Public Bodies (Marine Management Organisation) (Fees) Order 2014

Lord Greenway Excerpts

Wednesday 16th July 2014 Grand Committee

[The Parliamentary Under-Secretary of State, Department for Environment, Food and Rural Affairs (Lord De Mauley) (Con)]

My Lords, the order is made under the Public Bodies Act 2011. Section 4 of the Act enables Ministers to make an order modifying the funding arrangements of certain public bodies, including the Marine Management Organisation. The purpose of the order is to allow the MMO to charge for the monitoring, varying and transfer of marine licences.

The MMO is the principal regulator of marine activities around England and was created by the Marine and Coastal Access Act 2009. Its mission is to enable sustainable growth in our marine area, facilitating growth in coastal communities while protecting and enhancing the marine environment. Its responsibilities include the operation of the marine licensing system in English waters and the offshore waters of Wales and Northern Ireland.

Part 4 of the Marine and Coastal Access Act created the new streamlined marine licensing system for most UK waters. The system replaced the previous licensing system under the Food and Environment Protection Act 1985. A marine licence enables consistent decision-making about what activities are allowed to take place in the marine environment. Developments subject to a marine licence can range from small projects, such as the installation of buoys or the construction of small jetties, to larger harbour, dredging and wind farm developments. It is government policy to recover licensing costs where practicable. To a large extent, the Marine and Coastal Access Act and regulations made under it allow for the recovery of most of the costs associated with marine licensing. Indeed, the fee structure for marine licensing was updated and revised in April this year. This revision was designed to ensure that the calculation of fees more accurately reflected the actual costs incurred by the MMO.

However, the powers in the Marine and Coastal Access Act do not allow for the recovery of all the costs associated with monitoring, variations and transfers of licences. These costs were recoverable under the previous licensing system, and it was never the intention to omit them from the Marine and Coastal Access Act. The proposed order under the Public Bodies Act is therefore designed to close this particular funding gap. The order specifies that the MMO may charge a fee in relation to monitoring an activity authorised by a marine licence, the variation of an existing licence and the transfer and variation of a licence from the licensee to another person. The order specifies the level of the fees that may be charged. The basic principle is to charge applicants for the hours that are worked on a case, with the hourly rate fixed at £94. However, maximum ceilings will apply to simple variations or transfers, or the monitoring of non-complex cases. This is intended to provide greater certainty for smaller businesses and other operators. A different formula will apply in relation to the monitoring of disposal sites for dredged material. In these cases, the fee is calculated on a per tonne basis, up to a maximum of £15,000. This is because disposal sites are typically used by more than one operator and the MMO needs to have a method for apportioning the monitoring costs. Once in force, the order will increase the MMO’s income from marine licensing by about £600,000 a year. In the overall context, that sum of money may not appear huge but, in the context of the MMO’s budget of about £28 million and the focus on costs, it will make an important difference.

We have consulted on these proposals. As explained in the explanatory document accompanying this order, most respondents agreed with the overall principle and the need to recover costs. However, there were inevitably some concerns about the potential burden of regulation and the need for transparency and consistency in charging. We and the MMO are sensitive to the pressures on marine businesses and other users and have worked hard to remove unnecessary regulation and make the system work as efficiently as possible. This has included exempting low-risk activities, the use of longer licences for activities such as dredging and disposal, fast-track licensing for simple straightforward applications and the introduction of a coastal concordat to improve co-ordination of the consenting process for coastal developments in England.

I am grateful to the Secondary Legislation Scrutiny Committee for clearing the draft order within the 40-day affirmative procedure. In its consideration of the order, the committee agreed with the Government that in the longer term it will be desirable to rectify the deficiency in charging powers through an amendment to the Marine and Coastal Access Act. My department will continue to look for a suitable opportunity to do so in the future.

In summary, the Government consider that the approach set out in this order will provide a fair means of charging, a modest saving to taxpayers and an essential support to the MMO’s efforts in safeguarding the marine environment. To this end, I commend the order to the Committee.

[Lord Greenway (CB)]

My Lords, I thank the Minister for his explanation of the order, which I very much welcome. I chaired the joint pre-legislative scrutiny committee on the Marine and Coastal Access Bill. One of the concerns of the committee was the funding of the Marine Management Organisation. That was reinforced during the passage of the Bill through this House. As the Minister said, the Marine Management Organisation is still somewhat underfunded. This is especially so since Defra’s budget was cut. I think that what is proposed here is really a variation on the “user pays” principle. It is absolutely right that the MMO should be able to recover the full costs of varying or monitoring marine licences. In my opinion, the measure is very much to be welcomed. I think the Minister said that the MMO will gain to the tune of £600,000 a year and the taxpayer will be saved from paying that amount.