My Lords, I recognise the concern that the loss of the Hull to Zeebrugge route has caused. My colleague the Maritime Minister, Robert Courts, met P&O Ferries on 15 December, when he raised the closure of the route. This is a commercial matter for P&O and, although the local impacts are very regrettable, I am satisfied that our national freight resilience has not been compromised.
My Lords, it may be a commercial matter for P&O, but when it closed the route P&O said it was doing so in light of the Covid pandemic. Given that the Government are spending literally billions of pounds to run very large numbers of almost entirely empty trains up and down the country, do they not think they should be pressing P&O to keep this route open? This route is not a luxury but is crucial for the flow of tourism from France and elsewhere in Europe, which the north wishes to see reinstated as soon as possible when restrictions are eased.
My Lords, although the loss of this route is regrettable, in present circumstances, with passenger traffic severely constrained, it would not be in the public interest, nor fair to other operators, to maintain empty capacity there at public expense. There continue to be services for both passengers and accompanied freight from Hull to north-west Europe through Rotterdam and freight services to Zeebrugge from the Humber.
My Lords, ferries are the lifeblood of many communities around the United Kingdom, and the Government have trumpeted a new shipbuilding strategy—at the moment, without any new ship orders. The noble Baroness has highlighted to me before in this House the Government’s push to reduce merchant ship emissions as part of the green revolution. To focus on just one of the many opportunities that I think there are to pull these threads together, I ask her to encourage the Government to replace the almost 50 year-old Scilly Islands ferry, which will soon not be able to run at all, with a new, green ship—I do not mean its colour, of course—to be built at Appledore, a very efficient and capable West Country shipyard with currently no work whatever, ensuring the continued future link between the mainland and the Scillies and killing three birds with one stone.
I thank the noble Lord for his question, which is slightly beyond the remit of what we are discussing today—but never mind, I will take his suggestion back to the department. The department is very keen to make maritime more green and it is the case that the ferry service to the Isles of Scilly is a lifeline service. It is essential that it continues, and it should do so in the greenest ships possible.
The Minister said that the local consequences of the decision to close this route were “very regrettable”. In Hull, they are more than very regrettable. Hull has the highest unemployment rate in the country, along with Blackpool, so can she say how much strategy is being put into deciding not just which jobs will be kept open but where jobs will be kept open? As part of the levelling-up agenda, Hull is clearly in need of help.
I agree with the noble Baroness that it is very important that we make sure that job losses are kept to an absolute minimum, and I understand that that is indeed the case. The Government remain committed to Hull being one of our key ports within England; it is the 13th largest port in the country. It should be noted that there remain daily sailings to Rotterdam from Hull and that, in general, Hull will remain a very strong local economic area.
My Lords, will my noble friend give us a commitment today that the Government will do all they can to reinstate a ferry service that would be viable at the first available opportunity? Will she equally ensure that the spare capacity now in Hull will be used for freight, to increase freight capacity from the north and ease the bottleneck at Dover?
My noble friend will be aware that there are currently 19 routes going from the east coast of England across the North Sea. Plenty of freight routes are already in existence and therefore I do not believe the loss of this route will have a significant impact on freight, as I have said. However, it is worth delving a little more deeply into the viability of this service. Tourists—cars and passengers—have been declining on this service since 2014, and substituting that loss with freight did not compensate the business sufficiently. Also, the ships on this route are ageing and economically obsolete. I fear that this service was not in it for the long term in any event.
Quite recently, the Government were happy to fund a ferry-less ferry company, but now they seem unwilling to help a well-established service. The Minister has said that there are plenty of freight routes but, at the point when hauliers are grappling with the new post-Brexit bureaucracy, should not the Government be doing everything possible to broaden ferry options rather than reduce them?
As I explained to the previous questioner, there are already several—indeed, 19—routes that freight can take across the North Sea, and those will continue. I therefore do not see that the concerns of the noble Baroness have any merit at all. The Government also have government-secured freight capacity; as she mentioned, these ferries are for category 1 goods and will be needed if there are any problems at the short straits.
It is clear from the Minister’s answers that the Government did nothing to try to persuade P&O’s owners in Dubai not to pull the plug on the long-standing Hull-Zeebrugge service. Will the Government take into account P&O’s decision to withdraw this service, and thus not back Britain and its employees at this critical time, when deciding in future whether to award any taxpayer-funded contracts or other financial support to P&O?
The Government did not do nothing; they had conversations with P&O, which operates many ferry routes in the UK. It reached its decision based on the factors I have set out. However, when we were at the height of the pandemic for the first time round, the Government supported this route to see whether it could be viable in the long term, funding it to the tune of £1,272,000. Despite this funding, it has become clear that the medium-term viability of this route is simply not there.
My Lords, the Government have said that taking back control is an important dimension to everything they believe in and that levelling up is their next major priority. I am sure that the Minister is aware that, in Yorkshire, tourism and food exports are fundamental to the economy and that over half its food exports go to the European continent. Is she really sure that we should leave decisions such as this to a company in the Gulf and that public interest does not require the Government to fulfil their commitment to levelling up the north by keeping links such as this going?
I thank the noble Lord for allowing me to reconfirm, following the many times I have already done so, that the Government believe that there are freight and passenger services already operating from the east coast to the EU which will be able to support Yorkshire and the whole of the north.
My Lords, more generally, what measures can the Government advance to ensure that the UK’s distribution arteries, both inbound and outbound, are not held hostage to the commercial vagaries of the private sector—and the public sector, for that matter—and that marketplaces and strategic destinations are not only kept open but added to, as necessities now dictate?
The noble Viscount will know that the maritime sector is an extremely well-developed and highly competitive private sector. The Government work very closely with it; we endeavour to intervene when there are problems, but on the whole we do not. For example, we worked very closely with the ports recently when there was a 15% increase in year-on-year container capacity. That is now beginning to resolve itself. Furthermore, we also provided £200 million in one-off grants to support ports through the port infrastructure fund. There are things we can do, but in general the maritime sector remains a private sector.