Select Committee on Environment, Transport and Regional Affairs Appendices to the Minutes of Evidence


Memorandum by the Port of London Authority (P 18)

  1.  The Port of London Authority ("PLA") welcomes the opportunity to make this submission to the Environment, Transport and Regional Affairs Committee (the "Committee") following the publication of the Government's document, Modern Ports: A UK Policy.

INTRODUCTION

  2.  The PLA is a self-financing public trust created by Act of Parliament to improve and conserve the tidal Thames. As an important part of the provision of harbour services, the PLA regulates navigation on the tidal Thames.

  3.  There are currently 73 working cargo wharves and terminals on the tidal Thames, all of which are in private ownership, the most significant being Tilbury, owned by Forth Ports Plc (10 million tonnes of cargo in 1999), and the BP Oil Refinery at Coryton, (12 million tonnes pa). Total tonnage was 52.4 million tonnes in 1999, maintaining the Port of London's position as the UK's largest port, with a market share of 9.2 per cent of all UK seaborne trade.

  4.  The prime service the PLA provides is to facilitate the safe navigation of vessels within its area of responsibility, which extends in the east from a line drawn between Clacton-on-Sea and Margate to Teddington in the west, a distance of some 100 miles.

  5.  The PLA discharges this duty by:

    —  providing a pilotage service;

    —  maintaining access channels;

    —  monitoring and directing vessel traffic from its two navigation control centres;

    —  making Byelaws and Directions;

    —  enforcing regulations through its Harbour Service patrol launches;

    —  providing and maintaining navigation aids (buoys and lights);

    —  making available navigation and tidal data to all mariners;

    —  inspecting and registering craft; and

    —  licensing river works.

  6.  The PLA investigates all reported navigational incidents, including oil spills. Where serious breaches of the PLA Act, its Byelaws or Directions occur, and where there is sufficient evidence to justify a prosecution, legal proceedings are undertaken. The PLA endeavours to be firm but fair in this regard.

  7.  As an independent public trust, whose independent board members are appointed by the Secretary of State for Transport, with no commercial relationships with port operators other than a requirement that they or their customers pay dues on ships, cargo and pilotage, the PLA is in a strong and impartial position to regulate navigation, without possible conflicts of interest arising.

  8.  Whilst it is clearly essential for safety reasons to have a single consistent regime for navigation on the tidal Thames, the nature of traffic varies throughout its length:

    (i)  between Wandsworth Bridge and Teddington it is principally characterised by recreational rowing, boating and dinghy sailing, but with some commercial passenger boat activity;

    (ii)  between the Thames Barrier and Wandsworth, navigation is dominated by commercial passenger vessels serving tourists and commuters, tugs towing away much of London's refuse in container barges, aggregate vessels working in support of the construction industry, and cruise liners, which moor in the Pool of London close to Tower Bridge and the Tower of London, in the summer season; and

    (iii)  below the Thames Barrier vessels are predominantly seagoing and commercial in nature.

  9.  Each year there are approximately 30,000 commercial vessel movements through the estuary, which provides access to both the Thames and the Medway, 33,000 vessel and small craft movements through the Thames Barrier, and 120,000 vessel movements through central London.

  10.  The PLA's vision is to work with the port community to create a safe, sustainable and competitive environment for the benefit of its commercial customers and the enjoyment of leisure users of the tidal Thames.

  11.  The PLA's mission is, therefore, to:

    —  facilitate the safety of navigation on the tidal Thames;

    —  deliver value for money services to its commercial customers and to promote the potential of the Port of London;

    —  respect the environment of the tidal Thames and to pursue principles of sustainable development;

    —  provide an efficient, professional and equitable service to commercial and leisure users and riparian owners on issues affecting the River; and

    —  safeguard the navigational access to, and the viability of, the Port of London and its infrastructure.

  12.  The PLA consults widely with all its stakeholder beneficiaries, including river users, and its staff, in order to achieve its objectives, and actively promotes the Port of London as the ideal port for transferring goods to and from the London and South East markets.

THE CONTRIBUTION OF THE PORT OF LONDON TO THE UNITED KINGDOM ECONOMY

  13.  Based on a 1998 report commissioned by the PLA from Segal Quince Wicksteed Ltd, economic development consultants, the Port of London generated over 37,000 jobs in total, 31,000 of which stemmed directly from port activities, and £2.7 billion per year in gross value added, within London, Essex and Kent. This increases as imported, processed goods are sold outside this area, although we are unable to compute this figure accurately. The annual purchasing budget for the Port was estimated to be £5.8 billion, nearly half of which was spent on imported goods and services. Thus the Port contributes at least £8.5 billion per annum to the UK's gross domestic product. An investment of approximately £1 billion is anticipated in new terminal facilities over the next 10 to 15 years.

  14.  The Port of London thus has a major impact on the economy of, and the quality of life in, London and the South East, with many of the goods imported through the port being enjoyed by consumers in the region.

PROBLEMS AND OPPORTUNITIES FACING THE PORT

Good Growth Prospects

  15.  From Focus on Ports published by the Government with Modern Ports it can be computed that non-fuel port trade increases at approximately 1.16 per cent for each 1 per cent growth in gross domestic product. Ninety five per cent of UK trade moves by sea, the most environmentally sustainable mode of transport. UK container traffic has grown historically at between 6 and 8 per cent per annum and the UK is fast running out of container capacity, as Modern Ports makes clear (paragraph 2.4.6).

  16.  The UK's major ports are thus vital national assets and an integral part of the national distribution system. They have to be run efficiently to attract and hold trade in a competitive, price sensitive market, so as to generate funds to support continued investment, and provide the service of moving goods to market as effectively and speedily as possible.

  17.  Thirty per cent of the UK's population, enjoying 35 per cent of the UK's gross domestic product, live within two hours access of the Port of London.

  18.  For these reasons, the PLA considers that the Port of London continues to have strong prospects for long term growth, both in its short-sea roll-on/roll-off activities, and in the deep-sea container trade.

The Proposed Development of the Shell Haven Oil Refinery Site

  19.  The largest single opportunity for the Port of London is the proposed redevelopment by P&O Ports Ltd, of the Shell Haven site in Thurrock as a world class, state of the art container terminal together with an associated roll-on/roll-off facility being planned by Jacobs Holdings PLC. Currently, these projects are in the initial design and planning stage. Scoping for the associated comprehensive environmental impact assessment has also commenced.

  20.  P&O are planning, over a 15 to 20 year period, to construct 3 km of quayside with berthing facilities for up to eight container vessels with an ultimate throughput capacity of 3.5 million TEUs per annum. (Twenty Feet Equivalent Units—the standard measure for containers). With the associated distribution and industrial park planned for the site, P&O estimates that up to 10,000 jobs could be created. Whilst many detailed aspects of the project have not yet been addressed, the project has the general support of the Thurrock Council and the PLA.

  21.  The site has good dual carriageway access to the A13 (a major trunk road) and the M25, and is thus extremely well situated for access to the London and South East markets. The site is directly served by the London Tilbury and Southend rail line and, with suitable improvements over the period of the development, considerable volumes of goods will be able to be moved by rail. Quayside transfer of containers to and from rail will assist in the diversification of rail freight from the movement of bulk materials, which we understand is subject to cyclical demand. The close proximity of the proposed distribution and industrial park will also reduce the need for inland transport of both exports and imports.

  22.  To provide access to the terminal comparable with that at Le Havre and Felixstowe, significant dredging of the navigational channel will be required. The associated environmental investigations are already underway. The PLA is fully committed to identifying and resolving any potential impacts and, should it prove necessary, to ensuring that any required mitigation or compensation measures are achieved.

Safety

  23.  There are three specific areas in relation to safety:

(i)  Navigational Safety

  24.  As stated above, the prime service of the PLA is to facilitate the safe navigation of vessels within its jurisdiction, by reducing risk to a level which is "as low as reasonably practical" (ALARP), as required by the Port Marine Safety Code. A formal safety assessment is currently being finalised by specialist consultants, which will form the basis for further enhancement of the PLA's safety management system.

  25.  Substantial investment has been made by the PLA in recent years to ensure that its navigation and safety systems have high reliability and employ "state of the art" technology. Moreover, the PLA is leading the way in investigating the benefits of electronic navigational charts and transponder technology to enable control centres to predict the movements of vessels in the port environment. In addition, the PLA actively participates in the development of national and international standards and procedures affecting port operations, as illustrated by its major contribution to the development of the Port Marine Safety Code and accompanying Good Practice Guide.

  26.  Lord Justice Clarke in his report on Safety on the River Thames stated:

    "I have reached the clear conclusion that the regulation of safety on the Thames has improved almost beyond recognition since 1989. There have been numerous individual advances, which I have referred to above, many of which were the result of the recommendations made by the MAIB and the Hayes Reports and by the inquest jury. The PLA has itself changed to such an extent that it is now a trust port and entirely independent of any commercial interest. It has improved its management structures in a number of ways and I have been very impressed by its professional approach and especially, in the context of navigational safety, by the professional approach of its Harbour Masters, led by the Chief Harbour Master."

Search and Rescue (SAR)

  27.  Under a memorandum of understanding with the Maritime and Coastguard Agency (MCA), the PLA has voluntarily accepted responsibility for the co-ordination of SAR activities upstream of Canvey Island.

  28.  However, plans are currently at an advanced stage between the DETR, MCA, the Royal National Lifeboat Institute (RNLI) and the PLA for the full time deployment of three dedicated rescue craft in the area of the river used by the passenger vessels, and for full time MCA (Coastguard) watch officers, to be integrated with the PLA's navigation control function at its Thames Barrier Navigation Control Centre, thereby substantially increasing SAR resources and readiness.

The tragedy of the "Marchioness"

  29.  As the Committee will be aware, Lord Justice Clarke is about to produce his report following his investigation under the Merchant Shipping Act into the loss in 1989 of the "Marchioness" and 51 lives. The PLA is not, therefore, in a position to comment on his possible findings, other than to reassure the Committee and the public that if Lord Justice Clarke makes any recommendations to enhance the margin of safety that fall within the PLA's area of responsibility, they will be actioned as speedily as possible, as were the recommendations from the Thames Safety Inquiry and the previous investigations into the accident.

  30.  The PLA are obviously willing to provide an update, if the Committee requires this, once Lord Justice Clarke's report is published.

(ii)  Safety of Wharf and Terminal Operators

  31.  Safety at the wharves and terminals on the Thames is the responsibility of the individual owners or operators. The Health and Safety Executive regulate their activities.

  32.  PLA recently distributed copies of the Port Safety Organisation's (PSO) Non-permanent workers "Passport" scheme documentation to all terminal operators in the Port.

(iii)  Health and Safety of PLA Employees

  33.  The Chief Executive of the PLA is ultimately responsible to the Board for the health and safety of PLA employees. The employment of a full-time Health and Safety Adviser, backed by robust staff consultative procedures, ensures that the PLA has a good record in this area.

The Environment

  34.  The PLA supports principles of sustainable development, and is sensitive to its responsibilities in relation to the environment of the tidal Thames. The PLA is a founding and active member of the Thames Estuary Partnership, which acts as a forum for various organisations including English Nature and the Environment Agency to promote sustainable development between Tower Bridge and the sea.

  35.  The PLA is committed to ensuring that any development with which it is associated is environmentally responsible. However, as is discussed further below, the Authority is concerned that European environmental directives such as the Birds and Habitats Directives appear to be applied more rigorously in the UK than in many other parts of North West Europe. Whilst this has not to date caused any direct conflict in relation to the Thames, the forthcoming re-development of the Shell Haven site has forced such issues sharply into focus.

  36.  "Modern Ports" stresses the importance of meeting environmental, social and economic objectives all at the same time. In practice, however, the designation of European sites under these Directives is leading to a significant, disproportionate increase in the cost of meeting environmental requirements. Such costs include increased expenditure on the initial studies, consultancy fees, impact assessments etc; potentially very substantial costs associated with mitigation or compensation measures; and an ongoing financial commitment in terms of monitoring, maintenance etc.

Regulation

  37.  The PLA welcomed the publication of "Modernising Trust Ports, A Guide to Good Governance", and was pleased to have the DETR confirm that only minor reporting changes were needed in order for the PLA to meet the new national governance standards.

Inter port co-operation

  38.  The PLA are active members of the United Kingdom Major Ports Group (UKMPG), and the Ports Safety Organisation (PSO), which provide by means of seminars, meetings, etc opportunities for members to raise standards to achieve best practice by learning from one another. The PLA supports the work of British Ports Industry Training ("BPIT") in defining standards of competence for port employees and promoting training throughout the industry.

  39.  Together with Medway Ports, the PLA operates a joint pilot boarding and landing service in the form of a 50:50 joint venture company, thereby avoiding duplication of the associated assets in the Thames and Medway areas.

Safeguarding of strategically important wharves

  40.  As general cargo operations have largely, but not entirely, withdrawn from the Upper Thames, the riverside area has been extensively redeveloped for residential and commercial purposes. The pressures for redevelopment have spread to the Thames Gateway where some councils, eager for regeneration projects, have amended their planning policies to encourage the redevelopment of wharves for non-port use. This puts pressure on neighbouring and pre-existing wharves and terminals which often need to operate according to the state of the tide outside normal working hours. Such activity is often opposed by residents. This is turn can result in port operations being prejudiced even though such a possibility was not a consideration during the planning approval process for the neighbouring development.

  41.  Substantial volumes of sea dredged aggregates (8.3 million tonnes per annum) are delivered by ship as far upstream as Fulham, and 760,000 tonnes of domestic waste moves from riverside waste transfer stations downriver to landfill in Essex each year. These volumes are equivalent to 240,000 lorry movements on London's roads, and there is scope for considerably more of this type of traffic including transferring waste for recycling on the river provided cargo handling facilities, in particular land, remain available for use. The PLA is working with the Mayor of London to protect and increase use of the Thames for such purposes, thereby helping to relieve London's traffic congestion.

  42.  To this end, the Government has safeguarded 30 wharves upstream of the Thames Barrier in the GLA area. The Mayor, following advice from the PLA, can now direct refusal of schemes, which do not incorporate the strategic need for cargo handling on the River Thames in relation to these sites. A further 41 potential sites, together with essential boat maintenance facilities, are under detailed consideration by the Mayor of London and the PLA.

  43.  The PLA would appreciate the Committee's support for this policy, which the PLA considers to be the best practical way of recognising the unique circumstances of the Port of London and ensuring that the Thames remains a working river for both commercial and leisure purposes, rather than becoming sterilised with wall to wall residential and non-port related commercial developments along both banks.

WHETHER THE PROPOSALS CONTAINED IN "MODERN PORTS" ARE ADEQUATE

  44.  The PLA welcomes the publication of "Modern Ports" which confirms and codifies current Government Policy on the ports industry. It is both constructive and helpful to have these policies formally defined and set out in a single document.

  45.  The PLA particularly welcomes the proposals in paragraph 3.2.8 to rationalise and, where possible, simplify the consent and inquiry procedures for port developments, and it awaits the detailed proposals with great interest.

  46.  The PLA works closely with Ports Division of the DETR, and is pleased to see that the Government is committed to resisting unfair competition from continental Europe (paragraph 2.3.1).

  47.  Many European countries do not levy light dues on commercial vessels, and the UK Government's charges in this regard are resented by a number of the world's major shipping lines. The PLA consider that the abolition of such charges, thereby "levelling the playing field", would be appreciated by the shipping industry (paragraph 3.2.14 refers).

  48.  With the major exception of the proposed European Directive on Access to Port Services (see below), the PLA has no further comments on "Modern Ports" that it wishes to bring to the attention of the Committee.

WHAT OTHER POLICIES SHOULD BE PURSUED TO BENEFIT PORTS

Proposed European Directive on Access to Port Services

  49.  Whilst it is difficult to discuss the proposed European Directive on access to port services without the benefits of a published text, a number of meetings between the UKMPG, the European Commissioner, Ms de Palacio, and her senior staff have taken place. It has become clear that the proposal is intended to apply to any European Union seaport with annual traffic in excess of five million tonnes and to cover commercial services including pilotage, towage, mooring, cargo handling, storage and consolidation, and passenger services.

  50.  Whilst pilotage directly concerns the PLA, the PLA believes that there will be an opt-out provision relating to maritime safety. The main issue is the proposed requirement to open up cargo handling, stevedoring and storage to other providers. The PLA understands that at least two operators would be required in any port, which comes within the scope of the Directive.

  51.  The major UK Ports have mainly been privatised, including the Tilbury complex on the Thames. The UK thus relies on direct private sector investment to provide most port services. It follows that port operators making investments in new terminals and other facilities should be free to make a return on their investment that rewards them for taking the initial start up risk.

  52.  It is counter to the United Kingdom's interests that private investors, particularly those that have taken the risk in investing in start up facilities, should effectively have part of their assets seized under the proposed directive to permit a second operator, who has little initial risk, to operate within the port. Such a proposal, if implemented, would be tantamount to interference in the UK economy, and possibly be retroactive in terms of application.

  53.  Most coastal ports in north west Europe are state or municipally owned and financed, and are run in effect as "landlord" ports. The proposed directive is relevant to such a system where state-owned, financed, and possibly subsidised, monopolies own port facilities leasing them to third party operators, but is irrelevant and highly damaging to the privately financed UK industry.

  54.  The disincentive for international port operators to invest in new facilities in the United Kingdom will be considerable, if the proposed directive is implemented without modification. This could have serious consequences for the whole of the UK population if, for example, container-handling capacity fails to meet demand in the decade ahead. The proposal should be carefully studied by HM Government and modified by negotiation with the Commission and other EU member states so as not to inhibit further investment in the UK ports and to protect current investment. The PLA respectfully requests that the Committee draw the attention of fellow parliamentarians to this crucial issue.

European Environmental Legislation

  55.  The Government should ensure that the designation and management of marine sites under European environmental legislation are undertaken using consistently applied criteria across the whole of North West Europe to ensure that competition between North West European ports such as Hamburg, Bremen, Rotterdam and Le Havre, and the British ports is on a "level playing field". Otherwise, there is a real risk that North West Continental European ports will develop at the expense of major ports on the east and south coasts of Britain with a consequential increase in distribution costs for feeder services to and from, say Rotterdam, rather than direct services into London, Felixstowe and Southampton. A worrying example is provided by the different way in which economic and social criteria are clearly being considered in sites proposed for designation under the Habitats Directive by other European countries.

Proposed changes to the law on Corporate Manslaughter

  56.  In May 2000, the Home Office published a proposal to update the law on involuntary manslaughter and to introduce a new offence of corporate killing which, in general, the PLA supports.

  57.  As members of the Committee are no doubt aware, the new offence of corporate killing is proposed where an organisation's conduct is causing death falls far below what could reasonably be expected [and] the death is deemed to have been caused by management failure, in that the activities of the organisation are managed or organised so as to fail to ensure the health and safety of persons employed in or affected by its activities.

  58.  Ports and harbours, by their nature, are hazardous places. Ships converge and the water invariably shallows. There is also a general public right of navigation for commercial shipping and private craft. A fundamental legal principle under which Harbour Authorities, such as the PLA, operate is that the master of a vessel is responsible for its conduct and safe navigation, not the Harbour Authority, which is solely responsible for the provision of a safe regime for navigation.

  59.  In the PLA's view, except where the authority concerned is guilty of negligence, there should be an exemption from the new law for the emergency services, including Harbour Authorities, who are primarily dependant on the acts of others, and who manage levels of risk substantially higher than those attributable to virtually all commercial organisations.

  60.  Furthermore, a requirement to "ensure the health and safety of those affected" is not realistic. Whilst, safety systems can reduce the risk of accident to a level which is "as low as reasonably practical (ALARP)", they cannot guarantee absolute safety. Risk is inherent in all human activity.

  61.  The Home Office proposal did not make it clear that the two tests of "management failure", and "conduct falling far below" had both to apply before a conviction could be obtained, but the PLA has subsequently received an assurance from the Home Office that this is the intention.

  62.  The PLA would ask the Committee to ensure that the particular position of authorities with statutory responsibility for managing emergencies, such as the Local Emergency Services and Harbour Authorities is fully taken into account, if such legislation is put before Parliament. Officers of such organisations should not have to operate in fear of legal restrictions in managing emergencies where lives may be being lost due to the acts of others.

  63.  A copy of the PLA's submission to the Home Office is attached should members of the Committee wish to see it.[15]

Alcohol and Drug Abuse

  64.  In the recommendations in his Thames Safety Inquiry, Lord Justice Clarke stated that:

    "Subject only to necessary or appropriate differences because of the maritime dimension, there should be no material difference between the alcohol legislation which regulates those driving or in charge of a motor vehicle on a public road and the alcohol [and drug] legislation which regulates those navigating or in charge of a vessel."

  65.  The PLA strongly supports Lord Justice Clarke's recommendation, and has made various representations to the DETR to this effect, the latest being in February 2000 as part of public consultations on this issue.

  66.  The PLA would welcome the support of the Committee for the introduction of such legislation as soon as possible. Again, a copy of the PLA's submission is attached should members of the Committee wish to see it.[16]

S C Cuthbert

Chief Executive

18 January 2001


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