UK Maritime Industry

Debate between Drew Hendry and Pat Glass

Thursday 12th January 2017 Westminster Hall

[Pat Glass (North West Durham) (Lab)]

It is a pleasure to serve under your chairmanship, Mr Walker. This has been a very full debate, with many important contributions. I pay particular tribute to the right hon. Member for Orkney and Shetland (Mr Carmichael) for securing the debate. I was going to say that Opposition Members welcome it, but judging by the tone of the debate as a whole, I think it is welcomed right across the House, and I look forward to what the Minister will have to say at the end.

I would like first to give credit where it is due. I very rarely give credit to the Scottish Government, but I will on this occasion. I welcome the announcement by the Scottish Government of changes to the charter agreement for the two Seatruck vessels operating between Aberdeen, Shetland and the Orkneys.

However, I have to be fair: we have heard a lot about maritime companies paying less than the national minimum wage. On Scotland’s only commercial maritime freight link to the continent, the hourly rate paid to Lithuanian seafarers can be as low as £1.64. Justifiably, we get angry when we hear about modern-day slavery on ships in the far east harvesting prawns, but we are prepared to see £1.64 an hour paid within our own waters, so I think that although a great job has been done, there is much more to do.

[Drew Hendry]

The hon. Lady will of course be aware that that shipping route is in international waters and the Scottish Government have no locus over the pay rates of that company.

[Pat Glass]

I am simply pointing out that the company is operating in our waters and that we need collectively to do something about it.

We are an island nation, a net importer, and we are now leaving the European Union. We have the largest port sector in Europe in terms of tonnage handled and, as has been said, we have millions of ferry passengers every year. Our economic, social and security interests will depend more than at any time since the second world war on seafarers and a resilient UK maritime skills base. It is probably worth putting this in context. At the time of the Falklands war in 1982, the UK had a strong merchant naval sector; we employed 58,000 UK seafarers. That figure has now shrunk by almost 60% to 23,000. That is the context in which we are working.

Sub-national minimum wages continue to blight the lives of seafarers working on UK domestic and short sea journeys. I have seen figures alleging that at least eight operators along 11 short sea routes to and from the UK are underpaying more than 800 crew. In my own area, on ships crossing from Newcastle to Amsterdam, DFDS pays its staff £2.93 an hour—less than £3. I took a recent weekend trip to Amsterdam, which I really enjoyed, but quite honestly, if I had known that—well, I feel really uncomfortable about it. As a result of this debate, I will be writing to DFDS and other companies to say that it is simply not acceptable.

At present, passengers and businesses are travelling on Condor Ferries to the Channel Islands on vessels crewed by seafarers earning as little as £2.40 an hour. On freight-only ships, the pay is as low as £1.64 an hour. That is not acceptable. Prior to the national living wage increase for over-24s last April, it was estimated that 8,300 ratings were working the UK shipping industry for rates of pay below the national minimum wage. That was in April last year; the figure is now considerably higher than 8,300. Increasingly, companies are recruiting outside the UK to crew their ships with non-UK seafarers, particularly ratings, in order to profit from these sub-national minimum wage rates.

This is not a new problem. It has to be said that this goes well beyond the current Government. Beyond the simple injustices, we can see the cost of not having acted in the past. This legalised exploitation has systematically undermined maritime jobs in the UK, damaged the skill base and driven up unemployment rates in seafarer communities across the UK. Since 2011 alone, the number of UK ratings has fallen by 25%. If we end the pay exploitation in shipping, we can help to reverse the decline of our merchant navy. This need not be a party political issue, but one of sense, fairness and humanity.

There are three points that I would like the Minister to take forward from this debate. First, he has already committed to review the application of pay legislation across the shipping industry imminently. However, as we have already heard, that has already happened—the Carter review did it—so this is just a case of setting a timeframe and getting it implemented. Secondly, can the Minister give a date for when we can expect publication of updated guidance to HMRC on enforcement of the national minimum wage for seafarers? Thirdly, when will he publish the outcomes of the review of the existing protections in part 5 of the Equality Act 2010 against nationality-based pay discrimination for seafarers? That work was completed in April last year, yet 10 months later it has still not been published.

However, as we have heard, pay is only part of the problem and part of the solution. More than 70% of deck and 74% of engine ratings are now aged over 40. We are heading for a shortfall in trained and skilled seafarers. If we take no action, that will be filled by non-UK staff. The Select Committee on Transport warned over two years ago that the Government needed to act on funding, on approved standards for maritime apprenticeships, on the take-up of apprenticeships in the industry, on setting annual statutory targets for seafarer training and on including the number of trainee ratings in annual seafarer statistics. We would like to know from the Minister when we will get some action on that.

One area of maritime growth where the Government have not dragged their feet is on the recommendations to make the UK shipping register more commercially responsive, in the form of a Government corporation. I would gently point out to the Minister some other areas where this and former Governments have rushed to privatise—the rail industry, the energy industry and the water industry come to mind. Recent attitude polls among the electorate now show that the majority of our constituents—in some cases over 90%—want to see those decisions reversed, because they see formerly Government-owned, privatised industries making massive profits, but customers paying massive bills and getting a poor service. I would gently ask the Minister whether he will properly and carefully consider the costs and benefits of transforming the UK shipping register, fully consider all the options and also promise that this House will be given time to scrutinise those options?

Before closing, I wish to press the Minister on leaving the EU. At the moment we know nothing about the Government’s wider maritime priorities, at a time when we need a clear direction on maritime issues that would inform the Brexit negotiations. How will any changes to the single market affect shipping and seafarers? Will there be customs checks? Will there be tariffs? Is his Department feeding into the Brexit negotiations on these matters? If it is, will he tell us how?

In closing, I hope the Minister can elaborate on his Government’s plans for Brexit, or at least recognise that maritime is an exceptional issue that needs to take precedence. He must also assure the House about the future of the shipping register, along with the timeframe and process for any reforms. Will he outline his priorities for seafarer training and skills, and say whether he will set targets for recruitment? Finally, I look forward to him addressing the key point to come out of this debate about seafarer pay and conditions.