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.