If the new owners of P&O can’t run it while paying and treating their staff right… then they can sell it, or close it and let others take the routes. Happy to see it privatised if need be, short term or longer term.
As for some of the other questions… no it’s not “simple” to fix, but the government has many tools it can use to stop this way of doing business. UK law could insist that access to ports requires ships to pay the minimum wage of at least one of the countries on route… or ships don’t get to dock. In effect that would mostly affect to and fro RoRo ferries… but if it also hits some cargo, so be it. I can see many of the countries we share RoRo ferry routes with cooperating with such a scheme to raise standards for staff on those routes.
Anyway, twist it around… how do Brittany Ferries now compete with P&O on UK routes? Allowing P&O’s owners to go for the race to the bottom negatively effects competitors, as well as staff.
No excuses are acceptable from the government. “It’s just how it is”, or “it’s complicated” shouldn’t be swallowed in place of action. They are just excuses to try and hide their acceptance of (if not Britannia Unchained excitement for) low wages, high hours, zero protection work for large “companies” owned by highly dubious wealth holders… sovereign individuals and organisations avoiding any of the social responsibility that should come with having people working for you.
I thought the last sentence of your first paragraph contained an error Kelvin, but then I remembered that P&O Ferries is actually state owned, ie it is owned by the government of Dubai, so perhaps not?
Although as a vital component of the UK's transport infrastructure I would much rather it came under the control of the UK government.
I have no problem with it being state owned as long as it is a state which is accountable to British voters, and not a dictatorship with zero concerns about the consequences of their actions.
how do Brittany Ferries now compete with P&O on UK routes?
Did you ever travel on the routes P&O attempted to directly compete against Brittany on? Portsmouth-le Harve or Santander? Brittany had beautiful, modern ships with great food, cinemas and swimming pools while P&O operated a floating little chef with a wonky video recorder and a closed soft play. Competition was still born. They’ve not directly competed for years.
I thought the last sentence of your first paragraph contained an error Kelvin, but then I remembered that P&O Ferries is actually state owned, ie it is owned by the government of Dubai, so perhaps not?
It was a slip up! I meant nationalised. But your point is a good one anyway.
I don’t hugely care who owns it, but if they can’t run those routes and pay a fair wage to workers that are treated well… then I’d rather someone else took over the company and/or the routes and made it work. Happy for that to be the UK government (again), whether as a temporary bridging arrangement, or long term state control and ownership.
Competition was still born.
Sounds like we might have a candidate company to take over on some of the routes, if P&O aren’t able to run them without resorting to the tactics of this week.
Brittany running a North Sea or North Channel route would be wonderful. It would be crewed entirely by French crew though, so hardly fixes the problem.
People are putting about that Irish ferries compete with a 25% lower operating cost. That’s not really correct. 25% lower staffing cost for junior staff perhaps. Bulk of the cost will be fuel, port fees and the mahoosive mortgage on the ships. Also Pembroke-Rosslare is hardly the same as Cairnryan-Larne.
One thing I've been wondering here given the mention of Indian crews - how do they get here and embark / disembark? Do they need visas that the UK Govt could deny and scupper P&O plans?
I believe crews en-route to their vessel are largely exempt from the visa system. So fly in, bussed to ship.
Plus, Irish ferries have only been operating 1 boat Dover-Calais for less than a year (recently added another).
I'll ask again, as I still don't understand, and no one seems to be able to either. How were P&O able to move RMT members' contracts offshore? Where the union when this was going on?
I believe crews en-route to their vessel are largely exempt from the visa system. So fly in, bussed to ship.
Sorry - should have been more specific with the Q. I believe that's the case for vessels which go between UK and non UK destinations. It is the Irish Sea ones I don't understand as I thought you needed a work permit to operate on vessels running entirely in UK waters.
The Trade Union and Labour Relations (Consolidation) Act 1992 was amended by statutory instrument in February 2018.
The change signed off by Mr Grayling states: "[If] the employees concerned are members of the crew of a seagoing vessel which is registered at a port outside Great Britain...the employer shall give the notification required...to the competent authority of the state where the vessel is registered (instead of to the Secretary of State)."
The amendment is the only change to the 1992 Act relating specifically to foreign-registered ships.
The memorandum states no formal consultation was carried out before the change was made, and no impact assessment was carried out.
Remind me what prompted this increased used of statutory instruments by ministers to update regulations without bothering parliament or publishing impact assessments...
I’m sure the speakers did emphasise this but it doesn’t make it true. Company Directors are legally required to operate trading companies as a going concern – if they have any doubts about their ability to do that they are required to register for insolvency.
If P&O was a UK company, then yes this would be correct.
Yeah my heart bleeds for the poor Middle Eastern dictator who only 2 or 3 years bought the company and now needs to sort the consequences of buying a non thriving business.
The business isn't viable regardless of who owns it.
If the new owners of P&O can’t run it while paying and treating their staff right… then they can sell it, or close it and let others take the routes.
Like Irish Ferries who operate in exactly the way you are hitting back at?
UK law could insist that access to ports requires ships to pay the minimum wage of at least one of the countries on route… or ships don’t get to dock.
I'm sure the Filipino crewed fishing boats would welcome this or, more likely, just land more catches in the EU.
In effect that would mostly affect to and fro RoRo ferries… but if it also hits some cargo, so be it.
You seem to be vastly underestimating how much the shipping industry relies on maritime contracts. Your idea would effectively be placing a trade embargo on ourselves!
No excuses are acceptable from the government. “It’s just how it is”, or “it’s complicated” shouldn’t be swallowed in place of action.
Which is how we ended up with Brexit. A simple answer to a complex problem, the unintended consequences of which have only just begun and are already hitting us hard.
I don’t hugely care who owns it, but if they can’t run those routes and pay a fair wage to workers that are treated well… then I’d rather someone else took over the company and/or the routes and made it work.
How? If the route is losing all that money explain how to make it work whilst still being competitive. If you pass the costs on to customers they just take their custom elsewhere.
If they're failing, let them fail, and let someone else run the routes. Breaking P&O into a series of smaller operators wouldn't be the worst thing in the world. If some routes have to be state run (whether that's the UK state of those of other countries on the routes) so be it. I don't care one jot about P&O's current owners... staff, passengers and business customers all matter more to me than DP World.
"If they’re failing, let them fail, and let someone else run the routes."
Like Irish Ferries? Who fired their own staff 17 years ago? They would love that I'm sure.
"If some routes have to be state run (whether that’s the UK state of those of other countries on the routes) so be it"
Because the state has a great record on running complex operations?
https://www.walesonline.co.uk/news/wales-news/dvla-hits-back-claims-staff-23436649
A myriad of other examples are also available...
"Breaking P&O into a series of smaller operators wouldn’t be the worst thing in the world."
Apart from the fact that it's a (very) capital intensive business and doing so would massively ramp up capital finance costs - which then ramps up operating costs - and and as we know, the business is already loss making....
Let them fail. Unlike you I think others could make those RoRo ferry routes work, and still treat staff better, once P&O are out of the way. DP World didn't grow that ferry business, it is the scale it is thanks to the UK state and subsequent owners.
Because the state has a great record on running complex operations?
Ah, now we are getting to the nitty gritty of Cheddar's argument......this is about supporting thatcherite right-wing free market neo-liberalism.
Yeah less state involvement in complex operations such as transport, healthcare, education, etc.
I agree that the whole issue is really ultimately about that.
Johnson has just stood up at PMQ's and said that the government thinks that P&O has broken the law and they fully intend to prosecute them to 'defend the rights of British Workers'
He also said that the government would still work with DP World on freeports.
Somehow Johnson has managed to make his answers on P&O about repeating the claims that Labour would have kept us in permanent lockdown (ignoring that his own Covid measures as PM were only possible with the support of Labour MPs). Also... something about if we'd still been in the EU, they would have stopped the government changing the law in ways that they haven't changed the law... [ couldn't quite follow that one, but I suppose that's deliberate ]
Johnson has just stood up at PMQ’s and said that the government thinks that P&O has broken the law and they fully intend to prosecute them to ‘defend the rights of British Workers’
UK employment protection laws aren't just weak or nonexistent, the consequences of defying them are relatively insignificant.
I am sure the legal advice to DP World will have factored that in.
So I don't particularly doubt that the government intends to prosecute. All the parties concerned know that it will be a fairly pointless exercise.
[ couldn’t quite follow that one, but I suppose that’s deliberate ]
Indeed
As with most things he said, its difficult to argue with as its completely contradictory and makes absolutely no sense whatsoever. Difficult to form a coherent argument against something that is essentially gibberish.
Didn't he just answer that he knew well in advance about P&O's intentions and just let them get on with it, to rebut the suggestion by Starmer that he'd not bothered reading his notes? That apparently being clearly better?
I mean... where do you even begin forming an argument against that? I did like his reference to it as 'half-arsed bluster'
Didn’t he just answer that he knew well in advance about P&O’s intentions and just let them get on with it, to rebut the suggestion by Starmer that he’d not bothered reading his notes?
No, I don't thing so... he glossed over the fact that the government (including his own team) knew in advance, by claiming that he didn't personally know anything about it (part time PM excuse).
All the parties concerned know that it will be a fairly pointless exercise.
Absolutely this. The PM gets to signal that they're "doing something", without actually doing anything to improve employment law (including undoing their own changes that may have enabled P&O to claim a legal basis for avoiding the 45 day rule), or affect D P World's business model, or stop the UK freeport opportunities for D P World.
I knew it made no sense. I couldn't possibly have known about it in advance as that would have involved me actually doing my job! So there!
As defences go, its not really the best, is it?
Cheered to the rafters by the morons sat behind him though
Let them fail. Unlike you I think others could make those RoRo ferry routes work, and still treat staff better
This isn't even a case of 'profits are down' (but still making profit), the routes are running at a loss. If this is the case today then I have no idea how you think it wouldn't be the case tomorrow.
Like I said, your ideals are laudable but you are trying to hold out a race to the bottom that their competitors started years ago. That ship has sailed long, long ago. It's utterly crap but I really have no idea how we can legislate against it or compete with foreign operators on such an uneven playing field.
I don’t care one jot about P&O’s current owners
I should probably make myself clear here, I couldn't care less either. I've done my time working for their like and as far as I'm concerned the whole shipping industry is a shady pile of shit.
their competitors started years ago
They hardly have any competitors for RoRo, as they are operating an established ex-public sector monopoly on many of their short UK routes. Where others are running short RoRo routes including the UK, they should also have to follow any new employment obligations placed on P&O, I'm not suggesting a special case is made of P&O. As should anyone taking on routes P&O say they can't run long term without trashing employment rates and conditions (I don't believe D P World on this, as it happens).
If this is the case today then I have no idea how you think it wouldn’t be the case tomorrow.
Because 2020/21 figures do not represent future trading conditions. For obvious reasons covered well in this thread.
This isn’t even a case of ‘profits are down’ (but still making profit), the routes are running at a loss.
I would like a more forensic investigation into the P&O accounts, and whether they just offshore the profits to the parent company for tax reasons, rather than just accepting their word that that is the case.
After all do we have any evidence of honesty and integrity from their actions?
Because the state has a great record on running complex operations?
Yes, it does. Often it has to intervene to sort out the mess made by the private sector.
Because 2020/21 figures do not represent future trading conditions. For obvious reasons covered well in this thread.
I was under the impression this was over several years as discussed earlier in the thread. That said...
I would like a more forensic investigation into the P&O accounts, and whether they just offshore the profits to the parent company for tax reasons, rather than just accepting their word that that is the case.
After all do we have any evidence of honesty and integrity from their actions?
...this is a fair point.
Yes, it does. Often it has to intervene to sort out the mess made by the private sector.
👍 How many times have we done the ECML hokey cokey?
I would like a more forensic investigation into the P&O accounts, and whether they just offshore the profits to the parent company for tax reasons, rather than just accepting their word that that is the case.
"P&O Ferries has delivered a robust performance in recent years and we aim to drive further value through increasing efficiencies and offering value-added solutions to our customers.
Overall the transaction offers compelling value strategically and financially, and we look forward to P&O Ferries contributing to driving shareholder value in the coming years."
Said Sultan Ahmed Bin Sulayem at the time he bought the company barely 3 years ago.
So he bought a thriving company which was "compelling value" and had "delivered a robust performance in recent years", but 3 years later under his ownership it's skint.
Suspicious or what?
Or do you think he's kicking himself at his apparent bad luck?
Edit :And apparently it's not because of the global travel restricting covid 19 pandemic but because crews were receiving generous and unsustainable wages of over £1.80 an hour.
👍 How many times have we done the ECML hokey cokey?
Well, quite. And for all its faults, do we really want the NHS to be privatised? Organisations don't get much more complex than that...
but 3 years later under his ownership it’s skint.
Covid and Brexit, Ernie. We've been politely trying to get the message across for 11 pages now.
Yeah like the Covid pandemic brexit was unexpected, despite the fact that Sultan Ahmed Bin Sulayem bought P&O Ferries 3 years after the referendum. Or perhaps his business advisors hadn't foreseen the consequences of brexit? They should have looked at STW and they would have been better informed.
But you keep making excuses for P&O's callous treatment of its employees, after all they are embracing the principles behind free movement...... moving in cheap Labour from elsewhere is such a good idea. As long as it provides you with cheap services and produce and doesn't affect the income of the affluent middle-classes.
But you keep making excuses for P&O’s callous treatment of its employees, after all they are embracing the principles behind free movement…… moving in cheap Labour from elsewhere is such a good idea. As long as it provides you with cheap services and produce and doesn’t affect the income of the affluent middle-classes.
I don't think anyone is excusing it, I'm certainly not, but you can't look at these things in isolation.
Blaming Covid and brexit certainly suggests making excuses. Whilst the devastating effect on global travel caused by the Covid pandemic might not have been predictable 3 years ago the idea that the pandemic is permanent issue is ridiculous. Do you expect UK airlines to also sack staff and replace them with extraordinarily cheap labour from the other side of the world because of how much they have suffered financially from the pandemic?
Brexit was a well established fact when Sultan Ahmed Bin Sulayem bought P&O Ferries, are you seriously suggesting that it caught him by surprise? Or are you suggesting that he paid millions for a company whose future was far from certain because of some philanthropic
desire to help people cross seas?
When he bought the company the Sultan said: "overall the transaction offers compelling value strategically and financially". Who told him that and why hadn't they heard about brexit?
Blaming Covid and brexit certainly suggests making excuses.
Are they not the main reasons for recent poor trade in the ferry business?
I’d have thought the lifting of Covid restrictions means pent up demand should make future trading years profitable again.
Brexit has a long term effect, but nothing that mandates shifting to low pay. That’s a choice. One the government should remove from P&O and other short trip ferry operators.
D P World would have found an excuse to change how they employ people anyway. It’s how they work. And this government would happily help, while crying crocodile tears and tub thumping about legal action. And carry on working with them on tax avoiding freeports.
Brexit was a well established fact when Sultan Ahmed Bin Sulayem bought P&O Ferries
The hard nature of it wasn't. The deal was signed a few days before Christmas and came into force on 31/01/2020. In 2018/19 the UK government was being very coy about just how hard the Brexit would be. Did you get what you voted for or something a whole lot harder and more damaging?
Blaming Covid and brexit certainly suggests making excuses
A 17% reduction in trucks and a decimation of the car traffic as I've already posted with a link to Dover Port stats isn't an excuse it's a drop in traffic enough to turn profit into loss.
The hard nature of it wasn’t.
I thought it was all bleeding obvious and only a moron wouldn't understand the consequences of brexit? It turns out that it wasn't that obvious to Sultan Ahmed Bin Sulayem's business and financial advisors.
What about increased competition from air travel in the last few years, hasn't the new kid on the block Wizz Air, which incidentally has offered employment to sacked P&O employees, not had any effect?
And what would have happened to P&O Ferries if unlike other countries such as France the UK didn't have pisspoor employment protection laws? Should we be thanking the Tories and New Labour for saving P&O Ferries?
Btw DP World are so skint that they can't pay the £146m they owe the seafarers pension fund and British taxpayers might have to pay it for them. But strangely enough they have enough money to spunk £100m sponsoring golf.
The Hull-Rotterdam route is back up and running. Pride of Hull left Hull @20:00 tonight presumably with her new crew.
“Are you in this mess because you don’t know what you are doing, or are you just a shameless criminal?”
Both? He knows his (parent) company can afford to break the law, and has the ear of government to help reduce the impact on them of breaking the law.
There is still plenty of trade with the EU taking place, regardless of Brexit:
From 2019-2020 the truck volumes through Dover didn't drop that much (we've already covered this). 2020 - the passenger numbers bombed in Dover and Hull, but I think they will recover this summer, assuming no CV19 disasters.
What has changed is Irish trucks to the EU now going direct, rather than through the UK.
Why P&O are making such a mess of this, I really don't know. It seems like they're applying an operating model from commercial shipping to Ferries. They're alienating everyone, just to save a few quid in the short term. Why not come up with a better strategy to recover the passenger volumes after Covid? Surely that would give enough revenue to cover their wage bill 'as-is'.
Well, would you believe it… the original changes to regulations to allow the fire and rehire ferry workers on cheaper contracts came from the nasty Tories Labour:
https://www.theguardian.com/politics/2003/jun/14/uk.tradeunions
“ 'The issue has even touched Cherie Blair, who 18 months ago launched the £90m luxury cruise ferry, the Pride of Hull, for P & O North Sea Ferries Hull-Rotterdam run.
The boat replaced an all-British crew ferry, the Norsea, with one employing Filipino labour in the engine room at little more than £2 an hour for a 192 hour month.'”
