Wreck Removal Convention Bill
(13 years, 5 months ago)
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Baroness Stowell of Beeston
My Lords, before I get to the contents of the Wreck Removal Convention Bill, I declare that, unlike other noble Lords scheduled to speak today, I am not a shipping expert. Indeed, that was the first thing I said to my honourable friend the Member for Suffolk Coastal, Dr Therese Coffey, when she asked me to steer the Bill through your Lordships’ House after she had, very ably and successfully, steered it through another place. However, after reading the Bill it was clear to me that I did not need to be a shipping expert to understand why it was important and why I should agree to Dr Coffey’s request. In short, what jumped out at me from this Bill and the international convention it seeks to ratify is that it will remove an unfair burden on the British taxpayer and put liability in its rightful place.
Over the past few weeks, although I have improved my knowledge of shipping—not least because of many informative and enjoyable discussions with some of your Lordships—I remain a novice. However, I am a novice full of admiration and respect for all those who work in the UK shipping industry and in all the agencies responsible for maintaining and protecting our harbours and coastal waters. Therefore, it is my great pleasure and privilege to introduce the Bill.
Your Lordships will be pleased to hear that the Wreck Removal Convention Bill is relatively short and consists of just two clauses. The United Kingdom, which is surrounded by some of the world’s busiest shipping lanes, is particularly vulnerable to the consequences of maritime casualties. Thankfully, such instances are rare. However, we can never be complacent. In this Bill we have an opportunity to implement the International Maritime Organisation’s International Convention on the Removal of Wrecks. This international convention would build on the well developed arrangements that already exist for dealing with these incidents, on the part not only of the Maritime and Coastguard Agency but of the conservancy, harbour and general lighthouse authorities, which have responsibility for dealing with wrecks that are, or are likely to become, an obstruction or danger to navigation or lifeboats in service within their respective areas. It is anticipated that after enactment the provisions will be commenced by an order made to coincide with the entry into force of the convention, which will be 12 months following the date on which 10 states have ratified it. The Bill will not apply to historic wrecks—that is, any wreck that occurred before its entry into force.
A wreck, which may be a ship, part of a ship or something that was on board a ship, can cause a number of major problems. It may constitute a hazard to navigation, potentially endangering other vessels and their crew. It may also cause substantial damage to the marine and coastal environments, depending on what is in the ship or its cargo. Consequently, the costs associated with locating, marking and removing a wreck can be substantial. However, those costs can also be difficult to recover, particularly where a wreck has been abandoned by its owners, so inevitably the taxpayer and payers of light and harbour dues risk having to bear a significant proportion of these costs, which is totally inappropriate.
The Bill would address these issues by implementing the convention’s provisions in the United Kingdom, its territorial waters and an area equivalent to an exclusive economic zone that extends from its territorial waters up to 200 nautical miles from the shore. Most importantly, the Bill places the primary responsibility for the removal of a wreck that poses a hazard to navigation or the environment in this area on the ship owner. It would also provide the Secretary of State with the necessary powers to ensure that all reasonable steps are taken to locate and mark a wreck.
In doing so, the Secretary of State would have the discretion to direct conservancy, harbour and general lighthouse authorities to mark the wreck and to exercise or not their existing powers for dealing with the wreck. Crucially, it would also provide the Secretary of State with the necessary powers to intervene and remove the wreck if the owner does not do so expeditiously or at all. In doing so, he may act through the Maritime and Coastguard Agency or direct the appropriate general lighthouse authorities or harbour and conservancy authorities responsible for managing our ports to intervene. Although such authorities already have powers to deal with some wrecks in their existing areas, those powers lack a clear means of cost recovery. The use of the power of direction by the Secretary of State would bring the significant benefit of linking these authorities to the convention’s regime so that they can take full advantage of the cost recovery provisions—an important point.
These steps are to be welcomed. At present, the powers of these authorities are limited to their areas within territorial waters. Just as for the Secretary of State’s representative for salvage intervention, SOSREP, safety-related powers are limited to territorial waters. Only his powers in respect of pollution may be exercised in the larger pollution zone, but the Bill’s powers to locate, mark and remove wrecks and to recover the costs for that work will cover dangers to navigation and pollution all the way out to the edge of the UK zone. Under the Bill the ship owner would also be responsible for any costs associated with locating, marking and removing a wreck. This would include any preventive action that may have to be taken and any mitigation or elimination of any hazard caused by the wreck, including measures to prevent pollution emanating from the wreck. This liability would apply to all ships regardless of size. In addition, no ships of 300 gross tonnage and above would be required to maintain compulsory insurance for this liability, which would be enforced through a wreck removal insurance certification scheme.
The certificates, provided by the relevant authorities of a flag state, would provide evidence that insurance was in place and must be carried on board any ship of 300 gross tonnage and above entering or leaving a port or terminal in the United Kingdom so that they can be checked as part of the port state control procedures. Any ship found to be without the required insurance during these checks could be detained, and liability on the ship owner is strict. Therefore, if an incident has occurred that has led to the UK’s authorities incurring costs under the Bill’s regime, they will be able to recover these costs from the owner or directly from the insurer.
This right of direct action, which already exists in other maritime liability and compensation regimes, is intended to help claims to be settled more quickly. Similarly, the issue of a direction by the Secretary of State to the general lighthouse authorities and harbour and conservancy authorities to locate, mark and remove a wreck will establish the link to the procedures under the convention so that these bodies may benefit from the convention’s cost recovery provisions. All this would represent a marked improvement on the existing system because there is at present no mandatory mechanism allowing these costs to be recovered. Indeed, it greatly increases the probability of the state recovering most, if not all, of its costs where it has had to incur them in locating, marking or removing a wreck.
To conclude, SOSREP, the Maritime and Coastguard Agency and the general lighthouse authorities, along with those responsible for managing our harbours, will continue with their first-class work to prevent accidents. Of that, this novice has no doubt. But we also need to ensure that they are able to respond as effectively as possible to any problems that arise. This Bill will put them in the best possible position to do that and I commend it to the House. I beg to move.
Lord Boyd of Duncansby
My Lords, I congratulate the noble Baroness on having brought this Bill to the House and so ably explaining it to us. She said that she was a novice; I believe that Dr Coffey is also a novice. It is good to see the Bill being piloted through Parliament by two such excellent novice pilots. To keep on this bad metaphor, I doubt that we are going to have a parliamentary shipwreck.
This convention is a welcome development in the law of the sea. I am not a maritime lawyer so I have to confess at the beginning that I am indebted to an article by Richard Shaw, senior research fellow at the University of Southampton’s Institute of Maritime Law for some background on this convention. The evolution of it goes back to the wreck of the “Torrey Canyon” in March 1967. As many noble Lords will remember, it came to grief off the Scilly Isles outside the then territorial limit of 3 miles. It hit a submerged reef, the Seven Stones, discharging slowly 115,000 tonnes of crude oil. The question was: how did the United Kingdom then deal with it? Eventually, it was dealt with by high explosives being dropped on the wreck, followed by napalm to set the oil alight. There were questions of the efficacy of such a procedure and of the legality of dealing with a wreck outside the territorial waters.
That wreck led to the 1969 International Convention on Civil Liability for Oil Pollution Damage and an International Convention Relating to Intervention on the High Seas in Cases of Oil Pollution Casualties. Yet under these conventions, the ability of the coastal state to intervene when faced with a major oil spill outside its territorial limits was severely limited. The United Nations Convention on the Law of the Sea in 1982 created a new sea area, the exclusive economic zone, within which there are certain limited rights, including the protection of the marine environment under Article 56 but, crucially, not the safety of navigation. The need for this convention is illustrated by an incident in 1984, when the French ship “Mont-Louis” collided with a passenger ferry outside Zeebrugge and came to rest on a sandbar—again, outside the territorial limits. The Belgian authorities served a wreck removal order on the owners of the ship but it was unclear whether they actually had the jurisdiction to do that. Fortunately, the issue was settled amicably but it raised the real issue of how one deals with wrecks outside the territorial limits.
The convention follows three principles. First, there is a grant of rights to a coastal state to remove a wreck from its exclusive economic zone if it represents a hazard to safe navigation or to the marine environment. Secondly, there is strict liability on a ship owner for the cost of reporting, marking and removing a wreck if required to do so by a coastal state. The third principle is of compulsory insurance and, crucially in this respect, the ability to take direct action against the insurers or those giving financial security on the equivalent provisions in the 1969 convention.
I appreciate that there have been some concerns raised, in particular by the Chamber of Shipping, and I anticipate that some of those may be raised later in this debate. In evidence to the Transport Select Committee in the other place, the Chamber of Shipping, although it supported the convention, expressed reservations about the consequences for light-dues payers as a result of passing obligations on to the general lighthouse authorities. At this point, I suppose that I should mention an interest as a past commissioner of the Northern Lighthouse Board. I am sure that if this matter comes to Committee with amendments, we shall deal with those concerns in more detail at that time.
However, the question of where liability should rest is of course important. Should it be with the General Lighthouse Fund and thus the industry or with the Exchequer? At Third Reading in the other place, Dr Coffey referred to the “Lagik”, which was grounded off the River Nene in 2000. The result was that it closed the port of Wisbech for 44 days. She asked the other place, quite pertinently, to imagine the resulting disruption if that had been Felixstowe. Of course, there would have been consequences for UK trade but there are other ports to which some of the cargo could no doubt be diverted. The main impact, I suggest, would be on the industry and it is right that the taxpayer should not have to bear these responsibilities.
Yet it is also right that the impact on the industry should be minimised, so far as possible, which is done by two particular aspects of the Bill and the convention. The first, as we have heard, is for the compulsory insurance of all ships over 300 gross tonnage and the second is the provision to allow the state to claim for costs arising under the convention to be brought directly against the insurer, thus minimising any exposure to the General Lighthouse Fund. Both those aspects seem to me to be important elements. It is also important that the lighthouse authorities themselves believe that these provisions will in fact mean a diminution in the costs on the General Lighthouse Fund as a whole and therefore, in consequence, on light dues. Once again, I fully support the convention and look forward to debating the Bill further in this House.
Lord Bradshaw
My Lords, I shall turn to one aspect of this Bill, which I generally support: that of insurance and its efficacy in other transport modes as well as those on the sea. It is all very well saying that the costs will be borne by the insurers but how certain are we that those people have valid insurance certificates in force? Perhaps the Minister will tell us something about the port inspection procedures which verify whether a person has insurance and whether that insurance is adequate to cover the potential risks involved if the ship becomes a wreck. Of course, there is also the issue of ships which are not signatories to the convention, and which are passing through waters within our economic area but not calling at a harbour within the United Kingdom where such certificates can be inspected.
I said that I would touch on other modes. Rail companies are bound to have insurance—I believe a certificate of £155 million which is enforceable. However, we all know from recent questions in the other place that the car insurance industry is in a bit of mess. Although the police are able to detect cars without insurance and do that very easily with their camera equipment, there are a large proportion of motorists using the roads in this country who are not adequately insured—or insured at all.
My main point in contributing to this debate is to say that I support the Bill. It is not right that the Government shift their responsibilities to harbour authorities and the general lighthouse authorities, which have a limited sum of money available to deal with wrecks. They have a duty to mark them and so forth, but the recovery of a significant wreck will cost a lot of money. Knowing the insurance industry as I do, I can say that it will not be in any great hurry to come forward to meet its liabilities. There will therefore probably be a period of time between a wreck being located and marked and a Government issuing a direction to remove it, and any money being forthcoming to the harbour or lighthouse authority to which orders are given.
Despite the frequent representations of the noble Lord, Lord Berkeley, the lighthouse authorities do not have a bottomless pit of money into which they can dip. I hope that the Minister will say that, until the insurance claim is settled, the Government—the Treasury—will stand behind the authority which is removing the wreck and will pay the immediate bills that arise. Wrecks often have to be removed quickly. I look forward to further debates in Committee, but the House deserves some real reassurances from the Minister.
Lord Berkeley
My Lords, I am grateful to the noble Baroness, Lady Stowell, for introducing the Bill. My noble friend Lord Lea, who is no longer in his place, asked me whether it referred to maritime wrecks or Members of the House of Lords in a restructured Chamber. I hope I can put his mind at rest on that one.
I declare an interest as a harbour commissioner of the port of Fowey in Cornwall, and as president of the UK Maritime Pilots’ Association. I very much support the principles of the Bill. As the noble Baroness said in introducing it, we have got some really beautiful coastline in this country: more than 10,000 miles of it. The Bill will make a great difference to how wrecks are dealt with. We are also setting an excellent example to other states by implementing the international convention. I am pleased that the Government are urging other nations to ratify it; I believe it comes into force when there are 10 signatories. Perhaps the Minister, when he speaks, can tell us how many member states have ratified it and how discussions with them are going so that we can get some kind of a progress report.
My concern, as one or two previous speakers have said, lies with the burden that the Bill could impose on harbour and conservation authorities, the general lighthouse authorities and the General Lighthouse Fund; my noble and learned friend Lord Boyd particularly mentioned that. The noble Earl, Lord Attlee, will be aware of my interest in the GLAs and will be very pleased to hear that I am not going to talk about their finances today. The Chamber of Shipping’s view—again, mentioned by my noble and learned friend Lord Boyd—is that it is really unfair to have any liability placed on ships entering British ports because of the activities of a ship which may not be insured and may not even have called into a UK port. The shipping interests have got a point here.
My first problem concerns uninsured wrecks. The noble Lord, Lord Bradshaw, talked about that. Yes, the Bill says that the Government will be checking on the insurance of all ships coming into UK ports and will assist in reclaiming the costs of any rescue/salvage from the insurers. My problem is that there is a small possibility that the insurance may not be sufficient or may not be in place at all. That could particularly occur if a ship was in the widened territorial waters we are talking about but was not calling into a UK port where the insurance might get checked. There is not a high likelihood of that, but there is still a consequential fear that the GLAs, harbour authorities or others might be saddled with a high cost. As the noble Baroness said in her introduction, the problem is that the Bill allows the Secretary of State to “instruct” these authorities. It is an instruction; they cannot say “no”, as I understand it. They could turn around and say, “We haven’t got the capability”, or something like that, but they will be given an instruction. I am sure that the present Secretary of State and his Ministers would never do that, but you never know what is going to happen in the future. We ought to consider how we deal with this. We could perhaps consider it in Committee. If a ship sinks which is not going into a UK port, and is therefore not contributing even by paying its light dues, then this whole procedure does not really comply with the principle that the polluter pays. It means that the responsible ship owners are paying for the actions of the irresponsible ones. How would the GLAs recover the costs from these overseas owners or the insurers if they refuse to pay? The Government have said that they will do this, so possibly the answer would be for the Government to indemnify the GLAs or the harbour authorities against such a loss. I am sure that the Minister will be able to comment on that when he responds.
My second point concerns whether the GLAs and harbour authorities necessarily have the capability to carry out some of this work. The GLAs certainly have the capability of marking wrecks; that is one their objectives. They can probably remove small wrecks but that is really a salvage operation and I do not regard the GLAs as salvage contractors. They could probably undertake salvage operations but why should they have to pay for them as well? Why should not the Government organise the salvage themselves?
Several noble Lords have given examples of wrecks. Sadly, there are many around the coast, but an interesting situation arose in 2008 when the Government asked Trinity House to act as a salvage company to remove the wreck of a First World War German U-boat which was on the bed of the English Channel. The Government agreed with the German Government that they would not ask the latter to undertake this operation. Trinity House did it—I believe, successfully—and it cost £1.5 million, I am told. Ships coming into UK ports had to fund that. A sum of £1.5 million is not a high proportion of the GLAs’ turnover, but the cost could have been a lot higher if a different type of wreck had been involved. The Government should organise these things themselves—that would be much the best way to tackle this—and the GLAs or the harbour authorities should be asked to offer support to the extent that they are capable of doing so.
A further issue arises in this regard; namely, what is the definition of a wreck? The definition in the convention is that it is,
“any object that is lost at sea from a ship”.
I suspect that the drafters of that definition meant to refer to containers, which regularly fall off ships. People run into them occasionally and it does not do them a lot of good. Noble Lords will remember the MSC “Napoli”, which foundered on a beach in Devon a few years ago. A lot of containers were washed ashore, including some with new BMW motor bikes inside, which soon “walked”. However, in 1992—nearly 20 years ago—something like 29,000 yellow rubber duck bath toys were lost overboard in the Pacific Ocean. These ended up around the Pacific. I do not think that they were a hazard to shipping or to anyone else but they illustrate the fact that this definition of “wreck” might need to be tightened up. However, I am sure that none of the GLAs or harbour authorities would want to get involved in that.
The Government’s response to the House of Commons Transport Select Committee's report on the draft Marine Navigation Bill 2008 stated that,
“the Government does not envisage that the new power in relation to the General Lighthouse Authorities would lead to their being directed to do things for which they have no … experience”.
That is a good statement but it would be very nice if the Minister could confirm that or go a little further and say that they would not be asked to do things for which they do not have the funds or the capability. Incidentally, I am very grateful to the Minister and to the noble Baroness, Lady Stowell, for arranging a meeting recently at which we discussed some of these matters. I understand that a memorandum of understanding may be being drafted by the GLAs and the Government before the convention comes into force to set out some of these issues in more detail. I hope that the Minister will tell us where the Government have got to with this. Can a draft be placed in the Library? I have concentrated my remarks on the GLAs but the harbour authorities deserve equal treatment as regards MoUs as some of them have very small budgets. They probably have less capability in this regard but may still be instructed by the Government to undertake these operations. That could result in their going bust, which I am sure is not what the Government intend. However, it could happen under the Bill.
To conclude, I think we are all striving for the same result. It is generally a good Bill and we want to ensure that our seas are safe and clean. We want responsible ship owners to behave and to be properly insured. However, we have to get the detail right. We can talk about whether the Bill needs amendment in Committee. In addition to support from the Chamber of Shipping, I have received support from the British Ports Association, which represents most of the ports around the country, except for one or two big ones, and the British Tug Owners Association, which might benefit from doing a spot of salvage. I very much look forward to hearing what the Minister has to say and to more detailed discussion at the next stage.
Lord Greenway
My Lords, I, too, thank the noble Baroness, Lady Stowell of Beeston, for the clear and concise way in which she introduced this small but important Bill. At the outset I must declare an interest as an unpaid Elder Brother of Trinity House.
I welcome the Bill, which incorporates the wreck-removal provisions from the draft Marine Navigation Bill, which has been waiting on the shelf in some dark and dusty government corner for a while, but which neither the previous Administration nor the present coalition have so far seen fit to bring forward. As the noble Baroness said, the Bill paves the way for the Government to ratify the Nairobi International Convention on the Removal of Wrecks, which was adopted by the International Maritime Organisation some four years ago. The convention will come into force, as the noble Lord has just said, one year after 10 states have signed up to it. My understanding is that so far just one state has signed up, though I may be wrong about that. However, within the first year at least six states signified that they agreed with it, as they are entitled to do.
The present situation regarding wreck removal within our territorial waters—the 12-mile limit—is covered by provisions in Sections 252 and 253 of the Merchant Shipping Act 1995 which empower Trinity House and the other two general lighthouse authorities to mark, raise, remove or destroy any vessel,
“sunk, stranded or abandoned in any fairway, or on the seashore or on or near any rock, shoal or bank”,
in England or Wales,
“or any of the adjacent seas or islands”,
where there is no harbour or conservancy authority with power to do so, if in the opinion of the general light house authority,
“the vessel is, or is likely to become, an obstruction or danger to navigation or to lifeboats engaged in lifeboat service”.
Factors affecting safety of navigation include the clearance depth over the site at lowest astronomical tide; the depth of water in the area; the type, size and construction of the vessel; traffic density and frequency; the proximity of shipping routes; the type of traffic; and the topography of the seabed. Decisions about wreck removal or dispersal are inextricably linked to the danger presented by the wreck in terms of these factors, about which Trinity House and the other general lighthouse authorities have significant knowledge and expertise.
The Bill empowers the Secretary of State to deal with wrecks in a greatly expanded area up to 200 miles from the UK’s territorial waters. This is most welcome because it clears up an area of uncertainty that previously existed regarding the interpretation of “adjacent seas and islands”. Many an expert legal opinion has been sought on this without any true result. The legal position is now made clear, and that is certainly to be welcomed. Until now, Trinity House, with the agreement of the Department for Transport, has marked wrecks within this expanded area when they have been a danger, but dispersal has not ordinarily been carried out if the wreck is a foreign-flagged vessel due to a number of legal difficulties, including obtaining flag-state consent.
I welcome the fact that the onus of locating, marking and removing wrecks is now placed firmly on the owner of the vessel. I also understand that a state may extend the convention to its territory and territorial sea and that the present Government have indicated their wish to do so. This is to be welcomed because it will clear up any possible confusion between the present arrangements and those obtained in the convention.
I also welcome the expanded definition of wreck. It includes:
“any part of a sunken or stranded ship, including any object that is or has been on board such a ship”,
and,
“any object that is lost at sea from a ship and that is stranded, sunken or adrift at sea”.
In the past, Trinity House has, where necessary, dealt with such objects, such as floating containers, mentioned by the noble Lord, Lord Berkeley, in the interests of safety of navigation, but hitherto has not been able to recover its costs.
Another welcome development is a draft memorandum of understanding between the Secretary of State and the general lighthouse authorities, setting out how they will exercise their respective roles and responsibilities under the convention and the Merchant Shipping Act. The general lighthouse authorities have been working for some time with the Secretary of State's representative. They know each other well; they know each other's capabilities. It is a great step forward to have that set down properly in a memorandum of understanding, which will certainly help to progress matters.
Several noble Lords, especially the noble Lord, Lord Berkeley, expressed concern on behalf of ship owners that the convention could result in a greater call on the general lighthouse funds as a result of the cost of removing wrecks of uninsured vessels. At the moment, within the General Lighthouse Fund there is a contingency to deal with uninsured losses, so ship owners should be aware that there is already provision to cover such losses, although, as we have heard, with the new compulsory insurance provisions in the Bill, it is likely that calls on the General Lighthouse Fund should reduce over time.
The noble Lord, Lord Berkeley, also mentioned passing ships that are not coming to UK ports. From 1 January next year, a new EU directive will require all ships weighing more than 300 gross tonnes belonging to member states or visiting EU ports to have insurance to cover the limits of their liability under the international Convention on Limitation of Liability for Maritime Claims 1976, as amended by the protocol of 1996. All the time, more measures are coming into force that are making it more difficult for ships sometimes referred to as rogue ships to operate on our high seas.
The noble Lord, Lord Berkeley, also queried whether the Secretary of State or his representative should direct the general lighthouse authorities to deal with wrecks. My reading is that that has to be done for them to recover their costs. That is how it works under the convention. The general lighthouse authorities or harbour authorities are not party to the convention, so they have to be appointed by the Secretary of State or his representative.
Trinity House and the other general lighthouse authorities have a long history of dealing with wreck matters—about 150 years. They have great experience. The area that Trinity House is responsible for covers one of the busiest waterways in the world, the English Channel, where the waters are not very deep. Wrecks off the west coast of Scotland and Ireland tend to be in deeper water; if they sink, they go down a very long way. In some ways, Trinity House has more experience of dealing with such matters.
Several wrecks have been mentioned, but noble Lords may remember that back in December 2002 the Norwegian car carrier “Tricolour” collided with the container vessel “Kariba”, resulting in the Norwegian vessel sinking just as it was about to enter the north-south shipping lane through the English Channel. Two days later, the wreck was struck by another vessel, which was towed off; and two weeks after that, a tanker carrying 77,000 tonnes of gas oil also struck the wreck. As a result of that incident, the International Association of Marine Aids to Navigation and Lighthouse Authorities put in place a plan to provide emergency wreck buoys. Trinity House was very involved in their development. These are new buoys which can be taken out fairly quickly and have vertical red and yellow stripes. Trinity House also came up with a new form of lighting—an alternating blue and yellow flash which is highly visible and should go a long way towards alerting other ships of a wreck until such time has been found properly to survey it and mark it with normal, proper wreck buoys.
With regard to floating wreckage, such as containers or even timber, there were two incidents not so long ago in which large amounts of timber were washed off ships and floated up the English Channel, with most of it ending up on the beach. I believe that work is in hand to come up with some sort of floating wreck mark that would float up the Channel with any such mass of cargo. That would be a very sensible way of marking that sort of thing. However, to allay some of the concerns of the noble Lord, Lord Berkeley, I can say that the general lighthouse authorities certainly know their limitations and there is no way that they could be made responsible—
Lord Berkeley
I thank the noble Lord for giving way. I said that I thought that the GLAs were very competent to do that, and they have long experience of doing so. My concern is that they may end up having to fund the salvage.
Lord Greenway
I was just coming to the fact that they are well used to marking wrecks, although, when it comes to the salvage or removal of wrecks, such incidents are very few and far between. Over the past 10 or 12 years the GLAs have been involved in dealing with perhaps a couple of small fishing boats. Therefore, there is no way that the general lighthouse authorities would be involved in something like the MSC “Napoli”. The removal of larger ships is totally beyond their powers, and negotiations between them and SOSREP would very quickly sort out the best way of dealing with a wreck and deciding who should do the work.
I conclude by summing up where the Bill takes us. As I said, it introduces measures that Trinity House very much welcomes. It empowers the GLAs to locate, mark and remove wrecks which are a danger to navigation beyond the territorial sea, clarifying an area of legislation where there has been uncertainty. It makes registered owners responsible for reporting wrecks or for loss of cargo and for the costs of locating, marking and removing wrecks. It requires registered owners of all vessels over 300 gross tonnes to maintain insurance to cover their liability under the convention. It provides for any claim for costs arising under the convention to be brought directly against the insurer or other person providing financial security for the registered owner’s liability, therefore reducing the risk of non-recovery and, in so doing, also reducing the exposure of the General Lighthouse Fund to the cost of dealing with wrecks.
I very much welcome this small but nevertheless important measure. I wish it a speedy passage and look forward to what I hope will be ratification of the convention in the not-too-distant future.
Lord MacKenzie of Culkein
My Lords, I am delighted to be able to speak in this Second Reading of the Wreck Removal Convention Bill and I warmly support it. I take the opportunity to congratulate the noble Baroness, Lady Stowell of Beeston, on taking charge of the Bill in this House.
Coming from a family that includes past and presently serving merchant marine officers, not to mention four generations of lighthouse keepers, I have an interest in this legislation. Indeed, I asked questions of the previous Government on the progress, or lack of progress, in the implementation and ratification of the Nairobi convention.
The Bill should not be contentious. It will allow the UK Government to ratify the international convention on wrecks. At present, there are no uniform international rules under which coastal states have a proper legal basis to remove, or have removed, shipwrecks which are a hazard to navigation and/or the environment. The convention, when it comes into force, will fill that gap.
I am strongly of the view that there can be little or no argument against the need for the relevant UK authorities responsible for dealing with shipwrecks to take action, where safety of navigation is at stake, outside our territorial waters. The Bill will resolve that present lack of legal clarity in recovering costs where wrecks occur between the 12-mile territorial limit and the 200-mile pollution control zone. It does that by giving the Secretary of State power to deal with wrecks up to the 200-mile limit.
Secondly, and importantly, is the convention requirement that all vessels of more than 300 tonnes, with a very few exceptions, will be required to have wreck removal insurance cover or some other security in place. That is not an added-on cost to reputable shipping companies—by far the vast majority—which will already have insurance in place. But we all know that, at present, there is always a possibility that owners of some vessels will not have the necessary insurance cover. We need only to see the poor state of some of the ships detained by the Maritime and Coastguard Agency that are reportedly referred to as “rust buckets”, and to see the poor crewing—sometimes crews are not paid—to realise that wreck recovery insurance must be compulsory. It is only right that, as proposed, ships without wreck removal cover in place are not allowed to enter or leave a United Kingdom port.
The convention will also allow direct action for recovery from the insurer of a wreck of the costs incurred by general lighthouse or other authority in marking or, as set out in Articles 7, 8 and 9 of the convention, recovering wrecks. There have been occasions in the past when the relevant protection and indemnity club uses a device to reimburse the owner of the wreck only—I emphasise only—if that owner meets the cost to the lighthouse or other appropriate authority in the first instance. That so-called “paid to be paid” rule may be thought of as a clever device on the part of the insurer to avoid it paying up when a ship owner, who might own just a single vessel, does not have the funds or the desire to remove that vessel, particularly if it is a non-UK-registered ship. Thus the costs of marking and, if necessary, recovery have to be met from the General Lighthouse Fund. Like others, I do not think that that is acceptable, and I hope that the convention, by making insurance compulsory and allowing authorities to go direct to the insurer, will resolve that matter.
I understand that some shipping interests, as has already been said, are concerned that the convention may have the effect of increasing costs to the General Lighthouse Fund and thus lead to higher light dues. I do not think that that will be the case because, as the noble Lord, Greenway, said, the General Lighthouse Authority has been doing its statutory job of marking wrecks that are a danger to navigation for a long time—something like 150 years. It has that considerable knowledge and the expertise to make decisions about marking and the removal of wrecks, if necessary. It is right that it should continue to provide a seamless service rather than have multiagency involvement.
The costs to the GLF where incurred at present—again this has been said in the debate—represent a fairly small proportion of the overall costs of provision of safety of navigation in our waters. If the convention comes into force, there should be fewer costs not recoverable given the new rules on insurance and strict liability. I hope, therefore, that it should be possible to reduce quite significantly the reserve for wreck recovery, which I think stands at some £5 million in the GLF. That, I should have thought, will be some relief to the light-dues payer.
It is right, too, that where the General Lighthouse Authority recovers containers washed overboard or other detritus that might now be defined as a wreck in the convention, it should be able to recover these costs. I do not think that it can be some relief to my noble friend Lord Berkeley that GLA ships will be chasing yellow ducks round the ocean, even though that might technically be defined as a wreck. I hope therefore that the Bill has a smooth passage through this House. It will allow the United Kingdom to ratify the convention which is a necessary contribution to safety and will clarify a number of areas of responsibility in matters of safety in navigation and in the protection of our precious maritime environment.
In conclusion, I will pick up on a point made by the noble Lord, Lord Greenway, about whether the Nairobi convention was originally included in the Marine Navigation Bill. Other important matters are included in the Bill. Perhaps the Minister can tell us whether it is the Government's intention to bring forward these matters as soon as parliamentary time is available. The remaining matters in the Marine Navigation Bill are unlikely to be contentious or time-consuming and I hope that they, too, can be brought forward.
Lord Davies of Oldham
My Lords, of course the Official Opposition welcome the Bill, which is a constructive step forward. Therefore we are grateful to the noble Baroness, Lady Stowell, for introducing it so clearly. We are even more grateful for the fact that the debate attracted a range of very well informed contributors, who have tested the Bill and indicated areas where there is room for further explanation in Committee, which I am sure we will all enjoy.
I have no doubt that the Minister is exercising his mind on the government Front Bench as we speak. One factor that often obtains with a Bill of this kind is that at least one noble Lord is able to provide most of the answers to questions that are thrown up in debate and which the Minister would also like to answer. The noble Lord, Lord Greenway, has played that role today in tackling entirely appropriate questions put by my noble friend Lord Berkeley, my noble and learned friend Lord Boyd and by the noble Lord, Lord Bradshaw. We all also respect my noble friend Lord MacKenzie of Culkein, who speaks with great authority in these areas from his vast experience. I am sure that the noble Lord, Lord Greenway, provided areas of reassurance about the lighthouse authorities and the way in which the Government will be expected to enforce the Bill.
The word “enforce” causes us all to be greatly exercised. We need in this debate to address two questions: first, who will bear the costs, which can be substantial; and, secondly, what will be the level of enforcement? The noble Lord, Lord Greenway, indicated that through the development of the convention, authorities will find themselves reasonably comfortable about the Government's intentions. However, we all know that the costs could be considerable. There will be wrecks that we cannot foresee. I was grateful to my noble and learned friend Lord Boyd for referring to the most dramatic incidence of dealing with a wreck, which was when the “Torrey Canyon” was bombed and napalmed by the Royal Air Force. It was a dramatic solution to a problem, but one which is scarcely available to us as we deal with oil pollution on vast stages.
We all appreciate the threat to navigation on the sea and to effective maintenance of waterways by the occurrence of significant wrecks. The noble Lord, Lord Bradshaw, indicated the nature of the problem. Who pays is related to the effectiveness of enforcement. If enforcement is lax, the danger is that the industry or the taxpayer will be inveighed with costs because the people who should have been insured are not and cannot meet the costs. The noble Lord, Lord Bradshaw, identified the problems that the motor car industry has with insurance at present. The key is obvious: as my noble friend Lord MacKenzie suggested in his contribution, rust buckets and careless owners have to be tackled by the port authorities with the degree of rigour that ensures that vessels that put in to British ports have the insurance to guarantee that the costs do not fall unduly on the public authorities.
Secondly, my noble friend Lord Berkeley was right to examine the question of costs in those circumstances. It might not be easy, certainly in the short term, to obtain the necessary resources from those responsible for the wreck. Therefore, there is a question about what can be demanded of the lighthouse authorities. We look upon the development of the agreement. I am sure that the Minister will be able to give greater detail in his contribution. We look upon that as a cardinal point in giving us reassurance on these matters.
This debate has identified enough issues for the Minister to wish to give us considerable reassurances in his speech and for the noble Baroness, Lady Stowell, to be all too well aware of the fact that the whole House is committed to ensuring that this Bill succeeds. However, at the same time, it will be appreciated that we will have a fairly lively and interesting Committee stage in order to explore further the broad issues that have been identified today. Even with the best will in the world, and I know the Minister will deploy that best will, it is likely that a few question marks will still remain for us to consider at a later stage.
Earl Attlee
My Lords, I thank my noble friend Lady Stowell for the excellent way in which she introduced her Bill and mastered its technicalities faster than I managed to do. I suspect that she is still further ahead than I am. I listened with interest to all noble Lords’ contributions. It is, of course, for my noble friend Lady Stowell to answer most of the questions. I will answer questions that noble Lords put to me representing the Government.
This Bill enjoys the full support of the Government and I am happy to confirm that its provisions are compatible with the European Convention on Human Rights. It will improve our response to wrecks still further and, crucially, ensure that owners of ships are responsible for the costs of wrecks and the hazard they cause and that owners of larger ships maintain insurance to deal with those costs.
The noble Lord, Lord MacKenzie of Culkein, asked me about the other contents of the draft Bill. There are complexities, including the interests of the noble Lord, Lord Berkeley, with his Bill, and I will have to write to the noble Lord. I will place a copy of the letter in the Library and send a copy to all other noble Lords who have taken part in the debate.
The actions of ship owners and insurers are currently influenced by the value of what can be recovered, which means a significant proportion of the costs associated with locating, marking and removing wrecks continues to be met by the taxpayer. The costs of dealing with individual incidents can also vary considerably depending on such things as the size of the vessel and the nature of the cargo. For example, the cost to the Government of dealing with the container ship MSC “Napoli”, mentioned by the noble Lord, Lord Berkeley, which was beached in Branscombe Bay in 2007, was approximately £2.7 million, of which only £1.3 million will be recovered by the Government. However, the costs are not usually that high. Based on a 10-year average and with a cost recovery of approximately 70 per cent, depending on the circumstances, the annual cost as things stand is around £500,000. When the convention is ratified and enters into force in the United Kingdom, that cost is expected in practice to fall to just £40,000, a potential saving of £460,000 annually to the taxpayer.
The Bill would enable the United Kingdom’s authorities to recover their costs from the ship owner, who has primary responsibility for removing the wreck, or from the insurer directly. The Bill does not prevent the general lighthouse authorities or the harbour and conservancy authorities from acting in exercise of their existing powers for dealing with hazards that are a threat to navigation or to lifeboats, but it does provide the means, in cases where they have been directed by the Secretary of State, to recover costs which are not recoverable under the present arrangements.
Of course there can be no absolute guarantee of full cost recovery, so on the rare occasion that there is a shortfall, these costs will have to be met from elsewhere. In this regard, it is important to understand that the Bill maintains the status quo. For the general lighthouse authorities this will be through the General Lighthouse Fund, for the harbour authorities through harbour fees, and for the Maritime and Coastguard Agency the taxpayer. This is no different from the current methods used to make up any shortfall in expenditure by these bodies when carrying out their statutory obligations for dealing with hazards that are a threat to navigation or to lifeboats.
The noble Lords, Lord Berkeley and Lord Davies of Oldham, expressed a concern that any shortfall in costs incurred by these bodies would place an additional financial burden on the GLF and the financial reserves of the harbour and conservancy authorities. With the Bill imposing strict liability on the ship owner to remove a wreck, and by requiring mandatory insurance, the Government are of the opinion that the risks of a shortfall in expenditure will actually be significantly less for these bodies than they now experience.
The noble Lord, Lord Bradshaw, asked me whether the Government would stand behind the GLA. As I have just said, the situation will be much better for the authorities when the Bill comes into force. Historically, the cost of handling wrecks has been a small proportion of the GLA budget, a point made by the noble Lord, Lord MacKenzie. As a proportion of its budget the costs of wreck handling, excluding the costs of the SM “UB-38”, is only 0.004 per cent. If the exceptional costs of the SM “UB-38” are included, the percentage rises to 0.32 per cent. So we are talking about a very small proportion of the total budget of the GLA. He also asked how sure I could be that ship owners would hold valid insurance, while the noble Lord, Lord MacKenzie, raised a point about port state control visits under the Paris MoU. Our port state control visits are targeted, as are those of other states. We acquire information from a variety of sources. As to the UK fleet of over 300 tonnes, there are only 1,200 ships, so it is easy for the MCA to monitor them and ensure that they are insured. Further, the certificates are authenticated by Governments, which for the UK is the MCA. There is a difficulty as regards passing ships not calling at an EU port, but the situation will be no worse than it is now.
Returning to the point made by the noble Lord, Lord Berkeley, I would also stress that the Secretary of State’s powers of direction are discretionary, so these bodies will not necessarily be instructed to locate, mark and remove every hazard. The noble Lord told us the amusing story of the rubber ducks in the Pacific Ocean, but the convention is not applicable to them because they are not a danger to navigation or harmful to the marine environment. In exercising these powers, the SOSREP—the Secretary of State’s representative—who can take charge in such situations, would be expected to have full regard to the capabilities of the directed authorities. Indeed, there would be no point in directing those bodies to undertake tasks for which they did not have the capability or experience, a point made by the noble Lord, Lord Greenway. The noble Lord asked me whether I could go a little further on this. I do not think that I can at this point, but I can assure your Lordships that the arrangements will be made clear in a memorandum of understanding between the respective parties to ensure that they are aware of their responsibilities and that wrecks are located and marked as soon as practicably possible, whether or not the wreck is a hazard to navigation. It is intended that this memorandum of understanding will be agreed between respective parties prior to entry into force of the convention. The noble Lord suggested that we examine these points in Committee. I am sure that my noble friend Lady Stowell will be able very competently to deal with them.
I hope that the House will recognise the considerable benefits that this Bill will bring to those bodies that already do such an excellent job in keeping our waters safe. To that end, I join my noble friend Lady Stowell in commending it to the House.
Baroness Stowell of Beeston
My Lords, I am extremely grateful to all noble Lords who have contributed to the debate today. I thank them for their broad support for the Bill.
My noble friend the Minister has responded to most of the questions raised, but there are one or two points to which I should like to respond. The noble Lord, Lord Berkeley, asked about progress on ratification of the convention. So far, three states have ratified it: India, Iran and Nigeria. Furthermore, in December 2008, all EU member states made a firm commitment to express their consent to be bound by the convention by no later than 1 January 2013. The noble Lord also raised questions, to which the Minister referred, around the Secretary of State being able to “direct” the general lighthouse authorities. Perhaps I may reinforce what the Minister and the noble Lord, Lord Greenway, said by explaining that the term “direct” is important because it means that, if the Secretary of State decides to issue a direction, the authorities will then be parties to the convention. If the Secretary of State does not “direct”, they will not enjoy the same benefits of the convention as others.
The noble Lord, Lord Davies of Oldham, suggested that I could look forward to lively and interesting debates in Committee. I like lively and interesting, and I hope by that stage to be able to respond to the suggestion of the noble Lord, Lord Berkeley, that the memorandum of understanding between the Government and the GLA be made possible for other authorities involved.
The noble Lord, Lord Berkeley, asked about the role of the harbour authorities under the terms of the convention. It is worth making it clear that the instruction from the Secretary of State to harbour authorities will apply only in the harbours or waters that they already control. There would be no extension of any responsibility for them beyond that which they already have.
I think that I have covered all of the issues relevant to me. If there is anything further, I am sure that I can follow it up in writing.