Airports Slot Allocation (Amendment) (EU Exit) Regulations 2019
Baroness Sugg Excerpts(5 years, 10 months ago)
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Baroness Sugg
That the draft Regulations laid before the House on 10 December 2018 be approved.
Air Services (Competition) (Amendment) (EU Exit) Regulations 2019
Baroness Sugg Excerpts(5 years, 10 months ago)
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Baroness Sugg
That the draft Regulations laid before the House on 5 December 2018 be approved.
The Parliamentary Under-Secretary of State, Department for Transport (Baroness Sugg) (Con)
My Lords, if it is convenient, I will speak to both the Air Services (Competition) (Amendment) EU Exit Regulations 2019 and the Airports Slot Allocation (Amendment) (EU Exit) Regulations 2019. These instruments will both be made using powers in the European Union (Withdrawal) Act 2018 and will be needed if the UK leaves the European Union without a deal.
The two draft instruments will correct the following retained EU regulations: Regulation 868/2004, which is intended to provide protection for Community air carriers against injury caused by subsidisation and unfair pricing practices relating to air services between EU member states and third countries; and Regulation 95/93, which sets out the process for the fair and transparent allocation of airport slots—the right to use a bundle of facilities at airports for landing or take off of an air service at specific dates and times; for example, runways, stands and terminals where the demand at congested airports exceeds the available infrastructure.
I turn first to the draft air services competition instrument. The EU regulation sets out the process and requirements for imposing redressive measures in the form of tariffs or fines where it has been demonstrated that subsidies or unfair pricing practices by third-country bodies and air carriers, with respect to routes between EU member states and third countries, have caused injury to the EU aviation industry. This EU regulation has never been used and is currently in the process of being replaced. However, the effect of Section 3 of the European Union (Withdrawal) Act 2018 is that any direct EU legislation which is in force and applicable on exit day will automatically become part of the UK’s statute book. Therefore, the instrument that we are considering today simply makes those corrections necessary so that the version of Regulation 868/2004 brought into UK law by the EU withdrawal Act is, in principle, legally operable after exit day.
This instrument makes only technical corrections to the retained Regulation 868/2004, meaning that the substantive requirements for assessing whether there has been subsidisation, unfair pricing practices or injury to industry remain exactly the same. The corrections include ensuring that the scope of the retained EU regulation is correct once the UK has left the EU; for example, substituting references to “Community” with references to the “United Kingdom”. This has the effect that the retained regulation applies where there has been injury to the UK aviation industry. Instead of applying where there are unfair pricing practices by “non-Community” air carriers on certain routes to and from the EU, the retained regulation will apply where “non-United Kingdom” air carriers have engaged in unfair pricing practices on certain routes to or from the UK. Similar changes apply in relation to the subsidisation provisions in the retained EU regulation.
This instrument also transfers functions currently carried out by EU institutions to appropriate bodies in the UK. For example, it transfers the function of carrying out investigations covering subsidisation and/or unfair pricing practices from the European Commission to the Civil Aviation Authority.
Finally, this instrument transfers the function of imposing provisional or definitive redressive measures to the Secretary of State. As the EU regulation sets out that the process for this is through further regulations, this instrument also sets out that any provisional or definitive redressive measures would be imposed by the Secretary of State through regulations.
I turn next to the draft airports slot allocation instrument. The EU regulation applies at congested airports where the availability of adequate infrastructure is insufficient to meet demand. The regulation sets out conditions that must be met for an airport to be “schedules facilitated” on a voluntary basis or subject to “slot co-ordination”. A thorough capacity analysis must first be carried out, which must be done within six months, if air carriers representing more than half of the operations at an airport or the airport authority consider capacity to be insufficient for actual or planned operations, or upon request from the European Commission, in particular if new entrants encounter serious problems in securing slots.
The regulation also specifies that any decision that an airport should be subject to slot co-ordination should be taken following thorough capacity analysis and consultation with users of the airport and that an independent slot co-ordinator should be appointed by the relevant member state. The following airports in the UK are currently subject to slot co-ordination: Birmingham, London City, Gatwick, Heathrow, Luton, Manchester and Stansted; and Bristol Airport is partially co-ordinated for the summer season. Airport Coordination Limited, or ACL, has been appointed as the slot co-ordinator for UK airports, and has been performing this function for some time.
Under the regulation, slots are allocated to air carriers that held the slot in the previous season and have demonstrated use of the slot at least 80% of the time during that season. The remaining unused slots are returned to what is known as the slot pool, alongside any newly available slots; 50% of the slots in the slot pool are available to new entrants. The regulation also makes provision for member states to reserve certain slots for essential domestic services, such as public service obligations, and for slots to be exchanged between carriers or transferred between different routes or types of service.
Finally, the regulation contains provision for reciprocal action, to ensure that Community carriers requesting slots in non-EU countries are treated fairly.
Once again, the draft instrument we are considering makes only minor changes to ensure that the retained EU regulation, Regulation 95/93, continues to function correctly once the UK has left the EU, alongside the domestic Airports Slot Allocation Regulations 2006 which were made to implement the EU regulation. Most of the changes the instrument makes are to ensure that the scope of the retained regulation is correct; for instance, reflecting that the retained regulation will only apply to airports in the United Kingdom after exit day, removing references to “Community law” and EU treaties, and removing or amending references to member states, as these will no longer include the UK after exit day.
Through the 2006 implementing regulations, the UK has fulfilled the requirements for member states to appoint a body or person to carry out functions such as designating an airport as schedules facilitated or co-ordinated, and appointing a schedules facilitator. The UK conferred these functions on the Secretary of State through the 2006 regulations. This instrument corrects the provisions in the EU regulation so they read consistently with the 2006 implementing regulations, reflecting that the UK has already fulfilled its obligation to confer these functions on an appropriate authority. Other roles for EU institutions, such as the European Commission’s role of carrying out investigations, are removed or replaced.
The instrument also makes corrections to some of the definitions contained in the EU regulation; for instance, substituting the definition of a “Community air carrier” with a definition of a “UK air carrier”. For the purposes of allocating slots from the slot pool, the EU regulation defined “new entrant” as including air carriers with few, if any, slots which requested slots for scheduled services between two Community airports where at most two other carriers operate that route. This instrument amends that part of the definition to provide for continuity, so that it captures both air carriers requesting slots for passenger services between two UK airports and carriers requesting slots for services between a UK airport and an airport in an EEA state.
The regulations provide that a proportion of slots can be reserved for PSOs. This SI amends the definition of a PSO in line with the corrections already made to provisions in EU law on PSOs, through the Operation of Air Services (Amendment etc.) (EU Exit) Regulations 2018. This means that, instead of being open to Community air carriers, “qualifying air carriers” will be eligible to operate PSOs in the UK. This will include UK air carriers and carriers from other countries that have cabotage rights in the UK—the right to fly between two points within the UK. As is currently the case, any PSO can be limited to one carrier by the Secretary of State only after a tender process has been followed. This change has no effect on the PSO routes already operating in the UK.
In terms of reciprocity, this instrument amends the provisions in the EU regulation so that, instead of the Commission being able to take action to ensure that Community carriers requesting slots in non-EU countries are treated fairly, the provisions give powers to ensure that UK carriers requesting slots in another country are treated fairly in the allocation of slots at that country’s airports. This instrument therefore sets out that it is the Secretary of State, rather than the European Commission, who may wholly or partially suspend the operation of the retained Regulation 95/93 in relation to air carriers from a non-UK country, with a view to remedying discriminatory behaviour of that country. The EU regulation currently provides for this action to be taken through a regulation and this instrument transfers that function to the Secretary of State, who could carry this out through regulations.
Finally, this instrument makes some minor changes to the 2006 implementing regulations, for instance removing the requirement for co-ordination committees at airports to invite the European Commission to meetings. It also makes a change to Annexe XIII to the EEA agreement, which requires parties to the agreement to inform the European Commission about serious difficulties encountered by UK air carriers in obtaining airport slots in third countries. This provision will not apply to the UK after exit day in the event of no deal, as we will no longer be a party to the EEA agreement, so it will be removed by this instrument as it will be redundant.
As I said during the debate on the previous SI, the best outcome for the UK is to leave the EU with a deal, and delivering a deal negotiated with the EU remains the Government’s top priority. However, as a responsible Government, we must make all reasonable plans to prepare for a no-deal scenario. These instruments ensure that, in the event of a no-deal exit from the EU, the legislative framework for aviation, in particular relating to the allocation of slots at congested airports in the UK, continues to work effectively, and that the aviation industry has clarity about the regulatory framework in which it would operate in a no-deal scenario. I beg to move.
Baroness McIntosh of Pickering (Con)
My Lords, this is designed to be helpful, so I hope that my noble friend will not put me in the “troublemaker” category. I will start with a couple of questions on the airport slots allocation. What will happen to the current grandfather rights, in particular those that might be enjoyed by EU carriers? Will they continue to be enjoyed after exit day? If that is the case, and this regulation comes into effect, what will happen to the grandfather rights currently enjoyed by UK carriers in EU airports?
On the civil aviation competition regulations, paragraph 7.2 of the Explanatory Memorandum states—my noble friend clearly said it in her opening remarks too—that it is not expected that this regulation will come into force. That begs a question. I cannot believe that there have been no unfair pricing practices and no cases of subsidy; if there have, what legislation has been used? There are some very worrying issues about this regulation and the European Commission regulation on connectivity which is going through the EU institutions at the moment.
My noble friend raised the question of cabotage rights in the UK currently enjoyed by EU carriers. Of much greater concern is that the market access proposals in the EU regulation currently before the EU institutions set alarm bells ringing, for me and I am sure for many of the UK carriers, when they were set out in December. It is my clear understanding that cabotage rights and fifth freedom rights will be lost.
I declare my interest; I was one of those in the European Parliament at the time who campaigned for years to get cabotage and fifth freedom rights. When I met my husband, who was at the time working for Delta Airlines, my opening line was, “Why will the US Government not allow cabotage and fourth and fifth freedom rights for European carriers in the US?”, which I think is currently not the case. If UK and EU carriers are going to retain only third and fourth freedom rights, how can that be in the interests of the UK airline sector?
I am sure that my noble friend is more aware than anyone of the importance of the UK airline sector. It turns around £52 billion a year, exports £26 billion, supports almost a million jobs and clearly supports the economy, whether it is Leeds Bradford Airport or any of the London airports. All international airports support their local economies as well. Therefore I would be grateful if my noble friend could say what the impact will be on UK airlines of the loss of cabotage and the loss of fifth freedom rights in the EU, whether or not there is a deal, because I understand that will be the position anyway, whether it is this regulation or another regulation going forward.
I understand that there will also be an impact on capacity. Obviously airlines such as Ryanair are currently going through difficulties. I am not a shareholder in any airlines. I almost lost my shirt on British Airways, so I am currently not investing in any airlines, but it is fair to say that Ryanair has the potential to expand, as do easyJet and a number of other UK carriers. Did the Government therefore have any input into the decision that has been taken—namely, that UK carriers will be allowed to operate in the EU only at the level that is frozen to 2018 levels? Presumably what is before us would be a temporary regulation, so that if there is a deal then these regulations would not come into play. However, I am extremely concerned that in future we will be locked into the 2018 frequency levels, affecting UK travellers who desire to travel within the European Union and UK airlines that desire to expand. Is there anything the Government or this House can do to reverse that?
At the end of March, the summer season schedules will be published. What are those timetables for flights going to look like? Will they be as full as they were last summer? Will they be provisional and will they have to be revisited?
There is some toing and froing according to press reports as well, and the Government face a deadline imposed by the European Commission of seven months to decide on the make-up and composition of an EU airline. As touched on in an earlier debate, this has severe implications for this regulation—no doubt it will for other regulations as well. It has ramifications for Ryanair, which we imagine is based in Dublin but which has a large number of non-EU shareholders, but of more concern is the UK flag carrier, British Airways, which is now under the umbrella of the IAG. Are we going to face the fact that British Airways under the IAG might not be recognised as an EU carrier?
Lord Tunnicliffe (Lab)
My Lords, I shall speak very briefly on these two instruments—there is no way we will oppose them. The first one is on competition. One’s enthusiasm for scrutinising in depth was somewhat killed by the first sentence in paragraph 7.2 of the Explanatory Memorandum, which says:
“The powers in the EU regulation have never been exercised and it is unlikely that they ever will be”.
At that point, I gave up detailed examination. This boils down—if there ever is a dispute in this area—to us having moved from a big gang called the EU to a little gang called ourselves. That is why I am not keen on crashing out of the EU without an agreement, because being part of the EU is, broadly speaking, a good thing when it comes to aviation.
I have some experience of the slots issue. The trouble is that it is 30 years old, so things may have changed, but I doubt it. In a sense, the general public do not realise what an airline is. An airline is, first and foremost and overwhelmingly, a timetable—you attach airplanes, crews and marketing to it, but you start with the timetable. In fact, I chaired one of BA’s internal committees which oversaw the process of developing the timetable, and the slots are a key part of it. They work, frankly, because there is an international consensus between airlines, airports and regulating authorities that the various slot allocation committees at various airlines will be co-ordinated on a worldwide basis to make the system work. This system has been fiddled with, but it has been pretty robust for 50 years. I take comfort from the Explanatory Memorandum, which says, as it should:
“The system relating to slot allocation at UK airports will remain unchanged”,
by this SI. Providing the Minister reaffirms that, it will have my support.
We have heard some comments. These would require policy changes to meet the challenges that the comments are directed at. I remind noble Lords that the one thing you cannot do under Section 8 of the European Union (Withdrawal) Act 2018 is introduce any policy changes. In so far as that is the instruction to government in generating these SIs, I have to support the fact that, as far as I can tell, they have followed that instruction.
Baroness Sugg
My Lords, I thank noble Lords for their consideration of these draft instruments. On the slot allocation system, we are not moving to operate on our own. The current system of slot allocation, including the EU regulations, is based on guidelines produced at an international level by IATA. Those guidelines are not affected by EU exit. The system for slot allocation at UK airports will be the same after exit day as it is today, except that the role of the EU Commission will no longer apply.
The noble Lord is quite right to point out that slot reform in general has been around for some time, but there is an international consensus around this and we are considering it in our consultation strategy, Aviation 2050: The Future of UK Aviation. We set out a number of potential issues with the current process for slot allocation affecting competition in the aviation markets, such as historic grandfather rights and retiming, but there is a long-standing international system, so we will work very closely with the industry, IATA and countries with which the UK has aviation links to discuss that.
My noble friend Lady McIntosh asked whether current grandfather rights will be the same. Again, those will remain the same after exit day. As the noble Lord, Lord Tunnicliffe, pointed out, this does not change any policy on this and those rights that UK carriers have at EU/EEA airports will also not be affected.
On the point about the replacement of the competition regulation, raised by the noble Baroness, Lady Randerson, and my noble friend Lord Balfe, the UK has participated fully in the legislative process regarding the replacement regulation; it is now ready to be put to the European Parliament and the Council of Ministers, and it is intended to serve the same purpose as the current regulation—ensuring fair competition. But the powers, as I said, and as highlighted by my noble friend Lady McIntosh, have never been exercised and it is unlikely that they ever will be. The EU has reviewed the regulation, but the vast majority of our bilateral air services agreements have articles governing fair competition, and these are what we use to ensure that there is a level playing field in the operation of international air services. That is why it has not been used and we do not expect it to be used.
My noble friend Lord Balfe asked, as he did previously, about our future plans. We keep our legislation under ongoing review and will continue to do so after exit day to make sure that it meets our policy objectives and legal obligations. While we would not be under an obligation if we left without a deal, if we chose to implement the replacement regulation it would be through primary legislation. Again, my noble friend is right to point out that, of course, in the event of a no-deal exit the EU’s statute book will continue to move on and we will need to be flexible about ours.
My noble friend Lady McIntosh asked about timetables. Airlines have already published their timetables for flights post March 2019 and tickets are being sold. The noble Lord, Lord Bruce, asked about Aberdeen and the allocation of slots. As I mentioned before, slots are allocated through ACL and the EU: the Government have no role in the allocation of slots and airlines determine how they are allocated on a commercial basis. Of course, if a carrier does not use its slots 80% of the time, they will be returned to the slot pool for allocation. We have the option of PSOs if needed, but the decision about specific slots will be down to the commercial airline.
My noble friend Lady McIntosh asked about the EU regulations. She is right to point out that they were published in December. There has been many a conversation on those, through industry and through member states. We are seeing some proposed changes, particularly on a capacity freeze, as my noble friend pointed out. I agree with her that the aviation sector is incredibly important to this country, which is why we are working hard to ensure that the industry can continue to grow sustainably. She is right that there are issues around ownership and control. We have not seen the headquarters of easyJet move but we have seen easyJet take on a Swiss air operator certificate. There is no immediate issue, as my noble friend pointed out, but, as one might expect, EU carriers are working closely with the Commission on that.
We are seeking continued participation in the European Aviation Safety Agency. That will help us continue trade as well as flights. We have played a significant role in EASA over the years and we very much hope to continue to do so. PSOs will be open to qualifying carriers—those with cabotage rights in the UK—and that has already been fixed in the operation of air services SI. Those carriers with cabotage rights could include those from the EU and other countries, so there will be the same requirements for PSOs going forward.
I hope that I have answered most of the questions. If I have not, I will follow up in writing.
Baroness McIntosh of Pickering
On the question of the damage to UK carriers arising from the loss of cabotage rights and freedom rights, do we have any estimate of what that will be?
Baroness Sugg
We are working very closely with the Commission on that. Obviously, there are implications both ways. We remain committed to working with the Commission on the regulation to avoid that. Of course, there are UK airlines which fly cabotage in the EU, in the same way that there are EU airlines flying cabotage in the UK. That is another example of how it is in our mutual best interests to ensure that we continue the market access we have today. Those discussions are ongoing and as soon as I have an update on them I will be happy to share it with noble Lords.
While we are working to agree a deal with the EU that is supported by Parliament, we need to continue our responsible preparation. Both the UK and EU have set out their intention to put in place arrangements to ensure that planes will continue to fly; none the less, these instruments are essential to ensure that we have a legal framework, particularly in respect of the allocation of airport slots, that continues to work effectively in the UK from exit day. That will help ensure the continued smooth operation of air services, irrespective of the outcome of the negotiations. I beg to move.
Air Passenger Rights and Air Travel Organisers’ Licensing (Amendment) (EU Exit) Regulations 2018
Baroness Sugg Excerpts(5 years, 10 months ago)
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Baroness Sugg
That the draft Regulations laid before the House on 28 November 2018 be approved.
The Parliamentary Under-Secretary of State, Department for Transport (Baroness Sugg) (Con)
My Lords, these regulations will be made using powers in the European Union (Withdrawal) Act 2018 and will be needed if the UK leaves the European Union without a deal. This draft instrument corrects three EU regulations that provide an important consumer protection regime for passengers travelling by air. It also makes some changes to the Civil Aviation (Air Travel Organisers’ Licensing) Regulations 2012, which were amended recently to implement elements of the package travel directive.
The three EU regulations are: Regulation 261/2004, which establishes the rights of passengers, including their right to compensation and assistance if they are denied boarding against their will, or if their flight is cancelled or delayed; Regulation 1107/2006, which establishes the rights of disabled passengers and those with reduced mobility to access air transport, and establishes their right to receive free-of-charge assistance; and Regulation 2027/97, which harmonises the obligations of Community air carriers regarding their liability for injury to passengers and damage to baggage, in line with provisions in the 1999 Montreal Convention.
The package travel directive provides for consumer protection in relation to package holidays and other linked travel arrangements. The directive is implemented in the UK primarily by the Package Travel and Linked Travel Arrangements Regulations 2018. Corrections to these regulations so that they continue to work after exit day have already been made through the Package Travel and Linked Travel Arrangements (Amendment) (EU Exit) Regulations 2018.
Provisions under the directive relating to insolvency protection are implemented in part through the Air Travel Organiser’s Licence—ATOL—scheme. The directive provides for the mutual recognition among EEA member states of insolvency protection regimes. This instrument makes changes to the ATOL scheme to reflect that this mutual recognition will no longer apply to the UK after exit day in a no-deal scenario.
The withdrawal Act will retain the three regulations I have just listed in their entirety in UK law on exit day. The draft instrument we are considering makes corrections to these retained EU regulations as well as the 2012 ATOL regulations to ensure that the statute book continues to function correctly after exit day. This means that air passengers can continue to benefit from the rights and protections set out in EU legislation.
On Regulation 261/2004, the substantive rights of passengers to assistance, rebooking and compensation in the event that they are denied boarding or subject to long delays or cancellations remain the same. The EU regulation sets out that these rights apply to passengers travelling on a flight departing any airport in the EU, and flights departing an airport in a third country to an airport in the EU, if the carrier is an EU carrier. This instrument makes changes to the scope of the retained regulation to reflect that the UK will no longer be part of the EU after exit day. The retained regulation will apply in relation to all flights departing an airport in the UK and flights departing an airport in another country if the carrier is a UK carrier.
To ensure full continuity on the routes in relation to which passengers can benefit from the rights and protections set out in Regulation 261/2004, the retained regulation will also apply in respect of flights into the EU from countries other than the UK, if they are operated by a UK carrier. It will also apply in respect of flights from third countries to the UK if they are operated by an EU carrier. Other changes the instrument makes reflect that the UK will no longer be part of the EU, and include converting compensation amounts set out in euros in the EU regulation to pounds sterling.
Finally, the instrument ensures that the CAA is fully and effectively able to enforce the retained regulation. It sets out that provisions relating to complaints, and domestic legislation containing criminal offences for persistent breach by air carriers of provisions in the retained EU regulation, apply to the same routes—
Lord Foulkes of Cumnock (Lab Co-op)
My Lords, on a previous occasion, the Minister was not able to say how many extra staff the CAA has taken on to deal with this extra responsibility. Is she now able to give us that figure? How much will it cost?
Baroness Sugg
If the noble Lord will wait, I will come on to CAA resourcing. Obviously, we work very closely with the CAA to ensure that it is sufficiently resourced.
Lord Foulkes of Cumnock
Did the Minister say she will tell us how many extra staff are required and how much this will cost at a later stage in the debate? I did not quite catch that.
Baroness Sugg
I will come on to CAA resourcing at a later stage in this speech, if the noble Lord will give me a minute.
Finally, this instrument ensures that the CAA is fully and effectively able to enforce the retained regulation. It sets out that provisions relating to complaints and domestic legislation containing criminal offences for persistent breach by air carriers of provisions in the retained EU regulation apply to the same routes and air carriers as the retained EU regulation itself.
On Regulation 1107/2006, the rights that disabled passengers and persons with reduced mobility are able to benefit from when travelling by air also remain unchanged. These include the right to assistance at airports without additional charge and the right to assistance by air carriers without additional charge. Once again, this instrument ensures full continuity for consumers by making certain that the retained regulation—Regulation 1107/2006—will apply after exit day to passengers using or intending to use commercial passenger air services on departure from, transit through or arrival at UK airports.
Certain provisions will also continue to apply in relation to flights departing from a third-country airport to the UK if the flight is operated by a UK air carrier. Like Regulation 261/2004, these provisions will also apply to flights into the EU from countries other than the UK if the flight is being operated by a UK carrier and flights from third countries to the UK if the flight is being operated by an EU carrier. These provisions set out that: air carriers and tour operators cannot refuse travel to passengers on the grounds of disability or reduced mobility; that if it is not possible for an air carrier, agent or tour operator to accommodate a passenger with a disability or with reduced mobility on the grounds of safety or the size of the aircraft or its doors, the passenger shall be reimbursed or be offered rerouting; and that air carriers are required to provide assistance without additional charge, such as allowing assistance dogs in the cabin of the aircraft and arranging seating suitable to meet the needs of the individual.
The third regulation covered by this instrument is Regulation 2027/97, which sets out provisions relating to the liability of air carriers in relation to the injury or death of passengers, as well as damage to or loss of baggage. Most of the provisions in this regulation implement elements of the 1999 Montreal Convention, and the changes that this instrument makes to the retained regulation are limited to those needed to reflect the fact that the UK will no longer be an EU member state after exit day; for example, substituting references to “Community air carrier” with references to “UK air carrier”.
Lord Adonis (Lab)
My Lords, the Minister is talking about EEA-registered operators that operate in the UK. An issue was raised in the House of Commons about whether there would be full ATOL protection in respect of people purchasing packages in the UK under those EEA-registered operators. The Minister there was not able to give an answer but said that he would write to MPs. I have not seen a copy of that letter—could the Minister tell us the answer to that specific point, which of course will be quite significant if there is no deal?
Baroness Sugg
I hope I can answer the noble Lord’s question. Those EU and EEA companies which sell package holidays in the UK will need to be covered by the ATOL scheme. They will need to apply for an ATOL from the CAA. We believe that there are only about 13 such companies.
Lord Adonis
Is the Minister saying that that will be a requirement under these regulations? Is she saying that there will be full ATOL protection for all passengers and purchasers of package holidays in that eventuality?
Baroness Sugg
Yes, that is what I am saying. As I said, at the moment there are only 13 EEA-established businesses currently selling to the UK that would be affected by the requirement, and the CAA is used to processing around 1,000 cases a year. Therefore, in answer to the question put by the noble Lord, Lord Foulkes, the CAA is confident that it is fully resourced to achieve this.
Lord Foulkes of Cumnock
My question is not whether the CAA is fully resourced. My question—which I asked in Grand Committee a number of weeks ago, so the Minister has had plenty of notice of it—is how many extra staff is the CAA taking on, and how much extra is it going to cost? She said she was going to answer it later in her speech. Could she please answer it now?
Baroness Sugg
I am afraid I will have to come back to the noble Lord on the exact number of staff who have been taken on. As he will understand, this is a moving feast, and the CAA is taking on extra people to deliver all the requirements that will be placed on it in the event of a no-deal Brexit. But I will endeavour to come back to the noble Lord later in the debate with a specific answer on the latest figure for the number of new staff at the CAA.
Lord Deben (Con)
I want to explain to my noble friend why this question is important. Every time we discuss one of these statutory instruments, we do not have the figures for the cost. My concern is that in each individual case it is said, “Well, it is not all that much and somebody is doing some arrangement”, and all the rest of it. But if you start to add them up, you possibly have a very significant cost. That is why it is important that we understand precisely what the figures are.
Baroness Sugg
I entirely understand my noble friend’s point of view. Of course it is important that we understand the full costs of this. The CAA is taking on a number of new responsibilities and functions after EU exit. As I said, we have confidence in its preparations. Regarding ATOL—I mentioned the figures before—we think the current level of staff will be able to provide this service, so we do not expect to see a significant increase in workload from this SI. The latest figure for the number of new staff is around 59, most of whom will carry out safety functions. The House will debate another SI on safety, which will have cost implications. I will ensure that I am able to provide actual cost implications for future aviation SIs. In this case, there are none, as we are expecting only a small number.
The best outcome for the UK is to leave the EU with a deal, and delivering a deal negotiated with the EU remains the Government’s top priority. However, as a responsible Government, we must make all reasonable plans to prepare for a no-deal scenario. This instrument ensures that, in the event of a no-deal exit from the EU, passengers travelling by air can continue to benefit from the same rights as they currently do, and that the aviation industry and consumers have clarity about the regulatory framework which would be in place in a no-deal scenario. I beg to move.
Baroness McIntosh of Pickering (Con)
My Lords, I have two brief questions on this statutory instrument. My noble friend the Minister has stated that compensation will be paid in pounds, converted from euros. What if the pound to euro ratio changes substantially over, say, the next two years? Is this something that her department and the Government are likely to keep under review?
I tried to follow the Minister’s explanation as closely as I could. If I have understood correctly, there is one category of flight that UK passengers will no longer be compensated for. I dealt with this myself when I was an MEP and, at one stage, rapporteur on civil aviation in the European Union. I would just like her confirmation that this category of flight is covered. These are flights where passengers start with a UK carrier out of London Heathrow, Gatwick or Stansted, but change at an airport within the EU, such as Amsterdam, to a connecting international flight operated by, for example, Singapore Airlines or Delta Airlines—both of which my husband worked for at separate times—to a destination such as New York or Singapore. Is my noble friend saying that, under these regulations, or in the event of no deal, a UK passenger who is denied boarding that flight in a third-country airport such as Amsterdam will no longer be compensated?
Lord Tunnicliffe (Lab)
My Lords, I rise wearily to my feet. The first thing I would like to register is my objection to being here. Once again, we are here to discuss a statutory instrument which addresses the issue of what we do if we leave without a deal. It is a deeply depressing pastime, discussing statutory instruments to lead this country into a catastrophic situation.
It is also depressing that the Government, if they wanted to hang on to what might be an intellectually narrow point, that any responsible Government should prepare for the worst scenario, if they had truly believed that, then surely they would have started the process much earlier so that we are not shovelling SIs through this Chamber by the shovelful, for want of a better way of doing it.
One of the problems of the sheer volume is that I certainly am not having enough time to give the level of scrutiny that I think is appropriate. Therefore, one tends to have to use short methods. The first that one is left to have to use is looking at the regulation itself, which is usually impossible. You need a very expensive lawyer to go through the regulations, see what they amend and what the effects are. The only thing a reasonable amateur such as myself can do is to go to the Explanatory Memorandum and see if it makes sense. If one does that, one comes to paragraph 2.3, which is “Why is it being changed?” I will read it because it is so reassuring:
“This instrument makes the changes needed to retained EU legislation on air passenger rights and domestic legislation made to implement the UK’s obligations under the Package Travel Directive. These changes ensure that the legislation continues to function correctly after the UK has left the EU. They also ensure that there is continuity in terms of the passenger rights that apply to air travel and that consumers will continue to be protected if there is no mutual recognition of insolvency protection regimes after exit day”.
Now, I think that says it is going to be all right, but I am required to scrutinise, so I did my best, and I have worked my way through the document. I confess I did not pick up the ownership point, and I look forward to the Minister’s response on that. If that statement is right, one works through the Explanatory Memorandum, and it puts in changes and does things to make that right. If it is right, can the Minister answer this question: in the event of a no-deal situation and this SI then becomes operative, is there any group of passengers or consumers whose rights and protections are diminished or lost after exit day?
The second question I have relates to the optimistic scenario, where there is a deal and this SI will not be required. One constantly looks for a sunset clause in these SIs which would allow that to operate. Could the Minister explain how we will handle this SI and the others that we are going to face today if there is a deal? Experience has taught me that one of the few things you have to go to in these SIs is the commencement provision. That says that Regulations 5(1) and 5(2) will be commenced 22 days after the regulations are made. That, I assume, will be somewhat before exit day. At present, it seems that the decision on whether we have a deal will be very close to exit day, so, if there is a deal, how is this SI going to be stopped from being enacted without a mechanism within it?
Baroness Sugg
My Lords, I thank all noble Lords for their consideration of these draft regulations. I am grateful for the scrutiny provided by noble Lords. These are important pieces of legislation, and it is right that they are properly scrutinised. I would not class the noble Lord, Lord Warner, or indeed any other noble Lord as a trouble-maker. I will attempt to get to all the questions, but if I do not manage to cover them, I will respond in writing.
On the point made by my noble friend Lady McIntosh, the Explanatory Memorandum sets out the exchange rate used to calculate the amounts. It is the average for the year to 31 December 2017, which has been used across the statutory instruments. There are currently no plans to change that.
In response to the noble Lord, Lord Berkeley, let me say that this regulation will cover all carriers with a UK operating licence. That is issued by the CAA, so that is how we define who will be covered by these regulations in the event of a no-deal exit. The requirements of the operator’s licence are set out in the operation of air services regulations, which we debated last year.
On enforcement, if it is a UK carrier—that is, one with a UK operating licence—the CAA will enforce it. If it is departing from an EU member state, that member state will enforce it, and if it is a UK carrier departing from a third country, the CAA will again enforce it. So the example that my noble friend Lady McIntosh used of a flight departing from the UK will be enforced by the CAA, and the flight which then departs from the EU will be enforced by that relevant member state—I cannot remember which member state she referred to.
Baroness McIntosh of Pickering
My question was about those UK passengers who board the next leg of the flight in Amsterdam or what would be a third country with an international carrier. Does the regulation now exclude them from denied boarding rights and other privileges that they would otherwise be entitled to?
Baroness Sugg
I should first point out that these regulations apply to everyone who travels on a plane regardless of nationality, so actually the nationality is not important. The important part is the carrier that operates the flight. In that example, as I said, the flight leaving the UK would be covered by the CAA and the flight leaving Amsterdam, regardless of the nationality of the passenger, would be covered by the existing EU regulations, so that would not change.
Lord Berkeley
Will the Minister explain what would happen in the reverse direction? Say you are flying Nigerian Airways from Lagos to Amsterdam with a through ticket to London with another carrier. What is the enforcement on the compensation rules there?
Baroness Sugg
They will remain the same. The flight operating into the UK from a third country will be enforced by the CAA, and a flight operating into the EU would be covered by that EU member state. I understand that this is a little complex, so I will list exactly what will be covered.
But before doing that, on code sharing, asked by my noble friend Lady Altmann, the carrier operating the flight will be liable under the regulation, irrespective of who sold the ticket.
I will attempt to be a little clearer than I was in my opening speech. This regulation will apply to: all flights departing a UK airport; flights to the UK from a country other than the UK if on a UK air carrier; flights to EU airports from a country other than the UK if on a UK air carrier; and flights to UK airports from a country other than the UK if on an EU air carrier. That applies to passengers of any nationality.
So in answer to the question asked by the noble Lord, Lord Tunnicliffe, about who will be disadvantaged by this, in short no one will be adversely affected. The aim of this SI is absolutely to maintain continuity after exit day. In the event of no deal, passengers will retain the same rights as they have today. In the event of a deal, which will obviously get us to an implementation period, this SI along with many others will be amended or revoked.
I take the point made by my noble friend Lord Deben that all things aviation will not stay the same in the event of no deal. That is why we are trying to avoid that. But in the case of this SI, the rights will stay the same—
Lord Adonis
The Minister says that no one will be adversely affected. I accept that in response to all carriers or travel businesses that are registered in the United Kingdom, but if a UK resident buys a ticket or a package from a company or carrier that is registered only in the EU or EEA, they may well suffer diminution of their rights. Is that correct?
Baroness Sugg
All EEA and EU companies which sell in the UK will be required to have an ATOL scheme licence.
Lord Adonis
If, after a no-deal Brexit, a UK citizen buys a package or flight from an operator which is in the EU or EEA but which is not registered in the United Kingdom, we have no guarantee that there will be reciprocal continuation of ATOL rights.
Baroness Sugg
Each member state has its own version of ATOL, and the companies which sell in that member state are obliged to follow it. In the event of no deal, there will not be mutual recognition; that is simply one of the consequences of no deal. Those companies will be covered by the EU regulations. I said that no one is affected, but some of the companies which sell into the UK will need to get an ATOL licence. However, for air carriers, airports and passengers, there is no change to the routes on which the regulations apply. After exit day, in the event of no deal, the combined scope of UK and EU legislation on air passenger rights will be the same as under the current EU regulation. I hope that is a slightly simpler explanation than the one in my opening speech.
My noble friend Lord Balfe is right that, in the event of no deal, this simply takes a snapshot in time. I agree with him and the noble Baroness, Lady Randerson, that what happens in the EU in future will affect the UK, whether that is a change in currency exchange or EU law. However, that is something for the future; it may well depend on a future aviation agreement, if we end up with no deal. I am afraid I cannot predict the future, so I cannot say how we may respond to any future change in EU law. What I can say is that this statutory instrument does not contain any powers to make further SIs, and any future changes are likely to require primary legislation and would therefore have sufficient parliamentary scrutiny. However, I take the noble Baroness’s point that changes in the EU regime will have an effect on us.
On the issue of confidence in booking flights, we are completely focused on ensuring that there is no disruption of aviation, as this would be in nobody’s interest. In our technical notices last summer, we confirmed that we envisage granting permits to EU carriers to operate in the UK, and we have seen the EU take similar steps to avoid disruption. There were Commission communications on the EU’s preparedness in November and it has said it intends to bring forward measures to allow UK air carriers to continue to fly to the EU. Most recently, this includes its no-deal contingency plan, which was published on 19 December. Detailed EU regulations are being discussed in the Parliament and the Council at the moment. We welcome those proposals, which will ensure that flights between the UK and the EU are maintained. There are a number of pieces of clear evidence that both sides in aviation are determined to ensure we maintain air connectivity.
We work very closely with the aviation industry, which shares our confidence that arrangements will be in place to avoid disruption to flights. I take the point from the noble Lord, Lord Adonis, that many conversations about aviation—those that he has had and those that others will have in future—take place at a European level and, indeed, an international level, at ICAO. We hope to continue our close relationship on aviation with all our European partners, regardless of how we leave the European Union.
On the noble Lord’s point about consultation, the noble Lord, Lord Berkeley, was quite right to say that the same text is used here and in the next SI. As you would expect, I meet people from across the aviation sector very regularly, whether from airlines, airports or industry groups such as the Airport Operators Association and Airlines UK. We have not had meetings specifically about single SIs—there are quite a few of them—but we are discussing our SI programme with the aviation sector and sharing our plans with it. Throughout our SI programme, and certainly in aviation, we are replicating the current situation so that there will be no change. The compensation is perhaps not universally popular among our airlines, but they accept that the important thing is to maintain continuity, so that passengers and airlines understand what will happen. That is what we have been trying to do.
On communications, I agree with the noble Lords, Lord McNally and Lord Warner, that it is really important that we keep consumers informed. The noble Lord, Lord Adonis, highlighted one of those adverts on Spotify; there are others. We have a cross-government campaign putting out the information that is available on GOV.UK, and we are also working very closely with airlines and consumer groups to ensure that the right information is available. For example, Thomas Cook has a very good Q&A section around Brexit on its website. We are trying—
Lord Warner
I am grateful to the Minister for giving way. Just to go back to my earlier exchanges with the noble Lord, Lord Adonis, the government website seems to be telling people to be careful about making bookings after 30 March. However, in this debate the Minister is spreading balm and harmony about the fact that people would not have any of their rights and protections diminished. If there is no diminution of rights and protections, why does the Government’s website urge people to be careful about making bookings after 30 March?
Baroness Sugg
I am not sure that the Government’s website uses the word “careful”. As I said, we are confident that flights will be maintained. There is an EU regulation going through the EU Parliament and EU Council at the moment to confirm that. In the same way that this statutory instrument has not yet been passed, that regulation has still not been passed. We are confident that flights will continue, but we say that customers should contact their air carrier and check their terms and conditions in order to ensure they are fully aware of all the information that they need.
On the rights and protections, as I have said, this SI continues them; we are confident that, should noble Lords choose to pass it, we will be able in the event of no deal to ensure that consumers still have the same protections.
While we are working to agree a deal with the EU that is supported by Parliament, we think it is responsible to continue to make preparations in the absence of an agreement so that there is a functioning statute book. This SI, and the others that we will debate later and in the coming weeks, are a key part of those preparations. Both the UK and the EU have set out their clear intention to put in place arrangements to ensure that planes can continue to fly to and from the EU in the event of a no-deal exit. Both sides want to avoid any disruption to flights, as that would be in no one’s interests.
Our contingency preparations, of which these regulations are just one element, should provide reassurance to industry and consumers that, even in the event of no deal, passengers will continue to benefit from the same rights as they currently do. They ensure that our legal and regulatory framework for aviation is set up for flights to continue, whatever the outcome of negotiations. I beg to move.
Seaborne Freight
Baroness Sugg Excerpts(5 years, 10 months ago)
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The Parliamentary Under-Secretary of State, Department for Transport (Baroness Sugg) (Con)
My Lords, with the leave of the House, I will repeat in the form of a Statement the Answer given by my right honourable friend the Secretary of State for Transport to an Urgent Question in the other place. The Statement is as follows:
“In December, following a collective government decision and a procurement process involving my department and the Treasury, we contracted three shipping companies to provide additional ferry capacity as part of contingency planning for a potential no-deal EU exit. Let me start by being absolutely clear that, in the event of a no-deal Brexit, the Government’s priority is to ensure the smooth operation of both the Port of Dover and the Channel Tunnel, and we are putting in place measures at the UK end to contribute to this.
However, any sensible Government plan for all eventualities. That is why we agreed contracts worth around £100 million, with the bulk of the award, £89 million, going to DFDS and Brittany Ferries to provide services across seven separate routes. Built into those agreements are options to add capacity on two other routes from those companies should they be required. This capacity could be required to guarantee the smooth flow of some key goods into the UK, particularly for the NHS. It is worth reminding the House that, in the event of no deal and constriction on the short straits, this capacity would be sold on to hauliers carrying priority goods.
In addition to the £89 million-worth of contracts with DFDS and Brittany Ferries, the Department for Transport entered into a £13.8 million contract with Seaborne Freight to provide ferry services from the Port of Ramsgate to Ostend. At the time of the award, we were fully aware of Seaborne’s status as a start-up business and the need for Seaborne to secure vessels and port user agreements to deliver a service. However, the shorter distance between the two ports meant that the route could provide us with shorter journey times and lower cost, making it a potentially attractive part of the package.
Seaborne’s proposition to the department was backed by Arklow Shipping, Ireland’s biggest and one of Europe’s largest shipping companies. For commercial reasons I have not been able to name Arklow Shipping or mention its involvement to date. But its support for the proposition from the outset, and the assurances the department received, provided confidence in the viability of this deal. Arklow confirmed to me that it intended to finance the purchase of ships and would be major shareholders in Seaborne. It also confirmed to me its view that the Seaborne plans were, ‘both viable and deliverable’. These assurances included clear evidence about the availability of suitable vessels from the continent and about the formal steps which Seaborne, via Arklow, had taken to secure these vessels.
However, releasing this information into the public domain could have significantly driven up the cost of the vessels and might even have resulted in them being removed from the market, where supply is extremely scarce. I have therefore had to refrain from saying anything publicly to date about this.
My department monitored closely the progress of Seaborne towards meeting its contractual commitments. By last week, the company had secured firm options on ships to operate on the route, and had reached provisional agreement with Ostend and was close to doing so with Ramsgate. However, late last week, despite previous assurances, Arklow Shipping suddenly and unexpectedly withdrew its backing from Seaborne. In the light of this, and after very careful assessment, I took the decision to terminate this contract. My department concluded that there were now too many major commercial issues to be resolved to enable Seaborne to establish alternative arrangements and finance in the time needed to bring ferries and ports into operation.
As I have repeatedly made clear, not a penny of taxpayers’ money has gone or will go to Seaborne. The contracts we agreed with the three ferry companies are essentially a commitment to block book tickets on additional sailings after the UK leaves the European Union, so actually we have taken a responsible decision to make sure that taxpayers’ money is properly protected.
I can confirm that the contracts with DFDS and Brittany Ferries remain on track and will provide us with valuable additional freight capacity into the UK in the event of disruption following EU exit. We also have contractual options to replace the Seaborne capacity with additional capacity on routes in the North Sea, and this is an option we will be discussing across government in the coming days.
While the focus of this Government is to secure a deal with the European Union, as a responsible Government we will continue to make proportionate contingency plans for a range of scenarios. That is the right thing to do”.
Lord Rosser (Lab)
I thank the Minister for repeating the Statement. On 8 January, my noble friend Lord Tunnicliffe was told by the Government:
“With Seaborne, the proposal was subject to technical, financial and commercial assurance”.—[Official Report, 8/1/19; col. 2127.]
What were the financial assurances received and from whom? Were the financial assurances given specific, firm, unqualified and in writing, or were they only in the form of an intention or a consideration of giving financial support, as the Statement suggests?
Why was no reference made in the Statement of 8 January to the extensive involvement on the financial side of the Irish company Arklow Shipping? The Government said it was for commercial reasons. What commercial reasons were so important that they overruled the public interest and transparency on a Brexit issue? Perhaps instead it was because the Secretary of State was so determined to have the involvement at all costs of a British shipping company, to avoid the embarrassment of having to rely exclusively on European companies to help us out of a no-deal mess, that he reached this questionable agreement with Seaborne Freight without competitive tendering and then knowingly did not disclose in the Statement that even British Seaborne Freight was dependent on financial backing materialising from an EU-based Irish company? If that is not the case, why was the agreement not reached directly with Arklow Shipping, one of Europe’s largest shipping companies and clearly the intended real power behind Seaborne Freight?
Baroness Sugg
My Lords, we have listed the checks carried out as due diligence on the operational suitability of all the bids submitted as part of the department’s procurement of additional freight capacity. They were director searches and basic counterparty financial solvency checks, with technical support provided by Mott MacDonald. Two high-level technical reviews were completed. The first related to the ferry tender and submission compliance within the DfT evaluation process and the second to the technical feasibility of the tendered ferry intervention. Financial analysis was carried out by Deloitte to assess the financial robustness of operators, and price benchmarking by Deloitte to examine the prices offered to DfT in comparison with market rates to enable the assessment of value for money as part of the procurement process.
I explained earlier in the Statement the reasoning behind not mentioning Arklow before. It was for commercial reasons. It would have adversely affected the cost of ships in order to procure the contract. We contracted directly with Seaborne because it was the company that had been working for over a year to provide the service between Ramsgate and Ostend.
Baroness Randerson (LD)
My Lords, we now know that the Government’s own estimate is of an 87% reduction in cross-channel trade for three to six months if there is no deal. Given that the whole point of Brexit no-deal preparations is to minimise risk, why did the Department for Transport approve the contract with Seaborne when it was known that there was a high risk that the company would not be able to fulfil the contract? When we spoke about this on 8 January, the Minister gave me solemn assurances that the financial backing for Seaborne was good. How did that situation change so dramatically overnight?
What the Minister did not tell me on 8 January was who will pay for the dredging of Ramsgate harbour. The Minister told us today that no public money will be put forward to Seaborne, but who will pay for the dredging of the harbour, given that we now know that no company could provide ships in time for a no-deal Brexit to use that harbour?
Baroness Sugg
My Lords, we went ahead with the contract with Seaborne on the understanding that it was a start-up company and did not currently provide the service. As I explained, this was a shorter and therefore cheaper route, which was why we were keen to make use of it. But we have enough capacity in the remaining contracts for prioritised goods.
The DfT is not party to the dredging work at Ramsgate, but of course we will continue conversations with a number of stakeholders, including Thanet Council, over any plans to re-establish ferry services at the Port of Ramsgate.
Lord Campbell-Savours (Lab)
My Lords, the dredging started five weeks ago on 3 January, so accounts must have been submitted or Thanet Council will be aware of what the bill is. Have the Government been told how much that bill is? Will the Government pay that bill at the end of the day? How much is the bill to Slaughter and May, Deloitte and Mott MacDonald, to which the Minister referred, for the assessment of Seaborne’s business plans? Finally, in the Statement on 8 January, the Minister told us:
“We are concerned that in the event of no deal, there will be disruption at the Port of Dover … which is why we are making these contingency plans”.—[Official Report, 8/1/19; col. 2128.]
What replacement contingency plans are now being considered to deal with the disruption at Dover, which the Minister herself predicted?
Baroness Sugg
My Lords, as I said, the DfT is not party to the dredging work. I am not able to comment on the value of contracts held by entities other than my department. Dredging of the port is the responsibility of the relevant port authority and continues to form part of the ongoing discussions. As I said, the DfT will continue conversations with a number of stakeholders, including Thanet Council, over plans to re-establish the ferry service.
On the money paid around the Seaborne contract, the contract awarded to Seaborne was part of a broader procurement exercise to secure additional freight capacity after Brexit, and as part of that the three contracts were awarded. Extensive third-party due diligence was carried out on these so a cost would have been attached to the process even if we had never entered into an agreement with Seaborne.
Lord Birt (CB)
My Lords, the Minister has told us that substantial commercial due diligence was done on this deal, yet the Secretary of State’s Statement says clearly says that Seaborne,
“was backed by Arklow shipping”.
It goes on to say that Arklow offered support for the proposition, and finally that Arklow,
“provided confidence in the viability of this deal”.
Will the Minister explain more clearly than she has so far what the backing was, what the support was and what the assurances were?
Baroness Sugg
My Lords, I take this opportunity to remind the House that no taxpayer money has been transferred to the company and the Government stand by their robust due diligence carried out on Seaborne Freight. Perhaps it would be helpful if I read out some specific reassurances that Arklow provided to us. It said:
“Arklow Shipping has been working with Seaborne for twelve months in connection with Seaborne’s proposals to develop new freight services between the UK and continental Europe. Arklow Shipping is therefore familiar with Seaborne’s agreement with Her Majesty’s Government to provide additional freight capacity … In support of the current proposals to develop the shipping route … Arklow Shipping intends to provide equity finance for the purchase of both vessels and an equity stake within Seaborne which will be the operating entity of this project … Seaborne is a firm that brings together experienced and capable shipping professionals … I consider that Seaborne’s plans to deliver a new service to facilitate trade following from the UK’s departure from the EU are both viable and deliverable”.
That is from Arklow Shipping, which, as I said, is Ireland’s largest shipping provider and one of Europe’s biggest. That letter has now been published on the GOV.UK website.
Lord Howell of Guildford (Con)
My Lords, I should like to say a word on behalf of the trade union of ex-Secretaries of State for Transport, of whom there are several in your Lordships’ House. This case really confirms that the portfolio is a no-win situation because everybody is a critic and nobody is your friend. But in this particular case, are we to understand therefore that when the contract was first made, although it could not be revealed for commercial reasons, it was in fact being made to a combine that had dozens of ferries and enormous ferry experience? I know it had to be cancelled later when Arklow pulled out, but I am waiting to hear a flicker of recognition from those shoot-from-the-hip critics who rushed forward to criticise at the original time when they did not know the full facts. Would it not have been wiser to become a little more informed before the usual crowd gathered to criticise the Secretary of State?
Baroness Sugg
I thank my noble friend for those comments. The contract with Seaborne was specifically designed in recognition of the risk posed by contracting with a new operator and it protected the taxpayer, as it was always designed to do. As I said, no taxpayers’ money has been paid to Seaborne. My noble friend is quite right to point out the assurances that we received from Arklow Shipping. Noble Lords would expect a responsible Government to ensure that we are able to deliver capacity for critical goods in the event of no deal and that is what we are doing.
Lord Berkeley
The Minister seeks to blame Arklow for this withdrawal, but the Irish Times says something rather different. It states that Arklow was never “a backer”, did not have “any formal agreement” with Seaborne and was not “a contract partner”. Who is telling the truth?
Baroness Sugg
My Lords, the contract was with Seaborne Freight. I have read out extensively the reassurances provided by Arklow, which are set out in the letter published on GOV.UK. The contract, however, was with Seaborne and we entered into that given the reassurances that we had.
Parking on Pavements
Baroness Sugg Excerpts(5 years, 10 months ago)
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Lord Lennie
To ask Her Majesty’s Government what plans they have to prevent motor vehicles parking on pavements.
The Parliamentary Under-Secretary of State, Department for Transport (Baroness Sugg) (Con)
My Lords, in Greater London there is already a general ban on pavement parking. Across the rest of England, local authorities can implement local bans using traffic regulation orders. In recent months the Department for Transport has carried out a review of pavement parking, gathering evidence on the effectiveness of current legislation and the case for reform. That review is now complete and we are considering its findings.
Lord Lennie (Lab)
I thank the Minister for that Answer. Do the Government accept the views of Guide Dogs, the RNIB, the Living Streets charity campaign, all wheelchair users and all parents pushing a pushchair along the pavements, as well as all the local authorities that have to repair them after they have been damaged, that legislation should move to a default position, as is the case in London, of no parking on pavements unless designated otherwise, rather than just discourage- ment, which is currently the case?
Baroness Sugg
My Lords, a recent survey by the RNIB of more than 500 blind and partially sighted people found that 95% of them had collided with a street obstacle in the past three months. A vehicle parked on a pavement was the single most reported obstacle, so I do agree with the noble Lord that pavement parking is a problem. There are calls for the Government to introduce a law that bans all pavement parking across England, and the roads Minister is keen to make the process as simple as possible. However, before seeking new primary legislation we are evaluating the effectiveness of the current legislation. We want to understand the issues that have prevented councils taking action already.
Lord Holmes of Richmond (Con)
My Lords, does my noble friend agree that this is a curious Alice in Wonderland situation, where pedestrians have to go into the road because of cars that are already on the pavement? Some 69% of the public and 78% of local councillors support a new law. Are they right?
Baroness Sugg
My Lords, we have heard a lot of concern from interested groups, the general public, those with disabilities, the elderly and, of course, mothers with pushchairs about the incidence of pavement parking outside London. We have gathered evidence to try to understand the effectiveness of the current legislation. We are considering those findings carefully and we will make an announcement in due course.
Lord Low of Dalston (CB)
My Lords, I recently heard about someone who was knocked down on a pavement by a powered mobility scooter. She fell and broke her wrist. Does the noble Baroness agree that there is a need for tighter regulation of vehicles on pavements?
Baroness Sugg
My Lords, this is something that we are looking at. With the advent of new technology we are seeing new vehicles on the pavement. That will be one of our considerations when we look at the law on this.
Lord Bradshaw (LD)
My Lords, the Traffic Management Act 2004 imposed a duty on local authorities to manage their own road networks. The same Act also provided for traffic officers to be appointed to enforce these powers. However, Part 6 of the Act, which makes provision for penalties, has never been enacted. That leaves local authorities in a position where they have duties which they cannot carry out because they have no revenue streams from penalty notices to pay for enforcement. Will the noble Baroness look carefully at the Act, which, as I say, has never been properly brought into effect, but which does contain the powers that she is talking about? It would enable much more efficient management of both highways and pavements.
Baroness Sugg
My Lords, since the Traffic Management Act 2004 came into force, more than 93% of local authorities in England have taken up the powers. On the specific point about enforcement, I will have to follow it up with the department and write to the noble Lord.
Lord Berkeley (Lab)
My Lords, I am sure that the Minister will be aware that her colleague Jo Johnson wrote a circular letter in the autumn to local authorities, praying in aid—about penalties for persons committing nuisances while riding on footpaths—that people shall not,
“tether any horse, ass, mule, swine, or cattle, on any highway, so as to suffer or permit the tethered animal to be thereon”.
This came from the Highway Act 1835. Is it not about time this legislation was updated?
Baroness Sugg
My Lords, I was interested to find that cycling on a footway is also an offence under Section 72 of the Highway Act 1835. Obviously, it has been updated with various pieces of secondary legislation. As I say, we are looking carefully at the issues around vehicles on pavements and will respond in due course.
Lord McColl of Dulwich (Con)
My Lords, is the Minister aware that this practice can be lethal because of the glass and steel grids on pavements that allow light to underground structures? If a lorry goes over them, the whole thing can collapse and crash down and would kill anyone underneath.
Baroness Sugg
My Lords, I know that street furniture, including lamp-posts, also inhibits people in confidently navigating their way around the streets. Pavement parking can cause damage to paving stones and perhaps glass objects—so we are looking carefully at the evidence we have gathered.
Railways: Dawlish
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Lord Berkeley
To ask Her Majesty’s Government what progress has been made in improving the resilience of the railway line at Dawlish towards south Devon and Cornwall since the two-month disruption beginning on 5 February 2014.
The Parliamentary Under-Secretary of State, Department for Transport (Baroness Sugg) (Con)
My Lords, Network Rail has worked to develop long-term solutions to make the railway at Dawlish and Teignmouth more resilient to extreme weather, engaging an expert team of tunnel, cliff and railway engineers. This is part of a £15 million investment provided by the Government. The first phase of work to protect the sea wall began in November, with essential repairs now completed to four breakwaters. Following engagement with local stakeholders in autumn last year, Network Rail has now submitted plans for a new, stronger sea wall at Dawlish.
Lord Berkeley (Lab)
I am grateful to the Minister for that reply, and am sure the House will wish to congratulate Network Rail on the way it recovered from that terrible accident five years ago where the track was waving in the air with nothing underneath it. However, is the Minister aware that already this winter services have been disrupted on 10 occasions—sometimes because the tide is just over the tracks and the tracks are buried? One solution might be for the Secretary of State to play King Canute, but I am sure he would not want to do that. The alternative is to encourage Network Rail with some funding to go ahead with the issues that the Minister mentioned. Also, will she start looking at the process of reopening the Okehampton-Tavistock line, to provide a better service to Plymouth and Cornwall for when the line by the sea is disrupted?
Baroness Sugg
I join the noble Lord in congratulating Network Rail and the orange army who did such a great job of recovery after the storms more than five years ago. We have been clear that ongoing investment in the south-west transport infrastructure is a key priority, and we remain determined to find a permanent solution for Dawlish. As I said, £15 million of funding has been made available, and world-leading engineers have been carrying out detailed assessments. Network Rail is making good progress on its plans, and we are considering them carefully.
On the noble Lord’s point about the regular Okehampton service, we are working closely with the local councils on that. We responded to the future of the Great Western franchise consultation last August, and are looking into what scope of work will be needed to reinstate regular services on that route.
Lord Snape (Lab)
My Lords, does the Minister agree that it is not just the track that has been a problem, but the trains? Does she agree that the wretched Voyager trains used on this stretch of line are completely unsuitable for the journeys they undertake daily? Cancellations and short running take place every week, and as the 40 year-old British Rail-built high-speed trains are now coming off lease, why do the Government not modernise them and replace the Voyagers with properly built trains that would be far more comfortable for travel between Aberdeen and Penzance than the toy trains there are at present?
Baroness Sugg
My Lords, the noble Lord is right to point to the issues we have had on that track: when there are high waves and sea spray close to the track the Voyager trains cannot run, as they have brake resistors on top. CrossCountry is working to assess whether there might be engineering solutions that would enable the Voyager class to operate through Dawlish in those challenging conditions. We are also looking into providing further additional rolling stock, but the Government and franchise operators are investing heavily in new, improved trains.
Lord Teverson (LD)
My Lords, the economies of west Devon, Plymouth and Cornwall rely very much on this line. Last autumn a six-foot hole appeared under the track in the Dawlish area, so this is far from solved. Yet, despite Devon and Cornwall—regrettably—being stuffed with Tory MPs there seems to be no real action at all. Can the Minister give us a date when the fundamental structure, whether it is the line that the noble Lord, Lord Berkeley, refers to or the sea wall, will be completed? When will something be done?
Baroness Sugg
My Lords, this train line has been a long-standing problem ever since it was opened in 1846—that year trains failed to run along it. We are working closely on that and although I am not able to give the noble Lord a date, we are making significant progress. Network Rail has submitted a plan that we are looking at carefully and we hope to make an announcement on it very shortly.
Lord Rosser (Lab)
First, in very bad weather, as has been said, the Voyager trains used by the CrossCountry franchise are often unable to operate west of Exeter, as electrics on the roofs of the trains are adversely affected by salt water coming over the sea wall in the Dawlish area. Will the new Hitachi trains being introduced on the line also be adversely affected by salt water coming over the sea wall? Secondly, Network Rail’s plan for preventing sea damage is, as has been said, to build a new, higher sea wall, in respect of which it has made a planning submission to the relevant local authority, with the knowledge of the Secretary of State. We know the problem is only going to get worse as sea levels rise, so what happens if that planning application is declined? What is plan B? Or is there no plan B?
Baroness Sugg
The noble Lord is right to point to the issues we have with CrossCountry trains. The new intercity express trains on GWR were also affected by weather along the Devon coast last week, so we are working very closely with Hitachi to find a solution. As the noble Lord pointed out, there is a planning submission in play and, as I said, we are absolutely determined to come up with a long-term solution to this problem.
Baroness Watkins of Tavistock (CB)
My Lords, will the Minister clarify whether she thinks the only long-term solution is to have an alternative line from Exeter to Plymouth? Otherwise, we are perpetually trying to put right something that she acknowledges has been inappropriate since 1848.
Baroness Sugg
Since 1846. The case for reopening the former route between Exeter and Plymouth via Okehampton and Tavistock was assessed by Network Rail in 2014. It found that there was not then a case for reopening this route in its entirety. We are doing work on that: Great Western Railway has been asked to develop proposals to reintroduce regular services between Exeter and Okehampton; and Devon County Council is progressing work to develop the case for reinstating the railway between Bere Alston and Tavistock. Delivery of these schemes may enable the full reopening of the former route in the future, subject to a viable business case being demonstrated.
Lifeboats: Ceredigion
Baroness Sugg Excerpts(5 years, 10 months ago)
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Baroness Bloomfield of Hinton Waldrist
To ask Her Majesty’s Government what the impact will be on the coastguard of the RNLI’s decision to downgrade the all-weather lifeboats capacity in New Quay, Ceredigion.
The Parliamentary Under-Secretary of State, Department for Transport (Baroness Sugg) (Con)
My Lords, the RNLI is an independent organisation that declares its lifeboats available to Her Majesty’s Coastguard. It determines how and where it deploys the resources that it has available. Based on historical incident data and the outputs of the RNLI’s risk-assessed five-year review, we do not anticipate that its decision to replace the all-weather lifeboat with an Atlantic 85 vessel at New Quay will have an impact on HM Coastguard’s capability to co-ordinate search and rescue in Cardigan Bay.
Baroness Bloomfield of Hinton Waldrist (Con)
I, too, hesitate to criticise such a respected charity, but the replacement of the all-weather lifeboat with an Atlantic 85 inshore vessel, which cannot be launched in stormy conditions exceeding force 7, leaves a gap of 63 nautical miles in all-weather search and rescue provision. This and the alleged lack of a proper, open consultation with any local stakeholders concerned with sea safety in Cardigan Bay are a matter of grave concern to the local community. Will my noble friend the Minister intervene and ask the RNLI to publish its evidence and perhaps also to review its decision?
Baroness Sugg
My Lords, the RNLI’s decision was underpinned by extensive research of incident reports as well as information gathered in face-to-face meetings and workshops at the lifeboat station both before and after the coast review visits, to ensure that local knowledge and concerns were considered. The decision is a significant investment by the RNLI in the area—which of course we are very grateful for—with new, faster boats at all three RNLI stations. The RNLI view is that that is the optimal combination for future life-saving in the area. It has shared a 30-page extract of the report with the lifeboat operations manager, and I understand that it is in dialogue with a campaign group to ensure it has the appropriate information.
Lord Morris of Aberavon (Lab)
My Lords, I declare an interest as a former Lord Lieutenant of the county and my wife is from a long line of New Quay sailors. The Government have paid £3.5 million since 2014 to increase capacity and resilience in rescue, so they cannot wash their hands entirely to the RNLI. Since it is proposed that all-weather lifeboats will be as far away as Pwllheli and Barmouth, will the new inshore lifeboat at New Quay diminish capability? Will there be a gap in safety provision in Cardigan Bay in severe weather?
Baroness Sugg
My Lords, the noble and learned Lord is right to point out the change in provision. Three 17-knot Mersey class all-weather lifeboats are being replaced with two Shannon lifeboats at Pwllheli and Barmouth and there will be a smaller but faster lifeboat at New Quay. This was based on a risk-based review that looked at the entire area and the RNLI’s decision to replace the all-weather lifeboat was, as I said, underpinned by extensive research. It is convinced that this is the optimal amount of resource for the area.
Lord Harries of Pentregarth (CB)
I declare a personal interest as someone with long-standing family connections in the area and as a supporter of this campaign. The RNLI of course does wonderful work, but I am afraid that in this instance it has been totally lacking in transparency with the people of New Quay about the reasons for its decision. Despite what the Minister said, independent research shows that in severe weather conditions—force 7 in daylight and force 6 by night—it does increase the risk. There is a 70-mile gap, as I understand it, between the nearest all-weather lifeboats and it simply takes that much longer to get there. Should not an organisation such as the RNLI that depends on trust be more open about its decisions and in this instance look again at the increased risk of this decision?
Baroness Sugg
I thank the noble and right reverend Lord for his question. I know of his long-standing interest in the area. The RNLI, as I said, has shared a 30-page extract of the report and is working closely with a campaign group. I understand that the campaign group is made up of passionate people who want to ensure that they have the optimal provision in the area. As I said, along with the replacement new boat, the all-weather lifeboats in the surrounding area will be replaced with much faster ones. There is also a new helicopter base in St Athan, and the new boats, the helicopter and the increase in lifeguarding on the coast will not only maintain but improve life-saving provision in the area.
Baroness Humphreys (LD)
The RNLI’s decision to move the all-weather facility from New Quay has led to huge public disquiet in the area—an area where people understand the important role fisheries play in providing a livelihood for commercial fishing and angling vessels. They also understand the danger to the fishermen who brave all weathers. What assessment has the noble Baroness made of the importance of the all-weather lifeboat to the safety of fishermen in Cardigan Bay?
Baroness Sugg
My Lords, the RNLI carries out a coastal safety review every five years. It is a very extensive review based on extensive research; it considers all the rescue records and looks at all the reports of launches and incidents carried out by the lifeboat stations. It has concluded that services by the New Quay RNLI all-weather lifeboat could have been carried out safely and effectively by an Atlantic 85 inshore lifeboat, supported by the new, faster lifeboats at neighbouring stations if required. I understand that people who have long experience in this area locally are concerned about it. The RNLI continues to have conversations with them and will ensure that they are given the appropriate information.
Baroness Smith of Basildon (Lab)
My Lords, the Minister was asked just now what assessment she had made of the need in the area. She told us what assessment the RNLI had made. She referred to the campaigners as being passionate. We can also say that the RNLI is passionate, because day in and day out volunteers are out there saving people’s lives and collecting and raising the funds to do so. This is a difficult decision that has been made. What engagement do the Government have with the RNLI to ensure that the interests of the public are taken into account, so that the Government can assure themselves that the work it is doing takes public safety into account? That may allay some fears of those who are concerned about this decision, or who may be in a position to provide funding so that they do not have to make this decision.
Baroness Sugg
My Lords, lifeboat provision in the UK is delivered by independent charitable organisations that declare their lifeboats available to Her Majesty’s Coastguard. As I said, we are very grateful for their work. It is the responsibility of the organisations to decide on the specific operational capacity they consider appropriate, but of course the MCA works closely with the RNLI on the coastal review. The noble Baroness was quite right to pay tribute to the scale of volunteers in this area—it is extremely impressive. The Coastguard Rescue Service is made up of approximately 3,500 volunteers; the RNLI has 5,000 volunteer lifeboat crew; and, as the noble Baroness said, there are more than 23,000 volunteer community fundraisers. They all contribute to providing the excellent service on our coasts.
Ship and Port Security (Amendment etc.) (EU Exit) Regulations 2018
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Baroness Sugg
That the draft Regulations laid before the House on 21 November 2018 be approved. Considered in Grand Committee on 23 January.
Lord Berkeley (Lab)
My Lords, I have a very quick question on this one, to do with air pollution and the Merchant Shipping (Prevention of Air Pollution from Ships) Regulations 2008. This basically moves the responsibility for ensuring minimum air pollution from ships from the European Economic Area to the United Kingdom. I do not want to go into any detail at all, except to say that I hope the Minister can confirm the statement that has been made many times before by Ministers in this House—that when we leave there will be no reduction in environmental standards. I am particularly interested in:
“In Schedule 2 (engines excluded from regulation 21) … before ‘the European Economic Area’ insert ‘the United Kingdom or’”.
I hope the Minister can confirm that there will be no reduction in environmental standards from this change.
The Parliamentary Under-Secretary of State, Department for Transport (Baroness Sugg) (Con)
Again, I thank noble Lords for those questions. These regulations will make appropriate amendments to the existing ship and port security legislation, and will ensure that the current regime remains operable following the UK’s withdrawal from the EU. I confirm that there will be no reduction in environmental standards, and that this SI is needed only in the event of no deal.
Merchant Shipping (Recognised Organisations) (Amendment) (EU Exit) Regulations 2019
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Baroness Sugg
That the draft Regulations laid before the House on 12 November 2018 be approved. Considered in Grand Committee on 23 January.
The Parliamentary Under-Secretary of State, Department for Transport (Baroness Sugg) (Con)
My Lords, the next four Motions on the Order Paper were down to be moved en bloc but I am grateful to the noble Baroness, Lady Randerson, for her courtesy in advising me in advance that she wished to speak to one of them. I will therefore move the Motions separately. I beg to move.
Lord Berkeley (Lab)
My Lords, I will not delay the House for long but I have to question the point of this SI. It seems to try to ensure that we have the same safety regulations for passenger ships and many other things as we had before Brexit, this being a post-Brexit SI. But I do not think that we have the same regulations at the moment, because I happened to go on a passenger ship in Brittany last summer which looked exactly like what I thought would be a nice idea for a ship to go to the Isles of Scilly. I had a long chat with the skipper and got hold of all his certificates and the regulations on the board. I asked him, “Can you operate across the English Channel and to Scilly, in all weathers and at all times of day?” He said, “Yes—when do you want me to start?”
I thought this idea would be interesting, so I sent that information to the Maritime and Coastguard Agency but the answer that I got back said, “We do not recognise French legislation”. I thought that there was one common European system for ferries which could go across the English Channel, or anywhere else, to help interoperability so I was a bit distressed that this did not happen. Maybe the Minister will not be able to answer my point but I would be glad to have some response from her, perhaps in writing.
Baroness Sugg
I thank noble Lords for those questions. This first piece of secondary legislation is about the recognised organisations, which play a vital role in ensuring that ships are built and maintained so that they operate in compliance with standards for safety and to prevent pollution. The MCA delegates about 85% of its work to recognised organisations. These regulations will simply make changes to adapt an EU system for approving, monitoring and assessing recognised organisations in the UK system. I am afraid I will have to take the Scilly Isles point back to the department and look into that, and will come back to the noble Lord on it.
This is a no-deal SI. During an implementation period, the SI would not be needed because the withdrawal agreement will provide that EU law should continue to have the same effect. I fundamentally believe that it is important that as a responsible Government we continue to prepare for no deal. The long programme of statutory instruments is all about ensuring that we have a functioning statute book should we leave with no deal on 29 March. As long as that remains a possibility, we will need to continue the scrutiny of these SIs.
Merchant Shipping and Other Transport (Environmental Protection) (Amendment) (EU Exit) Regulations 2018
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Baroness Sugg
That the draft Regulations laid before the House on 27 November 2018 be approved. Considered in Grand Committee on 23 January.
Baroness Whitaker (Lab)
My Lords, exactly the same points apply about the protection of citizens.
Lord Foulkes of Cumnock (Lab Co-op)
Can I also ask in relation to this one if this is required only in the event of no deal?
The Parliamentary Under-Secretary of State, Department for Transport (Baroness Sugg) (Con)
My Lords, I confirm that this is another SI that is required only in a no-deal scenario. It makes changes to legislation on controlling sulphur dioxide emissions from ships, substances used to prevent the fouling of ships’ hulls, and transport and works legislation in relation to environmental impact assessment. It corrects deficiencies that would mean that environmental legislation did not work as intended. It is designed to ensure that we continue to maintain our high environmental standards.