite limited. It is reasonable to ask ship operators to provide the necessary declarations on a periodic basis. This will deter companies from paying less than the national minimum wage to ferry crews when sailing regularly to or from UK ports. Since “regularly” is defined as at least 120 times a year, this seems about right. UK-flagged vessels should not face a disincentive to employ UK-resident seafarers. However, it is the application and occasional enforcement of this legislation that we will need to look at closely in Committee.

Put simply, will it work? I think that it can, if all organisations involved own the objective and take responsibility for actions where they can. There does not need to be a big problem with implementation if it is seen as a shared problem. I understand the concerns of the ports that this regulatory work would be new work for them, and there is a strong case for agreeing that any prosecutions should lie with the Maritime and Coastguard Agency. Overall, this is about a proportionate balance of roles between the stakeholders, of which there are several: the Secretary of State, with powers to enforce the law and, in particular, to direct a harbour to refuse entry; the Maritime and Coastguard Agency; HMRC; and the harbour authorities themselves. These roles will need to be examined in some depth in Committee, not least the role of the Secretary of State and the powers of direction.

We may need to look at the Bill’s compatibility with international law, but I cannot agree with those already consulted who say that we should await international decision-making or that we should legislate for all nine points at the same time before proceeding with this Bill. I also do not think that it is inappropriate to co-opt harbour authorities into the regulation and enforcement of seafarers’ wages. They may have no experience of doing so, but they have experience of a wide range of health and safety regulations, for example. I accept that there may be difficulties with publishing surcharges in advance, but there may not be many cases of this in reality.

Much of the practical implementation of this Bill will lie in secondary legislation. I hope that the Summer Recess will be used to draft that secondary legislation, so that we have copies of the draft guidance and other general secondary legislation when we return for consideration in Committee. I would be grateful for the Minister’s confirmation that this will be possible and is indeed the plan.

Photo of Lord Howard of Lympne Lord Howard of Lympne Conservative 4:56 pm, 20th July 2022

My Lords, I begin by discussing the Bill. For 27 years, I had the great privilege of representing in the other place the constituency of Folkestone and Hythe. That constituency contains many seafarers, many of whom suffered grievously from the deplorable action of P&O. I very much hope that the provisions in the Bill will ensure that action of that kind is not repeated, and I very much welcome its provisions.

The main reason for my brief intervention in your Lordships’ debate this afternoon is to pay tribute to my noble and learned friend Lord Mackay of Clashfern. I had the privilege of serving with him in Cabinet. My noble friend Lord Strathclyde has described his presence, quoting Lord Howe of Aberavon, as a “looming presence” —although that is not quite my recollection. His interventions were always calm and judicious and, as your Lordships would expect, they were always listened to and heeded with respect.

When I entered your Lordships’ House, I watched my noble and learned friend’s contributions to your Lordships’ deliberations with admiration and awe. Not only did he frequently intervene in and influence your Lordships’ debates but he very often shaped those debates, and so often his contribution was decisive in the outcome of those debates and the votes which followed them. No greater tribute can be paid to a Member of your Lordships’ House than to say that. It can be said of perhaps no other. Your Lordships’ House will be much diminished by the absence of my noble and learned friend, and I speak for all of us when I wish him and Lady Mackay a long and happy retirement.

Photo of Lord Mountevans Lord Mountevans Crossbench 4:59 pm, 20th July 2022

My Lords, sadly, I am not someone who can really do justice to the important matter being discussed, the departure of our greatly esteemed colleague the noble and learned Lord, Lord Mackay. However, the noble Lord, Lord Howard, was talking about his very important and on-the-money comments and perceptions, which I have savoured and witnessed; so often they have absolutely gone to the heart of what we have been discussing. I join in regret and, at the same time, massive appreciation of all that the noble and learned Lord contributed.

I turn to the Bill. At the outset, I should say that in the past when I have spoken on maritime matters, I have very often had to declare an interest. I do not have a relevant interest at all now from trade associations and so on—only approaching 50 years of working in the industry.

I thank the Minister very much because, when she offered Members of the House a briefing a few days ago, I was unable to attend. She very kindly came straight back to me and offered to arrange a briefing with officials, which morphed into a briefing with her colleague the Shipping Minister. I am deeply grateful to her and to her colleague. Both of them have constantly exhibited a great concern for the industry, and a desire to get it right. My discussion with the Shipping Minister yesterday was extremely helpful, and I very much share his direction of travel on the Bill.

The whole industry—I think that I can speak for it, notwithstanding what I have just said—absolutely understands the need to do something about this issue. We will not accept again behaviour of the type that we saw, and we are very much on board with the suggestion that seafarers be paid at minimum the national minimum wage. However, I have some concerns about the Bill, which could have unintended consequences and could damage the industry, consumers and our international standing.

First, the Bill proposes a national regime for seafarers that would duplicate and contradict the obligations for seafarers set out in long-established international conventions. This represents a departure from the established international order, where the flag state holds primacy and, with this, full observance and compliance with international rules and systems. There is a concern that this could attract international condemnation from the IMO and other flag states. We should be very careful before doing anything that would antagonise the IMO, given that we are extremely lucky to have it based here in the UK. It is the only United Nations agency based here, and is of great value in terms of our maritime presence and offer.

Secondly, we should be very careful to avoid damaging brand Britain in maritime affairs. The shipping world uses services provided from London and the UK market; the leading shipbrokers in the world are largely British; marine insurance and associated services are massive from London; our brilliant law firms often handle a wide range of disputes from around the world; and so on. There is deep trust in Britain’s maritime offer and performance, and we must not damage the prospects of growing the UK flag. I am talking about a position whereby we could upset the international order by moving from these conventions, which work very well. What about our neighbours? How do they see this? The Netherlands, France, Germany, Spain and Norway will work with the existing conventions; they do not feel the need to bring something new in.

As drafted, the scope of the Bill is very wide, covering not only the ferry sector but all other services, if any vessel makes more than 120 port calls in a year—on average one call every three days. The precise impact is not yet known of this, but I suggest that it risks embracing more than just ferries; this is a Bill very much intended for ferries and the short-haul business. It risks that, which could damage consumers.

Thirdly—this has been mentioned, and the Minister knows it—the ports are unhappy with the prospect of an onerous burden being placed on them. They feel that they are not in possession of all the information; when a ship owner comes and presents an explanation of how they operate things, they do not feel well placed to evaluate that. Concern about this is very widespread in that sector.

Fourthly, it is debatable whether the Bill as drafted will have a meaningful positive effect on the terms and conditions of our seafarers. From my research, almost none of the seafarers employed on ferry routes is paid below the UK national minimum wage. I was unable to identify any, and I have tried very hard. There could be some cleaners and things like that, and I understand that we want to be super-vigilant on this—but with the seafarers I do not think that it is a problem. Indeed, the narrative in the immediate aftermath of the extraordinary action taken by P&O Ferries was about rostering manning levels and wider terms and conditions, rather than the national minimum wage.

This is a highly nuanced issue and I understand that with the Bill the Government are working on a framework agreement with owners. I also understand that the owning community is far advanced in its work on the framework. A suitably agreed framework could address all the Government’s concerns without statutory intervention, with all the attendant risks that I have listed and I hope we will hear about from others too. Such a light-touch solution would be very much in line with how we in the UK have dealt with many issues down the years. I am greatly reassured by the Minister’s opening remarks again and the assurances that she has given us that she will work in close co-operation with the industry and will listen very carefully. I am absolutely convinced and do not doubt for a minute that that is the intention of the department and Ministers on this.

Photo of Lord Fairfax of Cameron Lord Fairfax of Cameron Conservative 5:06 pm, 20th July 2022

My Lords, I first declare an interest: apart from working in shipping for 40 years and being a director of one of the ship owners’ P&I clubs, I am currently a non-executive director at a green tech fuel additives company which has relevance to shipping.

Today, of course, as many of the earlier speakers have said, is first about the valedictory speech in this House of my noble and learned friend Lord Mackay. I think I was one of those very few who were here—I think it was said—43 years ago on my first-iteration outing in this place. It was my pleasure and honour to have my hand shaken him as Lord Chancellor when I took the oath all those years ago. As noble Lords have heard today, there are very many greatly deserved plaudits from all sides of this House for his incredible long record of service with distinction.

I turn to the Bill itself. Following the P&O Ferries incident in March this year involving its peremptory sacking of—I think—786 staff, of course it is right that the Government should address the issues coming out of that. As noble Lords have heard, one of the main strange things about this is that, despite its name, P&O Ferries does not have its vessels flagged in the UK. If you were a member of the British public reading about this incident, as I was, and someone in fact who, as I say, worked for a long time in shipping, I immediately assumed that not only were the relevant staff British nationals but the vessels were probably flagged under the UK register. As noble Lords have heard, that is not the case: it is Cyprus, the Bahamas and Bermuda—so-called flags of convenience. There is nothing wrong with that. This is a totally widespread practice in international shipping, but it is perhaps not what was first thought.

Against that background, the Government have brought forward the Bill and, in general, I support what it is trying to do. But I would like to highlight three issues that come out of it. First—I think the previous speaker, the noble Lord, Lord Mountevans, touched on this—there is the extraterritorial nature of the Bill’s provisions. In particular, there is a suggestion that they may conflict with the United Nations Convention on the Law of the Sea, and I believe there is a similar submission by the UK Chamber of Shipping.

This leads on to my second question, which I asked the Minister about during the briefing last week. What do other countries involved in some of these frequent ferry services think about what we are doing? I think of France, for example. I live on the Isle of Wight, where we see Brittany Ferries coming in just about every day, as well as Condor and others. What does France think? And what do Germany, Holland and Ireland think? What are they doing to address this type of concern? I note that there is a reference in the briefing to the idea of “minimum wage corridors”, which may be the solution.

Finally, this is really repetition of a point that I have made already, but this Bill will in fact catch not UK flag vessels but foreign flag vessels. The nationality of the seafarers involved is irrelevant. I originally thought that the nexus would be that they were British, but that is not the case; this will catch foreign flag vessels. To take the case of Brittany Ferries, they are presumably French citizens. I am not sure, but I have a feeling that this is not what the British public first thought when they heard of the P&O Ferries case.

Photo of Lord Mann Lord Mann Non-affiliated 5:11 pm, 20th July 2022

My Lords, I think that when they heard of the P&O Ferries case, the British public’s first thought was one of contempt towards an employer who would deal with employees, our fellow citizens and our country in such a contemptuous way.

I start by paying tribute to a most important group within our country: the railway signallers of the west coast of Scotland. They are clearly capable of bringing up and nurturing the most talented of children who end up as the most distinguished Members of this House. Another such railway signaller from the west of Scotland is relevant to this particular Bill. When the national minimum wage came in, a former railway signaller, Mr Jimmy Knapp, was the leader of the seafarers’ union, it having merged into the railway workers’ union and his predecessor from the National Union of Seamen, Sam McCluskie, sadly having had a rather early and unfortunate death.

I recall the discussions. Mr Knapp was the most robust of west-coast Scots; he was clear, lucid and determined. There was never any indication or feeling that the agreements in place with the employers covering the ferries—which he specifically raised—would end up finding a way of outwitting that legislation. That was not the intent of Parliament at the time. If it had been the intent, Mr Knapp would have been very forthright in advising on how Parliament could have improved that legislation.

Times have changed, however, and globalisation has taken hold. Although the specifics of this Bill relate to maritime law, not to EU law, we have had the backdrop of the Laval and Viking cases in 2007 in the European Court of Justice, which significantly opened up the options and possibilities of shifting workers from one part of the world to another part of the world, and into this country.

There is no question whatever, from my experience, that that shift was a key motivating factor in the 2016 referendum for many working-class people. They saw that this imposition of rules and cheaper wages from abroad was not in the British national interest. So, I congratulate the Government on bringing forward this proposal—it is in the British national interest. I hope they will go further and look now at the Laval and Viking cases, because there will be future such episodes and it is fundamentally wrong that British workers’ pay and conditions should be undermined by people bringing in a cheaper workforce from abroad. That is not what anyone voted for in that referendum and it is not what people would vote for as an offer at any future general election—I put that to all parties in the House.

Secondly, what cognisance has been taken of the Fleet Maritime Services (Bermuda) judgment of 2015 on peripatetic seafarers and pensions? That judgment, which was a positive judgment in terms of pension rights, seems to totally complement what the Government are doing here. If the Government were to veer away from it, it may actually create some kind of precedent that could be used to challenge any demurral from seeing through this change, which, again, I commend the Government for bringing forward.

Photo of Lord Balfe Lord Balfe Conservative 5:16 pm, 20th July 2022

My Lords, I add my words of appreciation for my noble and learned friend Lord Mackay. I am a fairly new Member of this House, of only nine years, but he has been a constant presence throughout those nine years and always a source of wisdom. Whenever he gets up, he says something that is worth listening to. That cannot be said of many people, probably including me. We all wish him well in his retirement and he will be missed. That is often said about people, but it is certainly true of my noble and learned friend.

I welcome the Bill. It presents a very interesting contrast with the debate that we held the other night on a couple of nonsensical statutory instruments. It is a response to an action by employers that was just not acceptable, and this is exactly the right one. We need to get the Government behind good employment practice. I am not saying that the Bill is perfect, but I am saying that the driving force behind it is what I like to see when Governments deal with trade unions. As I have often said, I am president of the airline pilots union. The laws of the air are somehow a lot stronger than those of the sea, probably because aircraft are very expensive things and aeroplane technicians tend to talk to each other much more and get things organised. The Bill, I believe, is the product of a Government who have shown they care.

Clearly, we have to look at foreign workers, but I do not look at foreign workers, I look at workers—who are working to increase the prosperity of this country. My family were foreign workers; they all came from Ireland. They spent years contributing to the tax base of this country through working in this country—in the case of my father, working in the National Health Service. I have never looked at people and said, “Oh, they are foreign; they are not British, they deserve something different”. They do not: all workers deserve the same level of respect, and I am sure this Bill will carry that through. It is a way to deal with the problems and it shows what can be done.

I will make one mention of the briefing we got from the British Ports Association, which says that it is inappropriate to co-opt harbour authorities into the regulation or enforcement of port users’ employment practices. I happen to disagree, but if the Minister tends to agree, let me give her a very easy solution. We have a precedent in the certification officer for trade unions, who certifies all the trade union practices in legislation. Let us have a certification officer for port workers and let the port owners pay the levy to finance it. It is quite simple. If they do not want to do that, we can provide an alternative; the Government can provide a certification officer to ensure that these regulations, when they are passed, are implemented. Let us see what the port authorities have to say about that. It is the best way forward and would work things out.

I close by thanking the Minister and her department for the draft. I am sure it will achieve a small amount of debate in Committee but, when I read it, I thought, “At last we have something that reflects the attitude to trade unionism that I have always wanted to see from these Benches”.

Photo of Lord Berkeley Lord Berkeley Labour 5:21 pm, 20th July 2022

My Lords, I will speak briefly in the gap. I declare an interest as honorary president of the United Kingdom Maritime Pilots’ Association and a former harbour commissioner of the port of Fowey in Cornwall.

I am a young boy here compared with the noble and learned Lord, but we had something in common about 15 years ago when there was a problem with lighthouses around the UK. Ships going into UK ports fund those lighthouses and we found that ships going into UK ports were also funding the Irish lights, nearly 100 years after independence. It took a great deal of effort from Ministers of both parties to get the Irish to accept that they should fund their own lighthouses from the revenue from ships going into Irish ports. Of course, lifeboats are a completely different matter, but it was a useful bit of work done by the lighthouse authorities.

I certainly support this Bill. A briefing came to me from the RMT, which calculated that P&O’s labour costs had been reduced by 30% as a result of what it did. That does not bode well for the poor people who used to work for it. Worse still, it could set a precedent for other competing ferries to do the same thing. It is all to do with the changes brought by Brexit, but we are where we are. I have a few questions, which I am sure will come up again in Committee, but I welcome the Bill, which is a good start.

On this business of 120 days, with the ferries that go to Spain from the UK, it is probably not the same ship all the way through the year—sometimes they go only in summer. Can the Minister say how their visits would be counted and qualified?

There are also the freight ships that go across—most are ro-ro, but not all—between the UK and the near continent, although I see that freight is included, which is really good. However, why are cruise ships left out? Some cruise ships just go around the UK, probably because of the Covid regulations of the last few years. Surely, the people who work on them deserve the same protection as those who operate the ferries, at whom this Bill is directed. Also, what about the deep sea ships, the deep sea containers and bulk carriers—which, as the noble Lord, Lord Balfe, reminded us, we talked about the other day?

They all have people working on them who, surely, if they are operating in UK waters, deserve the same protections. If people start saying that ship owners cannot afford to pay their crews decent wages, noble Lords might like to refer to an article in the Sunday Times last week which showed that the shipping industry made a net profit of £188 billion last year—so they can probably afford to pay their seafarers a decent wage and let them see some of the benefit.

There is also the question of the offshore oil sector and the boats that support it. So there are many questions there. I am not going to go on because I think I have reached my time limit, but I give notice that I shall have a number of amendments to put down in Committee. I think we need to talk in particular about the role of the ports, as several noble Lords have said.

Photo of Baroness Scott of Needham Market Baroness Scott of Needham Market Liberal Democrat 5:25 pm, 20th July 2022

My Lords, I have no current interests to declare, but for context I will tell the House that I served for six years as a non-exec on the Harwich Haven Authority, which serves the port of Felixstowe. Before that, I was the first woman to serve on the board of Lloyd’s Register—so I take a great interest in these issues.

It often strikes me that in this island nation, which is totally dependent on goods coming in by sea and has a first-class maritime sector, we very rarely debate maritime issues in this House and in Parliament generally, and we even more rarely have associated legislation. I think it is probably because things work pretty well on the whole. But it is also because there is complex, well-established governance emanating from international organisations and agreements—the noble Lord, Lord Mountevans, mentioned the IMO just across the river. It is a reminder that sharing sovereignty is sometimes a necessary and positive thing, and that we need to exercise some caution.

It is welcome to have legislation and a debate this evening, particularly because it has occasioned the valedictory speech of the noble and learned Lord, Lord Mackay of Clashfern, who is retiring. In a House noted for its long service, being an active Member in your mid-90s is quite some achievement, but to still be making incisive legal contributions and wise judgments above all in a way that is entirely unconfrontational is a real lesson to those who think that shouting and being unpleasant is how to get what you want. I am sure everyone who has ever listened to the noble and learned Lord has learned from him, so I thank him very much and we on these Benches wish him well.

From these Benches we fully support offering seafarers all the protection we can reasonably give. Many of them work in very trying conditions and are often exploited. The situation at the start of the pandemic, and for quite some time, was horrendous. Many were trapped at sea for months, unable to get home after their contracts had ended, and their replacements were unable to get out to relieve them. The Government’s nine-point plan is extremely welcome, and we look forward to hearing how the Government are progressing with it, and in particular with those elements that require the sorts of bilateral agreements to which the noble Lord, Lord Fairfax of Cameron, referred, such as the minimum wage corridors. I wonder whether the Minister can say whether there are plans to keep Parliament updated routinely, or whether perhaps we need to table some debates. I think the Bill is the only part of the plan that requires primary legislation.

It has come about because of the egregious behaviour of P&O Ferries, which shone a spotlight on the condition of the industry and provided the impetus for some new thinking. But it is worth reminding ourselves that the company was breaking existing law; that is clear. The law was already there, so the idea that new law is of itself a panacea is something we should resist.

I am slightly suspicious about legislation brought in to address one particular set of circumstances. I can hear the Yorkshire tones of my late noble friend Lord Shutt of Greetland saying, “You don’t make porridge for one”, and I am a bit nervous that here we are making porridge for one, because it is one set of circumstances. For me, the starting point is always, “Is there some way of doing this other than legislation?” I think these international agreements and corridors might end up being more fruitful, but Governments of all colours reach for the statute book first, I think because if you have a hammer, all problems look like a nail.

The Bill is actually quite limited in scope. In practical terms, it will cover mainly ferry companies on short strait crossings, although the noble Lord, Lord Berkeley, brought up some other interesting examples. We will need other measures to protect everyone else, and that will mostly be a matter for the international maritime organisations.

I know that at the start of this process the Government’s thinking was very much about putting the burden of enforcement on to the port authorities, and I am glad that they have listened to the strong objections from the sector about taking on a new, onerous regulatory role. There is already minimum wage expertise in government in the form of HMRC. The legislation puts more of the burden on to the Secretary of State, which in operational terms means the Maritime and Coastguard Agency, which will now take on most of the responsibility for compliance, the setting of surcharges and so on. Can the Minister say a little about the resources available to the MCA, particularly in the context of all government departments being asked to reduce staffing numbers by somewhere between 20% and 40%? It might be quite difficult to take on new responsibilities with fewer people.

I know that the Government believe that this a modest extra burden on ports, and I think it is possible to overstate it, but it will largely depend on the systems that we set up for running the system. I hope that great care is taken to ensure that for operators, ports and the MCA alike the systems are streamlined and as efficient as possible. I fully agree with my noble friend Lord Shipley that we need sight of the guidance first, because there are some new responsibilities. In Clause 7, for example, a process is set out which could be quite time-consuming for a port authority. Noble Lords need to have a little sympathy with a sector which has spent millions of pounds preparing for post-Brexit checks that will now never take place.

The surcharges will be established by secondary legislation, imposed by the MCA and levied by port authorities, so we need full consultation with all parts of the sector. In particular, we need clarity and transparency. Those principles are always a good idea, but given that some port operators also own the ferries, they are particularly important here.

I have a couple of questions for the noble Baroness. First, if the MCA finds a breach which results in a levy, does the port authority have to collect it? What happens if it chooses not to? Secondly, some aspects of the legislation can result in summary conviction and fine—for example, in Clause 5. Can the Minister say against whom these criminal charges would be brought? Would it be the master, the owner or the board of the company? Finally, we come to what for me is the most important question of all. The intention is that, where a surcharge is not paid, the Secretary of State can direct a port to refuse entry. On the face of it, this could be a direct contravention of the open port duty as defined in the United Nations Convention on the Law of the Sea, to which the UK is a signatory. Can the noble Baroness set out what legal advice has been sought and from whom, and whether it can be published, to establish that barring a vessel from a port does not in any way conflict with our international obligations under UNCLOS?

Photo of Lord Tunnicliffe Lord Tunnicliffe Shadow Spokesperson (Defence), Shadow Spokesperson (Treasury), Shadow Minister (Transport) 5:33 pm, 20th July 2022

My Lords, I thank all noble Lords who have spoken today, but I particularly thank the noble and learned Lord, Lord Mackay, for his contribution. I cannot match the eloquence of previous speakers, but I formally—for want of a better way of putting it—thank him on behalf of these Benches for his magnificent contribution over those 43 years. At a personal level, it has always been a pleasure to listen to his interventions, not just for his tone and style but for his wisdom. It is the sort of wisdom that melds both logic and personal values. In particular, we feel that his view of the world is to try to be more conciliatory. That is an important element in our deliberations. Too often, we lose that sense of trying to work for a common solution, and one always sees his interventions as trying to find out what someone really means and asking if there is some common ground. It is as if he had a personal ambition to make this House a better place for all of us to work. I thank him personally and on behalf of these Benches.

These Benches support the Seafarers’ Wages Bill, which we hope will mean that more workers calling at UK ports earn the equivalent of minimum wage. However, I am afraid that, in the aftermath of the P&O Ferries scandal, this will not be enough to give seafarers the security which they deserve at work. Seafarers kept this country stocked throughout the pandemic, but loopholes in the Bill will mean that many still will not receive a fair wage, and other key issues such as pensions and roster patterns are not even addressed. For this reason, we will seek to amend the Bill to give seafarers greater security at work, crack down on rogue employers and make sure that the P&O Ferries scandal can never happen again.

I turn first to the vessels which are in scope of the Bill. As drafted, vessels docking at UK ports must pay the equivalent of national minimum wage for the time spent in UK waters, but Clause 3 states that this will apply only to ships which

“entered the harbour on at least 120 occasions in the year.”

While most services will be covered by this, for some routes, such as that of the “Pride of Hull”, only slight adjustments to the timetable would allow them to escape paying a fair wage. The Government’s own impact assessment shows that the department considered applying the legislation to ships which dock on 52 occasions a year. Can the Minister explain why they have not pursued this option?

It is also not apparent why the Bill refers to “the harbour” rather than “a harbour”. This could open a loophole for vessels to dock at different ports to escape paying a fair wage. Has the Minister considered that possibility?

On the wages which seafarers will receive, it is disappointing that the passage of the Bill will not mean that a worker’s full wages will equate to the minimum wage. While the Bill states that seafarers must receive the equivalent of national minimum wage for the time spent in UK waters, workers could end up receiving far less than the national minimum wage in total because many European nations have no minimum wage. For example, in the hypothetical situation where a seafarer works for four hours in UK waters, on a national minimum wage of £9.50, and four hours in Danish waters, with no national minimum wage at all, in total the worker would receive an average of £4.25—half of the UK national minimum wage. While I appreciate that the Government are seeking bilateral memorandums of understanding to address this, the uncertainty in government could mean that policies such as these are abandoned. Can the Minister commit to pursuing such agreements in the Bill?

I am also disappointed at the narrow scope of the Bill and the lack of broader protections for seafarers. Despite initially being referred to as a harbours Bill, the Government have stripped back the Bill to focus on the narrow issue of wages, leaving out references to a seafarers’ framework, as well as other commitments from the nine-point plan. While I appreciate that secondary legislation will be introduced to enact other aspects of the framework, Ministers should place guarantees in the Bill, including in relation to pensions, roster patterns and collective bargaining. Will the Minister explain why the Bill is no longer a broader harbours Bill?

On the matter of enforcement and penalties, the P&O Ferries scandal should represent a line in the sand for seafarers’ rights. However, we cannot ignore the fact that bosses ignored existing protections because the fines were too weak. It seems that firms such as P&O are willing to look at fines as a mere cost of existing.

Although we support the inclusion of unlimited fines in the Bill, the lack of a minimum fine raises the prospect that precedents could be set for smaller penalties. Ministers should strengthen the penalties in the Bill to make sure that rogue employers can never again get away with flouting seafarer protection. Will the Minister explain the Government’s position on minimum fines?

Given that the Bill also allows harbour authorities to monitor compliance, as many authorities are also operators, this could end with employers marking their own homework. Will the Minister consider safeguards to protect this system from abuse?

Turning next to the regulatory powers, the Bill allows the Secretary of State to change which services this wage protection applies to. Although we would support the expansion of protections to more workers, there is a risk that these powers could be used to exclude workers. Can the Minister today commit to a principle of non-regression of seafarers’ rights?

Next, on the provisions which mean that harbour authorities will have the power to refuse harbour access in response to non-compliance, the Government must mitigate any risks and ensure that access is never refused when it is necessary for the safety of the crew. Although I am pleased that the Bill contains provisions for when authorities cannot refuse access, can the Minister confirm that this is in full accordance with international maritime law?

Finally, as we consider the implementation and application of the Bill, Ministers should consider the role that trade unions can play as experts in the safety and conditions of seafarers. The current situation means that P&O, Seatruck, Irish Ferries, Condor Ferries and Cobelfret are all still using the low-cost crewing model which P&O imposed on 17 March. As a result, ratings are often receiving below the national minimum wage pay and long contracts that cause fatigue.

The P&O scandal must represent a line in the sand for seafarers’ rights, but in its current state, the Bill falls far short of achieving that.

Photo of Lord Hacking Lord Hacking Labour

Before my noble friend sits down, I should be grateful if I could intervene for a moment to apologise to the House, most particularly the Minister and the noble and learned Lord, Lord Mackay, for my absence during the past hour. I had a commitment with the Lord Speaker that neither he nor I could change, but I apologise for not being here. I am greatly sorry to have missed a number of the speeches that your Lordships gave in my absence.

Photo of Baroness Vere of Norbiton Baroness Vere of Norbiton Parliamentary Under-Secretary (Department for Transport) 5:42 pm, 20th July 2022

My Lords, the Bill is clearly not the star of the show today. We have heard so many wonderfully warm words, and I was touched by so many of them, not only from my noble and learned friend Lord Mackay but from all noble Lords who paid him tribute. But I must at least try to get the House back to focus on the Bill, and that is what I intend to do.

I am very grateful to all noble Lords for their contributions and, as ever, I feel a letter coming on. We will try to get it out as soon as we can. I do not know that it will be before recess, but perhaps by the end of next week. I will try valiantly to answer as many of the questions raised as possible. I know that we will be heading into Committee on the Bill on, I think, 5 September, so it will be upon us before we know it. Thinking about it over the recess might be a very wise idea.

I cannot agree with the noble Lord, Lord Tunnicliffe, that the Bill is too narrow. We must balance that with the statement of the noble Baroness, Lady Scott, who said, “Oh, the Government are always reaching for legislation”. That is what we are trying not to do in this case; we are reaching for this legislation because it is necessary and fills a gap, but many of the other things we will be delivering in our nine-point plan do not need legislation, so we will not put them in legislation. Noble Lords know that we are overwhelmed with legislation; do not even get me on to secondary legislation, which we must also make sure is completely fit for purpose so that we do not end up overregulating and having too many debates on things that, frankly, do not need legislating. I am content with the scope of the Bill and the extent to which it applies.

There is always that very interesting balance in maritime between the Government being very focused on domestic priorities, for the protection of domestic workers operating with very close ties to the UK, and what is an extremely international market for maritime but which is governed by international laws, conventions, agreements, all sorts of things that make up the maritime ecosystem. We are very clear that we do not want to be upsetting that ecosystem and we are content that this Bill does not do that. We are also very clear when it comes to, for example, access to ports in an emergency or for the welfare of the people on board, a vessel would never be barred from entering a port in such circumstances. Therefore, I am content that this reaches that appropriate balance between the domestic priorities and the broader maritime framework, which is set mostly internationally.

The noble Lord, Lord Tunnicliffe, asked why there was no longer a harbours Bill. There was a name change. It is nothing more significant than that. I was expecting something called a “harbours something-or-other”, but there was a name change and, lo and behold, we are calling it something which much better reflects the intention, since our target is the seafarers, not the harbours. We are all after the people, and therefore it was quite right that we changed the name.

I think that I have covered the issues raised by the noble Lord, Lord Mountevans, as well. I take his point, and he is hugely experienced regarding our international reputation. As we have set out in our nine-point plan, we will be working with international partners. We will not be putting this in the Bill because it is not within our gift to deliver it. That does not mean that we will not work extremely hard; at the moment we are engaging with eight European countries on seafarers protections and welfare more generally, and to explore the creation of the minimum wage equivalent corridors. I do not say that this will necessarily be easy, but there are many like-minded seafaring nations which would want to see certain agreements being reached. Discussions are currently at an early stage, but we are pursuing them as a matter of priority.

A number of noble Lords mentioned the conflict that might exist between ports’ commercial interests and their statutory duties. We are clear that we must be cognizant of that but also, because the Secretary of State has the power to issue directions, it is the case that in the event of any doubt that those two things were not being performed correctly, I am afraid that the MCA and probably the Secretary of State would have things to say. However, I must reiterate that when it comes to the ports, we do not really want them to do very much at all. By the time that we have passed the secondary legislation for the declarations, the declarations will be standard, they will have been consulted on, and we will have discussed them with the various stakeholders, so it will be a very transactional relationship. They have a transactional relationship with visiting vessels already, so it is just one more cog in that particular transactional relationship.

Therefore, the ports will not be performing any sort of enforcement function at all. I note the comments from my noble friend Lord Balfe but, as I said, we are quite clear on what we want the ports to do. I look forward to talking through the secondary legislation when we discuss the process in more detail. If we get the secondary legislation right, if the process is really effective, then the role of ports will be minimised.

The noble Baroness, Lady Bakewell, asked about the term “non-qualifying seafarers”. This is going to get a little complicated, because we are trying to capture non-qualifying seafarers; they do not qualify for the national minimum wage and we want to make them qualify for the equivalent, which we are setting up. We want all workers on vessels with close links to the UK to be covered. I reassure the noble Lord, Lord Tunnicliffe, that we are focused on improving the rights of seafarers, both in the UK and by working with international structures.

The noble Lord, Lord Mann, mentioned some quite broad elements around workers’ rights and pay and conditions. The Bill seeks to amend the law in a limited and specific way. I will come back to this again and again in Committee: it is about workers with close ties to the UK, in UK waters. That is our focus in getting the Bill through Parliament. He mentioned a Bermuda judgment on pensions, but he is testing my knowledge so I will have to write on that matter.

I sense that we may have some discussions in Committee on the question of services as well. We considered all sorts of different frequency definitions, various types of vessel and the sorts of services they offer. It all got bogged down very quickly and could have ended up causing significant distortions to the market, as people try to change what their vessel does to fit into a different category. We do not want that; we are after simplicity here. We really are.

We decided on 120 days, which is equivalent to once every 72 hours, because we felt it was the right balance between workers on board having a close tie to the UK—I will come back to that a lot—and capturing as many of the vessels that we want to capture. We have analysed past data, which suggest that a large majority of ferry services would be captured in this scope. DfT statistics suggest that, had the policy been in effect in 2019, approximately 98% of passenger ferry voyages would have been captured and 70% of non-passenger ferry voyages carrying freight would have been in scope. Very few bulk, container and other such services would have fallen in scope—for example, for 1999, 7% of fully cellular container voyages to and from UK ports and a tiny proportion of the dry/liquid bulk services would have been in scope. I think we have the right balance.

The noble Lord, Lord Berkeley, mentioned cruises. If it is a UK cruise that stays in UK waters, it will be paying the minimum wage, because that is already in the regulations. However, if the cruise ship is going far away, it will not be covered, because it does not have close ties to the UK, is not back and forth or visiting our shores very frequently. That is the distinction we have made.

Photo of Lord Berkeley Lord Berkeley Labour

I am very grateful for the noble Baroness’s comments. She spoke about ships that do not have close ties to the UK, but we are talking about workers on those ships and whether they have close ties. It would be helpful if she could define that now or in writing.

Photo of Baroness Vere of Norbiton Baroness Vere of Norbiton Parliamentary Under-Secretary (Department for Transport)

Is it not really about the service? We cannot legislate for UK workers working in international waters or in any country in the world. That is what we must balance here. If we wanted to include cruises, we would have to include every vessel that pops into UK waters. The administration of that would blow up; it is not going to work. We will debate this in Committee, but I think we have reached the right balance. I do not know that noble Lords will be able to convince me that we have not, but I am willing to let them try.

I turn briefly to enforcement, which is a really important point. This is where the MCA will step up to enforce the system as a whole. We expect the cost of enforcement to be about £359,000 over 10 years. That is a relatively small amount in the context of the work of the MCA, because it can be done alongside its many other inspections.

The framework around the surcharges will be set out in secondary legislation. The noble Baroness, Lady Bakewell, was concerned about the ports setting the surcharge, but they will not. If a port for whatever reason had a ship approach and thought, “That’s a friendly ship; we’re not going to charge it a surcharge”, the Secretary of State could direct it to charge the surcharge. That gets round the issue where you might have a port and a ferry service operated by the same operator. The Secretary of State’s beady eye will be there to make sure that it does as it should.

I will come to the point made by the noble Lord, Lord Tunnicliffe, about minimum fines. The noble Lord, Lord Shipley, raised a point about a port being an enforcement authority; it definitely is not going to be. The noble Baroness, Lady Scott, asked about criminal charges. It will be for the ship operator, which is standard for maritime, to suffer any penalties relating to the Bill.

I am going to finish off with my favourite topic—secondary legislation. I think someone said “good”; I am not sure who it was. I am really offended, but I am going to talk about secondary legislation just so we can suffer a little longer. This is important because I have noted that Grand Committee is on 15 September, and we will not have full draft regulations by then. I am sort of thinking that this is probably not the worst idea in the world. We will have detailed policy notes, but as we go through Committee and debate the sorts of things we are proposing to put into secondary legislation, I think having detailed policy notes will be sufficient to aid our thinking, and issues may certainly come up in the discussion that we may want to reflect in the regulations or perhaps draft the regulations in a slightly different way.

I believe I have covered some of the questions asked by noble Lords today.

Bill read a second time and committed to a Grand Committee.