Ship firms shun UK over lighthouse charges

Click to follow
The Independent Online

More than £70m worth of extra taxes imposed by Britain on some of the world's biggest shipping lines are making UK manufacturers increasingly uncompetitive, according to a report published yesterday.

More than £70m worth of extra taxes imposed by Britain on some of the world's biggest shipping lines are making UK manufacturers increasingly uncompetitive, according to a report published yesterday.

Charges levied on the shipping companies for maintaining lighthouses and other navigational aids are damaging Britain's trading position, the paper says.

Prepared for shipping lines, the report points out that all other European Union countries, except Ireland and Greece, pay for navigational aid out of taxation.

The charges mean that large container vessels operated by big companies such as P&O Nedlloyd, NYK and Maersk are increasingly avoiding British ports in favour of the Continent.

Southampton, Bristol and Sheerness are losing out to ports such as Hamburg, Rotterdam and Le Havre, the report said.

Car manufacturers in particular are faced with the prospect of exporting vehicles in small ships to the Continent to be loaded on larger vessels for shipment elsewhere.

The Independent Light Dues Forum, made up of the large shipping groups, believes the extra taxation in Britain places an additional 5 to 6 per cent on cost.

Until recently shipping companies had absorbed the cost, but they are encountering greater competition from operators in emerging markets that have considerably lower costs.

If the extra charges are simply passed on to UK-based manufacturers they are more likely to shift capital investment to the Continent. While Britain has enjoyed the lion's share of Japanese inward investment, that could be affected by the imposition of Light Dues, it is argued.

The Forum has submitted its views to the Government, which is undertaking a review of the costs of 1,268 navigational aids, including 350 lights, 690 buoys and 220 beacons.

The report says: "The container consortia are constantly reviewing their call patterns and it is clear that an obvious candidate for review is the UK call as, except on certain routes, the proportion of cargo to be discharged at a British port is lower than that at the main European port of call."

The economic study by Graham Rabbitts, an economic consultant to the shipping industry, says that merchant vessel owners pay £71m out of the annual £73m cost of navigational aid.

Shipping companies argue that the situation is unfair because most of their fleet are equipped with sophisticated GPS satellite navigation systems, which make them less reliant on lighthouses, buoys and beacons.

Comments