Speech

UK Chamber of Shipping: annual dinner

This speech was published under the 2010 to 2015 Conservative and Liberal Democrat coalition government

Britain’s world class maritime sector is open for business and confirms dates for London International Shipping Week 2015.

I was delighted to be invited to join you again this evening [3 February 2014].

I believe there is no higher compliment for an after dinner speaker than to be invited back to speak again.

Initially, it was reassuring for me to know that my speech can’t have gone all that badly last year – but Ken tells me it was more a case of if at first you don’t succeed, try, try again.

And, as your tremendous support for the sailor’s society this evening demonstrates - you are a very charitable audience.

Actually, my officials were a little worried about my speech this evening.

They suggested that I should start with some jokes at my own expense.

Just to show the minister was happy to be taken down a peg or two.

But I asked them, after more than a year in the job, just how many pegs do you think there are left?

So I will be brief.

The UK Chamber of Shipping is one of the most important and influential voices of the sector with government.

So as I said earlier I’m delighted to be here.

And I would like to thank Ken for his very kind words of introduction and to congratulate him on a memorable presidential year.

Before beginning, I would also like to extend my thanks to Mark Brownrigg who has been your Director General.

Mark - your contribution to the maritime sector over the past four decades at the Chamber of Shipping has been immense.

In particular your guiding hand and expert knowledge have been at the forefront of every step that has been taken to make the UK shipping great again not least your role as a key architect of the tonnage tax scheme.

The strong relationship government has with the chamber is in no small measure down to your energy and engagement.

In your time you will have worked with one or two ministers.

And I know there will be many former ministers waiting to thank you for the tremendous personal support you have been.

Thank you therefore for all you have contributed and very best wishes for the future.

And I would also like welcome Guy – it was great to meet you the other week, and I very much look forward to working with you over the coming months.

At last year’s annual dinner I said I wanted to see a more cohesive, co-ordinated approach to the maritime sector. In short, a real partnership.

I am very pleased that you agree that, one year on, we are making progress.

Since last year we have held a series of significant round table discussions.

The result of these conversations was publication of strategic partnership plans.

That, for the first time, showed how we are working together to tackle strategic priorities and promote growth.

For example, we have been working together to help shipowners comply with the requirements of the MARPOL convention.

And indeed the inaugural London International Shipping Week was an example of partnership working in practice.

And I would like to pay tribute to the central role the UK Chamber of Shipping played in making the event a success.

As the world’s sixth largest trading nation - our economic prosperity rests on the shipping industry.

Working together to tackle challenges and promote growth.

That’s why I am absolutely committed to the strategic partnership between government and industry – not so much a case of we’re all in it together, more a case of all hands on deck.

And I know that the business environment in recent years has been challenging.

But the signs are that the global economic storm unleashed by the financial crisis, which was exacerbated by huge structural deficits of the last government, is at last receding.

As a result of the difficult decisions we have taken here in the UK, our economy is recovering.

The deficit is down by a third.

The economy grew by 1.9% last year.

The OECD now forecasts the British economy will grow by 2.5% in 2015.

Unemployment is now falling faster than many predicted.

And exports are forecast to grow by 8.5% a year over the coming decade.

And on a global scale, according to some reports by 2020 the world economy is expected to be 40% larger.

And the vast majority of the trade that will fuel growth will be carried by ship.

So, while the recovery remains fragile, when it comes to the shipping forecast - the general synopsis is rising, moderate becoming good.

This evening I would like to briefly mention what I see as 3 of the priorities for the UK in the year ahead.

The first is growing the UK shipping industry, and in particular, expanding the number of maritime training opportunities available.

I want to see more of our young people secure a job in one of the most dynamic industries in the world.

As Ken has said, it is an industry where if you are prepared to knuckle down and work hard you will get on and quickly.

At the same time, we know that for many in the maritime sector finding people with the right skills can be difficult.

Across industry, almost two-thirds of firms say finding candidates with the right skills is tricky.

That’s why we were delighted to back the SMarT scheme with an additional £3 million a year - increasing our investment to £15 million a year in total.

Last year there were 780 new officer trainees starting and forecasts suggest there will be around the same number this year.

According to the latest statistics, there were 1,990 officer cadets in training last year.

The tonnage tax is available to help increase the number of British ratings.

That’s the highest level for over a decade.

But I know there is more that can be done, particularly when it comes to ratings.

So my first priority is to work with you to help even more people choose a career in shipping.

But as well as the right skills, we need the right regulatory environment to generate growth.

I know complying with unnecessary regulation costs businesses time and money.

So, my second priority is getting rid of unnecessary regulation and cutting taxes to help you grow and invest in infrastructure you need.

That’s why the Deregulation Bill includes a clause to amend the Merchant Shipping Act 1995.

Subject Parliamentary approval, we will streamline the process so you no longer have to refer to national legislation implementing – and sometimes interpreting – the conventions agreed within the International Maritime Organization (IMO).

This means industry will only have to refer to one text and there will be no gold-plating of international regulations.

And this will ensure UK flagged ships can receive quickly the certification they require to trade freely.

In terms of our work with the IMO, I am well aware that the timing of their review of the availability of 0.5% sulphur fuel is a cause of concern for many.

Air pollution is an issue but I want to see a practical approach to implementing new rules, minimising any undue adverse impacts on industry.

You need to know enough compliant fuel is available, at reasonable cost and that’s as true in 2020 as in 2015.

I have raised these concerns with the Secretary General and we hosted an event at London International Shipping Week.

The government have submitted a paper to the IMO that will kick off discussions of an early Review at the IMO’s Marine Environment Protection Committee when it meets in March.

And the department is also working to help shipowners comply with international convention and EU Directive sulphur requirements for ships in Emission Control Areas.

We want to minimise any burdens on industry.

And that is the vital message that we are strongly promoting in the commission’s European Sustainable Shipping Forum.

And we are already providing advice and support to companies that are planning to bid for EU funding to install abatement technology or use an alternative fuel.

We also need to ensure that the commission’s proposed ports service regulation does not place burdens on efficient, unsubsidised ports.

And if it does go ahead it must shine a light on the taxpayer subsidies that distort the market elsewhere.

I am very grateful for the Chamber of Shipping’s support and advice on this issue.

Finally, I also want to make more progress on light dues.

We have frozen light dues since 2010 that’s a real terms reduction of 12%.

I want us to get to a position where further, sustainable reductions can be made.

That means sorting out things like pensions liabilities and the funding of the commissioners of Irish Lights.

We are making real progress on these points. The Irish are moving towards self-funding by April 2015.

And I expect to be able to announce that we have effectively dealt with the pension liabilities in the near future.

My third priority is developing the strategic partnership and supporting the expansion of our world-class maritime services sector.

Britain’s trading relationships with the fast growing economies outside of Europe are increasingly important to our national prosperity.

Until recently, the fast developing economies have been demanding goods - iron, steel, and concrete.

That has helped create a global commodities boom that is now coming to an end.

As these countries rebalance their economies demand will increasingly shift towards the services sectors presenting significant opportunities for exports.

Britain has world-beating firms in the maritime services sector.

More vessels are fixed through British based shipbrokers, more capital provided via London banks and funds and more vessels insured here than anywhere else in the world.

Many of you will be represented here this evening.

And I am delighted that Maritime UK has taken the lead on producing a strategic partnership plan for maritime business services.

I would also like to take this opportunity to thank Jim Stewart – you have made a significant contribution to the sector.

And welcome Jeffrey Evans to his new role at Maritime UK.

I want to help you seize the potential of these emerging markets.

Because where we are market leaders, we can’t rest on our laurels.

Later this week I will be travelling to Singapore.

A country in the premier league of global ports, with the highest trade-to-GDP ratio in the world and ambitions to grow further still.

Because places like Singapore are an opportunity.

If we go out and make case for maritime Britain, have the confidence to say that we’re world class, and that we’re open for business.

That’s what I will be doing in Singapore.

I want to work with industry colleagues on the future development of the strategic partnership plan.

And I want to understand what’s needed so we are ready by the next London International Shipping Week.

Finally, the maritime industry will be at the heart of Britain’s success in the future but it is equally important to remember its history.

This year we will be marking the centenary of the start of the First World War.

The ships and men of the Merchant Service were essential to the war effort.

But their bravery was not without cost.

In total nearly 15,000 merchant sailors from across the Commonwealth gave their lives for the country.

King George V marked that heroic sacrifice by bestowing the title of the Merchant Navy and granting a Royal Charter to the Chamber of Shipping.

Over the coming years, we will be commemorating the sacrifice made on all sides.

And I would like invite the Chamber of Shipping and the many others of you in this room who may want to be involved to consider what would be appropriate to mark the contribution of the Merchant Navy during the Great War.

With a near doubling of gross tonnage on the UK register over the past decade the British shipping industry is a success we can and should shout about.

Looking to the year ahead, what we want to see is UK shipping on the rise.

To do this we need to keep working together in partnership.

To promote Britain’s world class shipping industry and maritime business services.

That is why I am pleased to announce this evening that the government will be providing its full support to London International Shipping Week 2015 from 7 to 11 September next year.

I said last year I wanted to be an evangelist for the shipping industry.

This year, with your support, I will redouble my efforts to make Britain the best place in the world to do maritime business.

Because I believe that British shipping is a huge asset to this country.

To our economy, to our society and to our future.

Over the coming year we want to see the UK maritime sector be influential at home and overseas, continue to contribute to the recovery of our economy and above all, remain truly great!

Thank you for listening. I hope you enjoy the rest of your evening.