House of Commons Welsh Affairs Committee

Ports in Wales

Fifteenth Report of Session 2008–09

Report, together with formal minutes, oral and written evidence

Ordered by the House of Commons to be printed 27 October 2009

HC 601 Published on 6 November 2009 by authority of the House of Commons London: The Stationery Office Limited £0.00

The Welsh Affairs Committee

The Welsh Affairs Committee is appointed by the House of Commons to examine the expenditure, administration, and policy of the Office of the Secretary of State for Wales (including relations with the National Assembly for Wales).

Current membership Dr Hywel Francis MP (Labour, Aberavon) (Chairman) Mr David T.C. Davies MP (Conservative, Monmouth) Ms Nia Griffith MP (Labour, Llanelli) Mrs Siân C. James MP (Labour, Swansea East) Mr David Jones MP (Conservative, Clwyd West) Mr Martyn Jones MP (Labour, Clwyd South) Rt Hon Alun Michael MP (Labour and Co-operative, Cardiff South and Penarth) Mr Albert Owen MP (Labour, Ynys Môn) Mr Mark Pritchard MP (Conservative, The Wrekin) Mr Mark Williams MP (Liberal Democrat, Ceredigion) Mr Hywel Williams MP (Plaid Cymru, Caernarfon)

Powers The committee is one of the Departmental select committees, the powers of which are set out in House of Commons Standing Orders, principally in SO No 152. These are available on the Internet via www.parliament.uk.

Publications The reports and evidence of the Committee are published by The Stationery Office by Order of the House. All publications of the Committee (including press notices) are on the internet at www.parliament.uk/parliamentary_committees/welsh_affairs_committee.cfm.

Committee staff The current staff of the Committee is Dr Sue Griffiths (Clerk), Alison Groves (Second Clerk), Carys Jones (Committee Specialist), Anwen Rees (Inquiry Manager), Christine Randall (Senior Committee Assistant), Annabel Goddard (Committee Assistant), Tes Stranger (Committee Support Assistant) and Rebecca Jones (Media Officer).

Contacts All correspondence should be addressed to the Clerk of the Welsh Affairs Committee, House of Commons, 7 Millbank, London SW1P 3JA. The telephone number for general enquiries is 020 7219 6189 and the Committee’s email address is [email protected].

Ports in Wales 1

Contents

Report Page

Summary 3

1 Introduction 7 Our inquiry 7 Ports Policy 8 Welsh ports—operations 8

2 Opportunities for growth 12 The cruise market 12 The market 12 Potential economic impact 13 Barriers 15 Challenges 16 Supply chains 18 Logistics 19 Short-sea shipping 20 Energy Sector 21 The role of government 23 A distinctive Welsh approach 24 Grant Funding 26

3 Infrastructure 28 Policy framework 28 Impact of policy decisions on the freight sector 29 Land transport 31 Cross border co-operation 32 Roads 33 New links from the ports 35 Rail 36 Planning 37 Strategic and land use planning 37 Land use conflicts 39 Environment 40 Severn Tidal Power 40

4 Security and border controls 42 Policy and legislation 42 Threats 43 Risk Assessment 43 Police and border control staffing at ports 45 Milford Haven 46 Co-operation 47 Common Travel Area 48

2 Ports in Wales

5 Conclusion 49

Conclusions and recommendations 51

Formal Minutes 59

Witnesses 60

List of written evidence 61

List of Reports from the Committee during the current Parliament 63

Ports in Wales 3

Summary

Ports are vitally important economic resources for Wales, playing a key role in the movement of both freight and people and providing essential international trade links. However, our inquiry has found that Welsh ports are under-exploited resources that could play a much greater role in Wales’s economic development. We recommend that the Government should take action in a number of specific areas in order to draw the full benefit from Wales’s diverse and flexible ports, particularly at this time of recession.

The need for a coherent ports strategy

Ports policy is a reserved matter falling within the remit of the Department for Transport, but many policy areas which have a significant influence on port operations, such as transport facilities and services, economic development and land use planning, are the devolved responsibility of the Welsh Assembly Government. Our inquiry found that the Department for Transport and Welsh Assembly Government have very different approaches to port development. The former supports an approach that lets the market lead investment, whilst the latter supports greater government engagement. A fully co- ordinated approach to ports policy is necessary to ensure that their economic benefit is maximised and that port operators, local authorities and others have shared and coherent objectives.

Steps to delivery

Government at all levels must use its powers in a complementary and focused way to achieve the agreed outcomes that will lead to an expansion in the port sector. In this context, we would expect the Department for Transport to follow through its stated commitment to local decision-making in the creation of locally relevant policy and we recommend that the Department for Transport and the Welsh Assembly Government develop a distinctive ports policy for Wales to identify where investment should be targeted to enable the sector to thrive.

Role of the Wales Office

Given the administrative division of reserved and devolved matters relating to ports, we believe that the Wales Office should play a much greater and more proactive role in facilitating and encouraging co-operation between the Welsh Assembly Government and relevant central government departments. The Wales Office must ensure that it is doing everything possible to represent Welsh interests within Whitehall. The Wales Office does not have the technical expertise to deal with many of the specific issues involved, so a robust and direct working relationship must be established between the Department for Transport and the Welsh Assembly Government. It is essential that the Department of Transport should have a clear understanding of Welsh needs and priorities in order to ensure that the right support is on offer. The personal role of the Secretary of State for Wales in particular—as well as the Wales Office as an institution—is crucial. He must make sure that in this area of policy such relationships

4 Ports in Wales

are established, maintained and work well. This is, of course, the key role of the Secretary of State and his team across all areas of Government policy and interaction.

Cruise market: tourism and leisure

Our inquiry confirmed that there is a significant opportunity for Wales to capitalise on the growth of the leisure cruise market and growing demand for new cruise destinations. Cruise-based tourism can have an enormous impact on local economies, as evidence from successful initiatives elsewhere (such as Cruise Baltic, which brings together ten Baltic countries) has clearly shown. At present, the cruise market in Wales is being held back by the lack of facilities for liners to berth alongside the port. This could be resolved at relatively little cost compared to the economic benefit that might accrue from putting Wales on the cruise map. During our inquiry, we heard of the Celtic Wave project which has attracted European funding for Welsh and Irish ports to work together to market the region as a cruise destination; and work undertaken by the Welsh Assembly Government to study the improvements that would be needed to transform the port of Holyhead into an attractive stop for cruise liners.

Steps to delivery

Recent initiatives are welcome, but more ambition must be shown in order to exploit the full potential of the cruise market. For this to happen, the Department for Transport needs to fully support targeted investment in Welsh ports, in spite of its historic reluctance to intervene in the sector. The identified investment should proceed now in order to attract cruise operators who have a 3–4 year forward planning period.

Understanding the supply chain

Most Welsh ports have spare capacity and are well placed to take advantage of changing supply-chain and distribution practices, such as the increased use of feeder ships to transfer goods from major hub ports. By developing short-sea shipping or feedering services, Welsh ports could offer alternatives to road transport, which is environmentally damaging and increasingly time dependent as traffic levels rise and roads become more congested.

Steps to delivery

The Wales Freight and Ports Group has been working effectively to create a better understanding of logistics chains and the movement of goods and to share market intelligence. This needs to be extended through a co-ordinated ports policy for Wales shared between the Welsh Assembly Government, the Department for Transport and the industry. Department for Transport officials should participate in the Wales Freight Group, if the group believes this would enhance the Department’s understanding of the challenges facing the Welsh ports and wider freight sector.

Energy sector

Ports also have a central role to play in the energy sector. Milford Haven, for example, has grown to become one of the most important locations for the sector in the UK. The growth

Ports in Wales 5

in renewables could provide new opportunities for ports, both as locations for energy generation installations and in terms of the supply and distribution of fuels and equipment.

Steps to delivery

This requires co-ordinated action from the Government and the Welsh Assembly Government to develop a more strategic approach to the ports of Wales, identifying spare capacity and opportunities for the future. Again, the Secretary of State for Wales needs to play a proactive role in developing such coordination and ensuring that it is maintained effectively in practice in the long term. Renewable energy developments in the Severn Estuary could significantly impact on the tidal regime in the estuary, which in turn could affect the operations of the ports in Cardiff and Newport. Provided that adequate locking facilities are built in, not all these implications would necessarily be negative. The UK and Welsh Assembly Governments should give careful consideration to the potential impact of any development in this area on the South Wales ports, together with the Wales Freight Group.

Cross-border connectivity

Inland road and rail links are crucial to the development of ports. Wales suffers from poor quality routes to many of its ports and witnesses were concerned that there was insufficient cross-border co-operation on transport issues. A lack of strategic planning for investment in key routes by the English regions can have a significant impact on routes into/out of Wales. Although there is sufficient spare capacity at Welsh ports to handle increased levels of freight in the future, this could be severely constrained by inadequate surface links in other parts of Wales.

Steps to delivery

Transport links to ports need to form a central part of transport planning locally and regionally. The Department for Transport and the Welsh Assembly Government must work together to address cross-border rail and road issues affecting ports. Greater cross-border co-operation on this issue is essential and should form part of an integrated transport policy that covers all modes of transport. Again, the Secretary of State for Wales needs to play a proactive role in developing such coordination and ensuring that it is maintained effectively in practice in the long term.

Security

All port activities are fundamentally reliant on the safety of the people and goods moving through them. Wales’s ports are key points of entry into the UK for goods and passengers, providing a range of passenger ferry services, which will be further extended by the resumption of the Swansea-Cork link from 1 March 2010. Witnesses highlighted the potential threat to the UK’s security as a result of ‘high risk’ passengers being able to travel easily from the Republic of Ireland to the Welsh ports.

6 Ports in Wales

Steps to delivery

Co-operation among the range of organisations that help secure Welsh ports needs to be strengthened to ensure that Welsh ports are not seen as an easy point of entry into the UK for those undertaking illegal activity or travelling illegally. Accurate information and intelligence should be shared swiftly between relevant organisations to minimise this threat. We are not convinced that the significant additional pressure that has been placed on the local police force by the expansion of Milford Haven in recent years has been reflected in resource allocations. We recommend that additional resources be made available to Dyfed Powys Police to enable it to undertake these activities. These resources must be proportional to its additional responsibilities and must reflect the importance of Milford Haven to the whole of the UK.

Ports in Wales 7

1 Introduction

Our inquiry

1. Our inquiry into ports in Wales follows on from our work on cross-border transport services, on which we published our report in July 2009. During this earlier inquiry we studied the cross-border connectivity of the Welsh transport network, including road, rail and air travel. We found that the connectivity of the Welsh transport network and efficiency of these links affects the movement of freight (both road and rail) and passengers to and from Welsh ports.1 We therefore decided to conduct an inquiry specifically into ports in Wales.

2. Transport facilities and services are the devolved responsibility of the Welsh Assembly Government. Ports policy, however, is a reserved matter and falls within the remit of the Department for Transport. This also includes ensuring port operators comply with legislation for the security of ports.

3. During the first part of this inquiry, we examined the effectiveness of existing arrangements and co-operation between the Department for Transport and the Welsh Assembly Government on policy issues of relevance to ports. We also looked at the importance of Welsh ports both to their localities and to the wider economy; the current barriers to their development and opportunities for the future, within the context of connectivity with the wider transport infrastructure. We studied the movement of freight; the role of ports within economic development and land use planning; and future opportunities for ports, with a particular emphasis on the cruise market. In the second part of our inquiry we examined security issues at Welsh ports, concentrating on policing, border control arrangements and co-operation between relevant authorities.

4. We received oral evidence and written submissions from a wide range of organisations including port operators, ferry companies, local authorities, the freight sector, cruise companies and authorities dealing with security and border control at Welsh ports. We also received oral and written evidence from Ministers in the Department for Transport and the Welsh Assembly Government. The evidence we collected is appended to this report. We are grateful to our specialist advisers Professor Stuart Cole, Wales Transport Research Centre, University of Glamorgan, and Dr Khalid Bichou, Port Operations Research and Technology Centre, Imperial College London.2 We congratulate Professor Cole on twenty-five years of service to the committee and we take this opportunity to thank him for the invaluable assistance he has offered over the years. During our inquiry we visited the Port of Holyhead and the Baltic Ports in Tallinn, Helsinki and Stockholm. Our specialist advisers also visited the ports in Cardiff and Milford Haven on our behalf.

1 Welsh Affairs Committee, Tenth Report of Session 2008-09, Cross-border provision of public services for Wales: Transport, HC 58. 2 See Formal Minutes of the Committee for 31 March 2009 at http://www.parliament.uk/documents/upload/FormalMinutesWAC0809.pdf

8 Ports in Wales

Ports Policy

5. The Department for Transport’s Modern Ports: A UK policy was published in 2000. It outlined the Department’s aims for ports, which included promoting better regulation of the industry; promoting agreed national standards and good practice for port management and port operations; making the best use of existing and former operational land; and securing high environmental standards whilst supporting sustainable projects where there is a clear need.3 A 2006 review of ports policy,4 asking for views on government intervention, was followed by an interim report in 2007 which re-emphasised the Department’s long-held policy of general non-intervention in the ports sector, based on the market’s ability to fund further expansion if required.5

6. A 2007 inquiry into the Ports Industry in England and Wales by the Transport Select Committee concluded that the Government should direct the development of ports to a greater extent, and called for:

A national strategy that recognises the regional context and looks to balance national trade requirements with the local imperatives of regeneration, employment and environmental protection … if it does not, it makes no difference where ‘the market’ decides to develop port terminals, as goods will remain stuck on congested roads or blocked by dilapidated canals and railways.6

7. The Welsh Assembly Government’s Wales Freight Strategy recognised the importance of ports in facilitating the movement of freight.7 The strategy highlighted some ‘steps towards delivery’ which the Welsh Assembly Government would like to progress, but which contained no funding commitment. These included:

Given the UK (and wider) nature of ports and shipping policy, the Welsh Assembly Government should continue to work with the DfT to develop an active policy on the future of ports, in order to help ensure that future development takes place in a sustainable way.8

Welsh ports—operations

8. Our inquiry concentrated on the Welsh ports that deal with larger volumes of freight. We recognise that smaller ports and harbours around Wales make a contribution to the sector through the transport of smaller volumes of freight and by supporting the marine leisure industry. Harbours and docks for use by the fishing industry, for recreation or for communication between places in Wales are the devolved responsibility of the Welsh Assembly Government, and our inquiry did not examine these issues.

3 Department for Transport, Modern Ports: A UK policy (2000) 4 Department for Transport, Ports Policy—your views invited (2006) 5 Department for Transport, Ports Policy Review Interim Report (2007) 6 Transport Committee, Second Report of Session 2006-07, The Ports Industry in England and Wales, HC 61 7 Welsh Assembly Government, Wales Freight Strategy (2008) 8 Ibid.

Ports in Wales 9

9. Welsh ports are diverse. Milford Haven (including Pembroke Dock), Holyhead and Fishguard handle roll-on roll-off and ferry traffic from Ireland. In addition, an announcement was made after we had finished taking evidence for this inquiry that the Swansea–Cork passenger ferry service will resume from 1 March 2010. Milford Haven also handles significant energy sector traffic and resources. The majority of throughput at Port Talbot, Swansea, Cardiff, Barry and Newport is dry and liquid bulk, forest products, iron and steel products and some limited container traffic.9 The Port of Mostyn deals with general cargo, specialist equipment for renewable energy installations and the Airbus A380 wings manufactured at Broughton.10 Table 1 provides further information on the main operations of the largest Welsh ports.

10. In 2008, the total amount of freight that travelled through UK ports was 564 million tonnes. The leading UK ports of Grimsby and Immingham, London, Tees and Hartlepool and Southampton each handled 65.3, 53, 45.4 and 41 million tonnes respectively. The figure for Milford Haven was 35.9, with Wales overall handling 54.4 million tonnes.11

11. Milford Haven represents a significant proportion of the total freight handled by Welsh ports and approximately 10% of the UK’s total of 564 million tonnes in 2008. However, without the contribution of Milford Haven, the volume travelling through Welsh ports is nearer 4%.12 Approximately 100 million tonnes of freight are transported through Wales each year by different modes, which accounts for around 5% of all freight transport in the UK.13 The Welsh Assembly Government’s 2008 Wales Transport Strategy14 refers to the role of ports in bringing goods and people in and out of Wales:

Milford Haven is the fourth largest port in the UK in terms of tonnage and the busiest for oil products, a sector set to grow following completion of the Liquefied Natural Gas (LNG) terminal and supply line.

Newport and Port Talbot are also significant, with the former being the busiest UK port for iron and steel, and the latter the third busiest for ores. Significant tonnage also flows through Cardiff, Barry and Swansea.15

12. In 2007, Holyhead saw the second highest numbers of short sea passengers in England and Wales at 2.1 million. Total numbers for the UK were 23.6 million, with Dover accounting for 14.2 million of those movements.16

9 Ev 74 10 Ev 164 11 Department for Transport, Provisional Port Statistics (2008) 12 Ev 153; 158-159 13 Welsh Assembly Government, Wales Freight Strategy (2008) 14 Welsh Assembly Government, Wales Transport Strategy (2008) 15 Ibid. 16 Department for Transport, Maritime Statistics (2007)

10 Ports in Wales

Table 1: Welsh ports – operations and ownership

Name Ownership Location & Transport links Operations / Cargo Newport Associated Mouth of the River Usk; Timber, cars, non-ferrous metals, British Ports PLC Severn Estuary / Bristol building materials, steel, minerals Channel; near J28 M4. and ores especially coal, grain, Road and rail links. animal feed, sand, forest products. Limited cruise market but with potential. Cardiff Associated Mouth of the River Taff Containers, dry bulk forest British Ports PLC south east of the Cardiff products, fresh produce, general Bay development; Severn cargo and steel. Limited cruise Estuary / Bristol Channel. market but with potential. Road and rail link; single carriageway to M4.

Barry Associated Near Barry town; Severn Dry bulks, containers, forest British Ports PLC Estuary/Bristol Channel. products, general cargo including Limited capacity road and roll-on roll-off, liquid bulk, steel, rail links recycled materials Port Talbot Associated Adjacent to M4 with direct Mainly Corus imports of coal and British Ports PLC access. iron ore, third party coal for power Road and rail link stations; processed slag. The port has one of the deepest berths in the UK (tidal harbour).

Swansea Associated Seaward end of Severn Dry bulks, coal, plywood, steel, British Ports PLC estuary; east of Swansea copper, roll-on roll-off. city centre. Limited cruise market but with Direct Road to M4 and potential. Passenger ferry to Cork direct rail connection. will resume from 1 March 2010. Milford Haven Milford Haven Both sides of the Cleddau Oil, liquid natural gas, roll-on roll- Port Authority (a estuary. Milford Haven on off cargo from Ireland. Major link trust port) North Bank and Pembroke to Ireland with Irish Ferries. Port and Chevron Oil refinery to the South. Marina development. Direct rail link with low line speeds and single track in some places. Limited capacity road links; 28 miles from dual carriageway. Fishguard Stena Line Ports West Pembrokeshire Coast. Roll-on roll-off cargo. Ltd Single carriageway road link and rail for foot passengers Holyhead Stena Line Ports Ynys Môn. Roll-on roll-off cargo off via Stena Ltd Road link to A55 Line and Irish Ferries, and foot expressway and rail link. On passengers; deep water quay side Trans European Network. bulk facility. 7/8 cruise ships per annum, from 15 per annum in 2006. Mostyn Private Dee estuary. General cargo and airbus A389 ownership North Wales main line wing transfer facility. Roll-on roll- adjacent. Road link to A55 off for accompanied and expressway/ main unaccompanied trailers. motorway network.

Ports in Wales 11

13. The traditional role of ports has been the transfer of goods between surface transport modes (road and rail) and waterborne transport. However, evidence we received from the Chartered Institute of Logistics and Transport (UK) Cymru noted that this role now includes storage and warehouseing for imports, exports and domestic traffic, value-added activities such as final processing as well as the traditional role of transferring goods to other surface transport modes.17 Ports can act as distribution hubs and the extent of their activities can create employment opportunities and economic growth.18 The operations of ports make a significant contribution to the Welsh economy:

The activity of Associated British Ports and its tenants in South Wales directly and indirectly support £79.8 million per annum with a GVA of £34.2 million, and the activities of ABP’s port tenants account for an estimated 9,711 FTE jobs, with a direct and indirect output of £2.78 billion and GVA of £902.5 million (2% of the Welsh total).19

17 Ev 77 18 Ev 78-80 19 Ev 67

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2 Opportunities for growth

14. During our inquiry, witnesses told us that there are many opportunities for Welsh ports, despite the vulnerability of certain ports as a result of the economic downturn. Witnesses have said that the diversity of the Welsh ports’ operations means that they “can take the ups and downs in economic activity” and that “the time we are in at the moment means that there is great potential for Welsh ports in general to expand the range of activities that they undertake”.20 According to Dr Anthony Beresford of Cardiff Business School:

There are opportunities for capturing new traffic, or developing existing flows, in Ro-Ro and cruise shipping. Likewise, land-land logistics, exploiting the road and rail networks and strategic industrial sites on the dock estate, could be further exploited to supplement and compliment existing sea-land logistics services.21

The cruise market

The market

15. The leisure cruise market has shown substantial growth in the last ten years with demand for cruise holidays almost doubling during this period.22 In 2008, the number of UK passengers taking cruise holidays increased 11% to almost 1.5 million. By 2012 it is estimated that this number will increase to almost 2 million.23 Cruise Wales,24 told us that the potential in Wales is significant:

Only 3% of the US population [is] currently cruising and in the UK only 2%. Furthermore, other European markets are seeing large growth in the cruise sector. Notably, Germany [has] grown by 19% in 3 years, Spain by 24% and Italy by a staggering 49%. In ten years from 1995 to 2005 the number of Europeans cruising trebled and this is predicted to continue apace.25

To illustrate further this growth, Fred Olsen Cruise Lines, a private cruise company, told us that it has increased its passenger capacity by 40% in the last 12 months.26

16. In written evidence, Cruise Wales told us that cruise companies are always looking for new destinations, and that Welsh ports could form part of a number of cruise itineraries, including the Irish Sea cruise, the round British Isles cruise, the Celtic Fringe cruise, the

20 Q2 21 Ev 73 22 Ev 81 23 Passenger Shipping Association, available at: http://www.the-psa.co.uk/default.asp?PID=6&PPID=6 24 Cruise Wales is a partnership co-ordinated by the Welsh Assembly Government whose role is to promote the cruise market in Wales to cruise companies and identify development opportunities. The partnership comprises the Welsh ports, local authorities and tourism sector. 25 Ev 81 26 Q184

Ports in Wales 13

Irish Sea and Iceland cruise and the Irish Sea to/from North America cruise.27 Mrs Margaret Llewellyn of Cruise Wales told us “we want [Wales] to be the next Baltic!”28

The Baltic Cruise Market

On our visit to the Baltic, we met a number of organisations involved in the cruise market in Tallinn, Helsinki and Stockholm. Cruise Baltic is an initiative which brings together ten Baltic countries to market the region as a destination. We were told that the Baltic is the third most popular cruise destination in the world, and has experienced the most rapid growth in recent years. Annual passenger numbers have increased by an average rate of 13% between 2000 and 2008 against the cruise market’s global annual growth of 8%. The numbers of passengers to the Baltic increased from 1.79 million in 2004 to 2.8 million in 2008. Each of the three ports we visited saw more than 250 cruise ship calls in 2008. Cruise tourism generated €444 million in the Baltic in 2006.29 During our visit to the Port of Stockholm, we heard that the cruise market is estimated to be worth between €40–€45 million to the local economy, based on the visits of 300 vessels per annum.

Potential economic impact

17. Passengers on cruise ships visit local attractions when they arrive at a destination. The cruise companies themselves organise excursions for the passengers, which will usually include a half day or a full day’s visit. The evidence we received clearly suggests that Wales is well placed to offer passengers a varied and interesting choice of places to visit.

18. The potential economic benefits from passenger spend during visits ashore is substantial. Various witnesses quoted different figures, but experiences elsewhere have demonstrated the scale of economic benefits to the local economy as a result of such visitor spending. Mr Ted Sangster from Milford Haven Port Authority told us that the estimated spending for cruise passengers was £80–£100 per person, with crew members spending £30 each during visits ashore.30 The Saga Shipping Company told us that on an average port call, passengers on the Saga Ruby (which visited Cardiff during 2008) spend in the region of £30,000 on shore excursions.31

19. Ynys Môn County Council noted that in recent years an average of between five and ten cruise ships per year have called into Holyhead. Most of these have carried a few hundred passengers, but there have been several calls by larger ships with around 2,000 passengers. Passengers from these ships have tended to go on day or half-day coach excursions, generating an income for the cruise companies. However, “typically 25% of passengers from large ships will not go on coach excursions and will walk around the town or visit other places by taxi. Many crew members will also come ashore and spend in local

27 Ev 81 28 Q170 29 Cruise Baltic available at: http://www.cruisebaltic.com 30 Q114 31 Ev 130

14 Ports in Wales

shops”.32 The profiles of passengers on cruise liners will vary, which means that their expenditure levels are likely to vary. The average age for cruise passengers is decreasing, which means the market is expanding and becoming more diverse in terms of the types of activities they are likely to want to undertake onshore.33

20. The cruise market is estimated to be worth between €40–€45 million to the local economy in Stockholm, based on the visits of 300 vessels per annum; almost one cruise ship visit per day. Mrs Margaret Llewellyn of Cruise Wales told us that in Wales, a minimum of 30-40 cruise ship visits per year are needed to justify investing in the facilities required to by the cruise lines.34

21. In 2007, Liverpool City Council opened a cruise terminal costing £20 million. Funding was provided by a partnership that included the North West Development Agency, EU Objective One funding, Government Office North West, Liverpool City Vision, City Focus and the Mersey Docks and Harbour Company (which became Peel Holdings), which made a capital contribution to the scheme. As a result of this development, visiting cruise ships can now dock at the quayside. Facilities include coach parking, a passenger waiting area and reception building and coach access. The facility is owned by Liverpool City Council and profits are used to manage, maintain and operate the facility. Since opening this terminal, the city has been able to attract a growing number of cruise ships, with visitor numbers exceeding the City’s expectations. Information provided by Liverpool City Council indicated that in 2007, seven cruise liners visited the city with an economic impact of £451,000, in 2008 the impact from fourteen visits was £1.3m and in 2009 the expected impact from sixteen liners is £1.7m.

22. The cruise market hinterlands are not restricted to the area immediately adjacent to the port but take in areas up to 1–1.5 hours by coach from the port. Indeed, evidence from the Port of Mostyn raised concerns that very little of the passenger spending filters through to the local economies because “most passengers will be whisked away from the ship by coach to the particular cultural location ... and returned to the ship without visiting the port’s local town or city”.35 In the case of Holyhead, the hinterland would extend into Gwynedd, Conwy and Denbighshire as well as Ynys Môn. For Milford Haven the hinterland would be as extensive as Pembrokeshire, Carmarthenshire and Ceredigion.36 In Liverpool there is a concentration of locations of interest to visitors within the city and the wider region.37 The relevant authorities must work together in Wales to ensure that the passengers who currently visit Wales on cruise liners spend their money in the hinterlands of the particular port of call. If improved facilities are developed in Wales, it will be essential that this co-operation continues.

32 Ev 108 33 Q172 34 Q159 35 Ev 116 36 Q178 37 Q188

Ports in Wales 15

Barriers

23. At present there is a lack of modern facilities for cruise ships visiting Wales, most notably a berth that would enable vessels to dock alongside the quay. Mr Matt Grimes from Fred Olsen Cruises told us that “as a cruise line we recognise Wales as being a ‘must see’ destination. It is just that we do not have the means to be able to get the ships in there. That is the great shame”.38 Such facilities are available in other ports in the UK, which means Welsh ports are unable to compete. For example, witnesses believed the port of Holyhead had lost cruise trade as a result of the better facilities on offer in Liverpool.39

24. Because of the lack of facilities that enable cruise liners easy access to the ports, those visiting Wales face a number of challenges. At Milford Haven, for example, passengers have to be tendered to the shore by boat. At Holyhead, smaller cruise ships berth alongside the inner harbour, but larger ships must anchor outside the port and transport their passengers ashore using smaller boats. Carrying passengers ashore in this way can be time consuming and uncertain, dependent on weather conditions,40 and the industry is moving away from this approach: “some of the newer cruise ships ... do not have tenders so they will never be able to come to a port which is just an anchorage”.41 Other ports such as Cardiff, Newport and Swansea are attractive to cruise companies because of the variety of activities these areas offer passengers, but ships must negotiate a lock to access these ports. This is subject to very accurate timing and risks damaging the ship. Whilst some witnesses felt that this can often put liners off visiting these ports, they are suitable for a certain size of ship.42 Swansea, for example, can accommodate cruise ships with up to 950 passengers. During our inquiry, we heard about a cruise ship with 800 passengers visiting Newport for the first time.43

25. Fred Olsen Cruises told us that very little in the way of additional facilities is needed to make a port attractive. They cite the essential requirements as being: “a safe approach in a wide range of conditions; towage available but not compulsory; a sufficiently long, well- fendered berth, in good condition, free of hazards; an area immediately adjacent to the vessel in which to marshal and dispatch excursion coaches and shuttle buses; fast and efficient customs and immigration clearance”.44

26. Cruise based tourism can bring significant benefits to local economies. A limited number of cruise liners already visit Welsh ports but their frequency is constrained by the lack of appropriate facilities for them to berth safely. This could be resolved at relatively little cost compared to the economic benefit that might accrue from putting Wales on the cruise map. There is a significant opportunity for Wales to capitalise on the growth of the cruise market and demand for new cruise destinations, but co-

38 Q196 39 Q166 40 Ev 108 41 Q179 42 Q169 43 Q326 44 Ev 86

16 Ports in Wales

ordinated work and investment will be required to deal with existing constraints and enable Wales to benefit from the projected growth of the cruise market.

Challenges

27. Developing the facilities required to attract cruise ships to Wales will incur a substantial cost. Port operators are unwilling to meet such costs because the return to them from cruise ship visits is minimal; they receive a nominal fee for the use of their facilities. The main economic benefit from the cruise market is to the local areas visited by the cruise ships and, of course, to the cruise companies themselves.

Cruise ships do not tend to be huge revenue generators for ports; they are fairly limited. But they are potential huge revenue generators for the local authorities and for the local cities in terms of their offering. Whilst we have those facilities available to us we are actively encouraging that because that helps with the economic development of the areas around which and in which we are operating.45

28. The Port of Holyhead has made some progress in exploring how existing facilities can be improved to attract more cruise ships. In February 2009, the Welsh Assembly Government announced that feasibility work was underway for an along-side cruise berth on an existing industrial jetty at Holyhead for cruise liners, with the aim of making the facility ready for the 2010 holiday season.46 The partnership approach adopted to investigate opportunities at Holyhead was welcomed by witnesses. We were told that this work would not have been possible without the participation of the private sector, namely Stena Line as the owner of the port, and Anglesey Aluminium as the owner of the jetty. Mrs Margaret Llewellyn of Cruise Wales told us that without this co-operation, the work would have had to start from a zero base and the costs of developing a facility would be “a minimum of probably £40 million”.47

29. We heard that the most likely approach to be adopted in Holyhead is the construction of a ‘dolphin’ extension to the existing jetty, along with adequate coach parking and a bridge for coaches to the landside area. A ‘dolphin’ is a narrow strip of concrete constructed at the same level as the jetty surface with room for a walkway. This would enable larger ships of up to 2000 passengers to berth as compared with smaller ships at the jetty itself.48

30. The Welsh Assembly Government’s study has assessed the likely cost and investment needed from the public sector to develop the required facilities at Holyhead. For the project to come to fruition, public funding will be needed. There are a number of challenges which would need to be overcome before public funding could be justified, including issues of EU rules on state aid and distortion of the market, 49 but we were told that work is being done

45 Q112 46 Welsh Assembly Government Press Release, New Moves to Attract Cruise Liners to Holyhead, 16 February 2009 available at: http://wales.gov.uk/news/latest/2960880/?lang=en 47 Q159 48 Q158 49 Under EU rules, government intervention should not distort competition between private companies or impact on their competitiveness.

Ports in Wales 17

to overcome these problems. We also heard from the Welsh Assembly Government Minister for the Economy and Transport that his department was working with Cruise Wales to identify the necessary transport and regeneration input to enable the jetty to be developed.50

31. Work is also being undertaken to investigate the potential for a similar development at Milford Haven.51 Cruise Wales told us that if Milford Haven and Holyhead built alongside facilities they would be able to handle any cruise ship in operation. Cruise ships of over 300 metres and carrying in excess of 3,000 passengers are being introduced into the northern European market and having the facilities available to be able to attract these would be of great benefit to Wales.52

32. Cruise companies need a long lead time to plan their itineraries and advertise these to customers. Work to develop the jetty at Holyhead should start as soon as possible, and efforts will need to be made to quickly find ways of overcoming problems associated with state aid.

33. The lack of quayside facilities for ships mean that, at the moment, other ports in the UK and Ireland are more attractive to cruise companies than those in Wales. Investment is needed to develop these facilities; the Department for Transport should assist the Welsh Assembly Government’s efforts to ensure that this happens as soon as possible. The Welsh Assembly Government should continue to work with the cruise companies through Cruise Wales to ensure that any facilities developed in Wales meet their requirements in the medium to long term.

34. The Cruise Wales partnership works hard to raise the profile of the whole of Wales as a cruise destination, and to gain a better understanding of the needs of both the cruise lines and their customers. We welcome the recent announcement of £1.2 million in European Funding for the Celtic Wave which will enable the ports of Holyhead, Milford Haven and Swansea to work with their counterparts in Dublin, Waterford and Cork to market the region as a cruise destination. However, more ambition must be shown in order to exploit the full potential of the cruise market. Promoting Wales as a destination along with other Celtic/Irish Sea ports must be a priority so that the cruise lines can include Wales in their itineraries as soon as possible. The UK Government should support this work so that the UK as a whole can offer a more diverse range of itineraries to cruise companies.

35. There was a lack of clarity from the Department for Transport on the issue of public funding for cruise facilities. The written evidence stated that the Department believed the cruise market should be developed without public subsidy.53 However, in oral evidence, Mr Paul Clark MP, Parliamentary Under Secretary of State for Transport, expressed his support for the exploratory work being undertaken by the Cruise Wales partnership: “I think it is absolutely critical to ... try and develop and capitalise on that market and we are

50 Q328 51 Q326 52 Ev 81 53 Ev 156

18 Ports in Wales

certainly supportive of that”.54 Mr Robert Davies from the Department for Transport also indicated that issues of competitive distortion as a result of public subsidy were complex: “if you do something at one port, it actually helps another, but in other cases, if you do something at one port it can divert the traffic from another”.55

36. Developing the cruise market in Wales will benefit the whole of the UK. By improving the facilities in Wales, more UK based cruise itineraries can be created but this will require public investment. We are concerned that the lack of clarity from the Department for Transport about the scope and availability of public funding for cruise facilities could affect ambitions to develop Wales as a cruise destination. The Department’s policy of non-intervention in port development should not apply in this context. The market will not invest in a capital scheme for developing cruise facilities because of the low rate of return to the port operators from cruise operations. We are concerned that the Department for Transport has not given sufficient consideration to the benefits to local and regional economies from cruise tourism.

Supply chains

37. In its evidence, the Department for Transport highlighted where future growth for ports is forecast:

The main growth sectors are in containers and roll-on roll-off services, demand for which has been forecast to more than double by 2030. The growth is mostly import- led ... growth in bulk and general traffic is much slower. An exception is liquefied natural gas, a major import at Milford Haven, which is expected to grow rapidly but from a small base.56

38. While these trends provide opportunities for Welsh ports, Mr Robin Smith of the Rail Freight Group warned that:

At the moment, because of the patterns of international trade, it is not seen that there are likely to be any significant increases in demands within South Wales or North Wales ports. Growth, yes ... but not significant changes in patterns.57

39. The Freight Transport Association highlighted a number of changes within the freight and logistics industry over the past 10 years: internet and web-enabled supply chain management tools; advances in stock control and inventory management systems; industry consolidation; and retailer-led supply chain dominance.58 Most importantly, the Association suggested that “the rate of change in the freight and logistics industry in the next ten years will at least equal, if not exceed that of the last decade”.59

54 Q294 55 Q299 56 Ev 154 57 Q82 58 Ev 92 59 Ibid

Ports in Wales 19

Logistics

40. In the course of our inquiry, witnesses told us about the economic impact that developing value-added activities on or near port estates, such as logistics or distribution centres, can have. Investment in logistics facilities by ports across the UK have been successful in terms of providing employment opportunities and economic benefit to local economies and witnesses felt that there were significant opportunities to develop this aspect of ports’ business in Wales. For example, Mr Matthew Kennerley from Associated British Ports South Wales told us that there were opportunities in Cardiff and Newport to develop more unit-load business and encourage inward investment to develop facilities for logistics and distribution.60 Mr Callum Couper, Chair of the Wales Freight Group, suggested that added value activities such as stripping containers, could happen in Wales. He told us that by building the right facilities in Wales, some of the ‘legs’ of the distribution chain could be removed.61

41. Witnesses have recognised that ports are under-utilised and that there is spare capacity and potential to expand the business through Welsh ports.62 We heard that there is potential for growth, but before “any money is spent or any decisions are made about how things should be administered, you have to do adequate demand forecasting”.63

42. The Road Haulage Association raised concerns regarding the adequacy of the ports’ land-side infrastructure to deal with increased activity, and the investment costs required. The Association stated: “clearly, for the sake of the Welsh economy, such improvements could be greatly facilitated by use of grants”.64 We were also told that in a peripheral location such as Wales, it is imperative that logistics chains are as efficient as possible to keep costs to a minimum.65

43. Dr Anthony Beresford of Cardiff Business School called for a better understanding of not only the logistics chains but also the movement of the actual goods. He believed this would help the Welsh Assembly Government to understand what ports should be doing and where government can help.66 Mr Callum Couper, Chair of the Wales Freight Group, called for a better understanding of the market and intelligence sharing.67

44. Ports are a key link in the supply chains in the UK. Overseas manufacturers and freight forwarders will look at the total supply chain from the point of origin to the final destination. The UK and Welsh Assembly Governments need to be aware of the relationship between logistics and supply chains and the location of jobs. Furthermore, the Welsh Assembly Government should ensure that it understands what the market

60 Q116 61 Q35 62 Q311 63 Q75 64 Ev 124 65 Q3 66 Q23 67 Q28

20 Ports in Wales

requires by undertaking demand forecasting to inform policy development and assist the Welsh ports to increase their business.

45. We recommend that the Welsh Assembly Government undertakes a review of spare capacity at Welsh ports. This would help identify the transport and infrastructure improvements needed to facilitate more freight movements through Welsh ports. The freight sector needs a long lead-time to plan operations. We suggest that this activity should, therefore, start as soon as possible.

Short-sea shipping

46. Reliance on import flows from the Far East has influenced the development of container ports in the UK. Container ships have increased in size which means that fewer ports are able to accommodate them. In the UK, the main container ports are Southampton and Felixstowe. Freight is taken from these container ports by road or rail to its destination. Transporting goods by road is environmentally damaging and increasingly subject to delay as traffic levels rise and roads become more congested.68 In written evidence, DG TREN (the Directorate-General for Energy and Transport) of the European Commission explained the emphasis it places on encouraging the modal shift of freight from roads to the sea for environmental reasons.69 These problems of higher costs and reduced reliability of long haul road haulage from the south east of England and east coast ports into Wales could offer opportunities for Welsh ports to provide short sea shipping or container feedering. This would involve moving containers from the main hub ports to Welsh ports on smaller container ships, roll-on roll-off vessels or ferries.

47. Witnesses warned that there was insufficient throughput and volume of import and export container traffic in Wales to support investment in large container facilities at a Welsh port and that proposals to develop container facilities at Bristol and Liverpool will probably serve the needs of businesses in both North and South Wales. Evidence from the Port of Mostyn acknowledged that transit to these ports would mean “additional inland transport costs for Welsh businesses, [but] to some extent these costs would be offset against the higher charges an under-utilised global shipping sized Welsh container terminal would need to charge to maintain viability”.70

48. However, other witnesses suggested that these developments might provide container feeding opportunities for Wales’s ports. Whilst a large scale container development in Wales would not be viable, witnesses told us that Wales should be developing short sea shipping or feeder services to/from the main container ports in the UK and North West Europe. 71 Mr Callum Couper, chair of the Wales Freight Group also told us that short sea shipping also costs less by getting the ship as close as possible to the origin or destination of the cargo. He argued that there is scope to develop the concept of short sea shipping, with

68 Ev 72 69 Ev 83 70 Ev 117

71 Q13

Ports in Wales 21

Welsh ports acting as a location to feed in from the deep sea hub ports. This could also provide new opportunities for investment in logistics and distribution.72

49. Based on the evidence we have received, developing feeder services appears the best way for Wales to take advantage of the growth in the use of containers and would also provide opportunities for the ports and environmental benefits. We were told that developing this business is an area under consideration in Wales and “opportunities to encourage feeder shipping services have been discussed at the Wales Freight Group”.73 Furthermore, Mr Ieuan Wyn Jones AM, Welsh Assembly Government Minister for the Economy and Transport, told us that he is working with the ports in South Wales to examine their potential to attract new business in this area.74

50. The Welsh Assembly Government stated that it is “aware of a number of changes in supply chain and distribution practices that could provide opportunities for Welsh ports. This includes the increasing use of feeder ships to trans-ship containers from the major hub ports, as well as the scope to transfer long-haul freight movements from the Iberian peninsula to road and sea”75. According to the paper, the Assembly Government is “keen to encourage the development of coastal feeder services for container traffic”.76

51. Whilst a large scale container development in Wales would not be viable, we would support the industry’s view that Wales should be developing short sea shipping or feeder services to and from the main container ports in the UK and North West Europe. This would provide business opportunities for the ports and would reduce the environmental impact of the freight sector. We would encourage the Welsh Assembly Government to assess the scope to develop business in this area with the aim of increasing the volume of goods being transported to Wales by sea.

52. Witnesses have recognised the important role the ports can play in supporting a more environmentally sustainable transport policy in the future. Transporting goods by sea is often more environmentally benign than doing so by road and should be encouraged.

Energy Sector

53. Ports have played a central role in the energy sector in Wales for a number of years. Milford Haven, for example, has grown to become one of the most important locations for the energy sector in the UK, as highlighted by Milford Haven Port Authority:

[Milford Haven Port] supports two [oil] refineries that produce over 20% of the UK’s production of petrol and diesel ... more recently, the well-heralded advent of Liquefied Natural Gas shipping into the port hast taken place with the recent opening of the South Hook terminal and the expected opening of the Dragon LNG

72 Q13 73 Ev 94 74 Q311 75 Ev 165 76 ibid

22 Ports in Wales

Terminal this summer. Between them, these two terminals have the capacity to provide over 25% of the UK’s gas requirements for decades to come.77

54. The growth of the renewable energy sector could provide a significant new opportunity for ports both in terms of energy generation on port land, and the supply and distribution of energy sources and component parts for the relevant technologies. Mr Matthew Kennerley of Associated British Ports South Wales highlighted these opportunities:

Energy is a big part of what we already do in terms of supplying energy producers, generators with power stations, coal or other fuel sources. We see that the ports are well positioned from a land holding point of view, from the vessel access point of view as more generators rely on imported fuel supplies, whether that be coal, oil or biomass. Ports are ... well connected into the local energy supply grids as well as the National Grid and we see that right across our South Wales ports, so there are opportunities in Wales to develop additional energy resources ... provide locations for generators to build new power stations, whether they are biomass, multifuel, peaking plants whatever ... what we need to see from government is a consistent approach to planning.78

55. Several Welsh ports have already been identified by the UK Government as being in a strong position to service the growing renewable energy industry, and as locations for energy installations. Many ports are keen to play their part in this growth. The British Ports Authority referred to the UK Ports Prospectus which identifies four Welsh ports (Mostyn, Milford Haven, Swansea and Port Talbot) as sites that are well-placed to service the offshore renewables sector. The submission also states that this would be “substantially new business and apart from the movement of equipment, will require storage and offshore servicing facilities”.79

56. The Department for Energy and Climate Change published its Low Carbon Transition Plan in July 2009.80 This document reiterated the Government’s intention of increasing the generation of energy from renewable sources, including marine and offshore renewables. In oral evidence, Mr Ieuan Wyn Jones AM, Welsh Assembly Government Minister for the Economy and Transport, expressed his eagerness to explore this area further and stated that he would be keen to work with relevant Welsh Assembly Government Ministers “in order to facilitate, if you like, the development of the Welsh ports for renewable energy”.81

57. The Welsh Assembly Government is well placed to assist the Welsh ports to take advantage of the growth of the renewable energy sector, both in terms of servicing the industry and as a location for energy installations. Welsh Assembly Government Ministers should work together to identify where these opportunities exist and communicate them to the UK Government. The Wales Office has a role in making sure this direct liaison happens.

77 Ev 110 78 Q113 79 Ev 75 80 Department for Energy and Climate Change, Low Carbon Transition Plan (2009) 81 Q324

Ports in Wales 23

The role of government

58. The majority of the Wales’s larger ports are privately owned, with the exception of Milford Haven, which is a trust port. In general, ports in England and Wales do not receive any public subsidy for their development or operations. Witnesses told us that in other parts of the EU where ports are publicly owned, public authorities invest in the development of port facilities and infrastructure.82 Not only are continental ports more likely to attract public funding for investment in their development, witnesses told us that the infrastructure connections to the ports are publicly funded. They argued that the fact that both these elements are publicly funded means UK ports are “severely disadvantaged”.83 Nevertheless, Mr Christopher Snelling of the Freight Transport Association agreed with the Department for Transport’s approach in the context of freight: “private developers should be responsible for the cost of developing the ports. They are private facilities which can make money; and they should be responsible for doing that”.84

59. The Department for Transport provided its rationale for this policy:85

Subsidy to port operations should generally be avoided, as it tends to distort competition and is unnecessary for the provision of sufficient capacity. Only in extreme circumstances of demonstrable market failure, environmental impact or significant net regeneration effects, should it be considered.86

Mr Paul Clark MP, Parliamentary Under Secretary of State for Transport, confirmed that: “there is a strategy for ports development, but it is one where we believe that the development of ports very much should be a free market-led development”;87and that a detailed policy indicating how and where ports should develop in each region would add little to the regional approach taken in transport and spatial planning.88 However, in response to questioning on the need for decision-making on ports development, the Minister told us that he believed this was best dealt with locally so that decisions could be based on local demands.89

60. The British Ports Association explained that the ports want to continue to be responsible for their own development so that they can identify market opportunities, provide the right facilities and compete with other ports within Wales and the UK.90 Evidence we have received has argued that this approach allows the port operators to use their own assets creatively,91 has led to the greatest efficiency in freight movements,92 and is

82 Q67 83 ibid 84 ibid 85 Ev 156 86 Ev 154 87 Q277 88 Ev 154 89 Q291 90 Ev 74 91 Q14 92 Q66

24 Ports in Wales

appropriate because trade patterns are unlikely to fit in with the development plans of government.93 Witnesses agreed that government should not intervene in the day to day running of the ports, but should provide the right policy framework within which they can operate efficiently and respond to changes in the market.94 The evidence we have received throughout this inquiry has demonstrated that decisions made by government, in areas such as internal investment in facilities at ports or land-side links, can have an impact on the competitiveness of ports and their ability to attract more business.

A distinctive Welsh approach

61. Mr Ieuan Wyn Jones AM, Welsh Assembly Government for Minister for the Economy and Transport, described how the Welsh Assembly Government intends to develop the potential of Welsh ports, based on the strengths of each individual port, indicating a more proactive approach in Wales:95

Our position, as I think has been made clear not just in the Wales Freight Strategy but also in other documents that we have presented, is that we want to develop the potential of Welsh ports. The potential, of course, is different relating to where each port is located geographically, its historical patterns and how you then develop that into the future.

The Minister also told us that the Welsh Assembly Government would consider providing funds for investment in ports, but would not “be putting in investment purely in terms of speculation; we would want to do that based on a business case”.96 Issues of state aid, market distortion and displacement would be key considerations.97 There is an apparent inconsistency between this approach in Wales and the Department for Transport’s policy of non-intervention.

62. Dr Anthony Beresford of Cardiff Business School suggested that there may be a case for a more proactive approach to ports policy, as advocated by the Transport Select Committee (see Section 1). Such a policy could, for example, identify which ports would benefit from improved facilities, or from improved transport links.98 Dr Beresford proposed that:

Government policy towards Welsh ports cannot be, nor should it be, dramatically different from that applied to other British ports … However, there are certain important differences between Welsh ports and English ports, for example in the profile of port ownership (private/ trust/ municipal), the landbridge function [i.e. to Ireland] performed by several Welsh ports, the extreme tidal regime constraining ship size and access in the Severn Estuary, the strategic importance of just two key corridors in Wales, and the relative disadvantage Wales has, by virtue of its West-

93 Ev 120 94 Q67 95 Q308 96 ibid 97 Q309 98 Q14

Ports in Wales 25

facing aspect, in relation to core EU trade. Ports policy for Wales must take account of these differences”.99

63. Port operators require a certain level of return from their investment in port facilities and in a number of cases the return is unlikely to be sufficient for them to justify the investment. In many instances, while the benefits to the ports themselves may be small, developing facilities at ports can stimulate economic growth in the port’s hinterland through the creation of jobs, and can often lead to improvements in the transport infrastructure. In these circumstances, it may be appropriate for the public sector to intervene and provide the funds to facilitate developments. The cruise facility feasibility work in Holyhead is one area where the Welsh Assembly Government may be willing to invest because the market will not provide upfront capital investment. The potential beneficiaries of this type of development are dispersed: while the ports themselves would only receive a nominal fee from the cruise lines for the use of their facilities, the local area would benefit significantly from visitor spend. It may therefore be a sound policy to invest taxpayers’ money in such developments in the expectation that increased economic activity will provide a good return on such investment.

64. The Department for Transport and the Welsh Assembly Government have different views on the investment of public funds in ports. The former supports an approach that lets the market lead investment, whilst the latter supports greater government engagement. The Department for Transport’s approach has worked for the larger English ports because the growth of the sector in England and Wales is skewed by their success, and boosted by their high population densities and high levels of economic activity. Most Welsh ports, however, are operating below capacity and face specific challenges which would justify a more strategic approach to their development.

65. Increasing the volume of freight being transported by sea would reduce the environmental impact of the freight sector. However, Welsh ports face specific challenges (such as poor connectivity with the transport network – see section 3), which shackle their ability to compete. For this reason, we welcome the Welsh Assembly Government’s willingness to consider investing in Welsh ports. We believe there is merit in identifying where there is spare capacity at Welsh ports and opportunities for the future.

66. The Department for Transport acknowledges that decisions on port development are best dealt with regionally or locally but maintains that investment in ports should be market-led. The different approaches of the Department for Transport and the Welsh Assembly Government could result in the lack of agreed and coherent strategic objectives for Welsh ports, in the knowledge of which sound commercial investment decisions could be confidently made. Government at all levels must use its powers in a complementary and focused way to achieve agreed outcomes that will lead to an expansion in the port sector. In this context, we would expect the Department for Transport to follow through its stated commitment to local decision-making in the creation of locally relevant policy. It must be prepared to co-operate with the Welsh Assembly Government to consider public investment where local factors inhibit the

99 Ev 73

26 Ports in Wales

exploitation of market forces to provide for investment in Welsh ports. We recommend that the Department for Transport and the Welsh Assembly Government develop a distinctive ports policy for Wales to identify where investment should be targeted to enable the sector to thrive.

67. Given the administrative division of reserved and devolved matters relating to ports, we believe that the Wales Office should play a much greater and more proactive role in facilitating and encouraging co-operation between the Welsh Assembly Government and relevant central government departments. The Wales Office must ensure that it is doing everything possible to represent Welsh interests within Whitehall. The Wales Office does not have the technical expertise to deal with many of the specific issues involved, so, a robust and direct working relationship must be established between the Department for Transport and the Welsh Assembly Government. It is essential that the Department of Transport should have a clear understanding of Welsh needs and priorities in order to ensure that the right support is on offer. The personal role of the Secretary of State for Wales in particular—as well as the Wales Office as an institution—is crucial. He must make sure that in this area of policy such relationships are established, maintained and work well. This is, of course, the key role of the Secretary of State and his team across all areas of Government policy and interaction.

Grant Funding

Domestic sources

68. Ports are eligible for the Freight Facilities Grant. This is a Department for Transport grant, administered in Wales by the Welsh Assembly Government. Its purpose is to encourage the modal shift of freight from roads. The inclusion of ports within the scheme is a recent development. The grant was originally developed to deal with the additional cost of moving freight from roads to rail, but now includes water, as this is increasingly being encouraged as a more environmentally benign means of transporting freight. The Waterborne Freight Grant can fund operating costs and includes the purchase of intermodal containers. The grant is also available for freight movements by coastal and short sea shipping. Calculations for the amounts awarded are based on environmental benefit of shifting the freight from roads. The Department for Transport and the Welsh Assembly Government should raise awareness of the eligibility of ports for the Freight Facilities Grant.

EU funding

69. In evidence, DG TREN of the European Commission referred to a number of Commission-run programmes which encourage modal shift from road to other means of transport or which can fund facilities and developments at or linked to ports, such as the Marco Polo and Ten-T programmes.100 We also heard about the Motorways of the Sea initiative, which funds knowledge-transfer but not development or investment in facilities.

100 Ev 83-84

Ports in Wales 27

70. Witnesses criticised these programmes, suggesting that it was difficult for ports in Wales to access these funds. The requirement for project sizes required by the Commission under the Marco Polo II and Ten-T programmes are too large for the Welsh ports:

They do not lend themselves easily to the sort of support that Welsh ports would need to plug in to some of the trade flows ... which could have much broader benefits for Wales and the UK and environmentally.101

EU funding programmes

Representatives we met during our visit to the Baltic had differing views of the EU’s initiatives for ports. The Finnish Ports Association, for example, felt that the Commission’s programmes were difficult to access and did not think that the Motorways of the Sea initiative, in particular, had been successful. However, the Swedish Maritime Administration told us that Swedish ports had benefitted greatly from European programmes that funded transport and ports developments. They believed that other EU Member States should make a greater effort to access these funds.

71. The Department for Transport and the Welsh Assembly Government should do more to assist ports in Wales to access relevant EU funds where these are available. Witnesses told us, however, that in many instances the rules set by the European Commission mean that these funds are not available for Welsh ports. In these cases, the UK Government should lobby the EU for a fairer system.

101 Q14

28 Ports in Wales

3 Infrastructure

Policy framework

72. Wales’s ports operate within UK and international markets; the goods that travel through the ports do not just originate from or are destined for Welsh markets. However, the evidence we have received has emphasised the fact that the Welsh ports do face particular challenges as a result of factors such as the geography of Wales, the tidal regime in south Wales and the constraints of the main transport routes to some ports; government can help address these problems by providing a policy framework that recognises the needs of ports, the freight sector and passengers.102 The Welsh Assembly Government told us that it sees the development of an appropriate policy framework as its key role in helping ports to reach their potential:

The Assembly Government... has made it a priority to ensure that the linkage between ports and the economy is reflected in its wider economic development and transport policies.103

73. The freight sector told us that the public sector’s role was to provide a planning and policy framework which enables the efficient development of ports; and to provide greater support for the development of inland infrastructure connections, rail and road links.104

74. All levels of government must facilitate the development of Welsh ports by providing the right policy framework within which they can operate efficiently. Our evidence has demonstrated that at present these conditions do not exist. Many Welsh ports are disadvantaged because of inadequate road or rail links, or because of delays within the planning process. For Wales’s ports to develop and increase their contribution to the economy, the Department for Transport and the Welsh Assembly Government should put in place the right policy framework, which includes an integrated transport policy, land use planning and spatial planning across regions and borders. The Wales Office should proactively encourage this process.

75. The evidence we received from both the Welsh Assembly Government and Department for Transport Ministers referred to joint working and good relationships at official level to ensure “joined-up thinking for the development of Wales as a whole”.105 For example, we heard about a recent visit by Department for Transport officials to learn more about efforts to develop better cruise liner facilities at Holyhead port.106 However, Mr Ieuan Wyn Jones AM told us that there had been no ministerial discussion on ports issues to date but that “if there are important issues that need to be resolved at Ministerial level then obviously I would be very happy to arrange Ministerial meetings”.107

102 Ev 73 103 Ev 164 104 Q67 105 Q305 106 Q299 107 Q306

Ports in Wales 29

76. Despite these reassurances, we received mixed evidence from witnesses. Some were concerned that on some policy issues crucial to the competitiveness of ports, such as cross- border transport, there was very little evidence of co-operation.108 Other witnesses told us that relationships were still evolving,109 whilst some believed that the lack of co-operation was more a perception than a reality.110

77. We found no evidence of tension between the Department for Transport and the Welsh Assembly Government at present. However, we are concerned that a lack of dialogue at ministerial level could result in different levels of government moving in different directions on ports policy. Given the administrative division of reserved and devolved matters relating to ports, close co-operation will be needed in the future to ensure that policy remains joined up, and that all levels of government share ambitions and coherent objectives for the ports in Wales. The Wales Office should be central to this process.

Impact of policy decisions on the freight sector

78. Goods are transported to their onward destination from ports in Wales or other parts of the UK by road or rail, or overseas by ship. Good transport links and sustainable freight networks across all modes of transport are required for the efficient movement of freight. The quality of the routes to and from Welsh ports varies across Wales giving some of them a competitive advantage and severely disadvantaging others. As we were told by Mr David Whitehead from the British Ports Association: “ports, quite frankly, are only as good as their infrastructure connections”.111 Some parts of Wales have seen improvements to the road infrastructure, and the ports of Cardiff, Newport, Swansea, Port Talbot and Holyhead are well connected to the main trunk roads. This means that some areas have swift links to strategic routes within the wider UK transport infrastructure.112

79. For freight forwarders and logistics companies, good connectivity is a crucial factor in deciding which ports to use, and roads remain the main method for carrying freight. The reliance on roads means that the quality of the links to key routes must be adequate for the volumes of freight they handle. Mr Christopher Snelling from the Freight Transport Association told us that:

For a freight forwarder ... to make a decision ... about which port to use, the main factors will be its connectivity towards the next destination. If we assume that something is arriving at a Welsh port to go to a further destination somewhere inland within the UK, it will be about the relative connection times of the ports on offer; a further factor would be the cost of using that port; ports have different charges depending on how they are operated and how they are set-up; and a third factor would be the efficiency of that port, which could mean not only the speed that

108 Q64 109 Q16 110 Q74 111 Q101 112 ibid

30 Ports in Wales

you get through, but also its reliability ... I think the most important one of those is the linkage to its onward destination.113

80. Dr Anthony Beresford from Cardiff Business School explained that the majority of Welsh ports’ activities are tied up with freight, and called for greater understanding of logistics chains to ensure the right type of infrastructure is built to move goods efficiently.114

81. The evidence we have received indicates that the Welsh Assembly Government’s understanding of freight operations is improving. Witnesses told us that the policies contained in the Wales Freight Strategy, published in 2008, are based on an understanding of the requirements of the freight and transport sectors, as provided by the Wales Freight Group.115 The Wales Freight Group is comprised of representatives from the transport and freight sectors, academics with expertise in logistics and transport, and civil servants from the Welsh Assembly Government, and acts as an advisory group on the freight strategy. A Welsh Ports sub-group has been created in recent months, which will also inform this process. Witnesses believed that the existence of this group has improved the Welsh Assembly Government’s understanding of the needs of the freight sector and ports and will influence policy development in the future.116 Mr Ieuan Wyn Jones AM, Welsh Assembly Government Minister for the Economy and Transport, believed the approach taken in developing the Wales Freight Strategy was a step in the right direction because it was created with substantial input from sectoral interests and frameworks are in place for this to continue.117

82. Mr Robert Davies from the Department for Transport told us that the larger ports input into national policy through the ports associations, the UK Major Ports Group and the British Ports Association, stating that these representative groups meet Department for Transport officials regularly. Referring to the Welsh Ports sub-group, he also stated: “it is good to know that the Welsh ports have now formed their own forum, which will make an input through that route as well”.118 Mr Ieuan Wyn Jones AM, the Welsh Assembly Government Minister for the Economy and Transport told us that he envisaged the Ports sub-group would work with the Welsh Assembly Government to put forward cases for ports developments, but that he did not see this group working directly with the Department for Transport.119

83. Witnesses told us that whilst relationships between the ports and government are generally effective, there was little engagement on some policy areas. Despite the various representative groups and fora in existence, concerns were raised that ports are not consulted on important policy decisions that can significantly affect their operations. The British Ports Association, for example, told us that the sector wanted “to play a bigger

113 Q78 114 Q23 115 Welsh Assembly Government, Wales Freight Strategy (2008) 116 Q307 117 ibid 118 Q280 119 Q307

Ports in Wales 31

collective role in transport spending decisions, with ports at the table and fully consulted”.120 The Freight Transport Association agreed that there was a need for greater co-operation between the ports and government: “policy makers must be able to enter into dialogue with operators to ensure that future decisions regarding ports… are based on the needs of industry”.121

84. Government needs a thorough understanding of the needs and challenges facing the freight and ports sectors to be able to develop appropriate policies that can facilitate their growth. The Wales Freight Strategy is an example of a co-ordinated and inter- modal view of the freight sector which is supported by the Wales Freight Group and more recently the Ports sub-group, and is a model which could be used more widely by government. The Welsh Assembly Government will need to continue to work closely with the freight sector to understand logistics chains, the role of the Welsh ports in these and how government can facilitate their efficient operation by providing the right policy framework. Stakeholders such as the Welsh Freight and Ports Groups are being used to ensure that relevant policies take account of the needs of this sector. This data should inform the Welsh Assembly Government’s discussions with the Department for Transport on issues affecting Welsh ports. The existence of these stakeholder groups should therefore result in the ports having a more effective means of proactively engaging with both the Department for Transport and the Welsh Assembly Government.

85. We note that the Welsh Assembly Government Minister for the Economy and Transport does not see a role for the Wales Ports Group in liaising with the Department for Transport. Nevertheless, despite the reassurances from the Department for Transport that they regularly liaise with the ports, we are concerned that there is little consultation with the sector on relevant policy areas at a UK or England and Wales level. We recommend that the Department for Transport should use the Wales Ports Group as a means of consulting with the ports industry in Wales to gain a better understanding of their collective concerns regarding relevant government spending decisions. We also recommend that Department for Transport officials should participate in the Wales Freight Group, if the group believes this would enhance the Department’s understanding of the challenges facing the Welsh ports and wider freight sector.

Land transport

86. Welsh ports service a hinterland which includes Wales, the M4 corridor, the Midlands, and the north and south west of England. Welsh ports are therefore competing with other ports in the UK and need to be well-connected to the overland links that feed in to these hinterlands. The Welsh Assembly Government’s Wales Freight Strategy identified the poor road and rail links to some Welsh ports as a weakness, although the good links to other ports along with rail development capacity were considered a strength.122

120 Ev 75 121 Ev 94 122 Welsh Assembly Government, Wales Freight Strategy (2008),

32 Ports in Wales

Cross border co-operation

87. In our recent inquiry into the cross-border provision of transport services we highlighted our concerns regarding the prioritisation given by the English regions to routes of strategic importance to those travelling across the English-Welsh border. A lack of strategic planning for investment in key routes by the English regions can have a significant impact on routes into/out of Wales.

88. According to Mr Paul Clark MP, Parliamentary Under Secretary of State for Transport, the Department for Transport and the Welsh Assembly Government both agree on the importance of transport links for the competitiveness of ports. He told us that one of the fundamental requirements in developing ports is ensuring that links inland, whether road or rail, are effective.123

89. Despite the Minister’s recognition of the importance of these links, witnesses criticised the quality of routes to many of Wales’s ports, and were concerned that there was insufficient cross-border co-operation on transport issues. Mr Stephen Kelly of the Freight Transport Association believed that at present there was very little evidence of co- operation:

There does need to be more communication, especially on transport issues, because as far as freight is concerned it does not know borders; a shipment coming into Fishguard does not necessarily stop at Newport, it will go beyond into England and beyond into Europe.124

90. Witnesses told us that the fact that ports policy is reserved and transport is devolved means that “continuing close co-operation and co-ordination between the Department for Transport and the Welsh Assembly Government is essential to ensure that the latter’s policies regarding road and rail links between Welsh ports and their hinterlands and markets, including those in England, are complementary to UK port policy”.125 Witnesses also believed that there is sufficient spare capacity at Welsh ports to handle increased levels of freight in the future but this could be severely affected by inadequate surface links in other parts of Wales, and that these links need to form a central part of transport planning locally and regionally. This is recognised by the South West Wales Regional Transport Consortium (SWWITCH), which told us of the need for “improvements to road and rail infrastructure serving the ports” which are essential for maintaining “existing and [developing] new business to sustain and encourage local businesses and suppliers”. 126

91. The Department for Transport and the Welsh Assembly Government must work together to address cross-border rail and road issues affecting ports. Decisions on investment in the wider transport infrastructure have affected the efficient movement of goods and people in and out of the Welsh ports and the competitiveness of the Welsh ports. A lack of co-ordination has resulted in inadequate landside access to some Welsh ports in the past. Greater cross-border co-operation on this issue is essential and should

123 Q278 124 Q64 125 Ev 120 126 Ev 131

Ports in Wales 33

form part of an integrated transport policy that covers all modes of transport. The Wales Office should facilitate and encourage this process.

92. A further concern raised by witnesses was the process of identifying Strategic National Corridors in England, a process which took account of the major influence ports have on traffic flows, but not beyond the English border. The Port of Holyhead (Stena Line) commended this work to an extent because it highlighted the value of good and reliable links to UK ports. However, Stena Line also criticised the fact that the Strategic National Corridors tail off at the Welsh border and are not integrated into the Welsh Trunk Road Forward Programme, pointing to the fact that this lack of integration means that no account is taken of the impact of Welsh ports on traffic flows across the England/Wales border.127

93. Both levels of government should ensure improvements and construction work on the Strategic National Corridors and the Welsh Trunk Roads Forward Programme are closely co-ordinated. We urge the Welsh Assembly Government and the Department for Transport to keep the whole supply chain in mind when considering transport infrastructure improvements and to consult fully with each other before commissioning such improvements.

Roads

94. Wales has two main routes along the northern and southern coasts, the A55 and the M4/A48/A40. Each of these leads to important Welsh ports which handle roll-on roll-off traffic from Ireland. It is inevitable that roads will become congested and that those transporting goods by road will experience occasional problems along the route. Bottlenecks occur across the road network and the resulting time-delays add to the overall cost of transporting goods. Vehicles travelling along Welsh roads are likely to encounter traffic problems, and in some cases this can happen very close to the port itself which makes using the port a less attractive proposition.

Pembrokeshire’s ports

95. Witnesses told us that beyond St Clears, the ports in Pembrokeshire (Fishguard, Milford Haven and Pembroke Dock) suffer from poor road links. These ports are served by single carriageway roads, which Mr Michael Farmer of the Road Haulage Association told us cause problems for these ports and makes them less attractive to road haulage companies:

... the A40 is still a single carriageway road heading for a port which is a ro-ro port which develops a lot of lorry traffic. I think that is a distinct disadvantage. Obviously, Wales being on the periphery, the ports being on the periphery of Wales, you need those road links; and that for us is the limiting factor for a number of ports.128

127 Ev 141 128 Q 83

34 Ports in Wales

96. Responsibility for improvements to these routes lies with the Welsh Assembly Government which, Mr Ted Sangster, Chief Executive of the Milford Haven Port Authority, claimed, had failed to “fulfil the expectations and the needs of the Pembrokeshire economy and ports” by not dualling the A40 beyond St Clear’s. He considered this to be “a significant dampener on potential investment opportunities in west Wales and ... a detractor from the use of the ports and the traffic making use of those ports”.129 Pembrokeshire County Council agreed with this view, stating that “necessary infrastructure improvements” must be secured to enable future growth at Milford Haven.130 Their main concern was the lack of a dual carriageway A40 link to the M4.131

97. The Welsh Assembly Government’s consultation on a National Transport Plan acknowledges that “these routes are susceptible to unreliable journey times caused by slower moving and larger volumes of traffic and congestion, particularly during busy holiday periods”.132 Even so, the Welsh Assembly Government Minister for the Economy and Transport told us that there is not a strong enough business case for the dualling of the A40 at present: “What we have done is make sure that the improvements that we are currently undertaking could accommodate a dual carriage road if at some future date the case for dualling can be made”.133

98. The lack of a dual carriageway serving the important ports in Pembrokeshire causes traffic congestion and longer journey times for vehicles and passengers using these ports. This issue impacts on their attractiveness to freight businesses. We acknowledge that there needs to be a sufficient justification for expenditure to dual this route and that the Welsh Assembly Government’s current approach allows for dualling in the future, should this be justifiable financially. The Welsh Assembly Government should keep this issue under review so as to ensure that ports in Pembrokeshire are not disadvantaged by an inadequate road connecting them to the main motorway network.

Holyhead

99. The Port of Holyhead is an important employer on Anglesey, supporting approximately 900 jobs.134 Two ferry companies operate services from Holyhead with up to seven daily sailings departing from the port. Land access to Holyhead has improved substantially in recent years with the dualling of the A55 expressway across Anglesey. This has had a positive impact on journey times for those travelling to the port and means that goods can be transported from Holyhead into the main motorway network in England within 90 minutes.

100. Witnesses told us that some local problems remain, however, and these affect the efficiency of movements to and from the port. The Port of Holyhead (Stena Line) told us about the difficulties experienced near Holyhead port due to the fact that the A55

129 Q102 130 Ev 119 131 ibid 132 Welsh Assembly Government, National Transport Plan Consultation (2009) 133 Q317 134 Ev 105

Ports in Wales 35

expressway stops some distance from the port check-in facilities. They believe that this results in “excessive traffic build-up on the local road network as well as causing significant delays to freight and tourist traffic arriving at and leaving the port”.135 Other problems which affect traffic heading to the port include delays on the Britannia Bridge and regular works along the A55 expressway. 136 Ynys Môn County Council and Irish Ferries agreed with the need to address these issues, which lead to “stresses on the transport network”.137

101. The Welsh Assembly Government’s consultation on the National Transport Plan proposes improvements that will address the capacity issues on the A55 across the Menai Strait. We welcome these proposed improvements and urge the Welsh Assembly Government to ensure they take place as soon as possible.

New links from the ports

102. Guidance on funding for significant infrastructure issued by the Department for Transport requires developers, as the sole beneficiary, to pay for inland links from the ports to the main transport network. These can sometimes extend into the main trunk network. The Welsh Assembly Government has issued similar guidance, not exclusive to ports, which places planning conditions on developers to ensure that they make a contribution towards the necessary infrastructure improvements. The Wales Freight Strategy discusses the need to identify port locations where new facilities could be developed, but does not make any reference to the funding of such development.

103. In other EU countries many ports are publicly owned and as a result the equivalent links are paid for from public funds. The Freight Transport Association told us that this potential additional burden on port investors “places UK ports at a competitive disadvantage to Continental ports, which typically do not have to bear these infrastructure costs”.138

104. In general, witnesses agreed with the Department for Transport’s approach. The Rail Freight Group, for example believed the developer should pay for any immediate links. However, they questioned the logic behind the requirement for the developer to extend their contribution to the strategic trunk network. The Group considers that this type of cost could become a barrier to investment in ports themselves.139 Other witnesses felt that ports should not be expected to shoulder the whole cost of new links where other users will benefit from improvements to the infrastructure.140 The Road Haulage Association believed that improving the transport infrastructure would increase the viability and success of ports, which in turn would create jobs. They argued this would need funding from both government and the private sector, and were concerned that: “ports should not be treated in any way differently from other commercial entities. It is not feasible for either the port operators or private investors in the ports to be expected to provide funding for

135 Ev 141 136 ibid 137 Ev 107 138 Ev 93 139 Ev 121 140 Q6

36 Ports in Wales

the entire required infrastructure beyond their boundaries when all road users will benefit”.141

105. We also heard criticisms of the Department for Transport’s guidance, with witnesses telling us that it is unclear what proportion of any new development the Government is willing to pay. This lack of clarity makes it difficult for port developers to plan and put in place finance for future investment in the ports that would attract new business.

106. Where expanding a port’s operations requires investment in road and rail infrastructure, it is right that the developer should pay a proportion of the cost. However, our evidence suggests that existing guidance is unclear about the extent of public funds which may be available to assist development. Both governments should provide more clarity on the contribution they are willing to make to such developments and within a timeframe that enables ports to plan their future business activities and investments.

Rail

107. The level of rail connectivity to Welsh ports also varies.142 Witnesses told us that “the current rail network in Wales does not present a barrier to development of ports in Wales, but ... investment will be required to allow rail to play a full role in serving any increase in traffic through those ports”.143

108. A number of problems affecting the contribution the rail network in Wales makes to the movement of freight were identified. Mr Robin Smith from the Rail Freight Group believed that although many Welsh ports have rail links, the loading gauge that can be handled by the Welsh rail network is likely to cause problems.144 Mr Stephen Kelly of the Freight Transport Association explained that:

I think where Welsh ports suffer is that they are not rail-linked to a certain extent, or to any extent as a matter of fact, and that is due to the rail infrastructure itself in terms of the loading gauge requirements. For example, in terms of the bigger sized containers, rail in Wales is not equipped for that. That has been highlighted in the rail utilisation strategy for Wales.145

109. Mr Callum Couper, Chair of the Wales Freight Group also acknowledged this as a problem:

If, for example, ports were going to be feeding containers, for example, into the Midlands, they would need sufficient loading gauge by rail to get them into the Midlands, with sustainable transport. We have not really got that, from South Wales anyway into the Midlands corridor—we have not got the width through tunnels and

141 Ev 124 142 See Table 1 for further information. 143 Ev 122 144 Q83 145 Q68

Ports in Wales 37

platforms for high cube containers which make up half the world’s population of containers.146

110. The Welsh Assembly Government’s transport and freight strategies have been clear in their ambition to move more freight from roads to rail. However, Mr Ieuan Wyn Jones AM told us that this is particularly challenging because of the lack of facilities available to undertake this transfer at the ports. The port of Cardiff, for example, does not have an on- dock rail freight terminal for containers.147 Consequently, carrying freight by road is significantly more convenient and cheaper, at present, than transporting goods by rail.148

111. The Rail Freight Group told us that the review of the potential for electrification of the line from London to Cardiff and Swansea would provide a rail link with full loading gauge capability.149 The UK Government announced on 23 July 2009 that this line would be electrified by 2016.

112. Upgrades of the rail network would be required if rail were to contribute fully to the transport of goods to/from Welsh ports. We welcome the UK Government’s recent announcement on the electrification of the line from London to south Wales, which will provide more capacity for goods on the railway, therefore more opportunity to move goods by train. The Department for Transport should clarify whether there will be benefits for freight as a result of this development.

Planning

Strategic and land use planning

113. For Welsh ports to become more attractive to customers they need to operate within, and be well linked to, an efficient transport system. Long term planning and co-operation between the ports, local authorities, regional bodies and government must happen to make sure developments take place at the right time. The Welsh Assembly Government told us that it recognises the importance of ports and “has made it a priority to ensure that the linkage between ports and the economy is reflected in its wider economic development and transport policies”.150

114. However, witnesses were concerned that this level of priority was not reflected in a number of local authority economic development, transport and regeneration plans as well as local development plans. This was believed to reflect the lack of understanding at a local level of what ports could offer in terms of employment, or how businesses in the area should be linked more closely to the ports themselves. Mr Callum Couper, Chair of the Wales Freight Group, said there was no recognition at policy level within some local authorities and some regions of the economic potential of the ports and believed that attempts should be made to improve the way decision makers in the ports, their customers

146 Q22 147 Ev 73 148 Q318 149 Ev 121 150 Ev 164

38 Ports in Wales

and planning authorities co-operate. He told us this should involve identifying “whether there is road and rail capacity” and should be given a long lead time so that planning happens a long time in advance.151

115. Recognition of the importance of ports to their local economy varies across local authorities. The port at Holyhead, for example, is considered a key driver of employment on Ynys Môn and the local authority’s policies reflect this. Neath Port Talbot County Borough Council told us that the economic contribution of the port facilities in Swansea and Port Talbot is vital, and that “in current times with a general reduction in trade, all support must be given to ensure these facilities are still fit for purpose following the economic recovery”.152 However, witnesses were concerned that “in other urban areas it [ports policy] is still almost invisible and that needs to be ramped up. In terms of the understanding of what ports and shipping can do, environmentally and economically [...] we need to raise the game”.153

116. The majority of the evidence we received from local authorities did place a high value on the ports in their area. Pembrokeshire County Council’s submission, for example, refers to the Pembrokeshire Haven Spatial Plan, which aims to overcome the “area’s peripherality by improving strategic transport links and economic infrastructure … maximising the potential of the area’s maritime assets and proximity to Ireland”.154 Written evidence from the City and County of Swansea states that “the potential to develop economic activity using the natural resource and primary purpose of Swansea docks should be maximised”155 and that: “development proposals that enhance the viability of the port … will be permitted provided that such proposals are compatible with adjacent development areas, communities, environmental enhancement schemes…”.156 We heard from Neath Port Talbot County Borough Council that its local development plan will examine “the potential to increase the scale and range of trade both through coastal shipping within the UK and with other countries”.157

117. The level of importance afforded to the ports as economic drivers varies across local authority areas in Wales. This can have an impact on not only policies within the area, but also policies that cross local authority boundaries, such as transport. The Welsh Assembly Government has a central role to play in ensuring that local authorities recognise the potential of ports and that the planning system and transport infrastructure operate ways that benefit the ports, or will be able to benefit the ports in the future. The Department for Transport must play its part and the Wales Office must ensure that different levels of government are joined-up and that cross-border co- operation takes place. We reiterate the importance of considering the whole freight supply chain in policy and planning decisions, both locally and nationally.

151 Q7 152 Ev 166 153 Q26 154 Ev 118 155 Ev 140 156 Ev 146 157 Ev 167

Ports in Wales 39

Land use conflicts

118. During our inquiry we heard of local concerns regarding the disposal of port land and the development of surplus land for other uses leading to conflict with the port’s operations. Mr Matthew Kennerley from Associated British Ports South Wales told us about tensions around the SA1 housing and leisure development in Swansea, which is close to some of the port’s activities that are believed by the port owners to have commercial potential.158 Mr Bryan Graham from Swansea County Council acknowledged that there have been issues surrounding activities at the port itself, for example the handling of aggregates that might be linked with environmental problems. However, Mr Graham sought to assure us that such problems were effectively dealt with during the planning stages.159

119. Tensions can also arise when non-port related activities are carried out on port land. The Road Haulage Association told us that this has happened in the past as a result of the port operators letting land to businesses that are unrelated to the port activities. They also indicated that this land take-up precludes the expansion of port-related activities often inhibiting the port’s development in the future.160

120. Local authorities have, however, argued that the planning process is able to deal with tensions that arise from changing the uses of land traditionally linked to ports. Co- operation on these issues between the port owners and the local authority were deemed to be effective in enabling surplus land to be identified for development. Pembrokeshire County Council’s Unitary Development Plan “considers that diversification of port facilities for leisure related use is appropriate where there is clear evidence that this will not prejudice port operations”.161 The City and County of Swansea told us that: “redevelopment of port land considered surplus to requirements may be considered appropriate subject to the criteria and safeguards set out in the Unitary Development Plan, and provided the viability of the wider port is not compromised”.162

121. Land suitable for use as harbours or ports is a valuable resource, and in urban settings is non-renewable: once given over to other purposes it cannot be easily replaced. The port operators are best placed to understand the requirements of their business and to identify land which is surplus but they should do this in close consultation with the business and local community. Whilst disposing of land for non- port related functions, such as housing, might provide the ports with higher financial returns in the short term, the local authorities should work closely with the port operators to ensure that it does not compromise any future development at the ports that might lead to job creation in the local area. Where necessary, local authorities should use their planning powers to restrict use of land to port-related functions and secure it for the future.

158 Q124 159 Q141 160 Ev 124 161 Ev 168 162 Ev 147

40 Ports in Wales

Environment

122. Our inquiry did not focus in detail on the environmental impact of port developments or operations. However, we did receive evidence from the RSPB highlighting the fact many Welsh ports: “coincide spatially with areas that are designated under domestic or EU legislation for their wildlife importance”.163 The evidence also emphasised the potential damage that port related development or operations can have on these areas, through activities such as dredging and construction.164

123. The Department for Transport told us that one of its priorities for ports is for their development and operations to continue to be carefully managed to minimise the impact on their surrounding and wider environment.165 Evidence from the ports sector criticised the implementation of environmental legislation by the UK Government, which they believed to be more stringent than in other EU countries and a barrier to the development of port operations.166

124. The ports in Wales have worked within these regulations for a number of years to develop approaches to their operations that have minimised their negative environmental impact, particularly in environmentally sensitive areas. The RSPB has praised the ports sector in the UK, claiming they should strive to continue to be exemplars for the sector in the EU.167

Severn Tidal Power

125. The Department for Energy and Climate Change and the Welsh Assembly Government confirmed in early 2009 that five projects for electricity generation from tidal power are to be assessed for development in the Severn Estuary. Associated British Ports told us about the potential impact of any developments on their operations, particularly in the ports of Cardiff and Newport. A barrage from Cardiff to Weston, for example, (only one of the five options being considered) would put these ports at a disadvantage because it would obstruct any ship’s passage to the ports and affect the tidal regime in the estuary. However, any of the proposed projects would provide these ports with business opportunities, particularly during the construction stage and would also have implications for development elsewhere. In particular, the potential for Port Talbot to be developed would be enormous given that it would then be outside the Severn Barrage with excellent deep-water facilities and plenty of port-related land for development.168

126. Renewable energy developments in the Severn Estuary could significantly impact on the tidal regime in the estuary, which in turn could affect the operations of the ports in Cardiff and Newport. Provided that adequate locking facilities are built in, not all these implications would necessarily be negative. The UK and Welsh Assembly

163 Ev 125 164 Ev 126 165 Q277 166 Q105 167 Ev 125 168 Q109

Ports in Wales 41

Governments should give careful consideration to the potential impact of any development in this area on the South Wales ports, together with the Wales Freight Group.

42 Ports in Wales

4 Security and border controls

127. Ports serve a key role in transportation of freight and people and are vital for seaborne trade and international commerce. Incidents that threaten the security of ports can have an impact not only on those facilities but also on wider supply chains. The profile of maritime security has been raised in recent months, and greater consideration is being given to threats to the UK’s maritime assets from terrorist activities. We took evidence on the arrangements for security at Welsh ports, the main threats to Wales’s ports and the resources of the authorities involved in securing these points of entry into the UK for people and goods.

Policy and legislation

128. The UK’s updated National Security Strategy published in June 2009 noted that, in the context of terrorism threats, “considerable attention is now being paid to the maritime domain”.169 The strategy states that maritime security will, therefore, be an area for specific consideration within the national security framework. Whilst the focus of this strategy is much wider than just ports and their operations, reference is made to the volume of UK trade that transits by sea, and the role of maritime transport for energy supplies to the UK. The strategy also recognises that “given the ongoing importance of this domain to the UK, and the increasing interdependence of the threats and drivers, it is vital that we take a more comprehensive overview of maritime security”.170

129. A recent report from the Defence Select Committee, The Defence Contribution to UK National Security and Resilience,171 noted:

We have learned of the contributions being made by several organisations to national security in the maritime environment. We do not question their competence or intention, but the extent to which they are properly resourced and co- ordinated. Vessels have been acquired by different agencies at different times for different purposes. At the same time, we are concerned at the level of action being taken to address identified threats to aspects of critical national infrastructure, such as ports, and that what assets are available for the purposes of maritime security tend to be largely reactive forces.

The Committee is concerned that the human and physical resource capability gaps identified by the Defence Select Committee should be given the necessary attention to deal with existing threats, and considers that Wales is no different from other parts of the United Kingdom in this respect.

130. All ports in Wales must comply with the International Ship and Port Facility Security Code which was adopted by the International Maritime Organisation in December 2002 and came into force globally in July 2004. The code is monitored by TRANSEC, which is

169 Cabinet Office, National Security Strategy (2009) 170 Ibid. 171 Defence Committee, Sixth Report of Session 2008-09, The Defence Contribution to UK National Security and Resilience, HC 121

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an arm of the Department for Transport with responsibility for transport security. This code formed the basis of EC regulation 725/2004 and the 2004 International Labour Organisation code of practice on enhancing port security, which forms the basis of EC Directive 65/2005. This second Directive is currently being transposed into UK law.172 All ports will need to comply with this legislation.

131. The UK Border Agency was established in 2008, bringing together the functions previously undertaken by the Border and Immigration Agency, customs work at the border from HMRC, and the UK Visa Services from the Foreign and Commonwealth Office. The UK Border Agency’s Eborders Programme is being implemented across UK ports from 2009 with a view to being fully operational by 2014.173 The programme will introduce electronic border control to the UK. Passenger and crew information will be provided electronically by carriers (airlines, rail and shipping companies) before travel starts on all journeys to and from the United Kingdom. Merchant shipping companies will also be subject to these controls.

132. The Borders, Citizenship and Immigration Act received Royal Assent in July 2009. When the Bill was introduced into Parliament in early 2009, it contained proposals to abolish the Common Travel Area between the UK, the Crown dependencies (the Channel Islands and the Isle of Man) and the Republic of Ireland. It was proposed that fixed immigration controls for all passengers and vehicles would be used. The House of Lords removed this clause during the Bill’s Committee stages. The Bill received Royal Assent without the inclusion of the clause.

Threats

Risk Assessment

133. Wales’s ports are key parts of the transport infrastructure but they face a number of threats. The Association of Chief Police Officers Cymru explained that the main threats to Welsh ports are from ‘routine’ criminality, illegitimate industrial or environmental protest, serious and organised crime or terrorism”.174 From the UK Border Agency’s perspective, the threats are wide ranging and include “illegal entry into the UK ... people trafficking, drugs smuggling, drugs going one way, cash smuggling coming the other, cigarette smuggling and road fuel”.175 The authorities co-operate on a number of levels to mitigate the threat to port facilities from terrorist activities.176

134. We were told that different methodologies are used to assess risks and threats by the authorities, based on each organisation’s perception of security threats and potential consequences. For example, the approach undertaken by TRANSEC may vary from that of the Department for Energy and Climate Change (which would be responsible for assessing the risks to the energy infrastructure in Milford Haven). This may vary again from the

172 Ev 95 173 UK Borders Agency, available at: http://www.ukba.homeoffice.gov.uk/managingborders/technology/eborders 174 Not printed 175 Q222 176 ibid

44 Ports in Wales

methodologies used by the police or by the ports themselves according to the requirements of the ISPS code.

135. We heard in evidence that joint assessments of all of the risks between different authorities do not happen at present and that there may be scope for greater coherence between the different arrangements. This lack of coherence could lead to differing priorities over the allocation of resources for security. Witnesses reassured us that this area is kept under review, but we recommend greater harmonisation of risk assessment methodologies to ensure consistency. We further recommend that the proposed Joint Committee on the National Security Strategy examine this aspect of national security at an early opportunity.

Border Control

136. During discussions on the Common Travel Area arrangements, witnesses highlighted the potential threat to the UK’s security as a result of ‘high risk’ passengers being able to travel easily from the Republic of Ireland to the Welsh ports. This was one of the UK Government’s main reasons for wanting to introduce border controls within the Common Travel Area. In written evidence, the UK Border Agency referred to abuses of the Common Travel Area agreement. The Agency stated that it had “seen increased levels of abuse by air and by sea with a number of people attempting to use Ireland as a back door into the UK”.177

137. In his evidence, Professor Frank Gregory, Professor of European Security at Southampton University, questioned “the extent to which there is any evidence of particular patterns in the use of Welsh ports as entry points into mainland UK by persons whose names may appear on ‘terrorist watch lists’”.178 However, the UK Border Agency told us: “our own analysis of risk has identified high risk arrivals and regular action is taken to meet ferries in this category”.179

138. The UK Border Agency highlighted the importance of all relevant stakeholders playing their part in providing information on passengers and goods travelling through ports. Mr John Whyte of the UK Border Agency was concerned that existing checks on passengers through the main ferry ports are “helpful but not comprehensive enough”.180 He indicated that there are occasional problems, such as some ferry operators not supplying adequate manifest information, for example for the crews and cargo on their ships, and said that some of these checks “could be stronger”.181 We urge ports and carrier companies to work more closely with the UK Border Agency to ensure that correct and timely passenger and crew information is provided. This would help the authorities to develop an accurate picture of movements in and out of the UK from the Common Travel Area.

177 Ev 161 178 Ev 96 179 Ev 161 180 Q261 181 ibid

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Police and border control staffing at ports

139. While some ports in England have independent police forces, Welsh ports are policed by local forces who respond to incidents when called or have officers located at the port. In addition, the Home Office provides £6.2million of funding for Special Branch posts that are dedicated to counter terrorism activities. This is paid to individual forces and provides for 124 Special Branch posts at Welsh ports, airports, and along the Welsh coastline. Key performance indicators for these posts are focused on the counter-terrorism agenda. The funding for these posts is ring-fenced and does not affect the funding of local forces, but any withdrawal of these resources would affect the service provided by forces.182 Assistant Chief Constable Collette Paul explained that there is effective “central tasking and control but local delivery”.183

140. In its written evidence, the Association of Chief Police Officers Cymru highlighted the occasional tension that can occur between these roles when Special Branch officers are required to deal with offences not linked to the counter-terrorism agenda, such as: “the arrest of illegal immigrants … disorder within the ports or on board vessels … drug abuse and trafficking”.184 However, in oral evidence, witnesses did not cite any examples of difficulties in this area.

141. Stena Line’s written memorandum notes that the numbers of officers involved in border checks at Holyhead at present amount to approximately 120: 60 are Special Branch Police Officers from North Wales Police; 20 are UK Border Agency Officers; and 40 are employed by the port operator as part of the Ship and Port Facility (Security) regulations 2004/05.185 With regards to the current arrangements, the UK Border Agency told us that its staff’s “attendance at ports is risk based and this serves to enhance our control in respect of traffic from Ireland, particularly in relation to abuse of the Common Travel Area”.186

142. The UK Border Agency further explained its specific staffing provision at Welsh ports:

Staffing levels in Wales have been increased during the past year, allowing UK Border Force to set up a fixed base at Pembroke Dock to address the risk at that port as well as in the Haven and at Fishguard. This has been welcomed by the ports and the Police based there. The staffing position in Holyhead is supplemented by the attendance of mobile immigration teams and at all ports in Wales, additional mobile UK Border Force resources are sent when required. For example, regular visits are made by National dog teams to Welsh ports who work with local staff to look for cash and Class A drugs in particular.187

143. The profile of the potential threat to maritime infrastructure has been raised in recent months, as recognised by the UK Government’s updated National Security Strategy. Ensuring the Welsh ports are secure depends on number of different aspects. These

182 Not printed 183 Q233 184 Not printed 185 Ev 142 186 Ev 161 187 ibid

46 Ports in Wales

include: dedicated police and border agency staff; intelligence-sharing on the threat facing ports; co-operation from stakeholders such as the coast guard, the local community and the private sector; accurate information on passengers, crew and vessels entering the ports; adequate resources for the authorities to respond to incidents at the ports; and the co- operation of the ports operators and customers. Each of these elements must be robust to ensure that Welsh ports are secure. In light of conflicting evidence, the Welsh Assembly Government, Wales Office and the Home Office should ensure the engagement of SOCA (the Serious Organised Crime Agency), Special Branch and the Security Service (MI5) in identifying, categorising and tackling the threat, in liaison with other law enforcement and order protection agencies. Milford Haven

144. Milford Haven’s port is a vitally important facility in the supply of energy to the whole of the UK and has a concentration of important energy installations. Two Liquefied Natural Gas installations have been developed in recent months. These are located near two existing oil refineries. A gas-fired power station will also be developed near the site in the coming months. According to the Milford Haven Port Authority, the oil refineries produce over 20% of the UK’s petrol and diesel, and the LNG facilities will have the capacity to provide over 25% of the UK’s gas in the coming years.188

145. Pembrokeshire County Council told us they were concerned about Dyfed Powys Police’s capacity in south west Wales, particularly following the “increase in installations of national and international interest” with the recent development of the LNG terminals.189 This concern was amplified by Assistant Chief Constable Colette Paul of the Association of Chief Police Officers Cymru, who called for more resources for Dyfed Powys Police to ensure they could provide an adequate response to an incident at Milford Haven, should this be necessary:

Dyfed Powys is the largest force area in the country ... the force cannot meet the target times. There are graded criteria around threat and risk and you have to try and meet it within a ten-minute period. This is a force that is 170 miles from the west border to the east border and it can take up to three and a half hours to actually get that distance ... The Chief Constable has made it really clear that he does need some extra support and help in terms of protective security for this area. He has said that he needs a dedicated armed response to actually assist there, and that comes to about £700,000, but he has emphasised that he needs a vessel as well ... that is probably nearer to £1.5 million in terms of training and a vessel.... if you do that you still need all the CCTV, the ANPR, the back-up support around strategic coordinating centres.190

146. We emphasise that witnesses did not state that specific threats to Milford Haven had been identified. However, we did hear concerns about the risk of a threat and the specialist capability of the local police force, Dyfed Powys Police, to respond in the necessary time, as defined by the Home Office, to deal with any incidents at such a site.

188 Ev 110 189 Q151 190 Q256

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Milford Haven is a vital port and has expanded rapidly. Dyfed Powys Police must be adequately resourced to deal with the demands they now face in this area. We recommend that additional resources be made available to Dyfed Powys Police to enable it to undertake these activities. These resources must be proportional to its additional responsibilities and must reflect the importance of Milford Haven to the whole of the UK.

Co-operation

147. In evidence, the levels of co-operation between agencies dealing with security at ports was believed to be effective. Mr John Whyte of the UK Border Agency told us that the level of co-operation in Wales was greater than in many other parts of the UK:191 “in Wales we are actually seeing a lot of co-operation ... because of its size we are actually able to do a lot more in terms of working together than perhaps we can elsewhere”.192

148. There are several arrangements in place to facilitate co-operation between police forces within and outside of Wales on security issues affecting ports. We heard about the existence of two police portal groups, the Irish Sea portal group and a Bristol and Cardigan Bay portal group, in which the Welsh forces participate. These groups allow for co- ordination with forces outside of Wales and regular intelligence sharing. We also heard about co-operation with other authorities such as the Serious and Organised Crime Agency, the UK Border Agency, the Maritime and Coastguard Agency and the value placed on these relationships.193 Detective Chief Inspector Andy Jenks-Gilbert told us that these arrangements are a “massive leap forward in terms of the co-operation and collaboration between the agencies”.194

149. The Association of Chief Police Officers Cymru also told us about the ‘active enhancement of border policing’ which requires collaboration between the police service, the private and public sectors to improve the effectiveness of policing at the UK Border. According to the Association, exercises are undertaken to assess the response format and requirements in the face of a major event. To illustrate this, we were told about Operation Oystercatcher, a contingency planning exercise that brought the armed forces, police, local authorities and Welsh Assembly Government together.195

150. Witnesses were very keen to highlight the important role that the ports communities and stakeholders play in assisting with the gathering of information and intelligence needed to assess security risks. The role of Maritime and Coastguard Agency was in particular deemed to be significant in alerting the authorities to unusual activities along the coast.196

191 Q244 192 Q226 193 Q233 194 Q240 195 Not printed 196 Q245

48 Ports in Wales

151. The ports told us that they felt security and policing arrangements were adequate. Their compliance with legislation on port security means that they all adhere to certain standards. However, we also heard from the port operators that whilst they were satisfied with security arrangements at the ports, “more support and improved relationships [with the police] at a local level would be of benefit in dealing with specific issues as they arise”197.

152. There is considerable co-ordination between agencies within Wales, with relevant bodies across the border, and nationally, on issues of ports security. Co-operation between the police and authorities dealing with control of the borders is particularly efficient and avoids duplication and overlap.

153. However, we are concerned that the evidence we received suggested there were gaps in existing arrangements and that relationships could be improved. Minimising the threats to the ports and their hinterlands requires all the relevant players to co- operate effectively. The authorities and the private sector will need to work closely to facilitate this. The ports and ferry operators must play their part in ensuring that the authorities, such as the UK Border Agency, have adequate information on passengers travelling into the UK.

Common Travel Area

154. During our inquiry we received evidence from a number of witnesses raising concerns about the proposed changes to the Common Travel Area included in the Borders, Citizenship and Immigration Bill at the time. This Bill was being considered in Committee at the time of our inquiry and received Royal Assent in July 2009. Witnesses were concerned about the inclusion of a clause which would provide the power to introduce border checks at points of entry into the UK from the Common Travel Area.

155. The Common Travel Area allows for free movement of people between the UK and the Republic of Ireland and the Crown Dependencies (the Channel Islands and the Isle of Man). This means that no passport checks are undertaken on those passengers travelling between these locations. The clause would have removed this freedom.

156. In evidence, ferry and port operators raised a number of concerns regarding these proposals which included the impact of increased border controls on the efficient movement of vehicles and passengers, and the likely economic burden of implementing the controls to the port operators. We also heard evidence that it was unlikely there would be any controls between the Republic of Ireland and Northern Ireland and there would be no border controls for those travelling between Northern Ireland and Scotland. Witnesses felt this would displace the problems of illegal immigration from Ireland to other parts of the UK and could also displace business from the Welsh ports if vehicles were likely to encounter time delays at border control points, and if criminals decided to take their business elsewhere.

157. We note that on debating the Bill in the House of Commons, the Home Office Minister, Mr Phil Woollas MP, accepted the opposition to this clause and it was removed in the House of Lords.

197 Ev 70

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5 Conclusion

158. Ports are important transport infrastructure resources. They serve a key role in the transportation of freight and people and are vital for seaborne trade and international commerce. In addition, they serve as the nodal interface where maritime transport connects with other modes of transport and where trading, logistics and distribution activities can take place. There are a number of opportunities for Wales’s ports to make a greater contribution to the economy, but these opportunities will not be exploited without the right policy framework, and without support from government at all levels.

159. The cruise market in particular offers a significant opportunity for the economies near the Welsh ports. Developing this market, however, will require public investment in facilities and public sector support to ensure its continued promotion and marketing. Recent initiatives are welcome, but more ambition must be shown in order to exploit the market’s full potential. For this to happen, the Department for Transport needs to fully support targeted investment in Welsh ports, in spite of its historic reluctance to intervene in the sector. The identified investment should proceed now in order to attract cruise operators who have a 3–4 year forward planning period.

160. Most Welsh ports have spare capacity and are well placed to take advantage of changing supply-chain and distribution practices, such as the increased use of feeder ships to transfer goods from major hub ports. By developing short-sea shipping or feedering services, Welsh ports could offer alternatives to road transport, which is environmentally damaging and increasingly time dependent as traffic levels rise and roads become more congested. The Wales Freight and Ports Group has been working effectively to create a better understanding of logistics chains and the movement of goods and to share market intelligence. This needs to be extended through a co-ordinated ports policy for Wales shared between the Welsh Assembly Government, the Department for Transport and the industry. Department for Transport officials should participate in the Wales Freight Group, if the group believes this would enhance the Department’s understanding of the challenges facing the Welsh ports and wider freight sector.

161. Ports also have a central role to play in the energy sector. Milford Haven, for example, has grown to become one of the most important locations for the sector in the UK. The growth in renewables could provide new opportunities for ports, both as locations for energy generation installations and in terms of the supply and distribution of fuels and equipment.

162. Wales’s ports serve broad hinterlands and must be adequately connected by transport links and surface access so that freight and people can travel swiftly to and from the ports. A lack of strategic planning for investment in key routes by the English regions can have a significant impact on routes into/out of Wales. Ports should be given a greater profile in transport and planning decisions locally, regionally and across borders. The Department for Transport and the Welsh Assembly Government must work together to address cross- border rail and road issues affecting ports. Greater cross-border co-operation on this issue is essential and should form part of an integrated transport policy that covers all modes of transport.

50 Ports in Wales

163. Ports policy is the reserved responsibility of the Department for Transport, whilst many other relevant policy areas are devolved to the Welsh Assembly Government. Our inquiry has found that different approaches have led to a lack of coherent strategic objectives for ports in Wales from both levels of government. Government at all levels must use its powers in a complementary and focused way to achieve the agreed outcomes that will lead to an expansion in the port sector in future. In this context, we would expect the Department for Transport to follow through its stated commitment to local decision- making in the creation of locally relevant policy and we recommend that the Department for Transport and the Welsh Assembly Government develop a distinctive ports policy for Wales to identify where investment should be targeted to enable the sector to thrive.

164. Given the administrative division of reserved and devolved matters relating to ports, we believe that the Wales Office should play a much greater and more proactive role in facilitating co-operation between the Welsh Assembly Government and relevant central government departments. The Wales Office must ensure that it is doing everything possible to represent Welsh interests within Whitehall. The Wales Office does not have the technical expertise to deal with many of the specific issues involved, so, a robust and direct working relationship must be established between the Department for Transport and the Welsh Assembly Government. It is essential that the Department of Transport should have a clear understanding of Welsh needs and priorities in order to ensure that the right support is on offer.

165. The authorities involved in security at Welsh ports co-operate very closely, but there is scope for more co-operation with the private sector such as the port operators and ferry companies. So that the Welsh ports are not seen as an easy point of entry into the UK, each member of the port community must play their part in ensuring threats to port security are minimised, and that up to date information is available on the goods and people travelling through Wales’s ports. We are not convinced that the significant additional pressure that has been placed on the local police force by the expansion of Milford Haven in recent years has been reflected in resource allocations. We recommend that additional resources be made available to Dyfed Powys Police to enable it to undertake these activities. These resources must be proportional to its additional responsibilities and must reflect the importance of Milford Haven to the whole of the UK.

Ports in Wales 51

Conclusions and recommendations

The cruise market

1. The relevant authorities must work together in Wales to ensure that the passengers who currently visit Wales on cruise liners spend their money in the hinterlands of the particular port of call. If improved facilities are developed in Wales, it will be essential that this co-operation continues. (Paragraph 22)

Barriers

2. Cruise based tourism can bring significant benefits to local economies. A limited number of cruise liners already visit Welsh ports but their frequency is constrained by the lack of appropriate facilities for them to berth safely. This could be resolved at relatively little cost compared to the economic benefit that might accrue from putting Wales on the cruise map. There is a significant opportunity for Wales to capitalise on the growth of the cruise market and demand for new cruise destinations, but co- ordinated work and investment will be required to deal with existing constraints and enable Wales to benefit from the projected growth of the cruise market. (Paragraph 26)

Challenges

3. Cruise companies need a long lead time to plan their itineraries and advertise these to customers. Work to develop the jetty at Holyhead should start as soon as possible, and efforts will need to be made to quickly find ways of overcoming problems associated with state aid. (Paragraph 32)

4. The lack of quayside facilities for ships mean that, at the moment, other ports in the UK and Ireland are more attractive to cruise companies than those in Wales. Investment is needed to develop these facilities; the Department for Transport should assist the Welsh Assembly Government’s efforts to ensure that this happens as soon as possible. The Welsh Assembly Government should continue to work with the cruise companies through Cruise Wales to ensure that any facilities developed in Wales meet their requirements in the medium to long term. (Paragraph 33)

5. The Cruise Wales partnership works hard to raise the profile of the whole of Wales as a cruise destination, and to gain a better understanding of the needs of both the cruise lines and their customers. We welcome the recent announcement of £1.2 million in European Funding for the Celtic Wave which will enable the ports of Holyhead, Milford Haven and Swansea to work with their counterparts in Dublin, Waterford and Cork to market the region as a cruise destination. However, more ambition must be shown in order to exploit the full potential of the cruise market. Promoting Wales as a destination along with other Celtic/Irish Sea ports must be a priority so that the cruise lines can include Wales in their itineraries as soon as possible. The UK Government should support this work so that the UK as a whole can offer a more diverse range of itineraries to cruise companies. (Paragraph 34)

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6. Developing the cruise market in Wales will benefit the whole of the UK. By improving the facilities in Wales, more UK based cruise itineraries can be created but this will require public investment. We are concerned that the lack of clarity from the Department for Transport about the scope and availability of public funding for cruise facilities could affect ambitions to develop Wales as a cruise destination. The Department’s policy of non-intervention in port development should not apply in this context. The market will not invest in a capital scheme for developing cruise facilities because of the low rate of return to the port operators from cruise operations. We are concerned that the Department for Transport has not given sufficient consideration to the benefits to local and regional economies from cruise tourism. (Paragraph 36)

Logistics

7. Ports are a key link in the supply chains in the UK. Overseas manufacturers and freight forwarders will look at the total supply chain from the point of origin to the final destination. The UK and Welsh Assembly Governments need to be aware of the relationship between logistics and supply chains and the location of jobs. Furthermore, the Welsh Assembly Government should ensure that it understands what the market requires by undertaking demand forecasting to inform policy development and assist the Welsh ports to increase their business. (Paragraph 44)

8. We recommend that the Welsh Assembly Government undertakes a review of spare capacity at Welsh ports. This would help identify the transport and infrastructure improvements needed to facilitate more freight movements through Welsh ports. The freight sector needs a long lead-time to plan operations. We suggest that this activity should, therefore, start as soon as possible. (Paragraph 45)

Short-sea shipping

9. Whilst a large scale container development in Wales would not be viable, we would support the industry’s view that Wales should be developing short sea shipping or feeder services to and from the main container ports in the UK and North West Europe. This would provide business opportunities for the ports and would reduce the environmental impact of the freight sector. We would encourage the Welsh Assembly Government to assess the scope to develop business in this area with the aim of increasing the volume of goods being transported to Wales by sea. (Paragraph 51)

10. Witnesses have recognised the important role the ports can play in supporting a more environmentally sustainable transport policy in the future. Transporting goods by sea is often more environmentally benign than doing so by road and should be encouraged. (Paragraph 52)

Energy Sector

11. The Welsh Assembly Government is well placed to assist the Welsh ports to take advantage of the growth of the renewable energy sector, both in terms of servicing the industry and as a location for energy installations. Welsh Assembly Government

Ports in Wales 53

Ministers should work together to identify where these opportunities exist and communicate them to the UK Government. The Wales Office has a role in making sure this direct liaison happens. (Paragraph 57)

A distinctive Welsh approach

12. The Department for Transport and the Welsh Assembly Government have different views on the investment of public funds in ports. The former supports an approach that lets the market lead investment, whilst the latter supports greater government engagement. The Department for Transport’s approach has worked for the larger English ports because the growth of the sector in England and Wales is skewed by their success, and boosted by their high population densities and high levels of economic activity. Most Welsh ports, however, are operating below capacity and face specific challenges which would justify a more strategic approach to their development. (Paragraph 64)

13. Increasing the volume of freight being transported by sea would reduce the environmental impact of the freight sector. However, Welsh ports face specific challenges (such as poor connectivity with the transport network – see section 3), which shackle their ability to compete. For this reason, we welcome the Welsh Assembly Government’s willingness to consider investing in Welsh ports. We believe there is merit in identifying where there is spare capacity at Welsh ports and opportunities for the future. (Paragraph 65)

14. The Department for Transport acknowledges that decisions on port development are best dealt with regionally or locally but maintains that investment in ports should be market-led. The different approaches of the Department for Transport and the Welsh Assembly Government could result in the lack of agreed and coherent strategic objectives for Welsh ports, in the knowledge of which sound commercial investment decisions could be confidently made. Government at all levels must use its powers in a complementary and focused way to achieve agreed outcomes that will lead to an expansion in the port sector. In this context, we would expect the Department for Transport to follow through its stated commitment to local decision-making in the creation of locally relevant policy. It must be prepared to co- operate with the Welsh Assembly Government to consider public investment where local factors inhibit the exploitation of market forces to provide for investment in Welsh ports. We recommend that the Department for Transport and the Welsh Assembly Government develop a distinctive ports policy for Wales to identify where investment should be targeted to enable the sector to thrive. (Paragraph 66)

15. Given the administrative division of reserved and devolved matters relating to ports, we believe that the Wales Office should play a much greater and more proactive role in facilitating and encouraging co-operation between the Welsh Assembly Government and relevant central government departments. The Wales Office must ensure that it is doing everything possible to represent Welsh interests within Whitehall. The Wales Office does not have the technical expertise to deal with many of the specific issues involved, so, a robust and direct working relationship must be established between the Department for Transport and the Welsh Assembly Government. It is essential that the Department of Transport should have a clear

54 Ports in Wales

understanding of Welsh needs and priorities in order to ensure that the right support is on offer. The personal role of the Secretary of State for Wales in particular—as well as the Wales Office as an institution—is crucial. He must make sure that in this area of policy such relationships are established, maintained and work well. This is, of course, the key role of the Secretary of State and his team across all areas of Government policy and interaction. (Paragraph 67)

Grant Funding

16. The Department for Transport and the Welsh Assembly Government should raise awareness of the eligibility of ports for the Freight Facilities Grant. (Paragraph 68)

17. The Department for Transport and the Welsh Assembly Government should do more to assist ports in Wales to access relevant EU funds where these are available. Witnesses told us, however, that in many instances the rules set by the European Commission mean that these funds are not available for Welsh ports. In these cases, the UK Government should lobby the EU for a fairer system. (Paragraph 71)

Policy Framework

18. All levels of government must facilitate the development of Welsh ports by providing the right policy framework within which they can operate efficiently. Our evidence has demonstrated that at present these conditions do not exist. Many Welsh ports are disadvantaged because of inadequate road or rail links, or because of delays within the planning process. For Wales’s ports to develop and increase their contribution to the economy, the Department for Transport and the Welsh Assembly Government should put in place the right policy framework, which includes an integrated transport policy, land use planning and spatial planning across regions and borders. The Wales Office should proactively encourage this process. (Paragraph 74)

19. We found no evidence of tension between the Department for Transport and the Welsh Assembly Government at present. However, we are concerned that a lack of dialogue at ministerial level could result in different levels of government moving in different directions on ports policy. Given the administrative division of reserved and devolved matters relating to ports, close co-operation will be needed in the future to ensure that policy remains joined up, and that all levels of government share ambitions and coherent objectives for the ports in Wales. The Wales Office should be central to this process. (Paragraph 77)

20. Government needs a thorough understanding of the needs and challenges facing the freight and ports sectors to be able to develop appropriate policies that can facilitate their growth. The Wales Freight Strategy is an example of a co-ordinated and inter- modal view of the freight sector which is supported by the Wales Freight Group and more recently the Ports sub-group, and is a model which could be used more widely by government. The Welsh Assembly Government will need to continue to work closely with the freight sector to understand logistics chains, the role of the Welsh ports in these and how government can facilitate their efficient operation by providing the right policy framework. Stakeholders such as the Welsh Freight and

Ports in Wales 55

Ports Groups are being used to ensure that relevant policies take account of the needs of this sector. This data should inform the Welsh Assembly Government’s discussions with the Department for Transport on issues affecting Welsh ports. The existence of these stakeholder groups should therefore result in the ports having a more effective means of proactively engaging with both the Department for Transport and the Welsh Assembly Government. (Paragraph 84)

21. We note that the Welsh Assembly Government Minister for the Economy and Transport does not see a role for the Wales Ports Group in liaising with the Department for Transport. Nevertheless, despite the reassurances from the Department for Transport that they regularly liaise with the ports, we are concerned that there is little consultation with the sector on relevant policy areas at a UK or England and Wales level. We recommend that the Department for Transport should use the Wales Ports Group as a means of consulting with the ports industry in Wales to gain a better understanding of their collective concerns regarding relevant government spending decisions. We also recommend that Department for Transport officials should participate in the Wales Freight Group, if the group believes this would enhance the Department’s understanding of the challenges facing the Welsh ports and wider freight sector. (Paragraph 85)

Cross border co-operation

22. The Department for Transport and the Welsh Assembly Government must work together to address cross-border rail and road issues affecting ports. Decisions on investment in the wider transport infrastructure have affected the efficient movement of goods and people in and out of the Welsh ports and the competitiveness of the Welsh ports. A lack of co-ordination has resulted in inadequate landside access to some Welsh ports in the past. Greater cross-border co- operation on this issue is essential and should form part of an integrated transport policy that covers all modes of transport. The Wales Office should facilitate and encourage this process. (Paragraph 91)

23. Both levels of government should ensure improvements and construction work on the Strategic National Corridors and the Welsh Trunk Roads Forward Programme are closely co-ordinated. We urge the Welsh Assembly Government and the Department for Transport to keep the whole supply chain in mind when considering transport infrastructure improvements and to consult fully with each other before commissioning such improvements. (Paragraph 93)

Roads

24. The lack of a dual carriageway serving the important ports in Pembrokeshire causes traffic congestion and longer journey times for vehicles and passengers using these ports. This issue impacts on their attractiveness to freight businesses. We acknowledge that there needs to be a sufficient justification for expenditure to dual this route and that the Welsh Assembly Government’s current approach allows for dualling in the future, should this be justifiable financially. The Welsh Assembly Government should keep this issue under review so as to ensure that ports in

56 Ports in Wales

Pembrokeshire are not disadvantaged by an inadequate road connecting them to the main motorway network. (Paragraph 98)

25. The Welsh Assembly Government’s consultation on the National Transport Plan proposes improvements that will address the capacity issues on the A55 across the Menai Strait. We welcome these proposed improvements and urge the Welsh Assembly Government to ensure they take place as soon as possible. (Paragraph 101)

New links from the ports

26. Where expanding a port’s operations requires investment in road and rail infrastructure, it is right that the developer should pay a proportion of the cost. However, our evidence suggests that existing guidance is unclear about the extent of public funds which may be available to assist development. Both governments should provide more clarity on the contribution they are willing to make to such developments and within a timeframe that enables ports to plan their future business activities and investments. (Paragraph 106)

Rail

27. Upgrades of the rail network would be required if rail were to contribute fully to the transport of goods to/from Welsh ports. We welcome the UK Government’s recent announcement on the electrification of the line from London to south Wales, which will provide more capacity for goods on the railway, therefore more opportunity to move goods by train. The Department for Transport should clarify whether there will be benefits for freight as a result of this development. (Paragraph 112)

Strategic and land use planning

28. The level of importance afforded to the ports as economic drivers varies across local authority areas in Wales. This can have an impact on not only policies within the area, but also policies that cross local authority boundaries, such as transport. The Welsh Assembly Government has a central role to play in ensuring that local authorities recognise the potential of ports and that the planning system and transport infrastructure operate ways that benefit the ports, or will be able to benefit the ports in the future. The Department for Transport must play its part and the Wales Office must ensure that different levels of government are joined-up and that cross-border co-operation takes place. We reiterate the importance of considering the whole freight supply chain in policy and planning decisions, both locally and nationally. (Paragraph 117)

Land use conflicts

29. Land suitable for use as harbours or ports is a valuable resource, and in urban settings is non-renewable: once given over to other purposes it cannot be easily replaced. The port operators are best placed to understand the requirements of their business and to identify land which is surplus but they should do this in close consultation with the business and local community. Whilst disposing of land for

Ports in Wales 57

non-port related functions, such as housing, might provide the ports with higher financial returns in the short term, the local authorities should work closely with the port operators to ensure that it does not compromise any future development at the ports that might lead to job creation in the local area. Where necessary, local authorities should use their planning powers to restrict use of land to port-related functions and secure it for the future. (Paragraph 121)

Environment

30. Renewable energy developments in the Severn Estuary could significantly impact on the tidal regime in the estuary, which in turn could affect the operations of the ports in Cardiff and Newport. Provided that adequate locking facilities are built in, not all these implications would necessarily be negative. The UK and Welsh Assembly Governments should give careful consideration to the potential impact of any development in this area on the South Wales ports, together with the Wales Freight Group. (Paragraph 126)

Threats

31. We heard in evidence that joint assessments of all of the risks between different authorities do not happen at present and that there may be scope for greater coherence between the different arrangements. This lack of coherence could lead to differing priorities over the allocation of resources for security. Witnesses reassured us that this area is kept under review, but we recommend greater harmonisation of risk assessment methodologies to ensure consistency. We further recommend that the proposed Joint Committee on the National Security Strategy examine this aspect of national security at an early opportunity. (Paragraph 135)

Border control

32. We urge ports and carrier companies to work more closely with the UK Border Agency to ensure that correct and timely passenger and crew information is provided. This would help the authorities to develop an accurate picture of movements in and out of the UK from the Common Travel Area. (Paragraph 138)

Police and border control staffing at ports

33. In light of conflicting evidence, the Welsh Assembly Government, Wales Office and the Home Office should ensure the engagement of SOCA (the Serious Organised Crime Agency), Special Branch and the Security Service (MI5) in identifying, categorising and tackling the threat, in liaison with other law enforcement and order protection agencies. (Paragraph 143)

Milford Haven

34. We emphasise that witnesses did not state that specific threats to Milford Haven had been identified. However, we did hear concerns about the risk of a threat and the specialist capability of the local police force, Dyfed Powys Police, to respond in the

58 Ports in Wales

necessary time, as defined by the Home Office, to deal with any incidents at such a site. Milford Haven is a vital port and has expanded rapidly. Dyfed Powys Police must be adequately resourced to deal with the demands they now face in this area. We recommend that additional resources be made available to Dyfed Powys Police to enable it to undertake these activities. These resources must be proportional to its additional responsibilities and must reflect the importance of Milford Haven to the whole of the UK. (Paragraph 146)

Co-operation

35. There is considerable co-ordination between agencies within Wales, with relevant bodies across the border, and nationally, on issues of ports security. Co-operation between the police and authorities dealing with control of the borders is particularly efficient and avoids duplication and overlap. (Paragraph 152)

36. However, we are concerned that the evidence we received suggested there were gaps in existing arrangements and that relationships could be improved. Minimising the threats to the ports and their hinterlands requires all the relevant players to co- operate effectively. The authorities and the private sector will need to work closely to facilitate this. The ports and ferry operators must play their part in ensuring that the authorities, such as the UK Border Agency, have adequate information on passengers travelling into the UK. (Paragraph 153)

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Formal Minutes

Tuesday 27 October 2009

Members present:

Dr Hywel Francis, in the Chair

Mrs Siân James Albert Owen

Mr David Jones Hywel Williams

Alun Michael Mark Williams

Draft Report (Ports in Wales) proposed by the Chairman, brought up and read.

Ordered, That the Report be read a second time, paragraph by paragraph.

Paragraphs 1 to 165 read and agreed to.

Summary agreed to.

Resolved, That the Report be the Fifteenth Report of the Committee to the House.

Ordered, That the Chairman make the Report to the House.

Ordered, That embargoed copies of the Report be made available, in accordance with the provisions of Standing Order No. 134.

[Adjourned until Tuesday 3 November at 10am

60 Ports in Wales

Witnesses

Tuesday 2 June 2009 Page

Dr Anthony Beresford, Senior Lecturer, Logistics and Operations Management, Cardiff Business School, and Mr Callum Couper, Chair, Wales Freight Group Ev 1

Tuesday 9 June 2009 Page

Mr Giovanni Mendola, Maritime Transport and Ports Policy, DG Tren, European Commission Ev 12

Mr Robin Smith, Welsh Representative, Rail Freight Group; Mr Christopher Snelling, Head of Rail Freight and Global Supply Chain Policy and Mr Stephen Kelly, Head of Policy Midlands, Wales and South West, Freight Transport Association; and Mr Michael Farmer, Regional Director, Road Haulage Association Ev 15

Tuesday 23 June 2009 Page

Mr Matthew Kennerley, Port Director, South Wales Ports, Associated British Ports, Mr David Whitehead, Director, British Ports Association and Mr Ted Sangster, Chief Executive, Milford Haven Port Authority Ev 22

Mr Bryan Graham, Head of Planning Services, City and County of Swansea, Mr Richard Workman, Director of Technical Services, Carmarthenshire and Mr Kefin Wakefield, Head of Economic Development, Pembrokeshire County Council Ev 29

Tuesday 30 June 2009 Page

Ms Margaret Llewellyn, Cruise Wales, and Mr Jon Pinnington, Business Development Manager, Isle of Anglesey County Council Ev 34

Mr Matt Grimes, Director, Planning, Ports and Logistics, Fred Olsen Cruises, and Mr Keith Blundell, Head of Tourism, City of Liverpool Ev 39

Mr Paddy Walsh, UK Ports Manager, Irish Ferries, and Mr Tim Reardon, Chamber of Shipping, representing Stena Line Ev 44

Ports in Wales 61

Tuesday 7 July 2009 Page

Assistant Chief Constable Colette Paul, Protective Services, Detective Chief Inspector Andy Jenks-Gilbert, Strategic Ports Lead, Wales Extremism and Counter Terrorism Unit, Association of Chief Police Officers Cymru; and Mr John Whyte, Director Central Region, Uk Border Force and Mr Bob Lyne, Assistant Director for UK Border Force Central Region, Wales, UK Border Agency Ev 48

Tuesday 14 July 2009 Page

Paul Clark MP, Parliamentary Under Secretary of State for Transport, and Mr Robert Davies, Policy Adviser, Ports Division, Department for Transport Ev 55

Mr Ieuan Wyn Jones AM, Deputy First Minister and Welsh Assembly Government Minister for the Economy and Transport, Mr James Price, Director Transport and Strategic Regeneration, Mr Keith Thomas, International Connectivity Manager, and Mr Tim James, Director Integrated Public Transport, Welsh Assembly Government Ev 61

List of written evidence

1 Written evidence from Associated British Ports (ABP) Ev 67 2 Written evidence from Dr A K C Beresford Ev 70 3 Written evidence from the British Ports Association and the UK Major Ports Group Ev 73 4 Written evidence from Cardiff Harbour Authority Ev 76 5 Written evidence from the Chartered Institute of Logistics and Transport (UK) Cymru Wales Ev 76 6 Written evidence from Callum Couper, FCILT, Chair, Wales Freight Group Ev 78 7 Written evidence from Cruise Wales Ev 80 8 Written evidence from the European Commission Ev 82 9 Written evidence from Fred. Olsen Cruise Lines Ev 85 10 Written evidence from the Freight Transport Association (FTA) Ev 91 11 Written evidence from Professor Frank Gregory Ev 94 12 Written evidence from Irish Ferries (UK) Limited Ev 97 13 Further written evidence from Irish Ferries Ev 101 14 Written evidence from the Isle of Anglesey County Council Ev 105 15 Supplementary written evidence from the Isle of Anglesey County Council Ev 109 16 Written evidence from Milford Haven Port Authority (MHPA) Ev 110 17 Supplementary written evidence from Milford Haven Port Authority Ev 112 18 Written evidence from the Port of Mostyn Ltd Ev 114 19 Written evidence from Pembrokeshire County Council Ev 117

62 Ports in Wales

20 Written evidence from the Rail Freight Group Ev 120 21 Written evidence from the Road Haulage Association Ltd (RHA) Ev 122 22 Written evidence from the Royal Society for the Protection of Birds Ev 125 23 Written evidence from the Royal Yachting Association Ev 128 24 Written evidence from Saga Shipping Company Ev 130 25 Written evidence from South West Wales Integrated Transport Consortium (SWWITCH) Ev 131 26 Written evidence from Stena Line Ports Ltd Ev 140 27 Written evidence from the City and County of Swansea Ev 146 28 Written evidence from the Department of Transport Ev 153 29 Written evidence from the UK Border Agency Ev 160 30 Written evidence from Unite Ev 161 31 Written evidence from the Welsh Assembly Government Ev 164 32 Written evidence from Neath Port Talbot County Borough Council Ev 166 33 Written evidence from Liverpool City Council Ev 167 34 Supplementary written evidence from Pembrokeshire County Council Ev 168 35 Supplementary written evidence from Pembrokeshire County Council Ev 168

Ports in Wales 63

List of Reports from the Committee during the current Parliament

Session 2008-09

First Report Cross-border provision of public services for Wales: HC 57 Further and higher education

Second Report Globalisation and its impact on Wales HC 184 –I, II Third Report Proposed National Assembly for Wales (Legislative HC 5 Competence) (Agriculture and Rural Development) Order 2008 Fourth Report Work of the Committee 2007-08 HC 252 Fifth Report The provision of cross-border health services for HC 56 Wales Sixth Report Proposed National Assembly for Wales (Legislative HC 306 Competence) (Social Welfare) Order 2009 Seventh Report Legal Services Commission Cardiff Office HC 374 Eighth Report Potential Benefits of the 2012 Olympics and HC 162 Paralympics for Wales Ninth Report The proposed National Assembly for Wales HC 348 (Legislative Competence) (Welsh Language) Order 2009 Tenth Report Cross-border provision of public services for Wales: HC 58 Transport Eleventh Report English Language Television Broadcasting in Wales HC 502 Twelfth Report Proposed National Assembly for Wales (Legislative HC 678 Competence) (Environment) Order 2009 Thirteenth Report Digital Inclusion in Wales HC 305 Fourteenth Report Proposed National Assembly for Wales (Legislative HC 778 Competence) (Health And Health Services And Social Welfare) Order 2009 Fifteenth Report Ports in Wales HC 601 First Special Report The proposed draft National Assembly for Wales HC 200 (Legislative Competence) (Housing) Order 2008: Government Response to the Committee's Seventh Report of Session 2007–08 Second Special Report Cross-border provision of public services for Wales: HC 378 further and higher education: Government Response to the Committee’s First Report of Session 2008-09 Third Special Report Proposed National Assembly for Wales (Legislative HC 410 Competence) (Agriculture and Rural Development) Order 2008: Government Response to the Committee’s Third Report of Session 2008-09 Fourth Special Report Globalisation and its impact on Wales: Government HC 538 Response to the Committee’s Second Report of Session 2008-09

64 Ports in Wales

Fifth Special Report The National Assembly for Wales (Legislative HC 605 Competence) (Social Welfare) Order 2009: Government Response to the Committee's Sixth Report of Session 2008-09 Sixth Special Report Legal Services Commission Cardiff Office: HC 825 Government Response to the Committee's Seventh Report of Session 2008-09 Seventh Special Proposed National Assembly for Wales (Legislative HC 1024 Report Competence) (Welsh Language) Order 2009: Government Response to the Committee's Ninth Report of Session 2008-09 Eighth Special Report Digital Inclusion in Wales: Government Response to HC 1050 the Committee's Thirteenth Report of Session 2008- 09

Session 2007-08 First Report Energy in Wales: follow up inquiry HC 177 Second Report The proposed Legislative Competence Order in HC 44 Council on additional learning needs Third Report Work of the Committee in 2007 HC 325 Fourth Report The proposed National Assembly for Wales HC 257 (Legislative Competence) Order in the field of social welfare 2008

Fifth Report The proposed draft National Assembly for Wales HC 576 (Legislative Competence) (social welfare and other fields) Order 2008 Sixth Report The provision of cross-border health services for HC 870 Wales: Interim Report Seventh Report The proposed draft National Assembly for Wales HC 812 (Legislative Competence) (Housing) Order 2008 First Special Report The proposed Legislative Competence Order in HC 377 Council on additional learning needs: Government response to the Committee’s Second Report of Session 2007-08 Second Special Report Energy in Wales – follow-up inquiry: Government HC 435 Response to the Committee’s First Report of Session 2007-08 Third Special Report The proposed National Assembly for Wales HC 715 (Legislative Competence) Order in the field of social welfare 2008: Government Response to the Committee’s Fourth Report of Session 2007-08

Session 2006-07 First Report Work of the Committee in 2005-06 HC 291 Second Report Legislative Competence Orders in Council HC 175 Third Report Welsh Prisoners in the Prison Estate HC 74 First Special Report Government Response to the Committee’s Second HC 986 Report of Session 2006-07, Legislative Competence

Ports in Wales 65

Orders in Council

Session 2005-06 First Report Government White Paper: Better Governance for HC 551 Wales Second Report Proposed Restructuring of the Police Forces in Wales HC 751 Third Report Energy in Wales HC 876-I Oral and written Energy in Wales HC 876-II Evidence Fourth Report Future of RAF St Athan HC 1129 Fifth Report Current Restructuring of the Police Forces in Wales HC 1418 Oral and written NHS Dentistry in Wales HC 771-i Evidence First Special Report Government Response to the Committee’s Second HC 433 and Third Reports of Session 2004–05, Manufacturing and Trade in Wales and Public Services Ombudsman (Wales) Bill Second Special Report Government Response to the Committee's Fourth HC 514 Report of Session 2004-05, Police Service, Crime and Anti-Social Behaviour in Wales Third Special Report Government Response to the Committee's First HC 839 Report of Session 2005-06, Government White Paper: Better Governance for Wales Fourth Special Report Government Response to the Committee's Second HC 1431 Report of Session 2005-06, Proposed Restructuring of the Police Forces in Wales Fifth Special Report Government Response to the Committee's Third HC 1656 Report of Session 2005-06, Energy in Wales Sixth Special Report Government Response to the Committee's Fourth HC 1657 Report of Session 2005-06, Future of RAF St Athan Seventh Special Report Government Response to the Committee's Fifth HC 1695 Report of Session 2005-06, Current Restructuring of the Police Forces in Wales

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Welsh Affairs Committee: Evidence Ev 1 Oral evidence

Taken before the Welsh Affairs Committee on Tuesday 2 June 2009

Members present Dr Hywel Francis, in the Chair

Mrs Siaˆn C James Mark Pritchard Mr David Jones Hywel Williams Alun Michael Mark Williams Albert Owen

Witnesses: Dr Anthony Beresford, Senior Lecturer, Logistics and Operations Management, CardiV Business School, and Mr Callum Couper, Chair, Wales Freight Group, gave evidence.

Q1 Chairman: Good morning and welcome to the You see it with ports like Liverpool having been in Welsh AVairs Committee and this inquiry on Ports the ascendancy for the past decade and the other in Wales. For the record could you introduce West coast ports are also on their way up as well. yourselves, please? Dr Beresford: If I could add to those points, the Dr Beresford: Dr Anthony Beresford, CardiV interesting trends that were clear in the 1960s and Business School, Senior Lecturer in Transport and 1970s of West coast ports by and large declining, Logistics. have dissolved in the 1980s and 1990s and the Mr Couper: Callum Couper, I am the Port Manager pattern of port performance has actually been much at CardiV and Barry and Chair of the Wales more mixed. We have seen in the last 15 years, Freight Group. perhaps as much as 20 years, a resurgence if you like of the niche ports, smaller ports, West-facing ports and the disadvantage of not facing Europe has Q2 Chairman: I say this to all witnesses in this room: diminished. We do see, therefore, new arrivals in the the acoustics are not brilliant so please do not be Mostyn, North Wales opportunistic movement of afraid to raise your voices. Could I begin by asking Airbus wings, we see in South Wales the LNG and you a very straightforward question: what are the the trend is no longer visible, possibly at all, but it key strengths and weaknesses of Welsh ports? certainly was visible for 20 or so years, a decline in Mr Couper: One of the strengths is that there is a bit the West, a rise in the East. of diversity in Wales in terms of the function of the ports and particularly the trade to Ireland, both UK trade and the land route trade from Europe; of Q3 Chairman: What would you consider to be the course Milford in isolation is an energy port, Port key decisions that need to be made in order to ensure Talbot is one of only three facilities in the UK that the future prosperity of our ports and who are the can take deep-laden capesize vessels, it is quite a key decision-makers here? unique port facility and there is the range of general Mr Couper: There are some clear areas, in particular cargo ports in industrial South Wales that can reach with globalisation of trade and with looking at into the Midlands and the M4 corridor. All this gives Wales’ gateway ports for international trade, and a bit of spread that can take the ups and downs in whilst we are not and are unlikely to be in a position economic activity but the strengths and weaknesses with the existing spread of ports, although there is will vary over time. The time we are in at the moment one exception, containerisation, the retail trade has means that there is great potential for Welsh ports in not been a big feature of South Wales, but we can general to expand the range of activities that they have feeder services from European hubs, from these undertake and their functions and to take advantage ports that will take these super post-panamax of a time of change with further internationalisation container ships that only call at a few ports for the of trade and also the shift in the energy markets, fact that (a) only a few ports can handle them decarbonisation and those imperatives as well. So physically and (b) they want to make as few calls as we have some limitations and weaknesses, possible. That trend is one that we should be looking particularly in South Wales, in that it is a very tidal to develop and add value within the region and add estuary, as you are aware, so these ports are not as facilities and the logistics jobs that are not currently accessible as some of the open harbours. Also, of there. There is also the energy sector with the import course, we are on the West coast and although that, of biofuels and biomass, also the generation of cyclically, is coming back into a more favourable energy on or near port estates and the processing of environment—because mostly trade has been East- fuels on or near port estates. There has been an facing towards Europe with the accession to the EU inversion or there is an inversion going on from the and also the shift in our trading relationships—the concentration of energy generation around the old West coast has suVered, but it is on the way up again. coalfields and the Rivers Trent and Ouse in the Processed: 29-10-2009 19:44:46 Page Layout: COENEW [E] PPSysB Job: 435922 Unit: PAG1

Ev 2 Welsh Affairs Committee: Evidence

2 June 2009 Dr Anthony Beresford and Mr Callum Couper centre of the country; much of this is going to have should be targeted at reducing congestion which is to occur at import centres and the ports are well largely dependent on car use. If we look at freight, if equipped to do that. That will involve perhaps grid a charge is levied on trucks—typically per mile, but reinforcement so that where there is generation on or it would not have to be, it could be a point to point near the port estates the power can be put into the charge or a threshold charge—then my belief is that areas of consumption and also good surface links, that sort of charge should be looked at very carefully, particularly with rail, to be able to get solid fuels into possibly with a view to setting it at zero. existing generation areas. Those are two quite Chairman: Mr Mark Pritchard and then Mr Mark tangible areas that need some further work, Williams. particularly linking with the regional planning, the economic planning and the LDPs. The ports themselves have plenty of spare capacity because of Q5 Mark Pritchard: Thank you Chairman. Good historically where they come from and the trade they morning, gentlemen, and if I may I would like to lead are doing now, and a lot of this capacity can be taken you back to strengths and weaknesses. Terrorists plotting their terror I hope will miss Wales; up. With the changes in geography, trade and nevertheless, many ports in Wales, Haverfordwest consumption, local authorities or LDP makers need for example, might be seen as a high profile but to start thinking about linking the port as part of the perhaps soft target. I just wondered whether you oVering, both to enhance inward investment and to think there is enough security around the key major reinforce what is going on there. The employment ports in Wales and, even if there is, what you might sites within the vicinity of ports should be linked like to see put in place to improve it given the strategically with the ports themselves, I believe. heightened times we live in. There are, therefore, a number of areas that need to Mr Couper: My interest is predominantly freight, be thought through a little more to enhance the value but clearly some ports are ropax, dealing with freight of ports because they are very, very tangible and passengers. We have recently got the ISPS code, economic drivers for regions and indeed nationally. the International Shipping and Port Security code, Dr Beresford: May I add a few points? The reliance which has really created a baseline across the UK for on road is well known in the UK—rail does an security at ports and the ships they interface with, excellent job for certain commodities on certain and there is also European legislation which the UK routes but the reliance on road obviously generates will absorb and implement which really looks at the the congestion problem that we are all aware of. One port as a whole, not just the ship-shore interface. As additional burden that Wales has to bear of course is far as the cargo ports are concerned there has been a the unidirectional toll across the Severn Crossing— marked tightening of the security arrangements and for trucks I guess it will not be long before it is £20. supervision in that respect. At passenger ports there The fact is that you are very distance-sensitive if you is a hierarchy of security measures and passengers, are on the edge of a market. Wales is somewhat to the chemicals, roll-on-roll-oV and containers are at the west of the centre, which is clearly the south-east of upper end, and the bulk ports and general cargo England, the Midlands and of course onwards to ports are slightly down on the facilities and you can central parts of Europe, so every mile that is covered have designated security areas, restricted zones, is a cost. If you are in a peripheral location you do within ports of various sorts, so there has been a need very eYcient logistics to keep those per mile general improvement in security. I cannot speak costs and indeed per hour costs—because a lot of directly for the transit of people and when you look your costs are obviously time costs also—to an at Fishguard and Holyhead, they are two examples absolute minimum. The ability of South East in particular where private individuals and cars England, the Low Countries and industrial parts of rather than just freight are transiting. The ISPS code Germany to absorb transport costs which are rather has created a baseline for security arrangements at high is fairly great, but our ability in Wales, ports. particularly West Wales and North Wales, to absorb high transport costs is less. We need to have as low as possible transport logistics costs. Q6 Mark Williams: Can I return to some of the Chairman: Mr David Jones, did you wish to ask a opportunities for new business that you talked of supplementary? earlier? You outline in particular the energy market and we have heard about obviously LNG and Airbus and the use they make of Mostyn and Q4 Mr David Jones: Yes, briefly on that point, Dr Pembrokeshire, but how will ports themselves Beresford, as you know the Local Transport Act attract that new business? You talk about the need gives the Welsh Assembly Government powers to for an integrated approach with the LDP but is that impose trunk road charges in Wales. It seems to me integrated approach being realised at the current from what you have just said that if the Assembly time and, secondly, who is going to make the Government were to impose such a charge the necessary investment to promote that integrated impact upon Welsh ports would be pretty severe. approach? Is it going to be the public or the private Dr Beresford: Yes, potentially; of course it all sector and are the returns ultimately—I suspect you depends on the level of the charge. My belief is that will not know the answer to this—going to warrant a charge should have a purpose and if the charge, if the kind of investment that is required to promote it were implemented, is to reduce congestion then it that approach? Processed: 29-10-2009 19:44:46 Page Layout: COENEW [O] PPSysB Job: 435922 Unit: PAG1

Welsh Affairs Committee: Evidence Ev 3

2 June 2009 Dr Anthony Beresford and Mr Callum Couper

Mr Couper: The business model for the private ports extent would you say that Welsh ports are competing and, for example, the Associated British Ports with English ports for business and to what extent Authority, is that we look for medium to long term would you say they are doing so successfully? investments with customers. They want to achieve a Dr Beresford: Maybe I should make the first certain flow to their process and they need the port comment. There is competition, clearly; Bristol is to do that, so we intend to invest in facilities on their not far away from Callum’s port, there is behalf, particularly when they are storage facilities competition in the North, there was competition to or land or servicing that we can do back to back with engage in the Airbus project and so on, so there is a contract with these people. Thus we are looking to England-Wales competition without a doubt. On the secure as far as we can our investment and have a other hand I prefer to see it as a system where the payback over a period of five, 10, 15 or 20 years capability of English ports is across the range. There depending on the scale of investment. I think if you are clusters of large ones, there are several very small layer it up further the responsibility falls wider. The ones; similarly, the Welsh ports do certain jobs: the privatised model for ports management in the UK land bridge to Ireland comes to mind and so on. I do has been successful over the past 15 years and there see competition, there is no doubt, for cargos and I has been a tremendous amount of investment in am sure Callum can allude to specific examples logistics facilities at ports which has benefited ports, where he has had to, as it were, secure business employment and the economy, particularly the against English competitors, but also I think there is regional economy, and the country as a whole. There a mutual dependence as well. A case in point would is a great deal of capacity around the UK and so be Irish passenger traYc clearly bridging across people can seek out the most eYcient way of getting Wales and across England into the continent, and their goods to and from the marketplace. However, that flow is quite a significant and substantial one— that reaches a point where surface transport in the vehicular flow of passengers primarily but also, particular and the availability of road and rail needs obviously, trucks. There is an interdependence to match the volume and the scale of activity at the therefore as well as competition and if you were to port. The port is not in a position to fund entirely the A to B as if it has some exclusive claim over it, and say to me or ask me which ports compete it is quite I think that is where there is inevitably a tension of an interesting progression of the discussion and investment. Callum and I would possibly not entirely agree on the pairings.

Q7 Mark Williams: Given the hopes that you aspired to earlier on—both of you commented about an Q9 Mr David Jones: That is something that we are integrated approach—how big a problem is that interested in. tension? Is that an understatement or is that an Dr Beresford: Clearly in the short sea we have accurate thing? The perception is that you have an competition—several South Wales ports competing Assembly approach which is more proactive, at least with Bristol potentially, we have got the South Wales in its vision, and a light touch approach at the UK ports competing with the direct Ireland to level whereas we need a fully integrated approach, continental Europe route, which could be done particularly in terms of transport infrastructure in diVerently, we have competition in North Wales the vicinity of ports. Are your hopes going to be between Liverpool and obviously Holyhead for the realised? ro-ro traYc, but there are other examples as well, Mr Couper: We are in an environment now where and so there are England-Wales competitors. I do perhaps we can be looking a bit more strategically at not think the Welsh ports come out of it badly; they how the decision-makers in the ports and also the know what the business is and a lot of the shakeout customers for the ports can sit alongside the regional has taken place. That is not to say that the industry planning, and where there is road and rail capacity is standing still, there are still, clearly, very large there is a lead time and that is programmed in to changes that could take place, not least the loss of accommodate some of the things that may happen in bulk traYc in South Wales—Port Talbot’s role with the future. For example, Port Talbot is a very the steel for example. There are examples, therefore, significant facility in the UK; it is largely focused on where ports may well have to face dramatic change the steel-making business at the moment, the drive- and the mix of who is competing with whom could on cargos, but it has got potential in the future for a well change along with that. range of cargos and it will need those surface links to move those cargos into the hinterland. That is something beyond the ports and whether they are Q10 Mr David Jones: You mentioned Holyhead and private or a trust or whatever, that involves a much Liverpool; I actually used to live in a house that higher level of things and developing into the overlooked Liverpool Bay and I used to find it forward movement of the regional plans, the extraordinary really that you would see these cargo transport plans and the economic plans. It is a ships sailing past Holyhead all the way to Liverpool joint thing. when it seemed to me that they could have saved themselves a lot of turnaround time if they had Q8 Mr David Jones: We have already touched on the actually docked in Holyhead. What could Holyhead fact that West coast ports have enjoyed something of do, for example, to compete more eVectively with a resurgence over the last 10 to 20 years, but to what Liverpool? Processed: 29-10-2009 19:44:46 Page Layout: COENEW [E] PPSysB Job: 435922 Unit: PAG1

Ev 4 Welsh Affairs Committee: Evidence

2 June 2009 Dr Anthony Beresford and Mr Callum Couper

Dr Beresford: Clearly there is a segmentation of the Q13 Mr David Jones: In terms of maximising the market. If we deal with passengers, ro-ro passenger benefits of that interdependence it seems to me that traYc for a moment, passengers tend to like to sea- most of the road improvements would be required in minimise and land-maximise, so they tend to seek England rather than in Wales. out the shortest sea routes—not necessarily for the Dr Beresford: There are bottlenecks nonetheless, same reasons. Some might be seeking the lowest and again Callum would be able to detail some of cost, some do not like seasickness or whatever. As these, but I have carried out some unpublished regards freight, it is invariably to do with either the research on road freight rates and it is quite logistics chain—where the freight is starting and interesting how those actually mirror more or less finishing—or it is straight cost and the haulage cost the congestion pattern of the UK, running at, say, routing through Holyhead would be, let us suppose, £1.30 a mile in uncongested areas and running at up driver-accompanied something in the order of £1.50 to £2.00 to £2.20 a mile in and around the M25 area a mile and the alternative routing through Liverpool with higher rates also in the West Midlands and so would stack up against that calculated total cost. on. There is, therefore, an immediate impact of The two situations are slightly diVerent, the freight persistent congestion. Translating that to Wales against the passenger, clearly.If the freight is cheaper there are pinch points and perhaps it would be through Liverpool, sea-maximising somewhere into appropriate to hand over to Callum to pick those up. Ireland, maybe close to the coast, it will tend to be Mr Couper: Just to refocus the question, road that solution that is taken. But passengers, my transport is the most expensive and environmentally research and my experience tell me, do tend to like it has the greatest impact; sea transport is the most the shorter crossings, though not exclusively benign from an environmental point of view and it is obviously. also the lowest cost form of transport. The imperative really, therefore, is to use the ship and to Q11 Mr David Jones: You have mentioned the get the ship as close as possible to the origin or interdependence between ports; which ports would destination of the cargo and that is where the ports you say are those upon which Welsh ports are mostly of Wales can play a part, with the use of coastline interdependent? I would have thought they are shipping to replace one form of road transport and probably on the other side of the country. also with the development of container transit, by Dr Beresford: Yes. Clearly there are cases—and the feeding in from deep sea hub ports, getting recent bulk importation from the Middle East is a containers into the UK for the first time via Welsh case in point—where the UK relies largely now on ports. Not only does it reduce the amount of road that gateway to Milford Haven, so there is that miles that currently are used, it also provides dependence. As regards the other way round, the ro- opportunities for new investment in logistics and ro ports and the container ports of the big gateways distribution in the Welsh ports as opposed to this of the East Coast—Southampton, Felixstowe, being done at places like Felixstowe. The single most Tilbury, Thamesport and so on—clearly Wales is immediate benefit is environmental but there are dependent on those for deep sea imports because benefits also to retail goods and raw materials they are the deep sea ports. I do prefer to have an coming into Wales and also to manufacturers in image if you like, a vision, of mutual support as Wales of steel and chemicals that are going to opposed to competition with the England-Wales Europe and globally, allowing them to have direct combination. access and good connectivity to deep sea container services. Those are things that really should be done in Welsh ports and then you take out that long run Q12 Mr David Jones: The key to maximising the across to Felixstowe, up the M4 and the A14, which benefits of that interdependence would be, I would environmentally is not good and economically and have thought, good road and rail links. reliability-wise does not give the Welsh shippers and Dr Beresford: There is no doubt about that. Again, receivers as fair a crack of the whip as those closer to Callum will have views on the rail links and so on to where all the action is. the South Wales ports, but I can remember in the Chairman: I am conscious of time; we have only case of Felixstowe when the volumes were growing, dealt with one part of our inquiry so far and I would roughly speaking, at 10% per annum and, somewhat urge everyone to speed things up a little. Mr Jones. belatedly, it was recognised that additional road capability around Ipswich and so on was necessary, not to mention the A14. The road links just about Q14 Mr David Jones: On the issue of government caught up with the volumes going through policy it seems to me that the Department for Felixstowe and the rail enhancement, with Transport has adopted a non-interventionist stance, additional terminals at Felixstowe itself and the almost laissez-faire. To what extent has the Welsh gauge capability for high cube nine foot six Assembly Government got a developed policy with containers followed in due course. There are still regard to ports—presumably it would be port several bottlenecks though, 20 or so significant infrastructure rather than ports themselves—and to bottlenecks in the rail network at the moment as we what extent are they liaising and integrating their speak, but the role of the road improvements and the policy with the DfT? rail improvements would be major, diYcult to Dr Beresford: I will take a general point if I may on quantify precisely but absolutely vital to UK Plc to that. My first involvement in government policy on have good access to those main ports. Felixstowe is ports was around about the year 2000 when things merely an example. were becoming sharper with the Dibden public Processed: 29-10-2009 19:44:46 Page Layout: COENEW [O] PPSysB Job: 435922 Unit: PAG1

Welsh Affairs Committee: Evidence Ev 5

2 June 2009 Dr Anthony Beresford and Mr Callum Couper inquiry at Southampton, and the comments that Chairman: Could we move on now to infrastructure? were coming in my direction, general informal Mr Alun Michael. comments, were that it was very much a hands-oV policy and the feeling was that the ports were by and Q17 Alun Michael: I do not want to ask the question large very capable of looking after themselves. I am whether a Severn Barrage would be a good thing or not sure that was entirely correct or productive a bad thing, but if it were to be built on what appears looking forward; maybe there is a need for a firm still to be the most likely line, what impact would hand to appreciate that, particularly now that we that have on the ports in South and West Wales have data availability on what goes where in precise particularly? terms and the technology to support that. There Mr Couper: Associated British Ports has got three maybe could be a case for a more persuasive policy ports very close to the line if one of the five options to identify, for example, some ports in Wales which under evaluation at the moment became could benefit from the support of particular government policy and were to progress; CardiV and terminals or, possibly, transport access, particularly Newport would be within the line of a barrage and, rail access I would suggest, but on specific cases yes, it would have a significant impact on the ability again, Callum, could you pick up? of those ports to trade in their existing format Mr Couper: I would lean slightly more to the existing because it is likely that there would be a reduction of model of the ports being allowed to have their own about one metre in high water, which would reduce creative use of the assets, underpinned by the the amount of draught and thus the amount of cargo infrastructure being available, which comes from that ships could carry. spatial planning and transport planning and having the capability to get the goods in and out of these facilities. Having said that, from an environmental Q18 Alun Michael: Would Newport and CardiV still point of view we have got a tranche of grant in place have a future in those circumstances? for freight facilities—capital grants and also water Mr Couper: Yes, I think they would, but Associated grants for revenue support and there is also the EU British Ports is going through a process at the with the TEN-T programme such as Marco Polo, moment to try and identify the benefits and motorways of the sea, but they do not lend disbenefits of this because it may be that a barrage themselves easily to the sort of support that Welsh would alter the dynamics so that there would be ports would need to plug into some of the trade flows more tugs required, more pilots, more handling of that are not happening now which could have much the ship, a longer time transiting locks—all these broader benefits both for Wales and the UK and things then add to the ship owner increasing the environmentally. amount of freight that they charge the shipper and the receiver, which then alters the competitive position of where the ports are. We are going to have Q15 Mr David Jones: Reverting to the question to ask these questions and we are making our though is there any or any suYcient integration concerns known, and while I cannot say that there between policy at a national level and at a Welsh would be a wholly negative impact there are some Assembly level? very fundamental issues there for the ports. That is Mr Couper: The Transport Wales Act created for the the process that we are going through at the moment. surface links, for road and rail, a clear conduit for Welsh policy but obviously that does not exist for Q19 Alun Michael: What is the timescale of that ports, although it is interesting that the Welsh process? Assembly Government recognised during the Mr Couper: I believe it is now in phase two of a two- passage of that legislation that they would form a year evaluation and presumably by this time next Wales Freight Group and construct and publish a year the government will have enough information Wales Freight Strategy. That very much includes the to make a decision. ports in trying to integrate those modes of transport, so clearly their desire appears to be including the ports within their overall transport plans. Q20 Alun Michael: I meant ABP’s evaluation of the impact. Mr Couper: We are asking for certain clarification on Q16 Mr David Jones: Having said that, we had how locks would be managed, there would clearly be evidence a few weeks ago from the Welsh Transport a new authority set up, whether there would be Minister and, frankly, I was not persuaded that there charges, how we would address where loss of water was any great integration at all between the DfT and had diminished the tidal window through which the the Welsh Assembly Government in terms of a deep draught ships would go. freight transport strategy; is that a fair comment? Mr Couper: It is probably something which is still evolving, but if you are going to get the best out of a Q21 Alun Michael: It is at the stage of national government and a regional government one communications rather than conclusions then. would have thought the stronger the links and the Mr Couper: It is at the moment, yes. freer the reserved powers and jurisdiction the more eVective the decisions that are going to be (a) Q22 Alun Michael: Against that background—I do identified and (b) implemented. That is what the not want you to repeat yourselves because we have freight community wants. had some discussion about the interconnectivity Processed: 29-10-2009 19:44:46 Page Layout: COENEW [E] PPSysB Job: 435922 Unit: PAG1

Ev 6 Welsh Affairs Committee: Evidence

2 June 2009 Dr Anthony Beresford and Mr Callum Couper with the transport infrastructure and where there are Mr Couper: It is a good question; it is lacking and it weaknesses—is there anything that has not already is something which really should be addressed at this been covered in terms of the limits on the role of time whilst there are changes going on in response to ports as economic drivers, or what we can do about restructuring the economy and the globalisation of it, that you would like to add? trade. It is now that we need to capture this, and this Mr Couper: Again, it is getting on the radar now the is where intervention, if we can call it that, is limitations that may impact in the future. If, for necessary through supporting things that the market example, ports were going to be feeding containers, wants to do but will not quite happen on their own for example, into the Midlands, they would need because economically it does not work at the present suYcient loading gauge by rail to get them into the time. As I mentioned earlier, some of the European Midlands, with sustainable transport. We have not grants just do not lend themselves to many small really got that from South Wales anyway into the schemes which could support and make Midlands corridor—we have not got the width environmental improvements and also bring less through tunnels and platforms for high cube congestion via the south east of the country where containers which make up half the world’s containers come through now, to spread that activity population of containers. That is a particular further round the country and to allow Wales to question. actually participate and punch above its weight in terms of its port facilities. I had to look the other Q23 Alun Michael: Can I also ask what has been week at joining up a flow of cargo linking Le Havre, done to ensure the ports in Wales are considered an CardiV and an Irish port—for example Waterford— integral part of the Welsh and UK transport and looking to see what revenue support could be infrastructure? You both referred to the fact that the factored in. There are UK domestic grants that ports in Wales are integrated into the approach that might work, but they did not pass muster in that is being adopted to freight in Wales, but the wider particular instance where you have two EU states, one—are there any initiatives, either from the they lend themselves more to TEN-type funding but industry side or from government that are relevant the hurdles for TEN-type funding are just to having that broad approach, which is very much impossibly high for us to reach in terms of lorry miles what you have both argued is needed? and environmental benefits. They fit well for putting Dr Beresford: We are trying to draw attention to the cargo from Oporto to Genoa, over that distance, joined-up approach that we believe is necessary, that using the Mediterranean as opposed to moving it on the bulk of port activity freight-wise is involved in land; you can hit those targets, but you cannot really logistics chains, so a greater and more detailed do it for smaller schemes. I think there should be understanding of those chains as individual chains more imagination, both at the regional level and the for the movement of not necessarily containers but UK level to start achieving some of that because it is particular consignments of whatever they may be, is part of the greater understanding of why ports are this little window that we have got where all this is there and how we should handle our ports. There is going on and where things change. We need to the related issue of the profile of trust, municipal and capitalise on that. The ports in a way are bringing private ports, which actually is rather a diVerent mix sustainable development and employment in Wales vis-a`-vis the mix in England, and there are investment into parts of Wales that need it. some interesting examples where a port is owned in a way that you would not necessarily expect. There are funding issues of course with the municipals, the Q25 Mrs James: We have spoken about freight quite trust ports do what they have to do and the private a bit and what I have learnt from your evidence so ports are the ones that all the international shipping far is that freight is really the way forward when we lines tend to understand—they forget that we have a look at port development, because we have strayed huge number of non-privatised ports. There is a several times into that area but I would like to home political dimension to the mix of ownership: are our in on that a little bit at the moment. We know that ports owned in the right way in Wales and should we have got capacity and good facilities in Wales for they be diVerent from England? That is a dimension the development of freight and you have touched that is somewhat neglected, we have not really upon this but bear with me, what do you both see as looked at it—we as academics have not looked at it the key opportunities and barriers for Welsh ports in any particular depth, but we would be happy to with regard to freight transport? do so. Dr Beresford: Opportunities. Obviously over the last six months or however long you describe the diYcult Q24 Albert Owen: You have talked about Wales and times with freight volumes dropping, it has been the rest of the UK but of course lots of ports in something of an anomaly and the long-range particularly the Republic of Ireland have benefited forecast book of numbers would be unit loads going from European funds, as have many Welsh ports. up, the Irish traYc has been in recent months less Do you think there is a proper European strategy for reliable but certainly long term has picked up very, transport—does the TEN still exist, for instance, the very rapidly. There are clearly opportunities for Trans European Network, and is there really enough more trading with Ireland and I agree with Callum investment in it, is the UK doing enough to draw from Wales’ point of view we do wonder and both down the money to maximise the potential for independently in our reports suggested cruising— Welsh ports? that is people, I apologise, you wanted freight, but Processed: 29-10-2009 19:44:46 Page Layout: COENEW [O] PPSysB Job: 435922 Unit: PAG1

Welsh Affairs Committee: Evidence Ev 7

2 June 2009 Dr Anthony Beresford and Mr Callum Couper the opportunities are there on certain identified that has facilitated development and it is the shortest routes which would have to be taken case by case. I possible transit to where the cargo is being processed am wondering about Swansea; Swansea has when it comes back out again. Ports are very somehow been bypassed by the lines. Callum, have tangible devices for economic growth in a you got a comment on Swansea for the Irish sustainable way, therefore, and that understanding freight link? needs to get into regional government, where the Mr Couper: There is a lot of work being done to try LDPs are made and at these sorts of levels because and re-establish the Swansea-Cork ferry and it is very important that that starts being integrated. hopefully that will happen within the next 12 months I still see LDPs with no mention of the port at all and or so, but that was an important freight and I am astonished by it because it is just not perceived passenger route and there will be a role for it in the in the way it should be. There are very visible places future. There are various reasons why it disappeared like Holyhead and you know what that economy and trends will bring it back into play, but if we are would be without that three and half million tonnes looking at a 10, 15, 20-year horizon then we really of freight going in and out, but in other urban areas need to be looking at distribution facilities on or it is still almost invisible and that needs to be ramped close to the port estates and the connectivity with the up. In terms of the understanding of what ports and deep sea ports in Europe in particular. I have shipping can do, environmentally and economically, mentioned energy and some of the opportunities that is the message: that we need to raise the game. that are coming through there. There are shifts in the way that goods are distributed and with linkages with the LDPs and spatial planning processes we Q27 Mrs James: You have mentioned that we have could be in a position to take advantage of that. capacity and we have good facilities, we have Some of it will require more imaginative grant identified the market and we want this freight support to get it going as the economics change, as business so why has it not all happened yet? the environment moves towards new flows of cargo. Dr Beresford: Some of it is inch by inch. If I can just We need the surface transport links from the ports, focus on waste management as an interesting new both rail and road, and the searchlight is very much business—it is not that new, but the volume is going on decarbonising and it should be recognised that up, we are having to recycle, we are having to ports have a big role to play in that because the ship, distinguish between recyclable materials and non- as I said, is the most benign, has the least impact on recyclable. Increasingly they are designed in from the environment. day one in manufacture but it seems to me that one opportunity for Wales is to lock into the logistics of waste management. A lot has moved on in London Q26 Mrs James: Do you think there is enough being and obviously there is a huge amount of waste of done? We have touched on transport grants et cetera various types here, but with the legislation ramping and we have talked about spatial planning, but it up and as it were complicating waste in terms of its appears to me and maybe some other people that we are not quite linked up yet, are we? We have this definition, it seems to me that there is the possibility window of opportunity now; are you confident that for flows through Welsh ports in handling waste. we are doing enough in Wales, enough in the UK to Mr Couper: That has already happened in some actually link everybody up and get some real money cases and there has been a big investment at into this spatial planning now, the preparation. You Newport for recycling metals, ferrous items and V have mentioned Swansea and I see that the pressures electrical components. Cardi Container Line has between what is happening in SA1 for example, it is started a UK-Ireland, door-to-door container the last industrial area of Swansea where we have an service—that has been running since August last opportunity to develop but there are competing year and we are building that business up. It is the concerns. People want it as a leisure facility, a only unit load container lift-on-lift-oV service in housing facility; do you think we are doing enough? Wales and it is competing with the ro-ro trade. There Mr Couper: The short answer is no but Wales is the recent planning consent at Port Talbot for 300- Freight Group and things like this Committee’s megawatt wood-burning power generation, so some inquiry do put the searchlight on it. The bullet line of these things are happening but they are message, as the Eddington Report clearly showed, is discontinuous patchy things, we have not yet got the that connectivity is the key to economic growth. We mainstream linkages. If you are Dow Corning or want economic growth; we require economic growth Corus or if your markets are international and you that is sustainable and the ports are the facilitators cannot always put it in a big ship in bulk you want to achieve that. ABP has carried out research in the to put it in containers and get it to smaller customers, past couple or three years—and it has been you need that connectivity in Wales and we have not revalidated quite recently—which shows the got there yet. That is something that needs a lot of economic eVect of the ports on employment focus and that is where Swansea, CardiV, potentially investment in the region, and it is very strong, it is a Mostyn and other ports can play a part. very tangible thing. If you look at a port like Le Dr Beresford: If I can add to that, once you have Havre on Google Earth you will see that it is on its unitised something it is suddenly more mobile so you own, in green fields. It has a terrible road going up can compete; you can grab stuV from Birmingham to Rouen and then on to Paris, it has a couple of rail and from East Midlands and the port becomes the lines, but there is a massive amount of investment point of focus for actually a much wider market, there because it is what goes in and out of the port reaching into England comfortably, as well as Processed: 29-10-2009 19:44:46 Page Layout: COENEW [E] PPSysB Job: 435922 Unit: PAG1

Ev 8 Welsh Affairs Committee: Evidence

2 June 2009 Dr Anthony Beresford and Mr Callum Couper dealing with the local flows which are relatively easy region, developing those longer term businesses. to find. We are saying the same thing here but the Hopefully one of the by-products of this recession unitisation concept of fresh cargos is a possible area. will be that people can start looking at diVerent ways Mrs James: Thank you. of doing things and, of course, driving that strongly in terms of economics is the carbon imperative and Q28 Hywel Williams: I have just a couple of having to reduce the amount of fossil fuels we use. questions about the potential for Welsh ports. Mr Couper mentioned a couple of times this morning Q30 Albert Owen: Is it not the case though that with the eVects of the economic downturn and the the economic downturn we are more reliant on the potential opportunities for Wales, but is there a Irish economy as Welsh ports than the UK economy downside to that for Welsh ports? I am just thinking because that has contracted the quickest, and is not how Welsh ports are marketed to businesses and another factor fuel? Do you see the rise in fuel costs other European countries; are they aware of the as being short term or does it have to be factored in opportunities that are available in Wales? How are for the longer term in terms of fuel for vessels as they made aware of those opportunities? opposed to the lorries as well? Mr Couper: Answering your first point, there are Mr Couper: Fuel costs are clearly a very significant short term down sides to what is happening with the feature of all transport but shipping lines do tend to economy at the moment and we see that in have a mechanism to pass them on if they can, but it construction materials, the reduction in trade to is highly competitive and they are not always Ireland, in steel imports for manufacturing in successful in doing that. We certainly sensed perhaps particular, timber for construction, there is a general six to 10 months before the UK hit the beginning of reduction in the amount of traYc going through the this that the Irish economy was heading south, ports at the present time but the overall trend has construction was easing up and consumption was been positive if we take a longer period of time. As starting to show a diVerent pattern, but hopefully far as the marketing of the ports is concerned they are suYciently ahead of us that we will see them perhaps there is more that could be done with coming out of recession before Wales does so that the linkages with Europe, and part of the Wales Freight ports that are in that trade will see benefits sooner Strategy identified an understanding of what the rather than later. However, that is more of the same market is doing, particularly in terms of materials and it is trying to identify the new trades and the shift moving in and out of Wales and also materials in distribution patterns that lock in new activities, moving potentially through Wales, that could go to new flows and will bring benefits that are not the Midlands, along the M4 corridor and the South currently enjoyed by the Welsh ports. West. A greater understanding of that, of market intelligence and also some promotion of the Welsh ports in certain areas, particularly where they are Q31 Albert Owen: Waste management being one of aligned to taking flows oV the road in Europe and them and a new market. All Ireland’s waste goes out putting them on sea transport as opposed to hauling of Ireland, or the vast majority of it. them through Europe on trucks. We probably need Mr Couper: Yes. to raise the visibility in that way and that is something that was identified through the process Q32 Albert Owen: Do you think there is potential with the Wales Freight Strategy. there for Welsh ports in terms of new markets? Dr Beresford: Yes, why not? One very marginal Q29 Hywel Williams: You might have answered this example that I came across a couple of years ago was question obliquely already but thinking of the Irish exports of ATMs, which are flown to China. timescales for large scale infrastructure There is no real reason why they could not be land- developments at Welsh ports, it takes many, many routed to Heathrow and then flown. I did a quick, years and you referred earlier on, Dr Beresford, to not to say reasonably thorough, cost calculation on the decline in western ports of the United Kingdom this and worked out that it was about £500 more in the 1970s and 1980s and their resurgence in the expensive to fly-fly as opposed to road-sea-road-fly. 1980s and 1990s. It is a long term business and That road-sea-road would be business for Welsh possibly the recession will be gone—depending upon ports and Irish ports, so there is an interesting whom you believe—by the end of this year. Is there intermodal marginal example there of what is going the capacity to respond in the short term if we have on with things like ATMs going over to China for spare capacity should we need it, or are we going to recalibration and so on. be dependent on long term developments which might come about or not? Mr Couper: The answer is that in terms of capacity Q33 Mr David Jones: Dr Beresford, in your for existing traYc it can fluctuate through quite a submission to the Committee you have referred to wide band before you need to step up to add in more the potential for the ports to oVer value added resources, either built or human resources, but it will services and you referred specifically to the ABP be the longer term developments which carry the Connect initiative which they have established in greatest benefit for the ports and their regions. That four British ports, including CardiV, where you say is the new trade and the new slices of trade in that they have emphasised “cold chain logistics bringing containers and energy in particular; that is management”. Can you explain what that term where the benefits will arise for Wales and for the means? Processed: 29-10-2009 19:44:46 Page Layout: COENEW [O] PPSysB Job: 435922 Unit: PAG1

Welsh Affairs Committee: Evidence Ev 9

2 June 2009 Dr Anthony Beresford and Mr Callum Couper

Dr Beresford: Yes, temperature-controlled cargos Welsh port and the distribution facilities built on the that have to be kept in good condition throughout port estate; therefore the traditional value added bits the chain, the classic being food for retail. I would actually are done within the port estate giving new like to add, if I may take this opportunity, that ABP investment and employment in the port estate Connect has reduced its profile, we are on a because it was not there before, it was carried out downward slope as it were at the moment rather somewhere else, and the removal of one or two legs than an upward slope, but I wanted to include it in of the distribution chain potentially—certainly from the report. The fact of the matter is that it had been the deep sea port to the distribution centre in the first a new initiative in recent years, but it is probably fair place. These are port-centric logistics so we need an to say that it is not the highest profile part of ABP’s environmental eye on the benefits of doing that. business at the moment. Nonetheless the principles There are many other value added potentials with are correct in the report. steel coils, splitting steel coils or perhaps blending fertilisers or bagging materials. There is a whole host Q34 Mr David Jones: My next question was going to of things that could be done as close to the ship as be how successful has that initiative been in CardiV, possible so that you are reducing that onward and it sounds as if it has not been terribly successful. distribution leg, you are getting as close to the Dr Beresford: Short term reasonably successful, long finished product as possible. term a question mark. Dr Beresford: Timber products are another example. Mr Couper: Yes, we have had a recent investment at the port in CardiV where there is a timber company Q35 Mr David Jones: What opportunities exist for who are on the port estate and they are importing ports in Wales to provide other types of value timber in their own right now and it is going right added services? alongside the quayside; they are processing it and Dr Beresford: That is a very interesting question. that then gets sent to their customers. There is a very, very wide range of cargos and I would have to say that the cargo streams and types Q36 Mr David Jones: I understand that there is quite are the starting point. A lot of cargo you simply a new recycling facility in Newport. cannot do anything with at all and people do, as it Mr Couper: Yes. were, misuse the phrase “value added” in my view. Value addition in its pure sense and its most useful sense if you like is where the cargo changes its form, Q37 Mr David Jones: Which I suppose takes up Mr something is done with it—for example, radios are Owen’s point. put into cars or there is some pre-delivery inspection Mr Couper: Yes, that is the WEEE facility which is process or whatever. At the other end, at the very for the reprocessing of end-of-life electrical goods, simple end, a value addition is simply moving, where that is a recent investment there which is just going something obviously is worth more because it is live. closer to the customer, so depending on the cargo Mr David Jones: Thank you. there are the two types. If we are talking of repositioning cargo and getting it closer to a point of Q38 Mrs James: Turning to security and policing sale or point of use, then its value has gone up, but now you have already mentioned security but could not by much, it is kind of transport cost plus, but if you expand on what are the main security threats to there are cargos that we can identify that go through the operations of Welsh ports? CardiV or whichever South Wales port, or Mr Couper: Again I would suggest that I am more Holyhead, wherever it may be, which you can do involved in terms of freight than passengers in my something with and actually change the state and particular sphere, but clearly each port has a security form of the cargo, then that is potentially of interest. committee involving the local police, the special I agree with Callum on retail, such a wide range of branch of the local constabulary, immigration goods goes through the chains in retail—obviously authorities and the various community interests to not only food, people tend to think of retail ensure that where ships are coming into the ports straightaway as food, but we have got B&Q, we have there is accountability in terms of the cargo, the crew got toys, computer games, you name it—there are and potentially passengers. That has been enhanced opportunities for value addition but it depends on by the ISPS code, as I mentioned earlier. At the ferry where that happens in the supply chain and I think ports there is a higher level of supervision of security, an understanding of particular supply chains for but I am not really able to comment on particular cargos which are appropriate to Welsh ports is at the weaknesses or strengths really, it is outside of my core of it. Callum. field. Mr Couper: For example, if you look at the existing Dr Beresford: I would just add that I detect—and I model where there are deep sea containers, the sort think this is informal and anecdotal—a convergence of commodities that Anthony has referred to, they between passenger port attitudes and approaches to come into Felixstowe, they get road-hauled up to the terrorism threat and those we see at airports. I somewhere in the Midlands, the containers then get have seen ferry terminals which, frankly, if you are in stripped, they get put onto pallets or into boxes, them you would think you were in an airport. There cartons, whatever, they go up into racking is that tendency to move towards the airport—multi- warehouses, distribution warehouses, and then it layer security so to speak. I tend to be rather similar goes onto road and gets delivered, maybe all the way to Callum here, I am more of a freight specialist and into Wales. That really could be done through a the specific measures taken to ensure that freight is Processed: 29-10-2009 19:44:46 Page Layout: COENEW [E] PPSysB Job: 435922 Unit: PAG1

Ev 10 Welsh Affairs Committee: Evidence

2 June 2009 Dr Anthony Beresford and Mr Callum Couper safe and is not available as it were to bombings, the sea miles. I suppose there is a possibility of that terrorism, drugs, people traYcking and so on are for disadvantage that these people would be prepared a specialist in that area and I would find it very to risk. diYcult to give a professional answer. Q43 Albert Owen: The port owners and port Q39 Mrs James: My understanding is that there are operators are worried about the additional costs that two distinct areas to this, there is security in terms of they would have to put forward if the common travel threats of terrorism et cetera which obviously ports area disappears, and they actually then would have have to be prepared for, but if that did happen are to pass that on to the customer so it would become you confident that there are robust systems in place, less competitive. that there is a plan? Mr Couper: There would be additional costs and a Mr Couper: Each port has a port security plan that is penalty on the overall cost of getting from A to B approved by TRANSEC who are used by MCA and which would narrow the margin of advantage of one come and audit and approve the port security plan. port over another. At its basic level it involves establishing restricted zones where there is activity, for example, with Q44 Albert Owen: Is this something the Wales chemicals, fuels, dangerous cargos, passengers or Freight Group has discussed? roll-on-roll-oV facilities. They are fenced areas and Mr Couper: It is not, but I have seen it referred to a you can only get in and out of them with a security couple of times and it is something we could put on pass with your photograph and so on and so forth. the agenda. I would add that as far as the Wales There are checks at the gangway and, likewise, the Freight Group is concerned there is a meeting ship has got its own mirror responsibilities in that tomorrow in fact in CardiV of the Wales Ports they will have somebody at the head of the gangway Group, which is a sub-group of the Wales Freight who is checking anybody that is going on and oV the Group, and we will then bring into that the likes of ship if they are not part of the crew. There has been Stena and Milford and they will have useful things an increase in the quality of security at ports, to input on that because they are more passenger- certainly the cargo ports and specialist facility ports. focused than some of the other ports that are already Mrs James: Thank you. members. We will look out for that.

Q40 Albert Owen: I appreciate that you are not Q45 Mark Williams: Just to prolong this a little bit experts in security but we have the Borders, on security and policing, you have covered most Citizenship and Immigration Bill going through the areas that we had to question you on, but just House of Commons today and obviously a part of following on from what Mrs James said about the that is the common travel area. The fears in the robustness of the arrangements in terms of security, central corridor particularly that I represent, the are you satisfied that there is suYcient co-ordination port of Holyhead, are that a lot of traYc will be between port operators and those dealing with the going to the north of Ireland and from Irish ports to security, immigration and policing? You talked Scottish ports as opposed to Welsh ports. We saw in about the committees in place and the security plan the 1970s and 1980s with heightened security over that each port has, but is there room for the IRA threats that those ports were actually very improvement nonetheless? tight on security and people would come south of the Mr Couper: I suppose there always is and in security, border and use the central corridors. Do you see the in health and safety, in financial controls, in any reverse happening possibly if there is a tightening up dimension there will always be room for of security at the central corridors that will be to the improvement, but we rely greatly on our own detriment of Welsh ports and possibly allow cargo knowledge of our customers, of the activities on the operators and freight operators to use Scottish port estate, those that have got something to do with ports? what goes on on ships, those that are nothing to do Mr Couper: Because they are going within the UK with the port at all but just happen to be there as a across and use the border crossings? port tenant. Just the general management of the port estate gives us some pointers as to where we should be focusing our attention security-wise, but we also Q41 Albert Owen: Yes. have to rely on the likes of TRANSEC and their Mr Couper: I suppose there must be some potential occasional unannounced meetings where they test for that. actual security measures in place. CardiV Container Line, for example, is an ISPS facility in its own right V Q42 Albert Owen: You have a short sea crossing. with its own security plan within the Port of Cardi Mr Couper: The sensitivity is the cost. For freight and occasionally it does get tested and any they will be looking to use the most cost-eYcient shortcomings will then be very quickly brought to means depending where the origin of the cargo is, the attention of the port management. but going up to a Scottish port or north of the Mersey corridor, north of Fleetwood, Stranraer and Q46 Mark Williams: I am not after a list in pecking further north would add substantially to the road leg order of eVective ports but I would imagine it does which might alter the dynamic for drivers’ hours and give a competitive advantage. There are quality also the cost of road miles being more expensive than assurance issues that come into play in this as well, Processed: 29-10-2009 19:44:46 Page Layout: COENEW [O] PPSysB Job: 435922 Unit: PAG1

Welsh Affairs Committee: Evidence Ev 11

2 June 2009 Dr Anthony Beresford and Mr Callum Couper rather than simply complying with the regulatory Albert Owen: Thank you. requirement, so there is merit in you getting it right as well is there not? Mr Couper: Absolutely, it is in our interest as port Q47 Chairman: Thank you very much indeed for managers to know what is happening on our port your evidence today and also for the written estates and where our vulnerabilities are because evidence you supplied us with earlier which helped clearly that will impact on our business, never mind us a great deal in preparing for this session. the broader economic or social eVects of something Dr Beresford: Thank you, Chairman. going wrong. Mr Couper: Thank you. Processed: 29-10-2009 19:46:27 Page Layout: COENEW [SE] PPSysB Job: 435922 Unit: PAG2

Ev 12 Welsh Affairs Committee: Evidence

Tuesday 9 June 2009

Members present Dr Hywel Francis, in the Chair

Mrs Siaˆn C James Hywel Williams Mr David Jones Mark Williams Alun Michael

Witness: Mr Giovanni Mendola, Maritime Transport and Ports Policy, DG Tren, European Commission, gave evidence.

Q48 Chairman: Good morning. Bore da and Mr Mendola: This is something on which I could not welcome to the Welsh AVairs Committee and our give a reply since we have not especially addressed inquiry into ports in Wales. For the record, could ports in the Member States. We have rather you introduce yourself, please? presented the assessment of the Commission of ports Mr Mendola: Good morning, my name is Giovanni policy in general and left to Member States, on the Mendola. I am from the European Commission, basis of subsidiarity, all the decisions relating to port Directorate-General for Energy and Transport, development. In the Communication we do not find Maritime Transport and Ports Policy Unit, mainly a single model for the set-up of ports, for port in charge of internal market issues for maritime governance, or for port financing; this is entirely left transport and ports, and the legal framework for to Member States. State aid in maritime transport and ports. Q51 Alun Michael: I accept entirely the principle of Q49 Chairman: Thank you very much and thank subsidiarity but, at the same time, there is no point you for coming along. A particular big thank you for in having a European ports policy unless it is of V your memorandum which was very helpful in benefit to the ports in di erent states within the preparing for this session. Could I begin with a very European Union. You refer to the European straightforward question about the Commission’s Commission’s ports policy in your statement for us—please can you outline what the Commission’s view of the main opportunities for ports in the EU? policy objectives are for the EU’s ports in general, What do you think are the main opportunities and and what the action plan aims to achieve and by challenges for EU ports? when? Mr Mendola: The Commission adopted in 2007 a Mr Mendola: The general objective is allowing for broad policy Communication further to the two appropriate development, I would say, of ports. failed Directives for access to port services. After a Given their importance at the European level (and I large consultation of stakeholders the main will not repeat the usual arguments which are fully challenge for European ports generally speaking is true, but everybody knows the role of gateways to considered by the Communication as being Europe and the role for security of supplies in the development in full respect with environmental Member States) appropriate development as I said rules, on the one hand, and competition rules, on the before means reaching the necessary capacity while other hand. Another challenge, especially from our at the same time respecting a kind of balance across perspective, is the full application of the principles of Europe for traYc flows, without intervening in those the Treaty on the freedom to provide services and the traYc flows; again, this is left to the Member States. freedom of establishment to ports in the absence of Another objective, which is very specific to the secondary legislation, in the absence of a Directive. background of this Communication, the Generally speaking, ports are considered essential consultation and the two Directives, is social for the European economy—since maritime dialogue in ports. One of the reasons why the two transport, as such, is essential for the European Directives were not capable of being adopted was a economy. At the same time the Commission notices, very strong reaction by port workers. One of the especially on the Continent, there is quite a large objectives contained in the action plan is starting a imbalance in the use of ports with environmental European social dialogue in the technical meaning, consequences. Freight is often routed to ports which which is nevertheless not in the hands of the are very far away from the original destination. In Commission—it is up to certain partners to start the Communication the Commission does not social dialogue; to set up a level playing field for intend to take regulatory action in this field, but to competition between ports while respecting the use its own means, such as State aid policy or the views of the Member States of the role of ports and, revision of the TransEuropean networks, to address therefore, port financing. The item concerned is the this issue. Those are the basic messages from the adoption of the State aid guidelines which originally consultation and from the Communication. was foreseen, optimistically perhaps, for 2008—so we are late because the guidelines are not there; a set of guidelines on the interpretation of the Q50 Chairman: How well equipped are UK and environmental rules and their application to port Welsh ports for these challenges? development. One of the major worries of port Processed: 29-10-2009 19:46:27 Page Layout: COENEW [O] PPSysB Job: 435922 Unit: PAG2

Welsh Affairs Committee: Evidence Ev 13

9 June 2009 Mr Giovanni Mendola stakeholders during the consultation was about Mr Mendola: They have been, generally speaking, reconciling environmental regulation with port quite successful, even though the diVerent actions development; and we were asked on several which are included in the Marco Polo actions—the occasions during that consultation to give guidance ones which more directly relate to ports, the on the application of environmental rules. With this Motorways of the Sea action—today cannot be task we are a bit more advanced because a draft will considered as the most successful initiative. On the be ready during the next weeks to come, and possibly occasion of the last Marco Polo call in 2008 there a Communication providing such guidance could be was still no Motorways of the Sea action which was adopted before the end of the year. Again adopted, and there were very few proposals. In this concerning the level playing field, an initiative will be respect we tried to encourage Member States to act taken at the end of this year or early next year in this direction, first of all, by introducing more concerning the transparency of accounts between consistency between State aid rules and rules of EU public administrations and ports, possibly by means funding. One of the worries of the Member States of amending the current transparency Directives was that if they want to provide financial support to called the Transparency Directive. Finally, another projects and there is no EU funding available, or not initiative which is indicated in the action plan, but to the extent which is possible, they were not able to which the Commission will only favour but will not provide complementary State aid which is aid to be directly part of, is about a better integration of operational costs—so a very sensitive matter. For ports with their local communities, by means of this reason we aligned the threshold ceilings that can spreading best practices in this field; because there be used for complementary State aid by means of a are very diVerent practices and very diVerent Communication adopted at the very end of 2008; aptitudes across Europe about this subject. Last but and possibly this will encourage, and as far as we not least, in the Communication there is already a know it is encouraging, Member States to in turn first action which is accomplished there, which is the encourage initiatives for new Motorways of the Sea interpretation of the Treaty rules on freedom to projects; and there could be a couple of them in the provide services and freedom of establishment to current exercise, which is not yet finished. ports. This is an action that could have been carried out after the adoption of the ports policy Q54 Mrs James: We have taken previous evidence Communication, but interpretation and guidance from experts and operators referring to the fact that was already given in the Communication. Welsh ports struggle to access EU funds because programmes are not suited to smaller projects. We Q52 Alun Michael: You referred there to the do not have any public subsidies at all for the development of new operations or facilities; this is relationship between ports and their wider not the case in other EU countries. What eVect, do hinterland and the need for greater consistency in you believe, does the fact that UK ports are market- the way that that is dealt with. You have also got the led have on their ability to receive TEN-T funding? desire to balance the needs of the market with the Mr Mendola: I do not think that there is a direct link spatial planning objectives of national authorities. between the fact that ports are market-led and the To what extent can the existence of the action plan problem with the thresholds, because basically I influence that, particularly in influencing national understand there is a problem with the thresholds. authorities, given what you said earlier about the This is rather related to regulation, to the current subsidiarity that applies to most of the things that rules on TEN-T funding as they are, and there are would need to be done in order to deliver that greater three categories. In practice ports falling in the third consistency? category have more limited access, or no access in Mr Mendola: There is only a broad message, and this certain cases, to public funding. This is something was very much discussed with stakeholders during that could be addressed. To answer your question— the consultation because for many of them—and I do not see any relationship between the two. This ultimately Member States, because the Member is something that could possibly be addressed now in States were also consulted during this port policy the course of the consultation for the setting up of consultation—there was a great fear on the Member the revised TEN-T guidelines in 2010, which will also States’ side about a possible idea of a general aVect the framework for port funding. European master planning for ports, hinterland connections and traYc flows; but it is clearly stated in the Communication that this is not what the Q55 Mark Williams: Following on from points you Commission intends to do. The Commission in this made in answer to Mrs James, how is that process of context only recommends the Member States to take consultation going to work? There is the feeling that V into consideration the environmental dimension in smaller Welsh ports su er under the TEN-T their master planning, if they want to master plan programme because of the relatively short distances ports—because Member States are free to do or not for freight within the UK as opposed to other EU to do it. countries. I am interested in how that process of consultation is going to work and discussion of the guidelines. Could you tell me more about that, Q53 Mrs James: How successful have funding please? How the process of consultation is actually instruments such as the Marco Polo II programme going to work, so that those representations which been in shifting freight from road to short sea we heard about in evidence last week are going to be shipping and other modes of transport? made to the Commission? Processed: 29-10-2009 19:46:27 Page Layout: COENEW [E] PPSysB Job: 435922 Unit: PAG2

Ev 14 Welsh Affairs Committee: Evidence

9 June 2009 Mr Giovanni Mendola

Mr Mendola: I am not involved in the any likelihood at all that the Commission will be consultation—as you know, we are quite fragmented able to provide any financial mechanism to help in the Commission—so I cannot tell you at which develop cruise facilities? stage of the consultation my colleagues currently Mr Mendola: I do not know whether this would be are. The final result: a Green Paper was published, if mentioned in the study. It is not the first time here, in I am not mistaken—because, as I said, this is a bit my context, about the possibility of funding facilities outside my direct competences; but the final result of relating to cruises. You mean EU funding? the consultation should be a preliminary document in order to have new guidelines for TEN-T. I would Q58 Mr David Jones: Yes. like to add something to that. Here we are talking Mr Mendola: Honestly, I do not think that this about the funding of ports under TEN-T; so the 10% would be an item for EU funding, considering the of works and the 50% of studies. TEN-T funding is instruments as they are now which much more tend also available for the development of Motorways of to encourage modal shift or the development of the Sea. In a diVerent way, it is not State aid but it trans-European networks. This is something which is Community aid to infrastructure ancillary to the is really of a commercial nature, and which, in my development of Motorways of the Sea. Within a personal view, could hardly be funding by means of Motorways of the Sea project—and one could EU funding or even by State aid, except in very imagine a Motorways of the Sea project for your special circumstances, such as to outermost regions, region—ports could receive funding under the islands which are completely outside the natural current scheme for trans-European networks in the itinerary even of a cruise. way of funding to ancillary infrastructure to the Motorways of the Sea; not the 10%/50% standard Q59 Mr David Jones: So you would not regard Wales TEN-T funding. as an outermost region? Mr Mendola: It is not. The outermost regions are listed in Article 299 of the Treaty. Q56 Mr David Jones: Mr Mendola, you have Mr David Jones: That is encouraging! referred in your submission to the Committee about maritime tourism, which has been a major catalyst Q60 Hywel Williams: Good morning, Mr Mendola. for economic development in coastal areas; and you Could I ask you some questions about security. referred also to the study that the Commission has Firstly, what are the main obligations on EU ports in launched to “analyse the benefits for ports to invest respect of security legislation; and, secondly, how do in infrastructure”. I understand this study is to be you assess the security of Welsh ports in particular? published in September of this year. How do you Mr Mendola: There are two sets of obligations since anticipate this work will help encourage port there are two instruments. The older one is a operators to invest in the facilities required to regulation of 2003 which concerns security measures develop the cruise market? for specific facilities, like terminals, and the Mr Mendola: The study is not ready and again, measures were already conceived at an international unfortunately, it is a study about which I am aware level, the so-called ISPS code, and the regulation but it is followed in a diVerent context within the improves and makes mandatory recommendations Commission. It is part of this holistic approach of included in the Code. The second one is the more the Blue Paper on maritime policy, which is not only recent Directive which has a large scope of focussed on traditional maritime transport—which application and concerns the implementation of is what we mainly deal with in our Directorate, the security measures to the port area as a whole, and transport of freight—but of diVerent possibilities for implies that Member States establish a list of ports coastal regions. The market for cruises is one of these and fix the boundaries of those ports for the general possibilities; and possibly it could be at the origin of measures to be implemented. I will not comment interesting development, especially in certain areas about security measures in Wales. I know that there of the community where classic, so to say, transport is an ongoing (and I can say so because we are at the of freight is less important. What I can say about stage where it is no longer confidential) infringement investment—because it is much closer to my files, so procedure for non-communication of implementing to speak—is that investment in this field will be measures relating to the Directive by the United mainly private investment in facilities. The building Kingdom. This is rather at a general legislative level and the operation of a cruise terminal is the kind of than regarding implementing measures. I will not activity which has a commercial nature that we will comment about the level of security measures in possibly address in future guidelines of State aid to Wales. ports, to be adopted this year or next year. I cannot anticipate the result of the study on this. There is an Q61 Hywel Williams: There is a delay in transposing internal draft but I have not had the occasion to the Directive. What are the implications of that? read it. Mr Mendola: There are many infringement procedures over Europe—that is part of our job. The final stage is a judgment of the Court of Justice and Q57 Mr David Jones: I appreciate it is early days and possibly the application of penalties if that judgment the study is not published yet, but given that you is not obeyed by the Member States; but I am sure have just said you anticipate most of the investment that even before the judgment there would be in cruise facilities to be private investment, is there notification of the measure by the United Kingdom. Processed: 29-10-2009 19:46:27 Page Layout: COENEW [O] PPSysB Job: 435922 Unit: PAG2

Welsh Affairs Committee: Evidence Ev 15

9 June 2009 Mr Giovanni Mendola

Q62 Chairman: When we talk about “Motorways of level of the Member State according to the the Sea”, which is an interesting concept, and you framework which is used. Marco Polo is more for relate that specifically to the Celtic Sea, at what point undertakings; TEN-T is more for the Member would we be able to say that there would be States; and then the Commission makes an developments that would link those motorways to assessment and makes a choice on the project, in the Ireland and to Wales? case of Marco Polo; and leaves it to a committee Mr Mendola: The initiative to launch Motorways of composed of Member States in the case of TEN-Ts. the Sea is in the Marco Polo context up to the private Chairman: Thank you very much for your evidence undertakings backed by one or two Member States. today. It has been very refreshing to get a wider The Commission does not take initiatives in this European perspective. We tend to be a little too field. It gives money, so to say, and has fixed a introspective on some of our discussions. We look framework for launching new initiatives in this field; forward to sharing our report with you. If you feel but it is not up to the Commission to start the new there are some issues which we have not covered initiative. It is not bottom down, it is the other way adequately we would be very pleased to receive a round: it is a process which starts from the lower further memorandum from you. Thank you very level, from the level of undertakings, and then at the much.

Witnesses: Mr Robin Smith, Welsh Representative, Rail Freight Group; Mr Christopher Snelling, Head of Rail Freight and Global Supply Chain Policy and Mr Stephen Kelly, Head of Policy Midlands, Wales and South West, Freight Transport Association; and Mr Michael Farmer, Regional Director, Road Haulage Association, gave evidence.

Q63 Chairman: Good morning and welcome to the shipment coming into Fishguard does not Welsh AVairs Committee. Please do not be afraid to necessarily stop at Newport, it will go beyond into raise your voices as there are very poor acoustics in England and beyond into Europe as well. The thing this room. For the record, could you introduce we want to flag up is that we do have concerns that yourselves, please? delivering a sustainable transport strategy, whilst it Mr Kelly: My name is Stephen Kelly. I am Head of is to be applauded, is only looking at England Policy for Wales, Midlands and the South West necessarily and is not focussed upon Wales. representing the Freight Transport Association. Mr Snelling: Christopher Snelling, also from the Q65 Chairman: That is what you would call Anglo- Freight Transport Association. I am Head of Rail centric, I suppose? Freight and Global Supply Chain Policy. Mr Kelly: It could well be. Mr Farmer: Mike Farmer with the Road Haulage Mr Farmer: I agree with what Stephen has said. Association. I look after Wales, the West Midlands There needs to be much more linkage; but I would and the Southwest. add a further factor: there needs to be also greater Mr Smith: Robin Smith. I am the Welsh linkage at local level and local authority level as well, Representative for the Rail Freight Group. because that is a major building block of the development of ports et cetera. Q64 Chairman: Could I ask a very straightforward but rather broad question to begin with. Could you Q66 Mrs James: Just to tease out a little bit more comment on the eVectiveness of UK Government about that, what impact has the Department for and Welsh Assembly Government in working Transport’s ports policy, which appears to be letting together coordinating policy, particularly with the market decide where ports-related developments regard to ports policy and also, more widely, should happen, had on the movement of freight transport policy and its framework? through Welsh ports? Mr Kelly: I think we have mentioned in the past that Mr Snelling: I think the market-led approach has led coordination and communication could be to the greatest eYciency in the way that freight improved between central government here in moves: particularly when we are looking at deep-sea Westminster and the Welsh Assembly Government intercontinental deliveries, they all want to come to down in CardiV. As an example of that, some of the a certain location and there is actually a limited work that we have done as the FTA has looked at amount that government can do to prescribe them to Delivering a Sustainable Transport Strategy, the come to a diVerent area. I think working with the recent publication looking at transport 2014 and market is the best way to get eYciencies out of ports. beyond; and, when you look at what they have I think what you would need to do in working with identified in terms of strategic national corridors, it those market conditions is to work to the strengths seems to stop at the border. Obviously that strategy and to try to accentuate those. is not focussed on cross-border issues, which is an inquiry that this previous Committee held as well and something that we raised as a concern. In Q67 Mrs James: What balance do you think is essence, there does need to be more communication needed between private and public sector especially on transport issues, because as far as involvement for port development or in developing freight is concerned it does not know borders; a ports? Processed: 29-10-2009 19:46:27 Page Layout: COENEW [E] PPSysB Job: 435922 Unit: PAG2

Ev 16 Welsh Affairs Committee: Evidence

9 June 2009 Mr Robin Smith, Mr Christopher Snelling, Mr Stephen Kelly and Mr Michael Farmer

Mr Snelling: I think developments need to be private react quicker than seems to be the case at the sector led as they will, through market forces, be the moment. I would certainly go on to support the best judge of where the traYc is going to be for the comments regarding loading gauge issues. If you greatest eYciency of the economy, which depends on look in the freight utilisation strategy, as published good flows to ports. We also expect that private by Network Rail, the network within South Wales developers should be responsible for the cost of and North Wales to Holyhead are fairly restricted at developing those ports. They are private facilities the moment and there are no plans, certainly in the which can make money; and they should be next five-year period, to enhance that loading gauge, responsible for doing that. Where we would like to which will constrain port development, particularly see the public sector come in is really in two places: for containers. one is in a planning framework which enables the Y e cient development of ports—and by that we do Q69 Mr David Jones: You mentioned the not necessarily mean a planning system that says yes importance of adequate road infrastructure at ports; more often, but a planning system that gives a yes or and you also mentioned earlier that you had a no more quickly and with less expense, so that concerns about the lack of coordination of transport generally the development of ports can be planned policy between the Welsh Assembly Government Y more e ciently; and the second thing we would like and the Department of Transport. To what extent is to see from the public sector is greater support for the fact that ports are not devolved and road development of inland infrastructure connections, infrastructure is devolved a complicating factor in rail and road links. The guidelines that have been your opinion? outlined by DfT are perfectly reasonable. What they Mr Kelly: I suppose it is a Catch 22 scenario more stand or fall on is how much money the Government than anything, in that the Scottish Executive and actually puts behind it. We would like to see a lot Northern Ireland do have responsibility for their more money put behind it, because certainly what we ports; whereas the Welsh Assembly Government see is the ports in the UK are severely disadvantaged does not, basically. I suppose the fact that the Welsh because their rival ports on the Continent get all ports are policy-led by DfT eVectively whereas these links provided for free, as well as being given Welsh roads are policy-led by the Welsh Assembly money to carry out development as well. Government in terms of their trunk road forward programme, one would have to question if there is Q68 Mrs James: Really it is the transfer of goods any cohesiveness there more than anything. The from the port on to the next stage of its journey, and Welsh Assembly Government will have their obviously I am very interested in rail access to the forward programme in terms of road improvements V mainline et cetera, which is essential; those improved for the next 10 years e ectively and, if the plan is for facilities at dockside, in eVect? the DfT to support Welsh ports, does that fit in with Mr Kelly: Yes, I think so. I think where Welsh ports the Welsh Assembly Government policy in terms of suVer is that they are not rail-linked to a certain their forward programme and access to these ports V extent, or to any extent as a matter of fact, and that e ectively? is due to the rail infrastructure itself in terms of the loading gauge requirements. For example, in terms Q70 Mr David Jones: Am I to infer from your of some of the bigger sized containers, rail in Wales answer that you regard it as a complicating factor? is not equipped for that. That has been highlighted Mr Kelly: I think it is complicating this. We do not in the rail utilisation strategy for Wales. particularly have a view as to whether Welsh ports Mr Snelling: Just to make that point about port policy should be devolved to the Welsh Assembly development—if you as the public sector improve Government. road and rail links, that improves the prospects of the port and the return developers would get on their Q71 Mr David Jones: No, I was not asking you that. money. That does not mean that they, therefore, just What I was interested in was the practical make lots of extra profit to their own advantage. consequence of this? What tends to happen is it means they expand the Mr Kelly: Yes, I think it is a concern, in that left arm port more because they can attract more business and right arm are not working in coordination with because the business case for those companies is so each other. much the better. Obviously the infrastructure connections you are looking at have got to be suitable for the kind of traYc that the port can Q72 Mr David Jones: Your answer again appears to potentially attract. me to underline the point that it is necessary for the Mr Smith: I would like to speak from a rail freight DfT and the Welsh Assembly Government to act point of view. We also would support a market-led more in concert in the development of road freight system, rather than a prescriptive system from policy? central government. We would fully support what Mr Kelly: I just think it is essential. our FTA colleagues have just said regarding the fact that government can provide a framework within Q73 Alun Michael: Could I just be clear on that final which development can take place, because trade is point, because I think answers to questions are international and trade patterns can change. sometimes open to misinterpretation. Are you Therefore I think ports and their infrastructure and identifying a lack of cooperation and cohesion their hinterland infrastructure need also to be able to between the Welsh Assembly Government and the Processed: 29-10-2009 19:46:27 Page Layout: COENEW [O] PPSysB Job: 435922 Unit: PAG2

Welsh Affairs Committee: Evidence Ev 17

9 June 2009 Mr Robin Smith, Mr Christopher Snelling, Mr Stephen Kelly and Mr Michael Farmer

Department for Transport; or are you saying the fact of our diVerent ports in Wales, and presumably also that it is two diVerent bodies might lead to a lack of the degree to which individual ports have a coordination? potential? Mr Kelly: I think there is more of a need for better Mr Snelling: Yes, absolutely, and the growth communication between the two parties. potential for diVerent ports will vary completely depending on what kind of business it is that they are into. You have to take each kind of trade, each kind Q74 Alun Michael: We understand the need; I am of commodity on its own merits and assess it in asking you whether you were identifying actual that fashion. problems, or merely stating that problems might arise from the fact that it is two separate bodies? If it is the former it would be helpful to the Committee if Q77 Alun Michael: Again, perhaps if it is more detail you were to identify what those are; and if it is more than could be given in a simple answer, to what detail than can be done in a single sentence perhaps extent are you able to outline what you see as the you could provide us with some supplementary growth potential of diVerent types of freight and in evidence? relation to diVerent ports around Wales? Mr Kelly: I can take that away, yes. Mr Snelling: In diVerent areas for freight movements Mr Farmer: Perhaps I might comment on that. there is a lot of demand forecasting that has been Clearly there is a disconnect there; and I suspect it is done. We could certainly look into what is available more of a perception rather than a reality. I would on that and supply the Committee with any expect there to be very good linkage between the information. Welsh Assembly Government and the DfT. I would think that commonsense ought to prevail with regard to the importance of the ports to Wales, and Q78 Alun Michael: I think that would help to make thus the importance of the road links, and indeed rail sense of the general replies for us. Another question links, to those ports. I suspect it is perception but really is how decisions get taken. How do freight from a business point of view it does not make sense forwarders and shippers decide which UK ports to to have separately devolved areas. use; and what potential is there for Wales to improve its attractiveness? Mr Snelling: For a freight forwarder particularly to Q75 Alun Michael: There obviously are decisions make a decision, as it will typically be the freight taken by local authorities in relation to ports, and forwarder making a decision about which port to the relationships with the wider environment by the use, the main factors will be its connectivity towards Welsh Assembly Government and by the the next destination. If we assume that something is Department for Transport. I think quite a big ask in arriving at a Welsh port to go to a further destination terms of some other developments leads us to ask the somewhere inland within the UK, it will be about the question: what is the potential for moving greater relative connection times of the ports on oVer; a volumes of freight through Welsh ports? Would that further factor would be the cost of using that port; justify, for instance, the change in the rail ports have diVerent charges depending on how they infrastructure which would be quite a significant are operated and how they are set- up; and a third investment? What is the potential in this factor would be the eYciency of that port, which marketplace that you have described for growth in could mean not only the speed that you get through, volumes of business in Welsh ports? but also its reliability. Frequently when UK ports get Mr Snelling: I would say that there is the congested, the same with other bits of the transport opportunity for what you might describe as “healthy network, as soon as you have a small problem growth”, but I would contrast that, for example, everything can grind to a halt. Those would be the with the container ports in the Southeast of England, generic factors that would drive a decision. I think where the kind of potential we are looking at is the most important one of those is the linkage to its talking about doubling capacity. I do not think there onward destination. There is no point arriving, is necessarily a potential in the short-term of that getting something unloaded very eYciently in a port kind of order in the Welsh ports; as we are looking at if it is then going to be a long, unreliable journey to greater use of the Irish Sea trade and expanding get on to the West Midlands or the north of some of those ro-ro services, rather than the massive Scotland; people will simply look for alternatives. deep-sea container movements that you would see at Mr Smith: I would support the three that those kinds of points. There is the potential for Christopher has actually advanced as key criteria. growth but, you are right, before any money is spent The other one that I would add in is the general or any decisions are made about how things should patterns of trade. At the moment they are well set, be administered, you have got to do adequate and most of the forecasting that has been done by the demand forecasting to estimate exactly what those Rail Freight Group and the Freight Transport possibilities are. Association is based around no significant change in shipping routes away from the Southeast; but there Q76 Alun Michael: To what extent are you able to are potential developments on the Tees at Liverpool make that sort of forecast in relation to what is quite and at Bristol, all of which could have some eVect on a varied number of ports? There are big diVerences, patterns of trade. Unless and until we know the are there not, between the nature and the strengths extent and the success of those developments it Processed: 29-10-2009 19:46:27 Page Layout: COENEW [E] PPSysB Job: 435922 Unit: PAG2

Ev 18 Welsh Affairs Committee: Evidence

9 June 2009 Mr Robin Smith, Mr Christopher Snelling, Mr Stephen Kelly and Mr Michael Farmer would be very diYcult to give other than broad- has been done between Felixstowe and the Midlands brush figures, I believe, for future patterns of trade et cetera. It is on the basis of those forecasts, which that would underpin significant developments. have been in the public domain for a long time and are seen to be robust, that people like Network Rail Q79 Alun Michael: I suppose the question is really to are making significant investments. what extent Welsh ports are currently meeting the needs of the freight transport industry; how are they Q82 Mark Williams: Put that into a Welsh context. doing, against the triggers for decision-making that You have talked of English examples there. you have referred to; how do they need to adapt for Mr Smith: At the moment, because of the patterns the future; and will they be able to adapt; have they of international trade, it is not seen that there are got the capacity to adapt at the rate that is needed to increase their market share? likely to be any significant increases in demands Mr Kelly: From an FTA members’ perspective we within South Wales or North Wales ports. Growth, have not had any feedback to say there are problems yes—I think the word Christopher used was at Welsh ports at the moment in terms of standing “growth”—but not significant changes in patterns. times on docks et cetera. Just to echo what my colleague said, I think there is quite a lot more Q83 Hywel Williams: I think there is something of a capacity at ports at present before they reach that theme in some of your answers about the split saturation point more than anything. With that between the Assembly’s responsibility and extra capacity there, I would not foresee the need to Westminster’s responsibility about who is change anything drastically at the moment. Once responsible for roads, about the spare capacity that you start reaching that saturation point you need to is already available in ports. Can I just ask you the look at access to ports, you need to look at rail plain question: are the existing road and rail links interchanges and so on and so forth. At present I putting Welsh ports at a disadvantage, aVecting their have not heard from major members of the FTA— competitiveness and so on? like the Association of British Ports themselves who Mr Farmer: I think they have to be a large factor. operate ports down in South Wales—that they are The two specific ones—the A55 North Wales, good crying out for more traYc at the moment. I think the dual carriageway but it is let down by having a extra capacity is there, and at present the size of the bottleneck right at the end into the port. The bulk of ports is adequate I would assume. the journey fine; the last mile congested. The A40 Fishguard; the A477 Pembroke: the A40 is still a Q80 Mark Williams: This question is to Mr Smith. single carriageway road heading for a port which is In your memorandum in the section on demand a ro-ro port which develops a lot of lorry traYc. I forecasting you seemed critical of the Department think that is a distinct disadvantage. Obviously, for Transport and their projections. You talked Wales being on the periphery, the ports being on the about “some consideration of scenarios with periphery of Wales, you need those road links; and increases in transhipment, but little consideration of that, for us, is the limiting factor for a number of scenarios where ports in other areas increase in ports. relative significance”. What did you mean by that? Mr Snelling: The right way to look at it is the quality Mr Smith: I have just borne that out in the previous answer I have given to Alun Michael. All the current of the inland infrastructure, those connections, is not forecasting, both from the Department and from the a kind of black and white issue where once you reach industry, is based on no significant change in trade a point where it is good enough then it ceases to be patterns. It is based on growth in trade, as a factor. It is a scale whereby the better the links are Christopher has just talked about, significant the more competitive the port is. If you make the growth through the Thames, Felixstowe and links amazingly wonderful then the port will become Southampton but not necessarily on a change in even more competitive. It is quite a moveable feast shipping patterns. We are not criticising the in that sense. You would certainly increase the Department; that was made as a statement of fact competitiveness of Welsh ports if the links to them reflecting the current situation, that there is no were improved. You cannot ignore the road links in perceived significant change happening or likely to that, given the kind of trade that is going to come happen. into ro-ro and ferry ports particularly. Mr Smith: Of the ports that are currently rail- V Q81 Mark Williams: It may be a statement but it is linked—Newport and Cardi are operational; nonetheless pretty serious, is it not? To what extent Swansea has a link that is not used at the moment; do those forecasts, skewed as they are, limit the the Port Talbot Harbour has links through the Corus freight transport sector? How much credence do we site et cetera—the rail links are there; but we touched put on those forecasts? on earlier that the loading gauge would be an issue Mr Smith: The forecast from the Department and if the traYc were to be containers. The tracks are the joint forecast from the FTA and the Rail Freight generally able to support the heaviest wagons but Group have been used by Network Rail in particular not the biggest wagons. Yes, again, it is a little bit of a to underpin their freight utilisation strategy and chicken and egg. Improved links would improve the their regional utilisation strategies, which is why we competitiveness of the ports but the question mark are engaged in work like gauge enhancement is that, unless trade patterns change, how much use between Southampton and the Midlands; why work would be made of those links? Processed: 29-10-2009 19:46:27 Page Layout: COENEW [O] PPSysB Job: 435922 Unit: PAG2

Welsh Affairs Committee: Evidence Ev 19

9 June 2009 Mr Robin Smith, Mr Christopher Snelling, Mr Stephen Kelly and Mr Michael Farmer

Q84 Mrs James: Just to go slightly oV on a tangent Q86 Mr David Jones: Pausing briefly there, on the from that—I am very aware in Swansea in particular Continent the Government pays for all the links? of the competing need for the land around the ports. Mr Snelling: Yes. They frequently pay for the We are seeing more and more development on port development of the ports as well. Yes, it would be land; we are seeing more and more housing; and 100% of the links. There is the example even where there is a huge capacity there. What is your opinion the Dutch Government has paid to upgrade railways of these competing needs for the land? I feel strongly in Germany because they are of benefit to Dutch that we need to preserve for the land or dock activity ports. That is simply how it is operating on the but it is not very popular in my constituency; they Continent, and it is not a model that we have would like houses on it, please. followed here, which is a shame and has led to Mr Farmer: I think any port with a developed British ports being less competitive compared to hinterland has got to be of benefit to the local Continental ones. Given that—if we work within a community, because an active thriving port will context that Government policy is that developers actually generate local business. It is always going to have to pay a contribution, the guidelines themselves be this clash between the economy and the and the way they are worked seem fine; but the key community. I do not think there is any set answer, issue is, how much is the Government actually going but this comes back to a point I made right at the to put into this fund to provide its share? Essentially beginning that local authority planning and such what the guidelines set out is an order of priorities like I think has a major part to play in this. It is one for how the Government should spend its money. If of the things that we would like to see, more landside it only puts £2.50 into that pot then the fact that they development. One particular point I made in our have set out nice and clearly what their priorities are memorandum was facilities for HGV drivers. At the does not really help if there is no money to spend; moment they are parking in public car parks with no that would hinder port development. If there is facilities or anything down at Fishguard and up in generous funding of it then the guidelines can work Holyhead, and it is criminal that we each rely on and the developers can get a contribution each other but there is no ability at the moment or commensurate to the public benefit from those same desire to put facilities for the drivers at the ports. infrastructure upgrades. That is one use that could be made of this land and, again, it could generate business: lorry drivers have to eat et cetera, so I think it could all work together Q87 Mr David Jones: Clearly to that extent you quite well. As you say, the perception is sometimes would need fairly close liaison between the port not the reality. developers and the Government to ensure that the Mr Smith: Could I add to that that other ports forward budget is available for the infrastructure around the country are developing a concept; one in funding? particular (I do not think it is copyright) is called Mr Snelling: That is one of the many imponderables PortCentric Logistics, which is where people like that port developers have to face, in that they know Tescos are encouraged to put distribution centres on what the guidelines are but they have no idea what port estates, partly so the goods can be imported kind of funding is behind it. Obviously governments through that port but partly also to generate set their budget each year and that is just a fact of employment in the area. Such developments on a life, but that does mean you cannot plan five years port estate in Swansea, for example, even if they are ahead and know that by applying this formula we not totally export or import related, might be the key know we will get government funding, because the to generating improved rail links. The port estate Government could simply turn round and say, can become the catalyst, rather than just pure import “We’ve run out of money this year, you’ll have to and export activities over the quayside. wait for around five years’ time before you can get that funding”.

Q85 Mr David Jones: Pursuing the theme of links, do you agree with the Government’s guidelines on Q88 Mr David Jones: How could the present system developing links to port, that is the developer should be improved? pay the cost; and, if not, what alternatives would you Mr Snelling: I think it is about political will and the put forward? commitment actually from all sides in politics that Mr Snelling: I think for the development of this is an important issue which would require infrastructure connected to a port to link it the funding. Obviously in the current financial climate guidelines that were set out by DfT as to how this is a diYcult time, but the more that there is seen developer contributions should be assessed and how, to be a political will behind that, and therefore a alongside that obviously,Government contributions likelihood of reasonable funding, then the more should be assessed, we do not have a problem with surety that developers have and the more confidence the guidelines themselves; they seem like a they will have, and the more likely it is that the UK reasonable way of making that assessment. will get the inward investment of developers’ money. Obviously ideally we would like the Government to You have to remember these developers are always pay for everything on the grounds that that gives us multinational companies who are choosing where in a more level playing field with the Continent, except the world to invest in ports. It is a question of where that we are not quite there. they will get the best return that will get their money. Processed: 29-10-2009 19:46:27 Page Layout: COENEW [E] PPSysB Job: 435922 Unit: PAG2

Ev 20 Welsh Affairs Committee: Evidence

9 June 2009 Mr Robin Smith, Mr Christopher Snelling, Mr Stephen Kelly and Mr Michael Farmer

Q89 Mr David Jones: Give that, to what extent are artic is coming in at £75,000-£80,000, a load of a local authorities in your experience giving quarter of a million on the back; we are talking consideration to the needs of ports and their serious money here which needs to be secured—let development in developing their local plans, alone, obviously the anti-terrorist security et cetera specifically in a Welsh context? which has to prevail at the docks. The other issue, as Mr Kelly: I think that is where the regional consortia I have already mentioned, is the parking facilities for have a role to play. Obviously we have the four lorries. At the moment, if they are early, late or regional consortia in Wales. We have obviously having to wait because the ship coming in is delayed, produced the Wales Freight Strategy last year and essentially they are outside the docks; they are on are looking to take that forward and deliver the their own; there is nobody there to help them, to look action plan that is against it; but a lot of those after them, to oVer them parking spaces. actions are against the regional consortia. Once again, it is all subject to funding eVectively, and whether the Welsh Assembly Government is willing Q94 Mr David Jones: Is there not a wider issue there to put up funding for any developments or provide too, for example on the A55 where I believe there are the funding for the regional consortia to take no truck stops at all? forward. Mr Farmer: There is the odd one. There is a small truck stop on one of the junctions of the A55. I think that brings us into another realm, and how long have Q90 Hywel Williams: Given that we are talking you got if you are going to starting talking about about money, are there any ballpark figures for any motorway service areas and truck stops. It is of this? Is anybody saying, give it to individual ports probably not directly relevant. in Wales, or to Wales in general? How much would any particular improvements to road or rail actually cost? Q95 Mr David Jones: At the very end of the A55 is Mr Kelly: Millions! the Port of Holyhead; this must surely be a Mr Farmer: A lot! significant concern of yours, given that most of the lorries going along the A55 I guess ultimately will Q91 Mr David Jones: Mr Farmer, you have raised end up in the port? concerns about the risks that face hauliers when they Mr Farmer: Absolutely. The problem we have is this leave their loads at ports for significant periods of perception again, frankly,nobody wants a lorry park time. How would you like that issue to be addressed, in their backyard. We see this time and time again. I and by whom? am sorry to bring it back but this comes back to the Mr Farmer: We believe this to be incumbent upon local authority planning. If the local authority will the port operators. They rely on the lorries and the not oVer planning permission, or what have you, we rail—I am not being diVerential there but obviously are on a hiding to nothing because if you mention I am focussed on the road side—to bring the goods lorry park to the general population they start into and out of the port. Talking to one of our running for cover. members the other day at CardiV, his operating centre is leased from the docks people but he is not Q96 Mr David Jones: Ought this not be something included in the dock security. They will not put the that the relevant local authorities incorporate in perimeter to include his premises, where he has got a their local development plans? lot of lorries parked with loads et cetera. I think that is the responsibility of the port operators, to be Mr Farmer: I believe it should be. The Welsh inclusive with regards to looking after, in a sense, the Assembly Government, and DfT for that matter, suppliers to that port. That is the security side. That should be cognisant of the fact so that they can is one example, but I hear of other ones from other factor it in to all their discussions. places as well. Q97 Mr David Jones: Is this a matter that you are Q92 Mr David Jones: Just pausing briefly there, why raising with local authorities, because they are now do ports not provide that level of security? of course developing their local development plans? Mr Farmer: I cannot prove it but I think this is down Mr Farmer: Yes we are and, as I say, truck stops is to cost. A lot of port land, as I understand it, is leased not a word that goes down well when you start to other businesses. There was just this one example, talking to local authorities, sadly. because obviously we were talking to our members Mr Kelly: I would echo Mike’s comments there in in preparation for this, and he made this specific that there are some basic facilities along the A55 but point: “I lease the land; I operate part of the docks; when we say basic we are talking about lay-bys but I am exclusive to the dock perimeter and the eVectively more than anything. There is no dedicated dock security”. lorry parking facility. Obviously we were hit with the bad news a couple of months ago about the initiative Q93 Mr David Jones: Surely arrangements could be to set up a lorry park/truck stop which was denied by made through the leasing agreements for a Flintshire County Council, I believe. I would go one contribution, for example? further from what Mike said in that when you are Mr Farmer: It would appear not. That is just one looking at new industrial developments and new specific example. I think security is a major issue industrial estates, et cetera, part of the planning because not just the cost of the lorries, the average procedures should be an inbuilt lorry parking facility Processed: 29-10-2009 19:46:27 Page Layout: COENEW [O] PPSysB Job: 435922 Unit: PAG2

Welsh Affairs Committee: Evidence Ev 21

9 June 2009 Mr Robin Smith, Mr Christopher Snelling, Mr Stephen Kelly and Mr Michael Farmer in that, and that would mean section 106 Chairman: Thank you very much for your evidence agreements, et cetera, so there is a need to look at it this morning and also for the memoranda that you from a national planning legislative perspective but have provided. The memoranda have been very also the local authorities have a duty, I think, in helpful in preparing for this session. As I say to all terms of road safety more than anything just to witnesses, if you feel that you have not covered all provide basic lorry facilities so that drivers are not the points then we would be very pleased to receive abusing their hours regulations and so on and so any additional memoranda in future. Thank you forth. very much. Processed: 29-10-2009 19:48:10 Page Layout: COENEW [SE] PPSysB Job: 435922 Unit: PAG3

Ev 22 Welsh Affairs Committee: Evidence

Tuesday 23 June 2009

Members present Dr Hywel Francis, in the Chair

Mr David Jones Hywel Williams Alun Michael Mark Williams Albert Owen

Witnesses: Mr Matthew Kennerley, Port Director, South Wales Ports, Associated British Ports, Mr David Whitehead, Director, British Ports Association and Mr Ted Sangster, Chief Executive, Milford Haven Port Authority, gave evidence.

Q98 Chairman: Good morning and welcome to the provide value to them as well; so it is a two-way Welsh AVairs Committee. For the record could you process that we have to balance and manage at the introduce yourselves, please? moment. Mr Sangster: Ted Sangster, Chief Executive, Milford Haven Port Authority. Q100 Mr David Jones: The Committee has had Mr Whitehead: I am David Whitehead, Director of evidence previously about the importance of the British Ports Association. planning side infrastructure to ports and of course Mr Kennerley: I am Matthew Kennerley; I am the roads are a devolved issue in Wales. To what extent Port Director for ABP, South Wales Ports, so are you finding that there is coordination in policy CardiV, Barry, Newport, Port Talbot and Swansea. between the Department for Transport, which is responsibility for ports, and the Welsh Assembly Government which is responsible for roads, in connection with the development of ports in Wales? Q99 Chairman: Could I begin by asking a pretty Mr Whitehead: I will start. Just taking strategic straightforward question. Obviously ports policy is national corridors, for example, which have been a reserved matter whilst many of the relevant identified in England, the map suddenly disappears economic and transport policy areas are actually V when you get to Wales. We have been told that there devolved. How does this a ect the development of will be a similar consultation for Wales fairly soon— Welsh ports? we have not seen it yet—so we assume the links Mr Whitehead: I will start on that, Chairman. I think will come. it is a complicated picture in terms of policy for Wales. Basically the overall policy is driven from London; we have an English and Welsh ports’ policy. Q101 Mr David Jones: We will be touching on that Some parts of the licensing regime are operated from later, by the way. CardiV. Harbour Revision Orders, which are a very Mr Whitehead: You are absolutely right. Ports, quite frankly, are only as good as their infrastructure important part of development and licensing, are connections. We have a TENs route identified in the operated from London; so there are a few grey areas north, not yet completed but at least identified—and here and potential for confusion. If you look at the my colleagues will come in—but certainly the figures, Wales handles about 10% of the total UK southern route really suVers from lack of investment throughput; England handles 400 million tonnes—I there. It is not just Wales. We talked about cannot give you the percentage, but a very high integration of policy; the problem that ports have is percentage—so inevitably there could be a tendency that because they are not a part of public spending towards a concentration of English issues. And if they are essentially private sector. They are always a you take Harbour Revision Orders there is a very little bit at the margins when big decisions are made small team in London dealing with those, so about transport spending and getting them to the resources is a big issue as well. forefront and getting them round the table when the Mr Sangster: Just a comment to add on to David’s. big decisions are made is one of the big issues for us. Ports operate in a UK market—in fact a European Mr Kennerley: Just speaking on behalf of the ports and global market—and as such require recognition that we operate in South Wales, road connectivity and support that takes that into account. There is has improved over the years in specific areas: for some benefit in being part of a UK responsibility example, the southern distributor road around from that point of view but it does require, as David Newport enables good access on to the motorway has touched upon, an understanding for the Welsh system. The one area that requires continual work is Assembly Government of the value and importance the M4 and that provides linkage right through to of ports in Wales in delivering to the Wales priority the western most ports in Wales. There is a process and the Wales economy as well. So as ports we have ongoing at the moment for a new M4 route and we to balance that relationship between our encourage improvements on the M4 but that has to accountability and responsibility in dealing with the be balanced in terms of its negative impact on the UK Government, whilst also keeping the Welsh port and at the moment that M4 route is currently Assembly Government informed and working with crossing the centre of Newport Dock, which them on those issues that are devolved and also obviously presents a number of operational Processed: 29-10-2009 19:48:10 Page Layout: COENEW [O] PPSysB Job: 435922 Unit: PAG3

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23 June 2009 Mr Matthew Kennerley, Mr David Whitehead and Mr Ted Sangster commercial challenges. So it is having the right if it is fully devolved it would need to be properly balance in terms of proper solutions and making coordinated with what is going on in the UK as a sure that road development does not accidentally whole. hinder port development at the same time. Mr Sangster: UK ports fully support the Marine Bill and the principles behind it—the application of spatial planning to the coastal environment—and Q102 Mr David Jones: I can see the problem. What there is a very real opportunity being presented for a I wonder is whether it is being addressed in a simplification, as you touched upon, and bringing all coordinated manner between national government the consent processes into one well resourced and and the Welsh Assembly Government. specialist body to do that. Wales is perhaps not Mr Sangster: If I may just comment on that? Just taking full advantage of that and therefore Welsh building on what Matthew has said regarding the ports are going to be not as advantaged as other M4 corridor being of advantage to ports in South Wales, if you look further west at the ports at ports in the UK because we will still have devolved responsibilities—and it looks as though we are going Fishguard, Milford Haven and Pembroke Dock, V whilst that route is identified as part of the TENs to be looking to Cardi ; and for non-devolved network, so it has European acknowledgement of responsibilities to the MMO. I fully understand and the strategic value of the route and UK support and support the need behind the principle of things in Welsh Assembly Government for that, where there is Wales need to be managed in Wales, but we have a failure is in delivering to that in the particular been urging the Welsh Assembly Government to context of the failure of the Welsh Assembly take the pragmatic view of perhaps engaging with Government to fulfil the expectations and the needs the MMO to make use of the high level of skills and of the Pembrokeshire economy in those ports in resources that will be put in there for the MMO, to dualling the A40 beyond St. Clare’s, which is a act on behalf of Wales to not put Welsh ports at a significant dampener on potential investment disadvantage in having to go to two diVerent opportunities in west Wales and the use of those organisations or parts of the country for their ports and a detractor from the use of the ports and processes. the traYc making use of those ports.

Q105 Alun Michael: Just in parenthesis I am inclined Q103 Albert Owen: Mr Whitehead, you have to observe that the activity and the economic mentioned the licensing arrangements and you are importance of the ports in some cases, particularly aware that the Marine Bill is going through the case in CardiV, is dramatically greater than it was Parliament today and that a new body is going to be 25 years ago, and perhaps this report might highlight set up. Do you have concerns that certain measures that and any evidence that you would like to give us that will be devolved under the Marine Bill will go to that would assess that would be useful. I just wanted the Assembly and that you will still be dealing with to touch on two questions in relation to two separate departments and there might be some competitiveness. Witnesses have said to us that the gold plating; or do you see an advantage of going to V UK ports are less competitive than those on the Cardi first? continent due to the lack of a public subsidy for Mr Whitehead: That is a good $64,000 question. ports’ development. Do you agree? Mr Whitehead: Yes; that is a certain disadvantage. Q104 Albert Owen: It is a good time to ask it. The picture is not all gloom for the UK. The UK Mr Whitehead: You are absolutely right. The private sector ports industry system is a system that Marine Management Organisation for English ports the industry is quite comfortable with and wants and will sweep up Harbour Revision Orders and we get clear advantages from that. Where we fall licensing and so forth. The situation in Wales, as we down is that we do not get the investment that the understand it, is that those functions could well go continental ports get, and especially they get road to CardiV. It is a question of resources and expertise and rail connections relatively easily to their ports, because the Marine Bill sets up a huge marine paid for by the government, in a much more planning process; it is putting all the licensing coordinated way than we do. expertise together in one organisation. It seems to us Mr Kennerley: It is a very diYcult thing to measure that it would make sense for all applications to go as well in that continental ports are feeding into a there and not to be split between two centres. But, much bigger hinterland, so there is a natural you know, this is a calculation for us and where our economy of scale for shipping to move in larger ships best interests lie and if the decision goes to CardiV we and therefore they have an advantage that they are would say exactly the same—the resources have to feeding into a bigger population. But that can also be suYcient to be able to carry out this work. Ports present opportunities for UK ports and ports in fundamentally depend on these licenses. Wales in that we can oVer alternatives in terms of Mr Kennerley: And the way that those organisations feedering cargoes and avoiding some of the big calls operate needs to be consistent as well across the UK into the UK, possibly, and avoiding then long road because Welsh ports are not just serving Wales, they haul links across the country and with associated are serving a much broader hinterland into the environmental benefits as well. So there are Midlands and into the M4 corridor and are therefore opportunities there that might come out of feeding competing with other ports in the rest of the UK. So into a lower population, basically. Processed: 29-10-2009 19:48:10 Page Layout: COENEW [E] PPSysB Job: 435922 Unit: PAG3

Ev 24 Welsh Affairs Committee: Evidence

23 June 2009 Mr Matthew Kennerley, Mr David Whitehead and Mr Ted Sangster

Mr Sangster: But there are other competitive prospect of the Severn Barrage. You actually cover disadvantages with container ports as well. One is in quite a range of ports so you have a variety of some of the support that David touched upon. In diVerent responses probably. some aspects some continental ports get subsidy or Mr Kennerley: Yes. the dredging is undertaken for them, rather than being the responsibility of the port. Secondly, a number of ports, such as mine in Milford Haven— Q109 Alun Michael: Do you see it as full of and I believe that some of those in South Wales—are opportunities or problems or challenges? subject to the Habitats Directive and all our port is Mr Kennerley: At the moment we are still looking at designated a Special Area of Conservation. The way what various alternatives there are. There have been in which the UK has gone about that is diVerent to five schemes put forward now into phase 2 of the the way in which many European countries have assessment and it will very much depend on which gone about it, in that in the UK we follow the letter one of those schemes comes out. But if we are talking of the Habitats Directive and the whole of the port— about a barrage across the Severn, which seems to be the scheme that everybody is more focused on, then 60 square miles of the port is an SAC. In continental V administrations such as Germany, Holland, France clearly any obstruction that slows or has an e ect on and so on the navigation channels and the ports a ship’s passage through to its destination or from its themselves have been not put in the SAC in loading port creates a competitive disadvantage with recognition of the economic and social value of the a port that does not have that obstruction. So in ports and not imposing this extra layer of terms of ongoing business then there is probably a negative impact on most of the business coming up environmental hurdles and legislation upon them. V So that is an approach that the UK Government beyond that barrage and that includes Cardi , Newport and the Port of Bristol. The ports outside decided to take in following the letter of the Habitats V Directive, which a more pragmatic approach, as that barrage then are obviously clearly not a ected, taken by some of the continental countries would and we have Port Talbot down in the west that could not have given us these extra hurdles, as it were. benefit from that in that some of those ships might Another point of that of course, looking at the see that as a more viable alternative rather than continent and the UK and Wales, are light dues. It coming all the way up the Estuary.There is a positive does not aVect ports directly but it aVects the side to it as well because during the construction customers using the ports and the way in which the phase any port facilities in the Severn Estuary are UK Government requires shipping companies to clearly going to have a role to play in that in terms of pay light dues and has recently increased those by a moving materials and the whole logistics of building significant amount can put UK ports at a such a huge structure; so there is a potential positive disadvantage in attracting some shipping calls, there as well. I think providing the marine restriction, angles of that and how we get ships in albeit, as Matthew has indicated, that can create Y secondary opportunities in terms of feeder services; and out of it e ciently without causing delays and at but in the UK economy those feeder services no extra cost, providing those things can be covered probably cost extra in terms of servicing the basic then it does not mean to say that a barrage could not economy requirements so there is a cost to the UK be accommodated and our ports could not operate economy in doing that, whilst there might be an in a viable manner, but there is a lot to think about. advantage to some UK ports. Q110 Alun Michael: So are you saying that CardiV V Q106 Alun Michael: Each of your answers have and Newport in particular would be a ected clearly, indicated that there are swings and roundabouts. but would still have a business? Mr Kennerley: There are, yes. Mr Kennerley: They could still operate providing those issues of access through the barrage can be addressed and that there are no additional costs then Q107 Alun Michael: If there were specific concerns presented to the ship owners, who will compare that you wanted to highlight we would be open to Newport with coast ports outside the barrage on the hearing about them. south coast or east coast even, or further round on Mr Kennerley: Just to add on to that and just the west coast. building on what David was saying, we are funded very diVerently than a lot of diVerent continental ports and we rely on meeting certain financial Q111 Mark Williams: I would like to turn to some criteria in terms of port investment and some of the future opportunities available to the ports. We continental ports, because of the way they are have heard in some of the submissions we have had funded, do not need to follow those specific criteria; about the future or the cruise market, the supply and so there is a diVerent financial model then played out generation of energy sources, energy generation on in terms of how the customers are charged and land adjacent to ports. What actions as port owners therefore which way their cargoes move through have you taken and continue to take to harness some those facilities. of the new development opportunities at ports themselves or in terms of the development of trade routes? And fundamental to that what is the role of Q108 Alun Michael: The other issue at the moment is government? You have touched on the Welsh on the horizon rather than just outside the port, but Assembly Government; what is the role of perhaps particularly to Matthew Kennerley, the government to promote those opportunities? 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Welsh Affairs Committee: Evidence Ev 25

23 June 2009 Mr Matthew Kennerley, Mr David Whitehead and Mr Ted Sangster

Mr Sangster: To answer your last question by that we are talking about, speaking frankly here, answering the first part of it, to give an example— cruise ships do not tend to be huge revenue cruise. There is a very real opportunity for Wales as generators for ports; they are fairly limited. But they a whole to benefit significantly in more active are potential huge revenue generators for the local participation in the growing and expanding cruise authorities and for the local cities in terms of their market in which the market itself is expanding, and oVering. Whilst we have those facilities available to the interest in northern Europe and the British Isles us we are actively encouraging that because that as a cruising ground is expanding as well—it is helps with the economic development of the areas growing at about 8% or 9% a year—the figure is not around which and in which we are operating. So in my mind. Wales is under represented in terms of whilst it is not going to deliver huge financial its participation and yet the reason why cruise advantages to our operations unless you are in the passengers are attracted to north Europe and the scale of, for example, Southampton, where we are British Isles are exactly the sort of things that Wales handling up to 300 cruise calls a year, we believe it is can provide—the culture, the history,the scenery,the still a useful addition to the port and it helps to atmosphere, the crafts and so on as well. So what has promote the port and people have a diVerent vision been happening over the past number of years is that of what is going on inside the port as well. So there ports working together in Wales, together with the are societal improvements as well. Welsh Assembly Government and other tourist bodies from county councils-related, have been working together to promote Wales as a cruise Q113 Mr David Jones: This Committee has destination, recognising that any one of us acting by recognised that from Members of this Committee ourselves are not going to be successful because no standing on the quayside at Stockholm last week cruise company is going to want to send a ship to one with a huge cruise liner and there were thousands port—it has to be a port as part of a package, part of people. of a seven-day cruise or whatever. Indeed, that sort Mr Kennerley: It generates a lot of interest and it is of partnership needs to go beyond Wales, so we an area we are supporting. forged links with Ireland, for example, and we Mr Whitehead: The renewables industry is another recently, led by Anglesey County Council, were big opportunity. You referred earlier to what does successful in getting an Intereg bid for about 1.4 the industry do with the government, there has been million Euros for a three-year programme for some good material issued by DECC in terms of V marketing the Celtic Sea for cruise. So that is a very which ports are suitable places for servicing o shore real example of a market opportunity and the way in wind farms and so forth. I think there are about four which ports in the private sector and the public in Wales that have been identified, and then it is up sector locally and the Welsh Assembly Government to the ports to step forward with the investors to take can work together on behalf of, in this case, the that on. Matthew was saying that perhaps the cruise whole of the Wales tourism industry. industry in its visits to ports does not generate a lot of money but with the renewables industry there could be a real opportunity there and it is something Q112 Alun Michael: What are the origins of that we are looking at. In terms of cooperation, we now initiative? Was it from the Assembly Government or have a system where every port is encouraged to was it yourselves as operators? produce a master plan, which identifies the pressure Mr Sangster: We as a port started 10 years ago in that that port will put on the local infrastructure, on promoting and selling the port and south west Wales the planning system and so forth. This was to the cruise industry. We joined Cruise Europe, an developed jointly with the DfT, so this again is ports organisation for European ports. We were one of the perhaps speaking more clearly about what they are founder members of Cruise UK and from that and going to do and what their markets are going to do; the contacts that we had and similar recognition so there has been some quite useful cooperation. happening elsewhere we were one of the founder Mr Kennerley: Can I just go back to the question of members of Cruise Wales, in which the Wales Tourist energy—and I think Ted will comment on his area Board, as was, was a driving force and that has been anyway—that energy is a big part of what we already carried forward. do in terms of supplying energy producers, Mr Kennerley: We are similar. In terms of the cruise generators with power station, coal or other fuel in particular we see cruise developing in Wales along sources. We see that the ports are well positioned the lines that Ted has described there, to build on to from a land holding point of view, from the vessel some of the attractions that Wales can oVer in terms access point of view as more generators rely on of its coastline and the various heritage sites and imported fuel supplies, whether that be coal, oil or cities in the country. Longer term potentially for biomass. Ports are unique in a way in that very often regional departure points so that as some of the they are well connected into the local energy supply bigger ports become focused on some of the bigger grids as well as the National Grid and we see that cruise lines then some of the more regionally right across our South Wales ports, so there are operating cruise lines operating in more niche opportunities in Wales to develop additional energy markets can use ports in Wales to embark and resources and there is talk of an energy gap in the disembark their passengers at the start and the end UK within the next 10 years or so or perhaps even of their cruise, and that is a diVerent prospect sooner than that, and we see that our ports are in a altogether. We genuinely believe that in the future very good position to provide locations for there is a potential for that. For ports in the scale generators to build new power stations, whether Processed: 29-10-2009 19:48:10 Page Layout: COENEW [E] PPSysB Job: 435922 Unit: PAG3

Ev 26 Welsh Affairs Committee: Evidence

23 June 2009 Mr Matthew Kennerley, Mr David Whitehead and Mr Ted Sangster they are biomass, multi-fuel, peaking plants, there is a potential to develop more unit load whatever—we have the facilities that can business and from that encourage inward investment accommodate all of those things and it is one area to develop facilities for logistics and distribution for where we have seen some fairly interesting secondary manufacturing that can build on a unit developments. Prenergy, for example, in Port Talbot load operation. So instead of containers perhaps now have planning for a 350 megawatt woodchip being routed through east-cost ports in the UK from burning power station. You mentioned the deep sea lines, which all call on continental ports as government and what their involvement is; I think they are coming through, there may be an what we need to see from the government is a opportunity to oVer a more local port of entry for consistent approach to planning to make sure that those cargoes, which would reduce road haulage and our ports which are industrially zoned we can enable a longer sea journey basically. With that we continue to develop them as port locations, and see some of our port areas potentially and peripheral whilst recognising that there are other leisure related areas around—and this is the important thing, to activities in and around their boundaries that we are make sure that local authority plans are engaged port locations and we have unique facilities here and with the Port Master plans to make sure that those we need to make sure that they are promoted in areas are also their potential to do this sort of that way. additional processing and manufacturing and then get the value out of the goods that are coming Q114 Mr David Jones: To revert to the point you through the port maximised. It is important to keep were making about the economic benefit of the that value in the location where it would count. cruise industry, has any research been carried out as There will always be an element of through traYc to the per capita spend of cruise passengers in this serving a broader hinterland but we think that ports country? The reason I raise it is that when we were can play a much greater role in that economic in Tallinn in Estonia last week we were told that the development scene. average per capita spend was only ƒ29 in the port. Mr Kennerley: We did a study in Southampton—I spent some time working in that port—and a study was carried out there with the assistance of the local Q117 Albert Owen: So what you are describing is this authority, I believe. An attempt was made to new business or is it business that goes in via road or measure the economic value and if I recall—and ship and across land more on to sea? again this would need to be checked against the Mr Kennerley: As an island a lot of this business documentation—it was anything between £50 and comes by sea anyway and that is really what we are £100 per passenger and when you look at talking about, oVering alternative routes that means Southampton handling 650,000 passengers per year we can reduce the amount of road miles involved in that is a significant impact into the local economy. I some of the traYc that is coming into Wales, most of am not sure if anything has been done in Wales. which now will have to come—when I am talking Mr Sangster: As part of Cruise Wales, as I unit loads here, primarily heading for the retail mentioned, one of the first things that Cruise Wales sectors or secondary manufacturing—on a fairly did was to commission a study as to the market long road haul at the moment or by rail from an east opportunity for cruise in Wales, commissioned from coast port. What we think there is potential to do is a company called GP Wild. As well as identifying the to oVer a more locally based port option for those market opportunities one of the things they looked sorts of cargoes. at was exactly that spend and they came up with Chairman: Can I ask you, with all due respect, to figures, similar to those that Matthew has answer the questions in a somewhat shorter form mentioned, between £80 and £100 from each because we have a large numbers questions to ask passenger going ashore and about £30 from each you. crew member as well because you had crew members going ashore, stretching their legs and going to the restaurant and getting a beer or going and getting some groceries or toiletries, whatever—they are a Q118 Albert Owen: Going on to the cruise business, part of that spend as well. the original question was what has been the role of government and obviously there is need for Q115 Mr David Jones: Would it be possible for you assistance with infrastructure. Some of these vessels to point the Committee Clerk to that piece of that we have seen now and the potential for growth research? in the future are going to require deep water and they Mr Sangster: Yes. are going to require longer berths, which are hugely expensive to build, particularly, as Mr Whitehead Q116 Albert Owen: What is the impact of the trends said, it is not great business for the port itself. So do of the international market and the increase in you see the role of Cruise Wales to facilitate between freight and container use and do you have any plans yourselves as the operator and the government to get for future growth? a package together? Mr Kennerley: There are three or four strands to our Mr Sangster: Yes. If Wales is to realise the full strategy moving forward and each one of our South potential of cruise Wales needs to have berths that Wales ports is slightly diVerent in its hinterland and can accommodate cruise ships up to 300 metres in its capacity, but certainly for CardiV and Newport length. It does not at the moment. Wales of course Processed: 29-10-2009 19:48:10 Page Layout: COENEW [O] PPSysB Job: 435922 Unit: PAG3

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23 June 2009 Mr Matthew Kennerley, Mr David Whitehead and Mr Ted Sangster can take ships up to about 150 to 200 metres and we concern is that and, again, should that promotional can take them longer than that but they have to work be the role of government or local authorities anchor and tender their passengers ashore, which is or the port operators themselves? increasingly less acceptable, as you will probably be Mr Kennerley: It should be a joint eVort really. familiar with. So the Welsh Assembly Government Clearly we are out there marketing our own facilities have indicated through the work that they have been but I think those introductions could be made doing with Cruise Wales there are possibilities for sooner to many operators or many potential such developments in North Wales at Holyhead and business development proposals. in South Wales in Milford Haven, where in Holyhead there is a facility with the Rio Tinto Jetty, which can be converted, and work is being done on Q122 Mark Williams: Who would you look to that and in Milford Haven there is a site currently facilitate that? owned by Pembrokeshire County Council which we Mr Kennerley: It should be coming through WAG are working with the County Council and the Welsh really who are making those introductions and Assembly Government in developing that site for thinking about the port resource—this is the point I multi use and one of those uses is a deep water, large made earlier—that is on their doorstep and making cruise ship berth. sure then that thereafter everything else then, the planning regimes that apply are conducive to that Q119 Albert Owen: Just on that, you said about the sort of development to bring that value added growth being 8% to 9% expanding business. Is it not benefit into the local economy. the case though that the bids for cruise liners in two Mr Whitehead: If I might add a point? Perhaps one or three years have to be done now in the of the diYculties has been getting the Welsh ports international market, and is there clarity that these collectively to come together and express themselves berths are going to be ready by then? as Welsh ports. And we have just set out a Welsh Mr Sangster: You are quite right that cruise ship ports group, which met at the beginning of June and marketing is a slow burn, so if you were talking to there were WAG oYcials there, all around the table cruise customers now you might get them in four or talking together about opportunities and the five years’ time. Once you have credibility they will relationship with WAG and the relationship with make bookings for you a couple of years ahead. One DfT, so we regard that as a really important step so thing that Holyhead has found, with the indication that they are on their way to providing what has been that maybe things like inward investment can be looked at for a long time, an alongside cruise ship addressed by that group and they can start to berth, is that their bookings for the intervening produce material and a website and so forth to do period have increased significantly. So if you can that; so the industry has started to get together a work with the cruise industry and show that you are bit more. working with them and you are finding a solution they will then come back and they will partner with you to enable you to build up to that. But you need Q123 Hywel Williams: Good morning. Can I ask to be quite firm about it and to demonstrate that you about the use of land and how do you balance what you are saying will be delivered. the shorter term demands that you might have with the longer term expansion aims of the port itself, for Q120 Albert Owen: You mentioned Cruise Europe, example in Milford Haven. Is there a tension there? Cruise Britain, Cruise Wales: is there not a niche How would you achieve that? market for Celtic—you touched on it. We saw the Mr Sangster: You are quite right, there is; and I can Baltics coming together and having destinations to point to ports elsewhere in the UK in which short four or five unique destinations. Is there a plan that term decisions are being taken which develop land Cruise Wales has to adopt that on the western for other uses, maybe housing or warehousing, seaboard? whatever, that then deny its use for port Mr Sangster: Absolutely and that is the basis of the development in the future. In our own local context Intereg bid that I mentioned of ƒ1.4 million to there are not many sites with access to the water. Our market the Irish Sea—a partnership between the policy is to work with the county council to identify south west of England, Ireland and Wales and these sites and with the county council identify around the Mersey and the Isle of Man, to promote appropriate use for those sites, making use of access a cruising ground, if you like, in the Irish Sea. to the water. One of the largest sites is actually owned by the county council so our arguments fell on to Q121 Mark Williams: Just to go back to the issue very receptive ground and we are working again about who is responsible for the promotion of collaboratively with them to ensure that that site is development opportunities—this is addressed to Mr developed appropriately; but there are other smaller Kennerley. In your written submission you noted sites as well that, if allowed to be developed for about a large number of business with extensive particular uses, could deny opportunities for supply chains have been encouraged to locate in expansion even in a leisure capacity for more Wales and you cited the example of Amazon, but marinas and moorings and so on in the future, and you gloomily went on to point out that companies that is in the forefront. The planning system can have not been made aware of the oVering of ports help—and certainly in our own context, the way in and what ports are able to oVer them. How big a which the county council and the National Park are Processed: 29-10-2009 19:48:10 Page Layout: COENEW [E] PPSysB Job: 435922 Unit: PAG3

Ev 28 Welsh Affairs Committee: Evidence

23 June 2009 Mr Matthew Kennerley, Mr David Whitehead and Mr Ted Sangster going about their development plans to identify such Q126 Mr David Jones: You did not quite answer my sites, we have had the opportunity to put in our question though. The question was how do you views as indeed have others as to appropriate think it should be resolved? Clearly it would appear development. that on your evidence there is a disconnect between the road infrastructure in England and Wales. Mr Whitehead: First of all, we have to see what the Q124 Hywel Williams: Is this the case generally for plans are and then we have to see where the funding other ports apart from Milford Haven? I am might come from, and that might be TENs funding thinking in my own area of a very small leisure or other sources of funding. It could be that there is development in Pwllheli where there have been a turn to developer contributions. One of the problems in developing the quayside for the marina diYculties we have in England is that if you want to because of the uses that have been allowed over the develop a port infrastructure connected to a port years and clearing all that away is hugely then the port is expected to make contributions to problematic. Thinking in entirely another context— those developments; so that is possibly another the building of a car park is going to probably make option that we have. We are waiting to see what the it diYcult to have a cargo handling facility in a proposals are. particular place. To the other two witnesses, do you Y think that there is su cient recognition within local Q127 Mr David Jones: To what extent and how do planning policies of participating in planning in you feel that Welsh ports could be more involved in this respect? consultation on transport spending decisions? Mr Kennerley: There are issues there and I can think Mr Sangster: If I can put things in a local context I of some examples in Swansea where we have seen the mentioned the A40, because the Welsh Assembly development of SA1 and the potential marin there Government is in total control of that. What is with leisure and retail around it and clearly that is needed there is active consultation between us and very close to some of the port activities and some of the government and the south west Wales business the port areas that we see as having continued community, the ports, the county council and so on, commercial potential for biomass power stations, and working to find a satisfactory solution which for example. I think that the planning regime does has not happened. There is a patchwork of partial create some issues there in terms of how schemes like development taking place which does not really that which could generate a bit of noise and bit of address in any satisfactory manner the real needs dust now and then are potentially perceived locally. that this could bring about. In the context of the Clearly our master planning process is about relationship between your original question to identifying those areas and making sure that we David about the Department for Transport and the protect our interests in those areas and keep them Welsh Assembly Government, the answer in the available for commercial development. current situation is that of close collaboration and Mr Whitehead: I am not aware of any particular working together. Working in concert to the same problems. Obviously once you develop waterside sort of time scales rather than the impression given land that is it, you have lost it; and it is a very at the moment with a diVerence in the levels of time precious commodity—quite a rare commodity as scale and also detail as well. It may well be all going well in many ways. So the planning system has to be very well behind the scenes but like a swan sitting on thoughtful about what it does. I come back again to the water there is lots of activity happening this issue of master planning—each port articulating underneath but our impression is that there does not what it wants to do in a clear way so that all the appear to be much happening on the top. planners and everyone involved—potential investors—can see what the picture is. Q128 Mr David Jones: Do you have any evidence that anything is going on behind the scenes? Mr Sangster: The confirmation that we have had Q125 Mr David Jones: Can we return to the national from our discussions as the Welsh Ports Group with corridors that we touched on earlier in this evidence the Welsh Assembly Government is that there will be session? The BPA’s submission raises concerns of a statement coming out very soon which will course about the fact that Welsh road routes are not demonstrate the way in which they are in accord part of the Strategic National Corridors; how do you with linking up with the work that is being done in think that that could be resolved? England. Mr Whitehead: We wait expectantly for this new consultation actually. When this group met in June we were told that the arrows do not disappear at the Q129 Alun Michael: Could I ask you particularly Welsh border and in fact there will be something about Milford Haven. What changes you are there, there will be proposals there. So obviously it is experiencing particularly in relation to security diYcult to comment on something that we have not requirements as a result of recent developments and seen. But these north and south routes, it is said so do you feel that the level of policing and security often are so fundamental to the ports themselves and arrangements is adequate? as Eddington showed the investments in links to the Mr Sangster: As a port, having operated ferries since ports produce excellent value for money as well; so the 1970s to Ireland we are well used to terrorism these things are all tied in. security provisions under the various requirements Processed: 29-10-2009 19:48:10 Page Layout: COENEW [O] PPSysB Job: 435922 Unit: PAG3

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23 June 2009 Mr Matthew Kennerley, Mr David Whitehead and Mr Ted Sangster in that part of our business. Having supported major that Dyfed Powys Police have been making sites with the oil refineries over the years they and representations for improved resources to enable therefore we are well used to the security provisions them to better deliver to what they see— regarding those sites. You are quite right, there has been an increase in the level of interest and an Q130 Mr David Jones: It is a long established increase in the level of perceived risk associated with tradition I have to tell you. changes that have taken place and physical changes Mr Sangster: Quite rightly, yes. They have made a with the new LNG terminals being built, now on very good case to us and we support that case. They stream, and that has provided a sharper focus. have made it elsewhere; they have yet to get an Running alongside that was the introduction of the answer to it, I understand. If you have not already International Shipping and Freight Port Security you will be receiving their case in evidence from Code about four years ago and, more recently, the them. We and the port community, including the European security requirements as well. The LNG and the oil terminals in Milford would support terminals comply with all the existing regulations the case they are making for a greater range of assets, and requirements and the plans are actually particularly in marine assets, to enable them to exercised and demonstrated. We in our port have undertake security responsibilities. also taken the lead in coming together as individual Chairman: Thank you very much for your evidence operators to work collaboratively with TRANSEC, today and also thank you for your written evidence. the security part of the Department for Transport, I apologise for rushing you earlier on but we have a and other agencies including the police and Special very tight schedule today and I hope you appreciate Branch, to share information and to have a that. If you feel that there are other matters that you concerted approach. In the context of you would like to raise with us we will be very happy to mentioning the police and their resources, I know receive a further memorandum from you.

Witnesses: Mr Bryan Graham, Head of Planning Services, City and County of Swansea, Mr Richard Workman, Director of Technical Services, Carmarthenshire and Mr Kefin Wakefield, Head of Economic Development, Pembrokeshire County Council, gave evidence.

Q131 Chairman: Good morning and welcome to the Welsh Assembly Government and the Association Welsh AVairs Committee. Could you for the record of British Ports. So, very briefly, that is a description introduce yourselves, please? of the role of the planning process. Mr Workman: Good morning; I am Richard Mr Workman: From the Transport Consortia Workman, Director of Technical Services at auspices, Chairman, obviously we are putting Carmarthenshire County Council and the current together a Regional Transport Plan within the OYcer Chair of SWWITCH, which is the Regional context of the Wales transport plan, which actually Transport Consortia for south west Wales. sets the context for priorities within the region. All Mr Graham: Good morning; I am Bryan Graham, of those priorities are not necessarily in our own gift Head of Planning Services in Swansea Council. to deliver because the trunk roads and the rail system Mr Wakefield: Good morning; I am Kefin are within WAG’s auspices. However, what the Wakefield, Head of Economic Development for Regional Transport Plan will enable us to do is to Pembrokeshire County Council. deal with the issues of connectivity that we have been hearing about from previous evidence and access to the ports in trying to build the network to give better access to the ports and egress from the ports. Q132 Chairman: Thank you very much. Could I Mr Wakefield: In Pembrokeshire many of the begin by asking you a straightforward question: as developments along the Milford Haven Waterway local authorities what influence or impact or have been of a scale that has taken them outside of involvement do you have at the Welsh level and at normal planning regulations. More recently—or the UK level in terms of port development? most recently—the approval of the new power Mr Graham: If I could start—and obviously I am station which was 2,000 megawatts fell within the speaking specifically from a Swansea perspective? remit of DECC. The process took approximately The council through the planning process provides four years from submission through to consent. The the land use planning framework, the spatial local authority influence is principally through the local development planning process and through the planning policies for the development of the port at transport network which services the roads around Swansea and its hinterland. In my evidence and the Haven as opposed to into the county. We also submission I have described that process in relation have interests within some of the environmental to the preparation of the council’s Unitary controls and regulations and a special area of Development Plan, which was adopted last year, and conservation in and around the Milford Haven obviously there was an extensive consultation Waterway. process that that involved, including, for example, consultation with the Department for Transport in Q133 Alun Michael: I think you have set the context England, which obviously has responsibility for in terms of the planning processes, both locally and policy in relation to ports; but, more specifically, the more widely but I wonder if I can ask more in terms Processed: 29-10-2009 19:48:10 Page Layout: COENEW [E] PPSysB Job: 435922 Unit: PAG3

Ev 30 Welsh Affairs Committee: Evidence

23 June 2009 Mr Bryan Graham, Mr Richard Workman and Mr Kefin Wakefield of the needs of ports and how they get promoted. they no longer required. Certainly a fundamental Where you see the ports and where they lie in your principle that we adopt is that we rely on ABP to tell authority’s priorities, is the importance of the ports us what land and facilities they need because of the something that is going up, going down or standing importance that the authority does attach to the still? How do you proactively seek to ensure that the port’s continuing success as an operational port. In ports in your authority’s area are the ones that are economic development terms we also have regular successful? meetings with the ABP operators and provide what Mr Wakefield: If I may start, Chairman? We have support we can for local firms to use the port just done some work through our own county facilities and also to benefit from tourism derived council scrutiny committee to look at the impact of initiatives, such as the Swansea-Cork ferry and the energy sector; clearly the energy sector along the services to Devon, which are due to come into eVect Milford Haven Waterway is a consequence of the next year. deep water facilities of the port itself and led to the Mr Workman: From a SWWITCH perspective establishment of the port authority as an authority. obviously we work under the auspices of all four So the impact is very considerable. The energy sector local authorities in the region, so we are promoting employs over 2,000 people and generates £100 the aims of the four authorities. A lot of what we do million a year into the local economy. The marine is look at east-west connectivity as a whole that you sector on top of that will generate additional jobs mentioned, which, by definition, has a general and additional spend and the diversification of that benefit to the ports because, again, as we heard marine sector, particularly into marine leisure, is earlier, those are the routes which need to be something that we encourage and we see as having improved. More specifically our Regional Transport further growth potential. The diYculty, as Mr Plan, which is due to be submitted in September, Sangster referred to, is looking to the future and identifies a number of priorities which will have a trying to understand how you accommodate the direct impact on the ports. So, for instance, there is changing needs of ports in an uncertain world. He significant investment continuing to go into the Port referred to a particular site which has reasonable Talbot distributor road, which will provide a much access to deep water, which we are working with the better access into the facility there, and that is port authority to try and find a way of bringing that planned in the next two to three years. We are forward for development; but the nature and cost of continuing to promote Assembly Government that development has many variables—how big that improvements to the A40. There are some site should be, how much reclamation, what are the improvements taking place but we are promoting access and services costs for serving it, what the end further improvements. Some of the local access use might be and is it a viable proposition to bring issues around Pembrokeshire and Milford Haven, forward are all imponderables at this stage, which we again it is contained within the Regional Transport are starting to address. It is a complex challenge to Plan. So the Regional Transport Plan does directly try and look into the crystal ball to see what the address the issue of ports and, more generally, optimum development might be for the future of the addresses the issue of accessibility; so there are port and wider economy. specific examples of how we are promoting that.

Q134 Alun Michael: And that is something that the Q136 Alun Michael: Can I ask you about the role of local authority, if I understand you correctly, is the public sector in relation to private ports? taking a lead on rather than being reactive? Mr Graham: ABP is obviously a private company Mr Wakefield: Very much. We work strongly in but I would not say that that has any eVect in the way partnership with the port authority because they are that we deal with them. more than a port authority; they are a vehicle for regeneration as far as we are concerned and are Q137 Alun Michael: No issues? therefore key partners within the planning process Mr Graham: Not that I would say. for the Pembrokeshire economy. Mr Wakefield: In terms of Fishguard, which is a private port, again I think we have a very positive Q135 Alun Michael: In Swansea of course there is a working relationship with Stena, and we share diVerent situation. development objectives for the port and Mr Graham: Yes, I think that there is an extensive diversification of the port, which to some extent was and ongoing liaison associated with British ports to triggered by the Welsh Assembly Government and try and ensure that we meet their requirements, their regeneration response to a major closure in whether it is in terms of land use planning, the Fishguard, which resulted in a regeneration plan for safeguarding of operational land and the the town in which quite clearly the port played an importance of striking a balance between the important role. So a positive working relationship. retention of that land and the marina development, of which there has been quite a lot in Swansea, as you Q138 Alun Michael: Could I finally ask about the are probably aware, and reference was made by one approach in Pembrokeshire to suggestions of of the previous speakers to the potential conflicts privatisation of Milford Haven? that that can generate; although I would stress that Mr Wakefield: I think our concern is that there may that development eVectively went ahead with the be pressure for privatisation, and the port as I blessing of the port to the extent that it was surplus mentioned earlier is more than just a Port Authority. land, it was redundant land that was released which I think our concerns would be found at a number of Processed: 29-10-2009 19:48:10 Page Layout: COENEW [O] PPSysB Job: 435922 Unit: PAG3

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23 June 2009 Mr Bryan Graham, Mr Richard Workman and Mr Kefin Wakefield levels. I think the first level is that clearly the port, or Q141 Mark Williams: If there was likely to be a the operations which are dependent on the port, are predicted increase in traYc flows to your port, to there largely in the national interest and that the Milford Haven, or Fishguard for that matter, would management of the port should not be allowed to the county council proactively engage with the hold those operations to ransom in any way; so there community and alert them of that; or would there be is a national interest concern: but the more local a response from the community—predictable concern is that the operations along the port are pressure groups emerging and then campaigning in intrusive within the landscape, and to some extent that way? some of the operations are intrusive from a Mr Wakefield: It depends upon the nature of the community point of view. The Port Authority can business. Once you start talking about LNG, which V V pay back and o set some of that negative e ect is highly specialised, I think we prefer that the through its own investments in refurbishing areas engagement is led by the experts who have the which have become derelict, and there are two responsibility for managing that activity. Clearly we examples, I suppose: the first would be Milford have our own engagement processes with our Docks which, in the decline of the fishing sector, was communities and structures in place; and in the left derelict; the Port Authority was instrumental in normal course of events we would discuss these finding a new use and bringing that forward in a way things and reach a sensible conclusion on the best which helped to add value to the town, by way forward. diversifying the town’s oVer; and, secondly, within Mr Graham: I think it is undeniable that in Swansea Pembroke Dock, where the legacy of many there are tensions, and there have been historically, Georgian structures were decaying, the Port between the operational activities of the port and the Authority again became involved in helping to adjacent communities. I am talking not just about restore some of those structures. It is also involved SA1—which is the generic name for the regeneration in helping to diversify the oVer in Pembroke Dock, again through its engagement in some marina- of the eastern side of the Tawe River; the related developments and port-related redevelopment and regeneration initiative that has developments. gone on over the last seven or eight years—but also the existing communities of St Thomas and Port Tennant which are to the north of the dock on the Q139 Alun Michael: You would see those sorts of other side of Fabian Way. I do not know if members things put at risk, would you? are familiar with Swansea at all, but this is an area of Mr Wakefield: Yes, I think we acknowledge, we inter-war housing which actually overlooks the would recognise, that some of that investment in docks, and historically there have been issues with regeneration does not oVer a return on investment in port activities, particularly in relation to the the strict sense, at least in the short-term. We also movement of aggregates and coal and associated have the view that much of the Welsh Assembly environmental problems that have occurred. In Government’s priorities for investment lie further terms of the Authority’s response and role, I think it east; and this helps to restore some sense of balance is fair to say that has again been largely carried out in terms of investment in infrastructure within the through the planning process. I do not think there county. have been any wider community-based initiatives. Reference was made by a previous witness to a Q140 Mark Williams: Mr Wakefield has actually biomass application. This was a planning pre-empted my question in terms of the community application for a biomass plant within the docks that engagement dimensions of this. How do you balance was actually refused planning permission by the the port’s need for eYcient freight movements with council. I had actually recommended it for approval, the needs of the community and the needs of the but there was a tremendous weight of local environment more generally? You talked about an objection, and members of the planning committee investment by the Port Authority back into those decided to refuse it because of their concerns over the communities. Could you say any more specifically perceived adverse impacts that it would have. I on that, or your colleagues? suppose fundamentally there is a lot of local member Mr Wakefield: I think we are fortunate in having a engagement, representation and interest in the Port Authority which is proactive in the way in operation of the docks. I would say that currently, which it deals with both the community and its and given that there are still activities at the port environmental challenges. There is a very good associated with the transfer of coal and aggregates, communications team and a good public relations there are not any ongoing environmental or so- programme of activities which help to bridge the called pollution issues; so it is something that we are gap, and therefore puts the Port Authority as part of able to balance. the Haven community. Similarly, in terms of the environment, the Port Authority has been proactive in hosting activities—the Marine Forum, for Q142 Hywel Williams: I did ask the previous example, and the Pembrokeshire Coastal Forum. witnesses about land use and would like to ask you They will host these activities within their own the same sort of questions. Mr Graham, you said oYces with infrastructure and support them in an earlier on that you had extensive consultations in the open-handed and fair way. I think there are a lot of planning process and also that you worked with public relations benefits in this. Associated British Ports? 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Ev 32 Welsh Affairs Committee: Evidence

23 June 2009 Mr Bryan Graham, Mr Richard Workman and Mr Kefin Wakefield

Mr Graham: Yes. particular area is developed then people have good access to the facilities and opportunities they would wish to take once they actually arrive at the ports. Q143 Hywel Williams: How do you identify— Mr Graham: Cruise ships have started to visit perhaps in Pembrokeshire as well—what surplus Swansea; it is a recent development. My land is available? How can that be put to use without understanding is that it does benefit the town, the compromising the future developments of the ports? city, perhaps in a more direct way than necessarily Mr Graham: I think it is fair to say that we have the ferry terminal did. Obviously people came across relied on ABP to identify land that they consider to when the Swansea ferry was open and I am glad to be surplus and we have not carried out any objective see that it is due to reopen next year. A lot of users or empirical analysis of our own to decide how much V land the port needs for operational purposes; we feel will arrive at the port and head o away; whereas that is ABP’s business, frankly. With the Unitary with the visits of the cruise ships they will focus on Development Plan, if you look at the end of my Swansea, the Gower Peninsula and the spend that evidence I included an extract from the proposals comes in is retained in the town. That is my map and it shows not just where the SA1 understanding. regeneration development has taken place and is Mr Wakefield: There have been cruise liners visiting scheduled to expand, but also there is some pink land Milford Haven and Fishguard over a number of there which is employment land; that is vacant land years in relatively small numbers. We see it as at the eastern end of the Kings and Queens Docks, important for the spend that they bring to the local which again has been identified with ABP’s economy. We see it as important because it opens up approval. As I say, we rely on them to identify their Pembrokeshire as a destination to new largely operational requirements, and then the regeneration international markets, which is a good thing. As a and the use of land that is surplus is put forward local authority we work with Stena or with the Port based on what is considered to be the most Authority to support them, particularly on the appropriate use of that land. The fact, as I say, that landward support side, whether it is encouraging the port still carries on as an operating port and new shopkeepers to open their doors maybe when they development is taking place it does seem to coexist are used to closing them on a Wednesday afternoon; reasonably comfortably. I think it is interesting that or, indeed, supporting and assisting in terms of when a planning application comes in, such as the guides, transport or whatever is needed. biomass, then public consultation takes place and that will then provoke a reaction based on fears of Q145 Alun Michael: I wonder if I could return what the impact may be. In terms of existing issues, specifically to Swansea, because I am a little bit the uses seem to coexist reasonably well. puzzled between the earlier answer that Mr Graham Mr Wakefield: In Pembrokeshire the existing gave and I wonder if he would like to have another Unitary Development Plan is a joint one with the go. You said there are no problems with the public National Park. There are policies, which you have sector support for developing Swansea Docks; your received in evidence, which set out our position. We later answer seemed to be much more about leaving try to be proactive, in the sense that in considering a it to ABP—let them decide how they want to use the marina development at Fishguard it has been land; yet you have acknowledged yourself, in talking possible to look at how such a development could result in an extension of land for the port. There is about the potential of tourist ships and so on, that an added value to the port from a leisure there is a much wider implication than just development, and I think that is a happy implications for business in the port by some of the coincidence. The new Local Development Plan is at activities that can be developed. Surely the City of a stage at which people have been invited to submit Swansea has to be very positively engaged, does it candidate sites. We, as an authority, and the Port not, in projecting the future, looking at the Authority, have flagged up areas of interest within opportunities that can be grasped and so on, as well that process; but we are still at a stage at which they as reacting to any plans from ABP about how they are purely aspirations on a piece of paper; so it is use their land? rather premature really to talk about the conclusion Mr Graham: Absolutely. The point I was trying to to that planning process. make was that we rely on APB through the development plan process to identify the land that they need to carry out their dock operations. Q144 Hywel Williams: On a diVerent tack, could I just ask all three of you if you have any thoughts on the potential for the cruise markets as far as Wales is Q146 Alun Michael: That will have changed over concerned? recent years. The dock’s operations have changed a Mr Workman: From a transportation viewpoint, lot. There were hardly any in CardiV 25 years ago; clearly there are issues in terms of developing the there is an awful lot happening now and it is cruise market. Tourism plays a major role in the expanding. whole region’s economy. Within an hour of ports— Mr Graham: Bear in mind we are talking about a and again this comes back to improving local access substantial area of land and impounded water at to visitor facilities within the region, bearing in mind Swansea. They have been able to declare land the expenditure we were hearing about earlier—I surplus to operational requirements and still retain think there are issues about ensuring that if that significant landholding facilities there. Processed: 29-10-2009 19:48:10 Page Layout: COENEW [O] PPSysB Job: 435922 Unit: PAG3

Welsh Affairs Committee: Evidence Ev 33

23 June 2009 Mr Bryan Graham, Mr Richard Workman and Mr Kefin Wakefield

Q147 Alun Michael: Could I just explore the other and Irish Government planning processes has been bit of engagement, because one of the things we said joined up. For example, our understanding is that to the earlier witnesses was that there was evidence the Irish Spatial Plan process seeks to reduce the of, in some cases, finances available in the local area congestion in and around Dublin and encourage to ports in Europe which are not available to ports growth points more extensively around the country. in Wales. What sort of support does the City of Whilst TENs covers the northern and southern Swansea give to the port? Has there been any issue routes, it is not immediately obvious how the Irish of public sector funding, for instance, under EC or Government aspiration to reduce congestion in state aid support at any time? Dublin ties in with investment on the southern Mr Graham: I do not think so. I have to qualify my corridor as one way of helping to reduce that response because it is not my area of responsibility. congestion. I think we would welcome some further I am reasonably certain that the Authority has not clarity really around that issue, and indeed how the provided financial support to the Port Authority. I TENs review, which is shortly to commence, is going can verify that and come back to the Committee.1 to consider that question.

Q148 Alun Michael: How about transport facilities Q151 Mr David Jones: Thank you. You have also related to the docks? Again, we heard in earlier mentioned in your memorandum that you would evidence that a dock is only as good as the transport wish this Committee to look very carefully at the for getting stuV out and away. Is that a priority as far response capability of the Dyfed Powys police given as Swansea is concerned? the recent expansion of the number of port-related Mr Graham: I think Swansea is well placed in terms installations that may be regarded as critical of connectivity, to use the phrase, given that there is national infrastructure. What are your specific a dual-carriageway link literally from the entrance to concerns about Dyfed Powys police’s capability? the docks, to the M4, to the motorway network. Mr Wakefield: In preparing evidence for this Clearly reference has been made to problems Committee I consulted with other colleagues, Y elsewhere further down the M4; but in terms of including our emergency planning o cer; I think the accessing the motorway network it is probably no point has probably been covered by Mr Sangster. more than two or three miles at most from the The increase in installations of national and entrance to the port to the nearest M4 junction. international interest and importance has expanded. There is also a dedicated rail link to the port. I do not The UK economy is, to a significant extent, believe it is in use at the moment but it is there and dependent upon the energy installations along the it is safeguarded. Fabian Way, which is the dual- Haven; and it is a concern, I think, which has been carriageway link from the port, is due to be trunked talked about elsewhere that there needs to be by the Assembly. adequate police resources to respond to issues which may arise in the future. Q149 Alun Michael: As a city do you have a vision Q152 Mr David Jones: Do you have doubts about for the future of the port within the future of the the capacity of Dyfed Powys police in this regard? wider docks area? Is it a vision you share with ABP? Mr Wakefield: Certainly Dyfed Powys police have Mr Graham: I think it is. Not just in the Local expressed concerns about their capacity. Development Plan but in the Council’s Economic Development Strategy and reflected in the Wales Q153 Mr David Jones: That is a concern you Spatial Plan there is an acknowledgement of the share, clearly? importance that the port plays in terms of the Mr Wakefield: Yes. prosperity of the town as a whole. Q154 Mr David Jones: What about the emergency Q150 Mr David Jones: A couple of questions for Mr services, apart from the police? Wakefield. The memorandum that you supplied to Mr Wakefield: I am not terribly well qualified to talk the Committee highlights the opportunities about fire, ambulance and health facilities in general. provided by the TENs review. Why would you say There have been concerns voiced in the past but I am that such opportunities had not been provided in the not really in a position to quantify or detail those past; and what do you think could be done concerns. diVerently this time? Chairman: Thank you all for your evidence this Mr Wakefield: It has not been immediately obvious morning, and also for your written evidence. Again, to us as a local authority how the prioritisation of I would repeat what I said earlier, if you feel there are TENs within UK Government, Welsh Government points which we have not covered today we will be very pleased to receive a further memorandum 1 Not printed from you. Processed: 29-10-2009 19:51:07 Page Layout: COENEW [SE] PPSysB Job: 435922 Unit: PAG4

Ev 34 Welsh Affairs Committee: Evidence

Tuesday 30 June 2009

Members present Dr Hywel Francis, in the Chair

Mrs Siaˆn C James Albert Owen Mr David Jones Hywel Williams Alun Michael Mark Williams

Witnesses: Ms Margaret Llewellyn, Cruise Wales, and Mr Jon Pinnington, Business Development Manager, Isle of Anglesey County Council, gave evidence.

Q155 Chairman: Good morning and welcome to the masters bringing in vessels. We have actually Welsh AVairs Committee and our inquiry into ports managed to simulate bringing in the Queen Mary, in Wales. For the record, could you introduce but she would have to go on the opposite side of the yourselves, please? berth to the present Anglesey Aluminium jetty.What Ms Llewellyn: I am Margaret Llewellyn and I am would be required is one dolphin so that the stern representing Cruise Wales. lines can be secured away from the jetty, but Mr Pinnington: I am Jon Pinnington and I am essentially the jetty which exists, with some representing the Isle of Anglesey County Council. modification—improvements to fendering, bringing up to scratch, if you like, the navigational channels which in fact we are in the process of doing, and Q156 Chairman: Thank you. Mr Pinnington, could probably one additional dolphin will actually secure I begin with you and ask a question about Holyhead any size cruise vessel with the exception of the Oasis Port. We visited Holyhead Port recently and we were of the Seas, which is the new 240,000 ship. Many of very impressed with what we saw. It is a key driver of the big cruise lines are working with us by giving us the economy in Anglesey. What specific actions all the profiles of their vessels’ depths so that we can should the Government take to improve the support actually simulate those alongside at Holyhead. it provides for the development of ports, particularly Holyhead has very good potential to take any of the Holyhead, and what are the failings of Government cruise vessels that you have seen. policy currently? Mr Pinnington: I think so far as cruise is concerned, Q158 Hywel Williams: What is a dolphin? if I can start with that, the absolutely fundamental Ms Llewellyn: A dolphin is basically a very large necessity is to have an alongside berth for cruise piece of concrete which sits into the sea bed by which ships in the port. We have operated a number of the vessel’s lines are secured to it, so it does not mean years now with tendering out, with the cruise vessels that her stern or her bow moves around. Basically, anchoring oVshore. That has led to several that is what it is. You have already got one if you cancellations due to bad weather and is something look at Holyhead. There is a stern dolphin already in which clearly is not favoured by cruise lines. It is place which would be able to take the big bulk ships, becoming increasingly diYcult to persuade cruise but once you get over 300 metres then you will need lines to visit in those sorts of conditions, so the an additional dolphin to be built alongside. alongside berth is an absolute essential. I think perhaps in some respects Margaret is probably better Q159 Albert Owen: Just to continue on that theme of able to answer that question than I am because my additional investment required, do you feel that the involvement is much more on the onshore side, but Government is doing enough, moving quickly certainly I would say that the Council has a very enough, so that we do not lose out on the potential good working relationship with the port operator, market? Stena, and is looking to co-operate with them in Ms Llewellyn: Well, of course we lost a year really. If terms of a number of aspects of the development of we are really honest, Holyhead is the first port the port, for example the repair of the Holyhead probably in the UK which has worked totally as a breakwater, which is essential to the continued joint venture with Anglesey Aluminium, Stena as the operation of the marina, and certainly support from port, and the Welsh Assembly Government and the Government would be very welcome, likewise. Council. We work as a complete team and it is quite clear that without Anglesey Aluminium’s co- operation in allowing us to build their berth we Q157 Hywel Williams: We did visit Stockholm a could not have done this, because if we had started couple of weeks ago and saw an absolutely from scratch you would have been talking of a enormous cruise ship, huge, and we were told that minimum of probably £40 million. If you look at the they needed a certain meterage in order for that boat most successful cruise ports in the UK, at the to come in. moment the majority, if you think of Dover, Ms Llewellyn: Let me explain to you. It is not Harwich, Newcastle, are all government ports necessarily the length of the quay, it is the ability to because there is not the demand for profitability that secure the vessels. At the moment we are doing there is in private ports and therefore they are studies in Holyhead, including simulations of allowed to reinvest any profits they make into the Processed: 29-10-2009 19:51:07 Page Layout: COENEW [O] PPSysB Job: 435922 Unit: PAG4

Welsh Affairs Committee: Evidence Ev 35

30 June 2009 Ms Margaret Llewellyn and Mr Jon Pinnington facilities they require. We suVer from that, if you like, So the revenue earning potential of the cruise lines is in Wales because with Stena being a private very great if we can get them to come, but it is going company and with their core business not being to be for us to prove that we have the right oVering. cruise, it is very diYcult for them to justify. The real problem for cruise lines—and you have probably Q162 Albert Owen: On that point, you talked about learned this from your tour—is that once you get to the potential for the spend ashore. We have heard 30 or 40 vessels a year then of course you justify the that with large cruise liners the average passenger sort of capital investment that is required, and once spend can be as much as £100 per visit. Have you it is made it lasts for 50–100 years, but it is getting to done proper studies into this and can you tell us who that investment and you cannot get to that would benefit, both in the locality but also generally? investment other than by credibility. Of course, only Ms Llewellyn: There are various numbers thrown by us trialling diVerent sized vessels, learning how to out, and of course it depends on the quality of the handle diVerent size passenger numbers, can we do line, so we would say at the lower end, if you like, the that and actually get the cruise lines to accept what three-star vessels, you would be looking at about we are capable of doing, so that is our problem. £40–£45 per passenger spend, but if you go up to the very top quality, for instance, next year we have the Crystal Symphony coming in and she is a five-star Q160 Albert Owen: I think I am going to come on to plus vessel and £100 could be the lower end because that, but what I specifically need to know is, in they look for very specific tours on, for instance, relation to the joint venture you talk about, the stately homes where they will pay a lot of money. majority of the money will be coming from the They will go for helicopter tours. So they are at the public sector, coming via the Council or Assembly high end of that. Then the other part of the economic grants to modify the jetty to make it adaptable for development, which is what often people forget, is these larger vessels? that the crew goes ashore and usually about half of Ms Llewellyn: That is right, yes. Basically it is one the crew numbers on each vessel will go ashore and dolphin, what they call Yokohama fenders, which will shop. They look for their Tesco or their Aldi, are just these rubber fenders, a gangway and just they like Argos—they were all in Argos when we did improved dredging, and once that is done we can go the ship the other week—so there is this added value. ahead. But we have had to be a bit cute in the way Then, of course, you can sophisticate it outwards that we do it because it is a private port and because because if they will take stores, or food or drink, and of the issues of state aid. What we intend to do is, the even water, I mean the Seven Seas Voyager American cruise lines have agreed that in other ports purchases water oV Anglesey Aluminium when she in the world they have, if you like, a port calls, so there are a lot of economic benefits which are improvement tax—it can be a tax or a fee—whereby not just the obvious just for passengers. they charge a price per passenger, which can be levied so that that money can go back to the government. So in fact essentially one would hope Q163 Albert Owen: Has there been a localised study that we will have suYcient passengers to pay back all for these sorts of things? the money. Mr Pinnington: Yes, we did a study on the Princess visit, I think it was two years ago now, and there was a very wide variation from as little as £10 or £15, but Q161 Albert Owen: Just on that point, do you think over the top to £120 to £130, so clearly there is a Wales is currently attractive enough as a destination willingness to spend. I think where it goes depends, within the EU, and do you have any figures for by and large, on whether we are talking about tours advanced bookings over the next, say, three years? which are pre-booked, possibly on board, possibly Ms Llewellyn: Yes. We do not have the same image even before the crew starts. I think the best revenue, as Scotland and Ireland and I think that is one of our certainly for the immediate locality, is passengers hardest issues. Part of the reason why I became and there are increasing numbers of them who come involved and International Business Wales became oV the ship without any pre-booked tour or idea of involved was because we did not have an identity in what they want to do. They are looking for ideas, so the cruise market, as other parts of Great Britain did, it is part of our local role to be on the dockside to and so this has taken time and really we are only into advise them where to shop, to put on local our third year of that. Next year we have 10 vessels excursions, even if it is just to South Stack, half a booked for Holyhead and that will be our real mile or so up the road, to bring them back into the proving ground. That phase, which we call phase town centre so that they will spend money there. I two, where the largest vessel will be the Westerdam, think part of the development work which the which will take 2,500 passengers, which we intend to Council, with the Welsh Assembly Government, bring alongside, we will be judged in the industry by needs to do over the next few years is to give retail how we do it. It is interesting that with those vessels confidence in the locality so that increasing numbers which have come to Holyhead in the past, such as of crew and passengers will encourage local retailers Princess, they found that 88% of all passengers took to diversify their stock. That, in turn, will create a tours, so it was very comforting to the lines. Many of virtuous circle so there will be more spend on the them took half-day tours and then in the afternoons island. When Margaret talks about 10 ships being they would then go into town to visit the local area. booked, that is booked now. I think I am right in Processed: 29-10-2009 19:51:07 Page Layout: COENEW [E] PPSysB Job: 435922 Unit: PAG4

Ev 36 Welsh Affairs Committee: Evidence

30 June 2009 Ms Margaret Llewellyn and Mr Jon Pinnington saying that the smaller ships do tend to book later, Mr Pinnington: We do, yes. so we could still find 14 or 15 ships booked in total for Holyhead. Q168 Albert Owen: Oh, I will come and welcome Ms Llewellyn: But the economic impact of those 10 them myself! ships is roughly about £800,000. Mr Pinnington: You do indeed, yes.

Q164 Albert Owen: On those figures finally, if I may, Q169 Mrs James: I am very interested in looking at you said 10 next year, there could be more, but do developing the cruise market more widely in Wales you have any sort of advance projections beyond and you have talked quite extensively about that? Holyhead, for example, but on a Wales basis what Ms Llewellyn: We have already got our first ship do you think we need to do to enable cruise ships to booked for 2011 and we have two other indications. come, because there is a lot to oVer in South Wales as well, in Swansea, my constituency? Q165 Albert Owen: That is how the market works, it Mr Pinnington: Yes. is usually two years in advance? Ms Llewellyn: There is, yes, and in fact I was a Ms Llewellyn: Yes, it is, 18 months in advance they stevedore on a cruise ship in Swansea, so I am very partial to Swansea. Let me just explain to you that will start to indicate. If you like, what our V aspirations are, aspirationally by 2013 we would like whilst Cardi and Swansea are very attractive ports to see 30 ships per annum, and we do not think that for cruise lines, they have one problem and it is called the lock and the fact that there are some cruise lines is too aspirational because at Clydeport in Greenock which do not like entering locks because things can they already do 30 and Dublin does over 70, so I go wrong, the ship can get damaged going into the think we are not aiming too high. lock and there is a time element in it which they would prefer not to do if they had the choice. Having Q166 Chairman: How does that compare with, say, said that, I do believe that Swansea and CardiV do five years ago or 10 years ago? have a place in the cruise business and in fact the new Ms Llewellyn: Well, you see, the problem was that SilverSea vessel which is a five-star plus vessel, the when Princess came, in terms of passenger numbers, Silver Spirit, will be going to CardiV in 2010 along Princess came and anchored in Holyhead and with The World, ResidenSea, and I have been in provided the wind did not blow and they actually discussions with Seabourn for them to go to came you enjoyed quite a good revenue five years Swansea. I think it has to be a targeted market, it has ago. But then when Liverpool built its berth and they to be a certain size of vessel and we have to educate kept having to cancel their vessels, they decided they them far more in their experience of what they are would go to Liverpool instead, so all of the big going to see. With regard to Swansea, I think vessels which used to anchor in Holyhead have been Swansea in many ways could be marketed as a port for CardiV as well because it is very easy to get to lost. It is now up to us to start to generate people’s V confidence to come back. Cardi and yet it is much easier in terms of steaming to go into Swansea, it is an easier port to enter Mr Pinnington: There is no doubt that Liverpool marine-wise and also you can actually go in and out being the Capital of Culture in 2008 led to a lot of tidally much easier. So we are hopeful that we will be cruise lines wanting to be part of that and to take able to develop both ports, but you will only ever get, their cruise ships into Liverpool. I think it is also fair I believe, probably about 10 calls a year, but 10 calls to say that what cruise lines look for is variations in V in each of those ports would be excellent. their o er, so I have no doubt at all—and certainly Mr Pinnington: Anglesey is leading on a European it is part of the work which the Council does with funding bid under the INTERREG Programme Cruise Wales to meet with cruise line representatives called Celtic Wave and there are six ports involved in in the sea trade conferences, which are sort of the that, Swansea, Milford Haven and Anglesey on the marriage bureaux of the destinations with the Welsh side and Cork, Waterford and Dublin on the lines—here is a huge interest in Holyhead from a Irish side. The whole purpose of that Celtic Wave wide range of cruise lines, not just the more budget project is to develop an Irish Sea brand to work end but the luxury end as well, and that is a market together, to co-operate, to market the whole of the we are very keen to tap into. I think the challenge Irish Sea as one cultural experience, if you like, or a then is, if we do go up to 30 cruise lines a year, and number of cultural experiences within the overall one thing that Anglesey and Wales is very good at at brand. the moment is giving them a really good onshore welcome, possibly being met with a local choir, food taster sessions, all sorts of things laid on, plus mobile Q170 Mrs James: Similar to the Baltic. tourist information, and so on. That needs to Mr Pinnington: Yes. continue because I think that is part of our edge, the Ms Llewellyn: Exactly! We want to be the next quality of the welcome that we give, and that is a real Baltic. That is our ambition. challenge if we go up from 10 to 30 ships a year. Mr Pinnington: That is very exciting because we have just had funding approval for that, so the project is underway now and the next big marketing Q167 Chairman: Do you have the support of your event I think is called Seatrade Med but it is actually Member of Parliament? being held in Hamburg— Processed: 29-10-2009 19:51:07 Page Layout: COENEW [O] PPSysB Job: 435922 Unit: PAG4

Welsh Affairs Committee: Evidence Ev 37

30 June 2009 Ms Margaret Llewellyn and Mr Jon Pinnington

Ms Llewellyn: No, it is the northern one, Seatrade of the diVerent lines. If you look at Seabourn, for North. Swansea I think they are very suitable because half Mr Pinnington: I beg your pardon, Seatrade North, of their passengers—you are only talking about in Hamburg in September/October. 250–300—never take tours, they like to explore on Ms Llewellyn: September, yes. their own. Now, a place like Swansea has a lot to Mr Pinnington: And the Celtic Wave project will be oVer. We could create walking tours or shuttle bus there marketing the six ports and the Irish Sea tours. So I think this is where we need to refine it programme. specifically for diVerent markets. Mr Pinnington: If I can add to that, it is all about thinking it through from the customer perspective. Q171 Mrs James: Well, the MP for Swansea East is So you imagine them coming down the gangplank pretty happy to come along! and once they are on dry land they are yours, as it Ms Llewellyn: The good thing about that is that were. They need to be safe, so if they are looking for Waterford, of course, is a similar size of port but an their coaches for their booked tours, or whatever it established cruise port, so we hope they will share is—and with a large ship you might have 30 coaches their ideas and connections to help Swansea and turning up—they have to find the right coaches, they V Cardi . If we touch on Milford, because we should are leaving and they have to be, as I say, safe at all not forget Milford Haven, Milford Haven has the times. The independent explorers (as they are known potential, of course, to have an alongside berth, but in the trade), the people with no pre-booked it will not be cheap. It will probably be the destination are coming oV looking for information. Blackbridge site, as I see it, as part of a general cargo, I think there is research which shows that the average general user, in fact almost a new port within age of cruise passengers is getting younger and Milford Haven, and the land is owned by younger. Two or three years ago it was 49 and it is Pembrokeshire Council. It will be a big project now down to 46, so there is a diVerent mix in the moving forward, but there is potential there to do it. market that needs to be created, more activity tours, diVerent interests in culture and heritage, and so on. Q172 Mrs James: Just a few more questions. For the So there needs to be visitor information close at record now, because obviously it will be very helpful hand, taxis for those who want to take taxis, car hire. for us, what are the basic facilities you think all these There is a range of provision that needs to be V ports need? What size ships, what size vessels do you onshore as well as o shore and, as I say, it is think they can accommodate? There are diVerent important to view it from the customer perspective sizes of cruise ships. We obviously saw them in the and, as always, to provide the right quality and meet Baltics. I think it was the Emerald Isle we saw in the customer expectations. Stockholm and it was huge, 3,500 passengers. Could we be that aspirational? We have already talked Q173 Mrs James: The SA is one way in particular about opportunities in Holyhead but really what are now leading straight into the city, so there is ample the minimums and maximums? What sort of opportunity for that. resources do we need? What do we need to provide Ms Llewellyn: Yes. these ships with? Ms Llewellyn: In CardiV and Swansea you are talking round about 25,000 tonnes, passenger Q174 Hywel Williams: Can I ask you a little bit numbers about 750, you might get up to 950, but about the partnership in Anglesey but also that is the sort of size. Actually, to be honest, in throughout Wales. Firstly, just looking at the Swansea if you dress up one of the warehouses that funding, can you explain a little bit more about how you have and you open up the gates into the new the funding works because you said that the SA1 area you have got a very nice operation for government-owned ports in England do not have relatively little spending actually, because the beauty the same problems as private ports in Wales, so how of Swansea as I see it in the long term is that the was that sorted? cruise will be part of the regeneration of Swansea. If Ms Llewellyn: It is really to do with trust ports and you think about a walking tour from when they get in fact Milford Haven is a trust port, so if they only oV the ship around the Maritime Museum, and I made a profit, which they do not or they make very have been in discussions with the Council about little, but if they were a profitable port—I do not perhaps having shuttle buses with diVerent stops on know whether you know my background, but I was the way for them to be able to get into the area, I Deputy Chairman of Dover and Dover, if you look think Swansea for the right type of market could be at it 30 years ago, was not a cruise port, so much of very, very attractive. For instance, Seabourn are the the profit which was taken, if you like, from the ferry well-travelled, well-heeled end of the market and this business, when it was decided that we would develop is something that we have done, to answer one of into cruise then we were able to use that money to Albert’s questions. Every time I see a line I ask them develop into the cruise business. Now, if you took it to profile their market in terms of the age group and as a commercial basis, of course you would not get the types of tours they like. If you have got young 8% or 10% return on the capital investment. You people obviously they like to do cycle tours. What cannot, because when you are starting oV you do not we are trying to do as part of Cruise Wales and the know how many vessels are going to come. So if you Celtic Wave is to work the tours to meet the market are a quasi-government organisation you are much Processed: 29-10-2009 19:51:07 Page Layout: COENEW [E] PPSysB Job: 435922 Unit: PAG4

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30 June 2009 Ms Margaret Llewellyn and Mr Jon Pinnington freer to do those things than you are if you are a there.” That is not how it works and I am sure that private organisation. For instance, Stena would not Matt will tell you that as a customer he does not do that in their own right and we are just very come to Wales as much as we would like him to fortunate in Holyhead that there is this berth. But to because the facilities have not been available for be fair, Stena and Anglesey Aluminium are not him. looking for a commercial return at all. At the moment they are prepared to try and develop it, if Q177 Albert Owen: Just on the port group, do you you like, for the community and it will not be really think local authorities and Cruise Wales will have a until we get to about 30 vessels that they will see any positive input or do you think the port operators will commercial return on the work they are doing. In dominate? fact, I think at the moment it has probably cost Ms Llewellyn: I think it depends on the port Anglesey Aluminium about £100,000 to actually do operator, to be honest. We are hoping, actually, that what we are doing, but it is superb that they have by showing the model of Holyhead and also by them been prepared to work with us. working with the Irish ports—because the Irish ports are very supportive, they have been there and done that 10 years ago, so we can learn a lot from Q175 Hywel Williams: So it is that model of them. They can introduce us to the right lines. They partnership and looking to the longer term than can show us how not to over-invest and over- would usually be the case in commercial conditions? engineer facilities. I think this is an area where we Is that applicable elsewhere, say in Milford Haven or will learn by our Celtic Wave initiative and hopefully in Swansea ? it will teach some of the ports that working in Ms Llewellyn: Yes. I think you have a problem with partnership is much more successful than trying to Milford Haven, I will be honest with you. I think it take the line themselves. is absolutely appalling that it does not make the sort of returns it should make for the type of throughput Q178 Hywel Williams: In Caernarfon does the and tonnage that you do. If you only got it to give partnership extend over the— you proper commercial returns, let me say to you Ms Llewellyn: Yes, it does, and in fact we are hopeful that I was on the board of Dover for nine years and that the Hebridean Princess will be coming to when I joined Dover we were sort of nice to the Caernarfon. There is this little berth which you have community and we did not really make any profit, and she does not want to go to Holyhead because but in time we became more commercially viable, they are very high end, as you know, and they pay which actually benefits the community because about £8,000 for a week’s holiday and they have when you do that it allows you to invest and Dover asked and we have been in discussions with the now has two big cruise terminals and this year I harbourmaster there, and hopefully she will then sail think it has got 155 vessels. You would not have been on to Fishguard, Pembroke and then into Swansea. able to have done that without having the right So that is earmarked for next year as a Welsh cruise. format of port to be profitable. There are issues, I Normally, as you know, they are up in Scotland but think, in Milford because it does not perform as it they are venturing down into Wales for one cruise. V should do as a port. It is not a secret. I am blunt Mr Pinnington: I would give a slightly di erent about it because I just think it is disgraceful. To give answer to that question in the sense that on the you an idea, the LNG does not have any minimum marketing and fulfilment side now, in other words tonnage guarantees. How you can have a port of the softer onshore side, it is very much Anglesey led. that calibre with the sort of investment which has We have the regional tourism partnership, tourism gone on without any minimum tonnage guarantee is partnership North Wales, who draw down money from Visit Wales, the national body, and they put I beyond me. I just think that something needs to be think it is on average about £30,000 into Anglesey to done. It has huge potential but it is not managed support that side of the business. In terms of the correctly. local authorities, we have been talking for some years with Gwynedd and Conwy in particular, and Snowdonia National Park, about having a greater Q176 Albert Owen: The oral evidence and the partnership operation. We are only just really written evidence we have had from other witnesses waking them up, I think it is fair to say. talk about the Welsh Assembly setting up a port Ms Llewellyn: They are not very good and they do group within the Assembly. Do you think that is the not really understand what the potential is. In fact I kind of vehicle which is needed to have a strategy for oVered two weeks ago to actually sit down with them the whole of Wales? to try and educate them, but so far we have not Ms Llewellyn: Yes. We are diVerent, actually, to the managed to get a meeting. So anything you can do, Department for Transport, because I went to see now that you have seen how other people operate, them and they do not have any port strategy. I said, because they have as much to benefit, as you “Well, I’m sorry, but we have to have that in Wales appreciate, than Anglesey. because it so happens that certain ships will not fit Mr Pinnington: Just as an illustration of that, the last into certain ports and certain cruise lines will not cruise ship we had in, the Seven Seas Voyager,we come to those ports, so you cannot go in hope, which had, I think, 500 people come up. It was a fairly is how you have approached it before, hoping that small visit. Four coach tours left the dockside. One somehow somebody will turn up just because we are went to Bodnant Gardens in Conwy, one went to Processed: 29-10-2009 19:51:07 Page Layout: COENEW [O] PPSysB Job: 435922 Unit: PAG4

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Snowdonia, one went to Caernarfon Castle and one an example, Princess Cruises were very, very good in went to Beaumaris, so in terms of Anglesey’s input coming to Holyhead two, three years running, I we got one out of four. I know we have local trade as think with two or three ships a year, and then in 2008 well and that is clearly very beneficial to us, but it they said, “We’re very sorry, we’re going to does spread the benefit much wider than just the Liverpool because it’s a special year, the Capital of island of Anglesey. Culture,” but we know they will be back, particularly if we have the alongside berth, and I Q179 Hywel Williams: I was concerned when you think that is the nature of the business and the nature said about Holyhead losing trade to Liverpool. Is of the relationship which we as destinations need to there anything in particular that attracted them to build up with the cruise representatives. It is a long- Liverpool in the way that they provide a terminal term relationship we need to have. and facilities? Ms Llewellyn: Well, it is the alongside berths. At the Q181 Chairman: You have had a number of very end of the day, you know, the real issue is if you go enthusiastic questions and I am taking advantage of to anchorage—and Milford Haven has the same the Chair here by asking you about Port Talbot and V issue—and the weather changes or if you have got its deep water harbour. We have heard about Cardi elderly passengers, there are always health and safety and Swansea, but have you ever considered docking risks of putting people into tenders. It is not an at Port Talbot? attractive option. In fact, some of the newer cruise Ms Llewellyn: I have definitely considered it, ships, for instance the Independence of the Seas,do because of course it could take the Queen Mary, and not have tenders so they will never be able to come I have spoken to ABP about it because there is a lay- to a port which is just an anchorage. When a vessel by berth in Port Talbot and of course people always is at anchorage the master or the mate has to stay on say, “Ah, but it’s an industrial port.” Well, so is the bridge for the whole time, all the crew are having Anglesey Aluminium, although you do not see it and to work with the tender operations. It is a very actually,to be fair to Neath and Port Talbot Council, intensive operation, so if people have an option they they have always been very supportive and said that will choose to go in an alongside berth. As we also they would even organise tours of the steel works. say, Liverpool and Holyhead are so diVerent that The issue is, of course, that ABP, I think, are quite actually in terms of, if you like, an Irish Sea cruise reluctant to consider it. I have spoken to one of the experience you can oVer both, as we say. Even if you main board members, who happens to run look at Pembroke, Swansea and CardiV, they are Southampton, and he has not said no to doing it. To very, very diVerent areas which we can sell in one be quite honest, it would be the natural port to cruise actually. There was a ship last year, the Spirit develop if you were starting again in that area of Adventure—and she is doing it next year again— because, of course, you can take any size vessel. That that did a garden-themed cruise for gardens and is where we get the policy between the Port went all the way around Wales and Ireland. So these Authority and the ambitions, if you like, of Wales. are the sorts of areas we can look at for the future. Q182 Chairman: Could I thank you for that answer. We will certainly write to ABP giving that evidence Q180 Hywel Williams: Is there anything about the you have just provided. I think it is an excellent idea partnership in Liverpool, the way they have for you to think about tours of the steel works, but developed alongside facilities, anything in particular also we have the beautiful Elan Valley and Margam that we would want to learn from that for Wales? Country Park and we are actually nearer to the Ms Llewellyn: Well, the council paid for the Beacons then Swansea is. investment from what I can understand. I do not Ms Llewellyn: Exactly. Actually, joking aside, eight know about it, you can ask them, but I understand people went on a tour of Anglesey Aluminium at the that was the council. Yes, if Pembrokeshire Council last tour and they loved it because they were pilots would like to build at Blackbridge in Milford Haven for American airlines, so they flew aluminium then I am sure we would all be happy, but I do not planes, so they wanted to see it, and they asked if think they would be prepared to do that. I think they they could pay! Obviously it was done free of charge, are prepared to enter into a joint venture, even if it but it shows the potential in industrial heritage would be an infrastructure fund, and the Milford tours. Haven Port Authority, but only as partners because Chairman: I would love to continue this dialogue, of the huge investment involved. but we have other witnesses. Could I thank you for Mr Pinnington: I think we have to accept that the your written evidence and your oral evidence this cruise lines will want to see their brochures look morning, and thank you for your vision and your fresh, new and diVerent every year, so again to quote enthusiasm.

Witnesses: Mr Matt Grimes, Director, Planning, Ports and Logistics, Fred Olsen Cruises, and Mr Keith Blundell, Head of Tourism, City of Liverpool, gave evidence.

Q183 Chairman: Welcome and good morning. Mr Grimes: Certainly. My name is Matt Grimes and Could you introduce yourselves for the record, I am Director of Planning, Ports and Logistics for please. Fred Olsen Cruise Lines. Processed: 29-10-2009 19:51:07 Page Layout: COENEW [E] PPSysB Job: 435922 Unit: PAG4

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Mr Blundell: I am Keith Blundell. I am the Head of Q186 Mark Williams: Where does that Tourism for Liverpool City Council. responsibility lie for that early information? Mr Grimes: It lies with the ports, I would say. We do not have the resources as a company to investigate Q184 Mark Williams: I would like to hear a bit more every potential port that we might call to. We call to from witnesses about the size of the UK market and something like 370 ports a year across the five ships the potential for the growth in that market. in the fleet, so we are hard pressed to service the Certainly in the figures you supplied to the needs of the ports we are already calling at, let alone V Committee from 2007 to 2009—there is a tail-o in research and develop in partnership with new 2010 so far as Liverpool is concerned, but they destinations. nonetheless represent a really big growth in the Mr Blundell: I concur. That was one of the things we market both in terms of vessels and passengers and tried to do, particularly with the lines which were the economic impact. Can you tell us a bit more already calling to the Mersey, in particular with about the UK perspective, please? Carnival UK. When we were at the early stages of Mr Grimes: Yes. Speaking for Olsen, we have grown design we entered into consultation with them, either our capacity by 40% in the last 12 months, so we now directly or through our committed design teams to have 40% more lower berths than we did a year ago. make sure that all the building was fit for purpose That is an unusually large growth in a short period of and adequate for what we were doing. Matt is time, but nonetheless over the last 10 years the cruise absolutely right. When one is considering any kind industry in the UK has been growing at a very of development it always pays to talk to the healthy, strong rate, I think at around about 15% per customer and that was what we tried to do, and so year. That growth is also true not only of the UK far it seems to have paid oV. market but also of our North American counterparts, where we continue to see more new Q187 Albert Owen: What facilities do you think the ships launched every year and those new ships, of V course, are larger in size than the previous ships. So cruise terminal at Liverpool o ers visiting vessels? cruising is a very strong growth sector of the travel You must have got something right to have the industry at present. numbers exceeding your expectation? Mr Blundell: Well, it is actually relatively simple. It Mr Blundell: I have really very little to add to what is 250 metres of floating concrete with two Matt has said. Using the annual survey which is dolphins—and you now know what dolphins are, conducted by, amongst other things, the Shipping and I did not know what dolphins were either—and Association, last year’s growth was somewhere in that extends to 350 metres with suYcient draft to the region of 23% between 2007 and 2008, so there is enable us to take the Queen Mary II, which was our a lot of growth and one of the things when we started specification. We have a small passenger handling looking at this some nine years ago now is that we facility which for the opening of that we got 200 can see the growth pattern had been established for people in there, but I think comfortably you would a number of years. You can also see from the cruise want about 120, it is not very big, and the supporting line’s own data that customer satisfaction and repeat infrastructure in the river, so we have got a vehicle visits are very, very high. So there was a very sort of link span and two pedestrian link spans, a relatively self-sustaining growth. We are obviously in diYcult simple but rather expensive piece of equipment. The economic times at the moment. Notwithstanding other keys to it are obviously having the right people that, I think there will still be perhaps marginal and having a decent range of shore excursions. It was growth this year and the cruise industry is very, very touched on in the earlier session that the range and well placed for when we come out of this recession. quality of the shore excursions is very, very important to the cruise lines. They make a lot of money from those, so the ability to have variety is Q185 Mark Williams: Obviously your marketing very attractive to them when they are making has been enhanced significantly, in the development decisions as to where they are going to deploy their in Liverpool particularly, but is that also a reflection vessels. That is another one. I think the other thing on a more strategic approach to the development of which tends to get forgotten and we, to be honest, the kind of partnerships you will have heard in the did not manage it particularly well in year one but we earlier evidence session in terms of public bodies and have improved significantly this year, is the the companies themselves working together to supporting shore-side infrastructure. Where are you develop the potential? going to put 50 coaches and how are you going to Mr Grimes: Yes, as a cruise line we would greatly manage the flow of 50 coaches in the middle of the encourage a dialogue between all parties concerned, rush hour in a city the size of Liverpool, and things particularly in the early stages with the cruise line. So like that. It was an interesting challenge last year, but many times around the world we hear about a new we have got over that for this year and next year. facility just after it has been built and we go and see Those are the physical things. I think it was touched it and find they have spent far too much money on on again by Jon from Anglesey, the human factor the wrong things, facilities that we will not use to that then kicks in. We have got a very good team. their full potential, simply because we have no need Angie Redhead is in my team as Cruise Manager and for them. So this is very encouraging to be invited has proved very good at building relationships, along today at the early stages to be able to put building trust and reliability because we were on the forward the list of requirements needed. back foot. We had been talking about this thing for Processed: 29-10-2009 19:51:07 Page Layout: COENEW [O] PPSysB Job: 435922 Unit: PAG4

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30 June 2009 Mr Matt Grimes and Mr Keith Blundell a long time and it eventually arrived in 2007, and we Mr Blundell: I think it was a help. I think it was had been really talking about it properly since 2005, probably more of a help in terms of the construction so people knew it was coming, so there is that issue phase and the deadline. We opened in September in terms of trust and confidence because you are 2007. I think it was one of those things that the city dealing with a small marketplace. Your customer was conscious it had to have in place for 2008. I am base is about 50 people, and the decision-makers not convinced it was absolutely critical in terms of probably no more than 30, so you have got the the deployment decisions we got last year, although opportunity to build very strong relationships with obviously you have heard slightly diVerently from those people and that was important. Secondly, Anglesey. We did not get that information from Princess has been mentioned. We, through training Princess, it was more about the ability to come programmes and a general kind of local warmth and alongside and the other oVer, but I am absolutely friendliness, have been able to record extremely high certain that it provided a deadline for the satisfaction scores. Princess are our biggest construction so it was important in that regard. customer. We were sixth in Europe on their customer satisfaction ratings last year and we are targeting a Q190 Albert Owen: A final question. You mentioned slight percentage increase in that for this year. The a few challenges, the logistics of getting coaches, et other key influences are in terms of redeployment. cetera. Has that been resolved? Secondly, something What did our passengers think of this port is we saw in Stockholm in particular. They were extremely important for the cruise lines. I think that building on the dockside tents, marquees and probably covers it. everything for events and permanent structures. Is that something you see developing in the future? You mentioned people visiting the vessels, but when the Q188 Albert Owen: So those using the facility are vessels are not there can that area be used for events happy with it. What benefits has the surrounding throughout the year? area got, because you had quite a wide partnership Mr Blundell: Do you mean the pontoons? in developing the new berth and obviously they did not want to see people just shipped oV the quay or V Q191 Albert Owen: No, I mean they actually have people joining a vessel and coming o a vessel. So purpose-built holding bays, if you like, for people what has the benefit been in economic terms to the when they were coming oV the vessels in adverse surrounding area? weather. When they saw these were such a success Mr Blundell: We estimate by the end of this year we they were using them for concerts and various will have had about £40 million worth of gross events. expenditure and that is based on passengers, crew Mr Blundell: But there are two things about where and spectators to the vessels. The majority of we are. One is that we are located right up against the funding came from the Regional Development pier head, so we are right in the city centre, so there Agency and it came from the North West is a lot of that kind of thing right in the city anyway. Development Agency and we promote the facility as There is the Arena and all the other stuV. Secondly, the cruise gateway to the North West, so excursions obviously the land values. We are attached to private are oVered to the Lake District, Cheshire, land by and large in the ownership of Peel Holdings Manchester, Lancashire and North Wales. Chester and the land values they are seeking to generate from and North Wales is a very common excursion from that development land do not really fit with those Liverpool. So we promote it on that basis to try and kinds of uses. They are looking more at commercial, maximise the revenue. It is always a balance. The line residential, hotels, that kind of thing, so it is not would prefer to sell more excursions and have more really something we would consider. What we have people coming ashore; the RDA would prefer to been able to do—and again it was something we did have a lot of excursions going in the diVerent not really look for—is we have become a very regions. As the local authority, we would prefer to successful port of call for the Royal Navy and the have as many people as possible staying in the city, Navy are now talking about using Liverpool as a so we have a balance, we have a tightrope to walk, base for major Naval events. There is an event in which we do reasonably well. What we are finding is October this year, Fly Navy 100, the centenary of the that because of the strength of what is available Royal Navy starting to fly because, as they keep on locally we are getting a lot of half-day excursion telling us, they were flying before the RAF. So that bookings and then people going back to the city in is their big thing and they are coming to Liverpool to the afternoon, so that keeps most people happy. do that.

Q192 Albert Owen: Just on the challenges, you Q189 Albert Owen: How important do you think the mentioned, as I said, the logistics of getting coaches City of Culture status was in getting the new berth? in there. Were there any other problems you had to Was that something that you were selling? overcome? Mr Grimes: For us with predominantly British Mr Blundell: Yes. I do not know how familiar you all passengers it did not feature in our itinerary are with the pier head area. We share the sort of planning thought process. However, having pontoon family, if you like, with the Isle of Man previously worked for American lines I can see that Steam Packet Company, which runs a twice daily, that would have been a great pull for the foreign sometimes daily service to the Isle of Man, so we passengers. have a bit of that and we have issues around Processed: 29-10-2009 19:51:07 Page Layout: COENEW [E] PPSysB Job: 435922 Unit: PAG4

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TRANSEC and restricted areas, they shut bits down five-year period and in the same amount of time we and let bits oV and things like that, which we had to called six times, I believe, to Wales. What that work through last year and we have now got demonstrates is that our ships are sailing right past solutions in place through negotiations with Wales on a regular basis and it is purely the lack of TRANSEC where the cruise passengers are not facility that prevents us from calling. inconvenienced. I have mentioned the transport. We have actually been pretty successful overall. I think it has gone very well. Those are the key issues for us: Q195 Mrs James: You have talked about the tours one, the land side and the shore side; two, actually and obviously the range of tours available at the port managing the spectators, the volume of spectators was very important. What I am not clear about is, and the demand for the Royal Navy visits was what is the travel distance? What is the maximum something which, again outstripped ours and the travelling distance from that port that people are Navy’s expectations. The first time Ark Royal came prepared to take? in we had 50,000 people come and look and 9,000 on Mr Grimes: It is not uncommon for a full-day tour, the ship. It is the most successful ever visit. Somehow which will last between eight and 10 hours, to have or other we kind of touched something in the Scouse at least two hours of travelling either way. For psyche and all these people appeared from nowhere example, we operate a tour from Warnemunde in to try and get on the ship, so we had a little bit of ex Germany to Berlin and the transfer to Berlin is two post facto event planning to deal with, which we have and a half hours each way.So clearly if the attraction now got in place as we are now heading towards the is strong enough passengers are more than happy to end of our second— make the journey. Typically, though, what works best, as Keith has spoken about, is half-day tours where a passenger can go oV at 8.39 in the morning, Q193 Albert Owen: That is the ex-seafarer saying, “I come back to the ship for lunch—that is always very used to work on a liner, can I come in and look?” important for a cruise passenger!—and then in the Mr Blundell: Yes. If it was Ark Royal, you see, it was, afternoon they can wander ashore independently to “My grandad was a welder at Laird’s,” and with invariably buy souvenirs, or postcards, or just to Cunard it is always, “My grandad was a steward,” or take in the local surroundings. So an ideal tour a stoker. The Cunard vessels in particular tend to would be four hours long with roughly half an hour drag them out. We had 60,000 for the opening event transfer each way. and probably as many again on the Wirral side. I think that is the other impact which you cannot really put in writing, but the sort of demonstration Q196 Mrs James: The beauty of Wales obviously is eVect, local confidence, that feeling of regeneration that within an hour or half an hour of any of our really happening, as a symbol of regeneration. There ports you can be in very, very diVerent places. There is a lot of extraordinary things have happened in is an immediacy in Wales, we are quite compact and Liverpool in the last eight years, shopping centres, there are lots of diVerent places you can go to. arenas, this, that and the other, and actually just to Mr Grimes: Yes, certainly as a cruise line we see the big white ships floating there is enormously recognise Wales as being a “must see” destination. It important to our local population. It is one of the is just that we do not have the means to be able to get reasons why it is the City Council that is doing it. the ships in there. That is the great shame. Albert Owen: That is interesting. Thank you.

Q194 Mrs James: I have got two questions to go Q197 Mrs James: The other thing you talked about through with you but my main question is on your and Mr Blundell talked about quite eloquently was evidence about the key factors as to what you, as the welcome and the farewell. My mother was a great cruise fanatic and I remember going to cruise operators, consider essential and what should V form part of the cruise oVer. To what extent do you Southampton on several occasions to see o her think the Welsh ports can oVer these facilities? cruise ships and there was a great excitement, with a Mr Grimes: Currently in terms of the alongside band playing and lots of streamers, et cetera. Why facility, the actual physical tying up and securing of are you talking about the welcome and the farewell? the ship, very little. Ports like CardiV and Swansea What exactly does that entail? have adequate facilities once we can get into the port Mr Grimes: You have to view the cruise experience but, as Margaret alluded to, because they are entered through the eyes of the passenger. For some cruisers through locks that brings with it certain it is a once-in-a-lifetime holiday. It will be the only disadvantages, namely timing, as we can only enter time they walk down the gangway. We do not have and leave at various states of the tide, and also the gangplanks any more, I hasten to add. So when you weather. It is not unknown for ships to enter step onto the shore you want it to be a memorable successfully and then be stuck in port for a number occasion which will stay with you for ever. Now, that of days waiting for the weather to abate so that they can be something grand like a marching band or it can leave again. Therefore, we approach locked can be quite simply the town crier, for example, ports with some trepidation, almost as much as shaking your hand and saying welcome. What tendered ports in fact, as we can not really rely on the constitutes a great welcome is down to the individual weather being right on the right day to execute the and we recognise that ports cannot sustain a call. I think if you look at the evidence I gave, I prolonged programme of providing marching bands quoted a figure of, I think, 53 calls to Dublin over a and a great hoorah and fire tugs and everything else, Processed: 29-10-2009 19:51:07 Page Layout: COENEW [O] PPSysB Job: 435922 Unit: PAG4

Welsh Affairs Committee: Evidence Ev 43

30 June 2009 Mr Matt Grimes and Mr Keith Blundell but often it can come down to the demeanour with any buildings or structures on the quayside. It is only which the people ashore greet and farewell the when you go down the road of turnarounds that you passengers. really need to invest in some infrastructure in terms of buildings and facilities. To put that into perspective, here in the UK we really have two major Q198 Mrs James: But you consider those to be quite cruise ports in terms of turnaround, Southampton essential and you would work with the local and Dover, and whilst our company uses a great authority and the tourism people? number of smaller ports around the country they Mr Grimes: Yes. I think from the passenger represent a very tiny amount of turnarounds, perspective the most essential ingredient is that the whereas most of the business in those other ports are community in the port wants the cruise ships to transit calls. So to chase after turnaround calls is come, because if the community are not behind the probably the wrong direction for Wales, it is the visiting cruise ship then you will not get the visiting cruise ships, and I think, from my company’s spectators coming to the port, you will not get the perspective, we would be most interested in that sort taxi drivers turning up, you will not have the street of facility. vendors or street performers, people coming down to chance their luck and try and sell something. So it is really important that the communities are behind Q200 Hywel Williams: I thought that was what you these calls. I understand you went to Stockholm The were going to say. In Holyhead, of course, there is a community does not need to be behind a call to terminal there which serves the Irish ferries. Is there Stockholm because it is a major city and it is well- the potential for that being developed so that people established, but if you are a burgeoning cruise port could board at Holyhead rather than just calling for which is trying to get oV the ground you really need the day? everyone in the vicinity to be behind it, not just the Mr Grimes: The port tells me so, but I have yet to port authority but the community themselves. visit the facility. I would say that we operate from Mr Blundell: I would concur with that. One of the Newcastle, though, from a ferry terminal and also things we put a great deal of eVort into—and again from Rosyth from a ferry terminal, so clearly there partly it is down to the skills of the people we is some potential there, but of course you need the recruited who have got a sort of resort management market living around the Holyhead area to draw on background from the private sector—is we put to fill a ship of 400, 500, 600 passengers. together not just the organised shore excursions but for the passengers who come ashore on their own there is always a range of bespoke oVers or incentives. It does not have to be about the expense, Q201 Mark Williams: I also want to ask you about it could be about the bespoke experiences and infrastructure and facilities and why in your exclusive experiences so that there is that genuine memorandum you had highlighted the feeling from their point of view that Liverpool is disproportionate number of calls in Wales as welcoming them, it is rolling out the red carpet, it is opposed to the UK but you have talked about the making a special eVort. The businesses have been weather and the geography. I was going to ask you extraordinarily supportive for the reasons we have who is responsible for that, but I will not go down gone into in the previous session. These people do that line! But you did talk about—and again you spend and spend well, so we have been pushing at an have just alluded to it—if there were facilities open door but it was down to us to co-ordinate that. available at the right cost you would be prepared to look at both turnaround and transit visits in more depth. Again, the question of responsibility for that. Q199 Hywel Williams: Just one question, I think to What would be the stimulus in a Welsh context for Mr Grimes. You said that some ports had spend that to happen? money on matters they really did not need to spend Mr Grimes: I will give you an actual example. ADP that money on things you told them you do not need. CardiV approached me with a view to operating What sorts of things were they putting in that were turnarounds in their port, so I went up and we had not needed then? a look and a good chat. Currently, we do not believe Mr Grimes: I think there is a perception in some there is a suitable facility there, but clearly the onus areas of the world that if you want to attract a cruise lies with the port to approach the cruise line, as ship you need to build a terminal, and that is not the Holyhead have now done with respect to case. In my written evidence I have made the turnarounds there. Fred Olsen believes there is distinction between turnaround calls and transit potential to operate a limited turnaround calls and the vast majority of our calls, of course, are programme in Wales—and by “limited“ I mean two transit calls where we just come in for the day, the or three turnarounds a year—but we believe there is customers go on tour, and we sail away again. In a greater potential for transit calls exceeding that order to achieve a facility for a transit call you number, perhaps five, six, seven calls a year across literally need to be able to tie the ship up securely but our fleet. you do not need a berth that is as long as the ship— Chairman: Could I thank you both for your evidence we all know about dolphins now—you just need a today and your earlier written evidence. It has been safe means to secure the ship, and you do not need most illuminating and Wales will benefit enormously Processed: 29-10-2009 19:51:07 Page Layout: COENEW [E] PPSysB Job: 435922 Unit: PAG4

Ev 44 Welsh Affairs Committee: Evidence

30 June 2009 Mr Matt Grimes and Mr Keith Blundell from your evidence, I hope, and we look forward to all witnesses today—we would be very pleased to including it in our final report. If you feel that we receive a further memorandum from you. Thank have not covered any points—and I have said this to you very much.

Witnesses: Mr Paddy Walsh, UK Ports Manager, Irish Ferries, and Mr Tim Reardon, Chamber of Shipping, representing Stena Line, gave evidence.

Q202 Chairman: Good morning and welcome to the of North Wales Police is there in strength, I think 55 Welsh AVairs Committee. For the record, could you oYcers based in the port with further oYcers introduce yourselves, please. supporting them in headquarters in Colwyn Bay, 14 Mr Walsh: I am Paddy Walsh. I am the UK Ports oYcers based at Fishguard and also covering Manager for Irish Ferries responsible for our Pembroke in the south—a significant deployment, operations in Holyhead and Pembroke Dock. much bigger, for example, than you would find on Mr Reardon: I am Tim Reardon. I am Passenger the English Channel ports—supplemented by Issues Manager at the Chamber of Shipping, the deployment from the UK Border Agency. trade association for the UK shipping industry. I am Historically that has been a Customs intervention here today on behalf of Stena Line. rather than an immigration service. The two are now being combined statutorily under the Borders Bill, Q203 Chairman: Mr Walsh, could I begin with you? but they have got about 18 personnel, I believe, You mention in your evidence that “decisions made based up in Anglesey with others coming in from by Governments can have a disproportionate Manchester Airport and elsewhere for targeted impact on trade”. Could you tell us how have operations every now and again. On top of that you investments in links to and from the ports in West have the port security staV who are employed by the Wales aVected trade patterns? port as well, 40-odd up in Holyhead, and again that Mr Walsh: It was not specifically investments, is replicated down south, each looking at particular Chairman, it was more in the context of the changes diVerent areas of interest; Special Branch clearly on 1 January 1993 when the full EU status was looking at counter-terrorist operations and seeing achieved and the customs borders were removed. who is coming to and from the Irish Republic. They That was a positive and beneficial impact for ports keep a monitoring brief over all traYc. Every time I in Wales. It enabled us to compete on more of a level have passed through Holyhead there have been a footing with the Northern Ireland ports which had couple of policemen there keeping an eye. They have enjoyed the lion’s share of the business. Prior to that, full power, and occasionally exercise it, to require for reasons of expediency, border controls were such those embarking or disembarking to complete a that if there was no issue over terrorism, shall we say, landing card so that there is a record kept of when associated with the movement of vehicles, the they pass through. The UK Border Agency is there statistical side and the paperwork side was given doing its targeted anti-smuggling controls and much more expediency than it would have been at periodic passport controls and the port’s own the ports. At the ports the statistical and revenue security personnel are there essentially to look after checks and examination of vehicles would take the security of the site and the security of the ship. place, so it was common knowledge in the industry Their role is to undertake random searches of that it was a faster clearance in transit time by the vehicles entering the terminal, passengers entering Irish land boundary, so the decision made by UK the terminal—to act as a deterrent first of all, and Government at the time, along with the rest of the secondly to ensure that nothing is brought into the EU, to remove the borders was beneficial. I was terminal which could cause harm. All of those using that point to illustrate that if the common deployments are subject to ongoing review. Clearly travel area proposals are introduced they would be a it is up to the North Wales Police how many oYcers significant negative impact on business, particularly they deem it appropriate to deploy to Holyhead, just Y to the Welsh ports, perhaps at the expense of tra c as it is up to the Constabulary in Fishguard to going back via the Irish land boundary. determine how many are appropriate there. The Chairman: Thank you for clarifying that. scale of the port’s own security presence is discussed and agreed with the Department for Transport’s Q204 Albert Owen: Stena, in your submission you Transport Security Division, and they make talked about security and that the policing of Welsh frequent audit visits to the port to see that the port ports is already very strong. What kinds of measures is doing what it is supposed to do and that what it is are in place for the average passengers and vehicles supposed to do is adequate to the task. It has never which they have to undergo at your port? You say it been suggested that it is not. is very strong. Do you think it is adequate, do you think more can be done, or do you think it is of a higher standard than many other ports or many Q205 Albert Owen: So you think yourself, other areas of the United Kingdom? representing the port operators—and I will come to Mr Reardon: The security array that exists, for Mr Walsh as a customer of the port in a minute— example, at Holyhead is certainly extensive and that the balance between security and movement of there are several diVerent parts to it. Special Branch passengers and freight is about right? Processed: 29-10-2009 19:51:07 Page Layout: COENEW [O] PPSysB Job: 435922 Unit: PAG4

Welsh Affairs Committee: Evidence Ev 45

Mr Paddy Walsh and Mr Tim Reardon

Mr Reardon: It works at the moment. Clearly, our problems. It causes problems particularly in dream would be for the traYc to flow completely Holyhead and on the A55; they have their big site at unimpeded. That is not on the agenda at the Caergeiliog, as I am sure you know. There are moment. We recognise it is not on the agenda and we concerns, too, that the intensity of operations which work with the agencies that are there to ensure that are undertaken there is greater than is undertaken on what is there is not disruptive to the flow of traYc competitor routes, so that is a concern. and the customer experience. Q209 Albert Owen: I am fully aware of that, but I am Q206 Albert Owen: Mr Walsh, as a port user do you also aware that there are more unroadworthy think the balance is about right? vehicles coming through the port at Holyhead and a Mr Walsh: Yes, I would support what my colleague percentage of those are stopped as well, so it is a Tim Reardon has said. You have to bear in mind that diYcult one to square. the majority of people travelling through the Welsh Mr Reardon: It is. That is what VOSA say. ports to and from Ireland are holidaymakers. As I identified in my evidence, 61% of them are resident Q210 Albert Owen: Those are the oYcial statistics in the UK, so they have already been viewed going that I have got which are passed on to the port out of the country and they are coming back at the operator. end of their holidays and the CTA proposals as such Mr Reardon: Indeed. The responsibility under are quite draconian and they would propose to hold European law for ensuring the roadworthiness of up all cars on return. freight vehicles lies with the national authorities of the country that registers them and that in this case Q207 Albert Owen: Look at the freight business as is the Irish Republic. We would prefer that the issue well. There is a lot of freight going through the ports was tackled at source rather than when it lands in and this is something that you have highlighted are Wales. checked? Mr Walsh: Yes. Q211 Albert Owen: Just a final point on that. So you agree that the European level would be better, if it Q208 Albert Owen: So do you feel that that is right? was done, rather than just down to individual ports? We are coming on to the CTA shortly, but is there Mr Reardon: Yes, indeed. other legislation at a European level or at a UK level which you think is going in a direction which can perhaps impede on the free movement of freight? Q212 Mrs James: In your evidence you talked about Mr Walsh: There is a wider context of e-borders, targeting smuggling operations and periodic border which of course is currently being discussed, and controls, so obviously that would be concentrating UKBA have made no secret of the fact that if CTA on Customs arrangements, et cetera. So have you is introduced then at some stage e-Borders would experienced any notable change in the Customs roll in behind it for the Irish Sea, which would again arrangements and border control following the be a further detrimental impact on trade. Currently establishment of the UK Border Agency? the checks, as my colleague has said, seem to be Mr Reardon: I would say that changes are in the pipeline. The most obvious and easily identifiable adequate and TRANSEC on the checks they have V done on the port are satisfied that we meet all the one is that the UKBA is recruiting more sta . That requirements. We do a percentage of searches in the implies to us that that means they are going to be cars and of the cabs of lorry drivers at a level dictated doing more because they will have more resources with which to do things. Whether they will operate a by TRANSEC, a percentage level dictated by them V based on the threat level at that time. fundamentally di erent control I think depends very Mr Reardon: Chairman, if I may follow up on that, largely on whether the Common Travel Area clause there is a statute on the books, section 33 of the which is currently in the Borders Bill is enacted or Immigration, Asylum and Nationality Act 2006, not, because to do more than they do now or more which provides for ferry operators to be required to than they have historically done, changes to primary provide information about freight carryings. That, if law are required, so whether that happens is clearly it were ever exercised, would be significantly up to this building. disruptive to the flow of trucks through the port in either direction. Fortunately, it is not being exercised Q213 Mrs James: Where I was a bit confused was at the moment and the Home OYce shows no sign that you were talking about targets and relying much of resuscitating it. If it ever were to be, then there more on intelligence now than just stop and search, would be, as I say, significant disruption and a large for example? hoo-ha. Also, there are the checks which are Mr Reardon: Indeed. The Border Agency operates maintained by the Vehicle and Operator Services through both means. Ferry operators at Welsh ports, Agency on the roadworthiness and loading of freight as elsewhere in the UK, provide the UKBA with vehicles. They are particularly interested in lorries access to their manifest systems to provide them with registered in the Irish Republic—and clearly there an information base on which to target or to identify are a lot of those coming through Welsh ports— and vehicles they would wish to look at. That is the way they operate very intensive controls, at particular some of the UKBA Customs work is done. They also times, on lorries discharging from ferries, have the option, of course, to exercise professional particularly at Holyhead, and that does cause judgment and stop something on the nose, as it were. Processed: 29-10-2009 19:51:07 Page Layout: COENEW [E] PPSysB Job: 435922 Unit: PAG4

Ev 46 Welsh Affairs Committee: Evidence

Mr Paddy Walsh and Mr Tim Reardon

Mr Walsh: The UKBA have certainly increased their The impact on vessel turnaround I have already presence at the ports and they have done specific explained to the MP here and that has a significant target exercises just to get a measure of what controls eVect. If that were to continue that would have a would do to the operation and in one of the ports at serious detrimental eVect on our business. There is Pembroke it caused a significant delay and they had also a disincentive to travel. People would be less to abandon their proposed level of checks at that likely to travel if there were going to be significant time. It was purely an exercise to test the temperature delays, particularly with the day trip market, and in of the water. I understand from my colleagues in my colleague’s evidence we have mentioned the day Stena Line they did a similar exercise in Fishguard trip market on the southern corridor in particular. and this was the proposal to stop every vehicle and There is also definitely the issue of loss of traYcto check it. TraYc quickly backed up onto the ship. the Northern Ireland route, and again I have given One of the crucial things for ferry operators, and it is information on that in my evidence. Finally, there is in my evidence, is the turnaround time for the vessel. a carrier liability fine of potentially £2,000, per There are only so many hours in the day and if the person, for every person who does not have proper ship is four hours at sea and two hours in port, if identification and that could be somebody those two hours in port become three hours in port conceivably who left the UK two weeks ago on because of exercises by the authorities, then you lose holiday and has lost or mislaid their passport. So the time in your schedule which you simply cannot direct answer to your question is, I cannot specify make up. the cost at this moment in time because the picture has not been made clear. Q214 Mrs James: Just a last piece to this. How many Customs oYcers are usually on duty in your ports? Mr Walsh: It varies. As my colleague said, there is a Q217 Hywel Williams: The DfT are saying that these Y team which flows between Fishguard and Pembroke di culties will be minimised. Are you aware of Dock and there are approximately 18 people in that discussions with DfT in order to minimise the team as I understand it currently, but in Holyhead potential problems that you identify? there are significantly more because obviously the Mr Walsh: All we have been told so far is that the volume of traYc is significantly more. I think in my checks will be risk-based and intelligence led. That is colleague’s evidence it is something in the order of quite a broad phrase which does not give us any about 60, is it, in the ports of Holyhead? more information. They have also said that the Mr Reardon: That is policemen. It is about 18 for border controls will be random controls, so again, as the UKBA. I put in my evidence, it is eVectively building a house with only three walls. So if you wished to transit Q215 Mark Williams: Just one little question about from Ireland to the UK and you have got some specific checks on crew members. What illegal purpose then clearly Northern Ireland would arrangements are in place there? be the way to go. It does leave the back door open, Mr Walsh: If we go back to the Passenger that is my concern. Registration Directive which was introduced some Mr Reardon: If I may, our concern about the risk of time ago on the basis of safety so that the authorities immigration controls at Welsh ports stems from our had to know the names of all the passengers and the experience of them at English ports. If one takes, for crew members on board so that in the event of an example, the port of Portsmouth, which has a traYc incident at sea casualties could be properly reported, profile which is not dissimilar from that at at that time procedures were put in place which really Holyhead, it has not been unusual for tourist cars to just enforced the unoYcial arrangements in place for be kept waiting for up to an hour at the immigration us to share that information with the authorities and checkpoint on disembarkation from the ship and at we now provide a crew list for every sailing. We also peak times passengers have been held up for up to supply to the authorities dates of birth and other two hours simply to get to a passport checkpoint. such information as required. So there is a crew list Clearly that is a significant disruption to the journey, provided for every sailing. and if it is a day trip a significant disincentive to making that journey. There are discussions going on Y Q216 Hywel Williams: You have already referred in behind the scenes about what the Home O ce may passing to the proposals for the Common Travel or may not be wanting to do. Significant concerns Area and we were looking at the statement from DfT were expressed in relation to their earlier and they said that they were going to work to ensure consultation document issued last summer that the that the reforms are practical and eVective and that replication of the controls that currently exist at any negative impact on the public is minimal, but English ports would be thoroughly unwelcome and you raise serious concerns about the potential the Home OYce’s response document contained the impact of the proposals, so what do you think the phrase which Mr Walsh referred to, that it would be additional cost would be if they were brought in? “risk-based, intelligence-led controls”. However, it Mr Walsh: There is a number of issues really but I also said that every passenger would be required to will just summarise the key issues for ourselves. demonstrate their nationality and identity. If every Firstly, there is port infrastructure costs to change passenger is being required to do something, how the layout of the port to suit the requirements. We can it be a risk-based intelligence-led control? There cannot put a figure on that yet because to date is a contradiction there within the Home OYce UKBA have not told us exactly what is required. proposals and our concern is that what the Home Processed: 29-10-2009 19:51:07 Page Layout: COENEW [O] PPSysB Job: 435922 Unit: PAG4

Welsh Affairs Committee: Evidence Ev 47

Mr Paddy Walsh and Mr Tim Reardon

OYce is trying to do is find a form of words to Q219 Hywel Williams: I have to say I took my placate concerns without actually fundamentally constituency oYce on a works outing to Dublin last changing their plans. year. It was fantastically enjoyable, but it was the informality and speed of getting through which was one of the reasons why we went, apart from the delights of Dublin itself. Q218 Hywel Williams: That is interesting. I am a Mr Reardon: Indeed, and those excursions to Dublin regular traveller to Dublin mainly on both your will compete with trips to Liverpool, trips to services. It is an informal and very convenient way Manchester, and in order to remain competitive you of getting over, but unfortunately I could not get on, need to oVer something which people will want to I think it was the Stena boat recently when the do, and clearly nobody wants to stand in a queue for Committee went to Dublin and I had to fly from an hour. Manchester and when I flew from Manchester I had to show my passport, of course, which is what you Q220 Mrs James: You say in your paper that a were referring to. What would be the disincentive “proper assessment” of border control needs to be then to people to show their passports when they go conducted, so what type of assessment was on the boats? They do it when they go on planes, so conducted in developing the CTA proposals? What what is the big deal? were its weaknesses and how do you think it should Mr Reardon: The disincentive is twofold that we see. have been undertaken? Firstly, the logistics of checking passports for people Mr Reardon: To answer the first question, what assessment was undertaken, I have to say I do not travelling in groups in vehicles are very diVerent know. The assessment which was undertaken was from the logistics of checking a pedestrian’s passport undertaken by the Home OYce and I can only when he walks up to a desk and claims his deduce what they did from what they said in their reservation or his boarding pass. That is a one-on- consultation document. The big weakness of the one transaction and it is all about who the person is. consultation document is that it makes absolutely no Where somebody is travelling as a family in a car or reference to the existing operations run by either the as a tour party in a coach that operation logistically Police or the historical Customs function. The is about moving the vehicle, and the reservation, situation is presented as being an entirely open door again, is centred on the vehicle, not around the with no oYcial controls on it at all, and clearly that people within it. So adding a passport element for is not the case. Secondly, there is an assumption that each passenger of that vehicle to the transaction the checking of a passport is necessarily a good and would significantly extend the transaction time for useful thing. I do not think that is a case that has ever checking in the vehicle. So there is the potential to been advanced or tested or scrutinised. What we create disruption and a choke on the flow of vehicles would like to see is a clear articulation of the risks, through the terminal. The second element of security or otherwise, associated with travel across deterrent that we see is simply that some people who the Irish Sea, a clear analysis of the existing array of do not currently have a passport will have to get one. controls that are in place and the extent to which that At £72 a pop that is a significant disincentive if you existing array addresses the risks that are seen and are looking to travel. We are concerned that a then, if you like, a gap analysis to see if there is a gap, significant part of our customer base lives in a part what it is, how great it is and what would be the appropriate way to address it, rather than simply of the country where people do not readily have a start from the preconception that passport checks call for a passport. These are not people who are are necessarily a good thing and “because we do going to go regularly to Stansted Airport at the end them elsewhere around the UK let us do them in of a working week and take a low-cost flight to Welsh ports as well”. somewhere new. These are rural communities where Chairman: Thank you very much for your evidence the most frequent, sometimes the only, international today and for your earlier written evidence. As I said journey undertaken will be to the Republic and they to other witnesses, if you feel we have not covered have no need of a passport to get there now. We everything then we would be very pleased to receive would foresee that that significant cost impact could a further memorandum from you. Thank you very deter people from travelling. much. Processed: 29-10-2009 19:52:50 Page Layout: COENEW [SE] PPSysB Job: 435922 Unit: PAG5

Ev 48 Welsh Affairs Committee: Evidence

Tuesday 7 July 2009

Members present Dr Hywel Francis, in the Chair

Mrs Siaˆn C James Albert Owen Mr Martyn Jones Hywel Williams Alun Michael Mark Williams

Witnesses: Assistant Chief Constable Colette Paul, Protective Services, Detective Chief Inspector Andy Jenks- Gilbert, Strategic Ports Lead, Wales Extremism and Counter Terrorism Unit, Association of Chief Police OYcers Cymru; and Mr John Whyte, Director Central Region, UK Border Force, and Mr Bob Lyne, Assistant Director for UK Border Force Central Region, Wales, UK Border Agency, gave evidence.

Q221 Chairman: Good morning and welcome to the Q223 Chairman: Does this vary across Wales? Welsh AVairs Committee and our inquiry into ports Mr Whyte: North Wales probably sees more of it I in Wales. For the record could you please introduce think than South Wales but it can be anywhere. yourselves. Be aware that the acoustics are not very good in this room so please enjoy projecting your Q224 Mr Martyn Jones: A recent report of the voices. Defence Select Committee entitled Defence Mr Whyte: John Whyte, UK Border Agency. Contribution to UK National Security and Resilience Mr Lyne: Bob Lyne, UK Border Agency. raised concerns regarding the level of resources Assistant Chief Constable Paul: Colette Paul, devoted to identifying threats to aspects of Assistant Chief Constable from South Wales. important infrastructure, such as ports. The report Detective Chief Inspector Jenks-Gilbert: Detective also raised concerns about the lack of strategic Chief Inspector Andy Jenks-Gilbert, WECTU oversight and ministerial accountability for Strategic Ports Lead for Wales. maritime security. Do you agree with the assessment in that report? Assistant Chief Constable Paul: The ACPO lead for maritime issues is Chief Constable Hogan-Howe Q222 Chairman: Thank you very much for that. and he did give evidence to that Committee and Could I begin by asking you about the updated ACC Donellan is obviously the national co- National Security Strategy which was published ordinator. I would say that strategically and recently in which there was an increased focus on operationally it works well and has been tested in maritime security as a result of emerging threats. operations and exercises that we have carried out. Much of this was focused on shipping and trade but Obviously in terms of ministerial oversight I think could you tell us about the scale of threat facing that is for politicians to decide rather than police Welsh ports and how does this vary across Wales? oYcers. Assistant Chief Constable Paul: The National Security Strategy identifies that terrorists aspire to attack our critical national infrastructure and are Q225 Mr Martyn Jones: You could agree that we do always looking for new methods of attack, so there not have enough if you like. is a large number of facilities at ports of national Assistant Chief Constable Paul: I think that is a significance. Terrorist groups have no single chain of matter for politicians. command. It is not a single organisation but a wider network of aYliated groups, which makes it much Q226 Mr Martyn Jones: That was a very good more diYcult to combat, and they only have to get politician’s answer by the way! Has the UK Border lucky once. However, we do not know what we do Agency anything to add? not know is the truth of it as well. When you look at Mr Whyte: I think in Wales we are actually seeing a some terrorist acts that have taken place in other lot of co-operation and perhaps that report does not countries where there was no intelligence before, you reflect what we are seeing on the ground. Because of do not know what you do not know. I think that is its size we are actually able to do a lot more in terms crucial to this debate. What I do know however is of working together than perhaps we can elsewhere. that ourselves, SOCA, UKBA and other partners are working very, very closely (i) to actually identify Q227 Alun Michael: I wanted to ask a question the threats and (ii) to work together to mitigate basically about co-operation between diVerent them. In terms of threat management we are authorities and I want to ask what may be a silly identifying them and working together. question: how does TRANSEC operate? Mr Whyte: From the UKBA perspective it is a quite Assistant Chief Constable Paul: I think we have wide-ranging set of risks. We have illegal entry into already said that the co-operation is very, very good the UK, we have people traYcking, drugs in Wales. We co-ordinate our activity very smuggling, drugs going one way, cash smuggling thoroughly. TRANSEC do come to our meetings coming the other, cigarette smuggling and road fuel, and to our portal group meetings and contribute so it is a very, very wide remit. across there. Processed: 29-10-2009 19:52:50 Page Layout: COENEW [O] PPSysB Job: 435922 Unit: PAG5

Welsh Affairs Committee: Evidence Ev 49

7 July 2009 Assistant Chief Constable Colette Paul, Detective Chief Inspector Andy Jenks-Gilbert, Mr John Whyte and Mr Bob Lyne

Alun Michael: Can you define it for me; it is just a Roads Policing as well. A lot of the partners from word. across Wales come together in that. Then that links directly into the national structure. That goes to the Q228 Mr Martyn Jones: It is not even a word! Irish Sea Portal Group and the Bristol and Cardigan Assistant Chief Constable Paul: Basically they are Bay Portal Group, which links to the National the security agency for transport for the Ministry of Seaport Commanders Group and then up to ACPO Transport so they look at protecting ports and Maritime. There is a real governance structure making sure that ports and all of us work together in around multi-agency working. terms of ensuring that ports are protected. Q234 Alun Michael: Looking at it from the other end Q229 Alun Michael: What I realised as I started to of the telescope as it were, Mr Whyte, a few moments ask the question is that I am not absolutely certain ago when you were asked about whether activity and where they are located. Is this within the Department threats are the same across the whole, you suggested for Transport? Are they an agency of the that there is more activity in North Wales, so how do Department for Transport? Are they separately you within this integrated approach make sure that managed? for instance you are dealing with the diVerentials of Assistant Chief Constable Paul: My understanding is threat and experience? that they are within. Assistant Chief Constable Paul: Can I stress that I Mr Whyte: That is my understanding as well. would not say it is just North Wales. It is actually all of the Welsh ports. By the fact that we co-ordinate Q230 Alun Michael: So they are an internal part of and task throughout Wales we can help support the Department? each other. Mr Whyte: The security arm of the Department of Transport for aviation security to start with, with Q235 Alun Michael: To be fair, I picked up merely MATRA agreements and maritime agreements. that there was perhaps a proportionate risk. Mr Whyte: There is risk everywhere. Q231 Alun Michael: But they are not a separate Assistant Chief Constable Paul: Absolutely. agency with separate accountability, they are Mr Lyne: The volume of traYc in Holyhead is the internal to the Department? greatest. Assistant Chief Constable Paul: Yes. Mr Whyte: From a UKBA perspective we took the deliberate decision to make Wales one command. Q232 Alun Michael: Thank you very much indeed We had had criticism in the past because part of for that clarification. Coming to the actual co- South Wales used to link in with part of England and operation what is the nature of the co-operation and there was no identity or definition and no way to what extent are there cross-Wales aspects of co- actually for us to look at Wales as an entity or to operation and to what extent is it just local? assess the risks, so it was a very, very upfront Assistant Chief Constable Paul: I think we have a decision that we took from the opportunity that unique situation in Wales. We have what we call the UKBA’s starting gave us. We believe that has Welsh Counter Terrorism Unit where all our Special worked well because we attend all of the bodies that Branch ports oYcers and our Special Branch oYcers Colette has mentioned but we attend with one V across Wales are ringed-fenced and work together command, if you like. It may be di erent people but very, very closely with our Welsh Counter Terrorism it all comes together under one person. Intelligence Unit. Q236 Alun Michael: So Collete’s description of the Q233 Alun Michael: So these would be oYcers who way you link into the wider UK approach would are part of each of the four forces but then brigaded apply to the Border Agency as well, the link in North together as a team? Wales to Merseyside and South Wales to Bristol for Assistant Chief Constable Paul: Absolutely, they instance? certainly are. You almost get the central tasking and Mr Whyte: That is correct. control but local delivery out to each of the forces, which I think is essential. Then because we have that Q237 Alun Michael: That is helpful. Going back to sort of arrangement it means that we work very, very your helpful clarification about what TRANSEC is, closely with our partners, including all the can I ask how they work with you at an operational authorities. We run two portal groups but in level? Is there a good understanding of the addition from the Welsh side of the business we have description that you have both given of the way a Holyhead local intelligence meeting where the you work? agencies come together, we have a Pembroke local Assistant Chief Constable Paul: ACPO actually intelligence meeting and a CardiV Airport local signed an MoU in 2008 with UKBA in terms of how intelligence meeting. Some meet weekly, some meet we operate together and then TRANSEC come in. biweekly and some will meet every three weeks. We Basically they operate at all levels with us. They have then got a regional border management group come in at our Bristol and Cardigan Bay Portal and on that it has got all the key partners, SOCA, Group, they also come to the Irish Sea Portal Group UKBA, HMRC, WECTU, the Welsh Counter and they come to the National Seaport Terrorism Unit for the ports, MCA and Strategic Commanders Group, so there is a real connectivity Processed: 29-10-2009 19:52:50 Page Layout: COENEW [E] PPSysB Job: 435922 Unit: PAG5

Ev 50 Welsh Affairs Committee: Evidence

7 July 2009 Assistant Chief Constable Colette Paul, Detective Chief Inspector Andy Jenks-Gilbert, Mr John Whyte and Mr Bob Lyne with TRANSEC and we work very, very closely tactical level, so on a regular basis all the individuals together. They also come to our port security from the diVerent agencies meet and the intelligence committees which are run by the port facility is shared and there is joint working. There are a security oYcers. They come and inspect the ports number of examples on a weekly basis where we are and inspect what we do just to make sure that the doing things together overlapping the diVerent areas security is appropriate. What they did report was a of responsibility and working together with that. good standard of compliance by Welsh facilities. The The structure that is in place is eVective at the European Commission conducted a positive security moment. It certainly can be developed and at a inspection in Wales as well at Milford Haven. strategic level the border management group TRANSEC are integral in terms of some of the meeting that we have mentioned feeds up into that activity. What I would say is obviously they have got and so there is oversight of that as well. I am sure limited resources too so they do support our Bob agrees that our view was practically to get it meetings but obviously they have got limited working together and that is how it is done. resources. Mr Lyne: Because we are looking for something out of profile. It does not matter which organisation will Q238 Alun Michael: Just to be clear, these are benefit from it. We are looking for that clue. We do security experts within the Department as distinct not want to overlap and use our resources from generic civil servants? duplicating eVort. We want to find something that Assistant Chief Constable Paul: They are absolutely we are looking at which is out of a profile and then security experts, yes. go on and see what organisation is most interested in the intelligence that we get. Q239 Alun Michael: What about the ways of assessing risk? We have four police forces, we have Q241 Alun Michael: It sounds as if you are saying to the Border Agency, we have a variety of other me that the intelligence-sharing is at the level of players. Presumably they have diVerent in-house methods of assessing risk. How do you deal with commonsense that we would expect, but do not those sorts of issues? What problems arise with that? always see, so would you regard this as a case study Assistant Chief Constable Paul: One of the things we in how to do things? It sounds to me that is how you are working very closely to do is to come up with are describing it. joint risk assessments. It is not perfect at the moment Mr Whyte: I think it is very practical. That would be but that is what we are moving towards and it the word that I would use. Let me give some certainly came out in the new strategy that ACPO examples on criminal cash. Taking criminal cash out are looking at in terms of how we all work together. of circulation has a big impact, much more than In terms of our meetings we share risk on an taking the product out, and there is lots of sharing of operational basis because obviously we are sharing intelligence and sharing of results because if intelligence and sharing risk through our intelligence comes up and we do not have people operational meetings and that is, as I say, on a around we will share it with the police and vice versa, weekly, bi-weekly and tri-weekly basis depending on to the detriment of the criminal. which local intelligence meeting that you go to. Our long-term aim is to have joint risk assessments for all of the ports. It is shared on an operational basis but Q242 Hywel Williams: You gave an account a moment ago to Alun Michael of the sharing we have still got more work to do and we are doing V that. arrangements and the links between all the di erent bodies. I am sure that is perfectly coherent and understandable to you at least, if not to me, but then Q240 Alun Michael: You referred specifically to there has been this idea of having a single national intelligence-sharing through these meetings. How policing body or a service. What is your response to eVective are the current arrangements for that sort of proposal? intelligence-sharing between the diVerent players? I Assistant Chief Constable Paul: ACPO are obviously ask this against the background that we ended up having to put a specific clause in the 1998 Act to tell doing an awful lot of work at the moment around local authorities and the police that they could share active enhancement of our border policing response. information for the purposes of preventing crime From the Welsh position I wrote a paper to ACC and that does not seem to have reached all aspects of Donellan and to ACPO Maritime about what we are all public bodies, if I can put it politely. Are your doing in Wales because we think we have got a very, intelligence-sharing arrangements sophisticated and very good process and structure and that we co- eVective? operate very eVectively in Wales. We have submitted Assistant Chief Constable Paul: I certainly think they that to that review. They are looking at nine key are. I will ask Andy to step in here because he chairs areas to enhance border control and border policing some of the local intelligence meetings. and border support to other agencies and I think Detective Chief Inspector Jenks-Gilbert: I think the Wales has got a really good product to sell actually. structure that we have outlined before in terms of Mr Whyte: I would agree there. It depends how far local intelligence meetings is a massive leap forward you go with this. Bringing the UK Border Agency in terms of the co-operation and collaboration together which has three elements—part of the between the agencies. That is right down at the Foreign OYce, part of HMRC and part of the Home Processed: 29-10-2009 19:52:50 Page Layout: COENEW [O] PPSysB Job: 435922 Unit: PAG5

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OYce—has its problems. Trying to add a police Q246 Albert Owen: Have there been any discussions element into that if we are looking at a police-led about merging them with the UK Border Agency border force would be quite diYcult. because what worries me is there is a downgrading of the coastguards at the moment and there are lots of small vessels, as you know, that they identify first. Q243 Hywel Williams: This idea was last floated last Are there any discussions? year and it is a model that operates in other Mr Whyte: Only through the Coastwatch umbrella. European countries, is it not? Perhaps I should not We recognise with the resource we have we cannot be be asking you this, you might be asking me, what do everywhere and with the coastline that Wales has we you feel is the political state of play on this as far as need help and the Coastguard would be very much Y the Home O ce is concerned? part of that picture. Assistant Chief Constable Paul: If you were starting from scratch you would probably create a very diVerent service to what we have got at the moment Q247 Albert Owen: It is just that in the Baltic potentially. I think we have got very good experience they took the lead on many of the relationships now and we have built up working presentations that we went to and they were actually relationships. I think we have a very, very good armed and they were certainly a step up. structure and I think we can improve it through Mr Whyte: We have our own cutters. We have a active enhancement. In the lead up to the Olympics cutter on the Western approaches all the time and anyway you would not want to be changing agencies there is good co-operation between the cutters and and swapping things around. We should be focusing the Royal Navy and with the Coastguard but a direct on business and focusing on delivering our conversation with HM Coastguard, no. capability for the Olympics. Q248 Albert Owen: Just moving to ACPO. You have Q244 Hywel Williams: It is very reassuring that in touched in an earlier answer to Mr Michael on the Wales it works. roles of Special Branch. How are their activities co- Mr Whyte: The region I cover is the whole of central ordinated in Wales? England and I would have to say in terms of co- Assistant Chief Constable Paul: It is co-ordinated operation the comment was made earlier about through the Welsh Counter Terrorism Unit. We have whether it was a model to follow. It is a working our ports lead here who co-ordinates the activity model and on a practical level it delivers. We do not right across Wales. This is new. It does not happen see that everywhere across the regions. anywhere else in this way. I think that is a real credit Hywel Williams: Thank you. to Wales that they have pulled everything together and a credit to the four Chief Constables that have actually worked together and said that they will co- Q245 Albert Owen: As a supplementary before I operate in that fashion. It operates through co- move on, we were in the Baltic ports looking at their ordinating tasking meetings. arrangements there and there was a lot of connection between what we call the coastguards as well. What role do you see the coastguards playing and in the Q249 Albert Owen: I am aware of it in briefings that future do you think they may need to be upgraded to I get in the port but for this Committee and for our deal with certain issues of working in close inquiry it is a coming together of the four forces and collaboration with yourselves? it is about shared intelligence and, as you have Assistant Chief Constable Paul: I think the indicated, it is cross-border as well. One of the issues coastguards are crucial and they certainly support which you raised in the written submission was our multi-agency meetings and they are very, very concerns about the fact that key performance much involved. When you reduce those resources indicators only talk about dedicated work to the obviously it does have impact. I think the terrorist agenda and there are many duties that coastguards are very important. Special Branch oYcers have in the ports that are not Mr Lyne: We have an initiative that we are hoping to given the credit that you think they deserve. Could launch some time in late autumn which is Operation you explain that a little? Coastwatch which is going to be basically gaining Assistant Chief Constable Paul: Of course I can step intelligence. We are putting it out to small marinas in and then, Andy, you can add as well. It is true that and wharfs and asking the general public and we are now starting to collect KPIs on both CT trawlermen and anybody really working at ports to matters and other matters to allow for transparency use their eyes and noting to the Agency anything just around the funding, so we will be collecting them that is suspicious. It is a completely joined-up on both. It is recognised that SB oYcers can do other approach with the Coastguard and with local work but the ability to do so is limited obviously councils in case somebody is going on to a beach and because it now comes under the ACPO (TAM) just dumping litter. It could be anything really. It is umbrella. However, what they have said they will do that total approach that we are looking to be joined- is take into account a whole range of other up on and it is jointly funded and we will launch it responsibilities. They have reassured me because I some time in late autumn. had exactly the same thoughts and worries. 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Q250 Albert Owen: If you could explain what are by the local police, and that is quite right, and that is those other responsibilities. Mr Whyte talked about the way that it is actually structured anyway, so local immigrants coming through and those types of policing would do that. The dedicated resource goes things that are not recognised. into the SB resources at ports so it does not come Assistant Chief Constable Paul: And serious away from local policing. organised crime matters that come through the ports and child abduction, Special Branch have a Q254 Albert Owen: Okay. One final point on the requirement to be involved in those. There are other security that the ports themselves provide, do you matters where Special Branch are not involved and work closely with them? there are things like general policing duties at ports Assistant Chief Constable Paul: We certainly do, and also some of the protective security is not a absolutely. Special Branch role, so there are certain roles that Special Branch do and certain ones they do not. That means that it is a requirement for the force to Q255 Albert Owen: They are the ones that people actually fulfil those other criteria around general see, the uniforms that people see. Are they a policing. When you look at the DSP funding deterrent in any way? formula, they have reassured me and they have Assistant Chief Constable Paul: We work very said— closely again through our protection groups and the portal groups and obviously we have good Q251 Albert Owen: The what, sorry? relationships with the ports in both agencies actually. Assistant Chief Constable Paul: The DSP funding formula, for dedicated security posts, which actually Q256 Mark Williams: I was going to ask this later funds port policing in terms of the Special Branch but I think it is an appropriate time to ask. We had posts. Obviously that cannot be used for other some oral evidence from Pembrokeshire County activities so there is all this funding that you have to Council expressing concern about pressures on find for those other activities. policing in that area with the development of LNG at Milford Haven. Is there anything specific you Q252 Albert Owen: Another question, and again it is would like to add to what you have just said? something that I have raised locally on behalf of the Assistant Chief Constable Paul: I cannot Chief Constable and others, which is the balance overestimate the importance of the concern about between local police and port policing. Where do capacity for Dafyd-Powys and therefore for Wales as you prioritise? Obviously there is a limited resource. far as I am concerned because, as I said, the four I know this unit has been set up centrally that liaises Welsh police forces work very closely together. DPP with the four police forces, but is there not a danger is the largest force area in the country and I know that local communities who are having this extra that members of your team have actually visited to investment could lose it, to port security for have a look at the area and look at the diVerent instance? threats and issues for Milford Haven. The force Detective Chief Inspector Jenks-Gilbert: Idonot cannot meet the target times. There are graded think so personally because the dedicated security criteria around threat and risk and you have to try funding, the CT grant, is eVectively ring-fenced and meet it within a 10-minute period. This is a force specifically on this occasion for ports and the Special that is 170 miles from the west border to the east Branch security functions. So the contribution that border and it can take up to three and a half hours the Home OYce gives to ACPO (TAM) to give to the to actually get that distance. 20 minutes is about the police forces is ring-fenced for that and therefore our average in terms of responding to incidents, so we staYng levels at ports are determined to some degree would not be able to meet those and that is a real by the funding and also by the risk obviously. It is a concern to the Chief Constable but to all of us in separate issue to the police force. What we are doing Wales in terms of the Milford Haven site. The Chief is saying this is the risk to this particular port or Constable has made it really clear that he does need Wales as a region, this is where we think our some extra support and help in terms of protective resources come from, and that is where the dedicated security for this area. He has said that he needs a funding comes in which is separate to anything to do dedicated armed response to actually assist there, with normal operation policing. and that comes to about £700,000, but he has emphasised that he needs a vessel as well in terms of that area. That is probably nearer £1.5 million in Q253 Albert Owen: I understand if from your terms of training and a vessel. It is a lot of money. perspective but again from the local police Additionally, I wanted to raise that even if you do perspective they feel they are getting dragged into that you still need all the CCTV, the ANPR, the the ports on many occasions. You mentioned the back-up support around strategic co-ordinating additional responsibilities that Special Branch have. centres, so there is a lot of back-up and support work Is there not a lot of pressure on local community to actually support incidents that take place at ports police now to be dragged into ports? and elsewhere obviously throughout Wales. Assistant Chief Constable Paul: There are some general policing requirements that do belong to the four forces and that would be done by local Q257 Mark Williams: What response is he getting to neighbourhood policing teams and it would be done date to those requests? Processed: 29-10-2009 19:52:50 Page Layout: COENEW [O] PPSysB Job: 435922 Unit: PAG5

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7 July 2009 Assistant Chief Constable Colette Paul, Detective Chief Inspector Andy Jenks-Gilbert, Mr John Whyte and Mr Bob Lyne

Assistant Chief Constable Paul: I would say very Mr Whyte: There is lots of research that has gone on limited. and we have been in consultation with both ferry operators for a number of years. Irish Ferries have Q258 Mark Williams: Predictable perhaps. Are there only just given us manifest information. That has discussions with the private sector that operate at taken a long time to achieve. It is the accuracy of it. Milford Haven as to whether they would contribute The last thing we want to do is disrupt activity at the towards the need for added police in the area? port we need accurate information and the ability to V Assistant Chief Constable Paul: Obviously there are use that to target e ectively. The majority of lots of conversations going on around that. I know travellers will go through unencumbered. We will be that the Chief Constable is very, very keen because looking at the car details, we will be identifying the he is concerned about the risk and threat to this car. We will not for CTA travellers be looking at particular area and he is looking at whatever way he every passport or document but for those we can to get the resources to meet that threat. consider are abusing the system then we will. We need anything that helps us to identify them, I do not think we would be coming looking for CTA changes Q259 Mark Williams: There are discussions going V if that information was there already and was on to that e ect? accurate enough and we could work on it. It is not at Assistant Chief Constable Paul: Yes, conversations the moment. going on, absolutely. Assistant Chief Constable Paul: From an ACPO perspective we broadly supported the enhanced Q260 Mark Williams: What time-frame are they controls. We submitted our submission to the CTA working towards, is it endless? review and we did support that. In terms of the Assistant Chief Constable Paul: I cannot give a eCrime side of it and the eBorders side, that will have timeframe, no. a knock-on impact in terms of the Police Service having to respond to the alerts that you get from Q261 Mrs James: We have already taken some eBorders. I see that as very positive because it means evidence on the Common Travel Area and the issues that we are catching the right people in terms of of risk-based intelligence-led security. The ferry and criminals coming through but obviously it is a port operators are concerned that in developing the resource for each of the forces and that is something CTA proposals, little consideration has been taken that we are looking to plan for. of the checks and security arrangements currently in place at Welsh ports which they believe are robust enough. How do you respond to this? Q264 Mrs James: Just to recap slightly then, you are Mr Whyte: I think we would say that they are helpful very keen not to stop and search every vehicle. You but they are not comprehensive enough. To target want to utilise other intelligence-led information and actually eVectively police the Common Travel and make it as easy for the traveller as possible? Area—it is not travellers from Ireland per se,itis Mr Whyte: We invited all of the Welsh port people from elsewhere coming through Ireland that operators and carriers to a meeting on 19 June. Some are abusing it—we need accurate manifest came, some did not, but we made it very clear to information. We do not always get that at the those who attended that it is not our intention to moment. Some of the checks perhaps could be look at every passport. We have looked at the stronger that they are putting in place. eBorders will logistics of the port. I have been up to Holyhead a give us this information when it comes in for number of times, as Bob has, and if we were to look maritime and there is a dialogue that has now at every passport they would not get oV the boat, we started. There has been a dialogue going on for a know that, so there has to be a diVerent way.We have couple of years with the maritime industry but had dialogue with the carriers and the port operators because E-Borders was not commencing until 2010 to try and identify that. We gave them an assurance it was not very intense, it is now winding up a bit. We on 19 June that we would not look at every passport. will look for the data as part of E-Borders so we will To enable us to do that we have to have accurate be looking to gather that data whatever happens, information about who is on board, the vehicles and CTA or not. the people. Mrs James: Thank you. Q262 Mrs James: Do you think that will help plug the gaps because it was very unclear how the Home Q265 Albert Owen: To carry on that theme, you said OYce got this information about where the gaps a little earlier that eBorders were coming in were, et cetera? regardless of the CTA and one of the concerns when Mr Whyte: I do not understand about the gaps. the Borders, Citizenship and Immigration Bill was going through that was raised in the House of Lords Q263 Mrs James: Very little has been done on the was the fact that there could be displacement. evidence that we have taken to identify the gaps in Criminals could basically be going through the existing arrangements when developing the north and across into Scotland and if you had proposals for the CTA. I was a little bit concerned eBorders, I presume you would have eBorders at about that. How can you say what the gaps are if you those locations, so the Common Travel Area could have not done the research on that? produce its own problems as well? Processed: 29-10-2009 19:52:50 Page Layout: COENEW [E] PPSysB Job: 435922 Unit: PAG5

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Mr Whyte: It may. Certainly there will not be them why they let them in and with their legislation eBorders on a land border. they just could not stop them. I think they knew that they were not coming to Ireland for two days and Q266 Albert Owen: Would you favour the whole of were then going to return to wherever they had come the isle of Ireland coming under the CTA? from. They were going to look at coming to the UK. Mr Whyte: No, I would not. I think politically it We are trying to gain that information as far as we would be enormously diYcult. can. We are trying to get information on Eurolines Coaches (which are a known method of entry) from Q267 Albert Owen: Should you not be looking at the Irish, and they are very helpful and very co- security rather than the politics? Leave the politics to operative, but their legislation does not allow them the politicians. Displacement through Belfast is a to send away people that they think may abuse the serious issue. system. They have to let them in if they have the right Mr Whyte: I appreciate that. paperwork and meet the right criteria.

Q268 Albert Owen: It is not just about losing trade Q271 Albert Owen: Should not the high politics be because it could be slower; it is about criminals using to resolve that business so the Irish authorities deal adiVerent avenue to get into the United Kingdom. with that problem? Mr Whyte: We recognise the land boundary. Do I Mr Whyte: That is a diVerent country. think it should be? I do not know whether it should be or not. I think we have to deal with the situation Q272 Albert Owen: I realise that but it is a common that we have. The police in Northern Ireland would problem and terrorism is international. be set up to carry out various checks. Other parts of Mr Whyte: We are working with them and we are the UK Border Agency, the immigration trying to do something on common visas so that if enforcement side, would also be carrying out checks have individuals are coming either to Ireland or the legitimately for people who are in the country for the UK it is the same visa and they meet the same criteria wrong reason, so if they are entering the UK by a so, yes, there are things we can do, but our view is to diVerent route because it is open we would look to actually strengthen the border and stop this abuse of police that and we would strengthen our controls on the CTA we need to be certain that the legislation is that side as we go through. The Irish do immigration there, hence the BCI. checks on their side of the border at the moment and have done for some time, so I do not see any problem Q273 Albert Owen: I put it to you again that if this is with us doing it in Northern Ireland for the traYc organised and there are people coming in via major going between the two but not at the border. airports, if they know it is going to be tough at the Welsh ports they are going to drift up to the north Q269 Albert Owen: I just need to push you, in your and across into the UK in that way. written evidence you suggested an increase in the Mr Whyte: So we approach it in a diVerent way. number of people attempting to use Ireland as a backdoor to the United Kingdom. What Q274 Albert Owen: But in a diVerent way. Would it methodology do you have to produce that not be best to have a uniform way? information? Mr Whyte: If it could be done, yes, but I have not Mr Whyte: We do not attend every sailing. At the seen anything that leads me to believe that it can moment those sailings that we do attend we are be done. finding attempts to enter the UK illegally on virtually every crossing that we go to. Our Q275 Mrs James: Just on that point, we have had the impression—and it is an impression—is that this has announcement yesterday that there is extra money grown over the last few years. We believe with going to come into the French routes where there are eBorders it will grow even more because of the going to be much more stringent checks at play. Do controls that will place on other means of coming you think that it might spread out because we have into the UK. I say “impression” because we do not that displacement that my colleague from Anglesey keep the stats and we have not done because it was has just talked about and they will try other areas? a Common Travel Area in the past, but we have seen, Mr Whyte: Certainly our fear is that as eBorders we believe, increased abuse over the last few years. grows then it will become a much more attractive route to the UK if you are determined to get here Q270 Albert Owen: But your co-operation with the without following the normal procedure. Irish authorities, you will have some data from them; Chairman: Thank you very much for your evidence are they coming through small ports in Ireland are this morning. I think that we have covered most they coming through major airports? points. If you feel that we have not covered Mr Whyte: I think they are coming through major everything then we would be very pleased to receive airports. At the last meeting we had with the Irish we a further memorandum. We are now going into spoke to them about a certain case and we asked private session and we will break for two minutes. Processed: 29-10-2009 19:57:40 Page Layout: COENEW [SO] PPSysB Job: 435922 Unit: PAG6

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Tuesday 14 July 2009

Members present Dr Hywel Francis, in the Chair

Nia GriYth Albert Owen Alun Michael Hywel Williams

Witnesses: Paul Clark MP, Parliamentary Under Secretary of State for Transport, and Mr Robert Davies, Policy Adviser, Ports Division, Department for Transport, gave evidence.

Q276 Chairman: Good morning and welcome today Paul Clark: With the Ports Strategy that is there to our inquiry on ports in Wales. For the record, currently on the stocks, let me say that my could you introduce yourselves, please. understanding is that the Welsh Assembly Paul Clark: Good morning, Chairman. My name is Government has broadly agreed with the principles Paul Clark and I am the Parliamentary Under of that, and indeed there has been no active Secretary of State at the Department for Transport. campaigning to change in fact the goals of the Mr Davies: Robert Davies from the Department for settlement and so on, the settlement arrangements Transport, Ports Division. for devolution, on that issue. Having said that, we have always had clear consultations at diVerent levels in terms of the development of indeed that Q277 Chairman: We would like to begin by strategy and of course you will be well aware that we exploring the relationships between the Department are developing clearly the National Ports Policy for Transport and the Welsh Assembly Government, Statement for ports and again there have been and this may sound rather a negative question, but regular meetings and so on to discuss that with our would it be the case that there is no strategy for the Welsh counterparts. Having said that, I think what development of ports in England and Wales, as such? we do agree in Westminster and in Wales is that what Paul Clark: Perhaps, in answering that, let me say of course is one of the fundamentally important that there is a strategy for ports development, but it parts of developing and allowing ports to develop is is one where we believe that the development of of course what is in the hinterland in terms of those ports very much should be a free market-led links inland, whether that be on road or whether that development, so that is the principal underlying be on rail, and indeed that is where of course a great concern. However, having said that, we want to deal of work and consideration does go on in making make sure that ports operate in a safe manner, safe sure that we have those good links to make sure that clearly to users of the port, whether they be ports thrive and develop. employees, passengers or operators in terms of cargo and so on and so forth, so that is underlying there, and then, in terms of the environmental delivery of Q279 Hywel Williams: Some of those are developed the agenda which of course is critically important, and some, I suppose, are not, so, when you think Chairman, for all ports within the United Kingdom, about economic development, planning, transport to operate on the environmental agenda. Then, in and those sorts of fundamental influences on the terms of, I think, the outset of your question which development of Welsh ports, how do you and your was very much about the relationship between oYcials ensure that the Welsh context is taken into Westminster and the Welsh Assembly Government, consideration and how do you do your necessary I believe that there are good relationships there, and consultations in Wales with the Assembly indeed an example of that of course is that the Government, but also perhaps otherwise as well? current Secretary of State, as Minister of State, on 13 Paul Clark: Well, I think through the mechanisms May had one of the regular meetings with the that do exist in terms of, for example, as I say, at the Deputy First Minister to discuss issues cross-border highest level, ministerial level, Secretaries of States in terms of road and rail, and there has been a meeting to have those cross-border discussions and healthy dialogue, I believe, at ministerial level, as recognising very clearly where there are devolved indeed there is at oYcial level. issues, rightly so, as part of those arrangements with the Welsh Assembly,and equally there are then those issues which are clearly reserved and need to be Q278 Hywel Williams: Good morning, Minister. It is discussed, though still jointly, with ourselves and very reassuring to hear that there are good relations representatives at the Welsh level. At oYcial level, as with Wales. However, to get to the fundamental I say, there are routine meetings that happen to point, the Wales Freight Strategy which the Welsh identify the work that needs to be done and that is Assembly Government has drawn up and says it done routinely. Even so, I think the relationship at wants to develop, and an active ports policy, have oYcial level is indeed such that, even if an issue you squared that with your objectives? You arises, it is easy for people to identify their mentioned safety and environmental concerns, but counterpart and actually be able to have that essentially a free market-led policy was what you dialogue because of the general closeness that goes referred to earlier on. Is there any problem there? on, so I think in that way,but equally there have been Processed: 29-10-2009 19:57:40 Page Layout: COENEW [E] PPSysB Job: 435922 Unit: PAG6

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14 July 2009 Paul Clark MP and Mr Robert Davies a number of bodies set up to actually try and draw Q281 Nia GriYth: Obviously, you have hinted, together the cross-border working. We have Minister, at the fact that it is really the private sector changed, for example, discussion in terms of rail that needs to be developing the links to the franchising and so on and there is now a requirement infrastructure from the ports. We have been told that with any rail franchise involving obviously services in some other countries that does not necessarily that will go cross-border with Wales to make sure have to be the case and, therefore, that could be that there is full discussion involved at that level, so putting the UK at a disadvantage. Do you really feel that is a change. In fact, there is a forum which has that the current guidelines are enough of an been set up on cross-border issues with local incentive? Also, could you address the issue of both authorities, which again is another forum to make road and rail because we in South Wales have sure that the views and involvement of Wales and certainly got a long industrial history where we have English regions on the border side actually do come had very good rail link supports, but some of those together to try and get a joined-up and constructive have fallen into disuse or disrepair, and again is there dialogue going on common issues. really enough incentive for these developers to develop the necessary links for the ports to develop both through road and rail links? Q280 Hywel Williams: It is a slightly speculative Paul Clark: What I said earlier on which, as a question, but, given the diVerence possibly, as I Government, we believe is right is that we look at investment in the hinterland support in terms of identified earlier on, between your approach and good links, whether that is road or rail and indeed that of the Welsh Assembly Government, have there through various facility grants of waterborne and so been any instances, to your knowledge, of the Welsh on, more coast-to-coast movement and inland- Assembly Government wanting to intervene before waterway movement wherever possible; this is also breakfast, lunch and dinner, as it were, and putting about modal shift as well. I think that is where it is that to yourselves, and what was the outcome? Have important that the Government looks to see where there been any such instances? obviously those critical points are in terms of Paul Clark: I have not had any experience of that bottlenecks because it is no good having a very happening. I would expect, hope and intend to successful port with the best facilities in terms of continue, as you will appreciate, I am four weeks deep water or whatever it be for a given mode and into the post, a constructive dialogue and a robust for given cargoes and so on if the customer then dialogue with clearly colleagues in Wales. That is cannot get it out from there because of bottlenecks obviously clearly at Member level, but equally with on the road or in the rail system or whatever. my ministerial colleagues across the border. I am not Therefore, very much the work that we have done, aware, but there will obviously be challenges ahead again jointly with the Welsh Assembly and so on in and we will all want to deliver undoubtedly the best terms of developing obviously the Utilisation for England, Wales, the United Kingdom plc and, in Strategy and the Welsh Utilisation Strategy, is my view, the issue about ports being viable and absolutely critical in identifying those hotspots and thriving is important not only for local economies, those pinch points in terms of the major critical but certainly for regional economies as well and routes to and from a given port. Now, we have, indeed with national input as well. Again though, through resources, and that may be through regional Chair, thinking about at oYcial level whether there funding allocations where it is cross-border and have been those discussions, Robert might want to equally obviously through Welsh resources, been add in terms of that question. able to invest in some of that strategic network as Mr Davies: If I may, Chairman. In terms of ports in well. I do think obviously there is a role for, for Wales having their say in the national policy,they are example, development contributions under section of course very much part of the ports of the United 106 of the 1980 Town and Country Planning Act to Kingdom and come under the UK-level ports policy. be brought in to develop some of the infrastructure You have heard from the British Ports Association, and so on immediately around a given port or a who are one of two associations representing the given facility, but I do think it is a role which, clearly ports industry, the other being the UK Major Ports government-wise, then looks at those wider Group of which ABP is a member, and ABP owns requirements and that, I think, we have been doing. several of the important industrial ports on the south One of the reasons I was indicating earlier the setting up of the forum where the English local authorities coast of Wales, so they have significant input with cross-border issues actually have a dialogue is through those groups and we meet them very because some of this may well fall on their RFA regularly, the industry associations, and it is good to funds that they have to decide as a priority at a know that the Welsh ports have now formed their regional level, and it is about making sure that some own forum which will make an input through that of that cross-work can actually happen and deliver route as well. I think, as the Minister says, from the exactly what, I have no doubt you and I want to see, UK point of view, the emphasis of the Government is a robust structure that is there to support the is on letting the industry and the market lead on the movement of goods and people to and from a development of ports. The shipping companies will successful port. go where they want to and we cannot direct ships into ports, but we recognise all the same that there Q282 Alun Michael: I want to unpick this a little bit are local interests and regional interests in ports and, because I am a bit puzzled now. Mr Davies told us therefore, a need to provide for their prosperity. that the Welsh ports come under the UK ports Processed: 29-10-2009 19:57:40 Page Layout: COENEW [O] PPSysB Job: 435922 Unit: PAG6

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14 July 2009 Paul Clark MP and Mr Robert Davies policy, but in your first answer, Minister, you LNG and the support there in terms of energy and eVectively agreed with the Chairman that there is not there are other ports that have played to particularly an England and Wales ports policy and you said that their strengths and that development— it is very much led by a free-market approach. Now, if we set aside the issues of the environment, of Q284 Alun Michael: Forgive me, I understand that, security and health and safety, which you did that ports are trying to play to their strengths and we specifically refer to, is there actually an England and have a very segmented set of ports in Wales, but the Wales ports policy and, if so, is it in a written-down question I am coming to specifically is what the form that you could make available to us? Department for Transport’s strategy is within your Paul Clark: Yes, the answer to that is I can make it planning to link better into the internal available to you most certainly. If we go back to infrastructure of England and Wales? 2000, we set out Modern Ports which set out that Paul Clark: Well, in support of those developments, regulatory framework for encouraging a continuing to make sure that we are absolutely fully aware, both market-led investment into our ports and it did set the Welsh Assembly Government where it is a out operating though in a safe and environmentally devolved matter in terms of certain transport responsible way, which was all laid out there in the provision and at the Westminster level where there 2000 Modern Ports document. As I say, broadly that are reserved areas, for example, in terms of rail, to has been accepted by the Welsh Assembly actually be able to deliver and know where those Government and there has been no pressure to pinch points are, as I was indicating earlier, to be change the Devolution Settlement on that. We able to address those issues. Now, obviously there conducted then a review of that policy over 2006/07 will be joint working, for example, between the which led to a further statement, and again let me say Highways Agency of England and the relevant that in terms of the development of that part of that authorities within England and Wales to develop review that process involved representatives from and make sure that the strategic network is actually the Welsh ports, it involved representatives of the up to scratch and meets the requirements, so clearly Welsh Assembly Government and other key there is joint working and so on going on and work stakeholders, but that led to our expectation that going on in terms of the M4 and the M48 and ports will continue to grow, albeit where we are obviously the Severn Bridge Crossings, for example. currently within the economic cycle, but they will Obviously, then there will be other roads which, like continue to grow over the next period, we will anywhere else, are matters for a local or regional commission revised forecasts every five years which level to actually be worked through as to what is will be undertaken, we suggest using masterplans on required in that way. Now, that may involve then major ports and that is where we also talked about trying to develop obviously development introducing new guidelines for trust ports, so that is contributions, or it might be that it is a matter which very clearly laid out. In fact, I have a copy here of the clearly comes from the pot of money that is within relevant document and I will make sure that that is Wales. In terms of railways, particularly on the supplied to the Committee, Chairman.1 freight side, you are well aware that there are the freight facility grants that are available and I believe that we have made some £200 million, if I recall Q283 Alun Michael: That shows good forward correctly and I will check on the figures shortly, planning. The question though which I then come actually available in terms of actually helping to back to is the fact that your evidence refers to the develop freight facilities where there is a demand importance of high-quality inland infrastructure for for them. the development of ports, and this is an issue which has come up time and time again. For instance, the Port of CardiV, which I know best, feeds into the Q285 Alun Michael: But that is at the port itself. Midlands very considerably, so it depends on the Paul Clark: Absolutely. South Wales and the Midlands road network for its continued economic success. Witnesses have told us Q286 Alun Michael: Whereas one of the issues is the that a number of Welsh ports are less competitive limitations on expanding both the transport of because of poor connectivity to provide those people and the transport of freight on the rail service transport infrastructures, as my colleague Nia generally. GriYth mentioned, both in terms of road and rail, so Paul Clark: Well, I think, Chairman, the right what are you doing to improve this situation? What honourable Member will be well aware in terms of does your plan, as originally set out for the ports and investment in passenger services that obviously any revisions that have been made to it, say to this developments that take place may be the other side question of improving the links into the inland of the border, so investment in the West Coast Main infrastructure? Line at some £8.9 billion, investments that are going Paul Clark: A number of ports, I can think of, within on in terms of Reading Station, investment leading Wales have been successful in terms of developing to an express programme of delivery and potential their strengths and so on. I could take Milford electrification clearly can have major benefits for Haven, for example, in terms of the development of many areas within the United Kingdom, none more so than within Wales where some of those 1 www.dft.gov.uk/pgr/shippingports/ports/portspolicyreview/ developments I have already mentioned that are portspolicyreviewinterimreport being developed are already actually having eVect in Processed: 29-10-2009 19:57:40 Page Layout: COENEW [E] PPSysB Job: 435922 Unit: PAG6

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14 July 2009 Paul Clark MP and Mr Robert Davies terms of additional services, more services, and Paul Clark: Sorry, I misheard what you said. Yes, I faster services to and from and so being able to link think it is right that ports should remain a reserved up to many of the places that are of concern in Wales. matter; they are part of our national infrastructure as a maritime nation and indeed some 95% of all our goods and so on come through the ports of the Q287 Alun Michael: Coming to roads for a moment, United Kingdom, so they are pretty critical to us as how do you and your Department co-operate with a nation. the Welsh Assembly Government and what is the role of English regions in this policy? As you will appreciate, Wales and the Welsh road network Q291 Alun Michael: Well, what about port borders on to three regions for whom economic development? Do you think that should remain a development obviously is a crucial issue there as reserved matter? well. How do you deal with that? Paul Clark: Well, I think in terms of port Paul Clark: Well, one of the ways of doing it, and I development and so on that these are matters which will deal with probably the more diYcult area, I obviously can be best taken on board in terms of the suppose, in terms of where you have got English local requirements and so on and the local demands regions and clearly the joint work that needs to go on of being able to achieve that in a sensible way.As you on cross-border routes and partly because this then, will appreciate, in terms of strategic developments on the English side of the border, comes into the and major areas some of those will be aVected by the regional funding allocations and, invariably, a need new planning regime that is coming in. I do not for prioritisation to happen, is bringing together the know whether there is anything else in terms of that elements in terms of housing development, which Robert will want to add from an oYcial point development in terms of business and the economy of view. with a given region and the priorities that need to be Mr Davies: I do not think so. The national planning identified, and what might necessarily be a priority framework, obviously on grounds of equal in that region may not necessarily be the same treatment of ports everywhere, will require it to be priority obviously the other side of the border. handled at the national level, and it is the same with environmental considerations, that fair treatment of ports in diVerent parts of the country requires that. Q288 Alun Michael: That is my point. Paul Clark: Well, that was exactly why there was the bringing together of the forum of English local Q292 Alun Michael: Mr Davies, perhaps it is a authorities with cross-border issues to actually be slightly mischievous question, but, in view of the fact able to try and do some of that working together. that a free market is the Department’s preference for Indeed, you can look at, I believe, if I am right in planning, why not let the Welsh ports and the terms of one of the areas I was reading about, the Assembly plan their competition in any way they A458 which is a classic example where there have like? been issues and diVerences of opinion about the Mr Davies: I am not sure I understand what you importance of it. I think we are talking about some mean by “plan their competition”. £750,000 in terms of part of the provision, but that has been agreed from the RFA, so we have found Q293 Alun Michael: Rather in the way that we plan that way through by that hard work and that joint to play our rugby matches, I would think! work that needs to go on. The business case which Paul Clark: Yes, I think you can plan, but you can needs to be built up for any road scheme or any plan the development of the ports within Wales to transport development, we have got that worked up meet growing demand, and indeed I know that one and I think actually we are waiting for the Welsh of those areas, looking at development in terms of Assembly Government to see if they now want to Cruise Wales and so on, is exactly one of those proceed and so on to actually take this forward, so it examples of playing to the market, the market that is possible to do, but it obviously takes work and is out there, whether there is a chance for Wales at that joint commitment and that is why we set up that particular areas to be able to get, if I may say, a slice forum. I have already mentioned, for example, our of the action, and certainly we would be supportive strategic road network with the Highways Authority of that anyway, but it is certainly an initiative that is working with Welsh counterparts clearly on those happening at a Welsh level. critical routes. Q294 Hywel Williams: Perhaps I could get on to the Q289 Alun Michael: Perhaps I should ask you, other cruise market. We have been very impressed, I think, than security, should ports generally remain a in our investigations so far of the developed cruise reserved matter? market in other places, particularly in the Baltic, and Paul Clark: Yes, I think that they should. Ports are the potential for developing cruise markets on the important, and you mentioned security-wise, to the western side of Britain, but tourism is a devolved whole of the United Kingdom and in terms of matter and ports are not. Is there a fundamental security issues— tension there and, if there is, how is it resolved? If there is not, how do you work together in terms specifically of tourism, and is there here a for Q290 Alun Michael: No, I said apart from the issue instance where there might be an interventionist of security. policy from the Assembly? Processed: 29-10-2009 19:57:40 Page Layout: COENEW [O] PPSysB Job: 435922 Unit: PAG6

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14 July 2009 Paul Clark MP and Mr Robert Davies

Paul Clark: Well, I am not aware of any tension at do not know what the outcome of that assessment is all. I positively think it is right to be able to capitalise going to be at this stage and what costs might be on what is an important potential market there in involved and where that goes, but that needs to be terms of coastal work, in terms of the short sea done first of all, but what is good is that actually that cruises and so on demand there, and indeed I saw work is being done to actually be able to make sure some figures to say that the average age of a person that you can get the package right to make sure in on a cruise has fallen now by some, I think, three or this case clearly that it is at the forefront in terms of four years, which actually means an even bigger the cruise market. In terms of why there are other market than potentially is out there for all these issues there, this is a matter obviously which no people that study the statistics and trends and so on. doubt is exercising, or could be an issue to exercise, I think it is absolutely critical to be able to try and the DCMS, particularly on the tourism front where develop and capitalise on that market and certainly I know they are looking at a number of issues across we are supportive of that. You are right, it is a tourism in England, and it is certainly a matter devolved issue in terms of tourism, and certainly I which I will take on board from this Committee, am well aware of the work that is going on to try and Chairman. identify through Cruise Wales the number of ships that are there, the size of those, how you actually Q296 Hywel Williams: Just to get back to the plan, how you actually put into operation the investment issue about tourism, looking at your support mechanisms that are required for people if submission to us, and I have used the term that is they are just on call-in destinations, people staying used, would the public investment in Holyhead 12 hours, all the logistics that are involved, so we are result in “competitive distortion” and, if so, who very supportive in that way. Obviously, what will be would be aVected by that distortion? Would it be significant is the balance, that we get it right in how other ports in Wales or other ports in the UK? can we help, I suppose, in terms of the security and Paul Clark: As we have indicated earlier, we cannot the issues there, that we get the balance right for direct where ships will call and at which ports they people coming to those ports and get the balance will call because they will go where clearly the right in terms of proportionality and practicality provision is there. along with risk assessment of the requirements in terms of security issues around the operation of our Q297 Hywel Williams: So, if the provision is there, ports, whether it be in Wales, Dover or in Scotland. they will go there and, if it is not, they will not. Paul Clark: But, equally, let us be honest, geography Q295 Hywel Williams: Can I give you another for is critically important as well and it is something that instance then. As a North West Wales MP, I am we cannot change with investment, so, if it is particularly interested in the development at geographically in the right place, and indeed Holyhead because I think there that the potential for Holyhead could well be in the right place, that will the cruise market in North West Wales and North be a factor and, therefore, there will actually be joint Wales in general is enormous, but we have been told work at public and private level and genuine repeatedly that further development is required in partnership which actually might be able to find the Holyhead and elsewhere so that cruise ships can solution to the issues which Cruise Wales, for come alongside and that tendering people in just is example, is taking forward in establishing what not on these days. Furthermore, the cruise lines are, issues are involved here to be able to deliver that I suppose, quite promiscuous in the way they good package and then looking at how we actually approach these matters, that they will go wherever might need to do that, whether it is through all the facilities are available and they are not public investment or through a combination and particularly interested in developing the landside how we do that. I think that is the genuine way facilities themselves, for obvious reasons. Our forward. witnesses have told us that they see investment on the landside facilities as coming from the public Q298 Hywel Williams: May I just press you on this sector, and that is what we have been told repeatedly, point, therefore. If we have a potential cruising so how again does that square with UK policy, and market in North Wales, which would be greatly is there any danger here that the UK in general, not developed by having cruise ships calling, and, if the just Wales and North West Wales, but that the UK cruise ships are interested, but will not call because in general is missing out on the cruise market and the alongside facilities are not there, if that vital piece missing out on potential economic good, for those of the jigsaw is missing and can only be provided by reasons? I am sorry to be so long-winded. public investment, then tell us what you think Paul Clark: Let me say, I understand your particular about that. interest in Holyhead and I now know that Holyhead Paul Clark: Tourism of course, as you rightly said at is one of those ports that particularly could stand to the beginning, is a devolved matter, a matter for the actually capitalise here because of the facilities that Welsh Assembly Government. If there are matters it has already got, the deep water and so on and 24/ that are about access to and from which cover clearly 7 operation, yet there are the issues about boats strategic routes and so on, then that could well be an coming in, alongside berthing and so on. Now, I issue that is not a devolved issue and becomes an understand that one of those things that is being issue for Westminster, but I do say to you that investigated at this very moment is the possibility tourism per se is actually a devolved matter for the and the feasibility of creating alongside berthing. I Welsh Assembly Government and will be a matter Processed: 29-10-2009 19:57:40 Page Layout: COENEW [E] PPSysB Job: 435922 Unit: PAG6

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14 July 2009 Paul Clark MP and Mr Robert Davies that they will take on board, but it partly depends on in each and every port in terms of security issues. what is the small bit that is missing in terms of where Indeed, if I am right, I do not think that there is even it falls and what dialogue can be had with both the within individual police forces. Is that an issue? I Welsh Assembly Government and the Westminster think if we have a system that is actually delivering Government and the private sector as well. the security and the measures in a proportionate balance then there may not necessarily be anything Q299 Hywel Williams: Can I ask you, Mr Davies, to be achieved through harmonisation. However, it therefore, have there been discussions with the Welsh will not surprise the Members, Chairman, that Assembly Government on this particular issue? obviously these matters are always kept under Mr Davies: Yes. In fact, we visited Holyhead a few review and in discussions with those practically weeks ago and met the port and Members of the delivering in our ports or wherever it may be. I do Welsh Assembly and we were looking at the believe that a number of the ports do operate a potential and the facilities and we have a discussion system which is called Multi Agency Threat and going on at the moment about the appropriate ways Risk Assessment, but you are absolutely correct that forward. We understand that they are planning to it is not uniform. I think at this stage keeping it under put together a business proposal which is something review through the relevant agencies is probably the we shall have to discuss. Clearly, the cruise market is right way forward. As I say, I am not certain that an extremely interesting one and there are complex harmonisation will bring in a greater resource than issues of competition because in some cases, if you we actually have currently under the system. do something at one port, it actually helps another, but in other cases, if you do something at one port, it can divert the traYc from another, so it is quite complex, but we will be looking with the Welsh Assembly at the proposals they come up with for Q301 Nia GriYth: Can I move to explore the issue of Holyhead. if what we are doing is appropriate with the rationale Chairman: Perhaps we can now turn finally to port that obviously the Government wishes to try to have security. tighter border controls, particularly within the Common Travel Area, how do you see the real Q300 Nia GriYth: When we heard from the problem issues there; what are the problem issues; Association of Chief Police OYcers in Wales, they what needs to be done and do we have the resources then talked about a very good level of co-operation to do it? on an operational basis, but they did highlight the Paul Clark: In terms of the Common Travel Area I fact that the diVerent authorities involved in port think the provisions that we can see are about again security use diVerent ways for assessing risk. I judging what are the issues that we have to deal with wondered whether you have looked in any way at and how do we deal with those in a proportionate this, and would you agree with their view that they manner? We are concerned about making sure that need to take a more joined-up approach and, if so, any provisions that do come through the Bill that is how would you see the Department perhaps currently in Parliament are actually introduced in a facilitating that? way that bring minimum disruption to all Paul Clark: Let me say at the outset, and I have concerned, all users, and yet making sure that the already alluded to it in terms of the security measures security and the checks are those required. I do know that we need to take, that we need to be that—and as indeed we were just talking about proportionate to the assessed risk or the security Holyhead and two of the organisations particularly threat that there is and we need to get that right for involved, Stena and Irish Ferries, have some the travelling public so that they are protected and concerns about resources that may well need to be yet not inconvenienced unnecessarily, and also involved and whether there are going to be the whether you do it through protection or through provisions there to be able to deliver on these deterrence or it is about detection against requirements. That is why, in a sense, anything that prevention, so it is getting those balances right. You comes through in terms of the Common Travel Area are absolutely right in terms of the policing of the is work in progress and will be work that we will do ports in Wales, that it is undertaken by local police in conjunction with the critical players. I know that forces and there is not a dedicated service to the the Welsh Assembly Government, for example, ports, it is as and when required, though of course Chairman, have a concern about facilities that there would be support required through various would physically need to be required for holding other agencies and indeed through, for example, repatriation and so on, and those are currently being Special Branch as and when required in those needs, discussed with the UK Border Agency as we meet but we are talking about the general day-to-day. here today about how would you be able to deliver Obviously transport security inspectors run a in those ways. My best answer to you is that there are routine of regular inspections of all ports, including a number of issues to which we are sensitive; that we ports in Wales to make sure that there are measures recognise are practical day-to-day issues that have to in place; that there are procedures that are there to be worked through, and yet the security issue we deal with incidents when required and that the have to deal with is constituents and businesses resources are there equally as well to deliver the within these areas, constituents using these ports and security issues. It is absolutely true that there is not so on want to feel safe and secure in a proportionate a uniformity of a risk assessment system that is used way. But there are diYculties to be overcome and Processed: 29-10-2009 19:57:40 Page Layout: COENEW [O] PPSysB Job: 435922 Unit: PAG6

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14 July 2009 Paul Clark MP and Mr Robert Davies there is no dispute about that, but that is about required and so that planning is absolutely critical having the dialogue to make sure that we minimise that you get it right; so I am sure it would have been that disruption and that we minimise those taken into account but I can certainly write to clarify. problems. Albert Owen: I appreciate that. Chairman: One final point in relation to Mr Davies’ comment about fairness between the ports. If you look at the jetty development at Holyhead for alongside cruise ships, if that development had an Q302 Albert Owen: If I could just push you on that. V V adverse e ect on Liverpool, how would you define The Welsh ports will obviously be a ected directly fairness there—would you side with Holyhead or with the Common Travel Area and what is Liverpool? concerning the companies you spoke about and indeed in South Wales as well is the fact that some of Q303 Albert Owen: That is Holyhead every time! this traYc may be displaced through Stranraer if the Paul Clark: Chairman, I want to see a thriving ports Common Travel Area applies to the Welsh ports but operation within the United Kingdom, which is not to the Scottish ports. Would you have any input good for local, regional and national facilities. So I in that with the Border Agency or other agencies? want to make sure that whatever port it is thrives and Paul Clark: I am sure that there will have been delivers the services that are wanted by the people of discussions on that. I do not think I can respond to this country and the businesses of this country. specifics about that and I do not know whether Chairman: Thank you for your diplomatic answer Robert is aware; but I would certainly like to clarify and thank you for your evidence this morning and that. There would and have been some discussions also for your earlier memorandum which was because there will be implications then of resources extremely helpful in preparing for today’s session.

Witnesses: Mr Ieuan Wyn Jones AM, Deputy First Minister and Welsh Assembly Government Minister for the Economy and Transport, Mr James Price, Director Transport and Strategic Regeneration, Mr Keith Thomas, International Connectivity Manager, and Mr Tim James, Director Integrated Public Transport, Welsh Assembly Government, gave evidence.

Q304 Chairman: Bore da and welcome to the Welsh freight, and obviously increasing commercial traYc AVairs Committee and to our inquiry into ports in through any of our ports in Wales. So there is a lot Wales. For the record, could you please introduce of discussion going on. What we are trying to do here yourself? is that although the prime responsibility and the sole Mr Wyn Jones: Bore da. My name is Ieuan Wyn responsibility for ports is in the Department for Jones; I am the Deputy First Minister and for this Transport, where there needs to be connectivity and purpose today perhaps more importantly the improvements to the economic performance of the Minister for the Economy and Transport. To my left ports then obviously we need to liaise with them. is James Price, who is the Director of Transport and Keith, I think you have had a number of recent Regeneration. To his left is Keith Thomas who is meetings? charge of Transport Connectivity; and to my right is Mr Thomas: We have had a number of meetings Tim James, who is in charge of Integrated Transport recently and Robert previously alluded to the for the Welsh Assembly Government. meeting in Holyhead to discuss the implementation or the procedure that we can go by to recommend the Q305 Albert Owen: Ports, as you know, are a use of cruise ships in Holyhead and indeed reserved matter and the majority of policies are Fishguard. On a number of levels we have worked actually devolved. For the purpose of this inquiry, very closely with DfT, because obviously they are could you tell us how do you work with the reserved matters, to ensure that we have joined-up Department for Transport on port issues and are you thinking for the development of Wales as a whole satisfied with the level of consultation between the and that we are not left behind; and that is what we Welsh Assembly Government and the Department look towards. for Transport on port issues? Mr Wyn Jones: Can I first of all say that I have not actually had any ministerial meetings with ministers from the Department for Transport on port issues. I Q306 Albert Owen: Minister, do you envisage any know that Keith has had a number of meetings with bilateral meetings in the future as policies develop his counterparts in the Department for Transport in Wales? and I will ask him in a minute to explain how they Mr Wyn Jones: Yes. Clearly if there are important work at an oYcial level. But, yes, ports are a very issues that need to be resolved at ministerial level important part of the economy. It is not a devolved then obviously I would be very happy to arrange issue but obviously there are a number of issues ministerial meetings. In fact in the recent past there which are very important to us. I just heard the tail have been a number of ministerial meetings on a end of the evidence, for example, about the cruise range of issues and obviously if there are others to be ship market; there is obviously the freight market had on this particular issue then obviously we would and therefore we need to have conversations around do that. Processed: 29-10-2009 19:57:40 Page Layout: COENEW [E] PPSysB Job: 435922 Unit: PAG6

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Q307 Hywel Williams: Bore da. The creation of the justified. We would not be putting in investment Wales Ports Group has been welcomed by many of purely in terms of speculation; we would want to do our witnesses and was referred to by the Minister that based on a business case. So what we are doing who was here before you. How will this group relate is talking to port operators—or they are talking to to the Department for Transport? us—and asking if there is a business case for putting Mr Wyn Jones: I am not sure that there would be a in investment. Obviously I just came in to the tail end direct relationship between the Welsh Ports Group of the questions which did include the potential for and the Department for Transport; what they would developing the cruise facility at Holyhead, where probably be doing is working with us in order to put that is something that we would look at in a business cases for Welsh ports in terms of their development case sense: in other words, is the case there to justify and to see how we can actually develop those ports some investment? But it is not quite as easy as that for the benefit for the economy of Wales and for the because there are other issues involved such as state logistics industry and obviously for improved use of aid, which need to be overcome before you can do it. those ports. I think there is a whole range of organisations now that are coming into the picture. Q309 Hywel Williams: The Westminster Minister There is not only obviously the Welsh Ports Group, has referred in his submission to market distortion. which I think is a sub-group of the Welsh Freight Perhaps you might not be able to answer this at Group. What I have found very useful for me as a present but are any developments that you have in Minister is to have had an engagement with the mind in danger of falling foul of those sorts of Freight Group on which some of the port operators consideration about distortion? are represented, and then for us to be formulating Mr Wyn Jones: When you are thinking about any our policy in the light of their experience because I public sector investment, whether that is on the have to say that the Welsh Freight Strategy which we transport side or indeed on the business support announced in May last year was very much worked side, a number of factors have to be borne in mind— up with the freight sector, of which the ports formed state aid has to be borne in mind—and displacement a key part. I think the discussions that we had were does need to be looked at, you cannot simply ignore then reflected in the strategy which we published. So displacement because displacement will be a factor I would imagine that the relationship would that you need to look at; as well as, of course, the fact normally be with us and then of course we would Y that if you did invest that the business you were reflect their views in discussions through o cials attracting came, or at least you had a good case for with the Department for Transport. saying that the business would come. So you would have to consider all those particular aspects. What Q308 Hywel Williams: Some of the earlier discussion we are trying to do here obviously is to look at the before you arrived was around the Department for development of the cruise market in Wales from a Transport’s own policy which the Minister said was very, very, very low base and to build that up, and free market led and I am interested in any tensions anything that we can do to assist that within the that there might be between yourselves and the constraints that we have we would obviously be keen Department for Transport, given that you have to do it. stated in the Wales Freight Strategy that you want to develop an active ports policy. Could you explain Q310 Hywel Williams: I think our concern is that what that means and is it diVerent from the policy there is potential for new business not only for Wales that the Minister outlined earlier on? but in the UK context which is under-developed Mr Wyn Jones: Obviously all I can say is what our compared to what we saw in the Baltic when we were policy is in relation to ports. Our position, as I think there. I am concerned—and I think the Committee has been made clear not just in the Wales Freight might share that concern—that a fundamental Strategy but also in other documents that we have stance against intervention might just prevent the presented, is that we want to develop the potential of last piece of the jigsaw being put in place. Welsh ports. The potential, of course, is diVerent Mr Wyn Jones: What we would do would be to ask relating to where each port is located geographically, ourselves is there a business case for doing it? And its historical patterns and how you then develop that provided you could overcome the state aid and into the future. So for example if you are talking displacement issues then we would support it on that about the development of short sea crossings to try basis. Keith, could you tell us where we are at in to bring some of the freight from mainland Europe terms of the Holyhead run? But it is on the basis that into Wales, using the ports in South Wales as feeder if we can overcome those issues then we would like ports would be one way that we would want to see to support it. those develop, and discussions are ongoing and I Mr Thomas: We have been looking at the Holyhead have had discussions with port operators myself opportunity for probably 18 months now in diVerent around that. If you are talking about the cruise guises with diVerent people coming towards us markets then it is other ports again, as I think you saying, “Could you invest?” We have done a have heard evidence being given. If we are talking significant amount of work looking at the business about, for example, just the logistics of actual freight case and whilst it is not completed yet, the view that traYc, primarily these days of course by vehicles, by we have is that largely it does stack up, and lorries, then you are talking about other ports as dependent upon the amount of money needed from well. So we actually would then look at the business the Assembly Government that it would stack up for case to see whether or not any investment could be us to invest, and provided that we can get around Processed: 29-10-2009 19:57:40 Page Layout: COENEW [O] PPSysB Job: 435922 Unit: PAG6

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14 July 2009 Mr Ieuan Wyn Jones AM, Mr James Price, Mr Keith Thomas and Mr Tim James some state aid issues—and other parts of the UK and indeed in Ireland? Is that something that will appear to have done that so we believe we can—then have to come up in a business case that you are we ought to be able to invest in that to allow that determining? Who would lead that for the individual investment to come forward. The key thing with that ports, or is there an Irish Sea package or concept? is not just having the impact in the port itself; it is Mr Wyn Jones: I would start oV by saying, as I have bringing in a large number of passengers who are said to Mr Michael, that if there is a business having an economic impact within Wales as a whole, proposition to be looked at it would primarily have which of course forms part of the business case. to come from the operators themselves, and if it came from the operators themselves on, say, a pan- Q311 Alun Michael: Can we look at another aspect Celtic approach, then it would make a lot of sense of the competitive situation of Welsh ports—and this for us to be talking to our Irish counterparts and our would apply to English ports as well. We are told Scottish counterparts and we could then discuss how that they are struggling to compete with their that should be led. I think there is a lot of merit in counterparts on the continent, which receive higher doing that because I think that the point you make levels of public funding. is well made in the sense that then the issue of Mr Wyn Jones: My discussions with port operators displacement does not become so apparent and have been on the basis of attracting new business to could actually be helpful. Obviously I heard the tail the ports, which are currently, I think we would all end again of that evidence session where it says accept, under-utilised. There is a capacity there to sometimes having a cruise ship coming in actually expand business through the ports. What I have helps other ports as well. So I think that there would been discussing, particularly in the ports in South be merit in having that sort of approach. But the Wales is apart from just trying to attract new initial approach has to come from the operators with business there and assist them to do that, is to see us then being in a supportive role and seeing what we how we could, for example, feed oV the business that could do to assist. comes in through other ports in the south of England to see whether we could actually have shorter sea crossings to come across from there to, let us say, the Q315 Hywel Williams: Minister, a very basic ports in Newport, CardiV, Swansea and so on. question. The Department for Transport has made it clear that their view is that ports should remain a reserved matter. Given the potential economic Q312 Alun Michael: Do you think that that would benefits from developing ports in Wales, do you lead to an equivalence between the high levels of think that port development might be something public funding in the Continent and what you want that might be devolved? to do? Mr Wyn Jones: It is not our policy at the moment as Mr Wyn Jones: No, I think probably the scale of that a Government to actually seek devolution of the would be diVerent; but, nevertheless, what I am powers over ports, but it may well be that other saying is that— people will be starting to make a case for this—not anticipating what the Committee might be saying. Q313 Alun Michael: Is that a problem then? There are people out there who are actually now Mr Wyn Jones: Before we decide on the level of making a case for that to happen and obviously we public investment I think we have to look at the would need to respond to that. It is not part of our business opportunities. So if you actually look at the policy as a coalition government to seek it but if business opportunities that are there, then you have there are discussions around it then obviously it is to determine whether the size of the public subsidy something we would need to consider. for that business opportunity is proportionate. So I think the concept that I have—certainly speaking to port operators—is that that is one area they would Q316 Alun Michael: Something that is already in like to see developed. So what we would say to them your portfolio, witnesses have said that they think is that if they can put a business case up for that and that more should be done to improve the road links we think that there is a good case for public subsidy to the major Welsh ports and that this is a hindrance to assist in that, then we would be prepared to look to the development of the hinterland. How do the at it. What I think it would be diYcult for us to do trunk road and rail forward programmes provide for is to look at a level of subsidy when there is not a freight transport to and from ports? business proposition being put to us. Mr Wyn Jones: If we talk about roads first, obviously the A55 is the main route into Holyhead Q314 Albert Owen: Can I follow on from what Mr and I think that there are three areas on the A55 Williams and Mr Michael were asking there. When which we will be looking at. One of course is the we went to the Baltic ports we saw the Baltic concept furthest away which is the Deeside area, which is the about diVerent countries working together. Is there A55/A494, which is a particular problem. Then of a model for the Irish Sea? When we took evidence course you have the Britannia Bridge crossing over from Cruise Wales they were excited about working to Anglesey and then you have the access to the port in Scotland, Ireland and indeed the north-west of itself in Holyhead. I am a little bit at a disadvantage, England. Do you see that sort of concept and would Chairman, because I will actually be making an that get around some of these issues that we are announcement on a National Transport Plan talking about with state aid rules or displacement tomorrow, so I cannot actually give details of between diVerent ports on the west coast seaboard individual road schemes. Processed: 29-10-2009 19:57:40 Page Layout: COENEW [E] PPSysB Job: 435922 Unit: PAG6

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Q317 Alun Michael: Even if we promise not to tell because the facilities are not there. I have seen the anybody! evidence that you have also received from Mr Wyn Jones: Even if you promise not to tell representatives of the freight industry saying that anybody! But let me just make it clear that those are they agree that the facilities are not there, but the the three areas at which we have been looking. In question you then have to ask is that even if they terms of the South Wales ports then obviously I have were there would the freight operators actually use seen some of the evidence around the improvements them? I have not seen any evidence currently that to the A477 to Pembroke Dock and the A40 to they would. Fishguard. In terms of the A477 we have made certain improvements to the entrance to Pembroke Q319 Alun Michael: The question there is there a Dock and there are others in our Trunk Road proper business case, is it, for what they are asking? Forward Programme, particularly the section Mr Wyn Jones: I suppose it is but the discussions between St Clears and Red Roses, which is also in that we have had with logistics companies is that the our programme. On the A40 also we have two two advantages that they cite for road over rail is schemes which we are currently pursuing. I know cost and convenience—those are the two issues. that there has been a case put forward by There is not much you can do around the cost Pembrokeshire County Council and no doubt the because if it is cheaper to do it then the likelihood is port authorities that would like to see the A40 that the freight operators will want to use that dualled. We have looked at the business case for that option. Where it becomes more marginal—in other and it simply currently does not stack up for words, that the cost between the two becomes more dualling. However, what we have done is to make marginal—then I think that environmental sure that the improvements that we are currently considerations would come more into play and we undertaking could accommodate a dual carriage could actually argue the case. Currently I have not way road if at some future date the case for dualling seen anything stacking up that would allow us to can be made—in other words, that there is an actually be doing more than we currently have economic case for it. So we have that in place, planned, although that very much pains me because although I am sure that it is not going to be enough I would like to see it happen. for some of the ports authorities; but that is where we are. Q320 Alun Michael: The Department for Transport has issued guidance requiring developers to make Q318 Nia GriYth: Minister, can I thank you very contributions to any surface access links that might much indeed for your recent announcement to look be necessary between a port and the main transport at safety on the A48 in the Cross Hands area, and infrastructure. How eVective is that guidance in indeed not so very long ago another announcement your view? about investment in the rail west of Swansea. You Mr Wyn Jones: I do not think we have that guidance have referred now to some very, very diYcult areas ourselves, do we? on the A477 St Clears to Red Roses and the A40. Mr Price: We use similar guidance but it does not What are we doing about more rail investment to try just relate to ports, it relates to anything, so if you to get some of these huge lorries oV these very small had a significant development occurring beside the roads and is there a case for further rail investment motorway—and we had an example of that and more encouragement by the ports to actually use recently—we would put planning conditions on the those services? developers so they have to contribute towards the Mr Wyn Jones: I have to admit that this is a diYcult cost of improving the motorway, for example. That V V issue for us because we have made it quite clear in can be e ective. How e ective it is, is obviously very our Transport Strategy and in our Freight Strategy dependent on the amount of profit the operator can that we would like to see more freight move from make out of the improvement they are looking to road to rail. The current diYculty we have is that we put in. do not have the facilities in the ports to enable us to actually do that easily. Unless of course we can Q321 Alun Michael: And your experience? persuade the operators, the ports and Network Rail Mr Price: On the ports side, we have not had that to actually invest in those then as a government we much. cannot do it on our own. Of course, again, the Mr Thomas: We have not had that much. For ports, problem we have is that because to be perfectly blunt for instance, we have seen some looking for carrying freight by road is a lot cheaper than something like a 10 times return on their investment. carrying it by rail—particularly over short distances—then a lot of the freight operators Q322 Alun Michael: If there is an issue with links of currently do not have the appetite to actually shift that sort, is the Welsh Assembly Government able to their freight on to rail. I think it is beyond our remit provide any financial support? as the Welsh Assembly Government to create the Mr Price: Through Freight Facilities Grants, conditions by which we could do that, but it is working with DfT, yes, is the answer. But again it certainly something that we as a government would requires the company to come forward or us to be like to see developed, and it has to be done at a UK working with a company on a project which actually level. I very much agree with the sentiment behind stacks up. I guess in the current economic climate it the question but we feel that there is not much more is more diYcult than it has been before. The other that we as a government can do to pursue that thing we should say is that whilst it is very diYcult to Processed: 29-10-2009 19:57:40 Page Layout: COENEW [O] PPSysB Job: 435922 Unit: PAG6

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find operators who are willing to go forward and infrastructure which is necessary for this new take the modal shift, where we have got facilities— technology. We know, for example, some of the most Wentloog is an example—we are working to try and attractive locations for renewables are oV the Welsh make sure we do maximise the facilities we have got, coast and I would be very keen to be working with which I do not think is the case currently. my colleague, Jane Davidson, in order to facilitate, if you like, the development of the Welsh ports for renewable energy. I know, for example, that some Q323 Nia GriYth: You talk very much in your talks have already taken place and I would be very evidence about wanting to facilitate the happy to support that. infrastructure to help ports feed in and out from their local areas, but what in practice has the Assembly Government been able to do to encourage Q325 Nia GriYth: You hinted earlier at the idea of better use of the ports? getting transport round the sea instead of coming Mr Wyn Jones: I know for example that lots of across the roads, especially to South East England. discussions go on. I have had them myself, both in Is that really a realistic option in terms of trying to my current position, when I was just Assembly persuade people to do that? You have mentioned the Member for Ynys Mon and previously as a Member cost of rail as opposed to road freight and of Parliament. Port operators very often lobby very presumably the issue here is the time it takes to go hard indeed for improvements to the road round by sea. What attempts were made when infrastructure, primarily for road infrastructure Amazon sited itself right on the Swansea port to because currently that is how the vast majority of encourage it to make use of sea transport? freight is carried through Wales. What we try to do Mr Wyn Jones: Actually the Amazon development is to make sure that if there is an economic case for happened before I came into post, and I do not know actually improving road access to a port, then we will whether colleagues have any information on that. look at that. Obviously the A55 in Anglesey has been You are right, the business case would have to stack concluded but there are still two parts on Anglesey up for the port operators to actually use it, but the which need to be looked at, which is the access to the problem we have is that if you simply look at port itself and Britannia Bridge, and I have indicated investments in port infrastructure without looking the improvements to the others. The ports for the business opportunity which will arise once themselves are very active in pursuing these you have done it, then you could be accused of improvements because it will help them to develop wasting public money. So we have to see whether their throughput of freight, and what has tended to there is a proper case which can be identified. happen is that each improvement in the Certainly I think there is value in pursuing it, and so infrastructure improves the attractiveness of that do the ports, because they think of the congestion port for freight traYc. I have certainly seen that just they hit if they are bringing traYc from ports in anecdotally across the island and across North Wales. Every time there was an improvement to the certain parts of South England to our region, and it A55 more freight came through the port of could save them a lot of time by doing it via a short Holyhead. If you look at the figures, the increase in sea crossing. I have to admit that these are early freight traYc through Holyhead has been dramatic days, we have not gone very far in these proposals, in recent years. What we have seen in the two South but it is something I am very keen to explore. Wales ports—Pembroke Dock and Fishguard—is that we have not seen similar levels of growth and the Y Q326 Hywel Williams: Mr Price mentioned earlier majority of Irish freight tra c tends to come across the study in Holyhead, are you doing any other the central corridor, and therefore the case for studies or do you intend to on the potential of the dealing with the A40 does not stack up in the same cruise market in Welsh ports? way as the A55 did. Mr Wyn Jones: Yes, we are looking particularly at Milford Haven, and it was interesting that there was Q324 Nia GriYth: If we look at the UK Ports a report in the newspaper today that a cruise ship Prospectus, they talk about developing ports such as had been to Newport. I think cruise ships have also Mostyn, Milford Haven, Port Talbot and Swansea visited CardiV; I am not sure about Swansea. for the oVshore renewables industry. What is the Mr Thomas: Yes, I think so. Welsh Assembly Government doing to promote Mr Wyn Jones: Maybe Swansea. So the cruise thinking about that? It is a chicken and egg situation market is something which is under development in because until you know what is going to be out there Wales and we are very happy to be looking at it is diYcult to push the port and be up-front and opportunities wherever they may arise. If there are grab the business. opportunities for us to be using more than one port Mr Wyn Jones: I think that is a very important point in a visit, we could obviously maximise those that you make, because we have to look at the whole opportunities. range of business opportunities there are for ports. We have tended to concentrate in our evidence so far on things like the cruise market and short sea Q327 Hywel Williams: You did say earlier that it is crossings, but I think the point you make about up to the operators really to take a lead, but is there renewables is equally valid because we could actually a role for the Welsh Assembly Government to act as be using our ports as points of entry for much of the a catalyst or a co-ordinator for bringing together Processed: 29-10-2009 19:57:40 Page Layout: COENEW [E] PPSysB Job: 435922 Unit: PAG6

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14 July 2009 Mr Ieuan Wyn Jones AM, Mr James Price, Mr Keith Thomas and Mr Tim James companies which might potentially be interested in Mr Price: I think the group that is Cruise Wales is calling which on their own might not want to take doing that, trying to bring industry together, and that development forward? then we are trying to say, “How can we, from a Mr Wyn Jones: What I have found, and I am not an transport perspective and a regeneration expert on the cruise industry, is that, because there perspective, import the facilities necessary to are more and more people now looking for holidays deliver that.” by cruise, the cruise operators are looking for new destinations all the time, and they do not want to Q329 Hywel Williams: Can I ask you about a body which I was not aware of, and that is Celtic Wave, keep going to the same destinations because they which I understand is a marketing organisation. Do have people going more often now and they want you have any involvement with them and, if so, new experiences. So the port operators themselves what? recognise now there is a real opportunity for looking Mr Thomas: Personally we do not have involvement at areas such as the Celtic countries, so I think the with them, but our colleagues do within interest is there. What is important for us is that we International Business Wales, the inward investment do not miss the opportunity as a result of that arm of the Welsh Assembly Government. Interreg interest, and working with them I think is the way to involves Ireland, Wales and Scotland as part of that do it. I think the interest is there, but do we have the and that Interreg looks at developing the Celtic Sea facilities to meet the demand of the sector. I think and to cruises around the Celtic Sea. Then, as James James was absolutely right when he said that we said, we are looking to develop the facilities to ensure should be looking at this not simply in terms of the we can actually accommodate those particular immediate location where the cruise ship lands but cruises when anything comes about. also the immediate area, the region, around it as a way of capturing more tourism traYc and spend of Q330 Chairman: Thank you very much for your course, which is very important. evidence this morning. It would be remiss of me not to mention the importance of the Port Talbot deep water harbour as well. Q328 Hywel Williams: As a Caernarfon MP I am Mr Wyn Jones: It is very important to me, Chairman. particularly interested in that potential. What is the role of Cruise Wales in this? Q331 Chairman: I am very grateful to you for Mr Thomas: Cruise Wales is the facilitator and the endorsing those comments. Thank you for your co-ordinator. What we are trying to do is match the evidence today and thank you also for your written facilities with the ambitions, so they size the market, memorandum. I hope when we do produce the quantify it, and then look at how we can deliver it report in the autumn, we could have a further and, as previously stated, there are the financial dialogue about its contents. implications and also the state aid implications. Mr Wyn Jones: We look forward to that. Processed: 29-10-2009 23:00:04 Page Layout: COENEW [SO] PPSysB Job: 435922 Unit: PAG7

Welsh Affairs Committee: Evidence Ev 67 Written evidence

Written evidence from Associated British Ports (ABP) 1. Introduction 1.1 This submission is made on behalf of Associated British Ports (ABP). ABP is the UK’s leading and largest ports group with 21 port facilities and other transport related businesses around England, Wales and Scotland. ABP is a privately owned company. 1.2 ABP very much welcomes this inquiry into Ports in Wales and the interest it shows in a sector of major strategic and economic importance. 1.3 Associated British Ports operate five major ports in south Wales: Newport, CardiV, Barry,Port Talbot and Swansea. These ports are important gateways for trade and also support major manufacturing on sites contiguous to the ports, such as Corus, Dow Corning and Celsa. The five ports lie on the northern shore of the Bristol Channel and are established as major ports in South Wales but also importantly as a key hub for servicing a hinterland that extends to the Midlands, south west of England, M4 and M5 corridors and London. 1.4 Seaports are unique assets in providing multi-modal hubs to users, combining connections between road, rail and sea. The south Wales ports all have direct links to the national rail network, the UK motorway system, combined with deep-water berths able to accommodate some of the largest ocean going vessels. 1.5 In addition to being nodal points for import and export of cargo, ports provide locations for value added employment and investment from logistics providers through to manufacturers and retailers, and form part of the regional oVering for attracting both UK and foreign investment. Ports close to the origin or destination of cargo can also minimise the environmental impact by utilising shipping, widely regarded as the most environmentally benign mode of transport.

2. Policy Framework for the Development of Welsh Ports Many of the specific policy issues are dealt with under the themes highlighted by the inquiry, but there are a number of themes that ABP would like to raise.

2.1 Licensing and MMO The establishment of a new Marine Management Organisation (MMO) under the Marine and Coastal Access Bill has been supported by United Kingdom Major Ports Group (UKMPG) of which ABP is a member. The UKMPG has recognised the potential benefits in consolidating a number of licensing regimes through a single body in order to streamline the process.

2.2 Local development plans ABP believes that it is essential that the strategic importance of ports is recognised through local development plans and regional plans. This submission provides further detail of the contribution of ports to their local and regional economies, and their role in stimulating inward investment.

3. Contribution of Welsh Ports to their Local Economies 3.1 The importance of ports to the economy is identified in a recent research paper Associated British Ports and the Welsh Economy (Welsh Economic Research Unit, CardiV Business School and Welsh Enterprise Unit, University of Glamorgan, June 2004, updated 2009). The research provides some key findings that illustrate the importance of ports as economic drivers for the region. The fact that the activity of ABP and its tenants in South Wales directly and indirectly support £79.8 million per annum with a GVA of £34.2 million, and the activities of ABP’s port tenants account for an estimated 9,711 FTE jobs, with a direct and indirect output of £2.78 billion and GVA of £902.5 million (2% of the Welsh total) clearly illustrates the salience and potential of the seaport. 3.2 The south Wales ports are key assets to the region and the industries within, and have capacity for substantial growth bringing employment and inward investment to Wales.

4. The Potential to Increase the Scale and Range of Trade with Other Countries 4.1 Welsh ports have evolved in recent times, driven by the increasingly global nature of trade and the economy as well as the decline of the UK manufacturing sector and mining industry in Wales. In the last decade trade has generally grown steadily in the south Wales ports, closely reflecting prevailing economic conditions; in 2007 the Port of CardiV handled its largest annual volume since the early 1970s. There are a number of key areas in which there is potential for substantial growth in the scale and range of trade in south Wales, most notably in the energy sector and container traYc connecting Welsh ports with other European countries. Processed: 29-10-2009 23:00:04 Page Layout: COENEW [E] PPSysB Job: 435922 Unit: PAG7

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4.2 Ports are key links in the UK’s energy supply chain. The Port of Newport plays a pivotal role in the support of power generation within Wales, handling coal imports for Aberthaw and Uskmouth power stations. The Port of CardiV is a major distribution centre for transport fuels, supplying the region’s forecourts with petrol and diesel, a significant proportion of which is moved by coastal shipping helping to reduce road miles. 4.3 The geography of electricity generation in the UK has traditionally been based around coal reserves and access to North Sea gas resources. The dynamic is changing as the U.K. becomes increasingly reliant upon internationally sourced and imported fuel supplies. Generators are increasingly exploiting the connectivity of ports to meet their supply chain demands. 4.4 The brown-field development land within and directly adjacent to the port estate provides prime sites for locating energy generation plants, particularly for renewable energy schemes. A number of such developments have recently received planning approval including the world’s largest biomass power plant at Port Talbot, which will import feedstock using the tidal harbour. 4.5 There is also an opportunity to develop facilities for energy production on ports and contiguous sites, for example for biofuel production sites such as the bio-diesel production facility that recently received planning approval at the Port of CardiV. Ports will also play a crucial role in supporting the development of oVshore energy resources, providing construction sites and supply bases for exploiting wind, wave and tidal power. One of the zones identified by the Crown Estate for Round 3 of the oVshore windfarm-leasing programme lies a short distance from the south Wales coast. 4.6 Documents such as the recently published Bioenergy Action Plan for Wales fail to recognise the advantages oVered by ports in the energy supply chain. All aspects of energy policy in Wales should reflect the strategic importance of ports.

5. Potential to Increase Freight Movements through Welsh Ports 5.1 Good transport connectivity and sustainable freight networks across all modes is vital to achieving competitiveness for retailers and manufacturers in Wales. The eYcient movement of both industrial and retail freight is a necessary component for achieving the region’s full potential. As multi-modal hubs, the ports in south Wales have great potential and adequate capacity to stimulate growth in freight movements, particularly Containers and Roll On/Roll OV traYc. Ports provide access to continental and international markets for manufacturers and allow raw materials to be sourced from suppliers globally. For the retail sector in Wales, the cost of delivering goods to market directly impact the price on the shelf edge and as such, connectivity is crucial to maintaining the competitiveness of retail in Wales.

5.2 A number of very large businesses with extensive supply-chains have been encouraged to locate within Wales in recent times, for example Amazon. It is apparent that these companies are not being made aware of the oVering of the ports within the region and the advantages that they aVord. Promoting ports as part of the oVering to potential investors in the regional hinterland may make Wales more attractive and these types of investment are more sustainable.

5.3 The globalisation of the economy and decline in UK manufacturing has lead retailers and manufacturers to re-examine supply chains and distribution networks The brown-field development sites in and adjacent to port estates present an opportunity to stimulate investment and employment in South Wales through the concept of “Port-centric logistics”. Rather than transporting imported goods many miles inland to national distribution centres, distributors should be encouraged to establish regional distribution centres within and adjacent to ports. This presents significant environmental benefits in reducing road miles and the carbon footprint of supply chains and encouraging a modal shift to short-sea shipping from hub ports to regional ports. This type of development also has the benefit of value added activity for the region. 5.4 Sea transport is recognised by many as the most environmentally benign mode of transport and further reduces congestion on the busy road and rail infrastructure. Through the Wales Spatial Plan, local development plans and other policies the strategic importance of ports and their ability to facilitate inward investment and catalyse sustainable economic growth should be recognised. Applying a “presumption in favour principle” to consents for developments in and around ports that encourage this would make investing in Wales more attractive.

5.5 CardiV Container Line ABP commenced operation of CardiV Container Line, a door-to-door container service connecting the UK and Ireland, in October 2008. The service oVers up to three calls per week transporting maritime containers between CardiV and Dublin. ABP is actively pursuing opportunities to expand the range of services calling at the terminal. In particular the possibility of feeder services, linking South Wales directly with deep-sea European hub ports, where containers could be transhipped from the deep-sea liner services to/from the Far East and North America to smaller vessels calling at CardiV. Processed: 29-10-2009 23:00:04 Page Layout: COENEW [O] PPSysB Job: 435922 Unit: PAG7

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5.6 Port Talbot Tidal Harbour Port Talbot Tidal Harbour is a national strategic asset to the region as one of only three “cape-size” facilities in the UK.1 With globalisation and advances in maritime architecture, the size of vessels engaged in international trade continues to grow as shippers look increasingly to exploit economies of scale. Port Talbot has the potential for significant growth into new markets including energy, renewable and containers. As discussed further in section 5.8 the importance of maintaining rail links within the region and rail connectivity beyond the region is crucial to exploiting this asset fully at both a regional and national level.

5.7 Wales Freight Group ABP has been an active member of the Wales Freight Group that has worked in partnership with the Welsh Assembly Government to publish the Wales Freight Strategy, to deliver a “modern, eYcient freight transport system in ways that will support and balance economic, social and environmental objectives, in line with the Wales Transport Strategy”. The purpose of the strategy is to assist regional transport consortia in the development of regional transport plans and this document should form part of the policy framework for the development of Welsh ports. ABP believes the establishment of both the Wales Freight Group and the Welsh ports sub-committee has been a very positive step for developing freight strategy in Wales.

5.8 Encouraging sustainable modal shifts Grant funding is important in encouraging sustainable modal shifts in favour of short-sea shipping initiatives. The existing grant system is flawed in that it is often infrastructure based and not that easy for larger business to access. A revenue based scheme that actively encourages freight to utilise more sustainable modes of transport perhaps may be more applicable. South Wales ports are well placed for access to major population centres in both Wales and England and can play a key role in developing this type of activity.

5.9 Road links 5.9.1 Whilst recognising the need for major improvements to the M4 to ensure adequate connections to/ from South Wales are maintained, particularly the restrictions imposed by the Bryn Glas tunnels, ABP is extremely concerned that the current proposals for the new motorway to bisect Newport Docks will adversely impact upon trade through the Port of Newport. This submission has already highlighted the socio-economic contribution of ports to their local economies and any scheme proposed should not adversely aVect existing trade or future development prospects. ABP is fully engaged in the consultation process with WAG on this subject. 5.9.2 ABP would also like to highlight the strategic importance of a number of local road enhancement projects. In particular, the completion of the Port Talbot peripheral distributor road, the Fabian Way infrastructure enhancement works at Swansea and the Eastern Bay Link Road in CardiV all of which help to improve transport infrastructure to the immediate hinterland.

5.10 Rail links 5.10.1 It is essential for the continued development of ports and sustainable freight networks that rail freight paths are retained and protected. It is also vital that work involving Network Rail, freight operating companies, Government and other key stakeholders continues to remove capacity and capability constraints for freight on the rail network. These include removing freight network pinch points (in particular the Severn Tunnel) and addressing gauge issues in Wales. 5.11 The EU Trans-European Networks (TENs) system should be considered to support the connectivity between ports and the hinterlands, particularly links extending beyond Wales.

6. The Development of Tourism and the Potential for Attracting Cruise Ships to Wales 6.1 ABP is an active member of Cruise Wales, a public-private sector partnership, which has been established to promote and market Wales as a cruise destination to international passengers. The partnership is made up of representatives from government, tourism and port organisations from all of the major ports in Wales. Cruise ships have potential to bring economic benefits to the region and its tourist based economy. 6.2 In addition to “transit” day call visits of cruise ships, ABP believe the south Wales ports oVer significant potential as regional departure ports for cruise lines. The proximity of the region to major population centres makes this a viable prospect in the future as cruise operators develop more regional departure points.

1 A cape-size vessel is a bulk carrier that is too large to navigate the Panama or Suez Canal and is in excess of 150,000 deadweight tonnes. Processed: 29-10-2009 23:00:04 Page Layout: COENEW [E] PPSysB Job: 435922 Unit: PAG7

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7. The Adequacy of Security and Policing Provisions at Welsh Ports 7.1 The ABP South Wales ports comply with the International Ship and Port Facility Security Code (ISPS), a comprehensive security code that has introduced a range of measures to protect the ship/shore interface. These measures include fencing, restricted access (to ports/vessels), guarding and notification procedures. The ports will shortly have to comply with the EU Security Directive, which will be implemented through new regulations later this year. Security at Welsh ports is generally adequate, but we recommend that more support and improved relationships with police forces at a local level would be of benefit in dealing with specific issues as they arise.

8. Severn Tidal Power 8.1 ABP is currently engaged in a consultation process looking at the potential impact of various proposals for the construction of tidal power schemes in the estuary. Some of these proposals could greatly aVect ports in Newport, CardiV and Barry, and their future as strategic gateways capable of supporting economic growth and sustainable distribution. In the event that any scheme is progressed that leads to trade being displaced from ports, best endeavours should be used to ensure this trade remains within the region. May 2009

Written evidence from Dr A K C Beresford Historic Influences on the UK Port System The ports of the UK have served the country’s needs extremely well for centuries. This is evident not only in terms of the ports providing safe havens for vessels, cargo handling capability and managerial expertise, but also by the ports’ ability to change and adapt to best fit the conditions and requirements of the time. Historically,this was seen at, for example, CardiV when, in the early 20th century,some of the world’s largest sea locks were built to accommodate the new generation of steam-driven ships. In parallel, one of the world’s densest freight rail networks was developed in South Wales to cater mainly for the huge volumes of export coal—peaking at around 20 million tonnes in 1913—passing through the South Wales ports (Beresford, 1995). The scale of this eVort should be judged against the relatively modest size of the towns of, for example, CardiV, Newport and Swansea at the time. Interestingly, the Port of Rotterdam handled exactly the same volume of cargo in 1913 as CardiV: around 12 million tonnes. More recently, following the well-documented steep decline in bulk exports in the mid-20th century, a number of west-facing ports demonstrated a strong will to survive, and a commendable ability to innovate, with parallel strategies of concentration, diversification and integration according to circumstances. The decline of traditional industries, reduction in trade with the colonies, and the emergence and enlargement of the European Union, led to a pronounced east-west split with most ports in the east of Britain, especially the south east, seeing growth in their traYc and those in the north and west generally experiencing shrinkage. This pattern was most pronounced from the mid-1960s to the mid-1980s. The technological shift towards unitisation and containerisation during that time further encouraged concentration of the higher-value trades, both near sea and deep sea, into the container terminals of Felixstowe, Tilbury, Thamesport (open late 1980s) and Southampton. Liverpool consolidated its position as a North America “specialist”. RO-RO terminals at ports such as Immingham, Hull, Harwich, Dover and Portsmouth also saw trade grow rapidly mainly based on a healthy mix of passengers and freight flows. Several of these ports also developed “feeder” links with the big continental ports, enabling them to “lock into” the maturing logistics systems which were increasingly linking the Far East manufacturing countries with the huge European market. “Facing Rotterdam” had become a key aspect of UK port logistics.

Patterns of Port Development:The Core-Periphery Model Probably the most enduring model of economic development which can be readily applied to ports, is the “core-periphery” model first applied in the context of European urbanisation and agglomeration in the early 20th century (Clout 1981). The model essentially links economic opportunity to development so that in Europe, for example, GNP per capita, employment, regional development and other socio-economic variables resolve into a broad pattern of “favoured” and “less favoured” regions. Although this has long been recognised as a gross simplification, nonetheless the pattern has endured, with some variation, over several decades and has formed the basis of long-term regional policy at national and supra-national levels. With specific reference to ports, the core-periphery model manifests itself in Europe and elsewhere in the following ways: — Where population density, market size, regional output or natural resources are at a maximum, opportunities for port development are also at a maximum. Thus, in “core” areas, there tend to be more ports, bigger ports, and ports with a wider range of cargoes and handling facilities. — In “peripheral” areas, where markets are smaller, or more widely dispersed, where natural resources are not available and where output is less, ports tend to be fewer, smaller, more widely separated and more specialist. Processed: 29-10-2009 23:00:04 Page Layout: COENEW [O] PPSysB Job: 435922 Unit: PAG7

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The validity of this thesis, and the persistence of this pattern, can be judged by comparing the location, size and functions of ports in the 1980s, with the blueprint around twenty years later (Beresford and Dobson, 1989; Aldworth, 2007). The relevance of the core-periphery model, as applied to ports, extends well beyond Europe and it can be seen in virtually any region of the world. This is not to say that ports in peripheral areas cannot be large or that they cannot be successful, but they do tend to be, on average, smaller and/or more specialist (Eddington, 2006; Pettit and Beresford, 2008).

Port Ownership The early 1990s saw the first clear evidence of overseas interest in our major ports with Hutchison Ports Holdings acquiring Felixstowe then Thamesport. The UK model of port ownership, based largely on variants of private operations, was not only oVering new “internal” opportunities for fresh capital and entrepreneurship, but was proving to be very attractive to the UK non-port or part-port companies and to overseas terminal operators. Internal examples in the 1990s were: TBI (airports) showing interest in Shoreham, Langham Industries (construction) particularly in Portland Port, Govan Davies (property) in Pembroke Dock, and more recently, Peel Holdings’ purchase of Mersey Docks and Harbour Company in 2005. Peel Holdings have a diverse property portfolio including the TraVord Centre in Manchester; Liverpool—John Lennon Airport; Clydeport; and the Manchester Ship Canal. Examples of buying into UK ports from overseas were: Hutchison Port Holdings’ (Hong Kong) purchase of Felixstowe then Thamesport in the 1990s, Dubai Ports World’s acquisition of P&O Ports (hence acquiring major terminals at Southampton and Thames Gateway), and the recent Admiral Consortium purchase of Associated British Ports (ABP). It could be contended that no other country in the world would be so open to overseas participation in a key strategic industry such as seaports. This is a measure of the flexibility of our systems from a legislative and commercial point of view, and of the attractiveness of many of our ports as viable businesses. This is especially true in south east England where the greatest range of ownership type is to be seen (Pettit and Beresford, 2009).

Welsh Ports In South Wales, we see the newest example of overseas participation with the unique Qatar-UK LNG joint venture, linking the South Hook Terminal at Milford Haven to the National Grid via pipelines, opening up a new sea-pipe “intermodal link” between the Middle East and Wales/England.2 This link capitalises on: supply from Qatar, demand mainly in England and a port/pipe “bridge” through Wales. Wales and England are thus interlocked. Milford Haven’s main assets are: deep water, marine accessibility and a sheltered harbour. Although understandably, it has environmental sensitivities, it is remote from large population centres. Logistically, a sea-pipeline combination is right for large volume, long-term LNG import. Elsewhere, there are many examples of the interdependence of Wales and England in the context of freight/ passenger movements, and of Welsh ports acting as international gateways: — Welsh ports handling English cargo: — Holyhead—Roll on, roll oV. — Milford Haven—LNG, oil. — CardiV/Newport—Unit loads. — English ports handling Welsh cargo: — Dover/Portsmouth—Roll on/roll oV. — Southampton/Bristol—containers, cars. — Liverpool—bulks, general cargo, containers. — Welsh ports serving Europe: — Airbus wings manufactured at Broughton exported to France via Mostyn. — Welsh Ports, notably Holyhead, Fishguard, Pembroke and Swansea, historically acting as “landbridge” modes between Ireland and England/continental Europe. In all of these, road links and/or rail/pipeline to/from the ports are also vital components of the transport chain, particularly where cargo value or freight volumes are high, or where passenger movements are large. Thus much of Wales’ port capacity and capability is actually serving England, Ireland and continental Europe. Likewise, several English ports are vital to the well-being of the Welsh Economy, especially when an appropriate multiplier is applied (Bryan et al, 2006). It is suggested that ABP ports alone generate nearly £1.7 billion of activity in South Wales and the indirect impact of this extends well beyond Wales alone.

2 The Admiral Consortium consists of: — Goldman Sachs, Wall Street Investment Bank, USA; — GIC, Singapore Government Investment Company; — Borealis, Canadian Pension Fund; and — Prudential, Infrastructure Division, UK. Processed: 29-10-2009 23:00:04 Page Layout: COENEW [E] PPSysB Job: 435922 Unit: PAG7

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The overall British port system, therefore, is interlocked, especially for mobile or footloose cargo such as unit loads. We are not in a situation where Welsh ports simply serve Wales and English ports simply serve the needs of England.

Port Value Added Services: ABP Connect How port logistics services fit into overall supply chains varies case by case, and ports are often key components of several supply chains running simultaneously and in parallel. ABP’s formal recognition of the business potential in supply chain value addition came in 2001 with the establishment of ABP Connect. A subsidiary company focused on customer-tailored logistics, ABP Connect sees itself as a “one-stop-shop” for transport, shipping and storage with bespoke facilities at four ABP ports (CardiV, Hull, Immingham and Southampton) and at one inland site: Hams Hall, West Midlands. Target flows are high value goods such as perishable food stuVs, cars, paper and steel. The vision of ABP Connect is to simplify logistics by combining its existing cargo handling expertise with the company’s national and international reach. Amongst its capabilities is: unit load solutions, temperature-controlled supply chains, integrated information and date handling, abnormal load transport and chemical logistics. ABP Connect at CardiV have emphasised cold-chain logistics management; elsewhere, the emphasis varies according to need: at Immingham, car-handling is important business and intermodal unit load traYc is the main business at Ham’s Hall where both port-related and Channel Tunnel consignments are received and despatched. The Ham’s Hall terminal is linked to the port of Felixstowe by rail and motorway/dual carriageway. This cross company co-operation was strengthened further in 2004 when the terminal was licensed to operate full customs clearance procedures in deep sea cargo enabling it to act as a fully-fledged inland container depot (ICD). ABP Connect has therefore contributed considerably to the diversification of the company’s traditional marine-focussed portfolio.

Container Shipping Networks The most important influence on UK container ports development is the increasing dependence on import flows from the Far East which acts as a “lead” trade lane with the biggest ships, the largest volumes of cargo and the biggest influence on container port development in Europe. By implication, UK and European port policy as applied to container ports is influenced considerably by trends in deep sea shipping and ship building. Typically, a very large (5th or 6th generation) fully laden container ship discharges a quarter or one fifth of its load in the UK and the rest in ports of continental Europe. This roughly reflects the size of the respective markets but it is also determined in detail by a ships port-call sequence (“rotation”) and by the number of port calls a major line may choose to make in Europe. In general, major lines need call at only one UK port but are happy to call at several European ports within a week or so provided that the volume of cargo justifies the high costs (port dues and cargo handling charges, plus time related costs) incurred in port. Port-call strategies vary, but are driven by maximising cargo pick up/drop oV, ship load factor maximisation, and strategic issues such as market coverage and “having a presence” in as many major ports as possible. If cargo volumes do not keep pace with the growth in ship size, there is considerable pressure to reduce main-line calls (perhaps to only one) and serve an area via smaller “feeder” ships. As container ships have inexorably grown bigger with each “generation”, fewer and fewer ports have been able to accommodate them. Currently,15m water depth is roughly the global standard for accommodating sixth-generation containerships fully-laden. Felixstowe and Southampton are the UK ports best suited to this key requirement: Thames Gateway will also be able to handle such super-large ships in combination with a handful of continental European ports. The lock systems and tidal regimes at South Wales ports leaves them way short of this minimum standard: they can never be incorporated into the north European mainline deep sea shipping schedules. Facing westwards, away from Rotterdam with lock and marine access constraints, the South Wales general cargo/ container ports slot into niche roles rather than fulfilling a national gateway function in the way that Felixstowe and Southampton do, and the former Shellhaven site is expected to. Most high-value unitised freight coming into Wales originates from either the Far East or the EU; in both cases, the majority arrives via east coast ports or Southampton; exports likewise go mostly eastwards. Road and rail links between Wales and England are therefore of paramount importance for Wales’ economic well-being, as well as road/ rail links to the Welsh ports themselves. High value freight logistics solutions are invariably multimodal over long distances.

Observations on Port and Transport Policy In contrast to airport policy, where successive UK governments have applied a medium-to-firm steer, the policy approach to ports has largely been light touch. The 90 or so Trust Ports (fishery plus non-fishery) are interspersed with the 60! local authority “municipal” ports which are mainly small and concentrated in southwest England, West Wales and Kent. These are themselves inter-mingled with a diverse group of fully privatised ports which range from small regional facilities (such as the Trent ports) to some of Europe’s biggest and most important hubs such as Southampton, Immingham, Felixstowe or London. Growing numbers of UK ports or port groups are under non-British ownership. Despite this extreme diversity, the combination of ownership models appears to deliver a high quality of service and, overall, good value for money. For the UK, the long-running mostly “hands-oV” policy has generally allowed enterprise-driven Processed: 29-10-2009 23:00:04 Page Layout: COENEW [O] PPSysB Job: 435922 Unit: PAG7

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initiatives, and logistics concepts from outside the port industry, to influence port operations very positively. The increased focus on integrating ports into supply chains has served to highlight certain capabilities and capacity gaps, however. For example, on the British freight rail network several “capacity gaps” have been identified (Network Rail, 2006 & 2007) which impact, or potentially impact, the ports notably on North Humberside and on the Thames Gateway and Haven Ports routes to the Midlands. In Wales, logistics operations are dominated by two east-west corridors which both serve local, national and international needs. Although congestion on these routes is far less than that seen in North West England, the Midlands and South East England (Eddington, 2006), delays and unpredictability still threaten the eVectiveness of regional logistics services, including delivery of freight to/from the ports. The Port of CardiV lacks an on- dock rail freight terminal for containers, and low-capacity roads and rail links to Fishguard, Pembroke and Milford Haven are also potential pinch-points. With a high proportion of transport costs for high-value unit-load freight being time or distance related, delays or unpredictable schedules translate immediately into higher distribution costs. And as distances between Welsh ports and the main UK and European centres of production/consumption are long, “ineYciency” costs accumulate rapidly and potentially disadvantage the economy of Wales in relation to England quite significantly.

Conclusions and some Policy Pointers Government policy towards Welsh ports cannot be, nor should it be, dramatically diVerent from that applied to other British ports. Collectively, they form the British port system which itself is bound tightly into the European port system and this in turn is driven largely by macro-forces such as intra-European Union trade patterns, globalisation and the dominance of the Far East for deep sea exports into Europe and the UK. However, there are certain important diVerences between Welsh ports and English ports, eg in the profile of port ownership (private/trust/municipal), the landbridge function performed by several Welsh ports, the extreme tidal regime constraining ship size and marine access in the Severn Estuary, the strategic importance of just two key corridors in Wales, and the relative disadvantage Wales has, by virtue of its west- facing aspect, in relation to core EU trade. Port policy for Wales must take account of these diVerences. The vulnerability of certain ports to economic downturn (eg Port Talbot for raw material imports for steel manufacture) also needs to be born in mind. On the other hand, there are opportunities for capturing new traYc, or developing existing flows, in RO-RO (freight only or freight/passenger) and cruise shipping. Likewise, land-land logistics, exploiting the road and rail networks and strategic industrial sites on the dock estate, could be further exploited to supplement and compliment existing sea-land logistics services. Three parallel strategies therefore should be encouraged: — Concentration: in CardiV and elsewhere, an ongoing review of asset utilisation, with a view to increasing yield per square metre/per hectare is to be encouraged. This could lead to the ports focussing on certain key cargoes and reducing the port’s footprint. — Diversification: continue, where possible, the move away from lower value traditional cargoes and towards other freight oVering value-addition opportunities consistent with the business philosophy of ABP Connect. — Integration: supply chains are increasingly required to be multi-faceted and multimodal, run as “chain partnerships”. Sea-rail-road (eg for steel), sea-road-rail (containers) and sea-pipeline (LNG, oil), are examples. It is important to take account of the full range of logistic systems within which the ports fit when reviewing the position of Welsh ports; in many cases they are locked into international supply chains and thus must be viewed in a Welsh, British, European and global context at the same time. June 2009

Written evidence from the British Ports Association and the UK Major Ports Group Executive Summary — Ports in Wales are major contributors to prosperity and employment. — They crucially depend on their infrastructure connections to the transport network. — They require full engagement with policy makers to ensure that policy delivers the conditions for success. 1. This submission is made on behalf of the British Ports Association and the UK Major Ports Group whose members account for the overwhelming majority of cargo and passengers handled by ports in Wales. Both Associations very much welcome the inquiry, the interest it shows in this important sector and the potential to establish a new relationship between WAG and the industry. Processed: 29-10-2009 23:00:04 Page Layout: COENEW [E] PPSysB Job: 435922 Unit: PAG7

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2. Cargo throughput for the latest recorded year (2007) was 57 million tonnes, equivalent to just under 10% of total UK throughput. Passenger movements totalled 3.1 million, equivalent to 13% of the UK total. 3. The Welsh Ports industry can be broken down into four main component parts. There is the ro-ro and passenger traYc handled by Holyhead, Fishguard and Milford Haven; there is the significant oil and energy sector traYc handled by Milford Haven, the largest port in Wales; there are the ports of Newport, CardiV, Berry, Port Talbot and Swansea on the South coast owned and operated by Associated British Ports handling dry and liquid bulk, forest products, iron and steel products and some lift-on lift-oV container traYc; there is a range of smaller ports which are significant for leisure activity. All in all, Wales hosts a broad cross section of port activity. In addition its links with Ireland provide a strategically vital trade route between Ireland, the UK and the Continent. 4. Ports in Wales should be seen in the context of the totality of the UK ports sector, which is the largest within the EU; over 95% of UK imports and exports by volume pass through ports. UK ports are estimated to support 362,000 jobs, including direct, indirect and induced impacts. Ports therefore have significance which goes far beyond their immediate cargo and passenger handling roles. 5. The UK ports industry is characterised by its strategic and financial independence. The three main port models—privatised, trust and municipal—are all strongly represented in Wales. The privatised sector is sizeable in Wales with ports owned by both ABP and Stena Line. Trust ports such as Milford Haven have recently undergone a review of their Guidelines, which will be published shortly. Municipal ports, which include Burry Port and Tenby, were reviewed as a sector in 2005. The connecting thread between all these ownership models is common statutory responsibilities to provide safe navigation, appropriate facilities for users and to have regard to the environmental impacts of operations and developments.

Policy Framework for the Development of the Welsh Ports 6. Currently, ports policy in Wales is non-devolved. However, important decisions on infrastructure connections are devolved to the Welsh Assembly, although the funding is allocated centrally from London. This is quite distinct from Scotland and Northern Ireland where ports policy is a devolved matter and where, as a result, significant diVerences are emerging. In broad terms, ports in Wales support current ports policy in as much as it is based on private sector, free market principles with a minimum of government involvement. Nevertheless, this arrangement still demands a strong relationship with government which, as already mentioned, makes ultimate decisions on road and rail spending and which issues licences and consents on which the proper functioning of the industry depend. 7. The development of Welsh ports therefore is substantially a matter for the ports themselves, identifying market opportunities, providing the right facilities and competing with other ports both within the region and throughout the rest of the UK. There is very little legislation directly aimed at ports; most is of a general nature, such as the Environmental Impact Assessment Regulations. However, specific legislation includes measures on reception of marine waste, security and dredging. The Water Framework Directive will also introduce a rigorous water quality regime which will impact on ports. 8. Links between individual ports in Wales and the Welsh Assembly Government are strong and productive but generally not conducted on the basis of ports acting jointly. The Wales Freight Group, whose members include port operators, developed a Wales Freight Strategy published in 2008. At the beginning of March a group of Welsh ports met the Deputy First Minister to look at a range of issues confronting the industry. As a result a Welsh Ports Group has been established which will meet for the first time in CardiV on 3 June and will involve Welsh Government oYcials. 9. There are two particular policy areas which the Group would like to identify at this stage. The first is the future of the planning and licensing system. Under the Marine and Coastal Access Bill a new Marine Management Organisation (MMO) will be set up. This has been supported by both the BPA and the UKMPG in as much as it will streamline the licensing system and bring together various parts of government which at the moment work separately. We are therefore concerned about the implications of a recommendation proposing that the functions of an MMO should be a WAG responsibility. The MMO brings together functions and personnel within one organisation with a clear remit; any diversion of these functions elsewhere could undermine the principle of a “one stop shop”. Equally, we believe there is a real danger that the recommendation will simply perpetuate the status quo with responsibility for licensing split between various departments. Tied to this is the issue of cost and resources; we are concerned that there may not be suYcient resources for WAG to create the necessary change. 10. The second issue is the adequacy of infrastructure connections. In England, Strategic National Corridors (SNCs) have been identified and maps published. These take into account the major influence ports have on traYc patterns, closely reflecting the recommendations of the Eddington report which highlighted the value generated by good links to ports. The maps published by the DfT show SNCs trailling oV at the Welsh border. It is vital that links, especially through North and South Wales connecting to the rest of the UK and subsequently to Ireland and the Continent, are recognised for their strategic value and are fully funded. The EU Trans-European network initiative (TENs) has benefited road links in North Wales through their identification as Priority Project 13 (although some parts are still not completed). Of equal Processed: 29-10-2009 23:00:04 Page Layout: COENEW [O] PPSysB Job: 435922 Unit: PAG7

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importance are the South Wales connections. If identified as a TENs priority, they could provide a major boost for transport, freight and local communities. More generally, we wish to play a bigger collective role in transport spending decisions with ports at the table and fully consulted. 11. In summary, we believe that much more information about the needs of ports could be exchanged between the ports acting collectively and WAG; these discussions should be on the understanding of the importance of ports both to Wales and to the UK economy.

The Contribution of Welsh Ports to the Local Economy 12. We have already referred to the impact of ports on employment. Although it would be simplistic to allocate 10% of all the benefits generated throughout the UK to ports in Wales as handlers of 10% of the UK’s throughput, nevertheless, the economic contribution will be significant in terms of employment, the value of connected services and other impacts such as tax receipts. To take one example, port operations in Holyhead account for a significant proportion of the estimated 19,000 jobs in Anglesey. Of the 4,500 jobs located in Holyhead itself, the port is responsible for direct employment of over 25% of the local work force with an even larger number of indirect employment impacts created elsewhere on Anglesey. ABP ports support over 16,000 full time equivalent jobs and generate £1.7 billion in value.

Potential to Increase Scale and Range of Trade with Other Countries 13. Ports themselves are not normally initiators of traYc; they are logistics hubs serving the needs of passengers and freight owners. Port markets, though substantial, can be volatile and unpredictable. They closely reflect prevailing economic conditions; they are a barometer of levels of economic activity. Many of the changes for ports in Wales have been driven by the decline of the manufacturing sector, the needs of the energy sector and the fortunes of the Irish economy. Whilst total throughput has remained remarkably steady over the past 10 years, renewable energy and sustainable distribution represent significant opportunities going forward. These include container traYc with the Continent and other parts of the UK, and ro-ro links with Ireland. Ports policy has to create a framework that provides the conditions for success; this will require a continually improving partnership between WAG and Welsh ports focusing on eVective transport links and promoting sustainable distribution.

The Potential to Increase Freight Movements 14. One potential source of new business is the oVshore energy sector. The government’s commitment to renewable energy has been backed up by publication of a report, UK Ports Prospectus which identifies four ports in Wales (Mostyn, Milford Haven, Swansea and Port Talbot) as possible sites for servicing the oVshore renewables sector. This will be substantially new business and apart from the movement of equipment, will require storage and oVshore servicing facilities. 15. In addition to the opportunities identified in paragraph 12, more productive use could be made of the Freight Facilities Grant Scheme and EU initiatives such as “Motorways of the Sea”. Both require good co- operation between ports and government.

Tourism and Cruise Ships 16. Cruise Wales has been recently set up and its members are Holyhead, Milford Haven, Fishguard, CardiV and Swansea. These ports are at various stages of attracting cruise traYc but their cooperation under the Cruise Wales banner, which includes government partners, represents an important initiative. For example, Milford Haven is studying the possibility of developing a new multi-purpose berth facility. In Holyhead 2008 saw the first call of a major cruise ship and WAG is commissioning a feasibility study for berth site facilities. CardiV and Swansea both specialise in smaller, medium size cruise ships. 17. The arrival of a cruise ship can provide a major boost to local economies, but significant investment is required in alongside berths to ensure the volumes of cruise calls are realized in Wales. It is estimated that a cruise ship with 2,500 passengers is worth in the region of £200,000 to the local economy. The marina and leisure harbour sector is also strong in Wales.

Adequacy of Security and Policing in Welsh Ports 18. Under the UK Borders Citizenship and Immigration Bill there are proposals to disband the Common Travel Area and introduce immigration controls, passports and carriers liability. All these are likely to have a significant eVect on the eYcient movement of freight and passengers and we will see the end of the significant benefits that current CTA arrangements have generated. We are concerned that the requirements for all ferry passengers to have a passport will have a significantly greater impact on customers resident in rural parts of Wales than elsewhere in the UK; this could certainly aVect tourism. Strong concern about the Bill’s impact has been expressed in recent debates in the House of Lords, to the extent that the CTA proposals were removed as a result of a vote in the Lords in April. We fully expect that these provisions will be re- introduced in the Commons, but this removal shows the strength of feeling and also the view that current CTA arrangements do not pose any significant security threat to the UK. Processed: 29-10-2009 23:00:04 Page Layout: COENEW [E] PPSysB Job: 435922 Unit: PAG7

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19. All ports in Wales will comply with the Port Security Regulations and will shortly have to comply with the EU Security Directive which will be implemented through new Regulations later this year. We believe that security and policing at Welsh ports are strong but that provision should always be mindful of a fair balance between providing security and eYcient freight and passenger movement. May 2009

Written evidence from CardiV Harbour Authority CardiV has an active port with many businesses based within the port boundary and these contribute to the local economy through employment and trade with other local businesses. In addition to traditional business links CardiV Council actively works with the owners, Associated British Ports, to promote the port, the capital and the region for cruise ship calls and turnarounds. Promotion includes attendance at trade shows, a web presence, PR, production of brochures and itineraries, and direct sales activity resulting in familiarisation trips. The joint work between the port and destination is vital. The port has to provide appropriate facilities and services and the destination is the “magnet”. Tourism professionals have the knowledge of the best fit attractions for the target market, often advising ground handlers. From an operational point of view, the Council assists in providing the welcome, in provision such as banners, singers, bands, knowledgeable tourist information staV, shuttle busses etc.

On the all Wales front we work together to promote CardiV and appropriate South Wales ports with Holyhead and Milford Haven under the Cruise Wales banner.

It should be noted that the other ports have recently achieved European funding as part of an Interreg bid. Unfortunately CardiV is disadvantaged as a non designated convergence area and therefore is unable to access this source of funding to assist the development of the Port.

The Council also works closely with the port over major events. Port land is often used for car parking and other event infrastructure storage and the use of the main docks are also used for the berthing and display of naval and other feature vessels that can be made accessible to the public. July 2009

Written evidence from the Chartered Institute of Logistics and Transport (UK) Cymru Wales Executive Summary 1. Ports are an important part of the Welsh economy, providing opportunities for businesses to access overseas markets. However, in contrast to Scotland and Northern Ireland, the policy framework results in ports coming under the jurisdiction of the Department for Transport. Ports have also diversified their roles within modern supply chains and provide more than a transfer point between sea and land transport. This has emphasised the need for an eVective distribution network within the hinterland to facilitate the movement of goods in an eYcient manner. As a result of these changes, research suggests that the value of the ports network within Wales exceeds 15,000 jobs and £1.7 billion of output (Bryan et al, 2006).

About CILT(UK) Cymru Wales 2. The Chartered Institute of Logistics and Transport (UK) is the pre-eminent independent professional body for individuals associated with logistics, supply chains and transport planning. The Chartered Institute of Logistics and Transport (CILT) International—formerly The Chartered Institute of Transport—was formed in 1919 and was granted its Royal Charter in 1926. Growth of its overseas sections led to a restructuring in 1994 under which 10 national councils were established in various parts of the world. The Institute operates as a co-ordinating body and custodian of the Royal Charter. The Institute of Logistics and Transport was formed in June 1999, following the integration of The Institute of Logistics and The Chartered Institute of Transport in the UK. In April 2004 the Institute’s membership voted in favour of ILT adopting the word “Chartered” into its title. In May 2004 the Institute oYcially became The Chartered Institute of Logistics and Transport in the UK—CILT(UK). 3. In Wales, CILT(UK) Cymru Wales is responsible for the organisation of events for local members and also comments on transport policy issues which apply to Wales. It is on this basis that we are providing evidence to this Committee. We have over 600 members within Wales, including a number employed directly in the ports industry and also supporting activities such as transport planning and academia. Processed: 29-10-2009 23:00:04 Page Layout: COENEW [O] PPSysB Job: 435922 Unit: PAG7

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Introduction 4. Overall, CILT(UK) welcomes this inquiry into the ports industry within Wales. Given the current economic climate, it is essential for the Welsh economy that the logistics network can help support manufacturing industry within the country. Ports provide essential gateways between Wales and the rest of the world, strengthening their importance within the network. Our evidence particular comments on the following areas of the inquiry: — The policy framework for the development of Welsh ports, including co-operation and co- ordination between the UK Government and the Welsh Assembly Government. — The contribution of Welsh ports to their local economies, including: — the potential to increase the scale and range of trade with other countries; and — the potential to increase freight movements through Welsh ports and the adequacy of the transport infrastructure linking ports to their hinterlands and markets, including those outside Wales. 5. We firstly comment on the policy framework for Welsh ports before discussing the role of ports today and finally highlighting some of the economic benefits they bring.

Policy Framework for Welsh Ports 6. In terms of policy, Wales currently diVers from the other devolved governments in terms of its jurisdiction over port policy. In both Scotland and Northern Ireland, the devolved governments have responsibility for setting port policy. In Wales this responsibility remains with the UK national government, although there is coordination with the Welsh Assembly Government. Indeed, the Wales Freight Strategy3 includes substantial reference to ports within it, and it is important that this is reflected in policy decisions from the Department for Transport. 7. However, within the context of this inquiry, we would advise the Committee to consider the benefits from devolving policy making for Welsh ports to ensure their continued competitiveness. Indeed, whereas there may be limited competition between English ports and those in Scotland and Northern Ireland (except for some commodities such as coal), there is much more choice between English and Welsh ports. For example, Holyhead and Mostyn have to compete with Liverpool, while the south Wales ports compete with those on the opposite side of the Severn Estuary, and particularly CardiV, Newport and Bristol. 8. Having said this, it is also important that any Welsh strategy aligns with the UK to ensure no un- necessary competition and wasted investment in duplicate facilities that then become under-used.

Role of Ports 9. Traditionally, the role of ports has been the transfer of goods between surface transport modes (such as road and rail) and water borne transport, and this has influenced the nature of their development and the commodities with which they are associated. 10. As an illustration of this, we would refer the Committee to the academic journal paper written by Dr Anthony Beresford4 which provides a detailed analysis of the development of CardiV until the mid-1990s; Beresford, A (1995) Redevelopment of the port of CardiV, Ocean and Coastal Management, Volume 27, Number 1–2, pp 93–107. 11. Nowadays, ports provide a much wider role than just modal transfer. This includes: — warehousing for imports, exports and domestic traYc; — value-adding activities such as final processing. For example, at the port of CardiV, cat litter is mixed and bagged according to customer requirements before being despatched; and — modal-transfer between surface transport modes. An example (although no longer current) would be the transfer of aluminium ingots between rail and road transport at the port of Newport on behalf of Alcan. 12. Key to supporting port development are connections to the hinterland by land transport modes. In Wales, connections for the onward movement of freight by land transport are varied: — Barry, CardiV, Mostyn, Newport, Port Talbot, Swansea—road, rail. — Milford Haven—road, pipeline. — Pembroke, Fishguard, Holyhead5—road.

3 Wales Freight Strategy available from http://wales.gov.uk/topics/transport/publications/wfs/?lang%en 4 A member of CILT(UK) Cymru Wales. 5 These ports do have passenger rail connections; these are currently not used for freight and would require investment to make them suitable to be so. Processed: 29-10-2009 23:00:04 Page Layout: COENEW [E] PPSysB Job: 435922 Unit: PAG7

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13. For the south Wales ports, one of the major challenges for onwards movements by rail is capacity in the rail network. Freight movements to Barry are constrained by the intensive passenger service on the CardiV Valleys network, particularly through Cogan Junction, while there are also capacity constraints on the main line from CardiV to Swansea. The future aspirations of SEWTA6 are likely to put further pressure on the rail network east of CardiV. 14. The connectivity of ports to the global shipping networks can also influence development, especially container shipping. Currently, the majority of container traYc is transported by road and rail to Southampton and Felixstowe, as these are regularly served by the largest container vessels on global routings. The location of Welsh ports makes it less likely for these services to call, given the orientation of current networks to the English Channel and the Le Havre-Hamburg port range. However, there may be opportunities to encourage feeder ships to these ports, especially additional calls on services from west Scotland and Irish ports.

Economic Contribution 15. In looking at the economic contribution of ports to the Welsh economy, we would like to draw the Committee’s attention to the following paper: Bryan, J, Munday, M, Pickernell, D and Roberts, A (2006) Assessing the economic significance of port activity: evidence from ABP operations in industrial South Wales, Maritime Policy and Management, Volume 33, Number 4, pp 371–386. 16. In this, the authors look to quantify the wider impact of Associated British Ports’ operations in south Wales (Newport, CardiV, Barry and Port Talbot). Amongst their conclusions are the following impact assessments: — ABP directly employs around 200 people and contributes £45 million to the Welsh economy. — Through the industries that either use ABP’s facilities and land, the indirect contribution of the ABP Ports is 15,700 jobs and £1.7 billion of output. Consequently, it can be seen that having an eVective port network within Wales can make a significant contribution to the wider economy and support many local businesses.

Conclusion 17. CILT(UK) believes that this inquiry is timely in terms of recognising the importance of the port network to the Welsh economy, especially given the current economic climate. Through this evidence, we hope to have demonstrated the variety of roles the ports now play and their wider contribution to the local economy. Therefore, it would seem appropriate to consider in some detail whether devolution of port strategy to the Welsh Assembly Government would enhance this contribution, by allowing the alignment of ports policy with other transport and economic development policies. April 2009

Written evidence from Callum Couper, FCILT, Chair, Wales Freight Group Firstly I would like to thank the Committee for the opportunity to make a written and oral submission regarding the Ports in Wales inquiry. I am attending in my capacity as Chair of the Wales Freight Group, a role I have held since its inception in November 2005. By way of background I am employed by Associated British Ports at South Wales Ports and have specific responsibility for management of ABP’s Ports of CardiV and Barry. During the past 23 years I have held a number of senior management posts at ports in the UK and have also been involved with development of freight strategies, including the Wales Freight Strategy and North West Regional Freight Strategy, and sat on several freight advisory organisations.

Wales Freight Group During November 2005 a meeting was organised by the Welsh Assembly Government to receive views from Highway Authorities, freight organisations and freight companies concerning establishment of a Wales Freight Group. Overwhelmingly formation of a freight group was supported reflecting the desire for planners, providers and users of freight services in Wales to participate in a strategic partnership to represent and develop freight transport across all modes in Wales. Concurrent was legislation to devolve rail and road functions to WAG and development of the Wales Spatial Plan.

6 See the SEWTA Final Draft Regional Transport Plan (2008), available at http://www.sewta.gov.uk/PDF/FinalDraftRegionalTransportPlan.pdf Processed: 29-10-2009 23:00:04 Page Layout: COENEW [O] PPSysB Job: 435922 Unit: PAG7

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The Wales Freight Group has approximately 40 participating organisations including Welsh Assembly Government, Regional Transport Consortia, Network Rail, Freight Transport Association, Road Haulage Association, Rail Freight Group, port and shipping operators, airport, rail and road haulage and logistics companies, Skills for Logistics, and the Sustainable Development Commission Wales. Specific to ports a Wales Port Group representing almost all commercial ports in Wales is in the process of being established within the existing Wales Freight Group structure.

Wales Freight Strategy During its first two years the Wales Freight Group focussed on development of the Wales Freight Strategy which links to the Wales Transport Strategy and it is designed to: — assist Regional Transport Consortia in the development of Regional Transport Plans; — identify and promote factors supporting sustainable distribution systems; — support Welsh industry and commerce with a reliable and cost eYcient network for raw materials, and manufactured and consumer goods; — anticipate and respond to fundamental changes in the supply chain and markets; — identify weaknesses and constraints in the existing freight network which may impact on the Welsh economy; and — integrate and maximise use of existing freight infrastructure, using all transport modes to the benefit of the environment and economy. The strategy is broken down modally into road, rail, ports & shipping, air and pipeline. Ports are considered regarding environmental benefits of sea borne freight, surface transport links, regional and international connectivity and trade, economic development potential, trends in supply chain and market shifts and opportunities for Welsh ports.

Welsh Ports Ports are essential to trade and facilitate investment and employment. At their simplest they are the land sea interface where cargo can be loaded and discharged from vessels however ports also have storage and transit facilities, act as distribution hubs, support value added activities and in some cases full scale manufacturing on or close to the port estate. Ports may be quite specific in their function, specialising for example in containers, ro-ro, oil, or exhibit a broad range of cargo types delivering into an extensive hinterland. They are economic drivers important to the region, or nationally, and are key to the manufacturing, retail, energy, agricultural and construction sectors also permitting ships to be positioned closest to the point of destination or origin of cargo, minimising onward distribution costs and environmental impacts. An eYcient port with good surface transport links provides a cost eVective route to market and raw material access for indigenous manufacturing and retail businesses and can also be a strong part of Wales’ inward investment oVering in a competitive global economy. During 2007 ports in Wales handled 56,597,000 tonnes of cargo c 10% of total UK seaborne trade. Two key facilities of UK national significance are Milford Haven and Port Talbot, the latter being one of only three harbours in the UK being able to accept fully laden cape size vessels. Crude oil/products at Milford and raw materials for steel production at Ports Talbot comprise c 75% of Welsh seaborne trade. Wales plays a key role for unit load trade to Ireland both UK origin and land bridge traYc. The three key ports of Holyhead, Fishguard and Pembroke (Swansea currently attempting to re-establish Cork services and Mostyn has a dedicated ro-ro berth) handle this in roll-on/roll-oV mode in addition to container services from CardiV. Unit load comprises 5,171k tonnes which, stripping out the Milford and Port Talbot bulk cargo is c 38% of Welsh port volumes. The remaining trade is concentrated on the South Wales ports at Swansea, Barry, CardiV and Newport that handle a broad range of cargoes and service hinterlands beyond Wales into the Midlands, M4 corridor and South West. The main Welsh commercial ports and their trade characteristics, including 2007 throughput, are: — Mostyn. 154k tonnes. Airbus 380 wings, steel coil and wind farm projects. 79% exports. Ro-Ro capacity. — Llanddulas and Penrhyn. 398k tonnes. Majority limestone export at Llandullas and some aggregate/dry bulk at Penrhyn. 88% exports. — Holyhead. 3,468k tonnes. Ro-Ro port for driver accompanied freight and passenger traYcto Southern Ireland. Also dry bulk imports for aluminium smelter & visiting cruise vessels. 54% exports. — Fishguard. 571k tonnes. Ro-Ro port for Southern Ireland trade. 41% exports. Processed: 29-10-2009 23:00:04 Page Layout: COENEW [E] PPSysB Job: 435922 Unit: PAG7

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— Milford Haven. 35,495k tonnes 96% of which comprises liquid bulks, including crude oil, oil products, LNG. Ro-Ro services at Pembroke for Southern Ireland. 54% exports. — Swansea. 683k tonnes. Dry bulks including coal, fertiliser and cement, steel, aggregates forest products, projects. Ro-Ro capacity. 24% exports. — Neath River. 420k tonnes. Aggregates, steel, scrap. 32% exports. — Port Talbot. 9,052k tonnes. Iron ore, coking coal, limestone some general cargo and aggregates. 3% exports. — Barry. 456k tonnes. Mainly liquid bulk chemicals also forest products and scrap. 26% exports. — CardiV. 3,057k tonnes. Petroleum products, chemicals, steel, scrap, forest products, container services, dry bulks. 17% exports. — Newport. 2,328k tonnes. Steel, scrap, forest products, dry bulks including coal, cement and fertiliser, aggregates, projects, military stores. 24% exports. — Usk River. 515k tonnes. Steel, dry bulks, scrap, aggregates. 10% exports.

Key Issues The headline message is that ports act as economic drivers within a region and provide opportunities for existing and future economic activity that enhance competitiveness and investment. Ports can also facilitate environmentally sustainable development when sea and/or rail transport is utilised and/or development takes place close to the port. Grouping some of the key issues together: Road and Rail Infrastructure—EVective road links to the motorway network, freight corridors, regional and strategic. EVect of Severn Crossing tolls. Future capacity and capability of the rail network for freight (including W 10 loading gauge capability). Connectivity—International connections for Welsh manufacturers and retail trade may be achieved through feeder vessel connections to deep-sea container hubs. Strengthening transport links to global services and intercepting other UK trade into the Midlands/M62/M4 corridors. Economic and Transport Planning—Understanding ports as economic drivers as part of the inward investment oVering. Prominence of port facilities in Regional Transport Plans and LDP’s. Linking strategic employment sites with port oVering. Potential for port centric logistics and value added activity. Sustainable Distribution—Ports can oVer great opportunities to promote sustainable distribution of goods by coastal shipping and feeder services, thereby reducing environmental impacts and pressure on congested road and rail networks. Many ports in Wales are working hard to realise this potential; however, the right environmentally focussed policy framework and support from government is also essential. Energy—Import of fuels, fossil and renewable. Bio fuel processing and electricity generation on or close to port estate. Wind farm construction/service base. National grid connection points/ capacity/reinforcement. Cruise—Currently cruise vessels make port calls at Holyhead, Milford and occasionally Swansea/ CardiV benefiting the local economy. Future potential for UK based cruise departure/return to Welsh ports. Grant Regime—Environmental benefits of sea transport over long haul road. Limitations of TEN- T Marco Polo/MOS grant regimes to UK projects. Dredging—Most ports require their navigation channels and berths to be dredged to maintain vessel access and the spoil disposed of at licensed disposal sites in their proximity. This process has been ongoing as long as the port itself and is essential for port operation. Restrictions on disposal of dredged arisings may severely limit a port’s ability to operate with trade being displaced to other ports out with the hinterland increasing long distance road haulage. 21 May 2009

Written evidence from Cruise Wales Objective To develop and promote Wales as a major cruise destination in northern Europe and to achieve that vision by building new alongside berths at Holyhead and Milford Haven to accommodate the largest cruise ships in the world and by using the existing port facilities at CardiV, Pembrokeshire and Swansea for the smaller niche cruise lines. Processed: 29-10-2009 23:00:04 Page Layout: COENEW [O] PPSysB Job: 435922 Unit: PAG7

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Cruise—The Market Potential Introduction The cruise industry has shown dramatic growth over the last 10 years with demand for cruising more than doubling. Its potential to continue to grow remains, with as yet only 3% of the US population presently cruising and in the UK only 2%. Furthermore, other European markets are seeing large growth in the cruise sector. Notably, Germany growing by 19% in three years, Spain by 24% and Italy by a staggering 49%. In 10 years from 1995 to 2005 the numbers of Europeans cruising trebled and this is predicted to continue apace. Northern Europe as a cruise ground has grown as the industry has developed and is particularly attractive to the cruise lines as it produces the highest yield per cruise passenger (price of cruise and the highest revenue for shore excursions). In 2005 87 cruise ships were active in Northern European waters, 24 were deployed by North American lines and 49 vessels from European cruise lines. Since then even more operators have entered the arena, notably Carnival (homeport Dover 2008), MSc Cruise Line (homeport Dover 2007 with additional vessels in 2008), RCL/Celebrity (homeports Harwich and Southampton), NCL (home port Dover and Southampton). New vessels have also been introduced by existing operators (eg Fred Olsen (Boudicca and Balmoral), Cunard (Victoria)). The justification for developing the strategy includes: 1. The need for new cruise grounds 50 new vessels are due to be launched into the market between 2007–12. The new builds represent from Carnival 141,000 berths, RCL/Celebrity 69,348 berths, Star Cruises/NCL 30,000 berths, MSC 13,256 berths. It should be noted that some 90% of the cruise line fleet in the world is controlled by these four companies. New cruise grounds will be needed to satisfy the demands of the lines and their customers and the Welsh ports can form part of a number of itineraries: — the Irish Sea Cruise (developing upon the already established Ports of Cork and Dublin); — the round British Isles Cruise (Holland America already call at Milford on such an itinerary); — the Celtic Fringe Cruise including Northern Iberia, the Bay of Biscay and the Irish Sea; — Irish Sea and Iceland Cruise (Irish Ports are already part of this itinerary); and — Irish Sea to/from Northern America (Transatlantic). 2. Increasing Size of the Ships in European waters If Milford and Holyhead build alongside facilities they will be able to handle any cruise ship operating worldwide. Cruise ships of over 300 metres carrying in excess of 3,000 passengers are now being introduced into the Northern European Market. The Irish Sea will have a unique opportunity to oVer a cruise for these mega ships (eg Southampton as the home port a cruise could include Cherbourg, Cork, Holyhead, Greenock and Milford Haven). Originally, it was assumed that the new mega cruise ships would be deployed in the Caribbean and the displaced smaller vessels (250 metres LOA, 2,500 passengers) would be put in the European cruise area. However, 2007 and 2008 have shown this not to be the case with new vessels being put straight into the European market. 3. Cruise Season The season in European waters has lengthened, now commencing in April and going through to October. Turnaround calls in the UK are now operating throughout the year and the introduction of mini-cruises (three to four days) to develop the market are not only growing but taking place throughout the year. 4. Passenger requirements The Irish Sea cruise ground has huge potential to expand because it oVers unique opportunities for all areas of the market: — the Americans seeking out their roots or wanting to travel to English speaking countries for their first trip abroad; — the Spanish/Italians seek a colder climate in the height of their Summer (this also applies to US passengers living in the humid Southern states); — the Germans, Dutch and Scandinavians, who are often well travelled so seek more culture and wildlife tours; — children (a growing and targeted group by the mass market lines) activity based tours— cycling, white water rafting, canoeing, horse riding, etc; and — the untapped markets of Eastern Europe and the Far East. Processed: 29-10-2009 23:00:04 Page Layout: COENEW [E] PPSysB Job: 435922 Unit: PAG7

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5. Potential Cruise Calls If potential cruise calls had been assessed two years ago, it would have been estimated that the likely number of calls for Wales would have been around 30 per year. However, the market has changed and the lines are hungry for new itineraries and therefore the potential for growth is considerable. Sixty calls per annum is a more than achievable target with the possibility of growth of up to 80 calls per year. Whilst the Welsh ports will remain a Port of Call, it is also possible that some of the larger cruise lines will allow Welsh passengers to board the cruise at the port. The Italian Lines of MSC and Costa have already started embarkation/disembarkation at all ports on a cruise. Holyhead is particularly suitable for this at it already possesses a modern under-utilised passenger terminal and therefore further investment for turnaround calls are not necessary. In the smaller ports of Swansea and CardiV refurbished warehouses can be used to handle the passengers. Whilst long term contracts with the lines are not usually forthcoming, it will be possible to do three/ five year agreements and incentives for multiple calls. Fred Olsen has already requested charges for regular calls and it is hoped that they would do a longer term deal for the right package. The largest cruise line group Carnival have also indicated that they would accept a passenger port improvement fee similar to that which they already operate in the Caribbean if facilities were developed and Holyhead’s proposals have already been discussed with all the lines in their group. 6. Other factors influencing a Cruise Call Given the increased cost of bunkers and its impact on the overall profitability of the lines, the Irish Sea cruise ground should oVer an attractive opportunity. The area oVers short steaming distances between ports yet is able to provide very diVerent tour oVerings at each destination. Milford Haven’s ability to oVer attractive fuel provisions will also be a major reason for the lines wanting to call. Furthermore, given available tank storage near the proposed development, the easy disposal of grey water and the provision of fresh waters will also be an attraction. The retail outlets and visitor attractions within walking distance of the ship are important to the lines, not only for the passengers but for the crew who exert considerable spending power. All Welsh ports oVer free shuttle buses to the town centres; with the exception of Holyhead these are funded by the local councils. In Holyhead the Port Authority Stena provide the transport. All cruises oVer themed night dinners to reflect the port of call. These will provide opportunities for the sale of Welsh produce (lamb, beef, fish, etc). Regent Seven Seas purchased water at Holyhead this month and Silverseas who will be calling in CardiV in 2010 have already indicated their intention to purchase stores. June 2009

Written evidence from the European Commission Terms of Reference The Welsh AVairs Select Committee has agreed to undertake an inquiry to examine: — The policy framework for the development of Welsh ports, including co-operation and co- ordination between the UK Government and the Welsh Assembly Government. — The contribution of Welsh ports to their local economies, including: — the potential to increase the scale and range of trade with other countries; and — the potential to increase freight movements through Welsh ports and the adequacy of the transport infrastructure linking ports to their hinterlands and markets, including those outside Wales. — The development of tourism and the potential for attracting cruise ships to Welsh ports. — The adequacy of security and policing provision at Welsh ports.

I. European Port policy—Favouring appropriate port development as a general policy 1. After a thorough consultation of the sector, in October 2007 the Commission adopted a Communication on European Ports Policy.7 The Communication: — sets out the main lines of the European Ports Policy; — includes the assessment by the Commission of the current situation and indicates its general objectives. One of those objectives is port development, balancing the needs of the market, spatial planning by national authorities and environmental protection; — sets up an action plan for the realization of the objectives in question with specific actions in the diVerent fields; and

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— includes an interpretation of the Treaty rules on freedom of establishment and freedom to provide services to the port sector, namely to port concessions, technical-nautical services and work in ports. 2. The action plan includes the adoption of guidelines on State aid to port infrastructure and on the application of environmental rules to port development.

II. Specific instruments for port and maritime trades development : State aid to short sea shipping 3. In order to encourage the modal shift from road to sea, a new category of State aid has been introduced in the 2004 Guidelines on State aid to maritime transport (Chapter 10 of the Guidelines).8 4. Aid up to 30% of the operational cost and up to 10% of investments may be granted for the start-up phase—ie, three years—of new initiatives in this sector. Initiatives may consist of new maritime links— domestic or intra-Community—or the enhancement of existing ones. Recipients (in principle shipping companies) will have to be selected by means of a tender procedure. 5. It should be borne in mind that the Guidelines have retained a notion of short sea shipping which only includes transport between ports located in the EU.

III. Financing of Motorways of the Sea under the Marco Polo Programme 6. The European programme Marco Polo II (EU funding)9 aims at promoting the shifting of freight carried by road to more environmental friendly modes of transport, including maritime transport. The programme encompasses five sets of actions, one of them being the development of “motorways of the sea”, specifically aimed to shift freight from road to short sea shipping or a combination of short sea shipping with other modes of transport. Main features of motorways of the sea projects are: — maximum subsidy is 2 EUR per 500 tonne-km shifted oV the road; — minimum project size is 1,25 billion tonne-km shifted over the total length of each contract; — subsidy rate can be up to 35% of eligible costs; — subsidy is available for up to five years; — preparatory measures and infrastructure ancillary to the action can be supported; — supported action has to be innovative; and — the project has to be viable after the end of the subsidy (which therefore only covers the start-up period). 7. Marco Polo is open to private and public undertakings (legal persons or entities) engaged in commercial activities. Participants may come from EU Member States, or “close third countries”. Projects must demonstrate a European dimension to be eligible for support. They must cover an international route, either only involving EU territory or EU territory and the territory of a close third country. 8. The latest Marco Polo call was closed on 8 May 2009. Next call will be at the beginning of 2010. 9. It should be noted that with respect to Marco Polo selected projects for which no EU funding is available or the available EU funding is less than the maximum amount that can be granted to the initiative, Member States may provide complementary State aid in order to achieve the maximum intensity and duration (35% over five years).10

IV. Financing of Motorways of the Sea under TEN-T 10. Under the TEN-T Guidelines11 Motorways of the Sea, as priority projects, can benefit from the multi-annual programmes (some 310 millions Euros available over the period 2007–13). Intensity of funding is 20 or 30% maximum for works and 50% for studies. For start-up aid (investments), funding is 30% maximum during two years. Member States may provide complementary State aid in order to achieve this maximum intensity and duration. 11. Both private and public undertakings and public authorities can apply for funding to the TEN-T programme. However, projects have first to be pre-selected through calls for proposals organised jointly by at least two Member States and have to be explicitly approved by the Member States. The North Sea states organised such a call in 2008 but did not receive project proposals. They may organise a new call in 2009.

8 Commission Communication C(2004) 43—Community guidelines on State aid to maritime transport (OJ C 13, 17.1.2004, p3) 9 This programme was established by Regulation (EC) No 1692/2006 of the European Parliament and of the Council of 24 October 2006 establishing the second “Marco Polo” programme for the granting of Community financial assistance to improve the environmental performance of the freight transport system (Marco Polo II). 10 See Communication from the Commission providing guidance on State aid complementary to Community funding for the launching of the motorways of the sea (OJ C 317 of 12.12.2008, p 10. 11 Decision 1364/2006/EC laying down guidelines for trans-European energy networks. See also Regulation 1159/2005 laying down general rules for the granting of Community financial aid in the field of trans-European networks. Processed: 29-10-2009 23:00:04 Page Layout: COENEW [E] PPSysB Job: 435922 Unit: PAG7

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12. TEN-T Motorways of the Sea projects link infrastructure works to upgrading of maritime links and involve at least two ports and a maritime operator. Facilities and infrastructure open to all users on a non- discriminatory basis can be funded. These can include elements such as: — dikes, breakwaters, locks and other high water protection measures; — lights, buoys, beacons; floating pontoon ramps in tidal areas; — infrastructure for utilities up to the terminal site; — direct land and sea access to port, including short connecting links to the national transport networks or to the TEN-T network and connections to intermodal centres with a high potential of concentrating freight on the MoS, port facilities, eg equipment available to all users; — electronic logistics management systems; — information systems, including traYc management (VTMIS) and electronic reporting systems; — safety and security measures; — administration and customs; — waterways and canals linking two European Motorways of the Sea or two sections thereof, substantially shortening sea routes; — facilities for dredging; and — icebreakers and facilities for icebreaking for winter access. 13. The TEN-T Guidelines will be reviewed next year and a broad consultation in this respect is already being carried out.

V. Ports funding under the TEN-T 14. Under the TEN-T Guidelines12 Ports can only benefit from the annual programmes (some 100 millions Euros available annually), as only priority projects have access to multi-annual programme (some 6 billions Euros) and port projects are not. 15. Both private and public undertakings and public authorities can apply for funding. However, projects have to be backed by the relevant national representative in the TEN-T Financial Committee. For this reason almost all the projects are “public”. Calls for ports are normally published in March each year and are open for two months. Intensity of funding is 10% for works and 50% for studies. 16. Works regarding access infrastructure are funded with priority, such as breakwaters, fairway dredging, as well as TEN-T hinterland connections from ports to the rest of the TEN-T network (locks, rail and road connections). Adaptation of ports to environmental requirements is also financed (eg areas for oil and waste dumping). Terminals are in principle not funded. 17. As mentioned, the TEN-T Guidelines will be reviewed next year.

V. Study by the European Commission on tourist facilities in ports 18. The Communication “An Integrated Maritime Policy for the European Union”13 stresses the importance of reconciling “economic development, environmental sustainability and quality of life” within coastal regions. “The sea is determinant for coastal and maritime tourism, which has been a major catalyst for economic development in coastal areas of Europe. The Commission will work more actively with stakeholders in developing a sustainable tourism policy that takes coastal and maritime tourism into account.” (Section 4.3). 19. Against this background, the Commission has launched a study to analyse the benefits for ports to invest in infrastructure and facilities for receiving tourists, notably through cruise tourism. The study will provide: — clear facts on the benefits and costs of investing in tourist facilities in ports; — more clarity about the opportunities and threats associated with investments in sustainable tourism facilities in and around ports; — insights in the costs associated with compliance to the increasingly stringent environmental rules or to provide environmentally sustainable facilities; and — an indicator to calculate the “return on investment” when investing in tourist facilities in ports. 20. The study will be published in September 2009.14

12 Decision 1364/2006/EC laying down guidelines for trans-European energy networks. See also Regulation 1159/2005 laying down general rules for the granting of Community financial aid in the field of trans-European networks. 13 Communication from the Commission to the European Parliament, the Council, the European Economic and Social Committee and the Committee of the Regions—An Integrated Maritime Policy for the European Union UCOM(2007) 574 final). 14 Information on this ongoing study is available at http://ec.europa.eu/maritimeaVairs/tourist facilities en.html Processed: 29-10-2009 23:00:04 Page Layout: COENEW [O] PPSysB Job: 435922 Unit: PAG7

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VI. Maritime security 21. Three Community legislative measures apply to port security: Regulation 725/2004, Directive 2005/ 65 and Regulation 324/2008. 22. The main objective of the Regulation is to enhance ship and port facility security in the face of threats posed by intentional unlawful acts. The Regulation is intended to provide a basis for a harmonized interpretation and implementation of special measures to enhance maritime security adopted by the Diplomatic Conference of the International Maritime Organization (IMO) in 2002. 23. The Directive completes the mechanism provided for under the Regulation by establishing a security system for all port areas, in order to ensure a high and comparable level of security for all European ports. The aim of the Directive is to improve security in port areas not covered by the Regulation without creating additional obligations in areas already governed by the latter. 24. Finally, inspections conducted by the Commission in order to monitor the implementation of the above-described provisions are currently governed by Regulation 324/2008. June 2009

Written evidence from Fred. Olsen Cruise Lines Introduction 1. Fred. Olsen Cruise Lines (FOCL) is part of the Fred. Olsen Group of companies listed on the Oslo stock exchange which includes cruise and passenger shipping trade as well as ships’ crewing, shipbuilding and oVshore industries. 2. The cruise company operates five cruise vessels, Balmoral, Braemar, Black Watch, Boudicca, Black Prince. The headquarters are based in oYces in Ipswich, SuVolk. 3. The company carries over 100,000 passengers per year across approximately 125 cruises. 95% of the passengers are British, the remainder being predominantly European and American. 4. FOCL conduct turnaround operations in the ports of Southampton, Portsmouth, Dover, Newcastle, Rosyth, Greenock and Liverpool and call to many other ports in the UK during cruises. Fred. Olsen Cruise Lines invite the Committee to consider the following submission.

Executive Summary 5. Fred. Olsen Cruise Lines has been steadily increasing the number of cruises that call at UK and Irish ports. The number of Welsh calls on these itineraries is disproportionally low when compared to other parts of the UK and Ireland. 6. The company has already investigated the possibility of operating cruise turnarounds in Wales but was unable to find a location with adequate facilities. 7. FOCL has a desire to conduct limited turnaround operations in Wales and to increase the number of transit calls subject to facilities being made available at economic costs.

Fred.Olsen Cruise Lines’Operations in Wales 8. Since 2004 FOCL has made two calls to Holyhead and three calls to Milford Haven. We have one further call planned in 2010 to Milford Haven. 9. In the same period (2004 to 2009) FOCL has made a total of 53 calls to Dublin and numerous calls to Scottish and English ports on UK cruises. 10. In May 2008 FOCL visited the port of CardiV to establish if vessel turnarounds could be conducted. Regrettably we found that the port did not have adequate facilities and we have shelved any plans to operate cruises from the south Wales region. FOCL believes there is suYcient demand in the region to operate a limited number of cruises from a Welsh home port.

Facilities Development 11. The requirement for facilities falls into two clear categories according to the nature of the cruise call. Transit calls (sometimes referred to as way-port calls) and Turnaround calls. 12. Transit calls occur part way through a voyage. Typically the vessel will arrive between 0800 and 0900 and it will depart around eight hours later. Passengers will undertake organised shore excursions or explore the port independently. The European Cruise Council (ECC) estimates that such calls are worth ƒ50 per passenger carried to the local economy. 13. Transit calls can be made at anchor and the passengers transferred ashore by the vessel’s tenders or local boats. As a cruise line we prefer to avoid tendering passengers as the process can be slow and there is an increased risk that the call would have to be abandoned in poor weather conditions. Processed: 29-10-2009 23:00:04 Page Layout: COENEW [E] PPSysB Job: 435922 Unit: PAG7

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14. Turnaround calls occur at the start and end of each cruise. Typically the vessel will arrive before 0700 and discharge baggage and garbage. Passengers will disembark and normally the vessel will be clear of passengers by 1000. The vessel will often take on stores and bunkers (if available) and the embarking passengers will begin to arrive around 1300. The vessel will then depart on the next cruise at around 1700. The ECC estimates that such calls are worth ƒ100 per passenger carried to the local economy. 15. Transit calls therefore require little in terms of facilities. The essential requirements are: (i) A safe approach in a wide range of conditions. (ii) Towage available but not compulsory. (iii) A suYciently long, well fendered berth, in good condition, free of hazards. (iv) An area immediately adjacent to the vessel in which to marshal and dispatch excursion coaches and shuttle buses. (v) Fast and eYcient customs and immigration clearance. 16. Turnaround calls require a lot more in terms of facilities and equipments. In addition to the points above, in order to eVect a good turnaround the vessel must be provided: (i) Baggage handling and screening equipment. (ii) Provisions marshalling area. (iii) Provisions handling equipment. (iv) Car Parking. (v) Check-in areas. (vi) Waiting lounges with PA systems. (vii) Refreshment outlet and toilets. (viii) Passenger screening equipment. (ix) Skilled staV. 17. FOCL would conduct more operations in Welsh ports if the above facilities were made available at economic costs.

What Makes an Attractive Destination 18. The “destination” is not limited to the area in the immediate vicinity of the port. It is not unusual for the port to be some distance from the main attractions. For example Civitavecchia is often used for making visits to Rome, some two hours away by coach transfer. 19. The following are the essential ingredients for making a port attractive to both the cruise line and its passengers: (i) A community that really wants us to call. (ii) EYcient ship’s clearance by Customs & Immigration oYcials. (iii) Economic port charges. (iv) A great quayside welcome when the ship arrives. (v) Well trained guides. (vi) Good quality transportation. (vii) Free shuttle service from the port to town. (viii) A good tourist information service. (ix) Tour operators who fully understand what cruise lines want. (x) Interesting attractions within easy reach of the port to suit all age groups and abilities. (xi) A friendly and exciting send oV for the ship to end a successful day’s visit on a high note. 20. The area immediately surrounding the vessel should be pleasant in appearance. It is not possible to disguise a working port as anything else but thought should be given to the general tidiness and cleanliness of the berth. Processed: 29-10-2009 23:00:04 Page Layout: COENEW [O] PPSysB Job: 435922 Unit: PAG7

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21. The destination will need to have at least four excursion options, examples of such (from St Peter Port and Belfast) are contained within the annex. June 2009

Annex A GUERNSEY, CHANNEL ISLANDS Tour A Island Tour Duration: 3 hours Participants: Limited to 160 Experience the historic sights and beautiful scenery of Guernsey as we enjoy a panoramic tour around the island. Departing from the pier, we will drive alongside the harbour seafront, past the 12th century church of St Peter Port and up to the top of Las Val des Terres. We continue through St Martins Village and to the Little Chapel, which is the smallest consecrated church in the world, built as a labour of love. The design, based on the Grotto at Lourdes, is decorated as a mosaic with shells and donated fragments of Wedgewood and Royal Doulton china. Following a brief stop here, we continue through country lanes to the west coast, where we will make a photo stop to capture the beautiful seascape from the high vantage point of Pleinmont cliVs. We shall view Les Hanois Lighthouse, and the ruins of an ancient watchtower where the French author Victor Hugo received inspiration for his epic work Toilers of the Sea. Descending the hill, we will see the natural fishing harbour of Rocquaine Bay and the Martello Tower of Fort Grey. We shall then stop for refreshments and a slice of traditional Guernsey Gache at a tea room overlooking the beautiful bay. Our coach continues along the west and north coasts, past the glorious sandy beaches of L’Eree and Vazon and huge granite rock formations at Cobo Bay, before turning inland and returning to the harbour. Tour Notes: There is very little walking involved in this tour—approximately 300 metres (985 feet) at the Little Chapel, 50 metres (165 feet) at Pleinmont Point and 10 metres (33 feet) at our refreshment stop. There are approximately 12 steps to negotiate at the Little Chapel. Unfortunately the Little Chapel is not wheelchair accessible, however passengers can remain outside or on the coach if they wish. Toilet facilities are available at the tea rooms. To avoid congestion at the sites, this tour may operate in a diVerent order to that described.

Tour B Floral Guernsey Duration: 4 hours Participants: Limited to 30 per departure On this tour we can experience the sights and sounds of a Freesia Centre, relax amidst five acres of beautiful landscaped gardens at the Gold & Silversmith Workshop and visit a privately owned award winning cliV top garden in the country parish of St Martins. Departing from the pier, we shall drive to the Freesia Centre, where we shall see the freesias at diVerent stages of development. One of the large glasshouses here is kept in full bloom for us to enjoy the scent and colours of this delicate flower. Next, we travel along the west coast and through Kings Mills, an area of natural beauty with many traditional Guernsey farmhouses, before reaching the Gold & Silversmith’s Workshop. The workshop is situated in a country lane amidst five acres of landscaped gardens. Here, at the Pavilion Restaurant, we shall have a cup of tea or coVee and a piece of traditional Guernsey Gache. Once refreshed, we shall drive past the Little Chapel (viewed from the coach only) and on to the cliV top garden in St Martins parish. Here we will have time to enjoy the sights, scents and colours of the diverse plants, which thrive in the Mediterranean climate, on our private visit to this award-winning garden. For those who wish to experience a short cliV walk, our guide will walk with us from the garden to the cliV path and viewpoint above Fermain Bay. Please note that, should our call fall between April and early June, there will also be a chance we can instead view the exquisite, natural Bluebell Wood. Alternatively we may stay in the garden or wait on the coach. After the optional short walk along the cliV path, or through the wood, we return to our coach and drive back to the harbour. Processed: 29-10-2009 23:00:04 Page Layout: COENEW [E] PPSysB Job: 435922 Unit: PAG7

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Tour Notes: This tour involves a moderate amount of walking. There is approximately 300 metres (985 feet) of walking at the Freesia Centre, 100 metres (330 feet) at our refreshment venue, 500 metres at the Private Garden in St Martins over sloping ground (and an optional walk of 800 metres which is sloping and uneven). There are approximately 10 steps to negotiate at the refreshment stop. Toilet facilities are available at the Freesia Centre, our refreshment stop and at the Private Garden.

Tour C Herm Island Tour Duration: 3 hours Participants: Limited to 50 participants Just three miles oV the coast of Guernsey and a quick 20-minute boat ride away lies this beautiful little island paradise with a beautiful coastline, wild flowers, sparkling blue sea, pretty harbours and white sandy beaches. Herm Island, which measures just a mile and a half long and half a mile wide, has all we could wish for—there are no cars, no crowds and definitely no stress.

Upon arrival at the harbour, we will take an approximate 60-minute walk across the common to Shell Beach, where we won’t be able to resist walking along the strand looking for shells. The path continues to Belvoir Bay, a little sandy lagoon, perfect for relaxing with an ice cream on a hot day. A woodland path stretches up to the top of the island, where we can visit the little church of St Tugual, which dates from the 10th century.

Once we have descended the hill, we can purchase a snack if we wish (at our own expense) and enjoy some free time to explore the small shops, which stock a variety of gifts and souvenirs.

We return by boat to either Guernsey harbour or the Rosaire steps (depending on tidal conditions).

Tour Notes: This tour is not suitable for wheelchair users or passengers with limited mobility, as it is predominantly a walking tour. A variety of terrain will be encountered, including steep slopes, cliV paths, beach paths and grass. Public toilet facilities are available outside Mermaid Tea Gardens and at Shell Beach. Passengers are advised to wear comfortable shoes and to come prepared for the weather conditions on the day.

Tour CX Herm Island Tour Duration: 5 hours Participants: Limited to 50 participants Just three miles oV the coast of Guernsey and a quick 20-minute boat ride away lies this beautiful little island paradise with a beautiful coastline, wild flowers, sparkling blue sea, pretty harbours and white sandy beaches. Herm Island, which measures just a mile and a half long and half a mile wide, has all we could wish for—there are no cars, no crowds and definitely no stress.

Upon arrival at the harbour, we will take an approximate 60-minute walk across the common to Shell Beach, where we won’t be able to resist walking along the strand looking for shells. The path continues to Belvoir Bay, a little sandy lagoon, perfect for relaxing with an ice cream on a hot day. A woodland path stretches up to the top of the island, where we can visit the little church of St Tugual, which dates from the 10th century.

Once we have descended the hill, we can purchase a snack if we wish (at our own expense) and then enjoy our free time. We may wish to relax on the beach near the harbour, watch the boats or venture onto the cliV paths overlooking the small island of Jethou. There are small shops, which stock a variety of gifts and souvenirs.

We return by boat to either Guernsey harbour or the Rosaire steps (depending on tidal conditions).

Tour Notes: This tour is not suitable for wheelchair users or passengers with limited mobility, as it is predominantly a walking tour. A variety of terrain will be encountered, including steep slopes, cliV paths, beach paths and grass. We should have a couple of hours of free time. Public toilet facilities are available outside Mermaid Tea Gardens and at Shell Beach. Passengers are advised to wear comfortable shoes and to come prepared for the weather conditions on the day. Processed: 29-10-2009 23:00:04 Page Layout: COENEW [O] PPSysB Job: 435922 Unit: PAG7

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BEACH ACTIVITY TOUR Duration: 3 hours Participants: Maximum of 32 Enjoy an organised beach party with your family, on one of Guernsey’s most spectacular beaches. All you need to bring is your towel and swimsuit and leave the rest to us! Choose from a selection of kayaking, beach games, raft building and volleyball—all will be organised and closely supervised by professional instructors who will make sure that we get the most out of our time on the beach. On the day of our visit we will have a fun filled two and a half-hours on the beach, after the transfer to our chosen location. Once there, we will be welcomed by the group leader and divided into teams—which will be alternated throughout the activities in order to have as much fun as possible. At the end of the time on the beach, we will be transferred by minibus back to the harbour. Tour Notes: Children MUST be accompanied by an adult. This tour is most suitable for children aged eight and over, although all are welcome to participate. Come already wearing swimwear under casual clothes and bring towels and sun protection—a warm jumper or jacket is also advised. There are no changing rooms or showers, but public toilets are available. It is a good idea to bring a bottle of water.

BELFAST, NORTHERN IRELAND Tour A Belfast City—A Historic Tour Duration: 3° hours Belfast, the capital of Northern Ireland, has mixed modern development with historic buildings to create a lively and attractive city. Belfast welcomes all visitors with open arms and invites us to explore its rich heritage. This orientation tour highlights the city’s famous landmarks. Passing through the city, we shall have a photo stop at the City Hall which dominates Donegall Square. Built in grand classical renaissance style, it looks like the American State capital building with the addition of a statue to Queen Victoria. There is also a memorial of the sinking of Titanic—built at the Harland and WolV shipyard in the city. Continuing on to the leafy suburbs of this Victorian City, we stop at Queen’s University and take a stroll through this seat of learning to the Botanic Gardens. Here we will have time to enjoy the splendour of the famous Palm House, which dates from 1839, before rejoining our coach. Our tour then moves on a circular route of the city, taking in many of Belfast’s famous landmarks. These include the political wall murals located on the Protestant Shankill Road and the Catholic Falls Road, which are a unique cultural experience. There will be time here for photographs. We will also see the former Crumlin Road Court House and Crumlin Jail (both of these venues were for political oVenders only) and The Peace Line. A short distance outside the city we shall see Stormont Castle, seat of the Northern Ireland Assembly. A symbol of progress from Northern Ireland’s troubled past, the power sharing executive with responsibility for Northern aVairs rule from this impressive building. Tour Notes: This tour involves a moderate amount of walking—approximately 300 metres at Queen’s University and the Botanic Gardens. It should be noted that Stormont will be viewed from the gates—traYc is not permitted in the avenue leading to the building itself. The order of sights seen may vary.

Tour B Mount Stewart House &Gardens Duration: 3² hours Participants: Limited to 80 We travel from the port of Belfast to Mount Stewart, an impressive 18th century mansion now owned by the National Trust. The property boasts one of the greatest gardens in Britain and Ireland. Home of the influential Londonderry family, the famous gardens span 98 acres and include Sunken, Shamrock and Italian Gardens as well as the amazing Dodo Terrace and the Temple of the Winds—a hilltop banqueting house designed by James “Athenian” Stuart in the 1780s. Situated on the Ards Peninsula, the Mount Stewart Gardens—nominated as a World Heritage Site—were designed by Lady Londonderry for her children, in 1920. Today there is a significant series of outdoor “rooms”, vibrant parterres and lush borders that contain exotic plants, which thrive in the area’s microclimate, together with breathtaking vistas across the central lake. After a guided tour of the house, we can stroll through the gardens and enjoy refreshments in the tearoom (at our own expense) or browse through the gift shop. Processed: 29-10-2009 23:00:04 Page Layout: COENEW [E] PPSysB Job: 435922 Unit: PAG7

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On our way back to Belfast, we travel through the wealthy suburbs of Hollywood, and return to our awaiting ship.

Tour Notes: Please note that the upstairs of Mount Stewart House is not accessible to wheelchairs. There are approximately two hours of walking involved. Refreshments are not included.

Tour C The Giant’s Causeway Duration: 5 hours Participants: Limited to 160 We depart from the port of Belfast and drive inland through the Northern Counties of Down and Antrim, en route passing Ballymoney and Ballymena. We shall then be able to visit the World Heritage Site, the Giant’s Causeway.

This natural phenomenon is one of Ireland’s most extraordinary attractions. The world famous cluster of basalt columns is nestled on the Antrim coast surrounded by dramatic sea cliVs. It is the result of volcanic activity that altered the face of Ireland. A quirk of geology or, if you believe local mythology, a result of a battle between the Irish giant, Finn MacCool, and his rival in Scotland—we will leave you to decide . . .

Following our memorable visit to this top visitor attraction, we will rejoin our coach and guide for the return drive to our awaiting ship. Time permitting, a photo stop will be made at the ruins of Dunluce Castle before turning south for Belfast.

Tour Notes: Please note that this tour is not suitable for wheelchair users. There is a shuttle bus that takes us from the visitor centre to the Giant’s Causeway, but if you choose to walk the path is uneven. Flat, comfortable walking shoes with non-slip soles are highly recommended.

Tour D Panoramic Belfast Duration: 2° hours Belfast is a city of industry and elegance and boasts a rich and varied past. Its origins go back to an ancient fort controlling the ford across the River Lagan, which flows through the city. Our panoramic tour of the city will introduce us to the many features of Northern Ireland’s largest city. Built with 19th century industrial money, many fine buildings from this era grace the city still and are reminders of its prosperous past.

We shall see such sights as the Grand Opera House and the Albert Memorial, before passing Queen’s University and the Botanic Gardens. Located in these gardens is the Palm House—a superb structure of cast iron and curved glass panels built even before Kew Gardens opened in London in 1839.

We will drive past Belfast City Hall x an impressive building with a 300-foot long fac¸ade of Portland stone, which dominates Donegall Square. A stop here will allow photographs of what is perhaps the most noteworthy of the statues in the grounds. It is the marble figure of “Thane” on a granite pedestal, sculpted by Sir Thomas Brock and commemorating the Titanic, the ill fated Belfast built liner.

We will travel a short distance outside the city to see Stormont Castle, seat of the Northern Ireland Assembly. A symbol of progress to Northern Ireland’s troubled past, the power sharing executive with responsibility for northern aVairs rule from this impressive building.

We will also journey to Cave Hill to view Belfast Castle. Cave Hill, with its familiar outline visible from many parts of the city, has captivated generation after generation. Indeed the hill is one of the most celebrated landmarks of the city. Belfast Castle, sited on the lower slopes beneath Cave Hill, is one of Belfast’s most outstanding and historically significant buildings. There are beautiful gardens and an adjoining country park. Do not miss the splendid views of Belfast Lough and the city below. “Mac Art’s Fort”, a rock where United Irishmen planned the rebellion of 1795, overlooks the Castle.

We then return to Belfast Port and our awaiting ship.

Tour Notes: This is a panoramic coach tour and, as such, is suitable for all (passengers must be able to board the coach unaided). It should be noted that Stormont will be viewed from the gates—traYcisnot permitted in the avenue leading to the building itself. The order of sights seen may vary. Processed: 29-10-2009 23:00:04 Page Layout: COENEW [O] PPSysB Job: 435922 Unit: PAG7

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Tour E The Ards Peninsula Duration: 4 hours Participants: Limited to 80 The Ards Peninsula, an area of immense beauty and spectacular scenery, curls around the western shore of Strangford Lough and at 18 miles long is one of the largest sea inlets in the British Isles. The coastal road along the southern shore of Belfast Lough plays hide and seek with the sea, like the railway that runs alongside it. A place of great natural beauty, the peninsula is a bird sanctuary and wildlife reserve, and is home to many species of marine life. We will drive from Belfast to Newtownards, the principal town of this area situated at the northern end of Strangford Lough. From here, we will drive along the coast road to Grey Abbey x named after the Cistercian Abbey founded here in 1193. We will stop to view the substantial remains. Unfortunately Grey Abbeys’ annals did not survive but what little history is known is none-the-less intriguing. From Grey Abbey, we will traverse the peninsula to Ballywalter. Formally a fishing village, Ballywalter is now typical of the tranquil lifestyle enjoyed by the inhabitants of this area. Local fishermen still lay pots or creels for lobsters and crabs during the summer months. Turning north, we follow the coastal route through the town of Millisle to Donaghadee. A stop will be made here, to visit a local hostelry for Irish coVee. Afterwards, time permitting, we will have some free time to explore this pretty little hamlet independently. Donaghadee boasts a long seagoing history, therefore it is not surprising that it still maintains a special relationship with the sea, proving very popular with water enthusiasts, anglers and those who simply like to be beside the seaside. From Donaghadee we have the opportunity to enjoy spectacular views across the Irish Sea when, on a clear day, we can see all the way to Scotland. In the harbour is Donaghadee’s impressive lighthouse, which was built in 1836 and was the first lighthouse in Ireland to be lit by electricity. Rejoining our coach and guide, we will make the return journey to Belfast. Tour Notes: There is limited walking on this tour—approximately 45 minutes at Grey Abbey, over uneven ground, and at passengers’ discretion during the free time in Donaghadee. Some steps will be encountered. One Irish CoVee per person will be included at the refreshment stop.

FAMILY FRIENDLY TOUR Belfast Duck Tour Duration: 1® hours Participants: Maximum of 40 We will experience “Big Yellow”—the world’s most advanced amphibious vehicle for a fun yet informative ride, which promises to have us amazed and appeals to all ages. Our one-hour land and sea adventure includes downtown Belfast, its shopping districts, the many monuments and the historically significant buildings that dot the Belfast skyline. A slow drive through the Titanic quarter with a brief stop by the Harland and WolV dry dock where the Titanic was fitted and of course the story of Belfast shipbuilding. An exciting splash down into the River Lagan is followed by a slow cruise up and back down the river. Children will be oVered the opportunity to “skipper” the vessel on the return portion of the voyage. We return to the port after a delightfully funny and interactive narration provided by one of Belfast’s best tour guides. Tour Notes: These brand new vehicles are wheelchair accessible and suitable for all ages, and will be accessed from the port. They accommodate up to 50 passengers in aircraft style seats—the tour may not be exclusive to Fred. Olsen passengers. This tour includes approximately 20 minutes on the River Lagan, and approximately 40 minutes on roads. Depending on numbers for this tour, we may be allocated another vehicle rather than “Big Yellow” but our experience will be equally enjoyable.

Written evidence from the Freight Transport Association (FTA) Introduction 1. Freight Transport Association (FTA) represents over 14,000 companies engaged in the transport of freight both domestically within the UK and internationally. Their interests range from those as operators, carriers, freight service providers, through to customers—suppliers of raw materials, retailers, manufacturers, and wholesalers, covering all modes of transport—road, rail, water and air. Processed: 29-10-2009 23:00:04 Page Layout: COENEW [E] PPSysB Job: 435922 Unit: PAG7

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Background—UK Ports 2. Unlike the rest of Europe the UK has a market lead ports sector. Owners include private operators, local authorities and trust ports. The UK ports operate without Government funding, unlike competitors on the continent. There are diVerent kinds of services used by the freight operators: — Ferry services—which concern trucks and drivers as well as other passengers. — Dedicated freight Roll-on Roll-oV services—Which typically send trucks and trailers unaccompanied. — Container services—where the freight is loaded and shipped in standardised containers, this service dominated the deep sea service from the Far East. — Bulk—For the shipment of products such as grains, oil and aggregates. UK ports compete with each other for all these services as well as competitors from the continent. 3. The current freight and logistics industry has changed significantly over the past 10 years. This change has been driven by several factors, including: — globalisation; — internet and web enabled supply chain management tools; — bar coding, stock control and inventory management systems; — information communication technology applications; — consolidation; — retailer-led supply chain dominance in European market (ie From “push” to “pull” supply chain economics); and — service industry importance in economy. 4. Given the scale of the change, the assumption can be that the rate of change in the freight and logistics industry in the next 10 years will at least equal, if not exceed, that of the last decade, albeit some of the major ports have shown a reduction in their 2008 throughput as a result of the recent down turn in the economy. 5. Total freight traYc through UK ports in 2008 was 563 million tonnes (Mt), a fall of 3.3% on 2007. Inwards traYc fell by 3.1% to 347 Mt, whilst outwards traYc fell by 3.5% to 216 Mt. As shown in figure 1:

TRENDS IN TRAFFIC THROUGH THE TOP 10 PORTS IN 2008 IN TERMS OF TONNAGE ARE SET OUT BELOW

Million tonnes % change between 2007 and 2008 1998 2007 2008 Grimsby and Immingham 48.4 66.3 65.3 "1.5 London 57.7 52.7 53.0 !0.5 Tees and Hartlepool 51.5 49.8 45.4 "8.8 Southampton 34.3 43.8 41.0 "6.4 Forth 44.4 36.7 39.1 !6.5 Milford Haven 28.8 35.5 35.9 !1.1 Liverpool 30.4 32.3 32.2 u/c Felixstowe 30 25.7 25.0 "2.7 Dover 17.7 25.1 24.3 "3.2 Medway 15.5 15.4 15.0 "2.6

6. Since the economic picture can and does change over time, sometimes suddenly, it is important to keep the freight flow forecasts under regular review to ensure the investment priorities funded by the public remain informed and appropriate to the needs of the economy.

Ports and Wales 7. Ports policy in Wales, unlike Scotland and Northern Ireland, is administered by Westminster although decisions regarding land side access to and from the ports are a matter for the Welsh Assembly. Therefore FTA recognises the importance of robust polices within Wales that look at improving and making best use of existing infrastructure which are consistent with the aims of Eddington. 8. Welsh ports are diverse by nature dealing with a variety of goods and passenger activity. Ports reflect economic activity, especially the industrial activity of their hinterland. The busiest decades in terms of traYc in the ports of CardiV and Swansea mirror the industrial activity associated with mines and steelworks. Holyhead has been much more dependent on trade between the UK and Ireland, and Milford Haven has developed a role for petrochemicals traYc. Port activity in Wales includes: — Holyhead, Milford Haven and Fishguard—HGV activity with Roll on/Roll oV (Ro-Ro) and passenger traYc; Processed: 29-10-2009 23:00:04 Page Layout: COENEW [O] PPSysB Job: 435922 Unit: PAG7

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— Milford Haven the largest port in Wales—oil and energy sector traYc; — Newport, CardiV, Barry, Port Talbot and Swansea (owned and operated by Associated British Ports) primarily handling dry and liquid bulk, forest products, iron and steel products and some lift-on lift-oV (Lo–Lo) container traYc; and — smaller ports engaged in the leisure industry. 9. Welsh freight ports have a significant impact on the Welsh economy representing around 10% of total UK trade. The ports provide direct employment opportunities, and benefit related businesses, including local sub-contractors and suppliers. They comprise 6.6% of EU loading and unloading, 16% of “all other short sea” and 11% of “all deep sea” traYc. 10. Welsh port unitised traYc transported by road goods vehicles makes up 1% of all UK empty units, 10% of loaded units and 8% of the weight of goods through UK ports. Welsh container traYc accounts for 0.5% of all UK units and 0.4% of the weight of all UK goods traYc. Liquid Bulk throughput represents 15% of all the liquid bulk traYc in the UK. 11. The port of Holyhead provides an important link in the European road infrastructure between Ireland and the mainland and in consequence it draws traYc from a large hinterland. 12. Ports themselves clearly oVer employment to regeneration opportunities. It is crucial to remember however that the most important economic aspect of them is what they facilitate—most importantly the eVective international trading of goods. The ability to export eYciently is a key component of a region being seen as an attractive place in which to base economic operations. Equally the ability to import to a region helps maintain and develop the standard of living available to the population. Consequently the importance for other UK ports to the Welsh economy should not be neglected. To a large extent, Wales’ major container ports are, and will continue to be, Southampton, Felixstowe and the London ports. Connections from these ports to Wales, via both sea and land should be a key aspect of Welsh policy.

Policy Framework for the Development of the Welsh Ports 13. Ports on the whole are privately owned and as a result their development is a commercial decision based on location and the needs of the market. Current practice incorporates a lengthy planning approval system that discourages developments, with a new requirement on the promoters of particular port development proposals to pay for inland infrastructure developments. 14. As many of the ports are owned by foreign companies this could have a discouraging aVect on future investment decisions as it places UK ports at a competitive disadvantage to Continental ports, which typically do not have to bear these infrastructure costs. See table below.

Existing port 2004 capacity (TEUs) New port capacity: private funding New port capacity: public funding New project Felixstowe 2.7m 100% of all port development costs 0 Felixstowe South and Bathside Bay Share of road/rail costs Southampton 1.4m 100% of all port development costs 0 3.7 million TEU capacity Share of road/rail costs Rotterdam 8.3m ƒ1.6 billion ƒ1.1 billion for port development Maasvlakte II 100% for rail link Hamburg 7.0m Superstructures only ƒ788 million for port development 100% funding of road/rail links Antwerp 6.1m ƒ930 million ƒ680 million for port development Deurganckdok 100% funding of road/rail links Bremerhaven 3.5m Superstructures only ƒ59 million for port development 100% road/rail links Le Havre 2.2m ƒ275 million ƒ693 million for port development Port 2000 ƒ101 million for road/rail links

Sources: Ocean Shipping Consultants, ESPO, ISL, as quoted by Dft 15. Government cannot ignore the greater economic benefits from private port developments. Whilst it is not for Government to decide where it wants the freight to flow and where it wants the private developments needed to support the transport of freight and goods, it is the proper role of Government to facilitate the developments. 16. The DfT’s guidance on Funding transport infrastructure for strategically significant developments (published April 2009) has set out a framework for determining the extent of public contributions to necessary infrastructure upgrades (ie road and rail links). But the key question that will determine the success or otherwise of this policy will be the extent to which the Government provide funds for such improvements. 17. The Planning Act 2008 will see the introduction of the Infrastructure Planning Commission, which will make impartial decisions on proposed major developments including ports, in line with UK and Welsh policy. Guidance issued under the provision of the Act about the desired developments of infrastructure will be a welcome simplification to the planning system. Processed: 29-10-2009 23:00:04 Page Layout: COENEW [E] PPSysB Job: 435922 Unit: PAG7

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18. It is important for the future development of Welsh ports that the close working relationship developed with the Welsh Assembly Government through forums such as the Wales Freight group and in the future, the Ports Group are maintained. Policy makers must be able to enter into dialogue with operators to ensure that future decisions regarding ports and importantly, access, are based on the needs of industry. Such an approach would establish a strategic freight policy that is based on the needs of the freight and industry, identified by industry,rather than the aspirations of politicians, civil servants and others that might seek to prejudice decisions on investments in strategic infrastructure. 19. Ports already comply with a number of regulatory requirements which cover dredging operations, security and disposal of waste matter. The introduction in the future of two new pieces of legislation namely the EU Water Framework Directive and the Marine and Coastal Access Bill, will add to the compliance burden on operators. 20. The Wales Freight Strategy15 contains 10 clear recommendations aimed at future guidance for policy makers, these recognise the importance of ports to the Welsh economy. However it is important that the Welsh Assembly Government working closely with DfT make a clear commitment to ensuring funding to carry forward these recommendation which include road and rail routes and intermodal sites. 21. Road remains the dominate method of carrying freight, many factors will need to be considered if this trend is to be reversed and more goods encouraged to use rail or shipping, therefore access to and from ports, and the infrastructure to accommodate additional freight/passenger movements, is an important priority of any future policy. 22. Location of ports will have a direct bearing on the potential for growth; the southern ports in England traditionally serve as the main routes for container traYc links to Europe and the global shipping networks. The potential of Welsh ports is therefore limited however opportunities to encourage feeder shipping services have been discussed at the Wales Freight Group.

Potential to Increase Scale and Range of Trade with Other Countries 23. Ports by their nature supply a service to their customers and are therefore susceptible like all businesses to external factors such as the down turn in the economy. This world recession has seen a marked reduction in manufacturing and consequently goods coming through our ports. Welsh ports have been subject to change before and have consequently adapted. Irish traYc now enters along the north and southern corridors via Fishguard and Holyhead with Milford Haven as a major port with oil/energy imports. 24. Plans to develop the container terminals at Portbury which will accommodate some of the largest sea going vessels (subject to a decision of the development of the Severn Barrage), and a similar scheme on the Mersey will eVectively reduce the viability of a similar container terminal development in Wales. These two terminals will essentially service North and South Wales, North West England and the Southwest, reducing the lorry miles of some other ports. 25. It is important for Government to communicate with the industry through regular reviews as port traYc is a good barometer of the economic state of a nation.

The Potential to Increase Freight Movements 26. The development of oVshore energy is a potential area for increased freight movements in Wales. The construction of wind farms in Mid Wales will see ports in North Wales handling the import of component parts. Plans to establish wind turbines in the Severn estuary could mean expansion for a port in south Wales not only at the construction stage but also for ongoing maintenance/servicing.

Adequacy of Security and Policing in Welsh Ports 27. All ports in Wales will comply with Port Security Regulations however are also adaptable to change dependant on the security status at any given time. May 2009

Written evidence from Professor Frank Gregory 1. This evidence is submitted in response to the “policing and security” aspects of the Committee’s “Ports in Wales” inquiry. The evidence covers: an overview of the relevant legislative and national policy strategies (paras 2–3); an analysis of the threat spectrum (paras 4–10); and an overview of the national and local arrangements for the delivery of security and policing in maritime areas and ports (paras 11–15).

15 One Wales—Connecting the Nation, The Wales Freight Strategy, May 2008 Processed: 29-10-2009 23:00:05 Page Layout: COENEW [O] PPSysB Job: 435922 Unit: PAG7

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2. As the Committee will be aware, the determination of both the national security policy and the ports policies are not devolved government matters but remain the responsibility of central government. Since 2000, in response to both natural and human agency caused disasters or major incidents, the UK has been developing a range of specific policy strategies, instruments and legislative provisions which provide a significant part of the relevant framework for the policing and security aspect of this inquiry. These are: the Civil Contingencies Act 2004, the Aviation and Maritime Security Act 1990, the various Terrorism Acts, the National Security Strategy (2007), the National Risk Register (2008) and the “Contest” Counter-Terrorism strategy (Cm. 6888, 2006, latest version Cm. 7547, 2009). The other part of the framework can be found in the more ports specific and maritime transport related risk management systems established with reference to the International Maritime Organisation’s (IMO) International Ship and Port Facility Security Code (ISPS) which formed the basis for EC Regulation 725/2004 and the 2004 International Labour Organisation code of practice on enhancing port security which forms the basis of EC Directive 65/2005. EC Directive 65/2005 is currently being transposed into UK law.16 The UK has not met the EU’s timetable for the transposition of this Directive into national law but this does not reflect any disagreement on issues of principle but rather the eVects of the process of consultation and reflection on the optimum format for the requisite Port Security Authorities. The Department for Transport hopes to be able to transpose the Directive by c July 2009.17 The Committee may wish to ask the Ministry for indications of the likely nature of the Port Security Authorities which are being planned for the Welsh ports. 3. Thus the arrangements for the security of UK maritime areas and ports security are currently being developed in accordance with international, EU and national requirements. For the purposes of this evidence the EU’s security objectives will be taken as providing a description of the broad maritime related threat spectrum facing the UK. The EU’s objectives, in both the Regulation and Directive mentioned above, are to continuously improve “. . . prevention, protection and response measures to counteract the new threats arising from terrorism, piracy or any other illegal act”.18 These objectives are similar to those in the UK’s first “National Security Strategy” (NSS) which regards “strong borders” (not defined) as “essential to protect against terrorism, crime and illegal immigration” and the NSS has the aspiration to create a “modern, intelligence-led border control and security framework”.19 In the maritime security area, part of the intelligence-led provision on both ship and people movements is provided by the National Ports Analysis Centre. Information from that source and from the Coastguard is also shared with the Naval intelligence staV at Northwood.20 4. In relation to these types of threat the UK uses a three level security alert system for sea areas, foreign ports and UK ports. These are level one (normal), level two (heightened) and level three (exceptional) and these correspond to the EU port security risk levels of: normal, increasing and high. The UK security levels and maritime terrorism threat assessments (established by the Joint Terrorism Analysis Centre (JTAC)) are not published but are made available to shipping and ports operators by the Department for Transport’s Transport Security and Contingencies Directorate (TRANSEC). 5. With respect to the UK Exclusive Economic Zone (EEZ), territorial waters and ports areas the following is an open sources based maritime and ports related assessment but it reflects JTAC’s overall assessment of the terrorism threat to the UK as “Severe”. With regard to maritime terrorism,21 defined here as terrorist actions in port areas, on ships at sea, ship hijacks (as bargaining counters or for the ship to be used as a weapon) or ship-borne Improvised Explosive Devices (IEDs), this category of terrorist acts is relatively small compared with the dominant forms of land based terrorist incidents. However, that does not imply that facilities such as ports are not part of the Critical National Infrastructure, which they clearly are, or that a terrorist attack on a port area would have a lesser consequence than an attack on a city centre. Clearly that cannot be the case where many port areas are adjacent to large urban concentrations. For the UK itself, based upon the general level of terrorist threat to the country and the global pattern of maritime terrorism it can be postulated that there is a low to mid-spectrum level of probability of a maritime terrorism threat to the UK but that if an attack occurred it might have a high impact. 6. The types of suspect maritime terrorism threats that might face the UK via its maritime areas, of which the “Bristol Channel” and “Irish Sea” areas are of relevance for the Welsh ports, are, to date, statistically of very low frequency. Since 2001 the only recorded fully investigated suspected terrorist ship-borne threat was the Port of London bound bulk sugar carrier MV “Nisha” incident of December 2001. The “Nisha” case22 was an intelligence led operation but one which was without specifics in terms of the vessel or nature of the threat. The “Nisha” simply best fitted the profile of the likely threat from the available intelligence as en route the “Nisha” had stopped at Djibouti near suspected Al-Qaeda “aYliates” “bases” in Somalia.

16 See further: Department for Transport, A brief overview of the United Kingdom National Maritime Security Programme and EC Commission Report from the Commission to the Council and the European Parliament—Report assessing the implementation of the Directive enhancing port security, COM(2009) 2 final, 20/1/09. 17 Information from TRANSEC, 25/5/09 18 COM(2009) 2 final, op cit, p 6, para 7 19 National Security Strategy Cabinet OYce 2008: 56–57 20 Defence Committee, Sixth Report of Session 2008–09, The Defence contribution to national security and resilience, HC 121, Q287–Q291 21 A useful source is CRS Report for Congress, Maritime Security: Potential Terrorist Attacks and Protection Priorities,PW Parfomak & J Frittelli, RL33787, US Congressional Research Service, 14 May 2007. 22 See F Gregory, “Intelligence-led Counter-terrorism: A Brief Analysis of the UK Domestic Intelligence System’s Response to 9/11 and the Implications of the London Bombings of 7 July 2005”, ARI No. 94/2005, Real Elcano Institute, Madrid, 2005. Processed: 29-10-2009 23:00:05 Page Layout: COENEW [E] PPSysB Job: 435922 Unit: PAG7

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Apart from the “Nisha” there have only been a very small number of “ship alerts” relative to the total number of ship movements through UK waters. For example, in 2008 there were only two recorded “ship alerts” and in both cases no counter-terrorism response was required.23 Although there are issues around the variable timescales encountered in verifying ship identifying transponder details. Transponders must be carried on all commercial vessels over 500 tonnes. 7. The final terrorism related issue that is of relevance to this inquiry is the matter of the extent to which there is any evidence of particular patterns in the use of Welsh ports as entry points into mainland UK by persons whose names may appear on “terrorist watch-lists”. Evidence to the Committee (para 18) has drawn attention to the possible implications of proposals that were in the current Borders, Citizenship and Immigration Bill,24 to disband the Common Travel Area between the UK and the Irish Republic and introduce immigration controls. The Committee may wish to seek further evidence on this point and ask whether there are implications for the resource levels currently deployed to Special Branch ports policing in Wales and, in particular, the adequacy of the Dedicated Security Post funding allocations. 8. Piracy, defined as “any illegal acts of violence or detention, or any act of depredation, committed for private ends by the crew or the passengers of a private ship . . . and directed . . . on the high seas, against another ship, . . . persons or property in a place outside the jurisdiction of any State . . .”25 occurred in the sea areas outside UK territorial waters in the 18th and early 19th centuries. However, the consensus of current expert opinion is that piracy is a most unlikely occurrence in the waters around the UK today. This, of course does not mean that ship operators based in Welsh ports do not need to take account of the threat of piracy in overseas areas. Guidance to ship operators on this matter is available via TRANSEC in the form of “Maritime Guidance Note 298”. 9. The EU’s category of “. . . other illegal acts . . .” covers a wide spectrum of security related issues that may occur in port areas. For example, the ordinary crimes of theft, malicious damage and arson and the public order oVences that might occur during protest activity related to, for example, environmental or animal trade issues. In the latter instances the UK has experienced protest activity in port areas or adjacent waters in respect of seaborne nuclear weapons, toxic materials and the trade in live animals. The South Wales Police area experienced just such a problem with respect to seaborne Greenpeace protests in 1999 (radioactive materials transport by sea) and 2004 (GM products). In the latter case, in June 2004, the Panamanian registered MV Etoile which was carrying GM maize gluten from the USA to Bristol docks was boarded in the Bristol Channel, whilst underway, by Greenpeace activists based on four Rigid Inflatable Boats (RIBs) who unfurled protest banners. The activists were subsequently charged with public nuisance oVences and oVences under section 106 of the Merchant Shipping Act 1995.26 As a result of the 2004 incident the three southern Wales police forces carried out a major contingency planning exercise, Operation Oyster Catcher, to determine the optimum response format and its resource implications. The Committee may wish to seek further information on this point from the South Wales Police. This “other illegal acts” category can also cover the specific border controls related crimes that are raised as matters of concern in the NSS: drug traYcking, alcohol and tobacco smuggling and the various forms of illegal immigration, particularly people smuggling and human traYcking. In the context of these crimes, related to attempts to evade border controls, the Committee may wish to seek evidence from the UKBA about the relative position of the Welsh ports, in comparison with English ports, with respect to detection of attempts at illegal entry, port seizures of illicit drugs and revenue protection work at Welsh ports.27 10. With regard to the threat types discussed in the above paragraphs the Committee has received evidence from the British Ports Association and the UK Major Ports Group which contends (para 19) that all the Welsh ports are moving to full compliance with current and pending regulatory frameworks. Their evidence further expresses the belief that “. . . security and policing at Welsh ports are strong”. The Committee may wish to ask for further evidence to substantiate this claim. 11. The delivery of UK maritime areas and ports security, in conjunction with the relevant private sector bodies, is the responsibility of several government “lead departments” and their associated public sector agencies.28 Unlike the USA, the UK security governance structure does not contain a “super-ministry” like the US Department of Homeland Security. In the UK the oversight and coordination of the security responsibilities of “lead departments” is assigned to the National Security Secretariat of the Cabinet OYce. General security responsibilities reside with the Home OYce through its OYce of Security and Counter- Terrorism (OSCT), the Home OYce responsibility for police forces in England and Wales, the UK Border Agency (especially the c 9,000 strong UK Border Force of immigration and customs oYcers) and the Home OYce oversight of MI5 via the Home Secretary’s approval of MI5’s annual prioritisation of its objectives. Transportation security is the responsibility of the Department for Transport through its Transport Security

23 Defence Committee, Sixth Report of Session 2008–09, The Defence contribution to national security and resilience, HC 121, Q306 24 See Explanatory Notes to the Borders, Citizenship and Immigration Bill [Lords] [Bill 15 (2008–09)–EN] 25 Article 101(a) UN Convention on the Law of the Sea (1982) as cited in: K Kittichaisaree, International Criminal Law, Oxford, OUP, 2002, pp 14–15 26 IMO, “External Relations (c) Relations with non-governmental organisations, Council 93rd Session, Agenda item 17 (c), C 93/ 17 (c)/Add 3, 26 October 2004 27 See further: F Gregory, UK Border Security: Issues, systems and recent reforms, London, IPPR, March 2009 28 On “lead department” issues see: F Gregory, Ch 6, in P Wilkinson, (ed), Homeland Security in the UK, London, Routledge, 2007 Processed: 29-10-2009 23:00:05 Page Layout: COENEW [O] PPSysB Job: 435922 Unit: PAG7

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and Contingencies Directorate (TRANSEC) and the Maritime and Coastguard Agency (MCA). All the public sector stakeholders are represented on TRANSEC’s National Maritime Security Committee. Additional protective security advice is available through the Centre for the Protection of the National Infrastructure (CPNI) working with specialist police oYcers in the National Counter-Terrorism Security OYce (NaCTSO) and the associated local police force Counter-Terrorism Security Advisers (CTSAs). 12. In the UK and within UK territorial waters the initial response to all forms of crime including terrorism (except in border entry points where legislation on immigration related matters or importation of goods controls provides for primary responsibility to be with UKBA staV) is a local police force responsibility, supported where they exist in port areas either by the MoD Police or a non-Home OYce port police force. In particular all police forces with ports within their areas of responsibility maintain Special Branch ports policing units but these are variable in size. The police forces participate in regular annual cycles of various levels of counter-terrorism exercises which can include in their scenarios an incident with a port related component. However, the national standards for counter-terrorism policing were described, in 2006, by the Chief Constable of North Wales as “. . . particularly demanding...”andhesuggested that the “. . . view of the Force is that as drafted the standard will be forever unattainable . . .”.29 The Committee may wish to seek current evidence on this point from the Welsh police forces. 13. However, with regard to terrorism the police response is partly delivered through ACPO national bodies and the national role of the Metropolitan Police Counter-Terrorism Command (SO15).30 The ACPO Terrorism and Allied Matters Committee (ACPO-TAM) is at the apex of this structure. Under ACPO-TAM there is a National Coordinator for Terrorist Investigations (NCTI) who is currently a Metropolitan Police DAC. The NCTI will take the “Gold lead” in relation to actual or suspected terrorist incidents oV the UK coast. If an incident came into English or Welsh waters and thus into a local police force area then the local Chief Constable will take control of the immediate incident location. 14. In the maritime/ports areas ACPO has a specific response structure under the ACPO Maritime Committee, currently chaired by Chief Constable Hogan Howe of Merseyside Police. Working to that Committee and to ACPO-TAM is an ACC ranked oYcer holding the post of National Co-ordinator Ports Policing (NCPP) he also holds, under ACPO-TAM, the post of police National Coordinator PROTECT under the “Contest” counter-terrorism strategy. For maritime security purposes the police have divided the UK into nine “portal control” areas representing nine coastal areas around the UK. The two relevant to Wales are the “Bristol Channel” and “Irish Sea”. Each portal area has a regional ACC who coordinates the relevant portal area police commanders. The Committee may wish to ask ACPO Maritime for the relevant outcomes of the February 2009 police peer review assessment of the work of port area police commanders.31 15. In conclusion, the Committee will be aware that the Defence Select Committee of the House reported on maritime security issues on 5 May 2009 in their Report on “The Defence contribution to UK national security and resilience”.32 In this Report the Defence Committee expressed concerns about “. . . strategic oversight and ministerial accountability . . .” with regard to maritime security.33 The Committee may wish to ask ACPO Cymru for their views on this matter and whether they agree with Chief Constable Hogan- Howe’s comment, on the arrangements for responding to maritime security incidents, that “. . . we seem to be potentially disorganised, but it works well.”34 May 2009

Written evidence from Irish Ferries (UK) Limited 1. Irish Ferries—Routes,Ships and Services Irish Ferries is a ferry company, carrying passengers, cars and freight vehicles, between Ireland, Great Britain and France. Irish Ferries is a wholly owned subsidiary of the Irish Continental Group, which is registered on the Irish Stock Exchange. Our current ships and routes are: — Holyhead to Dublin. MV “Ulysses”, which is 210 metres long and has a gross registered tonnage of 51,000 tonnes. This ship has the capacity to carry 1,900 passengers, 1,342 cars or 240 freight vehicles, per sailing; — Holyhead to Dublin. MV “Jonathan Swift”, which is a High Speed Craft, 87 metres long, with a gross registered tonnage of 5,989 tonnes. This ship has the capacity to carry 745 passengers, 200 cars and up to 10 coaches, per sailing at speeds up to 40 knots; and

29 North Wales Police, Report by the Chief Constable to the Police Authority on Narrowing the Gap: The Provision of Protective Services in North Wales, 28 July 2006, p 24 30 Defence Committee, Sixth Report of Session 2008–09, The Defence contribution to national security and resilience, HC 121, Ev 47 31 ibid, Q261 32 ibid 33 ibid, para 42 34 ibid, Q241 Processed: 29-10-2009 23:00:05 Page Layout: COENEW [E] PPSysB Job: 435922 Unit: PAG7

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— Pembroke to Rosslare. MV “Isle of Inishmore”, which is 183 metres long with a gross registered tonnage of 34,000 tonnes. The ship has capacity for 1,260 passengers, 710 cars or 122 freight vehicles per sailing. In 2008 we carried 1.3 million passengers, 319,000 cars and 260,000 freight vehicles on 3,930 sailings between Ireland and Wales. We also operate a ferry service from Rosslare to Cherbourg and RoscoV.

2. Irish Ferries Investment in Ships and Ports Since the mid 1990s Irish Ferries has invested over ƒ400 million in new ships and port facilities. In Holyhead the port investment was a joint project with Stena Line Ports, the owners of the Port of Holyhead. Irish Ferries share of the development costs was over £20 million. In Pembroke Dock, the investment was a joint project with the Milford Haven Port Authority, at a cost of over £11 million. Both of these port developments were primarily privately funded, with very little grant aid being made available.

3. Traffic Flows and Routes—Island of Ireland The following table outlines the typical annual volumes of passengers and vehicles moving between the island of Ireland and the UK mainland, by sea. These are the 2008 totals.

Corridor Passengers Cars Freight Vehicles Northern 2,076,000 533,000 804,000 Central 2,167,000 488,000 722,000 Southern 900,000 250,000 134,000 RoI Irish Sea Totals 3,067,000 738,000 856,000 Island of Ireland Totals 5,143,000 1,271,000 1,660,000

The Northern Corridor figures are the totals handled through the ports of Belfast, Larne and Warrenpoint, from the ports in Scotland and Northern England. The Central Corridor figures are the totals handled through the Ports of Dublin and Dun Laoghaire, from Northern England and Holyhead. The Southern Corridor figures are the totals handled through the Port of Rosslare, from Pembroke and Fishguard. Passengers and freight traYc are down about 7% versus 2008, but the loss of business accelerated sharply in the final quarter of 2008. The first quarter of 2009 also reflects the current economic position. From the totals shown above, the percentages carried to and from Northern Ireland and the Irish Republic are:

Area Passengers Cars Freight Northern Ireland 40% 42% 48% Irish Republic 60% 58% 52%

Prior to January 1993, the freight market was considerably diVerent, with an even greater proportion of the business carried on the Northern Corridor. 564,000 (72%) of freight shipped on the Northern Corridor with the balance of 28% (215,000) on the Central and Southern Corridors. It is important to bear in mind that decisions made by Governments can have a disproportionate impact on trade. To illustrate this, and to highlight one of our concerns, we would like to refer back to significant changes in the 1990s and their impact on business.

The EU Single Market 1 January 1993 Prior to the introduction of the EU Single Market on the 1 January 1993, the Northern Ireland Ports carried 72% of the freight traYc for the Island of Ireland. The two primary reasons for this were: — the significantly better customs clearance times at the Irish Land Boundary; and — the lack of freight capacity on the direct routes to Southern Ireland. Movement of freight vehicles across the land boundary was a matter of expediency, in view of the political issues at that time, whereas vehicles travelling on routes to/from UK ports direct from Ireland would be subject to greater delays and the rigours of more in depth customs controls, on documentation and physical examinations. Processed: 29-10-2009 23:00:05 Page Layout: COENEW [O] PPSysB Job: 435922 Unit: PAG7

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The removal of these controls in January 1993 and the increase in capacity on Central and Southern Corridor routes from the mid 1990s has helped to level this “playing field”. This encouraged investment by the ferry operators on the Central and Southern Corridors, causing a shift of traYc from the Northern Corridor to these routes.

4. Key Issues for Irish Ferries Services in Wales A. Valuation OYce Agency Proposals The VOA issue at all of the UK Ports has been well documented and debated. Therefore I propose to limit this section of the report to the impact on Irish Ferries of the VOA review. In both the port of Holyhead and Pembroke Dock, Irish Ferries do not specifically occupy, or have exclusive rights to any parts of the ports. We do have time slots agreed with the owners of the properties.

Holyhead The owners of the Port of Holyhead are Stena Line Ports and we have a commercial agreement with them to operate our ferries, from certain berths at certain times of the day. They also operate a similar arrangement with Stena Line, the ferry operator. Both Ferry Operators, Irish Ferries and Stena Line, have their own facilities, but from time to time, are required to use one another’s berths, eg in the case of weather disruption or berth repairs. It is the decision of VOA that Irish Ferries operation in Holyhead does not warrant being separately assessed for rates.

Pembroke Dock The owner of the Pembroke Dock Ferryport is the Milford Haven Port Authority and we have a commercial agreement with them to operate our ferry, at certain times of the day. Currently, Irish Ferries is the only ferry operator using the Pembroke Dock Ferry Terminal. However there have been other users since 2005 and the Port Authority is in the process of developing a ferry service direct to Ferrol in Spain. It is the decision of the VOA that Irish Ferries operation in Pembroke Dock should be separately assessed for rates, backdated to 2005, with a rateable value of £660,000. This gives Irish Ferries the following liabilities: — 2005–06 £277,860 — 2006–07 £285,120 — 2007–08 £295,680 — 2008–09 £307,560 In addition there will be a similar liability for 2009–10, not included in these figures. Central Government has indicated that companies may be given eight years to pay the backdated element of these charges, however we would still have to pay over £600,000 this year for 2008–09 and 2009–10. As part of our arguments against the separate rates assessment for Pembroke Dock, we have quoted the example of Terminal 5 at Heathrow, where British Airways is the only airline using that facility, yet the rates are paid by the airport authority. Irish Ferries has not accepted the validity of these charges and continues to contest them. If implemented, these charges will have a crippling eVect on Irish Ferries Pembroke Dock operation.

B. Common Travel Area and E Borders Proposals B1. UK Border Agency Controls—Proposals for the Irish Land Boundary The UK Border Agency has stated that it will not introduce fixed immigration controls on the Irish Land Boundary, but will consider introducing ad hoc immigration checks on vehicles on the Northern Ireland side of the land border. We can draw a direct parallel between what is proposed for passenger immigration controls, with what previously happened with the freight market prior to January 1993. In summary: — although it has now said that checks will be “risk based and intelligence led”, the UK Border Agency consultation documents indicate that it expects delays to occur at ports, therefore travel via the Irish Land Boundary will become more attractive, with the potential to cause significant displacement of traYc to the Northern Corridor; — passengers wishing to avoid immigration checks, for whatever purpose, will be encouraged to use the Northern Corridor, creating a “back door” controlled by “ad hoc vehicle checks”; and — freight drivers wishing to avoid delays at UK Ports, may avoid direct services, in favour of Northern Ireland routes. Processed: 29-10-2009 23:00:05 Page Layout: COENEW [E] PPSysB Job: 435922 Unit: PAG7

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B2. UK Border Agency Controls—CTA and E Border Proposals for UK Ports—Commercial and Financial Impact As stated earlier, in addition to the investment in new ships since the mid 1990s, Irish Ferries has made significant investments, in association with the Port Authorities, in the port infrastructure in Holyhead and Pembroke Dock. The ports were re-designed to take account of the larger ships and the subsequent increase in freight business and to allow for growth in passenger traYc at that time. All of these changes in ports infrastructures were made in light of the Single Market Changes, which gives us, at the Ports, the ability to respond flexibly to changes in the freight or passenger markets, in terms of land use within the termini. The above mentioned investments also give us the ability to make fast turnarounds of ships in ports, to maintain schedules and meet customer’s expectations. The scenario envisaged by the UK Border Agency, which intends to implement checks on documentation for every passenger, either Passports or National ID cards, is likely to have the following detrimental eVects on our services and customers: — cause significant delays in the processing of passenger traYc and driver accompanied freight traYc, encouraging both traYcs to use the Land Boundary Routes; — impact on land use within termini, to the extent that the discharge or loading of ships will have to be delayed due to “traYc jams” from ships to the Border Agency Control points caused by stopping all traYc. Ship/Terminal operations will have to be suspended until traYc clears the checkpoints; and — there is a very real risk that it will have a detrimental impact on vessel turnaround times, to the extent where we cannot maintain our existing schedules, in turn reducing the number of sailings that we are able to achieve. In addition, there are direct financial costs associated with the Common Travel Area (CTA) and E Borders proposals. These include the imposition of £2,000 Carrier Liability Fines and the cost of the scanning equipment required to implement the E Borders Controls. The “Carrier Liability” Fines of £2,000 per passenger could be imposed ie in a case where a passenger could not prove his/her identity on arrival in the UK. When you consider that the majority of Irish Sea passengers are UK or Irish residents, this is clearly disproportionate. An analysis of Irish Ferries passenger carryings for 2008 produces the following statistics: — 61% were resident on the British Mainland; — 32% were resident in the Irish Republic; — 2% were resident in Northern Ireland and — of the balance of 5%, 1.1% was German and 0.3% was French, leaving a balance of 3.6% of other nationalities. Irish Ferries is concerned over the potential impacts of the CTA and E Borders proposals. The nature of today’s multi-purpose passenger and freight vessels requires fast and eYcient turnarounds in port, which are critical for the successful deployment of large vessels. Such developed improvements have provided better productivity and economies of scale, and lower freight and passenger fares, all of which are critical to the economy of both Islands.

C. IMO Resolution for Sulphur Content Reduction 2015 As part of MARPOL Annex VI, in April 2008, IMO agreed that the sulphur limit in marine fuel must be reduced to 0.1% by 2015 in Environmentally Controlled Areas. The impact will be a 68% increase in fuel costs. There may also be an issue over the availability of what is essentially gas oil. The proposal is due to apply in the Baltic, North Sea and English Channel, to any type of vessel with more than 12 passengers. Should similar be extended to the Irish Sea, it would have serious and dramatic consequences for access via sea costs between both islands for all ferry operators.

D. Road and Rail Infrastructure in Wales D1. Holyhead Road Access The dualling of the A5 across Anglesey has provided major benefits to the Port of Holyhead and has significantly improved access. When this was in the process of completion, to connect the port to the A5, an issue arose over the ownership of the land immediately at the exit from the Port. The land was owned by part of the former British Rail Group and this was not resolved. Now, to exit the port, you must turn right at a set of lights and within 100 metres turn left at another set of lights, to join up with the A5. At busy times, when ships are discharging, this causes a bottleneck eVect, backing up into the port. The port owners are reviewing traYc flow options from other parts of the port, in an eVort to resolve this. However until the position on CTA and E Borders is clarified, it does not make sense to implement any changes. Processed: 29-10-2009 23:00:05 Page Layout: COENEW [O] PPSysB Job: 435922 Unit: PAG7

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D2. Holyhead Rail Access Foot-Passengers (non vehicle passengers) enjoy the easy access to the railway station at the port entrance. However, with the abolition of Duty Free for intra EU travel in 1999, and the continued growth in cheap air fares, the foot passenger market is in serious decline and is not a significant element of traYc. For freight traYc, there are no links or facilities for rail transfers. In the 1970s containerised rail-freight to Lift on/Lift OV Vessels, was a major feature of UK Road Haulage. However with the growth of Roll on/ Roll oV ferries, from the 1980s onwards, the Lo/Lo operations could not compete with the speed of Ro/Ro. Therefore, when the port was developed to provide the land for the new generation of ferries in the 1990s all available land was utilised for this. Irish Ferries has taken part in a number of consultation exercises to look at transferring Ro/Ro traYcto rail, the most notable of which was the “Piggyback Consortium” in the 1990s. However the punitive costs of upgrading the North Wales Rail Network to reach the West Coast Mainline at Crewe, and the lukewarm reaction from the road haulage industry, eliminated this as an option.

D3. Pembroke Dock Road Access From the M4 and the A48M, the A40 dual carriageway leads to Carmarthen and on to St Clears. From St Clears the single lane carriageway A477 takes vehicles on the remaining 23.5 miles to Pembroke Dock. From St Clears the single lane carriageway A40 goes to Haverfordwest and vehicles then take the A487 to Fishguard, a total of 35 miles from St Clears. The A477 has been improved and the A40 to Haverfordwest is in the process of being improved, however this is primarily to improve the roads at accident “black-spots”. There are no plans to dual the A40 to Haverfordwest in the near future, despite local political pressure to do so. This would not be in Irish Ferries interests as it may give customers choosing Fishguard a faster transit time. In terms of the business carried on the two “Southern Corridor” routes, Irish Ferries have the larger ship, so carried 63% of the freight on this corridor in 2008. However as Stena supplement their conventional vessel with a High Speed Craft in summertime; they carry a greater majority of passenger traYc, with 57% in 2008. This split of traYc between the two ports will continue to have a negative impact on any proposals to dual the A40 to Haverfordwest.

D4. Pembroke Dock Rail Access The position is much the same as reported in respect of Holyhead, but slightly worse as the railway lines now terminate about 2 miles away from the Port. June 2009

Further written evidence from Irish Ferries Irish Sea Ferry Routes and Operators 2009 There are up to 100 sailings per day between Ireland and the UK mainland, with 54% of them operating via Northern Ireland. The number of sailings do vary, based on seasonal traYc flows. The final section of this table lists the services and routes, from the Irish Republic, direct to mainland Europe.

Sailings Island of Ireland Port Operator British Mainland Port Up to . . . Daily Larne P&O Ardrossan 4 Cairnryan 18 Stena Fleetwood 6 Belfast Stena Stranraer 12 Norfolk Heysham 4 Liverpool 4 Warrenpoint Seatruck Heysham 6 54 Processed: 29-10-2009 23:00:05 Page Layout: COENEW [E] PPSysB Job: 435922 Unit: PAG7

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Sailings Island of Ireland Port Operator British Mainland Port Up to . . . Daily Dublin Norfolk Heysham 2 Liverpool 4 Seatruck Liverpool 4 P&O Liverpool 6 Stena Holyhead 8 Irish Ferries Holyhead 8 Dun Laoghaire Stena Holyhead 2 Rosslare Stena Fishguard 8 Irish Ferries Pembroke 4 46 Rosslare LD Lines Le Havre 1 Celtic Link Cherbourg 1 Irish Ferries C’Bourg/RoscoV 1 Coblefret Zeebruge 1 Cork Brittany Ferries RoscoV 1 5

Population Spread UK and Irish Republic The number of passengers and freight vehicles travelling through the Northern Irish Ports is disproportionate to the population of those areas. Eg Scotland has a population of 5.1 million and Northern Ireland has 1.8 million, yet 2.1 million passengers travelled on these routes in 2008. England and Wales have a population of 51.1 million and 3 million respectively, but only 3.1 million passengers travelled on the direct services routes to the Irish Republic in 2008. Therefore freight and passenger traYc, originating in or destined for England, does travel through the Northern Irish Ports. One other factor to consider is the geographical spread of the Irish population. The following table summarises the population totals for Britain and the island of Ireland. Of the total population of 4.3 million in the Irish Republic 52% live within two hours drive of Belfast. Therefore it follows that a significant proportion of freight traYc in Ireland is collected and delivered in this general area, ie from Dublin to the North and partly to the West, up to the Irish Land Boundary. If you take into account traYc congestion problems in the City of Dublin and the general port area, it is clearly expedient and competitive to bring freight and passenger traYc from the Irish Republic, to and from the Northern Irish ports. The crossing times and frequency of services are other factors which encourage the use of the Northern Irish ports to access the Irish Republic. There are up to 100 sailings a day in and out of the island of Ireland on 16 routes, with 54% of the crossings in Northern Ireland. Crossing times from the ports in Scotland can be as short a 1 hour 45 minutes. Some customers may prefer a longer road journey, followed by a shorter sea crossing. The attached table shows the recent population totals and spread, UK and Ireland, and focuses on the accessibility of the Northern Irish Ports in relation to the population spread, in the Irish Republic.

Area Population 2007 England 51,100,000 Northern Ireland 1,800,000 Scotland 5,100,000 Wales 3,000,000 UK Total 61,000,000 Republic of Ireland Province of Leinster 2,300,000 (East Coast), includes: Dublin County 1,200,000 Within two hours drive to Belfast Other Areas, 713,000 Within two hours drive to Belfast Other Areas, 396,000 More than two hours to Belfast Processed: 29-10-2009 23:00:05 Page Layout: COENEW [O] PPSysB Job: 435922 Unit: PAG7

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Area Population 2007

Province of Ulster 268,000 North Irish Republic, Within two hours drive to Belfast Province of Connacht 504,000 North West Ireland, More than two hours to Belfast Province of Munster 1,174,000 South West Ireland. More than two hours to Belfast Irish Republic Total Population 4,255,000

Sulphur Content Reduction Marine Fuel Oil The Marine Environment Protection Committee of the International Maritime Organisation has introduced further “MARPOL” controls to reduce the sulphur content in fuels. Additionally the EU has, through Directive 2005/33/EC, also introduced stricter controls within its jurisdiction. These measures are designed to reduce the pollutant eVects of Sulphur Dioxide, which include Acidification, local air quality and the emission of sulphate particles. The key dates that aVect the shipping industry are: — 1 January 2010—ships in port for more than two hours are not allowed to run their engines on heavy fuel oil, and must operate on marine diesel (0.5% sulphur content); — 1 July 2010—Sulphur cap in SECA’s (Sulphur Emission Control Areas) to be reduced to 1.0%; — 1 January 2012—Global Sulphur cap reduced to 3.5%; — 1 January 2015—Sulphur cap within SECA’s to be reduced to 0.10%; and — 1 January 2020—Global Sulphur cap to be reduced to 0.50%. Irish Ferries conventional ships currently run on fuel with 1.5% sulphur content, in line with the current EU position. This grade of fuel is still classed as heavy fuel oil or residual fuel oil. As the permissible sulphur content in fuel is reduced, there will be an issue for the shipping industry, to fund this significant increase in costs, for the higher grade of fuel. However there will also be an issue for the oil refineries, not only to produce suYcient quantities of low sulphur content fuel, but also how they deal with the residual heavy fuel, which is produced as part of the refining process and will no longer be required by the shipping industry. Currently, in European waters, the SECA’s are defined as the Baltic Sea, the North Sea and the English Channel. The volume of ships on the Irish Sea is considerably less than these areas, so at present there are no plans to nominate the Irish Sea as a Sulphur Emission Control Area. Processed: 29-10-2009 23:00:05 Page Layout: CWMEM1 [E] PPSysB Job: 435922 Unit: PAG7

Ev 104 Welsh Affairs Committee: Evidence car hall 1350 253 Last car thru 117314 Last car 0145 313 Last car 1353 Total Pax Remarks 149 4 1 50 16 Freight Unacc nil 14 ! 2 coaches 128 54 20 253 70 22 253 17 17 181145 42 91 15 TotalPax Cars Acc Freight P16D 8 1 nil 34 35 Freight Unacc INWARD TRAFFIC OUTWARD TRAFFIC 7 35 ! ! 2 coaches 2 coaches SUMMARY OF SAILINGS SUBJECT TO 100% CHECKS ON CARS BY UKBA Time Time Freight Sun 10/5 0100 0235Mon 11/5 1320 65 1435 70 Sat 9/5 1310 1455 80 53 Sun 10/5 1310 1430 52 22 Mon 11/5 0115 0235 37 23 DOA Arrived Sailed Cars Acc Processed: 29-10-2009 23:00:05 Page Layout: COENEW [O] PPSysB Job: 435922 Unit: PAG7

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Irish Ferries Concerns — The ferry business in general is suVering severely as a result of the economic recession, down over 25% overall YTD. The market is extremely price and service sensitive. The unwarranted targeting of pax traYc on a particular route, causing delays, will have a negative impact on our business, causing passengers to choose the many alternatives available. — UKBA checks, in the context of the proposed CTA changes, are said to be “risk based and intelligence led”. What was the basis and justification for stopping all pax traYc, the majority of which were UK and Irish citizens? — The impacts of the recession can be seen by examining the traYc columes. The law car figures are self explanatory. I have highlighted the drop trailers or “freigh unacc” in bold, because this is normally a substantial part of our business, with turnrounds of 130 drops per port operation, at the same time last year, ie 65 drops in and 65 drops out. The layout of the vessel means that deck 3 would take 4 rows of 9 drops, leaving 29 drops to go on deck 5, so the deck 5 operation in Pembroke would be to discharge 29 drops from deck 5 and load 29 drops, in addition to any hazardous cargo/running fridges. The actions of UKBA in stopping all of the cars coming oV deck 5, caused all of the traYc to back up onto the ship, preventing access to deck 5. Setting aside the issue of emergency access to this deck, the act of preventing access to deck 5 would have significantly delayed the turnround of the ship. To highlight this, look at the turnround for Sat 9/ 5, where we had to handle an 84 drop turnround. The ship was 25 minutes late leaving, which would have been considerably worse if the freight and passenger numbers were back to normal. — If you project the actions of the UKBA onto busier passenger sailings and busier freight sailing, you will see the exact results that Irish Ferries have predicted would occur. It will inevitably cause delays in the turnrounds that will directly impact negatively on our business. Irish Ferries are not satisfied that the actions of UKBA are reasonable and fair and they appear to take no account of the concerns already raised over the proposed actions under the CTA proposals. On the latest statistics available for our car passenger traYc in 2008, this really is “a sledgehammer to crack a nut”. In 2008 our own statistics showed the following: — 61% of pax were resident on the British Mainland; — 32% were resident in the Irish Republic; — 2% were resident in Northern Ireland; — this left 5% non UK or non Irish, of which 1.1% were German and 0.3% were French; and — this leaves a balance of 3.6% of other nationalities. July 2009

Written evidence from the Isle of Anglesey County Council Executive Summary Anglesey faces serious economic challenges, and local deprivation is concentrated around its port areas. Holyhead port is a critical generator of jobs and income for the local economy. Government should support projects which will safeguard this, and more eVectively exploit and develop the port’s potential and contribution to the local economy. Key projects in this respect include the proposed cruise ship terminal, the planned direct road link between the port and A55, and the need for a lorry park facility. The extensive harbour has many uses with scope for more, and the waterfront area is subject to ambitious development plans.

1. Introduction 1.1 Anglesey County Council welcomes the Welsh AVairs Committee’s decision to hold an inquiry into the issue of Ports in Wales. Anglesey has a number of ports and harbours located around our coastline, but most of our evidence inevitably relates to the port of Holyhead due to its size and status.

2. Economic Context 2.1 Anglesey faces a number of significant economic challenges, and now has the highest unemployment rate of any county in North Wales. The Island has seen the erosion of its industrial base in recent years. This will be added to by the closure of Eaton Electrical in late 2009, and a decision on the future of Anglesey Aluminium is expected shortly, both in Holyhead. Processed: 29-10-2009 23:00:05 Page Layout: COENEW [E] PPSysB Job: 435922 Unit: PAG7

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2.2 There is generally a correlation between economic prosperity and proximity to the mainland. The Island’s socio-economic problems are particularly severe in the wards surrounding the port of Holyhead, and also that of Amlwch Port. Of the 10 LSOA’s on Anglesey with the highest unemployment rates, seven are in Holyhead, and one is in Amlwch Port. These areas account for five of Anglesey’s six Communities First wards. 2.3 It is important that government encourages and supports plans to more eVectively develop the economic potential of ports, especially in areas of high socio-economic need such as Anglesey.

3. Ports and Harbours of Anglesey 3.1 Holyhead Holyhead is a major strategic port of great importance as a link between the UK and Irish Republic, and it is dealt with in detail in the remainder of this report.

3.2 Amlwch The narrow harbour of Amlwch was originally developed to serve the copper industry. During the late 1970s it was improved to serve the needs of oil importation from tankers, for transfer to the nearby Rhosgoch tank farm, and from there via pipeline to Stanlow in Cheshire, but this operation was shortlived. The nearby Great Lakes (previously Octel) bromine works was the town’s major employer—it has now closed, but there are plans by gas company Canatxx to use it to land and refine Irish Sea gas. The main users of Amlwch harbour today are private leisure craft, boat excursion operators, and commercial fishing boats. The harbour also provides a base for pilot vessels of the Mersey Docks and Harbour Company, assisting large ships travelling to Liverpool. There are plans to develop the historic harbour area as a tourist destination. Anglesey County Council is the local harbour authority.

3.3 Beaumaris Although historically a port, Beaumaris now lacks a sheltered harbour. Current facilities include a leisure pier, moorings, and a boatyard, which are used by private leisure craft and by tourist or fishing boat excursion operators. A proposal for a new marina has recently been thwarted due to opposition by mussel fishermen and related agencies, and the decision has thrown in doubt the legality of some 400 Menai Straits moorings.

3.4 Menai Bridge The modern pontoon pier is used by research vessels of the nearby University of Wales Marine Science department, and by some leisure and small commercial craft. As in Beamaris, the pier and moorings are owned and managed by the County Council.

3.5 Cemaes There is a small sheltered harbour in Cemaes which was built to serve the needs of local past industry. It is now used by leisure craft and a small number of fishing boats and charter boat operators. The harbour is owned and managed by local trustees.

3.6 Other Harbours There are various small-scale jetties, slipways, and other maritime facilities around the Anglesey coast, mostly related to leisure craft usage.

4. Holyhead Port 4.1 Holyhead’s Harbours Holyhead’s use as a harbour dates back to Roman times. Its development as a major port was linked to the building of the A5, the extension of the railway from Chester, and the Admiralty’s decision to create a large harbour of refuge. Holyhead’s role as a strategic transport node has been reinforced by the building of the A55 dual carriageway from Chester, part of a designated Euroroute (E22). Recent port infrastructure developments have been focussed on the East Dock side of the Inner Harbour, and on Salt Island from where deeper water can be reached.

4.2 Port Employment Holyhead Port is one of Anglesey’s major employers, providing approximately 900 jobs. Stena accounts for well over half of these, with the remainder being in Irish Ferries, port service companies, transport and other businesses, together with some public sector staV in the port police and customs. Stena has sited some of its UK-wide service and support operations locally. Given other job losses, it is essential that government supports port employment. Processed: 29-10-2009 23:00:05 Page Layout: COENEW [O] PPSysB Job: 435922 Unit: PAG7

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4.3 Ferry Services Holyhead is the busiest ferry port in Wales, handling about 2.3 million passenger movements each year. There are two ferry companies operating a total of five ferry vessels, and both have invested heavily in developing new berths and port related facilities. The ferries carry foot passengers, cars, coaches, and lorries, varying by vessel. Foot passenger numbers has declined in recent years, but the number of lorries using the ferries has increased very significantly.

4.4 Sea Freight The bulk of sea freight activity via Holyhead involves lorries using the ferries to transport goods to and from Ireland. (There used to be a sea container facility on the East Dock, but the company withdrew and the site was later redeveloped for ferry uses). Other significant freight operations involve the import of fuel to the port and of aluminium ore to Anglesey Aluminium, and the export of aluminium ingots. The ore is landed on a purpose-built jetty, and is transported via underground conveyer to the smelter (the possibility of also using this to import wood chip for a power station is now being considered). There are other occasional freight uses, eg the export of stone for marine works. It is hoped that storage and distribution facilities and related jobs can be attracted to the new Parc Cybi business park.

4.5 Port—A55 Link 4.5.1 The growth in ferry traYc, especially lorry numbers, has led to stresses on the transport network. Problems occur at the Britannia Bridge, and in some other locations along the North Wales coast. A particular problem for Holyhead is the “missing link” between the port and the A55 dual carriageway. The access to and from the port for road traYc needs to be improved to avoid conflict with local traYc, and to reduce congestion, especially for traYc exiting the port. 4.5.2 A scheme has been prepared to address this by creating new direct road link between the port and A55 Junction 1. This will require the relocation of the existing railway depot from near the town centre, and it is proposed to relocate this to land adjacent to Anglesey Aluminium. With support and funding from WAG, Anglesey County Council have been working for several years to plan and design up this project, which now has a cost of about £20 million. A bid for EU Convergence funding has been made, and it is vital that funding is provided to allow the scheme to proceed.

4.6 Lorry Park Due to the volume of freight traYc using the A55, there is a need for a suitable truck stop/service area for lorries. Drivers are now forced to use normal roadside lay-bys to stop and rest to achieve their mandatory breaks, which has resulted in environmental and other problems in those locations as there are no facilities. A lorry park would address this problem and could generate local economic benefits.

4.7 Environmental Impact There are inevitably some localised environmental impacts due to port operations and traYc. The London Road ward has the worst scoring on Anglesey in terms of the WIMD 2008 health indicator. It is expected that pollution levels in local residential areas will be reduced if the rail depot is relocated, and if lorries can access the A55 directly without having to queue slowly over Black Bridge.

4.8 Port and Rail About 0.5 million people use Holyhead station each year, most being ferry users. Ferry and train times are reasonably well timed, but the locality benefits from some delay. The Town Council operates a left luggage facility to encourage ferry/rail users to visit the town rather than wait in the terminal. The railway station has seen some limited improvement works, but is clearly in need of a significant physical upgrade, including updated signage and information for passengers.

4.9 Rail Freight There are currently no rail freight facilities at the port of Holyhead. The North Wales Rail Strategy Study includes the option of a rail freight terminal at Holyhead, which should reduce the large number of heavy lorries that now operate along the A55. The North Wales railway line is not currently used by container traYc, and there are gauging and terminal issues to overcome. A rail gauge upgrade is a possible long- term option.

4.10 Cruise Ships 4.10.1 About 5–10 cruise ships have been calling into Holyhead each year, most carrying a few hundred passengers, but there have been several calls by larger ships with around 2,000 passengers. Most cruise passengers tend to go on day or half-day coach excursions, and the cruise ship companies receive much of their income from these. Processed: 29-10-2009 23:00:05 Page Layout: COENEW [E] PPSysB Job: 435922 Unit: PAG7

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4.10.2 Typically 25% of passengers from large ships will not go on coach excursions and will walk around the town or visit other places by taxi. Many crew members will also come ashore and spend in local shops. The County Council has arranged events in the town centre on large cruise ship call days. Related initiatives have included customer care courses for taxi drivers, training local “green badge” tourist guides, and arranging short local excursions. 4.10.3 The Cruise Wales partnership aims to develop Wales’ potential as a cruise destination. Economic studies have been undertaken to measure the economic impact of cruise calls and predict how this is likely to increase in the future. Anglesey County Council is an active member, and will lead the EU Interreg funded “Celtic Wave” joint marketing project for several Irish Sea cruise ports. 4.10.4 Smaller cruise ships berth alongside in the Inner Harbour, but larger cruise ships must anchor outside the port and transport their passengers ashore via small tenders. This is very time consuming and risky. Several large cruise ships have cancelled the landing of passengers using tenders due to conditions on the day being unsuitable. Most cruise lines have now decided to avoid tendering in. The development of an alongside cruise berth is therefore essential to ensure that Holyhead attracts cruise ships in the future, and we are most anxious that this project receives full government support.

4.11 Marine Leisure The 24-hour outer harbour is well used for marine leisure activities, and there is space and potential for further usage. The local sailing club has a large membership and manages yacht moorings. A private yachting marina has been established which now has a blue flag and about 200 berths, together with an onshore development of commercial units and apartments.

4.12 Tourism The port makes a significant contribution to tourism in Wales and Ireland. EVorts have been made to increase the level of ferry passenger spend on Anglesey by providing visitor information on the HSS ferry, in A55 lay-bys, and at the ferry terminal, and further marketing initiatives are planned. Holyhead benefits from spends by tourists who are en-route to or from Ireland, and local guest houses rely on ferry users for much of their business. A budget hotel has recently been built, and there is further hotel interest.

4.13 Local Spend by Ferry Users Ferry users generate a significant level of spend in Anglesey service sector businesses in Holyhead town centre, Holyhead retail park, and other places along or near the A55. The relocation of the port access from the west to the east side of the harbour during the early 1990s adversely impacted on spend in the town centre, and the planned new port access road link scheme on the west side should see many more car and coach-based ferry users stopping and spending in the town.

4.14 Ferry Timings Ferry frequencies and timings have a significant impact on how many ferry passengers visit the town and how much they spend. Timings are currently not as favourable as they used to be for return day trips between Wales and Ireland. Ferry delays or cancellations can result in a significant influx of passengers into the town.

4.15 Port Heritage The port includes a large number of historic buildings and structures, many of which are listed as being of historic interest, and a study has been undertaken in conjunction with Cadw. The care of these buildings and structures largely fall on Stena Ports Ltd as port authority. An excellent Maritime Museum is operated by local volunteers in a building leased from Stena, and there are plans for a large expansion to show more of the many artefacts.

4.16 Other Port and Harbour Users There are very many other users of the port and harbour. These include the RNLI, RAF, Customs, Navy, visiting ships, survey vessels, Sea Scouts, small boating associations, leisure divers, outdoor pursuits operators, among others.

4.17 Holyhead Breakwater The 1.5 mile long breakwater is a dramatic historic structure which forms the large Outer Harbour, dating back to the early 1800s. The structure is now in need of a major strengthening and restoration scheme. Without these works, the breakwater is in danger of partial collapse. It is hoped that the scheme will also provide for leisure and amenity use of the structure. Processed: 29-10-2009 23:00:05 Page Layout: COENEW [O] PPSysB Job: 435922 Unit: PAG7

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4.18 Port and Regeneration Recent urban regeneration works by the County Council have targeted run-down areas facing the port, and further works are planned. These schemes will integrate with the planned Port Access Road scheme. The recently built Celtic Gateway bridge provides an easy and DDA compliant link between the town centre and foot passenger ferry terminal/railway station, and is also well used by Morawelon area residents. Stena is an active partner in the local regeneration partnership and related initiatives.

4.19 Waterfront Potential Holyhead’s extensive waterfront has been recognised as a key asset for the future regeneration of the town. Port owner Stena has formed a joint venture property development company with London based developers Conygar, and plans for an ambitious mixed-use development for part of the Outer Harbour waterfront are in preparation.

4.20 OVshore Developments Holyhead is well sited to be a base for servicing oVshore developments, and large drilling rigs are sometimes seen in the harbour. Further windfarms are expected in the Irish Sea, together with marine turbines. There are currently constraints in terms of uses that would require very large areas of portside standage.

4.21 Marine Industry The closure of the Marine Yard in the 1980s was a severe blow, but its tradition continues on a smaller scale. Holyhead Boatyard employs about 60, involved in specialist boatbuilding and repairs, but also in many shipping and overseas activities. There are also many other smaller marine businesses in and around the harbour, and this sector clearly deserves to be encouaged and assisted to grow.

4.22 Fishing Industry Holyhead is North Wales’ most important commercial fishing port. It is a base for small inshore vessels, but also sees calls by larger trawlers. Almost all fish landings (c£3 million per annum by value) are transported direct for sale outside Wales. The DEFRA Fisheries oYce for North/Mid Wales and the North Wales Fishermen’s Association are both based in Holyhead. There are several facilities for fishing boats, including a Council managed Fish Dock, and EU fisheries funding is available for related works.

4.23 Port Authority The statutory port authority is Stena Ports Ltd, a port management company which is part of the international Stena group. Although a private company, the functions of Stena Ports Ltd reflect those of a public sector authority in many respects. The port authority’s status as a privately owned company has constrained the availability of public funding to some important projects due to funders concerns and uncertainty about EU state aid regulations. June 2009

Supplementary written evidence from the Isle of Anglesey County Council Following the oral evidence session at the House of Commons on Tuesday, I have a further point which I would ask the Welsh AVairs Committee to consider as an annex to the Council’s evidence.

It was clear from the Committee’s line of questioning that it wished to focus on the UK Government’s role in respect of cruise development. However, while ports in Wales are indeed a UK government responsibility, responsibility for tourism (including cruise) is devolved to the Welsh Assembly Government.

As such, there is a danger that both policy and implementation will be less than fully “joined up”. Margaret Llewellyn did mention the prospect of devolving responsibility for ports in Wales to the WAG, and I would support this for this reason. July 2009 Processed: 29-10-2009 23:00:05 Page Layout: COENEW [E] PPSysB Job: 435922 Unit: PAG7

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Written evidence from Milford Haven Port Authority (MHPA) 1. As an introductory background, Milford Haven Port Authority (MHPA) operates the largest port in Wales and the sixth largest port in the UK (as measured in the tonnage of cargo through the port). The turnover of the port in 2008 was £18.5 million producing an operating profit of £740K and a profit before tax of £4.4 million. As a trust port with no shareholders, MHPA is statutorily required to operate as a commercial, profit making business but with the profits invested for the benefit of existing and future users and stakeholders of the port.

Policy Framework 2. Ports other than what are termed fishing ports are not a devolved responsibility and therefore MHPA has a formal relationship with UK Government at Westminster, through the Ports Division of the Department for Transport. Our act requires that we provide our audited annual accounts to the Secretary of State for Transport and the appointment of the 10 non-executive members on the Board of the Authority (alongside the three executive members) are made by the Secretary of State—through a process that complies with standards of governance, Nolan Principles etc. Indeed the DfT has identified and recently updated through a review of ports policy the standards of governance and performance expected of trust ports and as issued in the document “Modernising Trust Ports 2” which itself builds on a similar document produced following a review of trust ports in 2000. MHPA complies with all the requirements of these standards and will continue to do so. 3. A current issue outstanding with UK Government is the fact that over four years ago, a ruling by the OYce of National Statistics identified MHPA along with a number of other large trust ports as having public corporation status and therefore ostensibly subject to public sector borrowing requirements. This was a state of aVairs that neither we, nor indeed the Department and Treasury required and on the Department’s advice a Harbour Revision Order was promoted to removed the two criteria which the ONS decision had been taken—the ability of the Government to compulsory privatise under a clause in the 1991 ports act and the view that the port was Government “controlled” because the majority of Board members were appointed by the Secretary of State. This HRO was objected to by private ports and therefore the Department put it in suspension, awaiting outcome of the recent ports policy review which would identify new and updated standards for trust ports. It is expected that the HRO will therefore be resurrected and passed during the middle of 2009, thereby removing the threat to the investment and development capability of MHPA. 4. Whilst not a devolved responsibility,MHPA recognises that increasingly Welsh Assembly Government sets the framework within which we as a business, located in Wales have to operate. It is therefore important that we build communication and partnership at a number of levels, so that we both promote an understanding of the value and role of the port in the Welsh economy to feed into policies and strategies being developed by WAG and also have an opportunity to make our views known as part of the process of establishing such strategies. 5. As well as informal and formal links that we have established with WAG at a variety of levels and in various departments, a more recent move has been the agreement to establish a Welsh ports group to have regular if not frequent contact with WAG and be a means of communication, discussion and identification of relevant issues. The first such meeting will take place in June of this year.

Contribution of Welsh Ports 6. The overall contribution of Welsh ports has been covered in the response to this inquiry made by the British Ports Association, of which MHPA are members. 7. As a port MHPA supports two refineries that produce over 20% of the UK’s production of petrol and diesel, the largest tank farm in the UK and Irish Ferries one of the major ferry operators on the Irish Sea, running between Rosslare and Pembroke Dock, in addition MHPA is the largest fishing port in Wales, with around 4,000 tonnes of fish landed each year in Milford Docks. More recently the well heralded advent of Liquefied Natural Gas shipping into the port has taken place with the recent opening of the South Hook Terminal and the expected opening of the Dragon LNG Terminal this summer. Between them, these two terminals have the capacity to provide over 25% of the UK’s gas requirements for decades to come. 8. On top of that, MHPA employs 200 staV, which whilst small in one sense is nevertheless a significant employer in the local context, given that Pembrokeshire is very much a small enterprise economy.

Increased Trade with Other Countries 9. Cargos of crude oil to the two refineries are mainly sourced from the North Sea nowadays but with occasional cargos from elsewhere eg West Africa. It is expected that with investment in the refineries enabling them to deal with diVerent ranges of crude oil and with the decline in output from the North Sea, that there will be an increase in crude oil coming from other parts of the world in increasing measure in years to come. One refinery in particular, sees opportunity for bringing more crude oil from the Caspian. Processed: 29-10-2009 23:00:05 Page Layout: COENEW [O] PPSysB Job: 435922 Unit: PAG7

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10. The refined product of the refineries goes out in the main by sea in smaller coastal tankers to serve the UK, Ireland and Northern Europe. Smaller proportions go out by pipeline, rail (Murco) and a very small amount by road. A significant proportion of petrol produced also goes to the USA, particularly from Chevron, which is a reflection of the imbalance between production capacity and market demand for petrol and diesel in Northern Europe and indeed in the USA. Murco have plans to increase capacity and a likely consequence of that will be exports to the USA.

11. The SemLogistics tank facility imports and exports from a wide range of sources.

12. Irish Ferries services used in the port provide a link within the southern TENS route running through Wales and like other ferry operators are experiencing a downfall in traYc particularly rated to the even more significant reduction in the Irish economy than that in the UK and elsewhere in Northern Europe.

13. As a port, we recognise we have spare capacity in our ferry terminal and are actively pursuing other routes and opportunities and in particular are working with the Port of Ferrol in North West Spain to develop a new freight service for unaccompanied freight vehicles.

14. We are also looking to expand other general cargo in the port which as we do not have an industrial hinterland nor good road/rail connection to the rest of Wales and the UK, is largely focused on local agriculture and engineering sector in West Wales.

15. Very real and significant opportunities exist however for the port and Pembrokeshire to establish facilities to serve the emerging marine renewable energy industry which will see massive explosion over the next decade as the UK seeks to meet its CO2 targets (and these for Wales are even more challenging). The key to opening up the potential is the development of the last significant brownfield site with water access which is currently owned by Pembrokeshire County Council with interest from WAG with both of whom we are working hard to bring this about.

Increase in Freight Movements and Adequacy of Transport Infrastructure 16. The Port of Milford Haven and indeed the Pembrokeshire economy is one of the two strategic Trans- European routes identified in Wales of which the northern corridor, along the A55 to Holyhead has received significant attention, support and investment by Welsh Assembly Government in recognition not only of its strategic value in the European context but also the benefit that such improvements bring to the economy through North Wales and into Anglesey and Holyhead.

17. On the other hand there has been a continuing and significant failure by WAG in failing to follow through on expectations raised of a similar approach to the southern corridor, particularly focused on the dualing of the A40 from St Clears. This not only hinders the development of increased freight and indeed other vehicle traYc through the ferry ports of Pembroke Dock, (within Milford Haven) and Fishguard, but also holds back the Pembrokeshire economy in the perception that this third grade level of infrastructure gives to potential developers.

Tourism 18. There is a very real potential for Wales to participate in the still expanding cruise market. MHPA have been seeking to promote the port and West Wales to the cruise industry for the past 10 years, through attendance at the annual Seatrade exhibition conference in Miami and membership of Cruise Europe, Cruise UK and being one of the founder members of Cruise Wales. We have had modest success with 6 or 7 cruise ships using the port of Milford Haven each year and through research and work undertaken by Cruise Wales, see potential for significant increase in this providing that we can obtain the necessary infrastructure ie an alongside berth for vessels up to 300 metres in length to meet the full needs of the cruise ships. At present only ships of 150 metres can go alongside at Pembroke Port. Above this size they anchor and tender their passengers into Milford Docks, which is perfectly feasible but expensive for the ship operator and indeed the port and also does not maximise the potential for the local economy in making it as easy as possible for passengers and crew to come ashore, experience the locality and of course spend their money and perhaps in so doing decide to come back again as individual tourists.

19. Another aspect of tourism is that of marine leisure in which the 60 square miles of sheltered waterway in the port of Milford Haven are an existing and increasing attraction; supported by the 2 marinas, one in Milford Docks, owned by MHPA and the other privately owned in Neyland. In addition the Authority manages over 1,200 moorings throughout the waterway and planning permission has been granted for a new housing development, supported by a 300 plus berth marina at Pembroke Dock. A proposed marina at Fishguard will also enhance the marine leisure facilities in South West Wales and be part of what Welsh Assembly Government have previously identified in their marine leisure strategy as moving towards a necklace of marinas thus increasing the potential for greater tourism use of one of Wales’ major assets, its coastal waters. Processed: 29-10-2009 23:00:05 Page Layout: COENEW [E] PPSysB Job: 435922 Unit: PAG7

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Security and Policing 20. As a port that has had ferry links to the Republic of Ireland since the 1970s MHPA has operated within the Aviation and Maritime Security act for decades, with the terrorism threat of the IRA. More recently with the introduction of the International Ship and Port Facilities Code (ISPS) which was brought in July 2004 as an international response to the USA’s requirements for extra security provision following 9/11, the port and all facilities within it operate under the requirements of this code. This is monitored by TRANSEC and each facility within the port provides and manages a plan to meet TRANSEC’s requirements which are then tested and practiced on a regular basis. 21. On top of this of course with the major COMAH sites of the three oil terminals and now the two LNG terminals which operate under similar very strict security regime monitored by the security services, there is an obvious link between the port and terminal security provision. 22. Whilst the ISPS Code does not work in this way, we as a port have through our initial participation in the MATRA pilot project worked in a collaborative way, sharing information and indeed assets rather than in isolated silos. This is undertaken through the Port Security Committee which is chaired by MHPA’s Chief Executive and on which each of the terminals, together with the police, special branch, TRANSEC, civil contingency oYcers and others serve. With the European Security Directive for ports coming in in the near future, this model will be easily transposed to its requirements. 23. Another concern for Welsh ports is the UK Border Agency’s move to stop the unfettered sea travel between Eire and the UK which has been in place for over 80 years and enforce passport style security requirements. Whilst this obviously has political dimensions in our relationship with the Republic of Ireland and has come under criticism from the EU in introducing diVerential standards between EU states, it also poses severe operational problems for ferry companies and ports. 24. I hope the above gives a brief response to the primary areas of investigation, but I would be happy to expand on any and if required to give further comment or evidence in due course. June 2009

Supplementary written evidence from Milford Haven Port Authority Port Rates A point which I think the Committee are aware of but we did not have time to explain in any detail is that of the change to the rating system for ports in England and Wales and in particular the unfair manner in which significant extra charges are being backdated to 2005. At Milford Haven we only recently received the results of the revaluation exercise by the Valuation OYce—one of the last ports to be informed. We are facing potentially significant increases in our costs going forward and have engaged specialist advisors to help us review these and work with us on our response to the valuations now received. I expect that the result of this is that we will be discussing the new valuations with the Valuation OYce and challenging some of their assumptions and calculations and if we cannot get agreement as a result then be looking at entering into the formal appeals process—although I understand that to do so one needs to pay any outstanding amounts before an appeal will be considered. The real problem however is the backdating to 2005 coupled with the change in tactics/system from the Valuation OYce to separately assess tenants in ports for business rates whereas previously they were part of an overall assessment for the port. This means that as well as now facing rate demands which they did not receive before, our tenants are also facing backdated demands for payments from 2005 of which they had no previous knowledge and had run and priced their businesses accordingly. Thus whilst they can take a view on how to manage their business going forward to take into account this new, extra cost being imposed on them as a result of the change in the system they have no means of recovering the outstanding demands from 2005 other than as an immediate hit on their current financial position. There have been reports from various parts of the UK (or rather England and Wales as I understand that the Valuation OYce in Scotland did not operate in such an inept, ineYcient and unfair manner as their counterparts south of the border) as to the eVect of this on ports and businesses within ports with some businesses folding and/or laying oV staV because of the retrospection. With us the position is only now becoming clear and leaving aside the increased costs on business going forward (and this at a time of increasingly diYcult times for all businesses in the current economic situation, but especially those businesses involved in trade and transport) it looks as though Irish Ferries are facing a backdated bill of over £300k which is a big hit for them when ferry traYc to/from Ireland is falling heavily. Processed: 29-10-2009 23:00:05 Page Layout: COENEW [O] PPSysB Job: 435922 Unit: PAG7

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In Milford Docks the actual amounts and sizes of the businesses aVected are much smaller (and very small when compared with some of the headlines elsewhere in England/Wales) but nevertheless given that Pembrokeshire is an SME economy the results can be no less dramatic and concerning to the individuals involved as elsewhere. Thus in Milford Docks there is a 30% increase in business rates required going forward compared to the previous situation. This increase is coming from what is now a separate assessment on four of our tenants who were not charged rates previously as we paid rates for the whole of Milford Docks in our ownership assessment and the rental agreements we had with these tenants was set at a level to take this into account. Now our bill going forward is the same as it was previously so we are neither getting a rebate to oVset some of the extra costs being levied by the new system nor are we in a position to reduce the rents to our tenants to help them to meet the extra costs they are facing. When you add to this the lump sum backdated bill then it is causing such tenants problems. One of our tenants is a one man operation—a joiner/kitchen fitter. He is facing over £3,000 as a backdated bill which to him is significant as he makes the point that he sets his charges to take into account his overheads, he is on the limits of cash flow and profitability in the present circumstances and to him an extra £3,000 could be critical. There is no way he can go back to his previous clients and say that because he has just received a backdated rates bill covering the time when he did work for them, of which he knew nothing before and therefore had not priced in to the job he requires them to pay some more. Another is a small fish processor which is facing a £6,000 backdated demand and will really struggle to find the means to pay it. Yet another is the Waterfront Gallery which subsists on a knife edge of viability (after support from us and others) and is facing a demand for £19,000. They have approached Pembrokeshire County Council who apparently tell them that whilst they might have some discretion in dealing with a charity on a running basis going forward they have no such discretion on this backdated payment demand. The outcome of this for the gallery is quite simply that if £19k is not removed the Gallery will close. Yet another is an engineering company who employ 26 skilled engineers and welders and who face a backdated bill of £20,000 which is a significant cost to a business of their size, and they also tell me that if they do have to pay this they will have to look at reducing costs which will probably mean laying people oV or moving some from full to part time. So in summary in this tiny area of Milford Docks alone we are looking at the consequences of this backdating a charity/community enterprise closing, an engineering company laying people oV and small entrepreneurs really struggling to keep their heads above water at a time of massive other pressures on their cash flow and their businesses. This has been taken up by the Treasury Select Committee and the House of Lords both pointing out the unfair nature of the backdating and recommending that the change to the new system does not take place until 2010 thus allowing ports and businesses time to prepare and price in any increase in costs. Both our local MPs have taken up the issue as have many others with port interests and there is an industry wide protest across England and Wales.

Margaret Llewellyn’s Evidence I was surprised to read some of the evidence put forward by Margaret Llewellyn on behalf of Cruise Wales of which Milford Haven Port Authority is a member, and indeed currently supplies the Chairman. Some corrections to her comments on Milford Haven. She is not correct in stating that MHPA do not make a profit, nor in my view is she correct in drawing an unfavourable comparison with the “proper commercial returns” made by Dover and inadequate returns made by MHPA. The two ports are very diVerent in the way they operate and the traYc handled so comparisons are as she correctly implies more about levels of profitability and return than overall quantity. However she has her facts/opinions wrong. In 2008 Dover’s turnover was £60.8 million and made a profit before tax of £16.6 million, which was 27%. Milford Haven Port Authority had a 2008 turnover of £18.5 million and a profit before tax of £4.7 million, which was 25.3%—by no means dissimilar.

Border Agency Evidence I have read reports of the evidence given by the UK Border Agency and would comment that the full picture is not being given, indeed the evidence is potentially misleading. For example the figure of 179 refusals of entry last year in some 4,700! arrival sailings into Welsh Ports, and almost 3 million passengers is actually a very low level indeed—less than 0.012% of passengers are illegal immigrants, and rather than illegal immigrants being found on “virtually every crossing” if each of the 179 travelled on a diVerent crossing less than 4% of crossing would be involved. The reason put forward for the proposed change to the Common Travel Area, which would cause severe operational problems for Welsh ports and ferry operators, is that the immigration controls in the Republic of Ireland are not working thus allowing backdoor entry into the UK. All EU states are meant to operating equally with such controls. What representations have UKBA made to the EU of their view of the Republic of Ireland’s failure to comply? Processed: 29-10-2009 23:00:05 Page Layout: COENEW [E] PPSysB Job: 435922 Unit: PAG7

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Where is the logic of imposing controls over the sea crossings between the UK and Eire but not over the land boundary through Northern Ireland? Only imposing such controls on sea crossings between say Belfast and Stranraer would first of all leave part of the UK (Northern Ireland) unprotected from the perceived risk that such measures would be intended to resolve and also introduce passport style controls for sea travel between two parts of the UK. Is that acceptable? July 2009

Written evidence from the Port of Mostyn Ltd 1. Summary 1.1 Regulatory Regime 1.1.1 The UK and Welsh ports policies are not suYciently robust to give developers guidance and confidence when considering potential investments. 1.1.2 The existing regulatory system for obtaining the necessary consents for the development and operation of ports is fragmented and ponderous. This situation is likely to be exacerbated in the coming months by organizational changes and additional legislation. 1.1.3 With the decline of manufacturing in Wales, alternative business for ports must be secured. The emerging oVshore renewable energy sector presents a good opportunity but this will require port projects to be consented and constructed in a timely manner. Failure to do so may result in investment being made outside the UK.

1.2 Port Development Opportunities 1.2.1 Opportunities to develop large scale bulk and conventional cargo handling facilities in Wales is likely to be confined to bulk liquid handling.

1.3 Cruise Market Opportunities 1.3.1 Development in Welsh ports of dedicated cruise terminals as turn-around ports is hampered due to insuYcient passenger numbers and geographic location. Opportunities for cruise ship transit calls can developed but the economic benefit these will bring to the port and local economy will be limited.

1.4 Container Terminal Opportunities 1.4.1 Similar to the bulk cargo-handling sector, declining industrial and manufacturing activity makes container terminals in Wales unnecessary. Global container services can be operated using Portbury and Mersey facilities alongside feeder services from major UK and Continental ports.

1.5 Policing and Port Security 1.5.1 My knowledge of other Welsh ports on this matter is limited. However from my experience at Mostyn, policing and security measures in place are not unduly intrusive.

2. Introduction 2.1 I am Jim O’Toole, Managing Director of The Port of Mostyn Ltd in Flintshire. I am a Deputy Lieutenant to the Clwyd Lieutenancy and a past Chairman of the North Wales CBI, which I represented on the North Wales Economic Forum. I am also a member of the Bank of England Advisory Panel for North Wales, and also represent Welsh ports and industrial interests on the Dee estuary relating to the Water Framework Directive. I have more than 50 years experience in the shipping and ports industries.

3. Regulatory Regime 3.1 Ports is a reserved matter and current UK policy is contained in the document “Modern Ports”—a UK Policy, Nov 2000. The Welsh Assembly Government‘s parallel policies on ports are contained mainly in two policy documents: The Wales Freight Strategy, May 2008 and Wales Transport Strategy, April 2008. Neither of the Welsh documents contain what could be regarded as firm policies for Welsh port development, indeed the Transport Strategy document makes no more than a passing reference to ports and sea transport. 3.2 The Wales Freight Strategy document provides an overview of the Welsh ports sector and contains 10 policy statements. However, scrutiny of the policy statements shows they are little more than intentions to “continue to review” and to “continue to monitor” various strategies for potential port development. 3.3 I am therefore not convinced that the Welsh Assembly Government fully appreciates the importance of ports to the Welsh economy, hence its lack of firm policies, which the industry can rely upon when considering development plans. Processed: 29-10-2009 23:00:05 Page Layout: COENEW [O] PPSysB Job: 435922 Unit: PAG7

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3.4 The necessary regulatory consents which all UK ports must obtain in order to carry out both capital and maintenance works in their harbours and navigational channels are usually a Section 34 Consent under the Coast Protection Act 1949 (CPA) to carry out the dredging works, and a consent under the Food and Environmental Protection Act 1985 (FEPA) for the disposal of the material being dredged. 3.5 In some cases, such as at Mostyn, a further consent, being a Land Drainage Consent to disturb the riverbed must also be obtained from the Environment Agency (Wales) (EAW) under the Water Resources Act 1991. Moreover, in addition to these consents, an “Assent” from the Countryside Council for Wales (CCW) under the Countryside Rights of Way Act 2000 to carry out works within the harbour is also required. 3.6 About 70% of the UK’s ports are located on estuaries, which invariably are subject to one or more conservation designations under the EU Habitats and/or Birds Directives. The interpretation of these Directives by the UK Regulators is seen by the ports sector as very restrictive when compared against the interpretation used by our European competitors. 3.7 For example, in other EU countries, harbour areas and navigational channels are generally excluded from conservation designation, whereas in the UK they are totally included, resulting in a direct conflict between industry and nature conservation which makes it considerably more onerous, time consuming and expensive to obtain the necessary consents for our ports to develop. 3.8 It is often said that when Directives arrive in Westminster from Brussels they are then gold plated by the UK Regulators. I would add that when they arrive in CardiV the Assembly gives them a coat of platinum for good measure, making Wales the most diYcult country within the EU to obtain consents to develop and operate a port. Surely this must ultimately be to the detriment of the Welsh economy. 3.9 To complicate matters, the processing of applications under FEPA is currently undertaken by the Marine and Fisheries Agency (MFA) in London on behalf of the Assembly. Moreover, the scientific and technical expertise required to assess Environmental Impact Statements which dredging and disposal consent applications inevitably require, is not readily available in Wales and this work is therefore usually carried out by the Centre for Environment, Fisheries & Aquatic Science (CEFAS) based in Lowestoft. 3.10 In my experience, there is a reasonable degree of co-operation between the numerous regulatory organizations involved in dealing with consents. However, the extended administrative chain inevitably results in more time and resources being demanded not just of the Regulators, but also of the applicants in order to process consents for channel and harbour works at Welsh ports. 3.11 Whereas the present arrangements make life diYcult enough for ports to gain consents to undertake essential works, the situation in the near future is likely to be even more complicated and more onerous for the following two reasons. 3.12 The first reason being that in addition to the existing legislation under which ports are presently regulated, two new pieces of legislation are approaching the Statute Books. These are the EU Water Framework Directive which is currently at a public consultation stage, and the Marine and Coastal Access Bill, (Marine Bill) which is due to come into force later this year. 3.13 When in force, these two additional pieces of legislation will add greatly to the onerous regulatory burden already on ports, and at a time when major changes are taking place in the structure of the regulatory bodies concerned. 3.14 This leads directly into the second reason why I believe the regulatory regime may become more onerous and complicated. In 2007 the Welsh Assembly Government established its own Marine Consents Unit (MCU) based in CardiV, which at some time in the future will process applications from Welsh ports under the provisions of the Marine Bill, including CPA and FEPA consents. 3.15 Moreover, prior to the transfer to CardiV, consents currently processed by the MFA in London will be transferred to Newcastle upon Tyne into the new Marine Management Organization (MMO) to be formed later this year. It would have been sensible if the transfer of these functions directly from London to CardiV had been arranged thus avoiding the short-term diversion to Newcastle. 3.16 Furthermore, historically there has been a high turn-over of MFA staV in London with responsibility for processing consent applications. The major administrative changes soon to take place will likely lead to a loss of those experienced staV due to their unwillingness to re-locate to Newcastle. 3.17 This will be at a time when applications for marine works consents throughout the UK is expected to be exceptionally high due to the additional demands resulting from the emerging oVshore wind farm industry. 3.18 Indeed there is anecdotal evidence that ports are already pre-empting a slowing down of application processing in anticipation that these changes will cause a log-jam and delays within an already ponderous system. 3.19 From a ports industry standpoint, it is important that due recognition is given by both the Westminster and the Welsh Assembly Governments to the impact this introduction of additional legislation coupled with the changes to the administration will have on the consents regime. Processed: 29-10-2009 23:00:05 Page Layout: COENEW [E] PPSysB Job: 435922 Unit: PAG7

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3.20 Whereas it is acknowledged there is now considerable pressure on the public purse, both governments should endeavour to make available suYcient time and resources and to ensure the transfer of responsibilities for marine consents is not detrimental to the ports industry. 3.21 It may be argued that the introduction of the Infrastructure Planning Commission (IPC) due to come into being later this year will help alleviate this situation, as it will have powers to determine all of the necessary consents required for marine works over a certain threshold, which in itself is a very welcome move insofar as it goes. 3.22 However, the IPC can only determine marine works applications for projects over a very high threshold, namely projects related to container terminals with a minimum throughput of 500,000 containers per annum, liquid and general cargo handling facilities with a minimum annual throughput of 5 million tonnes, or a power generation project exceeding 50 Mw for land based generation or 100 Mw for oVshore power generation. 3.23 With the possible exception of Milford Haven where high volume liquid cargo projects are possible, bulk/general cargo handling developments at Welsh ports are likely to be significantly below the threshold to qualify for determination by the IPC. 3.24 It therefore seems that the majority of Welsh ports will have to continue operating under the present cumbersome processing system in the hope the situation does not deteriorate while the administrative changes take place and the additional legislation is introduced. 3.25 In considering the regulatory restrictions and administrative burdens imposed on the UK’s ports relative to ports in Europe, which are generally state owned, it should be recognised that the majority of UK’s ports, including those in Wales, are now owned by foreign companies with considerable ports and shipping interests elsewhere. 3.26 Unless consents to develop and operate the UK’s ports are processed in a timely and eYcient manner, it is not unreasonable to expect that future investment will be redirected to those countries which are regarded as more understanding and accommodating towards the ports sector.

4. Port Development Opportunities 4.1 There is little disagreement of the importance of ports to local and regional economies. Historically ports have developed in support of local industries such as coal exports, steelmaking, agriculture and ferry terminals. In the case of the Port of Mostyn, these traditional businesses have all but disappeared, and its survival has only been possible by the decision a few years ago to diversify into construction and service base facilities for the oVshore renewable energy sector. 4.2 It is Government policy to erect 7,000 wind turbines oV the coast of the UK over the next 10 years. In order to achieve this target, considerable investment will have to be made in port infrastructure. 4.3 Success will only be achieved if it is recognised by both the port operators and Government bodies that this industry requires bespoke harbour infrastructure and very considerable areas of port land adjacent to quays. This will not happen if port development plans continue to be impeded by a fragmented and ponderous regulatory system.

5. Cruise Business Opportunities 5.1 Unlike some of its contemporaries, Mostyn has not heeded the siren promise that untold riches will come the way of the port operator who provides cruise lines with very expensive turn-around port passenger terminals. This lack of belief stems from the fact that Wales simply does not have the catchment area and mass of population to support turn-around cruise operations other than for the smallest ships, which are also small in number. 5.2 Furthermore, the costs of providing sophisticated baggage handling and security screening equipment together with experienced personnel for a few odd days business per season is proportionally prohibitive. Whereas turn-around calls may provide a little income to a few supporting service providers such as coach operators, this business is best left to the larger ports with established passenger terminals and good inland transport connections to attract suYcient passenger numbers. 5.3 I do believe however that there is a limited amount of business to be had from transit calls, always providing they can be accommodated using existing cargo berths and quayside facilities. Many of the cruise calls made at regional ports are “culture cruises” which originate from other UK ports such as Southampton, Tilbury or Harwich. 5.4 The majority of passengers who take this type of cruise are usually from the upper quartile of the age profile who do not like to travel by aircraft. Whereas this sector of the cruise market provides some revenue for the port (typically about £20k from a 1,000 passenger ship), very little of this filters through to the local economy. This is because most passengers will be whisked away from the ship by coach to the particular cultural location, (stately home/garden) and returned to the ship without visiting the port’s local town or city. Processed: 29-10-2009 23:00:05 Page Layout: COENEW [O] PPSysB Job: 435922 Unit: PAG7

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6. Container Handling Opportunities 6.1 Regarding the potential for container terminal development in Wales, the relatively low volume annual throughput of import and export container traYc is not suYcient to support a major investment in a Welsh port. Furthermore, the proposed new Panamax facility for Portbury (Bristol) and a similar project on the River Mersey will serve the future needs of businesses in both north and south Wales respectively. Trade routes, which are not served from either of these ports, can adequately be provided by feeder services from Southampton, Felixstowe or Continental ports into existing coastal vessel sized terminals. 6.2 Whereas this may mean additional inland transport costs for Welsh businesses, to some extent these costs would be oVset against the higher charges an under-utilised global shipping sized Welsh container terminal would need to charge to maintain viability. It is therefore unlikely that a large Welsh terminal to handle global container shipping would be commercially viable in the foreseeable future.

7. Policing and Security 7.1 I cannot comment on policing and security at other Welsh ports. However, the combined H.M. Customs and Revenue, Immigration and Port Security establishment at Mostyn works well and is not unduly intrusive into the Port’s business.

8. Recommendations 8.1 Welsh ports policies are reviewed and strengthened to give confidence to port operators considering investment proposals. 8.2 Measures are put in place to ensure the pending administrative changes and additional legislation does not result in the processing of consents becoming more onerous. 8.3 A review of the eVects the application of the Habitats and Birds Directives is having on port development to be carried out with the purpose of achieving a more equitable balance between the requirements of industry and conversation interests. 8.4 Government encouragement should be given to the development of small-scale container terminals. April 2009

Written evidence from Pembrokeshire County Council Pembrokeshire County Council is grateful for the invitation to submit evidence to the Welsh AVairs Select Committee in respect of its inquiry into Ports in Wales. The key points that we would wish to draw to the Committee’s attention are: 1. The UK Government response to the TENS review should recognise the importance of further upgrading road and rail access to service the Southern corridor link to Ireland via the Pembrokeshire Ports of Fishguard and Pembroke Dock. 2. There is a need and an opportunity to improve the strategic distributor road network linking major industrial sites and port infrastructure on the north and south banks of the Milford Haven Waterway. The Milford Haven Waterway hosts the UK’s largest energy hub comprising two oil refineries, an oil storage depot, two liquified gas terminals, a 2,000MW power station (under construction) and development land to host emerging wind, wave and tidal power developments, all with deep water access. 3. There are significant opportunities for further commercial and marine leisure development along the Milford Haven Waterway and at Fishguard, including new marina developments, increased use of these ports by cruise liners, port related activities linked to the Motorways of the Sea concept and service base facilities for emerging alternative energy developments. 4. Pembrokeshire County Council is concerned that there may be moves to privatise Milford Haven Port Authority (MHPA) which we consider would be of considerable disadvantage to local and regional stakeholders and the wider economy. 5. There is significant evidence that the local commercial property market requires public sector support to stimulate speculative investment. Enterprise Zone designations have been used successfully in the past to address the investment viability gap and should be used to help bring forward new port infrastructure and related property investment in Pembrokeshire.

1. Introduction 1.1 The County of Pembrokeshire is strategically located as part of the UK’s south western approaches with a long history of port and defence related activity, including the operation of a Royal Dockyard at Pembroke Dock during the 19th century and early 20th century. 1.2 Today the county hosts two port operations of international significance together with a number of small fishing and leisure harbours. Processed: 29-10-2009 23:00:05 Page Layout: COENEW [E] PPSysB Job: 435922 Unit: PAG7

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1.3 The larger port is the Trust port of Milford Haven comprising a variety of dedicated jetties servicing five oil and gas installations together with dock, dry dock and quayside facilities at Milford Haven and extensive quays, support facilities and an Irish Ferry terminal at Pembroke Dock. The commercial areas of the port extend over a distance of approximately 12kms. 1.4 The smaller port of Fishguard is owned by Stena and hosts their Irish Ferry Service which has a shorter sea crossing than the Pembroke Dock service and includes fast ferry services during the summer months.

2. Policy Framework 2.1 The recent Wales Freight Strategy (May 2008) which is part of the wider “Connecting the Nation” Wales Transport Strategy identifies the importance of enhancing international connectivity, improving infrastructure and better road and rail freight connections to main freight ports. 2.2 The South West Wales Regional Transport Plan will address identified transport problems for the period 2008–13 and the objectives include improving access to employment, business opportunities and tourism to encourage sustainable growth and to improve the eYciency, reliability and sustainability of the movement of freight within and beyond south west Wales. 2.3 The Community Plan for Pembrokeshire which is under review includes “improving communication links” and “delivering economic growth” as two of its priorities. 2.4 The Milford Haven Port Authority is appropriately designated as a Trust Port since the management of the Milford Haven Waterway goes beyond the management of navigation and port services to include a wider responsibility to key stake holders including and especially those aVected by its wide-ranging port operations. 2.5 The County Council has supported MHPA in its representations to the Department of Transport in respect of the Modernising Trust Ports—A Guide to Good Governance Consultation Document. The report describes a Trust Port as “a valuable asset presently safeguarded by the existing board, whose duty it is to hand it on in the same or better condition to succeeding generations. This remains the ultimate responsibility of the board and future generations remain the ultimate stakeholder”. The County Council acknowledges that the current port management embraces the good practice advocated in the consultation document. The Cabinet’s support for the MHPA included the proviso that “the Council requests that the reserved rights of Pembrokeshire County Council to nominate two Milford Haven Port Authority Board members should continue in the interests of local democratic accountability,and that the Department of Transport be advised of the County Council’s views about the inappropriateness of privatisation.” 2.6 The County Council currently has two nominated members on the MHPA Board and works closely with MHPA to maximise the potential of the Milford Haven Waterway as a commercial and leisure resource and an important environmental asset. The Milford Haven Waterway is a natural resource that bisects the county and which has had a profound influence on where and how towns and communities have developed in the county. 2.7 Over the last 20 years the Milford Haven Port Authority role has evolved from port operator to major developer and in recent years the Port Authority has become an important deliverer of economic and community regeneration projects linked to its waterfront land holdings. OYcers of the Port Authority are represented on many strategic public sector partnerships including the Community Planning Partnership, Spatial Plan partnership and regeneration master planning processes. 2.8 The Pembrokeshire Haven Spatial Plan, updated in 2008 by the Welsh Assembly Government, acknowledges the distinctiveness of the area as “a network of strong communities supported by a robust, sustainable, diverse economy underpinned by the Area’s unique environment, maritime access and internationally important energy and tourism opportunities”. One of the key strategic priorities of the Wales Spatial Plan is “overcoming the area’s peripherality by improving strategic transport links and economic infrastructure including improved telecommunication links and maximising the potential of the Area’s maritime assets and proximity to Ireland”. 2.9 The County Council has also worked closely with Stena as owners of Fishguard harbour to identify ways of improving port infrastructure and facilities. 2.10 In 2003 the Welsh Assembly Government and the County Council jointly produced a regeneration strategy for Fishguard which aimed to strengthen and diversify the local economy following the closure of a major employer in the town. Whilst most of the identified projects were successfully implemented and the unemployment rates reduced, the improvement of Fishguard Port and possible development of a quality marina, with all-tide access, remains a priority.

3. Contribution of Welsh Ports to the Economy 3.1 The Pembrokeshire ports have a disproportionate impact on the UK economy as a result of the importation, processing, storage and distribution of oil and gas which generate massive revenues to the UK Treasury through taxation and to a lesser extent business rates. Both ports are part of the strategic Trans European Road Network (TENs) connecting Ireland through the UK to mainland Europe. Milford Haven also has general cargo handling facilities for import and export and is the largest fishing port in Wales. Processed: 29-10-2009 23:00:05 Page Layout: COENEW [O] PPSysB Job: 435922 Unit: PAG7

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3.2 The impact on the local economy is also considerable. The MHPA employs over 200 staV and supports an extensive supply chain. The greatest impact however is from the establishment and operation of the energy companies around the Haven which collectively will employ approximately 1,000 permanent staV with a further 1,000 on-site contractors. Over £1 billion has been spent on recent LNG developments with an additional £1 billion on the new 2,000MW power station and other upgrades. It is estimated that collectively the energy companies inject £100 million per annum into the local economy through wages and the local supply chain. 3.3 There is significant potential for further growth across all port and marine related sectors if the necessary infrastructure improvements can be secured.

4. Increased Trade with Other Countries 4.1 The Milford Haven Port Authority is actively promoting the port for a range of uses including cruise liners, port related activities linked to the Motorways of the Sea concept and as a service base for emerging alternative energy development. There are significant opportunities for further commercial and marine leisure development along the Milford Haven Waterway and at Fishguard. 4.2 There is a shared concern by MHPA and Stena that the lack of a dual carriageway A40 link to the M4 is an impediment to future growth and this concern is exacerbated by the lack of clarity concerning how Strategic National Corridors and the TENS review will be taken forward in Wales.

5. Increase in Freight Movements and Adequacy of Transport Infrastructure 5.1 There is a strongly held feeling amongst local communities that developments which have been approved in Pembrokeshire “in the national interest” do not necessarily result in a long term legacy for the county. Specifically the county suVered during the 1980s and 1990s from major closures in the defence and energy sectors which resulted in male unemployment exceeding 30%, considerable dereliction and economic hardship that extended over nearly 20 years. Whilst Enterprise Zone status was granted in 1984–94 to stimulate investment around the Milford Haven Waterway, there has been minimal investment in improving the A40 west of Whitland (until recent months) and WAG refusal to support dualling. This approach contrasted greatly with dualling the whole length of the A55 to Holyhead and the acknowledgement of the catalytic impact, over time, of good communications on trade and economic growth in the locality. 5.2 The Port of Milford Haven comprises a mix of traditional dock facilities with commercial quays at Pembroke Dock and Milford Haven plus a range of specialised jetties to service Chevron, Murco and more recently the Dragon and South Hook LNG sites. 5.3 The main distributor highways servicing the extensive range of strategic waterside sites on the north and south banks of the Milford Haven Waterway are inadequate. The main access to South Hook LNG site and Murco Refinery is by way of a single track road with passing places. WAG has acknowledged the inadequacy of the access arrangements and funded initial design work to bring them up to standard. At the present time there is no confirmed funding to implement the scheme, though options are being explored. 5.4 The County Council has recently been able to negotiate a Section 106 contribution from RWE npower to enhance the Southern Distributor access route as part of the DECC Section 36 approval and discussions are taking place with the WAG to provide match funding to complete this project.

6. Tourism 6.1 The tourism potential of the ports are being developed in two ways, by attracting cruise liners and through waterfont regeneration activities including the development of new marinas. 6.2 MHPA and Stena have both been involved in encouraging and hosting cruise liners on the Milford Haven and at Fishguard. MHPA have seen year on year growth in the cruise market and have ambitious development proposals to improve facilities and to handle larger cruise liners. 6.3 Milford Haven is an exceptional marine leisure resource strategically located for oV-shore cruising, but with 24 miles of reasonably sheltered navigable waterway. There has been steady growth in the number of boats moored at marinas and swinging moorings and some expansion of support services. There is significant growth potential and a need for improved infrastructure to service this high value market. 6.4 Fishguard also oVers significant potential for further marine leisure development and is a strategically important “safe haven” for Cardigan Bay and the Southern Irish Sea. Planning consent has been granted for a 500 berth all tide marina which could be developed in tandem with port improvements. There is a concern that the public funding support required to underwrite some of the infrastructure costs is no longer ring-fenced within Welsh Assembly budgets as part of the agreed regeneration strategy for the town. 6.5 The Enterprise Zone designation in Milford Haven in 1984–94 was a catalyst for the regeneration of Milford Docks. Similar designation would greatly assist the viability of new port infrastructure and marina developments in the county and stimulate new investment and job creation. Processed: 29-10-2009 23:00:05 Page Layout: COENEW [E] PPSysB Job: 435922 Unit: PAG7

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7. Security and Policing 7.1 The County Council would urge the Committee to look very carefully at the response capability of the Dyfed Powys police given the recent expansion of the number of port related installations that may be regarded as critical national infrastructure. 7.2 The Committee may also wish to consider the wider impact of these installations on other emergency services including Fire and Ambulance services. June 2009

Written evidence from the Rail Freight Group Executive Summary 1. Rail Freight Group (RFG) is pleased to submit this evidence to the Welsh AVairs Select Committee inquiry into the Welsh Ports. This submission covers only those areas of the remit that come within RFG’s scope, specifically the role and development of inland links for freight from ports, forecasting of rail volumes, and the responsibilities for developing links from ports. We have commented on the General Policy Framework within which the inquiry is being undertaken and on recent studies of demand forecasting for rail freight. The current capacity and capability of existing rail links to the ports are summarised and there is a section on the funding of enhanced links and the extent to which contributions should be sought from developers. There is a short final section regarding the environmental impact of ports.

Introduction 2. Rail Freight Group (RFG) is the representative body for the UK rail freight industry. Our objective is to grow the volume of goods moved by rail freight in a cost eVective way. We work to influence Government and rail policy in support of rail freight and to help our members develop their rail freight services. 3. In submitting this evidence, RFG has restricted its comments to issues that impact on the movement of rail freight to and from the Welsh ports and those factors which aVect RFG members’ decision-making in respect of rail freight. We have not commented on other areas of the inquiry which are outwith our scope.

General Policy Framework 4. RFG notes that, unlike most other aspects of transport policy, ports’ policy for Wales is not devolved and remains the responsibility of the DfT. Continuing close co-operation and co-ordination between Department for Transport (DfT) and Welsh Assembly Government (WAG) is therefore essential to ensure that the latter’s policies regarding road and rail links between Welsh Ports and their hinterlands and markets, including those in England, are complementary to UK Port Policy. 5. RFG believes that a competitive, commercially led market place works most eVectively for rail freight and therefore does not favour models where Government specify the precise framework for port development across the UK. Patterns of international trade are unlikely to respect regional and local development plans if they do not fit easily with global distribution patterns and cost considerations. 6. RFG believes that Government should, however, set consistent and clear incentives and frameworks to deliver outcomes which are deemed to be in the national interest. In this context, it is hoped the National Policy Statements for Ports, and for National Networks, due to be published in summer 2009, will provide clarity on these issues.

Demand Forecasting 7. DfT developed and maintain forecasts for port traYc in the UK, and the impact on inland distribution. Generally, these forecasts are based around the current situation, where the South East ports tend to dominate. There is some consideration of scenarios with increases in transhipment, but little consideration of scenarios where ports in other areas increase in relative significance. 8. These forecasts have underpinned the development of rail freight forecasts used in the Network Rail planning framework and by DfT in their “Developing a Sustainable Transport System” strategy. As such, these work streams are also predicated on the continued dominance of the south east ports. 9. However, other ports are seeking to develop their capabilities—including Bristol, Liverpool and Tees. Such developments could generate a shift in distribution patterns to and around the UK. Developments at Bristol and Liverpool are likely to be of interest to Welsh ports if they succeed in attracting vessels towards the west coast of the UK. It is not for RFG to comment on the viability of such schemes, but should they progress, forecasts for inland distribution may need to be adjusted. Processed: 29-10-2009 23:00:05 Page Layout: COENEW [O] PPSysB Job: 435922 Unit: PAG7

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10. The forecasts are based on existing road and rail cost structures which are still broadly valid. A change in the assumptions (for example, assumptions about the level and form of road user charging) could make significant diVerences to the modal shares of road and rail. It is entirely possible that in such circumstances, rail may be able to compete more eVectively over shorter distances. The recent reduction in freight access charges should also result in rail gaining market share. 11. Development of Welsh ports for new and additional traYc could therefore generate additional rail traYc. Many of the Welsh ports including some of smaller facilities are already rail connected and some viable rail services could be developed. 12. The potential for developments to generate additional activities on the port estates can also increase demand for rail services. Changes in supply chain patterns, including the establishment of regional and national distribution centres at ports, are already occurring elsewhere in the UK. In addition, the role of Welsh ports in relation to traYc flows between Ireland, the UK and the rest of Europe is an area for development to which rail could contribute significantly.

Surface Access to Ports 13. Analysis undertaken by Network Rail during development of the Freight Route Utilisation Study (FRUS) clearly demonstrated that parts of the current rail network are not able to accommodate the expected level of growth emerging from the rail freight forecasts. However, no such issues were identified in respect of the main lines in Wales including those directly serving the principal Welsh ports and also those providing connections to/from adjacent areas of England. 14. Nevertheless upgrades of the network will be required if rail is to fulfil its potential role in the transport of goods to/from the Welsh ports. The Wales Route Utilisation Strategy (WRUS) published in November 2008, shows that while the North and South Wales main lines, plus the Marches Route from Newport to Chester and Crewe are capable of handling traYc loaded to the maximum axle weight, all these routes plus the vital connections from South Wales through the Severn Tunnel and to Gloucester have a restricted ‘loading gauge’ that would constrain rail movement of many of the larger containers now used in both deep-sea and short-sea shipping without the use of specialised wagons. 15. The FRUS indicates a long term aspiration to enhance the gauge capability of the lines from the Severn Tunnel and Gloucester to CardiV to accommodate the largest containers currently in use. Extension of this capability westwards to Port Talbot, Swansea or Milford Haven would become an aspiration in the event of a port development at any of these locations, as would provision of this capability along the North Wales main line if there were a major development at Holyhead. 16. However, the FRUS shows that no lines in Wales are included in the current priority schemes for gauge enhancement, and the more recent development of the Strategic Freight Network also seems entirely to by-pass Wales. 17. The recent review of the potential for electrification of the line from London through the Severn Tunnel to CardiV and Swansea would, if the scheme is viable, also provide a rail link with full loading gauge capability. Similarly, the putative HS3 serving Bristol and South Wales (via a second Severn rail crossing) could provide that opportunity (subject to such routes being capable of taking freight traYcataVordable charging levels). 18. In the event that neither of these schemes proceeds, the freight community would look to DfT and WAG to provide funding for gauge clearance in its own right. It is diYcult at present to determine whether DfT or WAG that should take the strategic overview of rail freight needs in supporting increased traYc to/ from Welsh ports, including where relevant, the need for enhanced capability.

Funding of Improved Links to Ports 19. DfT has recently published revised guidance on the funding of significant infrastructure. This perpetuates the policy of developer contribution, and sets out guidelines on assessing the distribution of benefits between parties. For ports, it indicates that generally the port developer should pay for developments on the inland links, as it is deemed to be the sole beneficiary. 20. While RFG would agree that there is a role for developer contributions towards the inland infrastructure, it does question whether this should extend to the strategic trunk network (road and rail) rather than being limited to the local or regional requirements which can be more closely linked to the specific growth from the facility. RFG would expect a developer contribution to upgrading a branch line and/or connection to a port, but questions whether they should be expected to fund upgrades of major routes, which could extend some considerable distance away from the facility itself. 21. The costs of rail enhancement schemes are significant and, if the port developer is expected to fund in full the capacity it will use, it is likely that the level of costs could become a barrier to the port investment itself. Care must be taken to balance the expected contributions against the need for developments to proceed and where such developments are expected to provide wider economic benefits to the region we would expect this to be taken into account. Processed: 29-10-2009 23:00:05 Page Layout: COENEW [E] PPSysB Job: 435922 Unit: PAG7

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22. There are several sources of Government funding which could be used to fund upgrades of the rail network. These include Transport Infrastructure Fund (TIF), and, to support traYc flows, the Sustainable Distribution Fund (SDF). Freight Facilities Grant (FFG) scheme is also available, with WAG administering the scheme in Wales. Whilst these are all welcome, they present a fragmented and sometimes transitory source of funding (for example, the SDF budget is not yet confirmed beyond 2010). In looking at infrastructure schemes with long development and construction timescales, a longer term view of funding is required. The links with any upgrades for passenger rail should also be considered to ensure maximum synergies.

Environmental Impact of Ports 23. Rail freight can make a significant contribution to reducing emissions generated by inland distribution from ports. For example, rail freight produces around 15 grams/tonne km of CO2; whilst the equivalent number for HGV is around 180 grams/tonne km (see DfT website http://www.dft.gov.uk/stellent/ groups/dft foi/documents/page/dft foi 612027.pdf ). Comparable data also shows rail freight to deliver far lower levels of other pollutants such as CO, NOx, and VOCs.

Conclusion 24. RFG believes that the current rail network in Wales does not present a barrier to development of ports in Wales, but that investment will be required to allow rail to play a full role in serving any increase in traYc through those ports. Capacity is not seen as an issue, neither is the ability to handle maximum axle-loads. However, significant investment in the provision of enhanced loading gauge capability may be required if the development of the ports is based around handling containerised traYcs. It is essential that the costs of enhancing the rail network do not bear on the developers to such an extent that the expansion of the ports becomes unviable. April 2009

Written evidence from the Road Haulage Association Ltd (RHA) Introduction 1. The RHA is the primary trade association representing the hire-or-reward sector of the UK road freight transport industry. The Association comprises some 9,000 member companies, operating between them 100,000! lorries and employing some 250,000 staV. Members range from single vehicle owner-drivers right through to multi-national fleet operators. A number of the member companies are either wholly or partly employed in the movement of goods through and from the ports in Wales, either by roll on/roll oV (ro-ro) access or container movements or bulk goods movements. As such the evidence below focuses on the interests of this type of professional road haulier. 2. It is in the interests of RHA members that the future direction taken by those controlling the port facilities is planned and organised in conjunction with the Welsh Assembly Government, the UK Government and relevant local authorities. Adequate and eVective land side infrastructure is essential.

Welsh Ports Inquiry 3. The RHA welcomes this inquiry into Welsh ports by the Welsh AVairs Select Committee following on from the Wales Freight Strategy published in May 2008. 4. However, as our specialism relates to road transport rather than port operations, we propose to limit our input to those areas which we believe are relevant to our member involvement with the ports and for which we have adequate specialist competency to do so. This memorandum is therefore largely focussed on land side infrastructure, port access and those issues relating to goods vehicle operators involved in port related activities.

Background to the Welsh Road Haulage Industry 5. The Welsh road haulage sector has an essential role to play in the Welsh economy as part of the overall logistics sector. Logistics contributes some £2.5 billion per year to the Welsh economy and accounts for 7% of employment in Wales with 61,000 people directly employed in logistics companies and a further 30,000 in logistics roles for other organisations. According to the Vehicle and Operator Services Agency (VOSA), there are 7,042 Goods Vehicle Operators’ Licences in place covering 20,216 registered goods vehicles.

The Demand for Port Growth 6. Forecasting the growth in demand for port capacity in Wales is an area in which this Association does not have any specialist knowledge. However, the DfT forecasts that by 2030, the final origin or destination of more than 40% of all goods being moved in the UK will be abroad with the great majority passing through Processed: 29-10-2009 23:00:05 Page Layout: COENEW [O] PPSysB Job: 435922 Unit: PAG7

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the UK’s ports. According to the CBI, some 10% of the UK’s trade currently transits through Welsh ports. Together with the environmental imperative, there can be no doubt that trade through Welsh ports will increase.

Short Sea Shipping 7. The European Commission and the UK government both support the increased use of short sea shipping to reduce movement by road of long distance cargo across Continents. However, in reality it is unlikely that the commercial sector in the Far East of the globe will increase its existing use of this mode if it leads to an increase in costs due to the additional handling delays. This is especially so since they have committed heavily through their own investment to deep sea vessels access at major domestic ports in the UK, the Netherlands and elsewhere. Although the emphasis across Europe is rightly on policies to reduce road transport it would be unrealistic to believe that developing countries will have the same mindset as us for a number of years to come. 8. Furthermore, with the increased ability of deep sea vessels to dock in our ports it is essential that serious thought be given to their desire to re-load commodities that they will expect to be waiting at the dockside for the return leg. Additional warehousing and storage will undoubtedly be added to all planning proposals up to and beyond 2030 if Wales is to attract more trade from the Far East.

What Hauliers Need from Ports 9. Assuming that a significant growth in trade through Welsh ports is a given, the road haulage industry and other freight distributors have a number of basic requirements: — Good access to and from the ports. Road haulage operators are governed by stringent regulations concerning drivers’ hours. Delays in getting to and from the ports can interfere with the hauliers’ delivery schedules and deadlines resulting in additional costs. For example, if replacement drivers are required as a result of running out of drivers’ time. —EYcient service within the ports. Any delays within ports must be kept to a minimum in order to ensure that additional costs are not incurred. If goods cannot eYciently be moved through the ports, consigners and consignees will seek alternatives. — High levels of security within ports. Hauliers’ loads are often of very high value and there are occasions when such loads have to be left in ports for considerable periods. A significant amount of port traYc is in the form of unaccompanied containers and trailers and the vigilance of port staV is imperative. This is especially so in light of the increasing number of illegal immigrants trying to gain entrance to the UK and the resulting fines that can be levied against the haulier. — Adequate enforcement to create a level playing field. According to the DfT, foreign registered HGVs are eight times more likely to be involved in a KSI accident than a UK registered vehicle, three times more likely to be unroadworthy than UK registered vehicles and their drivers are three times more likely to be in breach of drivers’ hours rules. A large percentage of lorries using the ports are foreign and it is important that VOSA are able to intercept all lorries either within or immediately adjacent to the ports. We seek fair and adequate enforcement for all lorries. — Adequate facilities for drivers. When sailings are delayed or there is congestion within ports, it is important that drivers have access to toilets and other basic facilities such as food.

Port Access 10. Continued expansion of existing port facilities in Wales presents diYculties when the goods that are landing must be shipped inland by road and rail at commercially acceptable rates and within customer- accepted timescales. Although we are predominantly concerned with road access, the basic requirements also apply to rail access. It appears to us that road access to ports is a considerable drawback in many cases. We do not intend to discuss access to all Welsh Ports but to highlight a number of concerns. Road access to Holyhead is very good along the A55 but the last mile into the port remains a bottleneck. Improvements to the A40 to Fishguard have been discussed for many years but it still remains a single carriageway road. These limitations do not in themselves deter hauliers from using these ports but they do have an impact on cost and the environment. In the longer term this may well result in a lack of competitiveness between ports. 11. It is essential that realistic and rational consultation is carried out with both local interests and national stakeholders with regard to how to address this situation. Although environmental considerations naturally will be a key priority for the decision makers in local and national authorities, the commercial/ economic consequences must also be given serious thought. The perception from industry is that those in power are uncomfortable with giving equal consideration to commercial needs when this may be seen as in opposition to environmental concerns, irrespective of the economic benefits to the surrounding area for commerce to grow. Processed: 29-10-2009 23:00:05 Page Layout: COENEW [E] PPSysB Job: 435922 Unit: PAG7

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Port Efficiency 12. Modern logistics requires up to date equipment and systems in order to achieve maximum eYciency. It is often the case that as port trade increases the port infrastructure becomes increasingly unable to cope with the demand. Port operators need to ensure they make the right investments in infrastructure such that they maintain high levels of eYciency. For example in Fishguard, there are limitations to the size and type of vessel able to use the port and consequently, the size and height of lorries able to use the port. Clearly, for the sake of the Welsh economy, such improvements could be greatly facilitated by use of grants. 13. Another matter that has been raised by members is that of non-port related activities being carried out on port land. Historically, port operators have let port land to businesses that are unrelated to the port activities and this land take-up precludes the expansion of port related activities.

Port Security 14. There are numerous new security regulations governing ports as a result of the terrorist threat. Our concerns are predominantly to do with the security of lorries, lorry loads and goods stored within ports. Lorries are often unable to access the port whilst waiting and are thus forced to remain outside the port in unsecure locations to the detriment of their security and the local environment.

Enforcement 15. We understand fully the natural reticence of port operators to allow enforcement activity to take place within ports or indeed immediately adjacent to ports. It is perceived that this could deter certain operators from using the port. We do not consider this to be a valid argument. Comments by the Chief Constable of North Wales that greater enforcement activity on the A55 would aVect the competitiveness of Holyhead with regard to foreign operators are not seen as helpful. Road safety is of the greatest importance and it is illogical that we should allow unroadworthy vehicles on our roads. Vehicle checks need to be carried out on the inward journey such that unroadworthy or overloaded lorries do not even gain access to our roads. Carrying out enforcement on the outward journey when lorries are about to leave Wales is illogical in that they will already have spent considerable time on the roads. We accept that the less scrupulous operators may be deterred from using Welsh ports if such enforcement is carried out but consider that it is a price worth paying to enhance road safety.

Drivers’Facilities 16. Our members advise us that in ports across Wales much of the existing dock side infrastructure is out of date and not “user friendly” in an age of heightened Health & Safety and employee awareness. Many of our members’ employees spend considerable time waiting within the ports and facilities, with regard to rest, food and hygiene requirements, are often not available or even considered. Professional vocational drivers, who are heavily regulated when carrying out a service to ensure the continuing success of the ports, should surely be treated with respect and adequate facilities made available to them as the norm, not the exception.

The Future 17. Improved transport infrastructure in the relevant areas would surely lead to increased demand for port facilities and in turn greater job creation and additional demand for port related facilities, such as storage units or manufacturing units. Funding would be required from national and local government, as well as the commercial sector. We do not believe that ports should be treated in any way diVerently from other commercial entities. It is not feasible for either the port operators or private investors in the ports to be expected to provide funding for the entire required infrastructure beyond their boundaries when all road users will benefit. Our belief is that supporting infrastructure around and close to the ports is not always given enough thought when expansion is being considered. Furthermore, the position of the ports inevitably puts pressure on existing and connecting road networks, often because alternative routes are not commercially or politically viable due to the conurbations that have built up in parallel to the increase in port activity. 18. Local authorities naturally focus their actions and their available budget on the area where the constituents they represent live. It is nonetheless essential that some degree of uniformity be seen across all potential re-generation and additions to the Welsh ports. The need for a Welsh strategic and integrated transport framework to inform and underpin regional and local transport decisions has never been stronger and is epitomised in the Wales Freight Strategy. 19. With so many parties involved from the outset it would surely be beneficial to have an overseer or body with expertise involved from the start rather than as a last resort when planning permission and road structure and improvements are being considered. There has been suggestion that local authorities set up municipal harbour management committee’s within existing Council structures, including external stakeholders with relevant expertise, much as Freight Quality Partnerships (FQPs) are utilised across England. This is certainly something that the Road Haulage Association would support. Processed: 29-10-2009 23:00:05 Page Layout: COENEW [O] PPSysB Job: 435922 Unit: PAG7

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Greater Welsh Assembly Government Involvement 20. We feel that the Welsh Assembly Government has a vital role in making sure planning and transport infrastructure issues are addressed to benefit the ports and the surrounding regions. As mentioned earlier, we believe that a mechanism must be provided which allows for commercial interests and the time taken in planning and consultation to be considered in a fair and reasonable way alongside the growing environmental demands. 21. However, our conclusions are that care must be taken to ensure that a national policy setting out how ports should develop is not an inhibiting factor to general development. Ports work in a dynamic and constantly changing international environment where each port has its unique characteristics. Any national policy we feel would place a brake on flexibility within this dynamic environment at the same time as not fully taking into account the individual traits of each port as a separate trading environment. 22. We hope that this inquiry will recommend that serious long term thought be given to the problems faced in Wales, in relation to acceptable movements to and from the ports. This must be wide ranging and open to all those with an interest in the relevant areas. May 2009

Written evidence from the Royal Society for the Protection of Birds Executive Summary (i) The RSPB is concerned that the themes set out for this inquiry, centring on opportunities for economic development, do not include consideration of the potential environmental impacts of ports. In the context of government commitments on sustainable development, we believe that it is unwise to make recommendations regarding economic opportunities in isolation from consideration of the environmental impacts. (ii) Many Welsh ports coincide spatially with areas that are designated under domestic or EU legislation for their wildlife importance. It is crucial that these designations are taken into consideration both at the strategic and local level. (iii) Over the last 10–15 years, major UK port developments have shown how it is possible to work constructively with the EU Birds and Habitats Directives to arrive at more sustainable solutions in the interests of wider society. Today, the UK port sector is an exemplar for the port sector in the rest of the EU in this respect. Welsh ports should strive to continue this record. (iv) In particular, the RSPB would suggest that a policy framework for Welsh ports may need to be subject to Strategic Environmental Assessment (SEA) under the EU SEA Directive, as well as strategic level appropriate assessment under the Habitats Directive. (v) It is also critical that the legislation is robustly applied at the local level, in particular the Habitats Regulations which apply to European Marine Sites (designated under the Habitats Directive and the Birds Directive). The tests in the Habitats Regulations provide a framework to facilitate more sustainable decision making. The RSPB believes there is a need for guidance and training for competent authorities to ensure that these Regulations are implemented properly, and the integrity of the Natura 2000 network is maintained.

Introduction 1. The RSPB is Europe’s largest wildlife charity with over one million members; over 50,000 of them live in Wales. We work to protect and enhance habitats for birds and other wildlife through land management on our reserves, provision of advice to land managers and through advocating environmentally beneficial policies to government. The RSPB works closely with ports and their regulators with the aim of ensuring any potential environmental damage from port related developments is minimised, and correct legal procedure is followed. 2. At a global scale if, despite the current global recession, trade volumes continue to increase in the long term, then there is a need to ensure that this occurs in the most environmentally benign way possible. This inevitably means an increased proportion of goods will need to be transported by ship. At a UK level, this will require action to cope with the consequences of increased trade and shipping. The RSPB considers ports and shipping to be a key part of an integrated transport policy. The challenge is making the right decisions about which combination of transport is the best environmentally. 3. Over the last 10–15 years, UK major port development has shown how it is possible to work constructively with the EU Birds and Habitats Directives to arrive at more sustainable solutions in the interests of wider society. Today, the UK port sector is an exemplar for the port sector in the rest of the EU in this respect and this responsibility has been recognised by the industry itself. “We work in some of the most sensitive coastal environments in the United Kingdom. Huge amounts of work and eVort are put into balancing the need to expand ports with protecting some of the most sensitive sites in Europe.” Processed: 29-10-2009 23:00:05 Page Layout: COENEW [E] PPSysB Job: 435922 Unit: PAG7

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Richard Everitt, Chairman of the UK Major Ports Group and Chief Executive of the Port of London Authority, 8 January 2008 (House of Commons Committee on Planning Bill)35 Welsh ports must strive to continue this record. 4. While the RSPB welcomes the opportunity to respond to this inquiry, we are concerned to note that the potential environmental impacts of port development have not been included as one of the key themes.

The Legal Framework for Protecting Biodiversity 5. Over 70% of the coastline and over 30% of the territorial waters (0–12 nautical miles) of Wales is designated for its biodiversity under domestic or European legislation. Inevitably, therefore, many Welsh ports are within, or overlap with, one or more designated sites. The main designations are: (i) Sites of Special Scientific Interest (SSSIs), protected in accordance with the Wildlife and Countryside Act 1981 (as amended)—many SSSIs include intertidal areas, but SSSIs are not generally designated below mean low water; (ii) Special Protection Areas (SPAs) designated pursuant to the Council Directive on the conservation of wild birds (79/409/EEC)—the 1979 Birds Directive; (iii) Special Areas of Conservation (SACs) designated pursuant to Council Directive on the Conservation of natural habitats and of wild fauna and flora (92/43/EEC)—the 1992 Habitats Directive; and (iv) The Marine and Coastal Access Bill, currently before Parliament, introduces a new designation—Marine Conservation Zones (MCZs)—oVering protection to nationally important marine wildlife. Some overlap between Welsh ports and MCZs is therefore likely in the future. 6. Port related developments can impact upon the habitats and species within these protected sites, for example by causing damage to or loss of habitats through works including dredging and construction. Habitats such as intertidal mudflats, of key importance for wading birds, and sub-tidal maerl beds which provide habitat for a variety of marine species can be impacted. 7. It is therefore critical that any policy framework for the development of Welsh ports gives full consideration to the need to protect biodiversity. Environmental assessment at the strategic level, as well as in relation to any individual proposals, is essential if the UK and Welsh Assembly Governments are to meet their obligations under European legislation, and their commitments to halt biodiversity loss by 2010 and reverse declines by 2026.36 Early consideration of potential environmental impacts, within the framework provided by the legislation, can also help to avoid drawn out and costly decision-making procedures. For example, Associated British Ports estimated that £45 million of capitalised costs were associated with the approval process for a deep-sea container port at Dibden Bay, Southampton, which was eventually refused by the UK Government after a lengthy public inquiry.37 8. All of the legislation mentioned above places specific requirements on public bodies and competent authorities in relation to the conservation and management of these designated sites. This evidence focuses on the 1994 Conservation (Natural Habitats &c.) Regulations (“the Habitats Regulations”), and in particular the process the Regulations provide for the assessment of proposals for development aVecting SACs and Special Protection Areas (SPAs).

Assessment of Plans or Projects Affecting SACsorSPAs 9. Under the Habitat Regulations, any development proposal likely to have a significant eVect on a SAC or SPA must be subject to an appropriate assessment of the implications for the site, in view of that site’s conservation objectives. 10. In the light of the conclusions of this appropriate assessment, the competent authority may agree to the project only after having ascertained that it will not adversely eVect the integrity of the site. In the light of a negative assessment, a damaging operation may only be able to proceed if it passes the following tests: (i) The competent authority is satisfied that there are no alternative solutions—the RSPB argues that the assessment of alternative solutions must include consideration of whether similar objectives could be achieved with less damage to protected habitats and species, by first making the best use of existing port capacity before considering the need for new capacity, which could be at a completely diVerent location within Wales or the rest of the UK. (ii) If there are no alternative solutions the project can only be carried out for imperative reasons of overriding public interest (IROPI). It is important to bear in mind that, given the international level of the European designations, the imperative reasons must be at a commensurate level of importance.

35 Public Bill Committee, Planning Bill, 8 January 2008, q62 36 Wales Environment Strategy 2006 37 http://www.abports.co.uk/news20042259.htm Processed: 29-10-2009 23:00:05 Page Layout: COENEW [O] PPSysB Job: 435922 Unit: PAG7

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(iii) Even if the plan were to pass all of the above tests, it can only go ahead if the necessary compensatory measures are secured to ensure that the overall coherence of Natura 2000 network of internationally important sites is protected.

Implementation of the Habitats Regulations in Wales 11. Although a large proportion of Wales’ inshore waters is designated under the EU Directives, there is evidence that the protected wildlife within these sites is under pressure. A 2006 report by Countryside Council for Wales (CCW) estimated that roughly 60% of the features within Wales’ marine SACs and SPAs are in unfavourable conservation status, due to insuYcient control over damaging human activities.38 12. Wales Environment Link, a coalition of environmental NGOs in Wales of which the RSPB is a member, commissioned a report to look into the eVectiveness of Wales’ European Marine Sites (EMSs— SACs and SPAs with an intertidal or subtidal element) in protecting nationally important marine biodiversity. The report includes two case studies of port-related developments within the Pembrokeshire Marine SAC, which involved a number of competent authorities, and where it appears that the Habitats Regulations were not properly applied. As a result, foreseeable damage has occurred to some of the protected features of the SAC (and associated nationally important biodiversity), but no provisions for compensatory measures have been made. 13. Both the report commissioned by Wales Environment Link and the aforementioned CCW report identified a number of weaknesses in the current management of marine SACs and SPAs (collectively referred to as European Marine Sites, EMSs). Two of these appear to be particularly relevant to ports and related developments: (i) Multiple consents in the marine environment. Many developments, including port-related developments—can require consents and permissions from a number of competent authorities, which are applied for and assessed separately in relation to their likely impact on EMS features. This can make it very diYcult for the cumulative impact of all elements of a development on EMS features to be assessed in a timely way. Furthermore, if the initial stages of a major project are assessed in isolation, and consented because they are not considered to have a significant impact on a site, pressure can build for subsequent stages, considered later, to be consented even though they may cause a significant impact; and (ii) Lack of understanding of the requirements of the Habitats Regulations within Competent Authorities. The case studies undertaken for the Wales Environment Link-commissioned report highlighted a number of instances where it appeared that the Regulations had not been correctly applied by the competent authorities concerned. CCW’s report suggests that frequent staV changes and internal reorganisations within competent authorities can hinder eVorts to embed the Habitats Regulations in their day-to-day work. In addition, for some competent authorities the requirements of the Habitats Regulations are perceived to be in conflict with their primary remit or core work—this is thought to be an issue in particular where the competent authority is responsible for consenting plans and projects that support its own work, as is often the case for port authorities. 14. Both the CCW report mentioned above, and the report commissioned by Wales Environment Link, recommend that, in order to assure more eVective management of European Marine Sites, which meets the requirements of the Habitats Regulations, WAG should provide guidance and training for competent authorities. This guidance should provide mechanisms to deal with projects which require multiple consents from diVerent competent authorities. The RSPB hopes that the opportunity arising from new provisions for marine planning and licensing, coming forward through the Marine and Coastal Access Bill, will be capitalised upon in this regard.

Strategic Assessment of Environmental Impacts 15. The RSPB would contend that any policy framework or strategy relating to further development of Welsh ports should be subject to Strategic Environmental Assessment (in accordance with European Directive 2001/42/EC, “the SEA Directive”). Any strategy proposing specific locations for developments likely to have a significant eVect on a Natura 2000 site must be subject to a strategic level appropriate assessment, in accordance with the Habitats Directive. It is essential that biodiversity is taken into account early in the process of planning for ports and related developments.

Conclusion 16. If sustainable development is to be achieved, it is vitally important that designated sites are properly protected. The framework provided by the legislation, in particular the SEA Directive and the Habitats Regulations, is essential to ensure biodiversity is properly taken into account in decision-making. Assessment of potential environmental impacts must be a key part of developing a policy framework for Welsh ports.

38 Dernie, K M, Ramsey, K, Jones, R E, Wyn, G, Hill, A S, Hamer, J P Implementing the ecosystem approach in Wales: current status of the maritime environment and recommendations for management, CCW Policy Research Report No 06/09 Processed: 29-10-2009 23:00:05 Page Layout: COENEW [E] PPSysB Job: 435922 Unit: PAG7

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17. In order to ensure that the Habitats Regulations are correctly applied so that European Marine Sites can be eVectively managed, the RSPB believes the UK Government and the Welsh Assembly Government should provide clear guidance and training to all competent authorities. June 2009

Written evidence from the Royal Yachting Association Introduction 1. The RYA is the national body for all forms of recreational and competitive boating. It represents dinghy and yacht racing, motor and sail cruising, RIBs and sportsboats, powerboat racing, windsurfing, inland cruising and personal watercraft. The RYA manages the British sailing team and Great Britain was the top sailing nation at the 2000, 2004 and 2008 Olympic Games. 2. The RYA is recognised by all government oYces as being the negotiating body for the activities it represents. The RYA currently has over 100,000 personal members, the majority of whom choose to go afloat for purely recreational non-competitive pleasure on coastal and inland waters. There are an estimated further 500,000 boat owners nationally who are members of over 1,500 RYA aYliated clubs and class associations. 3. The RYA also sets and maintains an international standard for recreational boat training through a network of over 2,200 RYA Recognised Training Centres in 20 countries. On average, approximately 160,000 people per year complete RYA training courses. RYA training courses form the basis for the small craft training of lifeboat crews, police oYcers and the Royal Navy and are also adopted as a template for training in many other countries throughout the world. 4. There are approximately 84 sailing or boating clubs and associations and over 25,000 participants in the sport in Wales. 5. The RYA invites the Committee to consider the following submission.

Executive Summary 6. The recreational boating sector is a valuable and significant contributor to both the social and economic pillars of sustainable development and is an integral part of the development of tourism. This is emphasised in the Welsh Assembly Government’s recent Coastal Tourism Strategy (2008). 7. Recreational boating is an important facilitator to achieve the Welsh Assembly Government’s stated objective of “an active, healthy and inclusive Wales, where sport and physical activity provide a common platform for participation . . . which binds communities and the nation.” 8. Welsh boating contributes significantly to the UK’s direct leisure marine industry turnover of £3 billion and 35,000 jobs. Ports are a major economic driver in coastal regions and policies should be in place to protect their infrastructure and enable future development, particularly where declining or moribund commercial activity oVers opportunities for the creation or expansion of recreational boating facilities. 9. Port authorities should be encouraged to develop master plans with all stakeholders, widely defined, involved in the planning process to ensure proper management of potentially conflicting interests.

General Comments 10. The RYA supports the examination of: (a) the policy framework for the development of Welsh ports, including co-operation and co- ordination between the UK Government and the Welsh Assembly Government; (b) the contribution of Welsh ports to their local economies, including: (i) The potential to increase the scale and range of trade with other countries; (ii) The potential to increase freight movements through Welsh ports and the adequacy of the transport infrastructure linking ports to their hinterlands and markets, including those outside Wales; (iii) The development of tourism and the potential for attracting cruise ships to Welsh ports; and (c) the adequacy of security and policing provision at Welsh ports. 11. However, while the terms of reference of the inquiry rightly focus on the strategic framework for the sustainable development of ports in the Wales, against the background of wider central and devolved Government objectives, and understandably they focus mainly on goods and passenger transport issues, the RYA considers that the social and economic significance of the leisure and recreational use of ports should also be included. Processed: 29-10-2009 23:00:05 Page Layout: COENEW [O] PPSysB Job: 435922 Unit: PAG7

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12. Although considerable recreational boating activity takes place on our inland lakes, reservoirs, canals and rivers, by far the greatest activity is on tidal waters and it is estimated that 90% of all such activity takes place, originates or terminates in a coastal harbour.

Social Agenda 13. Recreational boating is an ideal vehicle for delivering central and devolved Governments’ social and health agendas. The Welsh Assembly Government’s sport and physical activity strategy,“Climbing Higher”, was launched in 2005 and is supported by the Sports Council for Wales’ “Framework for the Development of Sport and Physical Activity”. The Welsh Assembly Government’s overall objective of the strategy is stated to be to achieve “An active, healthy and inclusive Wales, where sport and physical activity provide a common platform for participation, fun and achievement, which binds communities and the nation and where the outstanding environment of Wales is used sustainably to enhance confidence in ourselves and our place in the world” and one of the stated means by which this is to be achieved is by “Investing in the development and maintenance of more and better facilities for sustainable outdoor and adventure activities in order to encourage participation, develop sporting success and attract visitors.” 14. The strategy also sets out several targets for sport and physical activity to achieve over the next 20 years and these include: Target 6 40% of adults will be members of sports clubs or centres. Target 7 80% of children will be junior members of sports clubs or centres. Target 8 All public sector employees and three-quarters of all other employees will have access to sport and physical activity facilities, at or within a 10-minute walk of the workplace. 15. We consider that the achievement of these targets could be supported by the sustainable development of port and harbour facilities to accommodate and facilitate recreational boating activities. The Welsh Assembly Government’s 2008 Coastal Tourism Strategy recognises the opportunities for this type of development and this is also reflected in the Wales Spatial Plan.

Economic Benefits 16. Recreational use of ports also brings considerable economic benefits. The EU Green Paper “Towards a future Maritime Policy for the Union” states the importance of maintaining the position of Europe as “the” global maritime superpower, with its pre-eminence in the shipping and yachting industries. It is no exaggeration to claim the same status for the UK as “the” yachting superpower within Europe. Although yacht building is now mainly centred in other European states, in all others areas of design, component supply, service and manning, the UK is the European leader. 17. It is estimated that, within the UK as a whole, recreational boating generates a direct turnover of £3.1 billion and supports 35,200 full time equivalent jobs [British Marine Federation 2008]. Independent studies indicate that the spend from a cruising yacht making an overnight stop at a “yacht friendly” harbour town will generate an average £40 per crew spend [Isle of Wight Tourist Board], and that the creation of a new marina will generate one new job locally for every 20 berths that are filled by “resident” yachts [The Yacht Harbour Association]. With its wide range of attractive yachting and boating facilities, the Welsh recreational boating sector is a substantial contributor to these statistics.

Facilities Development 18. Relatively recent marina developments at such places as CardiV, Conwy, Holyhead, Swansea and Pwllheli show clearly the importance of boating facilities as a catalyst for urban regeneration in Wales. The economic benefits of developing recreational boating facilities are reflected in the Welsh Assembly Government’s 2004 “Catching the Wave” watersports tourism strategy. 19. Most Welsh ports have significant leisure use and in many smaller ports leisure boating is the primary or even the sole use. There should therefore be Government policy recognition of the importance of this in economic and social terms. There is a particular risk in large commercial ports, where the financial importance of commercial traYc could lead to their ignoring or putting at risk the needs of leisure boating. Further if boating is to respond to the Government’s social agenda and the Welsh Assembly Government’s targets, ports need to include the growing infrastructure—moorings, slipways, and other facilities—in their future plans. 20. The development of leisure facilities is unlikely to have any downside in employment or economic terms in the area or the Welsh economy generally. Nor do we consider that the development of leisure facilities is likely to decrease demand elsewhere. There is considerable unsatisfied demand, particularly for low to medium cost moorings and facilities, in most parts of the country. Also, experience shows that a development in one part of an area adds to the attraction of keeping a boat elsewhere in the area, as a greater variety of local cruising destinations become available. 21. By definition, port activity is a major economic driver in coastal regions and with so many pressures on coastal land, there should be policies in place protecting the infrastructure of ports to enable future recreational development to take place. Thus for example, the RYA strongly opposes the infilling of Processed: 29-10-2009 23:00:05 Page Layout: COENEW [E] PPSysB Job: 435922 Unit: PAG7

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redundant ports for development land, or changes of use to boatyards and quaysides, where each such development represents the permanent loss of an important boating facility for present or future use. In addition, residents in new waterside developments often then seek to close down maritime activities on land and water which they see as a nuisance. Planning policies should seek to preserve actual or potential leisure boating facilities; and require restrictive covenants on any waterside development to prevent purchasers from objecting to current or future maritime activities. 22. The RYA considers that ports should be recommended to develop master plans for future development. Many ports, particularly in the municipal sector, are subject to a number of conflicting interests, with a multiplicity of riparian local and county councils, and conflicting leisure and commercial interests. One agreed and published master plan document may help in providing a consistent approach to addressing planning and management conflicts. However to achieve this, it is essential that all stakeholders, widely defined, have the opportunity to be involved in the planning process. An attempt by port or local authorities to exclude them would only be a recipe for greater conflict. 23. The potential of small, moribund ports as potential centres for leisure activity has been well demonstrated in a number of harbour towns in Wales (eg Caernarfon and Bangor in Gwynedd) and there are numerous examples of Government intervention elsewhere in the UK and on mainland Europe resulting in a new lease of life being given to otherwise run down and forgotten ports. As ports close and industry moves away from an area, equal or even better opportunities are created for the imaginative use of redundant facilities, where necessary supported by a mix of local volunteers (usually through the local yacht club), commercial, and public sector input. 24. All ports, however small, are part of the basic national infrastructure and should be viewed as such. It is true that for many small ports, economic and social circumstances may have changed radically since the port was originally built but the investment put into the port originally should not be lightly thrown away. Potentially every small port in Wales is capable of development to provide better facilities for the recreational sector. Doing this is an important way of providing the additional facilities needed for boating to contribute to central and devolved Governments’ social agenda, the Welsh Assembly Government’s “One Wales” strategy and the Sports Council for Wales’ development framework. Small ports often also have a role to play in meeting wider leisure boating needs as harbours of refuge.

Port Management 25. Board members of municipal ports (and potentially members of any consultative or advisory committee) are subject to the onerous DCLG Code of Conduct for Local Authority Members. In the RYA’s view, the Code of Conduct severely limits the ability of a municipal port to involve in a management or supervisory role any individual who has direct experience as a stakeholder of the port and the RYA believes that this is a significant limitation to the eVectiveness of the port’s management. The RYA would therefore encourage adoption of a more pragmatic approach to conflicts of interest. 26. The RYA would be happy to provide additional evidence if that would be of assistance to the Committee. April 2009

Written evidence from Saga Shipping Company In 2008, Saga Cruises have made calls at Welsh ports with our three ships (Saga Rose, Saga Ruby and Spirit of Adventure):

Saga Rose (535 passengers): 6 June 2008 Holyhead 8 June 2008 Pembroke

Saga Ruby (636 passengers): 7 June 2008 CardiV

Spirit of Adventure: (341 passengers): 10 June 2008 Pembroke 11 June 2008 CardiV

No calls are planned to Wales in 2009. On our ships over 95% of our passengers are from the UK, where our brands are strong and established. Our product is tailor-made for certain sectors of the UK market—it has appeal to that restricted market Processed: 29-10-2009 23:00:05 Page Layout: COENEW [O] PPSysB Job: 435922 Unit: PAG7

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segment which sees advantages in not just touring on land. A cruise oVers a fresh port each day, without packing and unpacking, to enter some glorious harbours from the sea, to obtain an exhilarating opportunity to get a new vista and perspective on towns that one may have visited from the land side. Our Celtic ports cruises focus on how the Irish Sea was a “super highway” of the past—linking together better than roads the Welsh, Irish and Scottish ports community. For foreign guests to the UK this is potentially a strong market. A number of German cruise lines do venture into the ports of the South West of England and could be tempted to come further north. More importantly, we suspect that with the relatively strong US $ clever PR/marketing directed at North American agents would be a real advantage for Celtic ports. Our small contingent of American passengers on our Celtic cruises has been quite delighted with the product. For North Americans, the shared heritage and the fact that Pembroke was a major emigration departure port for their ancestors is a strong theme to market. We are also building a close relationship with a French tour operator and although they see Scotland as a stronger marketing proposition, they do have an interest in marketing the “Celtic basin”. The Ryder Cup being in Wales presents some particular 2010 opportunities. We make a positive impact on the ports we visit. On an average port call Saga Ruby passengers would spend in the region of £30,000 on shore excursions. Saga still benefits from the traditional engineering skills of South Wales. We use several significant South Wales contractors, notably Harris Pye. Last year we had a major refit on Spirit of Adventure—in excess of £8 million with major improvements to the ship, including work to enhance her environmental credentials and to facilitate the use of Zodiacs from the rear deck. The work was carried out in Malta Dry Dock—although in fact more was spent with Welsh-based companies than was spent with Malta Shipyard. We would like to support Welsh engineering based companies more and bring our smaller ship to Wales for dry docking. This would mean many millions more for the local economy. However, to use this currently redundant facility we would require a financial incentive to be the first cruise operator in a long while to have their ship dry docked in Wales. The proposed increase in UK light dues will add extra cost to cruise operators planning to call to UK ports in the future especially when compared with calling to ports on the near continent where these charges are not levied on vessel owners. Port costs in the UK are already some of the highest in the world and this increase in UK light dues does not help attract cruise vessels to our shores. Our calls to Wales in 2008 were generally very well received by passengers. However, if more cruise vessels are to be attracted to CardiV and Swansea, more needs to be done to reduce port costs. CardiV tug fees are at least four times more expensive than any other UK port we visit and at least six times the most expensive European port we use. CardiV’s very high tug prices make a call there extraordinarily expensive. We enclose with this presentation copies of our brochures for the ships and our shore excursions.39 Please note the eVect that must arise from promoting the hinterland of ports by creating or sustaining local employment for tour guides, bus companies, entry fees for important monuments and buildings. Our intention is that each visitor to a Welsh port will become an ambassador for future cruisers and other inbound tourists to Wales—and will return. July 2009

Written evidence from South West Wales Integrated Transport Consortium (SWWITCH) Executive Summary South West Wales ports have key roles in freight, passenger transport, tourism, employment and economic development. To support and develop these roles there are a number of key requirements and opportunities: — improvements to road and rail infrastructure serving the ports; — encouraging and developing freight, passenger services and cruise ship use of the ports; — increasing opportunities for leisure and tourism related development and activities; and — maintaining existing and developing new business to sustain and encourage local businesses and suppliers.

Background The South West Wales Integrated Transport Consortium (SWWITCH) was set up in 1998 and comprises the four South West Wales authorities of: — Carmarthenshire County Council; — Neath Port Talbot County Borough Council;

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— Pembrokeshire County Council; and — The City and County of Swansea. The SWWITCH area of interest includes all forms of transport and wider issues including land use planning and access, sustainability and carbon reductions, behavioural change and the health agenda. SWWITCH is one of four transport consortia across Wales supported by the Welsh Assembly Government and operates through a number of specific tiers: — Joint Committee—this meets quarterly and comprises up to three elected Members from each Council along with a range of stakeholders including transport providers, users group representatives and economic/business group representation — Management Group—this meets monthly and comprises the Chief OYcers with responsibility for Highways and Transportation in all four Councils along with the SWWITCH Co—ordinator and the transport strategy/policy oYcers from each Council —OYcer Working Group—this meets weekly and comprises the transport strategy/policy oYcers from each Council with SWWITCH OYcers — Sub groups which meet as and when required include: — Education Transport Group — Community Rail Partnership Group — Walking and Cycling Group

Introduction SWWITCH is pleased to be able to respond to the Welsh AVairs Select Committee inquiry into Ports in Wales. Ports make a significant contribution to the local and regional economies in terms of employment and training, support for secondary businesses, supplies of raw and manufactured materials and the visitor and tourism markets. However, beyond purely regional concerns the ports in South West Wales contribute to the Welsh and UK economies as a whole, particularly with respect to vital energy supplies. The ports and regional road and rail infrastructure are a vital “land bridge” between Ireland, the UK and mainland Europe and this is recognised in the Trans European Network (TENs) designation of most of the main South West Wales Ports and the road and rail routes which serve them. The UK Government response to the TENS review should recognise the SWWITCH priorities in terms of improving infrastructure to serve our ports and support long term sustainable growth. The main ports in the area are all in private (commercial) ownership and are as follows: — Port Talbot—strategically important in terms of the import of iron ore and other cargo; — Swansea—general cargo and until recently passenger ferry services to Cork in Ireland. There are plans to restart the ferry service; — Milford Haven—This is the largest UK energy port and is critical to the security of future energy supplies. It is also the largest fishing port in Wales. There are passenger ferry services from Pembroke Dock to Ireland; and — Fishguard—Stena Line provide RoRo (Roll on Roll OV) links to Rosslare in Ireland for freight and car/foot passengers. There are a number of smaller ports in the region which are not included in this response to ensure it remains focused and short, but these ports are nonetheless important locally and regionally for small freight, fishing, water sports and passenger movements. SWWITCH is charged by the Welsh Assembly Government with preparing and delivering a Regional Transport Plan (RTP) for South West Wales. This plan will provide strategies and policies for improving transport and access over the next 20–25 years as well as a five year programme of projects to help deliver the strategy. After an extensive consultation process, SWWITCH is preparing to submit the RTP at the end of September 2009. The RTP vision, objectives, relevant policies and projects which are appropriate to this inquiry are attached as Appendix A to this response. It should be noted that the RTP is still subject to final political approval and so the excerpts in Appendix A are final drafts. Specific issues relating to each port are covered in more detail below and in the appendices, and common features and concerns are highlighted in the summary section.

Port Talbot This is owned and operated by Associated British Ports (ABP) and has rail links to the mainline. It comprises Port Talbot Deep Water Harbour (capable of accepting vessels up to 170,000 dwt) and smaller docks for more general cargo use. There is a significant area of land available for port related development. The main traYc through Port Talbot at present is coal and iron ore associated with the Corus plant at Port Talbot. Processed: 29-10-2009 23:00:05 Page Layout: COENEW [O] PPSysB Job: 435922 Unit: PAG7

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The key issues for Port Talbot are: — Retention of current usage—in the face of declining heavy industry and the shift from rail to road based transportation of raw material and products for further manufacturing; — Expansion and diversification—to ensure a vibrant, sustainable future, there is a need to consider new markets; and — Road access to and from the port—It is important for Port Talbot docks to have appropriate highway links to ensure reliable and timely movement of port traYc and also to avoid concerns of local communities aVected by freight traYc. The current access arrangement to Port Talbot Docks is not satisfactory and Neath Port Talbot County Borough Council has developed the first stages of the Port Talbot Peripheral Distributor Road (PDR) with support from the Welsh Assembly Government’s Transport Grant. The most vital part of the PDR—stage 2—which will eVectively provide a reliable bypass for freight and other port traYc, avoiding local communities, has been included in a forward programme for Transport Grant. SWWITCH has urged the Welsh Assembly Government to ensure that actual construction of the PDR stage 2 begins early in the 2010–11 financial year.

Swansea This port is owned and operated by ABP and has rail links to the mainline. It has the capacity to handle vessels up to 30,000 dwt as well as a wide variety of vessels and cargo. It has a passenger terminal for ferry services and has approved facilities for cruise vessels. There has been extensive diversification over the last decade with the support of the former Welsh Development Agency and the Welsh Assembly Government. This has seen much redundant land used to create a maritime quarter and the SA1 area of mixed accommodation, oYce, leisure and high technology use. Key issues for Swansea port are summarised below and set out in detail in Appendix B: — Importance of the docklands regeneration at SA1 and further opportunities to support economic development activities at the port; — Trading links opportunities—Inter trading and Port activity—helping SME’s (suppliers) to build their capacity to secure work locally from public and private sector organisations and ultimately to compete in the global market place; — Inter-trading and Ireland—The Swansea to Cork Ferry has previously benefited businesses on both sides of the Irish Sea, providing a conduit for both goods and customers. The future resumption of the service provides an additional opportunity to extend international trade and plans are currently being discussed to host such an event in Cork later this year to promote this; — Tourism—Tourism is expected to benefit significantly in future from the realisation of a number of planned initiatives centred on the port in Swansea. These will restore transport links between Swansea and Cork and will promote additional cruise ship activity. In addition, new passenger services from Swansea to North Devon are intended to commence during 2010; — Export/import markets—Port Facilities. There have been several enquiries from overseas companies in recent years seeking a distribution point for their goods prior to making a decision on relocating and investing in the UK. Many of these enquiries pointed to the potential of the port being used as a hub for goods arriving at the dockside but also from other ports courtesy of the EWS rail links; and — Road access to the port—The A483 Fabian Way approach to Swansea ports from the M4 motorway is due to be “trunked” by the Welsh Assembly Government. This would mean that improvements to and the maintenance of the road would become the responsibility of the Assembly.SWWITCH urges the Assembly to proceed to “Trunk” the road as it provides a strategic artery to the port and the potential economic development which the port can stimulate.

Milford Haven The port is a Trust Port operated by the Milford Haven Port Authority which employs more than 200 staV. It is a natural deep water harbour which is connected to mainline rail and the major pipeline network. Milford Haven is the largest port in Wales and hosts the UK’s largest energy hub with two oil refineries, an oil storage depot, two liquefied gas terminals and a 2,000MW power station currently under construction. The Port also includes the Irish Ferry terminal at Pembroke Dock. Key issues for Milford Haven are as follows: — there is a need and an opportunity to improve the strategic distributor road network linking major industrial sites and port infrastructure on the north and south banks of the Milford Haven Waterway; — more strategically in terms of the Trunk Road infrastructure, the inadequacy of the current single carriageway sections of the A40 are of concern to long term plans to build on the economies of scale which are developing at the port; Processed: 29-10-2009 23:00:05 Page Layout: COENEW [E] PPSysB Job: 435922 Unit: PAG7

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— there are significant opportunities for further commercial and marine leisure development along the Milford Haven Waterway and at Fishguard, including new marina developments, growing use of these ports by Cruise liners, port related activities linked to the Motorways of the Sea concept and service base facilities for emerging alternative energy developments; — there are concerns that port developments which have taken place over many decades, in the “national” interest, have failed to take full account of local interests and needs ; — there are concerns that there may be moves to privatise the Milford Haven Port Authority which SWWITCH considers would be of considerable disadvantage to local stakeholders, community engagement, and the wider economy; — there is significant evidence that the Pembrokeshire local commercial property market requires public sector support to stimulate speculative investment. Enterprise Zone designations have been used successfully in the past to address the investment viability gap and could be used to help bring forward port infrastructure and related property investment; and — the UK Government response to the TENS review should recognise the importance of upgrading road and rail access to service the Southern corridor link to Ireland, via the Pembrokeshire ports of Fishguard and Pembroke Dock.

Fishguard Harbour The port is operated by Stena Line and provides freight links and passenger services, with the bulk of traYc related to regular ferry services to Rosslare in southern Ireland. Planning consent has been given for a 500 berth all tide marina which could be developed in tandem with port developments. Key issues relate to: — taking advantage of opportunities for tourism and marine leisure related developments and activities; — the importance of road and rail access improvements being included in the UK Government’s response to the TENS review (see Milford Haven 7th bullet point), including: — improvements to passenger rail services to Fishguard (currently only two return journeys a day and at less than convenient timing); and — improvements to the A40 (see second Milford Haven bullet point). Key issues for Milford Haven and Fishguard are set out at Ev 117 which is a detailed response prepared by Pembrokeshire County Council.

Summary The ports in South West Wales make a significant contribution to the local regional, national and European economies and also to accessibility to and from the region, in particular with the strong links to Southern Ireland. The use of ports in the region has, and continues, to develop over time and SWWITCH wishes to ensure that opportunities to secure more trade, to diversify and to encourage inward investment through the use and development of port facilities are maximised. Whilst each port has specific issues, common themes are evident and these are summarised below: South West Wales ports have key roles in freight, passenger transport, tourism, employment and economic development. To support and develop these roles there are a number of key requirements and opportunities: — improvements to road and rail infrastructure serving the ports. Improved rail links could help to improve the overall sustainability of port related traYc and relieve aVected local communities of high levels of road freight traYc. Improved road links will help to ensure more reliable and competitive freight traYc and a more eYcient and attractive travel opportunity for passengers. Road improvements will also help to remove port related vehicles from inappropriate local roads; — encouraging and developing freight, passenger services and cruise ship use of the ports; — increasing opportunities for leisure and tourism related development and activities. To support local and regional economies and bring into productive use under utilised or derelict land that could not be otherwise used for primary freight or passenger port uses and that are not likely tp be required for future port activity; and — maintaining existing and developing new business to sustain and encourage local businesses and suppliers. A number of SMEs rely on the successful operation of the ports. It is critical that economic opportunities are maximized related to ongoing port activities and the movement of people and commodities through the ports in South West Wales. Processed: 29-10-2009 23:00:05 Page Layout: COENEW [O] PPSysB Job: 435922 Unit: PAG7

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APPENDIX A RELEVANT EXCERPTS FROM THE REGIONAL TRANSPORT PLAN (RTP) FOR SOUTH WEST WALES The RTP Vision Our vision for South West Wales is to improve transport and access within and beyond the region to facilitate economic development and the development and use of more sustainable and healthier modes of transport.

RTP Objectives 1. To improve access for all to a wide range of services and facilities including employment and business, education and training, health care, tourism and leisure activities. 2. To improve the sustainability of transport by improving the range and quality of, and awareness about, transport options, including those which improve health and well being. 3. To improve the eYciency and reliability of the movement of people and freight within and beyond South West Wales to support the regional economy. 4. To improve integration between policies, service provision and modes of transport in South West Wales. 5. To implement measures which make a positive contribution to improving air quality and reducing the adverse impact of transport on health and climate change, including reducing carbon emissions. 6. To implement measures which help to reduce the negative impact of transport across the region on the natural and built environment including biodiversity. 7. To improve road safety and personal security in South West Wales.

RTP Long Term Strategy — Improving land use and transportation planning—through the use of Accessibility Planning to ensure that development is put in the right place. — Improving strategic east/west road and rail links– to create more reliable internal connectivity and improved connectivity with rest of Wales, the UK and European neighbours. — Improving Strategic Bus Corridors—to create more reliable and attractive connectivity between key settlements. — Promoting integration—to encourage more sustainable travel choices and reduce the barriers to interchange. — Improving safety in transport—to reduce personal injuries and fears for personal safety. — Providing more and better information— to raise awareness on the range and use of sustainable transport options. — Improving linkages between key settlements and strategic employment sites—to create a range of attractive passenger transport and walking and cycling opportunities linking key settlements with their hinterlands and with strategic employment sites. — Improving the eYciency of the highway network—through a range of appropriate mechanisms including demand restraint.

RTP Policies Reducing Greenhouse gas emissions and other environmental impacts from transport — Policy E1—SWWITCH will work collaboratively to ensure that new development is located where it will reduce reliance on private motoring. For existing land allocations the emphasis will be on securing realistic alternatives to single car occupancy as part of the development process. — Policy E2—SWWITCH will facilitate and promote improved rail and bus services, walking, cycling and car sharing to encourage modal shift and improve air quality — Policy E3—SWWITCH will work collaboratively with a wide range of organizations in South West Wales to encourage take up and development of travel planning to reduce single occupancy car commuting — Policy E4—SWWITCH will work collaboratively to encourage more sustainable freight distribution through better use of rail, intermodal facilities and ports. Processed: 29-10-2009 23:00:05 Page Layout: COENEW [E] PPSysB Job: 435922 Unit: PAG7

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Integrating local transport — Policy IT1—SWWITCH will develop improved interchange facilities, including Park and Ride schemes, to reduce the barriers to multi modal journeys.

— Policy IT2—SWWITCH will work collaboratively to encourage the development and take up of smartcards and other multi modal ticketing opportunities.

— Policy IT3—SWWITCH will develop user friendly sustainable travel information to support multi modal journeys.

— Policy IT4—SWWITCH will facilitate joined up working between agencies and organisations that provide transport to reduce barriers to more sustainable travel behaviour.

— Policy IT5—SWWITCH will work with agencies and organisations that provide transport to reduce barriers including those which prevent people with impairments from using public transport.

— Policy IT6—SWWITCH will develop a range of transport options to meet the access needs of those living in areas with no appropriate public transport.

— Policy IT7—SWWITCH will integrate Strategic and Local Transport networks to promote sustainable access to the coast and countryside for tourists and residents.

Improving access between key settlements and sites — Policy KS1—SWWITCH will develop improved public transport services, including unconventional and innovative forms of public transport, to link key settlements and their hinterlands with strategic corridors and strategic and local employment sites.

— Policy KS2—SWWITCH will improve the journey time reliability on and safety of the road network between key settlements and from them to strategic and local employment sites.

— Policy KS3—SWWITCH will improve walking and cycling links within and between key settlements, including the development of Safe Routes in the Community.

— Policy KS4—SWWITCH will promote sustainable transport options to reduce car dependency for local journeys and improve local air quality.

Enhancing International Connectivity — Policy IC1—SWWITCH will work with the Welsh Assembly Government through the National Transport Plan programme to improve the Trunk Road Network to facilitate journey time reliability and support the regional economy.

— Policy IC2—SWWITCH will press for improvements to the rail network in and beyond South West Wales into Sewta and TraCC to encourage more inward investment and support modal shift for passengers and freight.

— Policy IC3—SWWITCH will work collaboratively to facilitate more reliable, eVective and sustainable movement of people and freight to, from and through our ports.

— Policy IC4—SWWITCH will work with the Welsh Assembly Government, Sewta and TraCC to support the development of good access to regional and national airports in the UK, especially by public transport.

Increasing Safety and security — Policy SS1—SWWITCH will seek to reduce the number of road casualties and collisions through improved traYc management.

— Policy SS2—SWWITCH will work collaboratively to promote safe behaviour by all road and rail users.

— Policy SS3—SWWITCH will encourage and facilitate more use of public transport, walking and cycling to increase footfall in our local communities and reduce anti social behaviour. Processed: 29-10-2009 23:00:05 Page Layout: COENEW [O] PPSysB Job: 435922 Unit: PAG7

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RTP Trunk Road and Rail Priorities

Rail Priorities

Description Detail Priority Improvements to Rail — Redoubling the line west of Swansea to secure improved 1 Services West of Swansea services to West Wales including: — 3 trains per hour between Swansea, Gowerton, Llanelli and Carmarthen. — Hourly services from Carmarthen to Milford Haven. — 5 trains per day to Fishguard Harbour. Improving Rail Services to — Reducing the journey times to CardiV, London and 2 CardiV, Bristol and London beyond. — Improving access to and facilities at mainline stations drawing on all sources including National Station Improvement Programme funds and EU Convergence funding Improving the access to and — Five trains per day on the Heart Of Wales Line (HOWL). 3 use of rail services — Improving the Swanline service. — Developing new stations where justified and reviewing the long term role of smaller stations. — Maintenance and development of the South West Wales Community Rail Partnership

Trunk Road Priorities

Description Detail Priority Trunk Road Commitments — A40 Penblewin to Slebech. 1 — A40 The Kell. — A477 St Clears to Red Roses. — A40 Llandewi Velfrey to Penblewin. — A483 Llandeilo bypass M4 and Trunk Road priority — M4 junction improvements to reduce congestion and 2 measures improve connectivity. — Consideration of Park and Share sites near to M4 junctions. — Signalisation of Pensarn roundabout in Carmarthen. — A48 at Cross Hands improvements. — Trunking of: — A4138—between M4 and Llanelli. — A483—Fabian Way corridor. A40 improvements — Improvements to the A40 west of St Clears including 3 dualling if the business case is proven. — Access from the A40 to the proposed Carmarthen west link road. Trunking and De-Trunking — Trunking of: 4 — A485/6—Carmarthen to Synod Inn. — A476 between Cross Hands and Ffairfach accompanied by a subsequent de-trunking of the A483 from Pont Abraham through Ammanford to Ffairfach/Llandeilo. — De-Trunking of: — A40 Salutation Square to Withybush Roundabout.

RTP Freight Component Strategy

Freight Strategy 2010–15 Freight transport plays an essential role in the economy, in terms of delivering raw materials, manufactured goods, food and refuse. SWWITCH prepared a Freight Strategy in 2002, with updated forecasts in 2006. Processed: 29-10-2009 23:00:05 Page Layout: COENEW [E] PPSysB Job: 435922 Unit: PAG7

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The prime factor in delivering this Component Strategy is partnership working with the private sector and appropriate grant interventions from Government. The strategy seeks to achieve where appropriate and practicable: — The more eVective and eYcient movement of freight. — The use of more sustainable modes for the movement of freight. — A reduction in the distances over which freight is moved. The Strategy recognises that currently over 90% of land surface freight movements within or starting and ending in the region are by road and that the movement of freight is driven primarily by highly competitive commercial pressures in the private sector. Large amounts of freight are also conveyed by sea and pipeline. Therefore the strategy recognises that for the foreseeable future the vast majority of regional land surface freight trips will be by road unless there are suYcient Government grant incentives to divert appropriate flows to rail, pipeline or coastal shipping. Delivering the Wales Freight Strategy—The basis of all regional Freight Strategies in Wales is the Wales Freight Strategy (WFS), which seeks to: — assist Regional Transport Consortia in the development of RTPs; — identify and promote factors supporting sustainable transport distribution systems; — support Welsh industry and commerce with a reliable and cost eYcient network for raw materials, manufactured and consumer goods; — anticipate and respond to fundamental changes in the supply-chain and markets; — identify weaknesses and constraints in the existing freight network which may impact on the Welsh economy; and — integrate and maximise use of the existing freight infrastructure, using all transport modes to the benefit of the environment and the economy. Supporting the Regional Economy—SWWITCH will work collaboratively with WAG, the freight industry, Network Rail and others to: — Ensure that the needs of the freight industry in the region and in Wales are taken into account in making decisions about rail infrastructure and train path allocation. — Identify, promote and develop a consistent strategic network of regional signed lorry routes that include local links to local centres of activity such as town centres, ports, other inter-modal freight interchanges, retail and industrial parks and sites. — Provide parking for road freight transport (locations, facilities required and pricing). — Consider specific parking for drivers’ rest areas. Developing Sustainable Freight Transport—SWWITCH will seek to make best use of the region’s existing assets, including its ports at Port Talbot, Swansea, Fishguard Harbour and the Milford Haven Waterway, the trunk road network and a rail network with spare capacity particularly in the west of the region. As opportunities present themselves, SWWITCH will: — Seek to mitigate the adverse eVects of road freight vehicles on communities and the environment generally by implementing appropriate traYc management measures to deal with intrusive HGV movements. — Seek to identify pilot freight consolidation centre(s) to serve and enhance the urban environment. — Encourage appropriate stakeholder partnerships including local and sub-regional Freight Quality Partnerships (FQPs) to mitigate and deal with identifiable issues of concern to local communities and the freight industry. — Increase the carrying capacity of the railway as cost eVectively as possible when developing local schemes, which have a potential impact on freight transport. — Identify potential options for road-rail freight facilities. — Ensure that land-use policies seek opportunities for promoting rail freight facilities and that potential sites are protected, particularly for road-rail interchanges. — Promote use of coastal shipping wherever practicable. — Promote added-value activities at ports, identifying environmental benefits. — Identify port locations where new facilities could be developed, including in particular potential multi-modal and port-based inter-modal sites. — Consider the capacity and availability of the rail network in relation to port-related rail freight. Processed: 29-10-2009 23:00:05 Page Layout: COENEW [O] PPSysB Job: 435922 Unit: PAG7

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APPENDIX B DETAILED ISSUES RELATING TO SWANSEA PORT 1. Importance of the docklands regeneration at SA1 and links with the City Centre, and opportunities to support economic development activities on the significant areas of vacant employment land at the port The SA1 Waterfront Project demonstrates the following: — Potential of a redundant dock basin (Prince of Wales Dock) to provide a focus for a comprehensive mixed use regeneration scheme embracing oYce development/housing/leisure/community based facilities. The central feature of the scheme is the dock basin which covers an area of 27 acres and which will provide an opportunity to introduce a 400 berth marina (adding to the established marina facilities in the Maritime Quarter and the Tawe River basin). — Feasibility of implementing a comprehensive and prestigious regeneration scheme in proximity to an operational dock (Kings Dock). This requires a degree of sensitivity in terms of dockside development so as to avoid the introduction of incompatible uses. — The value of having a redundant dockland in close proximity to the city centre. This allows for integrated and sustainable development and raises the economic viability of the regeneration project. Anticipated outputs include: — 40 ha land reclaimed — 3,000! jobs — 2,000! residential units (including aVordable units) — 65,000 sqm business space — 2 hotels — Health centres/community church There are significant other areas of vacant land in the vicinity of the remaining operational dock. The prudent approach here is to ensure that enough operational land to service any further developments directly related to the dock function is retained and to allocate any balance of land for general employment use. There is an area of some 26 ha located between the Kings Dock and Queens Dock. This area is connected by rail and there would appear to be potential for enhancing the container function of the port in this location. An area of some 26 ha to the east of Queens Dock could on the other hand be used for general employment. There is a need to maximise the potential of the dock/rail interchange

2. Trading links opportunities Inter-trading and Port Activity Swansea has worked with SME’s (suppliers) helping to build their capacity to secure work locally from public and private sector organisations and ultimately to compete in the global market place. The Port facility provides an additional focus for this sort of activity on two fronts: 1. The Ferry link with the City and County of Cork, (Swansea has a formal twinning arrangement with Cork City Council) and the trading advantages oVered by the similarities in culture and structures. 2. The facilities at the port itself and the potential for a transport and distribution “hub” for Swansea and the rest of South west Wales.

Inter-trading and Ireland The Swansea–Cork Ferry has previously benefited businesses on both sides of the Irish Sea, providing a conduit for both goods and customers to and from each region. Previously the City and County of Swansea along with Cork City and Cork County Councils organised inter-trading events involving their respective SMEs with the ferry service providing a logistical back drop to the whole venture. Tourist operators have also long recognised the benefits that the ferry link created. The future resumption of the service provides an additional opportunity to re-present international trade between Ireland and Wales and plans are currently being discussed to host such an event in Cork later this year to do this. Processed: 29-10-2009 23:00:05 Page Layout: COENEW [E] PPSysB Job: 435922 Unit: PAG7

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3. Tourism Tourism may benefit significantly in future from the realisation of a number of planned initiatives centred around the port in Swansea, which will restore/create transport links between Swansea, Cork and North Devon and promote additional cruise ship activity: — Swansea–Cork Ferry—A Cork tourism co-operative has secured funding and an “agreement to purchase” from a Finnish bank a vessel which will be used to restore the Swansea Cork Ferry service. The £9 million 340 cabin ferry will be capable of carrying 1,400 passengers, and launch of the service is estimated for 1 March 2010. The previous service was terminated in 2006 with an estimated loss to the Swansea economy of over £800,000 per annum. — North Devon Ferry—Developer Mariners Trading Ltd intends to commence passenger ferry operations from March 2010, with services planned to operate between Swansea, Ilfracombe and Minehead (with other linked services involving Penarth/CardiV and possibly Burnham-on-Sea). Two “Fast Cat” ships 40 metres in length, accommodating up to 360 foot passengers will be acquired to operate the services. Passage between Swansea and Ilfracombe would take approximately 50 minutes, and between Swansea and Minehead approximately 1hour and 5 minutes. — Celtic Wave—A joint European funding bid to support a Cruise marketing campaign on behalf of the port areas of Anglesey (Holyhead), Pembrokeshire (Milford Haven), Swansea, Cork, Waterford and Dublin has been approved. The project will further develop the cruise ship industry across all the above named ports in the Irish Sea. It will create a single managed brand for the Irish Sea cruise ground, raise the profile of the Irish Sea as a cruise ship destination and create a consistent welcome for cruise passengers who visit the Irish Sea cruising grounds.

4. Export/import markets Port Facilities There have been several enquiries from overseas companies in recent years seeking a distribution point for their goods prior to making a decision on relocating and investing in the UK. Many of these enquiries pointed to the potential of the port being used as a hub for goods arriving at the dockside but also from other ports courtesy of the EWS rail links. At the moment there is one bonded warehouse situated on Swansea dock that is used primarily to stock steel products. The advantage of a bonded warehouse scheme being extended to other products and sectors means that importers would only pay the duty on their goods once they had left for delivery to customers. ABP in recent times presented a strategy outlining such a scheme for their own development of the facilities in Swansea. The practicalities and feasibility of such schemes require further consideration, but the potential to develop economic activity using the natural resource and primary purpose of Swansea docks should be maximised.

Written evidence from Stena Line Ports Ltd We are responding to the invitation from The Welsh AVairs Committee to submit evidence and information to assist them in their inquiry into the following subjects: The policy framework for the development of Welsh ports, including co-operation and co-ordination between the UK Government and the Welsh Assembly Government. — The contribution of Welsh ports to their local economies, including: — the potential to increase the scale and range of trade with other countries; and — the potential to increase freight movements through Welsh ports and the adequacy of the transport infrastructure linking ports to their hinterlands and markets, including those outside Wales; — The development of tourism and the potential for attracting cruise ships to Welsh ports; — The adequacy of security and policing provision at Welsh ports. For clarification we wish to advise that this letter comes to you from The Port of Holyhead which is itself owned by Stena Line Ports Limited a subsidiary of Stena AB, based in Sweden. Stena AB also owns ships and operates some 18 important ferry routes for freight and passengers throughout Northern Europe specifically on the Irish Sea, the North Sea and around Scandinavia and these include: — Stranraer to Belfast; — Fleetwood to Larne; — Holyhead to Dun Laoghaire and Dublin; — Fishguard to Rosslare; and — Harwich to Hook of Holland. Processed: 29-10-2009 23:00:05 Page Layout: COENEW [O] PPSysB Job: 435922 Unit: PAG7

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Stena Line, as well as providing ferry services, are also terminal managers and operators on most of their routes. In addition to Holyhead, Stena Line Ports Limited are the statutory port authority in Stranraer and Fishguard.

1. The Contribution of Welsh Ports to the Local Economy The passenger ferry industry is a vital component of the UK transport infrastructure. It comprises of three main sectors. They are: UK-Continent routes, UK-Republic of Ireland routes and domestic routes. The UK passenger ferry market involves significant numbers: 39.6 million passengers and 8.6 million cars were carried across all services during 2008. The 12 UK-Ireland services collectively account for 12–13% of ferry passengers, cars and coaches of the UK ferry market. At the end of 2008 63 ships operated on UK-Continent and Ireland routes with a capacity 72,800 passengers and on domestic routes 79 smaller ships with a capacity of 28,500 passengers. In 2008, the UK passenger ferry industry employed approximately 17,700 staV directly. Of these, around 10,200 were seafaring staV. Freight is a vital component for most ferry operators and this market has seen a large decline in carryings since June 2008. UK ports are estimated to support 360,000 jobs, including direct, indirect and induced impacts. Ports therefore have impacts which go far beyond their immediate cargo and passenger handling roles. To take one employment example, port operations in Holyhead account for a significant proportion of the estimated 19,000 jobs available on Anglesey. Of the estimated 4,500 jobs located in Holyhead itself, the Stena Line operation is responsible for direct employment of over 25% of the local work force eg port staV, ships staV, border agency staV etc with an even larger number of indirect employment impacts created elsewhere on Anglesey eg coach drivers, food suppliers etc. At Fishguard the Stena Line operation is responsible for direct employment of over 249 of the local work force, making it the largest private employer in North Pembrokeshire. This is at a time when the number of Jobseeker Allowance claimants in Preseli Pembrokeshire has risen by more than 107% in the last 12 months. Stena Line has also recently announced its intention to consider a number of potential re-development options for the Port of Fishguard. The options being considered by Stena Line include the upgrade of the existing single tier, single width ramp to a more modern double tier ramp, or the construction of another modern berth and ramp at another location in the Harbour coinciding with reclamation that would create additional standage for any future new services that Stena, or another operator may introduce to the port. The Port of Fishguard is also earmarked for a Marina Development which is supported by The Crown Estate and the Welsh Assembly Government and Pembrokeshire County Council. Such large scale Port developments will greatly assist tourism, further support the local economy and help importantly reinforce the route as a strategic gateway to Ireland?

2. The Adequacy of the Transport Infrastructure Ports form an important part of the supply chain for many UK importers and exporters and although not always easy to measure it is essential that due consideration needs to be given to the time criticality of such supply chains. In England, Strategic National Corridors (SNC’s) have been clearly identified, these take into account the major influence ports have on traYc flows, and reflect the contents of the recently published Eddington report. This report highlighted the value of good and reliable links to UK ports. On reading the report it becomes apparent that SNCs trail oV at the Welsh border. It is vital that these links, especially through North and South Wales connecting to the rest of the UK and subsequently to Ireland and the Continent are clearly identified and are recognised for their strategic value and are fully funded. On a more local level Holyhead Port are the recipients of many complaints from the users of the A55 expressway. It would appear that the 100 mile or so section of strategic highway which leads from the North West of England through to Holyhead is always subject to extensive road repair traYc delays. These delays whilst unavoidable could in our opinion be much better co-ordinated throughout the whole length of the route so as to minimize the disruption caused.A strategic highway should be treated as such and due consideration should be given by the various authorities concerned to the full eVects of disruption along its entire length. Given that the A55 expressway is a busy TEN-T route Holyhead Port would like to put on record its concerns regarding the inadequacy of freight specific lay up stops ( Truck Stops). As far as we are aware no such facility exists within easy reach of Holyhead Port. Freight drivers, being subject to strict driver hour limitations, are at this time forced to find alternative sites to park up to rest and such sites may not always be popular with local councils. A very similar problem exists at Fishguard Port. We would ask Government to support any initiatives that seek to address this problem. Processed: 29-10-2009 23:00:05 Page Layout: COENEW [E] PPSysB Job: 435922 Unit: PAG7

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The provision of suitable road linkages to Ports are also of concern to both Holyhead and Fishguard Ports. At Holyhead Port the A55 expressway stops some distance from the Port check-in facilities. This missing port link although workable results in an excessive traYc build up on the local road network as well as causing significant delays to freight and tourist traYc arriving at and leaving from the Port. The A40 starts at Fishguard Port, joining the M4 corridor 43 miles later, west of Carmarthen. The concerns here are more basic than those of the A55 expressway which has undoubtedly brought economic benefits to the region. The A40 is a single carriage road for 35 miles, with only one 2 lane section east bound for overtaking and none west bound. The journey, with no disruption, takes 50 minutes. Even though the A40/M4 is the economic artery running through South Wales connecting us to Southern Ireland and the South of England it is not even recognised as a TEN-T route, a lack of recognition that greatly concerns us.

3. The Adequacy of Security and Policing Provision at Welsh Ports There are two main areas of concern:

(a) The proposal to abolish the Common Travel Area between UK and Eire These proposals primarily aVect the three Ports in Wales, where a large volume of passenger and freight traYc is carried on direct services to the Irish Republic. The original proposals called for fixed immigration controls, and for all passengers and all vehicles to be stopped, to ensure that they were all carrying approved identification. On 15 January 2009, Central Government issued its response to the consultation process, on the same day that they published their Borders, Citizen and Immigration Bill. At face value, it would appear that Government listened to the concerns of industry, and removed the proposals for fixed immigration controls on all passengers at all Irish Sea Ports. Government at this stage indicated that the following measures would be put in place on direct Irish Sea Services: — every passenger to carry a passport or ID Card; — risk based intelligence led immigration controls, at Irish Sea Ports, Channel Islands/Isle of Man and Irish Land Boundary; — £2,000 fine to ferry operators (carrier’s liability) for every passenger travelling without a passport or ID Card; and — E Borders to be imposed. Strong concern about the Bill’s impact has been expressed in recent debates in the House of Lords and elsewhere, to the extent that the CTA proposals were removed as a result of a vote in the Lords in April. We have also recently been advised by the European Commission that the application of the e-borders scheme to intra-EU travel (ie all ferry services) has no basis in European Law, that the scheme contravenes the Data Protection Directive, and that requiring passport data to be provided in advance of travel is incompatible with the right of free movement within the EU. We fully expect that CTA discussion will reappear in the Commons soon, but this removal shows the strength of feeling and also the view that current CTA arrangements do not pose a significant security threat to the UK. All ports in Wales will comply with the Port Security Regulations and will shortly have to comply with the EU Security Directive which will be implemented through new Regulations later this year. We believe that security and policing at Welsh ports is already very strong. Provision of even more onerous border controls should always be mindful of a fair balance between providing eYcient and cost eVective security regimes and most importantly does not hinder the eYcient movement of freight and passengers. It might be helpful at this point to understand Holyhead Ports existing provision in relation to Border Checks:

Special Branch Police Unit Approx 60 members of staV North Wales Police OYcers UK Border Agency OYcers Approx 20 members of staV Formally HM Customs oYcers, supported on an ad-hoc basis by other visiting UKBA “hit squads”. Port Security OYcers Approx 40 members of staV Required to ensure the Port Authority complies The Ship and Port Facility (Security) Regulations 2004–05—These oYcers are paid for by Port, in 2009 the security staV costs amount to some £750,000 a not so insignificant sum. From the above summary 120 people are already involved in “securing the border” at the Port. This number I’m sure the committee will agree is not insignificant. Processed: 29-10-2009 23:00:05 Page Layout: COENEW [O] PPSysB Job: 435922 Unit: PAG7

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We would consider it is essential that a proper assessment of Border Control is conducted to establish if the existing controls are adequate and proportionate; and in addition, that it should be conducted together with port operators and carriers. The evidence presented so far is not convincing. We believe there would be significant damage to the UK/Wales/Ireland travel industry since a lot of tourist travel remains quite local to the port areas and make quick decisions to travel, not necessarily planned in advance. There is no doubt that day trip travel is heavily dependant on there not being a hassle factor to contend with. Ferry travellers are likely to have a higher incidence of not owning passports ie older more rural customers and family units. From our perspective this has the potential to be hugely detrimental to our business— purchasing passports could add significantly to the cost of travel for many people. We do not see how border controls in the CTA, designed to capture illegal’s and associated criminal activity as already declared by government, can be properly eVected without putting in place international style borders and all the associated facilities/equipment. None of the CTA borders at UK ferry ports have such installations. So it means that there would have to be a complete redesign of port infrastructure and many simply do not have the available space to do that without spilling out onto the public highway. There is insuYcient information at present to determine what costs there might be but the sums will no doubt be significant and no doubt government agencies will expect Port Authorities to pay. We cannot aVordtodo so without taking drastic actions to recover costs.

(b) The E-borders initiative This plan has been in the pipeline for years and the real impact on the ferry industry is still unclear. Changes to ferry operators software reservations systems given their complex nature are always time consuming and expensive. No ferry operator has made any adaptation to its systems or processes due to the uncertainties regarding the implementation of the E-borders scheme. Carrier’s reservation systems software (if they have them because not all carriers do) will need a major re-design in order to capture passenger and vehicle data not done today. The last and recent system design change eVected by Stena Line cost in the region of £18 million. (As an international EU operator it is not just a local change needed but a major re-design.)

4. The Development of Tourism Given the huge impact of the economic and financial crisis on business and consumer confidence, there has been a significant knock-on eVect on travel and tourism. Travel patterns have changed: late booking is the norm, taking a “staycation” is the new “vacation”, the number of individual short breaks will be reduced in favour of taking one main holiday and value for money has never been more important. With demand for travel being elastic, travel and destination marketing to boost tourism is vital. Whilst credit crunch fears prompt many consumers to choose to holiday in the UK, which has the potential to greatly benefit Wales, the decline in sterling’s value against the Euro has for the first time in many years made Britain an aVordable destination for the Irish. Just under 0.9 million trips were taken to Wales by overseas tourists in 2007. With the most popular origins of overseas visitors being the Republic of Ireland, USA, France and Germany. Ireland is repeatedly the top country of origin for overseas visits to Wales (197,000 visits in 2007). (Source: WAG website) Stena Line has been reinforcing the “Better value Britain” campaign message in the ROI market via a multi-media marketing campaign, emphasising that Britain “has never been more aVordable” and with the Euro going further for consumers when they get there. This message, coupled with great value travel deals is a key focus for marketing in a tough economic climate. Stena Line is proactively encouraging travel to Wales with a number of products created to encourage car touring, day trip travel, self-catering holidays, hotel breaks, theme parks, activity and event based breaks. We have recognised that to encourage travel we need to be in the market, with clear and easy to understand oVers encouraging a destination sell or reason to travel and we need to be there consistently. However the marketing of these products could be far more eVective with greater collaboration with Visit Wales and the regional tourism partnerships. The importance of tourist board/carrier collaboration will only be of benefit to the tourism agenda of Wales. Visit Wales is responsible for the marketing of Wales as a tourist destination both nationally and overseas, but it appears that in 2009 the marketing strategy has focused primarily on the domestic UK market. In January of this year a three month national advertising campaign (due to be extended), which formed part of a £2.2 million investment was launched. The campaign creative and messaging is one that provides breakthrough, resonates with the consumer and provides instant recognition. The “holidays unpackaged” theme lends itself well to the idea of car touring holidays and one which Stena Line is an ideal partner. However, it is disappointing that the opportunity to launch a clearly defined and coherent diVerentiation strategy with this campaign overseas was not undertaken. Processed: 29-10-2009 23:00:05 Page Layout: COENEW [E] PPSysB Job: 435922 Unit: PAG7

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Stena Line is always keen to participate in joint partnership marketing campaigns and to date this year has invested in campaigns with Tourism Ireland, Visit England, Visit Scotland and BVCB to promote the destination, the ease of getting to there with great value travel and accommodation deals. The only tourist board we have not been able to partner with has been Visit Wales who will not undertake joint overseas partnership campaigns with carriers until the autumn. Nearly three quarters of all holiday trips to Wales occur between April and September, with July and August being the most visited period. The delay in undertaking an overseas promotional campaign will result in a lost opportunity to help secure the critical peak tourist season for carriers, accommodation providers, attractions etc. With Stena Line carrying over 370,000 cars, 9,000 coaches and 1,700,000 passengers to and from Ireland via the ports of Holyhead and Fishguard in 2008, a huge opportunity is being missed to position Wales as a tourist destination in the ROI market. The significant and heavy weight investment in marketing other parts of Britain (and Ireland) could have a serious impact on the appeal of Wales to overseas tourists. Awareness of the exceptionally high quality standards of the Welsh tourism product will be reduced through a lack of marketing to overseas consumers. With the exception of 2009, Visit Wales has successfully undertaken strategic overseas destination marketing campaigns either solely or in partnership with air and sea carriers. These campaigns were aimed at giving Wales an identity in the same way that Visit Scotland has been successful in its positioning strategy. Wales was always seen as a doorway to a final destination however the previous campaigns were aimed at challenging perceptions and expectations and making consumers consider Wales as a place for a great break with lots to see and do. During the campaign period and for a time thereafter, Wales would have been front of mind when considering a break. It is essential for Wales to maintain a high profile as a tourism destination otherwise the success of these previous campaigns will be undone and it’s profile will remain in the shadow of Scotland, England and Ireland—Wales will “fall oV the map” for overseas visitors. Negative perceptions of Wales still exist and it is up to Visit Wales to challenge these perceptions and create an identity for Wales as a destination that is relevant and appealing to modern consumer lifestyles. Perceptions are hard to change and require continuous investment in branding and marketing to be overcome. In addition to the product and destination based marketing, new opportunities exist in the Cruise, Golf and Business tourism sectors. To drive these sectors a joined-up co-ordinated approach to marketing is critical.

5. Future WAG—Ports Cooperation Links between individual ports in Wales and the Welsh Assembly Government are on the whole strong and productive but generally on the basis of Welsh Ports acting independently. The Wales Freight Group, whose members include port operators, developed a Wales Freight Strategy published in 2008. At the beginning of March this year a group of strategic Welsh ports collectively met the Deputy First Minister to look at a range of issues confronting the industry. Following on from this meeting and in recognition of the need a Welsh Ports Group has been established which will meet for the first time in CardiV on 3 June 2009 and will involve Welsh Government oYcials. We fully support this initiative and hope it will be the first of regular meetings and to enable Ports to become far more closely linked to the Assembly process.

Other Important Issues Affecting Welsh Ports We are taking the opportunity of highlighting other important issues that will aVect some or all ports in Wales. It is hoped that the committee will take note of the comments below. Given the Global Economic downturn and associated issues the Port industry and its core shipping customers face a continued and very diYcult trading climate. Now is not the time for the UK Government to be introducing further and more onerous regulatory and financial burdens.

Marine and Coastal Access Bill Currently, ports policy in Wales is non-devolved. However, important decisions on infrastructure connections are devolved to the Welsh Assembly, although the funding is allocated centrally from London. This is quite distinct from Scotland and Northern Ireland where ports policy is a devolved matter and where, as a result, significant diVerences are emerging. In broad terms, ports in Wales support current ports policy in as much as it is based on private sector, free market principles with a minimum of government involvement. Nevertheless, this arrangement still demands a strong relationship with government which makes ultimate decisions on road and rail spending and which issues licences and consents on which the proper functioning of the industry depend. Under the Marine and Coastal Access Bill a new Marine Management Organisation (MMO) will be set up. This has been supported by both the British Ports Association (BPA) and the UK Major Ports Group (UKMPG) in as much as it will streamline the licensing system and bring together various parts of government which at the moment work separately, which sometimes results in tedious process delays. Processed: 29-10-2009 23:00:05 Page Layout: COENEW [O] PPSysB Job: 435922 Unit: PAG7

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We are therefore concerned about the implications of a recommendation proposing that the functions of an MMO should be a WAG responsibility. The MMO represents a new start in bringing together functions and personnel within one organisation with a clear remit; any diversion of these functions elsewhere could undermine the MMO and the principle of a “one stop shop”. Equally, we believe there is a real danger that the recommendation will simply perpetuate the status quo with responsibility for licensing still split between various departments. Tied to this is the issue of cost and resources. Ports in Wales are naturally concerned that WAG will not be adequately resourced or funded to implement the MMO changes.

Business rates at UK ports Increases in port rates and the matter of retrospective charges are a serious financial burden on port operators. Prior to the 2005 Rating List the valuation of Ports as a qualifying statutory docks and harbour undertaking was undertaken by reference to regulations made by the Secretary of State namely the Docks and Harbours (Rateable Values) (England) Order 2000 (SI 2000/951), and The Docks and Harbours (Rateable Values) (Wales) Order 2000 (SI 2000/948). These Orders established a “formula” based approach to the valuation of qualifying statutory undertakings. The formula took into account the relevant income and expenditure of the undertakings (as defined in the Orders). No such Orders were made for the prescription of ratable values by formula when compiling the 2005 Rating List and all Dock and Harbour undertakings in the United Kingdom were valued by reference to conventional valuation methods. Following on from the application of this new valuation method, 2005 saw some Welsh Port suVer a crippling rise in rateable value. Holyhead Port for example saw its rateable value increase from £1,167,000 to a staggering £4,000,000, an increase of over 242%. This rateable value increase translated to a rates paid increase of some £1.2 million plus per annum at Holyhead. This sudden and extraordinary rise in business rates was felt immediately at all Welsh Ports since a decision not to allow business rate transitional relief in Wales was taken at about the same time by the Assembly. Although this same “new valuation” method was used to revalue all UK ports its should be noted that our competitor ports in England were given five year transitional business rates relief—a rather unfair situation I’m sure you would agree. Calculations carried out by our valuation consultants have demonstrated that Holyhead Port paid a premium of £3.5 million over the five year listing period for the privilege of being located in Wales. This lack of transitional relief in Wales has clearly distorted the competitive ports market. Absorbing business rates year on year of this magnitude is diYcult without adopting significant cost cutting measures and of course it goes without saying that this rather unfair burden is most definitely an investment deterrent. As a footnote to the valuation concerns Holyhead Port is now seeing its contractors being separately assessed for business rates? Although discussions are still taking place with the VOA as regards the legitimacy of such assessments we would like to put on record our concerns that should our contractors be forced to pay business rates then this will only serve to drive the ports running costs upwards since the contractors will seek to recover such costs from the Port itself.

Light Dues The announcement made on 10 June 2009 by the new Shipping Minister Paul Clark was most unwelcome. Light dues are contributions paid by the shipping industry for the provision and maintenance of aids to navigation, such as lighthouses, buoys and beacons, around the UK and Irish coastline. Following a public consultation, light dues will rise from 35p to 39p per ship net registered ton (nrt) from 1 July this year with a further increase to 43p on 1 April 2010. The maximum number of chargeable voyages each year will also rise from seven to nine, with the upper tonnage threshold of 35,000 increasing to 40,000 nrt in 2010–11. Such significant rises in light dues increases the cost for all shipping companies using Stena Line Ports and will most surely make port calls to Wales a less than attractive proposition for visiting Cruise Ships. This increase takes place at a time when WAG and the Cruise Wales organization are trying to encourage more cruise ships to the Irish Sea. We hope the above is helpful to the Committees deliberations and of course we will be happy to answer any further questions at your convenience. June 2009 Processed: 29-10-2009 23:00:05 Page Layout: COENEW [E] PPSysB Job: 435922 Unit: PAG7

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Written evidence from the City and County of Swansea RESPONSE FROM PLANNING SERVICES 1. Overview 1.1 The Council’s land use planning policies and proposals for future development are set out in the City and County of Swansea Unitary Development Plan (UDP). The UDP was adopted in November 2008. As such it provides an up to date planning framework to determine applications submitted to the authority and guide new development and emerging strategies. 1.2 The UDP makes clear the importance of the operational port and dock to the local economy, providing jobs and future business opportunities. At the same time it also recognises the regeneration potential and strategic significance of the wider waterfront area that extends eastwards from the River Tawe, of which the Port is a major element. The UDP facilitates opportunities for non-port related uses at this location in the future where this is considered appropriate as part of an overall regeneration strategy for the area. 1.3 The UDP takes account of the aims and aspirations of the Wales Spatial Plan (2008), which establishes the overarching spatial strategy for the region. Revitalising the Swansea Bay Waterfront area and realising its commercial and tourism potential is a key element of the Spatial Plan, which is clearly recognised in the UDP. 1.4 Any future planning applications on land within, and adjacent to, the Port will be determined within the context of this local and national planning context.

2. Relevant UDP Policies and Proposals 2.1 The UDP contains a site specific policy AS12 “Port and Docks”. This states: Development proposals that enhance the viability of the port, extend the use of the ferry terminal facilities and increase employment and business opportunities will be permitted, provided that such proposals are compatible with adjacent development areas, communities, environmental enhancement schemes, and safeguard the potential canal route corridor. The policy amplification emphasises that proposals which enhance facilities and operations at the Ferryport, or increase commercial docks activity, will be supported where development has suitable regard to issues of amenity, land use compatibility and environmental impact. The policy recognises that considerable Permitted Development (PD) rights exist for docks related development, but that where proposals are subject to Environmental Impact Assessments Regulations the PD rights will not apply. The policy also specifies that future development within the port must have regard to the potential for future enhancement of the rail freight network and also safeguard the canal route protection corridor that aims to link the Tennant Basin with the Prince of Wales Dock (UDP Policy HC31 refers). 2.3 Policy AS12 highlights that future development of the port and dock will be an important consideration in the ongoing work to develop a waterfront regeneration masterplan for the wider Swansea Bay area. This links to the aims expressed in the UDP Spatial Strategy, which states that supporting appropriate redevelopment opportunities and regeneration initiatives at the urban waterfront area will contribute to the Plan’s sustainable settlement strategy. The UDP Spatial Strategy specifically highlights that: “the extensive area of brownfield land on the eastern approach to the City, south of Fabian Way and east of SA1 Swansea Waterfront, oVers considerable regeneration opportunities. Land within, and adjacent to, the existing Queens Dock may become surplus to requirements during the lifetime of the Plan. Redevelopment of these areas has the potential to create a major mixed use destination in order to: — enhance linkages between a number of sites and locations along the Fabian Way corridor; — build upon the success of SA1 Swansea Waterfront; — provide opportunities for potential new tourism, leisure and commercial developments in a range of settings; and Contribute— to the creation of a strong sustainable transport corridor.” 2.4 Outside the Port, the land south of Fabian Way and east of SA1 Waterfront is generally promoted in the UDP as being suitable for future commercial/business development. The area is considered to have potential as a strategic employment area that can contribute to the growth needs of the local economy and support the objectives of the Council’s Economic Regeneration Strategy. This area is shown on the UDP Proposals Map as land either unallocated (“white land”) or designated for employment development under UDP Policy EC1 Employment Site 5 “Docks”. 2.5 The UDP also features site specific policy EC2 “SA1 Swansea Waterfront”. The Policy identifies this high profile, prestigious destination for further mixed use development. Regeneration of this 40 ha former Processed: 29-10-2009 23:00:05 Page Layout: COENEW [O] PPSysB Job: 435922 Unit: PAG7

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dock has already transformed the eastern approach to Swansea and once completed is anticipated to include a new marina, 2000 residential units, around 600,000 sq ft of commercial space and a leisure element. The policy emphasises that: “the redevelopment of SA1 is suitably integrated with adjoining areas, particularly the existing Maritime Quarter and retained commercial docks. Development within these areas must be compatible with existing land uses and not inhibit redevelopment proposals and strategies.” 2.6 Relevant extracts from the UDP are attached to this note as Appendix A.

3. UDP Public Inquiry 3.1 The UDP was subject to a Public Inquiry, which closed in August 2007. Objections to the treatment of the port area in the UDP were submitted to the authority during public consultation stage, prior to the Public Inquiry. 3.2 Objections from Associated British Ports (ABP) were submitted regarding the form of wording to be used in Policy EC1 “Employment Sites (Site 5—Docks)”, Policy AS12 “Port and Docks”, and also the UDP Spatial Strategy expressed in Part 1 of the Plan. ABP conditionally withdrew their objections in advance of the Inquiry commencing, since the company was satisfied with the Council’s proposed revisions to these elements of the Plan. These revisions were reached via negotiations between the parties before the Inquiry was held. The Inquiry Inspector confirmed in his report of recommendations that he also supported the Council’s proposed revisions, which were subsequently published as “Post Inquiry Modifications”. 3.3 The former Welsh Development Agency (now Welsh Assembly Government) and BP also submitted objections relating to the Waterfront area (UDP Part 1, and Policies EC1-2 refer). These essentially asserted that the UDP does not contain a suYciently explicit policy framework for the future development of land at this location. The Council rejected these assertions and, aside from the modifications agreed following negotiation with ABP (which were proposed by the Council in advance of the Public Inquiry), no further changes to the UDP were made. The Inquiry Inspector confirmed in his report that he supported the Council’s position on this issue. 3.4 A summary of the objections submitted to the UDP by ABP, BP and the former WDA together with the Council’s response are attached as Appendix B.

4. Conclusions and Further Planning Issues 4.1 The UDP provides a clear framework for the consideration of future planning proposals at the port and adjoining areas. Redevelopment of port land considered surplus to requirements may be considered appropriate subject to the criteria and safeguards set out in the UDP, and provided the viability of the wider port is not compromised. 4.2 The UDP confirms the Council’s commitment to contributing to the emerging masterplan on a joint basis with the Assembly Government, adjoining authorities and other partner organisations, in line with the recommendations of the WSP. It is important for this work to move forward on a joint basis and that a collaborative approach is taken to formulating an overarching strategy for land south of Fabian Way. This will give coherence to the significant planning proposals and initiatives that have been proposed, or are emerging, for this area. These include: — proposed Swansea University Campus on land south of Fabian Way; — proposed Biomass facility; and — use of Queens Dock for large ship decommissioning. 4.3 The UDP is to be replaced within the next four years by a new form of development plan known as the Local Development Plan (LDP). The Council is to formally begin preparation of the Swansea LDP later in 2010, which will set out the Council’s strategic vision, aims and objectives for the use and development of land over an ensuing 15 year period. It is possible that land within and adjacent to the port is submitted to the authority as a Candidate Site for development consideration. 4.4 Finally, any future proposals that may have an impact on the designated Crymlyn Bog Special Area of Conservation (SAC) will need to be carefully assessed with regard to the Habitats Regulations.

APPENDIX A SELECTED EXTRACTS FROM UDP WRITTEN STATEMENT Spatial Strategy (xi) The Spatial Strategy is summarised in Diagram 1 and amplified with site specific detail in the Proposals Map. It eVectively determines the sustainable settlement strategy for the UDP, which is to: — capitalise on the redevelopment opportunities aVorded by brownfield land and the Waterfront area; — support regeneration initiatives within the urban area and free standing settlements with good transport links; and Processed: 29-10-2009 23:00:05 Page Layout: COENEW [E] PPSysB Job: 435922 Unit: PAG7

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— limit development opportunities within the countryside areas of Gower, Gower Fringe and Lliw Uplands to that which supports local needs and appropriate sustainable tourism. (xii) The Spatial Strategy reflects WAG’s vision for the regeneration of Swansea Waterfront, which emanates from the WSP. The extensive area of brownfield land on the eastern approach to the city, south of Fabian Way and east of SA1 Swansea Waterfront, oVers considerable regeneration opportunities. SA1 lies adjacent to the commercial docks, which make an important contribution to the economic infrastructure of the County. Land within, and adjacent to, the existing Queens Dock may become surplus to operational requirements during the lifetime of the Plan. Re-development of these areas has the potential to create a major mixed use destination, in order to: — enhance linkages between a number of sites and locations along the Fabian Way corridor; — build upon the success of SA1 Swansea Waterfront; — provide opportunities for potential new tourism, leisure and commercial developments in a range of settings; and — contribute to the creation of a strong sustainable transport corridor. (xiii) In line with the recommendations of the WSP, any future proposals for the redevelopment of such a significant brownfield waterfront and coastal area will be considered with the benefit of the waterfront regeneration masterplan for the wider Swansea Bay area. This will be prepared on a joint basis between adjoining Authorities and relevant partners to provide an overarching development framework for the area.

General Employment Sites

Policy EC1 Employment land is allocated at the following locations to meet the growth needs of the local economy: ha Strategic Business Park 1 Felindre 190.0 Strategic Mixed Use Sites 2 SA1 18.0 3 Swansea Vale 25.0 Strategic Sites 4 Swansea West Industrial Park 60.0 Local Sites 5 Docks 34.0 6 Swansea Enterprise Park 14.2 7 Bryngwyn Works, Gorseinon 3.0 8 Players Estate, Clydach 2.5 9 Garngoch Industrial Estate 5.0 10 Land at Bryntywod, Felindre 15.8 11 Crofty Industrial Estate 4.0 12 Penllergaer Business Park (no B8) 8.2 Total 379.7

(5) Docks The Docks are owned and managed by Associated British Ports (ABP) and make an important contribution to the industrial infrastructure of the City. The remaining operational docks and general industrial side of the port provides opportunities, primarily around the Kings Dock and Queens Dock, for B1, B2 and B8 uses. Development within the area is technically constrained by a notified hazard safeguarding zone around the BP sphere. This installation is in the process of being removed and the Council is negotiating with BP to rescind the hazardous substance licence, until which time the zone must remain on the Proposals Map. Port related activities within the operational docks are exempt from planning control. However some land to the eastern side of the docks alongside Fabian Way, which is one of the main approach corridors and a key gateway to the City, has been disposed of by the docks operators. Planning control exemptions do not therefore apply, and within this sensitive area the Council will seek substantial environmental improvement. Care will need to be taken to minimise the visual and physical impact of any proposed land uses/ developments and to ensure the proposed canal route corridor is safeguarded and an attractive frontage is created for it. Development that would compromise the potential redevelopment of adjoining areas will not be supported. There is potential for further releases of land within the Queens Dock for development other than port related activities. The WSP emphasises that the revitalisation of significant brownfield sites in this coastal location should be delivered with the benefit of a waterfront regeneration masterplan for the wider Swansea Bay area. The Council will contribute to the formation of this masterplan on a joint basis with adjoining Processed: 29-10-2009 23:00:05 Page Layout: COENEW [O] PPSysB Job: 435922 Unit: PAG7

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authorities and relevant partners, to provide a suitable development framework against which to consider future proposals for redevelopment. Any proposals to alter the water level within the Prince of Wales Docks will be carefully assessed via the Habitats Regulations as there is a direct hydrological link between Crymlyn Bog SAC and the Kings and Queens Docks and Tenant Canal.

SA1 Swansea Waterfront

Policy EC2 A major redevelopment area is identified at SA1 Swansea Waterfront for mixed employment and residential development together with supporting leisure, tourism, community uses and ancillary services. The development of the site should: (i) be comprehensive; (ii) integrate with the Maritime Quarter; (iii) complement and not compete with the City Centre; (iv) be of a high standard of design; (v) embrace principles of sustainable development; (vi) provide high quality employment opportunities; (vii) increase the range of housing choice; (viii) make appropriate provision for a network of pedestrian and cycle routes; and (ix) safeguard the potential canal route corridor.

2.3.7 A robust and comprehensive policy context for considering proposals within SA1 Swansea Waterfront is set out in adopted SPG. This guidance has been augmented by an outline planning consent for the site and a Design and Development Framework prepared by the former WDA (now WAG). Together these make clear the broad characteristics and objectives that development within the site must adhere to, emphasising the importance of high quality design and principles of sustainable development. Development of the site will need to be comprehensive in land use and urban design terms, with the aim of achieving a suitably integrated mix of land uses, rather than a disjointed collection of unrelated development. Additionally, development proposals will not be supported where they would undermine the attractiveness, vitality or viability of the City Centre. 2.3.8 It is important that the redevelopment of SA1 is suitably integrated with adjoining areas, particularly the existing Maritime Quarter and retained commercial docks. Development within these areas must be compatible with existing land uses and not inhibit redevelopment proposals and strategies. 2.3.9 A programme of infrastructure work is planned with a view to bringing the dock into use as a major marina facility. The SPG and Development Framework provide detail on the use of water areas within the Prince of Wales Dock basin, including the type of uses and activities that are envisaged. Any proposals to alter the water level within the Prince of Wales Docks will be carefully assessed via the Habitats Regulations as there is a direct hydrological link between Crymlyn Bog SAC and the Prince of Wales Dock and Tenant Canal. 2.3.10 The development of an integrated regional waterway, based on the 35 miles of Neath, Tennant and Swansea Canals and linked via the Docks and Swansea Basin, is considered a unique tourist and recreational opportunity within the area. Development within SA1 will be required to safeguard the route linking the Tennant Canal to the Prince of Wales Dock and Tawe Barrage basin.

Port and Docks

Policy AS12 Development proposals that enhance the viability of the port, extend the use of the ferry terminal facilities and increase employment and business opportunities will be permitted provided that such proposals are compatible with adjacent development areas, communities, environmental enhancement schemes, and safeguard the potential canal route corridor.

Amplification 5.3.49 The operational port and docks is an important commercial asset, providing jobs and business opportunities that contribute towards economic regeneration Proposals for enhancing facilities and operations at the Ferryport and increasing commercial docks activity will be supported where development has suitable regard to issues of amenity, land use compatibility and environmental impact. Whilst considerable Permitted Development (PD) rights exist for docks related development, where proposals are subject to Environmental Impact Assessments Regulations the PD rights do not apply. Any proposals to Processed: 29-10-2009 23:00:05 Page Layout: COENEW [E] PPSysB Job: 435922 Unit: PAG7

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alter the water level within the Prince of Wales Docks will be carefully assessed via the Habitats Regulations as there is a direct hydrological link between Crymlyn Bog SAC and the Kings and Queens Docks and Tennant Canal. 5.3.50 Development within the port must safeguard the canal route protection corridor, which aims to link the Tennant Basin with the Prince of Wales Dock and the River Tawe. Additionally, proposals must have regard to the potential for future enhancement of the rail freight network. 5.3.51 The future development of the port and docks will be an important consideration in the proposed waterfront regeneration masterplan for the wider Swansea Bay region. The Council will contribute to the formation of this plan on a joint basis with other relevant authorities and partner organisations, in line with the recommendations of the WSP.

APPENDIX B SUMMARY OF RELEVANT OBJECTIONS SUBMITTED TO UDP AND CITY AND COUNTY OF SWANSEA COUNCIL’S RESPONSE SPATIAL STRATEGY

Consultee Objection Council Response BP Redraft section to ensure the UDP Section B makes clear that the aims and aspirations 186/1 recognises the strategic context of of the WSP are a key facet of UDP policies and 186/2 the area, which extends from SA1 proposals to revitalise waterfront areas. This 186/4 to Llandarcy Urban Village and section sets out the overall regional context of the 186/5 Baglan Energy Park, as identified UDP strategy and makes specific reference to the in the WSP. The promotion of this development of an integrated waterfront strategic vision is fundamental to regeneration masterplan, which the WSP the achievement of local and emphasises will be central to the revitalisation of strategic objectives and should be brownfield sites in coastal locations within the supported by appropriate Part 2 wider Swansea bay area. The Council will policies, which will need to ensure contribute to the formation of this masterplan, that community needs are fully which will provide the overarching development addressed given the historical framework to consider the suitability of proposals nature of activities in the local in this area. The recommendations of the area. masterplan will inform subsequent revisions to the UDP. Section C states that a revitalised waterfront area is a core element of the UDP spatial strategy and focuses on the emerging SA1 development. Consider amendment to Section C, paragraph (i), to emphasise the development potential of adjacent areas to the south and east of SA1. It is considered premature to insert new Part 2 policies relating to this issue prior to the formulation of a clear strategy at the regional level. There are a range of UDP policies that require development proposals to give appropriate consideration to the impact upon nearby communities. WDA Amend to define and promote the Section C states that a revitalised waterfront area is 42/1 Fabian Way corridor as a strategic a core element of the UDP spatial strategy, 42/2 development opportunity in line focussing on the emerging SA1 development. 42/3 with the recommendations of the Consider amendment to Section C, paragraph (i), 42/5 WSP. to also emphasise the development potential of adjacent areas to the south and east of SA1. Part 2 policies and proposals also recognise that the eastern approach to the city is one of the key gateway approaches into Swansea, and that the Fabian Way frontage is a sensitive area where the Council will seek substantial improvement. Part 2, Section 2.2 in particular makes clear that waterfront regeneration is one of the key themes of the UDP economic strategy to revitalise Swansea and the wider south west Wales region. It identifies a number of strategic activities that are seen as the means to deliver this aim, which includes promoting improvements and developments at appropriate locations around Swansea Bay. Processed: 29-10-2009 23:00:05 Page Layout: COENEW [O] PPSysB Job: 435922 Unit: PAG7

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Consider amendment to Section 2.2 (Part 2) to refer to the integrated waterfront regeneration plan for the wider area. WDA Policy SP5 should be amended to Policy SP5 includes a commitment to bring 42/4 define and promote the Fabian brownfield land in accessible waterfront locations Way corridor as a strategic back into beneficial use, which is pertinent to sites development opportunity in line along the Fabian Way corridor. No change with the recommendations of the proposed. WSP. WDA Support the Council’s strategic Support noted. Consider amendments to paragraph 42/18 approach to developing 2.2.2 as suggested. its economy through alignment with key policies and strategies. However, in addition to the discrete goals set out, the desire to achieve holistic and integrative regeneration needs to be recognised. It should be stated that, through the JRI, the Council and the Agency aspire to integrating all aspects of regeneration, including physical, economic and social aspects to maximise the eVectiveness of resources in delivering holistic regeneration in Swansea. ABP It is land within and around the Accept. Amend accordingly. 51/M/1 existing Queens Dock that may become surplus to operational requirements, rather than land within the existing dock per se. Propose minor amendments to text to reflect this.

POLICY EV41

Consultee Objection Council Response WDA The BP Chemicals installation at Until the licence is rescinded the Hazardous 42/6 Queens Dock has been removed Consultation zone and reference to the area within 42/16 from the list of notifiable the policy remains. If the license is rescinded during installations and should therefore the Deposit Period then the be omitted from this paragraph. plan and written statement can be amended prior to inquiry/adoption. No change proposed.

POLICY EC1

Consultee Objection Council Response ABP Policy should allow for vacant It is considered premature to insert a new UDP 51/1 operation land in and around policy relating to this issue prior to the formulation Queens Dock to be released for of a clear strategy at the regional level. The WSP redevelopment, prioritising port- emphasises that the revitalisation of significant related uses. If no suitable port brownfield sites in coastal locations should be related uses can be implemented, delivered with the benefit of a jointly prepared the policy should allow for waterfront regeneration masterplan for the wider development compatible with uses Swansea bay area. The Council will contribute to in the residual port. A new policy the formation of this masterplan, which will should be introduced to cover the provide an overarching development framework potential release of operational within which UDP policies and proposals can be land, which should be informed by formulated. Until such time as the masterplan discussions with ABP, BP and strategy is forthcoming, white land allocations will other interested parties to provide maximum flexibility in considering Processed: 29-10-2009 23:00:05 Page Layout: COENEW [E] PPSysB Job: 435922 Unit: PAG7

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formulate a strategic overview of redevelopment proposals for non port related uses. available land east and south of Redraft amplification paragraph 2.3.4 (v) to refer SA1. to the potential release of land within the existing operational port for development other than port related activities. BP Object to the exclusion of part of Part 1 of the UDP highlights that the aims and 186/6 BP landholdings at Queens Dock aspirations of the WSP are a key facet of UDP 186/10 from site EC1 (5). The policy policies and proposals to revitalise waterfront areas. should be more closely aligned with As such, the Council is to contribute to the the WSP, which promotes a sub- formation of a waterfront regeneration masterplan regional integrated waterfront. In for the wider Swansea Bay area, which will set out this regard, the opportunity exists an overarching framework against which proposals for a strategic review of the wider for the future development of the dock can be area to the east of Queens Dock. considered. In the meantime, the current white land allocation is considered appropriate to provide the necessary flexibility for assessing development options. Amend paragraph 2.3.4 (v) to refer to the preparation of an integrated waterfront regeneration plan and its implications for land to the south and east of SA1. BP The policy should place a greater Part 1 of the UDP highlights that the aims and 186/3 emphasis on the potential role of aspirations of the WSP are a key facet of UDP 186/7 the docks in regenerating the wider policies and proposals to revitalise waterfront areas. 186/8 urban waterfront area and omit Amend paragraph 2.3.4 (v) to refer to the 186/9 any reference to a notified hazard preparation of an integrated waterfront safeguarding zone. regeneration plan and its implications for land to the south and east of SA1. Until the licence is rescinded then the reference to the Hazardous Consultation Zone will remain. If the licence is rescinded during the Deposit Period then the plan and written statement can be amended prior to inquiry/adoption. ABP Should further land be released for Accept. Amend accordingly. 51/M/2 development within the operational port, the priority for ABP would be to identify “port related” uses. Request minor amendments to text to reflect this.

POLICY EC2

Consultee Objection Council Response WDA (i) The EC2 designation should be (i) Accept. Amend accordingly. (ii) Accept that the 42/9 extended to include the area parcel of land south of Fabian Way and east of the 42/10 immediately to the east of the access road is not included within the SA1 outline 42/14 Kings Dock, as this is included planning consent, the Development Framework, or within the SA1 outline planning the SPG for the site. As such, amend the allocation consent and Development of this parcel to white land. The land south of Framework for the site. (ii) The Fabian Way and west of the access road is allocated “finger” of land at the eastern end for service uses in the Port Tawe and Swansea of the currently allocated site is not Docks SPG. As such, the land forms part of the owned by the WDA, as is not proposals for SA1 and the allocation should be included within the SA1 outline retained. planning consent or the Development Framework for the site. As such, UDP should distinguish between this parcel of land and the wider SA1 site. WDA The WDA request that an Not accepted that a separate policy relating to 42/11 additional policy be inserted Water Based Activity within the Prince of Wales 42/17 after Policy EC2 on Water Based Dock is required. The SA1 Development Activity within the Prince of Wales Framework and Port Tawe and Swansea Docks Dock. This additional policy SPG provides detail on the use of water areas Processed: 29-10-2009 23:00:05 Page Layout: COENEW [O] PPSysB Job: 435922 Unit: PAG7

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should define the dock as a marina within the Prince of Wales Dock basin. These set and set out the acceptable uses and out the uses and activities that are envisaged, activities associated with it. including its use as a marina with associated activities. Consider amendment to amplification for purpose of clarification.

POLICY HC31

Consultee Objection Council Response WDA The location of the proposed link Accept. Amend Proposals Map accordingly. 42/15 between the Prince of Wales Dock to the River Tawe is inappropriate and should be revised in accordance with the approved Development Framework.

POLICY AS13

Consultee Objection Council Response ABP Object to the first proviso, which The policy is rolled forward from the Swansea 51/3 implies a presumption against Local Plan (Policy T17 refers). It is important that development at the Port to protect proposals within the port do not unacceptably adjoining areas. This is not based prejudice the likelihood of development schemes on any scientific analysis of coming forward within SA1 and that a suitable evidence and potentially constrains level of amenity is safeguarded for adjoining development and use of the Port. communities. Amend paragraph 5.3.42 to provide Development within the Port is further explanation relating to the requirement for subject to appropriate licensing/ integration with SA1 and highlight the importance assessment, at which time impact of ensuring development is consistent with aims of can be properly assessed and the emerging waterfront masterplan for the wider measured. The use of the term area. “properly integrated” in paragraph 5.3.42 is not suYciently amplified to be self explanatory. Health and safety implications and provisions of the International Ship and Port Facility Security Code 2004 and other legislation should take precedence for development within the Port and Docks.

Written evidence from the Department for Transport Introduction—The UK Ports Industry 1. The Department is pleased to submit this memorandum to help provide the context for the Committee’s inquiry into Ports in Wales. 2. The Department’s White Paper Towards a Sustainable Transport System recognised that ports are vitally important to our economic success. The United Kingdom ports sector is responsive and successful, despite the short term eVects on trade of the present economic downturn. Over the past three years consents for new container terminal capacity indicate that ports are continuing to respond to long-term growth and there is still plenty of interest in long-term investment in ports infrastructure. 3. Ports are gateways to the rest of the world, and in 2008 the 120 or so commercially active ports in the UK handled the movement of nearly £450 billion worth of international trade. In terms of freight, the 563 million tonnes of foreign and domestic traYc that passed through the UK’s ports make the industry the largest of its kind in Europe. These volumes are generated by a diverse industry, which is driven by a competitive market and which has experienced sustained year-on-year growth. 4. Ports policy for Wales is reserved to the UK Government except in respect of smaller fishing harbours. The Department for Transport liaises routinely with the Welsh Assembly Government on ports matters that are relevant to Wales. Processed: 29-10-2009 23:00:05 Page Layout: COENEW [E] PPSysB Job: 435922 Unit: PAG7

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Ports in Wales 5. Just as the ports industry throughout the United Kingdom thrives on diversity, Wales is well endowed with ports, handling a wide range of cargoes from raw materials through to containers, as well as passenger and roll-on roll-oV vehicle services to Ireland. Tables in the Annex show the evolution of traYc at major Welsh ports from 1965. 6. Milford Haven is one of the largest UK ports, but handles mainly oil and petroleum products, the inland movement of which can largely be handled by pipeline. Recent investment has led to the development of two Liquefied Natural Gas (LNG) terminals which are expected to account for a significant part of the UK’s gas consumption. 7. The ports on the Bristol Channel have a historical base in steel and related industries. But there is diversity. Port Talbot (one of the few deep water harbours in the UK) is utilised primarily to import iron ore and coal for the steel industry, whilst Newport is a general cargo port. In North East Wales, the Port of Mostyn handles general cargo, as well as the specialist export of Airbus A380 wings manufactured at Broughton. The major North Wales port is Holyhead—one of three ferry ports that provide services to Ireland—the others being Pembroke Dock, and Fishguard. These ports are part of the Trans-European Network, reflecting their strategic importance in linking Ireland, Great Britain and mainland Europe. Both ports and ferries have been upgraded in recent years, reflecting the significant growth in freight traYc across the Irish Sea.

National Ports Policy and Issues 8. In 2000, the Government published Modern Ports, its key statement on ports policy, and whilst the industry has since experienced significant change, the main thrust of that policy has remained the same and was reiterated in the Interim Policy report on ports policy of July 2007 following a major consultation and review. This endorsed a regulatory framework that encourages continuing market-led investment while ensuring that ports develop and operate in a safe and environmentally responsible marine sector.

General Prospects and Forecasts 9. The main growth sectors are in containers and roll-on roll-oV services, demand for which has been forecast to more than double by 2030. The growth is mostly import-led. The present economic downturn has caused a short-term decline in these sectors and eased the capacity pressure at deep-sea container ports but a number of major capacity enhancements have been consented in recent years and whilst present economic conditions are depressing demand temporarily the MDS40 demand forecasts out to 2030, published in 2006 and updated in 2007, still remain a sound basis for assessing longer term need. 10. Growth in bulk and general traYc is much slower. An exception is liquefied natural gas, a major import at Milford Haven, which is expected to grow rapidly but from a small base. 11. Ensuring that the industry will be able to develop, sustainably, to meet emerging demand is crucial if the economy is to continue to benefit as it does from the success of UK ports. Inevitably, this will require a particular focus on the related requirements of the planning system, and the provision of surface access.

Regional Ports Policy 12. The Department recognises that ports are significant local employers and can make an important contribution to the regional and local economy. In association with the review of ports we examined a range of regional issues that might need to be addressed within an overall national approach. These issues are generally taken into account in Regional Spatial/Transport Strategies and in Regional Economic Strategies.41 As stated in the Interim Report, a detailed policy on how and where the Government wishes to see ports develop in each region would add little if anything to this.

Public Funding of Ports 13. In our Interim Report on ports policy, we stressed that subsidy to port operations should generally be avoided, as it tends to distort competition and is unnecessary for the provision of suYcient capacity. Only in extreme circumstances of demonstrable market failure, environmental impact or significant net regeneration eVects, should it be considered. 14. The Department’s focus is rather on ensuring there is an adequate strategic network for inland movements of goods to and from ports. The Department continues to undertake work on end to end journeys and identifying the key inter-urban corridors and the key international gateways that are the most economically significant parts of the network and are showing signs of increasing congestion and unreliability. The provision of high quality inland infrastructure, linking ports with importers and exporters in the hinterlands, is a key issue for the ports industry. To freight shippers the attractiveness of a port is heavily influenced by the relative eYciency and reliability of its inland connections.

40 The Department’s consultants who produced these forecasts and updated them in 2007. 41 In Wales a separate strategic planning regime has been established, based around the Assembly Government’s Wales Spatial Plan as well as its economic and transport strategies. Processed: 29-10-2009 23:00:05 Page Layout: COENEW [O] PPSysB Job: 435922 Unit: PAG7

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15. The Future of Transport set out the Department’s strategy for delivering a transport network for 2030, built around the central themes of sustained investment; improved management; and planning ahead. Mechanisms such as the Regional Funding Allocations (RFAs), Sustainable Distribution Fund (SDF), and now the productivity tranche of the Transport Innovation Fund (TIF), exist to support the costs of road and rail infrastructure.

16. An important aspect of the inland access issue centres upon the eVectiveness of developer contributions—the system under which developers, through agreements under planning and highways legislation,42 are obligated to contribute financially to the road and rail upgrades that the proposed development will necessitate. DfT has published new guidelines on developer contributions in England following consultation last year. The aim is an equitable and transparent approach that ensures developers contribute in respect of the impacts they and their customers impose on transport networks, without discouraging worthwhile investment.

Surface Access—Wales 17. The Minister of State (Lord Adonis) met the WAG Deputy First Minister (Ieuan Wyn Jones) on 13 May to discuss cross border road and rail issues. OYcials have frequent routine contact.

18. The Department for Transport is responsible for specifying and funding the infrastructure outputs that the Government wishes to buy from Network Rail in England and Wales and specifying and funding the franchised services operated by Virgin West Coast, First Great Western and Arriva Cross Country. The Railways Act 2005 requires the Secretary of State to consult the Welsh Assembly Government about proposals for such cross border franchises before issuing invitations to tender. The Welsh Assembly Government is responsible for specifying and funding the ATW services that operate wholly in Wales and across the Wales-England border. It also has powers to purchase additional services for Wales via franchises let by DfT, and to invest in rail infrastructure.

19. Similarly for the planning of rail services the Department continues to work with the Welsh Assembly Government, Network Rail and other stakeholders to ensure the needs of the freight industry in Wales are taken into account in making decisions about rail infrastructure.

20. The development of a strategic rail freight network (SFN) announced in the White Paper Delivering a Sustainable Railway in 2007 for England and Wales, with a funding allocation of £200m, will be a progressive programme of network enhancement to increase the logistical eYciency of the railway. Enhancements will range from small scale incremental ones to major infrastructure schemes that will especially benefit freight services.

21. Wales has important but entirely separate links in the north and south. In the north the passenger service to Holyhead is a very important link to Ireland, whilst in the south the rail service to Fishguard provides a similar though less heavily used connection. Freight services also feed south Wales ports. DfT has recently funded a Freight Facilities Grant jointly with the Welsh Assembly to achieve environmental benefits from modal shift at Barry Docks.

22. The Department for Transport’s Highways Agency has the role of operating, maintaining and improving the strategic network in England. The Welsh Assembly Government is similarly responsible for the strategic network in Wales. The Welsh Assembly Government is similarly responsible for the strategic network in Wales and works closely with the Highways Agency on cross-border issues with the aim of ensuring road connections such as the M4 and M48 Severn Crossings are as seamless as possible. Any activities on these and other strategic routes into and out of Wales are planned and pursued via well established liaison channels that ensure a continuity of service.

Environmental Impacts of Ports 23. Like much of the United Kingdom, Wales has a precious coastline with important natural habitats. The Department for Transport has stated its goal as being the development of a ports sector that is compatible with the Government’s social and environmental objectives. A wide-range of domestic and European legislation now exists to govern the environmental obligations of ports, particularly with respect to their expansion. The Government has seen its own role, in keeping with its overall market-led approach to the industry, as one of making ports aware of their obligations while trying to avoid unnecessary and disproportionate burdens. In 2006 a discussion document sought views on how far ports succeed in meeting their environmental duties, in particular with respect to air pollution, noise and waste management, and what further action might be taken to ensure fulfilment of such duties.

42 Notably section 106 of the Town and Country Planning Act 1990 as amended, and, in the case of roads, section 278 of the Highways Act 1980. Processed: 29-10-2009 23:00:05 Page Layout: COENEW [E] PPSysB Job: 435922 Unit: PAG7

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Planning and Major Infrastructure 24. The Planning Act 2008 has established a new structure aimed at streamlining the planning process for nationally significant infrastructure projects (NSIPs), including major ports. Preparations are well advanced for the establishment of the new Infrastructure Planning Commission (IPC).

25. The Government intends to produce a National Policy Statement (NPS) on ports to set out the policy context for the NPS to take on the role of decision-maker for such projects. Work is in hand on developing this NPS, and there will be public consultation on the details in due course. The intention is that it will be fully consistent, in all fundamentals, with the policy as set out in the Interim Report.

26. DfT has also issued guidance on the preparation of port master plans.43 As with the creation of the IPC, this responds to the need for greater clarity and expedition in the planning system as a whole. In particular, we strongly encourage ports to engage with local authorities, development agencies, network providers and others from the earliest stages of planning of major development. This can help produce a better designed development proposal, minimising adverse environmental and transport impacts and securing improvements where possible.

Port Governance and Ownership 26. Wales has five trust ports—Caernarvon, Milford Haven, Neath, Newport and Saundersfoot, the largest being Milford Haven. Trust ports are independent statutory bodies, run by independent boards, for the benefit of stakeholders. They do not have shareholders or owners, any surpluses are used exclusively for the safe and eVective operation of the harbour. The Government has issued guidance to the trust port sector which aims at setting the standards we expect trust ports to achieve in terms of governance and commercial activity.

27. The Government has no wish to use its powers to compulsorily privatise any trust port. But it emphasises that trust ports must be seen to be competing fairly, by promoting transparency of commercial and wider objectives. On 7 April this year we completed a consultation exercise on revised guidance on Modernising Trust Ports to assist this. We issued Municipal Ports Guidance. In May 2007, the Department published Opportunities for Ports in Local Authority Ownership, which encourages the sector to follow the approach taken in Modernising Trust Ports, in particular establishing harbour management committees.

28. The guidance has specifically requested that Milford Haven, and other of the larger trust ports, in England, report to the Government on their analysis of structural change. This is not a prelude to forced privatisation but a desire to see the trust ports analysing their corporate structures and keep them under review with a view to identifying opportunities to enhance their eYciency and get value from their assets. We have asked for reports to be with us within the next 12 months.

29. Opportunities for Ports in Local Authority Ownership, was published in May 2007 by the Department and Welsh Assembly Government. This Review encourages the sector to follow the approach taken in Modernising Trust Ports, in particular establishing harbour management committees. We are currently in discussion with the Welsh Assembly to update this Review.

30. Notwithstanding this approach, the majority of ports in the United Kingdom, including in Wales, may be classified as “small ports”, and while a number of these are active in freight traYc, the small ports sector is largely focused on fishing, leisure and tourism. Thus, the link between small ports and local economies is pronounced. In formulating ports policy, the Government is conscious of the need to allow small ports the independence and flexibility to respond to evolving markets. Small ports also have a significant role to play in coastal shipping, allowing goods to be landed near their eventual destinations following transhipment, thereby alleviating congestion on the inland networks.

Cruise 31. The cruise industry has strong expectations for growth in the UK cruise market. There are distinct segments of the cruise business. The array of terminals at Southampton, for example, serves mainly Mediterranean or more distant deep sea destinations. But there is an important market for coastal or short sea cruises from UK and other ports serving a growing number of call-in destinations in the UK and Ireland. The major incentive for facilitating these services is tourism. Interest has been shown in the south west of England, Holyhead, Liverpool and other ports in promoting calls, driven by a potential contribution to the tourism business in the hinterland or catchment area of the port. This is entirely to be welcomed but, of course, in keeping with Government policy on competition and funding of ports, it is important that new developments should not be undertaken with public subsidy, which is likely to result in deadweight loss to the taxpayer and to competitive distortion.

43 http://www.dft.gov.uk/pgr/shippingports/ports/portspolicyreview/portmasterplans/guidanceportmasterplans1 Processed: 29-10-2009 23:00:05 Page Layout: COENEW [O] PPSysB Job: 435922 Unit: PAG7

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Border and Security Issues 32. Holyhead, Pembroke, Fishguard and Swansea ports operate ferry and freight services to and from various ports within the Common Travel Area (CTA). The CTA is an immigration arrangement providing for free movement within the UK, Republic of Ireland and the Crown Dependencies (Isle of Man and Channel Islands). The UK Border Agency undertook a full UK public consultation exercise on “Strengthening the CTA” earlier this year and the results were published on 15 January. A number of industry specific and regional stakeholder events were held and representatives from the Welsh ferry ports attended these events. As a result of feedback the Government recognised that the changes to the CTA must be viable and it is clear that traditional fixed immigration controls will not be introduced on any CTA route at this stage. 33. The Border Agency will continue to work with stakeholders throughout implementation to ensure that the reforms are both practical and eVective and that any negative impact on the public and industry is minimal—including passenger delays. 34. Security provision at Welsh ports is a reserved matter and is part of the UK-wide maritime security policy. The security measures applied at UK ports are proportionate to the assessed security threat and in accordance with international and EC requirements. The balance has to be found between facilitating the travelling public and trade, and providing protection through a range of deterrent, detection and preventative measures. 35. Transport Security Inspectors conduct a regular programme of inspection activity throughout the UK to ensure that the right resources, plans and procedures are in place, and ports in Wales are regularly inspected. 36. Welsh ports are policed by local police forces and funded through business rates. Local forces do not provide a dedicated port service but respond to incidents when called. If necessary, they would be supplemented or overseen by Special Branch resources. June 2009 Processed: 29-10-2009 23:00:05 Page Layout: CWMEM1 [E] PPSysB Job: 435922 Unit: PAG7

Ev 158 Welsh Affairs Committee: Evidence 2 Annex tonnes Million 1 FREIGHT AT WALES PORTS, TONNAGE, 1965 TO 2008 2.7 3.7 3.2 2.6 2.0 2.5 2.4 2.7 2.5 2.9 3.1 2.6 45.9 64.2 64.7 62.0 61.4 56.4 57.1 57.9 59.3 56.7 56.6 .. 1965 1970 1975 1980 1985 1990 1995 2000 2005 2006 2007 2008 V 1 Estimated for earlier years where figures for some ports not available 2008 figures are provisional Port TalbotNewportCardi SwanseaBarryNeathPenarthMilford HavenHolyhead 3.7MostynFishguard 4.5Anglesey 3.7Caernarfon 6.6Others 24.8 3.7 2.0Total 3.7 0.3 8.1 ..1 41.3 0.32 3.5 1.8 2.4 0.1 0.1 0.4 6.5 0.3 44.9 0.1 0.3 2.0 – 0.8 6.8 0.2 0.1 0.2 39.3 5.4 0.3 0.1 0.8 .. 2.5 0.8 – 8.9 0.1 32.4 0.2 0.2 5.2 0.2 0.1 1.2 3.2 .. 1.1 32.2 11.0 0.1 0.3 – 0.1 4.9 0.8 0.1 1.2 2.5 32.5 11.7 1.0 .. 0.2 0.3 6.8 4.0 0.9 – 0.1 1.2 2.7 33.8 8.6 0.4 0.6 0.3 0.4 7.8 1.0 0.5 37.5 2.3 – 4.0 – 8.7 0.6 0.9 0.1 0.5 0.7 0.5 – 34.3 3.4 3.8 – 9.1 0.4 – 0.9 0.3 0.4 0.6 0.4 35.5 – 4.1 2.8 0.5 0.9 – 0.2 0.5 – 8.1 0.7 0.5 35.9 4.2 – 0.5 0.8 3.2 0.2 0.6 – 0.4 – 3.5 0.6 0.4 – 0.2 0.6 .. – – .. 3.4 0.4 – 0.6 .. – .. 0.4 – ...... Processed: 29-10-2009 23:00:05 Page Layout: CWMEM1 [O] PPSysB Job: 435922 Unit: PAG7

Welsh Affairs Committee: Evidence Ev 159 1 units thousand Thousand passengers FREIGHT AT WALES PORTS, UNITS, 1965 TO 2008 PASSENGERS ON SHORT SEA ROUTES AT WALES PORTS, 1965 TO 2008 ...... 0.0 – 11 29 34 42 28 .. 1965 1970 1975 1980 1985 1990 19951965 2000 1970 2005 1975 2006 1980 2007 1985 2008 1990 1995 2000 2005 2006 2007 2008 V Provisional figures published in May 2009 are for tonnage only. Newport..Cardi 1 ...... SwanseaMilford HavenHolyheadFishguardTotal 50 .. .. 893 61 343 .. 447 .. 359 11 .. .. 791 280 .. 0.3 1,142 .. 289 430 0.2 1,594 – 239 .. 529 1,622 0.3 1 1,861 247 2,125 757 0.1 2,363 2,518 341 72 945 2,698 2,173 463 163 832 3,574 2,057 321 124 3,937 590 2,138 3,184 333 100 584 1,996 3,055 379 81 597 3,114 345 – 2,895 554 – SwanseaBarryMilford HavenHolyheadFishguardTotal ...... 52 0.0 278 3 120 .. 78 42 390 206 503 107 3 78 519 174 780 204 55 – 713 234 900 174 43 – 788 1,235 195 189 1,234 33 789 198 – 218 1,251 836 208 1 1,291 – .. .. – ...... Processed: 29-10-2009 23:00:05 Page Layout: COENEW [E] PPSysB Job: 435922 Unit: PAG7

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Written evidence from the UK Border Agency Introduction The United Kingdom Border Agency (UKBA) was established as a shadow agency in April 2008 to create a strong new force at the border by bringing together immigration, customs and visa checks to strengthen the UK Border. Full agency status was achieved in April 2009. This brought together the main three elements of government that operated to control border and immigration activity, the Detection element of HM Revenue and Customs, UK Visas and the Border and Immigration Agency from the Home OYce. The new agency works under the Home OYce umbrella. Operationally at the ports and airports, UKBA is represented by the UK Border Force (UKBF), made up of ex Immigration and ex Customs OYcers. It is a uniformed service and work is currently underway for all oYcers to move to a new UKBA uniform.

UK Border Force Wales falls within Central Region Directorate of UKBF and an early decision was taken that it justified a separate command led by an operational Assistant Director, allowing one person to assess risks, deploy resources and represent for the entire Principality. Whilst this Assistant Director has his own allocated resource in terms of people and funding, he also has a seat at the Central Region Management Board, allowing him access to regional resources if necessary. Bringing together the two main agencies who previously worked at the border gives real opportunities for a more flexible approach to border activity in order to provide enhanced coverage. Port Operators and other stakeholders have made positive comment on these changes as it simplifies their dealings with the control authorities. The remit of UKBF at the border is very wide, dealing with immigration matters at the frontier, fiscal matters, identifying prohibition and restrictions and addressing attempts to import counterfeit goods. To increase flexibility in dealing with all of these matters, a significant training programme has been initiated and the training of staV from legacy areas in the skills necessary to allow them to be deployed on most aspects of our work at the frontier is well underway. This will greatly increase our ability to respond to risks and generally increase flexibility at the border to the benefit of the innocent traveller by minimising queues and to allow us to focus on these imports, passengers or vehicles where we may need to spend more time in satisfying ourselves as to legitimacy. As part of these changes UKBF are developing a border zone concept. This will entail travellers being assessed during their primary contact with Border Force oYcers. Some travellers will be deemed worthy of further checking and will be referred for secondary examination but most travellers will be able to progress without further involvement from UKBF staV. Part of this assessment process will be the continuing development of the e-borders programme which will allow UKBA to export the border. Many checks will be carried out prior to the departure of the traveller thereby either allowing action to be taken overseas, if that is appropriate, or much more targeted activity on arrival in the UK. This project is very advanced with regard to air travel and, as part its continued expansion, the intention is that it will in time encompass sea travel. Meanwhile UKBA continues to develop its intelligence databases on freight movements to allow us to target high risk traYc into the UK. These databases are remote from Wales but they allow targeting of lorry and container freight arrivals throughout the UK, including traYc arriving at Welsh Ports. UKBF have also developed close relationships with the police at Welsh Ports and where appropriate, joint exercises are run. In addition meetings to share intelligence and plans are held on a weekly basis at the largest ports in Wales. An initiative involving the Police, UKBF and other agencies that is currently being worked on to enhance the security of the welsh coast line is “Coast Watch Wales”. The objective is to work in partnership with the maritime community to identify and promote the reporting of suspicious maritime and irregular coastal and maritime activity and is due to be launched in the autumn 2009. UKBF also attends regular meetings with WECTU (Wales Extremism and Counter Terrorism Unit) as well as meetings of the Bristol Channel and Cardigan Bay Portal Security Group. Both these meetings are forums for discussing emerging risks at the ports in Wales and how, in partnership, any such threats are best addressed.

Stakeholders UKBF took steps early on to engage with Port Operators and with shipping companies to establish how we could best work together to secure the border but also to ensure that traYc flows were kept as smooth as possible. All port operators were oVered the opportunity to sign a Service Level Agreement, covering matters of interest to both sides. Within this document was a section on queue times, where we would look to agree standards with the operator. At present, Port Operators in Wales have not formally signed oV these agreements but the spirit of the document has been recognised and both parties are clear about respective roles and expectations. Processed: 29-10-2009 23:00:05 Page Layout: COENEW [O] PPSysB Job: 435922 Unit: PAG7

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Recent Changes StaYng levels in Wales have been increased during the past year, allowing UKBF to set up a fixed base at Pembroke Dock to address the risk at that port as well as in the Haven and at Fishguard. This has been welcomed by the Ports and the Police based there. The staYng position in Holyhead is supplemented by the attendance of mobile immigration teams and at all ports in Wales additional mobile UKBF resources are sent when required. For example regular visits are made by national dog teams to Welsh ports who work with local staV to look for cash and Class A drugs in particular. Attendance at ports is risk based and this serves to enhance our control in respect of traYc from Ireland, particularly in relation to abuse of the Common Travel Area.

Results in Last Year The changes brought into place following the formation of UKBA and the Border Force deployment have shown a good return. Two of the highlights last year were the seizure of 24 million cigarettes at CardiV Docks (this was the largest single seizure of cigarettes in the UK last year) and the seizure of 11kgs of cocaine from a ship that had arrived at Port Talbot from South America. Following a successful prosecution at Swansea Crown Court the cocaine smuggler was jailed for 16 years. In addition there were 179 people refused leave to enter the UK via Welsh ports last year and three Algerians were prosecuted by Dyfed Powys Police for various forgery/counterfeiting oVences having been caught attempting to enter the UK through Fishguard.

Common Travel Area One other major risk relates to abuse of the Common Travel Area arrangements, in place between the UK and Ireland. UKBA has seen increased levels of abuse by air and by sea with a number of people attempting to use Ireland as a back door into the UK. Talks have taken place with the Irish authorities to develop a collaborative approach and we are working very closely with them to allow targeted interventions to take place. Our own analysis of risk has identified high risk arrivals and regular action is taken to meet ferries in this category. Legislation in the form of the Borders, Citizenship and Immigration Bill is before Parliament and we await its outcome. Preliminary discussions with Port Operators have taken place to examine options. If there were to be discussions as a result of this inquiry which look at the infrastructure of Welsh Ports, UKBA would welcome an invitation to get involved in the process at an early stage. July 2009

Written evidence from Unite Introduction This submission is by Unite the Union. Unite is the UK’s largest Trade Union with 2 million members across the private and public sectors. The union’s members work in a range of industries including manufacturing, financial services, print, media, construction, transport and local government, food, agriculture, education, health, not for profit and of particular relevance to this guidance the docks, rail, ferries and waterways sectors. The docks, rail, ferries and waterways sector has just under 19,000 members and is continuing to grow. Most port-based or coastal maritime activity, as well as the British Waterways canals, are all organised by Unite which by virtue of its dominance in this sector is actually the biggest maritime union in British waters, uniting masters and ratings. Unite has members who are tug boat operatives and masters in companies like Svitzer. Unite also organises ferries in Scotland, Liverpool and Southampton, dredging companies and a host of port related maritime activity. Of particular relevance to this consultation Unite has members in Svitzer, Milford Haven Port Authority and Newport Stevedore. Therefore Unite is pleased to submit a response to the Welsh AVairs Select Committee on its inquiry into ports in Wales.

Milford Haven Port Authority Unite believes that Trust Ports in Wales like Milford Haven Port should be about creating new and improved port infrastructure and facilities to benefit the economy locally and nationally, which is the aim in other countries; not simply as a mechanism used to remove Trust Port assets from public ownership. The wider purpose of seaports in facilitating trade and generating economic and social benefits is best stressed by public-owned Trust Ports like it is in other countries. Unite does not believe there is evidence that Trust Ports like Milford Haven Port should go into private ownership and never believes there will be. Processed: 29-10-2009 23:00:05 Page Layout: COENEW [E] PPSysB Job: 435922 Unit: PAG7

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Milford Haven Port Authority plays a very important role in the local community, not just through employment but in other social areas as well. Unite believe that it is of the utmost importance that it remains in the control of the Government and any threat to privatise or sell of any part of it will be resisted as vigorously as possible. A great deal of the shipping that comes into Milford Haven Port is naturally coming to the refineries and is now coming to the LNG sites as well. Due to this Milford Haven Port Authority are performing well in these diYcult times and there should be no question of any short time working or of any lay oVs, which we have seen elsewhere.

Holyhead There is the potential to increase the amount of cruise liners at Holyhead. However at the moment Holyhead is at a disadvantage because cruise liners can’t disembark at the port side. Unite believes that this should be urgently rectified to allow Holyhead to have a better opportunity to compete with other ports in this regard.

Transport Infrastructure The Government has a fundamental responsibility to the transport infrastructure for UK major roads, railways and rivers and canals. Its responsibility lies not only in the renewal and, where required, the expansion of this infrastructure, but also in ensuring that the freight that moves on it can do so easily,quickly and in a sustainable way. The road services in West Wales needs improving and although progress is being made to the A40 and the A477 to Pembroke Dock there is still a lot more that needs to be done. Unite believe that Pembroke would benefit greatly from improvements in the infrastructure through increased tourism. Although Unite does accept that some would argue that it is attractive due to its rural nature and because it is not overdeveloped. The A55 to Holyhead should take about 2.5 hours from mid Wales however whilst improvements are being made it is taking more like 4.5 hours. This type of delay and inconvenience is aVecting freight transport routes to and from ports and in Wales. Therefore, the Government should develop an integrated freight plan as a matter of urgency for Wales to put right these problems.

Environmental Concerns—Rising Sea Levels A rise in sea levels and other changes fuelled by global warming threaten roads, rail lines, ports, airports and other important infrastructure in the UK but particularly in Wales. A new study is to consider whether Welsh coastal towns may simply have to be abandoned in the face of rising sea levels. With scientists predicting sea levels will rise by about a metre by the end of the century, the Assembly-backed study will consider how viable it will be for people to go on living along the coast. The study will focus on Pwllheli, in North Wales, and Barry, in the Vale of Glamorgan, and assess whether in the long term it is worth improving their sea defences to avoid scenes like those predicted by Lord Byron. But experts have warned it may be time to start thinking the unthinkable—that they simply have to be given up to the sea. Both Barry and Pwllheli experienced severe flooding in 2000 and the study will also examine the more immediate question of how this can be prevented in future.

So what can ports and terminals in Wales do to significantly improve their environmental profile? Sources of Air Pollution in Ports: — ships movements and alongside, on own power; — port activity—cargo handling, etc; — port/cargo-related transportation; — port/cargo-related process & storage industry; — distribution transportation; lorries and trains; and — intra-port traYc, including tugs, patrol/pilot boats.

Types of Air Pollution in Ports: Air Pollution in Ports areas arises principally from: — diesel engines and other combustion processes involving fossil fuels;

— carbon dioxide—CO2;

— particulates PM10, etc; — hydrocarbons—HC;

— oxides of nitrogen—NOx; and

— sulphur products—SOx. But other pollutants may also be present: Chemical vapours/gases from industrial processes. Processed: 29-10-2009 23:00:05 Page Layout: COENEW [O] PPSysB Job: 435922 Unit: PAG7

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“Cold Ironing” The solution or merely a panacea?: — “Shore power” is nothing new—NATO and former Warsaw pact navies have used standard equipment in all major naval bases, for over 40 years. — 440V, 3 phase, 3 wire, 60 Hz. — Standard bolted connections to cables. — For merchant ships, the lack of world-wide class standards for power systems creates diYculty in providing shore power to a wide variety of ships, — “Cold-Ironing” is a way towards reducing emissions of ships in port but: — it is more suitable for longer-term turn-around visits, especially where dedicated berths are provided to one company or class of ships; and — the environmental benefits are largely localised, rather than total.

Other means of reducing pollutants while Alongside: — Shore-side diesel generators—better matched to load, so lower “signature” but still producing key pollutants. — Shore-side LPG powered generators—successful Pacific Gas and Electric Company trials in Oakland, USA, July 2007: Better but still not “Carbon- Neutral”. — Shore power will not always be possible, so we should identify other areas of sea and port activity, in which “oVset” or other benefits can be obtained.

Cargo-Handling: — “Specific Power” (power needed to move 1 tonne of cargo 1Km) reduces as ships’ sizes increase. — Do ports need to invest in dredged access and cargo handling facilities for the largest container and bulk vessels? — Increased Vessel Productivity to Reduce Time in Port—Double-Cycling and Twin/Tandem Picks for Quay Cranes.

Container Yard: — Double-cycling of yard tractors. — Quay crane double-cycling. — Yard tractor double-cycling. — Pooling of tractors serving groups of quay cranes. — Intelligent route planning: Minimization of travelling distance yields increased productivity and reduced fuel consumption. — Storage buVers at on-dock rail yards. — Depending on terminal layout and the type of lift and transport equipment used, the benefit of double-cycling on a long drayage route may oVset any extra lifts in a grounded buVer area. — Enables double-cycling of dray vehicles.

Port transportation: — Cranes/container movers increasingly electrically driven. — Trucks, etc. likely to remain fossil-fuel powered but Euro 4/Tier III engines available (reduced PM10s, HCs and Nox) Currently these are all typically powered by diesel fuel.

Port-based process and storage facilities: — Not only economic sense (adding value from real estate). — But sound environmental benefits to be gained (reduced transportation: Tonne-Kms).

Port-located power generation: Available industrial land and ports’ permitted development powers lend to: — Wind turbines; — “Biomass”; and — “Waste to power” generating plant. Processed: 29-10-2009 23:00:05 Page Layout: COENEW [E] PPSysB Job: 435922 Unit: PAG7

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Reduce the need for cargo onward double transportation?: — Ports should be developed with adjacent space for distribution facilities serving local markets. — This needs Government understanding, recognition and support for planning, at both UK and local levels.

Co-Located Ports and Distribution Parks?: — Combination of port adjacent to major distribution park. — Typical of the European model but less usual in the UK.

Look to new technology to provide low-emission vessels for port: activity — Seek eYcient, modern tugs, running on low-sulphur MGO? — Encourage intra-port cargo services to renew their fleets or upgrade propulsion machinery to Euro IV/Tier III standards? — Operate low-emissions pilotage and patrol vessels?

Outside Lorries: — Reduce the number of truck visits for a given throughput. — Enable trucks to perform two transactions per port visit. — Web-enabled dispatch/container move matching systems. — Virtual container yard (reduces empty re-position moves)—Reduce gate process time and queuing/ idling time. — Web-based pre-process and pre-advise. — Optical Character Recognition (OCR). — RFID tagging of trucks—spread the workload to the container yard. — Extend gate (and yard crane) hours. — Increase average truck travel speed on the road. — Appointments aimed at avoiding congestion hours. May 2009

Written evidence from the Welsh Assembly Government Introduction 1. Ports form a vital part of the economic and transport infrastructure of Wales. They act as economic drivers, attracting and supporting a wide range of business activity. Ports are also transport interchanges, providing a gateway to the worldwide distribution network in an increasingly globalised economy. 2. Wales is well endowed with ports. The ABP-owned ports in South Wales, at Newport, CardiV, Barry, Port Talbot and Swansea, handle a wide range of cargoes from raw materials through to containers. In South West Wales, Milford Haven handles mainly petroleum products and, more recently, Liquified Natural Gas (LNG). In the north east, the Port of Mostyn handles general cargo, specialist equipment for renewable energy and the Airbus A380 wing-sets manufactured at Broughton. Wales also has three ferry ports with services to Ireland, namely Pembroke Dock, Fishguard and Holyhead. 3. There are numerous small ports around the Welsh coastline. These can play an important role in local economies, for example, in supporting specialised trade flows (such as aggregates or slate products) or the fishing industry. Small ports also provide leisure facilities, such as marina and related housing developments, which are integral to many coastal tourist economies.

Policy Framework 4. Ports policy for Wales, other than for small fishery harbours, is reserved to the UK Government. Although this is a non-devolved area, the Assembly Government sees its role as putting in place the right strategic framework to allow Welsh ports to realise their full potential. It has made it a priority to ensure that the linkage between ports and the economy is reflected in its wider economic development and transport policies. 5. As part of this work, transport planning arrangements in Wales have been overhauled following enactment of the Transport (Wales) Act 2006. The Act imposes a requirement on the Assembly Government to prepare and publish a Wales Transport Strategy setting out its vision for the transport system. The Processed: 29-10-2009 23:00:05 Page Layout: COENEW [O] PPSysB Job: 435922 Unit: PAG7

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Strategy, together with the closely-related Wales Freight Strategy, was published in 2008. It will be implemented by a National Transport Plan and four Regional Transport Plans, which will be published later in 2009. 6. To ensure that policy reflects the needs of the freight industry in Wales, including ports, a Wales Freight Group was established in 2006. More recently, a Wales Ports Association has been established as a sub- group, to focus exclusively on ports issues.

Co-operation and Co-ordination with the UK Government 7. The Assembly Government works closely with the UK Government on ports issues. A good example is the ports policy review undertaken by the UK Government between 2005 and 2007. The Assembly Government was represented on the Project Board for the review. The UK Government and the Assembly Government worked together to hold a joint stakeholder consultation event in CardiV. 8. Similarly, the Assembly Government is liaising with the UK Government on the National Policy Statement on ports, which will set out the UK Government’s policy for the future development of civilian sea ports in England and Wales. The National Policy Statement will provide the primary basis for decisions by the Infrastructure Planning Commission in relation to proposals for major port developments in England and Wales.

Surface Access to Ports 9. In recent years, the Assembly Government has undertaken a number of schemes which will help to improve surface access to Welsh ports. These include improvements to the A477 in Pembrokeshire and the completion of the dualling of the A55 across Anglesey. The Assembly Government has also supported a number of local road schemes that have improved access to ports, including the Southern Distributor Road in Newport. 10. The current trunk road forward programme, announced by the Deputy First Minister in December 2008, includes a number of schemes which will further enhance port access. In south west Wales these include the upgrading of the A40 between St Clears and Haverfordwest, which will facilitate access to the ferry port at Fishguard, as well as further improvements to the A477 between St Clears and Red Roses. 11. In north Wales, the programme includes a number of schemes to improve the A494 and A55. In addition, the Assembly Government is considering the future of the Britannia Bridge, which links the Isle of Anglesey to the mainland. The bridge carries only one lane of traYc in each direction and represents a capacity pinch-point on the A55, which is otherwise of dual carriageway standard. Work is currently being undertaken to consider the technical and environmental issues associated with a new bridge. 12. The Assembly Government is also supporting a scheme being developed by the Isle of Anglesey Council to improve access into the Port of Holyhead. 13. The Assembly Government is keen to improve rail access to ports and to encourage the transfer of freight from road to rail. A Freight Facilities Grant scheme has supported rail freight handling facilities at the ports of Newport, CardiV and Swansea. The Assembly Government is also keen to encourage the development of coastal feeder services for container traYc, which should also have environmental benefits.

Potential to Increase the Scale and Range of Trade 14. As noted above, Welsh ports handle a wide range of cargoes, from raw materials through to container traYc. The degree of diversification varies considerably from port to port. Shipping is a highly competitive, globalised industry and the pattern of services is determined by market demand. 15. The Assembly Government is aware of a number of changes in supply-chain and distribution practices that could provide opportunities for Welsh ports. This includes the increasing use of feeder ships to tranship containers from the major hub ports, as well as the scope to transfer long-haul freight movements from the Iberian peninsula from road to sea. These developments have the scope to facilitate a significant reduction in transport-related carbon emissions.

Ferries 16. As noted above, Wales has three ferry ports, at Pembroke Dock, Fishguard and Holyhead. These ports have a major strategic role, linking Ireland, Great Britain and mainland Europe, which is recognised by their inclusion within the Trans-European Transport Network. Both the ferries and the ports themselves have been upgraded in recent years, reflecting the significant growth in freight traYc across the Irish Sea. 17. The Assembly Government has also been working with stakeholders to facilitate the resumption of the ferry service between Swansea and Cork, which provided a valuable link between South Wales and the Cork and Kerry region. The service was withdrawn at the end of the 2006 season. Processed: 29-10-2009 23:00:05 Page Layout: COENEW [E] PPSysB Job: 435922 Unit: PAG7

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Cruise Ships 18. The Assembly Government is keen to ensure that port facilities are suitable for the rapidly growing cruise market, given the potential tourism benefits. A number of Welsh ports have attracted cruise operators, including Newport, CardiV, Swansea, Milford Haven and Holyhead. A “Cruise Wales” partnership, involving key stakeholders, has been established to market Wales as a tourist destination and to facilitate the upgrading of facilities where appropriate. 19. At Holyhead, an assessment is currently being undertaken of the feasibility of creating “alongside” berthing facilities for cruise ships, based on the adaptation of an existing jetty owned by Anglesey Aluminium. If the berth is developed, it will avoid the use of “lighters” to oZoad passengers, greatly enhancing the attractiveness of Holyhead for cruise ships. There is an informal agreement in place to carry out a series of berthing trials at the existing jetty during 2009 and 2010. 20. At Milford Haven, the Blackridge site is currently being considered for development, including the construction of a dedicated cruise berth.

Security and Policing Provision 21. The Assembly Government is keen to enhance the safety and security of the transport network in Wales. Although the maritime security regime and policing are non-devolved areas, we will continue to work with the UK Government to ensure that there is adequate security and policing provision at Welsh ports. June 2009

Written evidence from Neath Port Talbot County Borough Council The current port facilities within Neath Port Talbot consist of the Tidal Harbour, one of only four ports in the UK that can take vessels up to 180,000 dwt, Port Talbot Docks which can accommodate vessels up to 8,000 dwt and the Port of Neath which can currently accommodate vehicles up to 4,000 dwt but has plans to increase its capacity. In terms of the amount of cargo handled by these facilities, during 2007 imports into Port Talbot were 8.8 million tonnes with exports of 321,000 tonnes and in the Port of Neath in a similar period over 390,000 tonnes of cargo were moved. Across all facilities the types of cargo varied from iron ore and processed slag to animal feed and sand. In terms of employment ABP quote direct employees for Swansea and Port Talbot at 41 with an indeterminate number of people in associated businesses reliant on the port within their 37 tenants at Port Talbot and the U.K. dredging subsidiary of ABP. Port of Neath has 136 persons directly employed in maintaining and handling cargoes through the port with a further 50 employees in a manufacturing company based in Neath relying totally on cargos generated through the port. It can be seen from the above that the contribution of these facilities to the economic prosperity of the Neath Port Talbot and wider Swansea Bay area is vital. In current times with a general reduction in trade all support must be given to ensure these facilities are still fit for purpose following the economic recovery. In relation to planning policy the following has been developed by Neath Port Talbot County Borough Council and is quoted. Town and Country Planning Policy through the Unitary Development Plan promotes development that would enhance their function and protects them and their access infrastructure (road and rail) from development that would adversely aVect them. This reflects one of the strategic policies: to encourage the movement of freight by rail and sea as an alternative to road.

Policy T6: 12.10 POLICY T6—PORTS AND HARBOURS Proposals that would prejudice the potential use of harbours, docks and wharfs for freight movement (including access by water, rail and road) will be resisted. The retention and enhancement of the cargo handling, storage, access (by rail and road) and related facilities will be supported provided no unacceptable impacts would be created. 12.10.1 The Port Talbot Tidal Harbour, Port Talbot Docks and the River Neath wharves represent major freight facilities. The three facilities within the County Borough each serve very diVerent forms of shipping. While the tidal harbour can accommodate ships of up to 180,000 tonnes, the town docks can accommodate general cargo vessels of up to 8,000 tonnes and the tidal River Neath wharf ships of up to 4,000 tonnes. All three oVer the potential for increased and more varied use and this could both reduce freight movements on land and encourage port-related industries. 12.10.2 Access to each of them by road is somewhat tortuous. The construction of the Peripheral Distributor Road (PDR) between the Dock gates and the M4 junctions 38 at Margam and 41A at Baglan will help provide a modern access which will reduce traYc impacts upon the town of Port Talbot. Processed: 29-10-2009 23:00:05 Page Layout: COENEW [O] PPSysB Job: 435922 Unit: PAG7

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12.10.3 As a result of their coastal location, particular care will be needed when preparing and considering proposals for extensions to the ports and harbours to ensure that seascape, landscape and biodiversity interests both on and oV shore are safeguarded. Other policies and the allocation of new land uses protect port facilities and activities from encroachment by sensitive uses that could constrain port activities. In response to the need to address climate change and secure economic benefits that could accrue through increased use of the ports, the preparation of the Local Development Plan will examine the potential to increase the scale and range of trade both through coastal shipping within the UK and with other countries. The County Borough Council is currently preparing Supplementary Planning Guidance on the Central Area of Port Talbot which includes the town Docks. This builds upon the potential identified in the UDP for the comprehensive regeneration of the area and its role in reinvigorating the town of Port Talbot. This could involve a range of housing, employment, retail, education, leisure and entertainment in waterside locations. The emerging master-plan will take full account of the need to protect the potential of the commercial port. Neath Port Talbot as part of the SWWITCH Consortium fully support the evidence submitted by the Transport Consortium. Within Neath Port Talbot Community Plan sea freight is identified as an important element with targets and monitoring of usage highlighted. Within NPT progress report for 08/09 the issue of the decline in tonnage moved through the facilities is recognised and reflected in the actual tonnages moved in relation to the targets set against the baseline in 2004–05 prior to current economic diYculties. Neath Port Talbot has recognised the importance of good infrastructure to the sustainability of the ports. We continue to promote completion of the Peripheral Distributor Road which will provide better access for Port Talbot Deep Water Harbour and Docks along with establishing a better link through to the Baglan Energy Park and the adjacent Wharfage at Port of Neath. This piece of infrastructure is seen as a major element of support to these facilities and it is pleasing to see in the recently produced National Transport Plan the Distributor Road mentioned by the Welsh Assembly Government as one of the major unitary authority provided infrastructure projects to which WAG give ongoing support. The Council’s vision for Port Talbot is of an area which plays a significant role as a focus for economic and environmental regeneration and as a growth point for the development of Port Talbot and the wider Neath Port Talbot waterfront area. As such the draft master plan supplementary planning guidance for central Port Talbot including Port Talbot Docks was put out to consultation following a public exhibition in March 2009 with the period for public consultation ending on the 19fh June. This approach and the extent of the master plan acknowledges the inter dependency of Port Talbot and the Dock area and addresses the interface between the two looking to the future development of the area to not only develop Port Talbot Town Centre but also Port Talbot Docks. Neath Port Talbot as stated previously fully endorse the evidence supplied through the SWWITCH Consortium and from the above it is evidenced that the Authority is actively engaging in the delivery of infrastructure and regeneration to underline the importance in maintaining the port facilities in this area. July 2009

Written evidence from Liverpool City Council City of Liverpool Cruise Liner Terminal Synopsis June 2009 The City of Liverpool Cruise Liner Terminal opened in September 2007. It is owned and managed by Liverpool City Council. The project was led throughout by Liverpool City Council with key partner input from Peel Ports and others. Total project cost was in the region of £20 million with funding provided by the North West Development Agency, The Objective One ERDF Programme through Government OYce North West, City Focus SRB and Mersey Waterfront Regional Park. Mersey Docks & Harbour Company who became Peel Ports made a contribution to the capital scheme which improved Irish Sea Ferry operations. The project was delivered in three stages: — initial feasibility work; — pursuit of statutory permissions and funding applications; and — legal arrangements and construction. Processed: 29-10-2009 23:00:05 Page Layout: COENEW [E] PPSysB Job: 435922 Unit: PAG7

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From initial conception to opening the project took about seven years. The terminal is performing well and receiving more vessels and higher visitor numbers than anticipated. See www.liverpool.gov.uk June 2009

Supplementary written evidence from Pembrokeshire County Council Planning for Port Development in Pembrokeshire 1.1 The planning of port developments in the County has been influenced by a wide range of factors including government policies, local planning policies, regeneration plans, market forces and the aspirations of land owners. 1.2 In Pembrokeshire, the UK Government has been instrumental in determining the development of oil refineries and power stations along the Milford Haven Waterway through various Acts of Parliament (including the Electricity Act) and in the “national interest”. 1.3 European and UK government decisions in respect of the fishing industry have had considerable impact on activity at Milford Docks. 1.4 The closure of Ministry of Defence bases at Pembroke Dock and Trecwn have had consequential impacts on port operations and the availability of sites and premises in key waterfront locations. 1.5 The Government’s designation of Enterprise Zone sites around the Milford Haven Waterway 1984–94 provided a catalyst for the redevelopment of waterfront sites at Milford Haven, Neyland and Pembroke Dock at a time of major defence and energy plant closures. 1.6 More recently the Welsh Assembly Government’s support for a regeneration initiative at Fishguard in 2003 has highlighted an opportunity to combine a new marina development with port infrastructure improvements, to mutual potential benefit. 1.7 Current Local Planning Policies recognise the importance of the County’s coastal environment, deep water and strategic location in terms of port developments and links to Ireland. A summary and relevant extracts from the current Joint Unitary Development Plan is attached as Annex 1.44 1.8 A new Local Development Plan is under preparation for the period 2011 to 2021. The proposed vision for the County acknowledges the importance of maritime access, agriculture, international energy and tourism as the basis for a prosperous local economy. 1.9 The Council considers that diversification of port facilities for leisure related use is appropriate where there is clear evidence that this will not prejudice port operations. 1.10 Marine leisure is considered to be a high value diversification activity and Pembrokeshire is a strategic location for UK coastal cruising and as a centre for a range of water sports. 1.11 In Milford Haven marine leisure has replaced declining fishing port activities, in Fishguard there is an opportunity to expand the operational area of the port through the use of dredging from a proposed new marina. In Pembroke Dock a proposed mixed use housing and marina facility may incorporate a new cruise liner berth. 1.12 Developable waterfront land is a valuable and generally diminishing resource and decisions need to be taken in the context of long term needs and opportunities. 1.13 The emerging Local Development Plan has a range of candidate sites which will be the subject of public consultation including strategic waterfront sites. 1.14 The provision of new port and supporting transport infrastructure is expensive and may require public sector support. June 2009

Supplementary written evidence from Pembrokeshire County Council Enterprise Zone Designation—Supplementary Evidence As part of Pembrokeshire County Council’s submission to the Welsh AVairs Select Committee we identified Enterprise Zone designation as a potential stimulus to new investment in port related development. Whilst this point was not pursued during the oral evidence session we feel that Enterprise Zone designation at key sites in Pembrokeshire would help to address infrastructure shortcomings and stimulate private sector investment.

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Background 13 sites were designated between 1984\–994 as Enterprise Zones on land adjoining or close to the Milford Haven Waterway. The benefits of Enterprise Zone designation were additional financial incentives and reduced bureaucracy to encourage new investment. A list of the benefits which were available in 1984-1994 is attached as Annex 1.45 Of particular interest in the port context is the provision for priority consideration of applications for customs facilities such as “inward processing relief” and customs warehouses.

Past Impacts The practical aVect of Enterprise Zone designation on port related activity was as follows: Milford Docks—this rundown fishing harbour was the subject of a comprehensive redevelopment plan which attracted public and private sector funding to improve the Docks infrastructure, develop a new marina, update fishing facilities, restore redundant buildings and develop new mixed use quay-side buildings; Neyland Quay—this derelict port was the subject of land reclamation and new public and private sector investment to provide a marina, new fishing and marine leisure service support facilities; and Pembroke Royal Dockyard—this redundant admiralty Dockyard was in a derelict condition. Enterprise Zone designation was the catalyst for private sector land assembly, the construction of new deep water quays and the refurbishment of derelict historic buildings. This new port facility provided a valuable role in servicing recent energy developments along the Milford Haven Waterway.

Future Opportunities There are a number of candidate port related sites for Enterprise Zone designation. Milford Haven—The Port Authority has ambitious plans for a mixed use expansion of the existing Dock facilities including cruise liner berthing. Black Bridge Site—Partially owned by Pembrokeshire County Council, this is probably the last remaining strategic site on the Milford Haven waterway with deepwater potential and a wider “national interest” role. Pembroke Dockyard—comprising the existing operational land and additional land recently acquired by Milford Haven Port Authority from the Ministry of Defence this large site has significant development potential including service support for the energy sector. Fishguard Harbour—Privately owned, significant port improvement works are needed. An opportunity also exists to facilitate a strategic all-tide marina development to provide support facilities and a safe haven to service Cardigan Bay and the wider Irish Sea.

Conclusion Private sector investment in more peripheral areas like Pembrokeshire is diYcult to attract because of lower returns on investment resulting from the additional distance to markets and generally a lower quality infrastructure. This is evidenced by rental levels which are generally lower than locations further east and similar or in some cases higher building costs. New investment in peripheral areas, particularly in the current economic climate, is likely to require a greater stimulus from the public sector. Welsh Assembly Government priorities appear to be refocused on areas of highest deprivation and there has been a marked reduction in recent funding support for physical regeneration and related infrastructure provision outside of their chosen areas. The County Council believes that the Pembrokeshire ports have potential to help grow local, regional and national economies and would advocate a review of Enterprise Zone designation in the County as an instrument for stimulating private sector investment during a period of public sector funding constraints.

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