Wreck Removal Convention Bill

Earl Attlee Excerpts

Friday 13th May 2011 Lords Chamber

[Earl Attlee]

My Lords, I thank my noble friend Lady Stowell for the excellent way in which she introduced her Bill and mastered its technicalities faster than I managed to do. I suspect that she is still further ahead than I am. I listened with interest to all noble Lords’ contributions. It is, of course, for my noble friend Lady Stowell to answer most of the questions. I will answer questions that noble Lords put to me representing the Government.

This Bill enjoys the full support of the Government and I am happy to confirm that its provisions are compatible with the European Convention on Human Rights. It will improve our response to wrecks still further and, crucially, ensure that owners of ships are responsible for the costs of wrecks and the hazard they cause and that owners of larger ships maintain insurance to deal with those costs.

The noble Lord, Lord MacKenzie of Culkein, asked me about the other contents of the draft Bill. There are complexities, including the interests of the noble Lord, Lord Berkeley, with his Bill, and I will have to write to the noble Lord. I will place a copy of the letter in the Library and send a copy to all other noble Lords who have taken part in the debate.

The actions of ship owners and insurers are currently influenced by the value of what can be recovered, which means a significant proportion of the costs associated with locating, marking and removing wrecks continues to be met by the taxpayer. The costs of dealing with individual incidents can also vary considerably depending on such things as the size of the vessel and the nature of the cargo. For example, the cost to the Government of dealing with the container ship MSC “Napoli”, mentioned by the noble Lord, Lord Berkeley, which was beached in Branscombe Bay in 2007, was approximately £2.7 million, of which only £1.3 million will be recovered by the Government. However, the costs are not usually that high. Based on a 10-year average and with a cost recovery of approximately 70 per cent, depending on the circumstances, the annual cost as things stand is around £500,000. When the convention is ratified and enters into force in the United Kingdom, that cost is expected in practice to fall to just £40,000, a potential saving of £460,000 annually to the taxpayer.

The Bill would enable the United Kingdom’s authorities to recover their costs from the ship owner, who has primary responsibility for removing the wreck, or from the insurer directly. The Bill does not prevent the general lighthouse authorities or the harbour and conservancy authorities from acting in exercise of their existing powers for dealing with hazards that are a threat to navigation or to lifeboats, but it does provide the means, in cases where they have been directed by the Secretary of State, to recover costs which are not recoverable under the present arrangements.

Of course there can be no absolute guarantee of full cost recovery, so on the rare occasion that there is a shortfall, these costs will have to be met from elsewhere. In this regard, it is important to understand that the Bill maintains the status quo. For the general lighthouse authorities this will be through the General Lighthouse Fund, for the harbour authorities through harbour fees, and for the Maritime and Coastguard Agency the taxpayer. This is no different from the current methods used to make up any shortfall in expenditure by these bodies when carrying out their statutory obligations for dealing with hazards that are a threat to navigation or to lifeboats.

The noble Lords, Lord Berkeley and Lord Davies of Oldham, expressed a concern that any shortfall in costs incurred by these bodies would place an additional financial burden on the GLF and the financial reserves of the harbour and conservancy authorities. With the Bill imposing strict liability on the ship owner to remove a wreck, and by requiring mandatory insurance, the Government are of the opinion that the risks of a shortfall in expenditure will actually be significantly less for these bodies than they now experience.

The noble Lord, Lord Bradshaw, asked me whether the Government would stand behind the GLA. As I have just said, the situation will be much better for the authorities when the Bill comes into force. Historically, the cost of handling wrecks has been a small proportion of the GLA budget, a point made by the noble Lord, Lord MacKenzie. As a proportion of its budget the costs of wreck handling, excluding the costs of the SM “UB-38”, is only 0.004 per cent. If the exceptional costs of the SM “UB-38” are included, the percentage rises to 0.32 per cent. So we are talking about a very small proportion of the total budget of the GLA. He also asked how sure I could be that ship owners would hold valid insurance, while the noble Lord, Lord MacKenzie, raised a point about port state control visits under the Paris MoU. Our port state control visits are targeted, as are those of other states. We acquire information from a variety of sources. As to the UK fleet of over 300 tonnes, there are only 1,200 ships, so it is easy for the MCA to monitor them and ensure that they are insured. Further, the certificates are authenticated by Governments, which for the UK is the MCA. There is a difficulty as regards passing ships not calling at an EU port, but the situation will be no worse than it is now.

Returning to the point made by the noble Lord, Lord Berkeley, I would also stress that the Secretary of State’s powers of direction are discretionary, so these bodies will not necessarily be instructed to locate, mark and remove every hazard. The noble Lord told us the amusing story of the rubber ducks in the Pacific Ocean, but the convention is not applicable to them because they are not a danger to navigation or harmful to the marine environment. In exercising these powers, the SOSREP—the Secretary of State’s representative—who can take charge in such situations, would be expected to have full regard to the capabilities of the directed authorities. Indeed, there would be no point in directing those bodies to undertake tasks for which they did not have the capability or experience, a point made by the noble Lord, Lord Greenway. The noble Lord asked me whether I could go a little further on this. I do not think that I can at this point, but I can assure your Lordships that the arrangements will be made clear in a memorandum of understanding between the respective parties to ensure that they are aware of their responsibilities and that wrecks are located and marked as soon as practicably possible, whether or not the wreck is a hazard to navigation. It is intended that this memorandum of understanding will be agreed between respective parties prior to entry into force of the convention. The noble Lord suggested that we examine these points in Committee. I am sure that my noble friend Lady Stowell will be able very competently to deal with them.

I hope that the House will recognise the considerable benefits that this Bill will bring to those bodies that already do such an excellent job in keeping our waters safe. To that end, I join my noble friend Lady Stowell in commending it to the House.