Amendment 1

Seafarers’ Wages Bill [HL] - Report – in the House of Lords am 3:53 pm ar 26 Hydref 2022.

Danfonwch hysbysiad imi am ddadleuon fel hyn

Lord Berkeley:

Moved by Lord Berkeley

1: Clause 3, page 2, line 15, leave out “the harbour” and insert “a harbour in the United Kingdom”

Photo of Lord Berkeley Lord Berkeley Llafur

My Lords, I declare my interest as honorary president of the UK Maritime Pilots’ Association and a former harbour commissioner for the port authority in Cornwall.

In moving Amendments 1 and 2 I will reflect on the purpose of the Bill. Although it was created, as Ministers have said, to avoid a repeat of the frankly disastrous attempt by P&O Ferries earlier this year to change all their seafarers, it was the process that I felt was abhorrent. Clearly, the purpose of this Bill is to ensure that the national minimum wage legislation applies to all seafarers when working in UK waters but not within the UK.

We debated the two issues in Amendments 1 and 2 in col. GC 102 of the Grand Committee on 12 October. I would like to start on Amendment 1, which is linked to Amendment 2. The question is: what is a harbour?

My Amendment 1 would leave out the words “the harbour” and insert

“a harbour in the United Kingdom”.

We understood what the Minister told us in Committee, but then it got a bit confusing. She kindly wrote a long letter to us, which was helpful, but she said in the letter:

“A service is defined … as being ‘for the carriage of persons and goods by ship, with or without vehicles, between a place outside the United Kingdom and a place in the United Kingdom’”.

The word “a” is interesting. If it were “the”, as in the Bill, that would be just one harbour, but my argument is that “a” place can be any harbour. This comes into the scope of whether the Government are trying to protect all seafarers who are, shall we say, based in the UK—those who work in UK waters but are not necessarily employed on UK land—or whether this provision just sorts out the P&O Ferries problem. It is my contention that as the Minister referred in her letter to “a” place, that is what should be in the Bill.

I also want to explore why this needs to be confined to Dover to Calais. Many noble Lords will recall that a previous Secretary of State for Transport, Chris Grayling, created a new ferry service between Ramsgate and Zeebrugge to try to sort out the traffic jams at Dover. Of course, that ferry service did not actually exist; I discovered that the head office was in an office owned by a very large manufacturer of construction equipment in the City, but there was no ship or ferry. But Ramsgate is a perfectly good ferry terminal and I can see that ferries might operate between Dover and Calais one day and between Ramsgate and Calais the next; it could effectively be the same service. It is not right to confine the service included in the Bill to just one service, when ships can go round the country. I believe that the seafarers, in all these things, need similar protection.

We then move on to the question of having 52 or 120 days a year where the ship would have to come into a UK port in order to be included under the Bill. Ministers have said that the key is that the service must have close ties to the UK. I suppose I would question how you can define close ties—it is a bit of a woolly concept. I am not going to give any examples, but if you are a seafarer and want to be included, you might wonder whether the company employing you has those close ties. It is a difficult question to answer.

I am grateful to the RMT trade union for some information it has sent to me and, I expect, many other noble Lords. There are two issues here. Is there a need for this when you are operating a ferry service to a close member state of the European Union such as France, the Netherlands or the Republic of Ireland, where maybe the national minimum wage is higher than what we pay here? The argument may be that it is not really important. But this is legislation that could be on the books for many years and most countries could change their policies, so it is as well to make this applicable to many countries—member states and other reasonably close places—rather than saying that we do not need to bother with France because its pay is high anyway.

More interestingly, rather than just talking about Dover/Calais, the RMT has given me a list of services and vessels which go to and from the UK and could well meet the 52-visit figure I am proposing; the Government would rather have 120 visits. I have counted and there are 34 vessels and routes, not just one or two. I shall not read them all out. There are probably seven or eight different operators: P&O is a big one and there are DFDS, Stena and Cobelfret. We all know them. Some pay very well and, according to the RMT, some pay very badly. The lowest I have seen is Condor Ferries, which pays £2.40 per hour. That is a little bit below the national minimum wage, is it not?

It is difficult and dangerous to try to limit this legislation to services which are a bit like Dover/Calais. If you are a seafarer on many of those 40 or so services, the same comments and worries apply to you all. This applies only within UK territorial waters; what happens outside is a separate issue. That is why I have tabled Amendment 2: to reduce the number of visits of a ship or a service from 120 to 52. We can debate whether 52 is the right number—that is one a week on average—but it means that we can include a much greater range of services for which seafarers deserve to be treated properly. That includes cruise ships. Why should people on cruise ships not get paid a national minimum wage? I shall not go into detail—there is another amendment that could have come in—but the key is that the 52 visits a year can be measured. That can be controlled and I think it is a much better number than the 120 in the Bill.

In moving and speaking to these amendments, I look forward to the Minister’s response to Amendment 1 on whether option A or option B on harbours is favoured. It will be very interesting but I think the key is the 52 visits in Amendment 2. I very much look forward to what the Minister has to say and then I will decide whether to seek the opinion of the House. I beg to move.

Photo of Lord Forsyth of Drumlean Lord Forsyth of Drumlean Ceidwadwyr 4:00, 26 Hydref 2022

My Lords, I declare an interest as a director of J&J Denholm, which has shipping and port services interests. I have not participated in this Bill because I thought it was excellent and doing the job that Ministers made clear was its purpose, which was to prevent a recurrence of the appalling behaviour of P&O in its ferry services. That was declared at the time.

We are looking at the provisions in the Bill and the suggestion in Amendment 2 that we should leave out 120 and insert 52. I believe that P&O has something like 15 crossings per day between Dover and Calais, so the Bill clearly deals with the problem that it was presented as seeking to solve. I am not unsympathetic to the points made by the noble Lord, Lord Berkeley, who is splendid and very careful in the work that he does in this House. Indeed, we have agreed on matters such as HS2 and others from time to time. But his amendment would completely change the Bill’s scope, and to do that on Report would be quite ridiculous, when the whole thing has been presented to the public.

I am intervening because of representations from the Chamber of Shipping, which accepts that the Bill is right and the number 120 is right, but is concerned that we are drawing in other services. I have no idea what those services are and the noble Lord did not say what they were; I have no idea what the implications and costs are for the administration of the ports and so on. What I do know, however, is that it is not what the Bill was introduced to deal with. Therefore, at this late stage, it would be wholly inappropriate to amend the Bill in this way or to create an unknown administrative burden on the ports.

I guess that the noble Lord chose the number 52 because it meant once a week, but that does not address the problem that has occurred, so I hope my noble friend will continue to resist the amendment. The noble Lord seems to me to be in danger of trespassing on international conventions and rules. The Labour Party has always been a great supporter of the ILO and so on, and of having an international approach. We must tread with care. The Government, in seeking to deal with the P&O episode, took a step in a direction that moved away from the conventions that the flag of convenience should govern the rules on board ships, which was entirely justified. But this amendment is a step too far. As it is Report, I shall say no more.

Photo of Lord Balfe Lord Balfe Ceidwadwyr

My Lords, I have a lot of sympathy with what my noble friend Lord Forsyth has said. We have set out to deal with the problem of P&O. I have heard nothing from the RMT—it is clearly not that bothered about this side of the House—but this pushes things a bit further than they should go. I hope the noble Lord will not test the opinion of the House.

Photo of Lord Greenway Lord Greenway Crossbench

My Lords, I very much endorse what the noble Lord, Lord Forsyth, just said. I am very concerned about this amendment, as is the Chamber of Shipping. The Bill is part of the Government’s nine-point plan to address the whole problem of seafarer welfare—an important one nevertheless, dealing with services with close ties to the UK, making regular port-to-port international voyages adding up to 120 calls a year. It is not just about Dover/Calais; ports all around the country will be affected, so it is wrong to concentrate just on Dover/Calais, although admittedly that is where the main problem occurred.

The Government went through extensive consultation on the Bill and came up with the figure of 120 calls a year, which is probably the right balance. I know that the chamber is very concerned that widening the scope of the services affected to those making only a single call a week would draw in a very large number of non-UK ships, subjecting many more foreign companies to UK national minimum wage legislation. In turn, that would provoke a severe reaction from the international shipping community—and I know that the International Chamber of Shipping is especially worried about this. In turn, this could be seen as an even greater infringement of international conventions and an excessive claim to prescriptive jurisdiction.

It would also be impractical for the Government to oversee such a large and diverse number of shipping services calling at UK ports, increasing the administrative burden on ports, as has already been said, and creating uncertainty across different shipping sectors such as coastal, wet and tanker services, dredgers and other services that were never intended to be part of this Bill. Any decision to have a scope in the Bill that is way beyond the original stated intention will seriously damage confidence in the UK as a global centre for shipping; it also risks fewer ships calling at UK ports.

My noble friend Lord Mountevans has taken a greater part in this Bill than I have, so in many ways I am speaking for him. I say to the noble Lord, Lord Berkeley, who is a good friend, that no cruise ship would be affected by this amendment, because cruise ships do not call that frequently and most of them migrate during the winter months. So, I do not think that the effect of his amendment would be as great as he might have hoped, and therefore I hope the Government will resist it.

Photo of Baroness Randerson Baroness Randerson Liberal Democrat Lords Spokesperson (Transport)

My Lords, I want to start by thanking the noble Lord, Lord Berkeley, for his usual attention to detail on these issues. The noble Lord, Lord Forsyth, said that he had not participated before. If he had, he would know that the scope of the Bill has been a persistent topic, and those of us who have been engaged throughout have pressed the Minister on a number of occasions, and in a number of ways, to define it more closely. I am particularly interested in Amendment 2; the key point here is the reduction in the number of visits required to demonstrate close ties and regular links with the UK—the noble Lord has suggested a reduction from 120 to 52.

The argument against that is that it might bring in a new range of services, and I understand the Government’s desire to avoid mission creep. But the truth is that although we all agree with the principle of this Bill—that seafarers should be paid a decent wage—in practice it is very poorly drafted. It has imprecise definitions, penalties that are in practice not going to be imposed—such as the denial of access to the harbour, which will come up in an amendment later—and a very cumbersome structure whereby the Government will rely on harbour authorities to implement the rules. I believe it would not have got this far in its current state if the Government had not been so distracted recently; we are after all on the third Secretary of State in three weeks, and it is difficult to get that continuity.

To address the specific issue of the numbers, the noble Lord suggests that the total is 52. It is easy, as the noble Lord, Lord Greenway, has just pointed out, to base one’s judgments on what happens from Dover; in practice, there are ferry services in the rest of the UK that are in every way similar in structure, ownership of the company and the seafarers involved, but they go much less frequently. It is possible to envisage, for example, some of the ferries between the north of England and Scandinavia and ferries between the south-west of England—maybe Poole—and the north of Spain. Those are regular ferry services that often do not run at all in winter, so a total of 52 may not be out of kilter with what is required.

In the interests of fair wages, it might be worth broadening the definition. I urge the Minister to consider that, and to look, even at this late stage, at the pattern of services throughout the UK. There may well be a case to reduce the total number of services which are caught in the Bill.

Photo of Lord Hendy Lord Hendy Llafur 4:15, 26 Hydref 2022

My Lords, I support both my noble friend Lord Berkeley’s amendments. They make it more likely that operators will not be able to evade their obligation to pay at least the national minimum wage equivalent. The behaviour of P&O Ferries in March this year is the very reason for the Bill, and that behaviour shows the lengths to which operators will go to save money on seafarers’ wages. The Bill should bend over backwards to narrow every opportunity for operators to evade their very modest obligation to pay seafarers the national minimum wage equivalent and prevent such behaviour.

It is not just P&O Ferries. The effect of allowing ship operators to evade the national minimum wage equivalent is that they undercut their competitors, which then join the race to the bottom and put at risk the jobs of some 2,000 UK-resident ratings and officers. Like my noble friend Lord Berkeley, I looked at the table provided by RMT. Perhaps he will forgive me giving a correction: he said that the lowest rate was £2.40, paid by Condor Ferries. However, according to the table, the lowest rate is P&O Ferries on the “Pride of York”—a vessel registered in the Bahamas—on the Hull-Zeebrugge route, which pays €2.04 per hour for cooks of Lithuanian extraction. There are a number of other low rates. For example, DFDS’s “King Seaways”, going from Newcastle to Ijmuiden, is on the Danish international ship register and has Polish, Ukrainian, Romanian and Filipino crew, and it pays $2.63 an hour for a cabin steward. I will not read any more examples, but this appears to be a perpetuation of nationality-based discrimination on pay which this legislation should be tight enough to avoid.

I hope the Minister will forgive me for asking before I sit down for her to clarify a point raised in Committee—namely, whether a harbour in one of the Crown dependencies is a UK harbour or whether it will become subject to a national minimum wage equivalent corridor. I did not understand the answer she gave in her very kind letter of 21 October. If it is to become the subject of a corridor, can I ask how negotiations are progressing, and whether they involve the social partners?

Photo of Lord Tunnicliffe Lord Tunnicliffe Shadow Spokesperson (Defence), Shadow Spokesperson (Treasury), Shadow Minister (Transport)

My Lords, to make some general comments, we welcome the Bill. I think everybody has been shocked by P&O’s behaviour, but this goes a bit deeper than that. I had no idea how badly seamen are paid. It is disgraceful. This is clearly a worldwide problem, and there are problems with addressing it from a singular point of view.

I also object to the criticism of my noble friend by the noble Lord, Lord Forsyth, because this has been a normal Bill. We could not vote in Grand Committee for the usual conventional reasons. It was well debated—the noble Lord would know that if he had been present. Essentially, Amendment 2 is a judgment about degree, and we come to a different judgment than the Government. While we support the Bill in general, we have amendments where we think that a little finesse will make it more effective. A weekly service is the sort of thing that should be within the scope of the Bill. While we will not press Amendment 1, we will support the noble Lord if he wants to press his Amendment 2 to a Division.

Photo of Baroness Vere of Norbiton Baroness Vere of Norbiton Parliamentary Under-Secretary (Department for Transport)

My Lords, I am very grateful for all contributions on this first group. I appreciate the support from Members on my own side; it is always good for the Minister to know that there are a range of views and that people are thinking about the Bill and taking it seriously—it is a very serious Bill.

The noble Lord, Lord Tunnicliffe, mentioned the welfare of seafarers. He is absolutely right and there are mechanisms, which the UK is deeply embedded in and has been for a very long time, which work internationally, as many noble Lords will know, to try to improve the conditions and pay of seafarers. However, that is not under discussion today. As pointed out by the noble Lord, Lord Greenway, this is an important part of the nine-point plan that Ministers set out earlier in the year, but the Bill is narrow in scope and effect. That is for many reasons but a key one is that we have to be mindful of the extent to which we are legislating; we have to be mindful that we do not overreach, because that might have some very serious unintended consequences that we would later regret. That is why, throughout the drafting of the Bill, we have had at the front of our minds not only international law but our international obligations; that is critical. Although I accept that there are many things that noble Lords would very much like to do for seafarers—and that, probably, on the face of it, I would like to do too —the reality is that, as a Government, we have to be sensible and potentially a bit boring. We must stay in our lane and make sure that we do not overreach, because the consequences would be very significant.

There are two amendments in this group. The first brings back the old chestnut of “the harbour” versus “a harbour”. I am grateful to the noble Lord, Lord Berkeley, for enabling that discussion once more. I cannot go much further than I went in Committee; I just state that it is absolutely important that unless we say “the harbour”, we cannot define what a service is. A service is from one point—the point—to another point. It is of great regret that the word “a” crept into the letter, but noble Lords can imagine that that was the overarching ambition: from a point overseas to a point in the UK, but “the harbour” within a place overseas and a place in the UK. Because we have defined it that way, from “the harbour” to “the harbour”, we capture the high-frequency services that, let us recall, can be serviced by any vessel—you can put another vessel in when one is off being maintained or whatever—but it is always between two specified harbours.

The second part of that definition—the harbour to the harbour—that is very important is

“120 occasions in the year”.

That, essentially, defines a service that has close ties. The second point about this is that unless you define it as “the harbour” to “the harbour”, it would be incredibly difficult to enforce the Bill, because the Bill relies on one harbour authority being responsible for monitoring and enforcement. Individual harbours may be able to anticipate that a particular service will call in its harbour 120 times a year, perhaps because that service has been doing so for years, if not decades. That harbour authority may not be able to anticipate whether a particular operator has services to other ports, so how would the enforcement and monitoring work in those circumstances?

The noble Lord, Lord Berkeley, brought up an example about, I think, a former Transport Secretary and ships that could be brought in to operate services, but he reinforced the point I am trying to make: it is not about the ships or the specific seafarers on a particular service; it is the service itself that we must make sure falls within the Bill’s scope.

I am content that we have defined the scope well. I am a little disappointed that I have not given sufficient explanation such that the noble Baroness, Lady Randerson, is content, but I feel that we are there and have clarified exactly what would happen. In response to concerns raised about services suddenly deciding to go to another port so that they do not have to pay seafarers a fair wage, as I said in Committee, I do not think that would be commercially viable. I do not think operators would play switcheroo with UK ports because, frankly, their customers would not put up with it. I do not think that point works.

I hope the noble Lord will withdraw the amendment to change “the harbour” to “a harbour”. It would make the entire Bill not worth the paper it is written on, and it would not function in the way that I know the noble Lord wants it to function.

I turn now to Amendment 2, which seeks to decrease the threshold frequency from 120 times a year to 52. The figure of 120 was arrived at following very thorough and extensive consultation and bilateral discussions with industry and other stakeholders. We have looked incredibly carefully at the patterns of services, noted by the noble Baroness, Lady Randerson, and at maritime traffic data by type to reach the figure in the Bill. The scope of the Bill captures services calling 120 times a year on purpose. It is a very specific number that balances the need to maintain close ties with wanting to do the very best we can for seafarers.

The rationale is clear. It covers the vast majority of passenger ferries, including ro-pax, non-passenger ferries and ro-ro services calling at the UK. Critically, it focuses the Bill on short sea services, which justifies the connection to the UK and therefore the UK-equivalent level protection of pay. We do not want to bring into scope some of the high-frequency deep sea container services. That would not be our intention at all and, as my noble friend Lord Forsyth mentioned, would completely change the scope of the Bill and would go against the Government’s intention.

For the UK to impose pay requirements for seafarers on foreign-flagged ships that call at its ports only once week would risk being seen as an overreach by international partners. It would weaken the justification for the UK taking legislative action. As my noble friend Lord Forsyth said, we must tread with care. I appreciate that the noble Lord’s intention is to protect as many seafarers as possible, but the Government can justifiably legislate only for those with close ties to the UK. To seek to do more could risk making the Bill inoperable and could damage the UK’s reputation internationally.

Photo of Lord Berkeley Lord Berkeley Llafur

My Lords, I am grateful to all noble Lords who have taken part in this short debate and to the Minister for her reply. To some extent, these issues were discussed in Committee and many of us suggested to the Minister that there were questions, which the Chamber of Shipping has clearly raised with other noble Lords, about the legality of this from an international shipping point of view. The Minister convinced us—well, she said there was no problem and she thought it would be all right and within scope. The only difference, therefore, is how many times a service goes into a port before it ceases to cause an international problem? I do not know the answer to that, but I cannot believe that, if it is all right to have 120 visits a year, it is somehow illegal to have 52.

The noble Baroness also raised the question of foreign-flag ships. I thought we had established that it applied to any ship, regardless of what flag, so I do not think the foreign flag comes into it at all.

I am grateful to my noble friend Lord Hendy for setting out in more detail what the RMT has sent us, but seafarers who are operating on a service where the cook gets paid £2 an hour might look askance at sea- farers who are getting the national minimum wage because they happen to be going on a short sea crossing where P&O had caused some problems earlier this year. It does not seem logical to me.

Assuming therefore that the Government believe that the purpose of the Bill is legal under international law—I have to take that as read—it seems to me pretty unfair that some seafarers are going to benefit and some will not. I am sure that is not what was needed or wanted by the Government and I am sure that there will not be too many unintended consequences. It is quite possible to monitor which ships go into which ports and where, and I know the MCA and the Government can do it.

My real purpose in this amendment was to try to support seafarers who work around the UK and make sure that they are all subject to the same national minimum wage. We cannot have a few exceptions, just because a service happens not to go into a port quite so frequently.

Finally, on the question of increased costs if wages go up—we know that is why P&O did what it did, and no doubt others will try to follow—I do not think the evidence that increasing the minimum wage on certain ferries will suddenly put the UK out of business is credible. There are many other reasons—which I will not start debating now because other noble Lords will want to debate them as well—but the question of cost is something which P&O tried, and I expect won, and we do not want to see it again. It must apply to all ships which may come into the UK, as defined in the Bill, at least 52 times.

I am grateful to all noble Lords who have spoken, and I would like to withdraw Amendment 1.

Amendment 1 withdrawn.