Competition Act 1998 (Coronavirus) (Public Policy Exclusions) (Revocations) Order 2021

Debate between Lord Bassam of Brighton and Lord Teverson

Monday 1st November 2021 Lords Chamber

[Lord Teverson (LD)]

My Lords, what a privilege it is to have the noble Lord, Lord Callanan, with us this evening. With COP 26 happening in Glasgow, the Minister for Energy Efficiency, Fuel Poverty and Clean Heat is among us. In fact, maybe I should apologise that we have detained him from saving the planet. I hope that he will be able to give us a brief insight into COP 26 and his role in it in his answer to the very good questions asked by noble Lords and my noble friend Lady Randerson.

What I thought was more of an irony about this order is that it mentions the Competition Act 1998 (Groceries) (Public Policy Exclusion) Order 2020, whose time has, I think, already expired. The irony is that the thing which the groceries order was set up for—Brexit and Covid—was not a problem at the time, but now we actually have a crisis. A number of the supermarket shelves are empty, we do not have HGV drivers and supply chains are failing, so maybe we should look at that. We have now allowed cabotage, and drivers’ hours have been extended. It is mentioned here that we have more of an emergency, particularly perhaps as we approach Christmas, than we would do otherwise.

I want to say a couple of things about the Isles of Scilly—not the Scilly Isles, as they are very different places, one fictional and one real. First, I want to thank the Government for the £48 million that has been attributed through the levelling-up fund, as mentioned by the noble Lord, Lord Berkeley, to sorting out the next generation of vessels and the port structures that support them for travel between Penzance, which I visited over the weekend, and the Isles of Scilly—and between those islands as well. That very important commitment allows a change from the current “Scillonian” and freight vessel, which are well out of date and will cause problems into the future. I do not dispute in any way the questioning of the noble Lord, Lord Berkeley. He knows far more about ferry configurations than I would, but we should note specifically and positively the Budget Statement in that area.

I am also a supporter of competition, in principle, because it is important whether you do it through procurement of a contract to run a service—perhaps on a TfL basis—or in the form it takes on the Isle of Wight, which perhaps does not work exactly correctly, where there is competition between operators. That is important, but what we have with Scilly is always the cost and uncertainty of the connection. We always looked at Scotland as having a far better approach to remote communities off our islands, while in England we find, off Cornwall, that the Scillies are discriminated against.

I looked up the cost of flying by helicopter, which is a form of competition. For those who wish to visit—and I hope you do—the price for a single adult to fly to Tresco or St Mary’s is £129 one-way. If you are lucky enough to be an infant aged between two and 11, it is only £108. That gives an indication of the cost of that second-rate transit for members of the British Isles community. They are second in a league to our friends north of the border.

I reiterate that I wish the Minister every success at COP 26. I am sure he will be there in his energy roles. This conference is the most important we have had on the planet, and I give all good wishes to the Government, and Alok Sharma, in achieving success at it. I also thank the Government for the recognition of the Scillies issue in the Budget.

[Lord Bassam of Brighton (Lab)]

My Lords, first, I thank my noble friend Lord Berkeley for securing today’s debate via his Motion of Regret, which clearly comes from a good place—designed, as it is, to protect consumers from high prices and to keep ferry routes accessible to all. The debate has generated more heat than I expected, but it is important because in our communities at the periphery, there is a strong sense that they suffer from high prices, are forgotten because they are at the end of the line, and get left out in government considerations. I join my noble friend Lord Berkeley, the noble Lord, Lord Teverson, and the noble Baroness, Lady Randerson, in thanking the Government on behalf of the Isles of Scilly for their £48 million contribution to improving the quality of the sea services to those islands, because what is there at the moment is clearly not fit for purpose and needs to be improved. It is a lifeline service and helps the tourist economy of those islands.

As we heard, in March 2020, the Government announced that ferry services to and from the Isle of Wight were at significant risk of disruption due to the pandemic, so they introduced regulations which allowed the two ferry operators to share information and staff to ensure that ferries continued to run regularly across the Solent. That was for all the reasons and purposes that noble Lords have outlined: for economic, health, education and welfare reasons.

Now, of course, the Government have decided that the Covid pandemic is at an end and seem to think it is the right time to end the suspension of competition law, believing it is no longer needed. I do not know that the pandemic is at an end: the figures tell us otherwise. People are getting Covid at the rate of about 40,000 a day, and about 1,000 people a week are dying from it, so I am not sure that we are at the end of it. People are still very cautious in their travel plans for that very reason. The absence of people travelling means that those services could be under threat in future. I do not buy the line that there is no more threat of severe disruption to the Isle of Wight ferry crossing services.

Can the Minister explain how the Government reached the conclusion that now is the right time to end the Covid provisions? Although I am not a local of the Isle of Wight, it is a place that I have visited on many occasions. I think the first time I went there was in 1970, to a pop festival. Back in those days, Sealink, a nationalised industry, ran the service. It was a very good and very cheap service, actually, by the standards of the time. As a Brightonian, I am familiar with the ferry service: it goes from just down the road in Newhaven, along the coast from the Isle of Wight. It strikes me that ferry prices there are quite expensive. Ironically, my wife recently used the service and complained to me about it. I can understand how local people who have to make multiple journeys for work, health, education and other purposes see their ferry ticket prices adding up and becoming a serious expense and, by default, an inhibition on business on the island. I must acknowledge that there is genuine concern from some that there is insufficient competition.

I think that my noble friend Lord Berkeley said that there were two monopolies, and I think that is probably a fair description of how it works, and that that has undoubtedly resulted in high fares. I suspect that the companies see those two services, in particular, as providing a regular flow of income that they can pretty much rely on. Does the Minister think that fares are too high? Clearly, local people do. That is reflected in the attitude of the local MP and local councillors. Are there too many barriers to entry to new ferry companies, I wonder?

It has been reported that an island-based consortium may well be working up a plan to run a community vehicle ferry service and has asked the local council for its help. Are the Government planning any additional support for such a move? Do they see that it has a role in stimulating some genuine local competition? If they do, I suspect there will be quite a lot of takers for that service, given the high cost of the service as it currently is.

So are the Government planning to ensure that there is real competition? Do they accept that services are expensive? What comfort can be offered to the community of the Isle of Wight in ensuring that ferry services can be provided in future at a reasonable price?