Memorandum by the Port of London Authority
(POR 07)
INTRODUCTION
The Port of London Authority ("PLA")
welcomes the opportunity to make this updated submission to the
Transport Sub Committee of the Transport, Local Government and
the Regions Committee, following the work of its predecessor committee
and the publication of the Government's document "Modern
Ports".
This submission supplements that made in January
2001 to the Transport Sub Committee of the Environmental Transport
and Regional Affairs Committee and specifically addresses the
three questions set out in the Sub Committee's Press Notice dated
1 February 2002.
EUROPEAN DRAFT
DIRECTIVE ON
MARKET ACCESS
TO PORT
SERVICES
In spite of a number of significant amendments
approved by the European Parliament and its Transport Committee
last autumn, the amended version of the European Commission's
proposed Directive published by the Commission on 13 February
2002 rejects a considerable number of these amendments and, to
a large extent, the current draft Directive remains close to that
originally proposed in February 2001.
The PLA thus remains opposed to the introduction
of the proposed Directive in its present form.
In essence, like the UK Government, the PLA
welcomes sensible and proportionate steps to improve the quality,
efficiency and flexibility of service, to reduce costs and to
produce a sustainable strategic integrated transport system across
Europe.
Any measures taken should be realistic and proportionate.
The Directive might be made to work in continental
ports where the state or city owned port authority acts as landlord
and leases its quayside land and facilities to cargo handling
companies (such as Rotterdam and Antwerp), but not in the UK where
all major port investment is provided by the private sector. The
sequestration of assets, including land, is a major disincentive
to continue investment.
In the free market system, private sector investors
are in business to make a return on their investment and they
must have continued confidence if they are to continue to invest
in UK ports. "Modern Ports" makes it absolutely clear
that private investment is to be the method by which the ports
industry is to be funded. International port investors can easily
invest elsewhere if the UK is not conducive to investment. One
of them is already noticeable by its absence from the UK, and
another has stated that it will reconsider its UK investment plans
if the Directive, in its current form, becomes law. The right
to enjoy ownership of property is also supposed to be enshrined
in the Treaty of Rome, as well as the Human Rights Act.
The PLA is encouraged by the fact that the Government
has stated publicly that the Directive is unacceptable to the
UK in its present form, and we look forward to working with the
Government and colleagues in the UK Major Ports Group in endeavouring
to have the draft significantly amended.
It is of great concern that the Commissioner
and her officials do not appear to be willing to amend their proposals
to take the UK industry's financial structure into account, in
spite of the strong representations made to them and the fact
that the UK's port trade is by far the largest in Europe, being
as large as those of Germany and France combined.
Another faultline in the Draft Directive is
that it ignores competition between ports. This is significant
as far as the UK is concerned. The Draft overlooks what the relevant
markets are for the transport of each type of cargo, which is
the way the competition authorities assess competition issues.
The real issue, as senior European Commission
officials have admitted in private, is the issue of state aid
to ports and the resulting uneven European playing field. Being
unable to resolve this thorny issue, the Transport Directorate
have adopted a legalistic and mechanical approach to port services
that the PLA believes to be unworkable in practice, and to be
discriminatory and disproportionate as far as the UK ports industry
is concerned.
But it is the continued uncertainty over future
private investment that has the potential to damage the UK industry,
and that risk will remain unless the Directive is withdrawn or
substantially amended.
THE PROPOSED
PROJECT APPRAISAL
FRAMEWORK FOR
PORTS
The proposed project framework contains a number
of helpful and constructive ideas, but the consultation document
appears to favour a prescriptive, and possibly even a pro forma,
approach to applications for port development.
Port projects vary considerably in their infrastructure,
facilities and financing requirements and a "one size fits
all" approach for the assessment of privately financed projects,
which vary from an investment of a few million pounds sterling
to, say, £500 million, would not be appropriate.
The document is silent on how the project appraisal
framework is to be integrated with the marine nature conservation
consents regime. The latter is an extremely complex process, particularly
where port developments may have an impact on European sites designated
under the Birds and Habitats Directives, and appears to conflict
with the "qualitative environmental capital style approach"
referred to in the document.
In addition, the document ignores the proposed
changes to the planning for major infrastructure projects (see
below) recently announced by the Department. Again, it is not
clear how and at what stage in the review process information
prepared to support an application using the project appraisal
criteria, is to be reviewed by the Secretary of State and/or the
Department, or Parliament.
If the Government, as stated in "Modern
Ports", really does intend to maintain the balance between
society's economic, social and environmental needs, then there
needs to be wide recognition that it is in our estuarial ports
that conflict between nature conservation and economic necessity
is most acute. Government needs to ensure that all three sets
of needs are held equally valid, and maintain an equitable balance
between them at all key stages in the process of carrying out
the required environmental assessments. The proposed Project Appraisal
Framework document would be considerably enhanced if it were amended
to take the environmental and proposed Parliamentary review processes
into account.
The proposed Project Appraisal Framework document
also appears to include areas that are primarily operational in
nature, rather than confining its considerations to strategic
land use and planning issues covered by the law in its assessment
criteria. For example, whilst no-one would wish to downplay the
importance of improving the health and safety record of the UK's
ports, it is difficult to see how an improved health and safety
record can be deduced from an examination of project design, other
than by a detailed examination of operational configurations of
equipment, a review of employee training and operating procedures.
This is surely not the purpose of the land use planning regime.
PROPOSED CHANGES
TO PLANNING
APPLICATION PROCEDURES
FOR MAJOR
INFRASTRUCTURE PROJECTS
The Government's proposal to reform the planning
system for major infrastructure projects is welcome, provided
the excessive delays and costs of an Inquiry, such as that into
Terminal Five at London, Heathrow, can really be avoided in the
future. The fundamental right of representation at the decision-making
forum by the promoter and those affected by the proposal under
consideration should be protected. It is not clear how this will
be incorporated in the current proposals.
What is, therefore, important, is that the new
system really does speed up the process in practice, and does
not transfer laborious time consuming and costly procedures from
a planning inquiry to Parliamentary committees, thereby detracting
from their very important work.
It is the costly marine nature conservation
regime that slows down the procedures for the approval of port
projects, not the planning procedures in themselves. A detailed
review of major port infrastructure consents procedures therefore
needs to include the complex marine environmental consents regime
and procedures. This does not imply support for any compromise
of existing environmental standards. But the present marine consents
regime is complex, covering a wide range of UK and European legislation
which is often mutually inconsistent in its requirements, processes
and procedures and extremely expensive to comply with, particularly
at the early stage of a major project. This, to date, has been
the cause of delay to port projects, not the public inquiry itself.
An understandable concern could arise in that
the proposal is intended to apply to England only. This may raise
the question of Members of Parliament from different areas of
the United Kingdom examining proposals relating solely to a constituent
country or region, and the additional question as to whether similar
procedures are to be adopted by the Welsh Assembly and the Scottish
Parliament, in due course. Otherwise, tensions between UK and
regional/national policy may result.
S C Cuthbert
Chief Executive
Port of London Authority
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