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Liverpool-Belfast Ferry Service

Volume 12: debated on Wednesday 11 November 1981

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(by private notice) asked the Secretary of State for Northern Ireland what is Government policy with regard to a ferry service between Liverpool and Belfast after the withdrawal today of the P & O ferry service, and if he will make a statement.

I regard a ferry service between Liverpool and Belfast as a highly desirable link between the two cities and between England and Northern Ireland. This link, which has been in existence for more than 160 years, is of importance for the convenience of the travelling public, the development of tourism and, to a lesser extent, the movement of freight.

The decision to close the service as from today has been taken by P & O for its own commercial reasons. I regret the loss of jobs and the inconvenience that this will cause to the public, but I hope that the closure will be only temporary.

It seems clear that the major reasons for the loss incurred on the service in recent years have been the unsuitability of the vessels and unrealistic manning levels. P & O could not see its way to reinvesting in suitable ships, but I believe that other operators may well be prepared, in the light of the demand for this service and its potential development, to make that investment.

Since the threat to the P & O service some months ago, my officials have been in touch with a wide range of alternative potential operators. A number of these have expressed a serious interest in reopening the service. I stress that, while the Government have been doing everything possible to interest the companies in operating on the route, final decisions will be taken on purely commercial grounds. It has been suggested by various groups, including among others the right hon. Gentleman and his colleagues, that subsidies should be provided. I have made it clear that, in my view, it would not be right to spend taxpayers' money on subsidising a service that has prospects of viability and which other operators are willing to test commercially. I very much hope that a Belfast to Liverpool ferry service will soon be restored.

I thank you, Mr. Speaker, for allowing this private notice question to be asked on a subject that is important not only to Northern Ireland but to a vast number of people in the rest of the United Kingdom.

It is inconceivable to Labour Members, and I suspect to many Conservative Members, that as from today, after well over 100 years, there is no ferry link between Belfast and Liverpool. We view the situation with alarm and despondency. We are amazed at the Government's inflexibility and dogmatic adherence to the doctrine of privatisation. It allows them no room for manoeuvre to carry out common-sense and proper policies. Frankly, I expected better things from the Secretary of State.

We asked the right hon. Gentleman to step in now that P & O is out of the way. Will the Government take over the operation of the ferry link, even on an agency basis, for a short interim period until new operators can be found to run the service? The amount of money involved will be absolute peanuts compared with the benefits that will inevitably flow. I am sorry that the "Minister for Liverpool", the Secretary of State for the Environment, is not present. Perhaps both right hon. Gentlemen should take advice from one of their colleagues, get on their bikes and start talking to the people of Belfast and Liverpool who are losing their jobs and bearing the brunt of Government inflexibility.

This is a commercial service which could be run at a profit. While that opportunity exists, it would be utterly wrong for the Government to intervene to subsidise with taxpayers' money a service that can be run at a profit on a commercial basis. Until the P & O service is out of the way, no one else will be prepared to come forward. It would be absolutely fatal to other people coming forward if I were now to step in and run the service temporarily with a subsidy.

I want to keep the service going. I do not want any more unemployment than is absolutely necessary by a demanning exercise. However, to continue with the present service would not save employment in the long run. It would certainly prevent more jobs from coming from a new service as soon as it can be set up.

As we have said before, if the service is closed more Government money will be spent on redundancy pay and benefits for those who lose their jobs than it would cost to keep the service open on an interim, basis until new operators came along. That could take a short time or a long time.

We are now getting involved in an economic argument about whether all jobs should be retained and no unemployment permitted. That has not been the policy of either Government. The fact is that no one else will come forward while this operation continues, be it by P & O or on an agency basis by the Government. It must finish before other people will be prepared to come forward. That is what I must consider, because we all wish to see some service maintained over a long period.

I propose to call all those hon. Members who have been rising, to speak. However, this may be an opportune moment for me to say that, on reflection, I should have called another Labour Member yesterday. But I must act under the pressure of events in the Chamber.

Do not these events emphasise the wisdom of a recommedation of the Economic Council for Northern Ireland that Ulster requires three sea links—north, centre and south—with the mainland and, therefore, the urgency of exploring the means of bringing into use the roll-on/roll-off services that are already available at the port of Warrenpoint?

These are commercial matters. From all that I have seen in a short time, the roll-on/roll-off operation from Warrenpoint would be very important.

Is my right hon. Friend aware that, while the P & O men are understandably fighting for their jobs, the typists employed by Liverpool city council have been on strike since May and the Liberal alliance refuses to fill their places with some of the city's unemployed? Why must the private sector, in this case P & O, lay off men because it cannot afford to pay them while the public sector can afford to hold on to staff who refuse to work?

These matters do not fall within my jurisdiction. The sooner it is recognised that the P & O service has come to an end and the men cease their sit-in on the ships, the sooner there will be a chance for others to come forward.

Which firms are interested in taking over this service? Does the right hon. Gentleman believe that realistically they will take the place of P & O? He said that they will be able to demonstrate whether this service is viable. If they do not come forward, will the Government then intervene? How many jobs are ultimately likely to be lost even if new operators get involved.

A number of ferry operators have shown an interest. Two in particular have carried out detailed surveys. I am not prepared to state who they are, because if I did so there is a good chance that they might not come forward. I assure the hon. Gentleman and the House that at least two are potential operators. As soon as the present ferry service is out of the way, they will be free in their minds to begin negotiations with the trade unions and, with the two port operators concerned.

I recognise that the question of employment is important. Undoubtedly the new operators would operate with considerably fewer seamen than are at present used on the two P & O ferries. But even if the two P & O ferries had been kept in existence, as was desired early last summer, there would have been considerable redundancies.

Is my right hon. Friend aware that many hon. Members consider it vital to maintain efficient communications between Great Britain and Northern Ireland, particularly at a time of suspicion of economic and political disengagement? Is he further aware that many hon. Members think that he is right to give private enterprise the chance to come forward and fill this gap?

I am grateful to my hon. Friend for his comments. I make it plain that I regard the maintenance of a ferry between Liverpool and Belfast as important not only from the commercial point of view but from a symbolic point of view, which we must understand.

If I have to subsidise a service that I believe can be profitable and commercial in its own right, even on a temporary basis, that denies me the money to spend on many other projects in Northern Ireland that are of great value to the community.

If the Secretary of State is so certain that the service can be run as a commercially profitable enterprise, can he tell us, in the light of discussions that he has held with various deputations, particularly those led by trade unions, which group is overmanned and losing money? Is it the National Union of Seamen or the shore-based union? Is it not a fact that the Government are not encouraging another company to start up the service immediately and that they want a gap of at least six months so that a new company can run an inferior service to that which has been provided?

No, Sir. As I understand it, there is overmanning both on the ships and on shore. The total saving required that was mentioned in earlier discussions was about £800,000, which is equivalent to the percentage of overmanning both on the ships and on shore.

I have no doubt that there will have to be a gap between the termination of the P & O service and a new company coming in. I have no indication that there will be an inferior service. In fact, as experience shows, any service that has to be subsidised over a period nearly always becomes an inferior service.

Will my right hon. Friend note that I, among other Merseyside Conservative Members, welcome the moderately optimistic tone of his statement? First, does he not think that it would help to attract private operators if the peace of the Province were assured? I am sure that Opposition Members could help in that direction by supporting the recent talks between the Prime Minister and the Taoiseach. Secondly, and more important, will my right hon. Friend confirm that the Government are not merely not against the union but are positively in favour of it?

Obviously it is of great importance, and the House thinks that it is of great importance, that the link should be preserved. It is also important for Liverpool and Merseyside that the maximum number of people should be employed. Until the sit-in and the P & O service have come to an end, no other company will come forward, and that means that the time when a new service can come into operation and jobs can be provided is delayed.

Will the Secretary of State give a guarantee today that a private operator will take over this link? Does not he appreciate that if there is a break in employment, the men now occupying the ships in Liverpool will go to the back of the dole queue and possibly be unemployed for the next 18 months or two years? Nearly 1,000 seamen are at present unemployed.

I cannot give a guarantee about particular seamen. That is entirely a matter for the company that takes over the service and makes its commercial arrangements with the National Union of Seamen. That is how the matter must rest. If I were in the position of a would-be firm, I would not come forward while seamen were sitting-in on the ships.

Does not the Secretary of State accept that it would take even the most enthusiastic operator some time to replace the present operation, and that it would not be difficult, once a commitment was obtained from an alternative operator, to introduce, on an agency basis, a British Rail ship? There would be no problem with contractual negotiations. Will the Secretary of State examine the 40 per cent. concession that is given to Service men using British Airways and see whether it is possible to afford a similar concession on the new link between England and Northern Ireland?

I do not believe that concessions are necessary, but I shall examine the hon. Gentleman's last point. Whatever may be the interim arrangement involving a British Rail ship or some other ship, it will be much better to get the new operator in position and then he can start to operate from whatever date he wishes. Of course, one would negotiate as early a date as possible. Any other arrangement is bound to detract from that operator coming forward.

Is it not disgraceful that the Government, because of an insensitive, doctrinaire attitude, should callously and arrogantly stand aloof from all the people who have been thrown on to the dole in Northern Ireland and Merseyside and when the last sea link between Britain and Northern Ireland has been broken? Does he not recognise that there is a clear duty on the Government to finance this service and to take it over? Will he give an assurance that, if private enterprise does not come forward within a reasonable time, the Government will provide the service?

The last part of what the hon. Gentleman said is entirely hypothetical. I hope very much that an operator will come forward. If I gave the answer that he wants to the last part of his question, why should any operator bother to come forward? I am not prepared to do that.

It is disgraceful that the hon. Gentleman should make accusations against the Government when he knows perfectly well that there are thousands of unemployed people in Northern Ireland who need help from the Government, and whom I wish to help, whereas I am not prepared to help what could be a commercially profitable operation.

Does not the right hon. Gentleman agree that the argument that intervention by the Government is likely to stop independent operators from coming forward is phoney? Surely the Government can take an immediate stand by temporarily keeping the route open and allowing the negotiations to go on and a settlement to be reached. Will he assure the House that if there is a long period between the P and O service closing and a new operator coming forward the Government will do precisely that? Is not the right hon. Gentleman aware that many of us believe that the workers in Liverpool are entitled to sit-in on the ships and should receive the support of everyone?

The hon. Gentleman's last comment does a good deal of damage to Liverpool's reputation. I hope that on reflection he will not make that sort of comment. I am working to try to get a new ferry service operating between Liverpool and Belfast. The hon. Gentleman's remarks will have exactly the opposite effect. New ferry services will not operate while the old service exists or while employees are sitting in on ships. New operators are not prepared to come forward while there is any question of the old service continuing in operation or being subsidised for even a short period. They require a fresh start between Liverpool and Belfast and in the circumstances I think that that requirement is justified.

Is the right hon. Gentleman aware that the employees have made savings of over £1 million and that the failure of the service is due to inadequate ships and the troubles in Northern Ireland? Does he recognise that the seamen are facing two years on the dole and will, therefore, further the dispute? Does he understand that they are angered by the Government's unpreparedness to give an interim subsidy far less than the unemployment benefits that will be involved and far less than the £8 million paid by the Government for ferries in Scotland, including P & O services? Will the right hon. Gentleman, in view of his refusal to guarantee a service and to retain jobs in Liverpool and Belfast, ask the Secretary of State for the Environment to lift his embargo upon meeting those who are concerned to retain the service? Does the right hon. Gentleman want another riot in Liverpool before he does something?

One is constantly worried and concerned about the level of unemployment in Liverpool and in Northern Ireland. Remarks of the sort made by the hon. Gentleman merely make the problem more difficult. Despite some savings that have resulted from reductions in overmanning, and granted that P & O is operating the wrong type of ship, I ask the hon. Gentleman to realise that there is still a considerable degree of overmanning which P & O was unable to negotiate away during the summer. That overmanning is claimed to be costing about £800,000.

Is the right hon. Gentleman aware that his arguments about purity, market forces and lack of Government intervention would ring true if they were applied straight across the board? Will he confirm that the Government are handing out subsidies and grants to keep some people in employment, albeit in some instances only temporarily? How does he reconcile the Government's ability to continue to throw money at De Lorean and to subsidise Harland and Wolff with his apparently being unable to help to bail out this organisation?

Quite a lot of public money is put into various operations in Northern Ireland to help employment. I support that policy. The purpose of that operation is to provide jobs, to keep jobs and to make jobs more profitable. We are dealing with an example where jobs can be profitable without a subsidy. Therefore, it would be wrong to introduce a subsidy.

Will the right hon. Gentleman try to look slightly beyond his blind ideology? A vacuum in the continuation of a vital service will have immeasurable political, economic and social consequences for Northern Iraland and Liverpool. Cannot he envisage that the negotiations that he has in mind could be quite protracted and that in the meantime no service will be provided? What will happen if there in no bidder at the end of the negotiations? What stance would the Government take? Are they committed to the reintroduction of the service? Does not the right hon. Gentleman's decision and that of his right hon. Friend the Secretary of State for the Environment reveal that the brave words that the Secretary of State for the Environment issued at the Conservative Party conference about bringing relief to the plight of Liverpool are mere gossamer in the wind?

It is beginning to become apparent that the Opposition Front Bench has lost all commercial reality. A commercial transaction is in the process of taking place. The hon. Gentleman must know only too well that any remarks that I made on the future of the service would merely prejudice the outcome of what I hope will be successful negotiations. I should prefer there to be no gap between the beginning of a new service and the ending of the old one. The social, political and economic consequences that the hon. Gentleman talks about are not as severe as all that. The social and economic consequences of subsidising a service which could be profitable in its own right have to be considered in the context of Northern Ireland and in what I am able to do to help other industries which have a much greater need of the money.