UK shipping register administration needs urgent reform

Industry responds with a report identifying what needs to change


The way the UK shipping register is administrated needs urgent reform or the red ensign will die, industry has warned.

Data emerged early in 2015 showing that the number of ships flying the UK flag has fallen by a third in the last 5 years. Now the industry has responded with a report identifying what needs to change, with a clear message that ‘the status quo is not an option’ if the UK flag is to remain an influential global maritime player.

The report, written by an independent panel of shipping industry leaders at the request of the Maritime and Coastguard Agency calls for a new public corporation to administer the UK ship register and promote the UK as a place to do maritime business around the world.

UK Chamber of Shipping Chief Executive, Guy Platten said:

The UK is entirely reliant on the shipping industry, but the UK flag will die unless substantial reforms are delivered. The UK is a world leader in maritime services, and it has the skill and ingenuity to maintain its position for generations to come – but the days of tinkering with the administrative process are gone. In a fiercely competitive global environment, we now need fundamental change to reverse the decline before it is too late.

“Shipping companies invest heavily in the UK and contribute billions to GDP and the Exchequer. They can choose to do business anywhere in the world and they have the right to strong customer service and a regulator that actively supports them.

“Numerous shipowners around the world have told me that they will join the UK flag if reforms are delivered. It shows there is demand and goodwill, and with the right political will we can make the most of the opportunity.

“Crucially, with the right leadership and ambition, a new public corporation that promotes and administrates the UK flag can be profitable for the government, and deliver substantial economic growth to UK PLC.

“We know that the Shipping Minister, Robert Goodwill, is ambitious for the industry and the UK as a whole. Our proposed reforms support those ambitions and we stand ready to work with him to deliver upon them.”

Chief Executive of the Port of London Authority and Chairman of the independent panel, Robin Mortimer said:

“A strong UK Flag supports the £10bn UK maritime sector. But in the last few years, the UK has lost over half its global market share. We believe with decisive action the Government can turn this around.

“Our independent report recommends how to achieve this so that by 2020 the UK Flag is seen globally as the quality flag of choice. But without a sense of urgency we fear continuing decline. Industry stands ready to work with the Department for Transport to make change happen as soon as possible.”

The report made a number of key points, saying:

  • Barriers to the attractiveness of the UK Shipping Register are caused both by what it has to offer, and how it is delivered.
  • It is clear that the UK Flag has the capability of competing on quality and cost yet is failing on service levels.
  • There should also be a review of ownership registration criteria with a view to widening the UK’s potential market without reducing the quality of the offer.
  • The Panel recommends that a target of 2% of world tonnage (circa 30m GT based on current world fleet growth forecast) to be under the UK Flag by 2020 and that this percentage of world tonnage should at least be maintained thereafter. The vision is for a marine administration that has a focus on being the flag of choice for quality owners. The Flag will be large, dynamic, international and highly influential.
  • Retaining the status quo model within the MCA is not an option if we, as a strong maritime nation, wish to arrest the absolute and relative decline of tonnage registered to the UK Flag. The Panel has concluded that the UKSR should be established as a separate legal entity, in the form of a public corporation. DfT should commission work immediately to develop the business case in detail for a different UKSR model
  • focussing on a new GovCo as the preferred option
  • and, closely involving HMT and other interested Departments.

You may read the report in full by clicking below:


Source: UK Chamber of Shipping

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