Britain's shipowners and port operators can be excused for feeling slightly paranoid after being engulfed by a spate of bad news in the past few days.
First, the European Commission announced it was launching an investigation into the legality of U.K. government grants of more than 400 million ($600 million) to help the ports of Liverpool and London trim their surplus labor.Then, the U.K. government itself tightened the screw by announcing a whooping 14 percent increase in lighthouse taxes. Transport Secretary John Moore broke the news on the day the General Council of British Shipping launched yet another plea for help to halt the escalating decline of the national flag fleet.
The jump in lighthouse dues brought howls of protest from the shipping and port industries, and for good reason. The U.K. finances its lighthouses
from so-called light dues levied on merchant ships visiting British and Irish ports. In Europe, lighthouses costs are met from general taxation.
British ports claim their European rivals have cashed in on this to grab a large, and fast-growing slice of their business. The U.K., they say, is fast becoming an offshore island of the Continent, with the big ships dropping off U.K.-bound cargoes in Europe for transshipment in smaller vessels to Britain.
Rules governing U.K. lighthouses have not been changed since the last century. Under the Merchant Shipping Act of 1894 lighthouses are operated by three authorities: Trinity House, responsible for England, Wales and the Channel Islands, the Commissioners for Northern Lights in Scotland and the Isle of Man and the Commissioners for Irish Lights in Ireland.
The system is obsolete and unfair, its critics allege. Fishermen, yachtsmen and the Royal Navy who are heavy users of the service pay nothing toward its upkeep. British consumers and exporters pay two-thirds of the cost of navigational aid for the Irish Republic. What galls shipowners most is the fact that the majority of the merchant ships that finance the lighthouses have sophisticated electronic systems that make them less and less dependent on external aids.
This is "a classic case of this nation shooting itself, commercially, in the foot," said W.G. Runciman, chairman of the GCBS.
Mr. Moore argues that the 14 percent increase was needed to close the gap between revenue and expenditure. In 1985-86 receipts from light dues amounted to about 44 million ($66 million), well below the expenditure by the three Lighthouse authorities of 59 million ($88.5 million). The balance was met
from reserves in the General Lighthouse Fund, built up from light dues paid in the past.
Mr. Moore defends the latest increase by noting that dues have been held well below the rate of inflation for several years, and the new charges still will be 18 percent lower in real terms than they were in 1981-82. As a sop to the shipping lobby, he is considering whether large fishing vessels, heavy users of the Decca Navigation system, should contribute to light dues.
This is small consolation for U.K. ports that have suffered a steady erosion of traffic to their cheaper European competitors, partly due to the light dues. Before the latest increase, a large container ship entering a U.K. port paid 13,000 ($19,500) and a VLCC (very large crude carrier) 22,000 ($33,000) for a single visit. They pay nothing to sail safely into Rotterdam, Antwerp or Hamburg.
The higher rate will worsen the plight of U.K. ports. Felixstowe, Britain's biggest container port, says one of its major customers will have to pay $200,000 a year more in light dues. This will make European ports even more attractive to shipowners, particularly those with round-the-worl d services.
The announcement of steeper British light dues is good news for Antwerp and Rotterdam, which already have built up a lucrative transshipment business with U.K. exporters and importers. Latest statistics show 16 percent of the U.K.'s deep-sea, non-fuel imports and 21 percent of its exports were transshipped through Dutch and Belgian ports. Dutch ports, principally Rotterdam, transshipped 39 percent of U.K. imports from the United States, while Antwerp took another 3 percent.
Transshipment has increased sharply in the past two years and is likely to accelerate when the Channel Tunnel is opened in 1993. A rise in light dues is the last thing U.K. ports want as they struggle to halt this trend.
Ironically, the European Commission is investigating whether U.K. government grants to finance the reduction of surplus labor in London and Liverpool have distorted competition between European ports.
The immediate effect has been to block payments, of up 35,000 a man, to 400 Liverpool dockers who had applied for voluntary layoffs. More than 4,000 dockers have left the port under the government-financed scheme since 1981.
The government has until the end of February to justify the scheme before the Commission rules on whether the aid breaches the competition rules of the Treaty of Rome, the European Community's founding charter.
Meanwhile, the General Council of British Shipping is crying out for fiscal and legislative assistance for the U.K.-owned and registered fleet. The fleet has fallen from a peak of 1,614 vessels totaling 50 million deadweight tons in 1975 to 552 of 10.8 million dwt. last year, and could shrink to only 100 vessels by 1995, the council warns. The number of seamen employed has fallen from 95,000 to 33,000 in the past decade.
The government, however, has turned a deaf ear to previous calls for increased capital investment allowances and tax breaks to boost spending on ships, and Chancellor Nigel Lawson does not seem in the mood to treat the industry as a "special case."