Clause 7 - Imposition of Surcharges

Seafarers’ Wages Bill [Lords] – in a Public Bill Committee am 11:15 am ar 17 Ionawr 2023.

Danfonwch hysbysiad imi am ddadleuon fel hyn

Photo of Richard Holden Richard Holden Parliamentary Under-Secretary (Department for Transport) 11:15, 17 Ionawr 2023

I beg to move amendment 13, in clause 7, page 5, line 8, leave out subsections (1) to (4).

This is the first of a number of amendments and new clauses which, taken together, require harbour authorities to impose surcharges (as opposed to merely allowing them to do so) and set out the circumstances in which they must do so. The circumstances are related to the fact that equivalence declarations may be provided before, during or after the year to which they relate.

Photo of Philip Davies Philip Davies Ceidwadwyr, Shipley

With this it will be convenient to discuss the following:

Amendment 64, in clause 7, page 5, line 32, leave out subsections (5) and (6) and insert—

‘(5) The Secretary of State must by regulations provide for a national tariff of surcharges by which the amount of the surcharge is to be determined.”

Government amendment 14.

Amendment 50, in clause 7, page 5, line 33, after “regulations” insert—

“, where the minimum surcharge to be imposed on an operator where Subsection (2) applies shall be no less than 300 per cent of the difference between the amount calculated as the national minimum wage equivalence for the operator and the amount in total paid by that operator”.

Government amendment 15.

Amendment 51, in clause 7, page 5, line 36, leave out “specified by a harbour authority”.

Amendment 52, in clause 7, page 5, line 37, leave out “the authority” and insert “each authority”.

Government amendments 16 and 17.

Amendment 65, in clause 7, page 5, line 43, leave out paragraph (e).

Government amendments 18 and 19.

Amendment 53, in clause 7, page 6, line 1, leave out subsection (8) and insert—

‘(8) Monies collected by a harbour authority under this section must be transferred to the Secretary of State at a frequency of not less than twice per calendar year for disbursement towards the costs of shore-based welfare facilities for seafarers.”

This amendment would ensure that revenue from surcharges is passed to the Secretary of State for Transport rather than being held by harbour authorities and would direct UK Government spending to welfare facilities.

Amendment 54, in clause 7, page 6, line 3, leave out paragraph (a).

Government amendment 20.

Clause 7 stand part.

Government amendment 21.

Amendment 55, in clause 8, page 6, line 10, leave out “specified by a harbour authority”.

This amendment is consequential on earlier amendments relating to the surcharge.

Amendment 57, in clause 8, page 6, line 14, at end insert—

‘(2A) Any objection must be made to the Secretary of State within a length of time which may be specified by regulations. Any objection made after this time period will be considered void.”

This amendment allows the Secretary of State to set a time limit for any objections to be lodged.

Government amendments 22 and 23.

Amendment 56, in clause 8, page 7, line 1, leave out “to direct the harbour authority”.

Clause 8 stand part.

Government new clause 2—Imposition of surcharges: failure to provide declaration in time.

Government new clause 3—Imposition of surcharges: in-year declaration that is prospective only.

Government new clause 4—Imposition of surcharges: operating inconsistently with declaration.

Photo of Richard Holden Richard Holden Parliamentary Under-Secretary (Department for Transport)

I rise to speak to the Government amendments, the Opposition amendments, clauses 7 and 8 and Government new clauses 2 to 4.

As drafted, clause 7 empowers a harbour authority to impose a surcharge on an operator. The power applies in the event that the operator fails to provide an equivalence declaration under clause 3, or if it appears to the authority that the operator has committed an offence under clause 3(5). Where such a determination is made, the harbour authority may impose a surcharge on the operator on any occasion when a ship providing the service enters the harbour.

The amount of the surcharge is to be determined by a published tariff of surcharges set by the harbour authority in accordance with regulations made under the clause.

Photo of Grahame Morris Grahame Morris Llafur, Easington

On that specific point, I am sure the Minister can clear up the issue I want to raise. The surcharge relates to ports and harbour authorities competing with one another. Will the surcharge be consistent or will it vary from one port and harbour authority to another?

Photo of Richard Holden Richard Holden Parliamentary Under-Secretary (Department for Transport)

That will be clarified through the tariff regulations, which we will introduce. It will depend on the nature of the ship and the size of it, but we aim for consistency in terms of different vessels in different areas, and a tariff will be established.

The clause provides a power to make regulations that will make provision to—

Photo of Richard Holden Richard Holden Parliamentary Under-Secretary (Department for Transport)

I hope that what I am about to say will answer the hon. Gentleman’s question. The clause will make provision for publication of a determination to impose surcharges; set out how the imposition of a surcharge is to be notified to the operator; set out the period within and the manner in which a surcharge must be paid; and make provision for notification of a surcharge to the Secretary of State and publication of the fact that a surcharge has been imposed. Surcharges paid under the clause may be retained by the harbour authority for the delivery of any of their functions, or for shore-based welfare facilities for seafarers.

I turn to Government amendments 13, 14, 16, 17, 19 and 20. As with the Government amendments to clause 3, these amendments, along with the amendments introducing new clauses 2, 3 and 4, will make the previously discretionary powers of harbour authorities to impose a surcharge mandatory duties, and set out the circumstances in which these duties should be exercised.

As discussed in relation to clause 3, from our continued engagement with port stakeholders we have been informed that harbour authorities are unlikely to exercise their power to impose a surcharge unless directed to. The direction-making power was intended as a back-up power and was not intended to be used as the primary means. However, this is all part of addressing that issue and ensuring the effective functioning of the Bill.

New clauses 2, 3 and 4 therefore set out the circumstances in which a harbour authority is under a duty to impose a surcharge. In summary, new clause 2 sets out surcharges to be imposed when an equivalence declaration is not provided in time; new clause 3 sets out when a declaration relates only to part of a year; and new clause 4 sets out when a service is operated inconsistently with a declaration.

Amendment 13 amends clause 7 to remove the discretionary power for harbour authorities to impose surcharges, which is now replaced with the new duties set out in new clauses 2, 3 and 4. As a result, there is no need for regulations that make provision as to the publication of a determination to impose surcharges and that will be removed by amendment 17. Subsections 1 to 4 of clause 7, which are removed by amendment 13, are replaced by new clauses 2, 3 and 4, which provide for duties to impose surcharges and the circumstances in which those duties apply. Amendment 14 is consequential on amendment 13.

Amendment 16 provides that a duty to impose a surcharge is subject to direction-making powers of the Secretary of State under clause 11, as amended by amendments 32 to 34, to not comply with their duties or to comply with their duties in a particular way. I will discuss the powers of direction in greater detail when we come to clause 11. It also provides that a harbour authority that fails to comply with a duty to impose a surcharge is guilty of an offence and liable, as previously mentioned, on summary conviction to a fine not exceeding level 4 on the standard scale. As with the offence for not requesting a declaration, this will be enforced by the Maritime and Coastguard Agency and is essential to ensure that the Bill functions properly.

Amendment 19 provides for regulations to make provision requiring a harbour authority that has imposed a surcharge to notify the Secretary of State if the surcharge is not paid in the required timeframe. It is necessary for the Secretary of State to be aware of circumstances where harbour access is likely to be refused, in order to monitor the operation of the Bill, take steps to mitigate disruption caused by the refusal of access if necessary, which will be pertinent in relation to very busy sea lanes, and consider if a direction should be issued to the harbour authority under clause 11(2), as amended by amendments 32 and 33, in circumstances where the refusal of access might cause damage to key passenger services or national resilience. Amendment 52 is consequential on amendment 44 to clause 3.

This group of amendments also relates to clause 8 of the bill, which provides a process for the making of objections to surcharges imposed by harbour authorities under clause 7. As the Bill currently stands, an interested party may make an objection to a harbour authority’s determination to impose a surcharge, the tariff of surcharges specified by a harbour authority, or the imposition of a surcharge or its amount.

The Secretary of State will then consider the objection and any representations made and may decide to approve the decision to which the objection relates, or to direct the harbour authority to revoke the determination, revise the tariff, revoke the imposition of a surcharge, or increase or decrease the amount of the surcharge. The Secretary of State will communicate the decision to the harbour authority and the objector and publish it online.

The Secretary of State may also direct the harbour authority to repay any surcharges required as a result of a decision under this clause. If a harbour authority does not comply with a direction given by the Secretary of State under the clause, they will be guilty of an offence and liable on summary conviction to a fine not exceeding level 4 on the standard scale. It should be noted that where an objection has been made to a harbour authority’s determination to impose a surcharge, an interested person cannot make another objection to that same determination. I shall respond to other amendments as they are moved.

Photo of Mike Kane Mike Kane Shadow Minister (Transport)

I rise to speak in favour of amendment 64, in my name and the names of all Opposition and SNP members of the Committee. I am fascinated that Government Members often like to talk about the Laffer curve and the nanny state.

The Chair adjourned the Committee without Question put (Standing Order No. 88).

Adjourned till this day at Two o’clock.