(c) crown copyright Catalogue Reference:CAB/24/251 Image Reference:0044 TjOCUMENT I S TliE PROPERTY OP H I S BRITANNIC MAJESTY^ 250 GOVERNMENT. COPY N O , .26&(34). C A B I THE B R I T I S H DRAFT BRITISH Memorandum 1 (26 my 0 The (34) Cabinet 9) at approved Memorandum (i) "by of That £2 a t h e i r meeting 25th June, and discontinuance year provided subsidy the ( i i ) i s best That grant method Cabinet when the (iv) The the to it and before more about i t in scheme in the should be given to than the should carrying down "be tramp for granted cargoes, applying the incorporating memorandum,, to the B r i t i s h competition a should in assistance on l i n e s be made scrapping that in due grant of a l i n e r s in special for scrapping deal not shipowners cases l a s t grant l i n e r s of prejudiced p a r t i c u l a r appears trades to be the such and a contemplated available building scheme would by scheme be by the the i f used and by industry, preparation to l a i d e assistance, appears concession the assistance shipping cost ships by June subsidies, financial of for assistance of l a i d of 27th Trade 161(34)):­ satisfactory Committee Government ( C P , at foreign financial the proposals foreign special subsidised i f - t h e ( i i i ) in Board bringing consideration subsidies of the aimed produced conditions That by a of to B r i t i s h that BILL, subsidy, of to 1934 MARINE, (ASSISTANCE) of following defensive a SHIPPING President the T, MERCANTILE the millions for N E fighting to with fees any of l e g i s l a t i o n subsidy, cases, building (should as course the and this grant grant of modernising be found referred other the to to of relevant the subsidies financial on condition desirable) In sanction and the memorandum, matters, Subsidy under 2. in respect of the carriage tramp c o n d i t i o n s . In pursuance hes prepared millions to. the scheme w i l l same t i m e necessary 3. the The part of the to now rate in measure to for for House at be months' effort on w i t h my requirements. of compliance absent payment The with the looked for at present the b e t t e r last which g e n e r a l referred which v / i l l shipping fory/ard and t h e p r o p o s a l ton, the consultation entirely a subsidy put per several under which tramp £2 attached a s u b s i d y w h i c h can b e which were of introduced. the Government's for the lay before close the g r e a t e s t subsidy works. organisation from the original y e a r by the tramp of the objection subsidy was at a taken, has disappeared. 4. Having the Council acceptance Bill of of contain provisions for shipowners; to Resolution result conditions industry, proposals flat satisfy a defensive can b e shipowners, conditions the the shipping.industry Section2 o f proposed is the cargoes down i n my "Memorandum in the' F i n a n c i a l represents the is scheme The p r o p o s a l s of it found legislation Government's in as be laid before Department, scheme applying conditions White Paper which tramp these d e c i s i o n s , e scheme f o r on t h e The of of secured and t h e C h a n c e l l o r of the Shipowners' to be prepared a subsidy for of the conditions in ships the B i l l , attached, so f a r liner carry as t h e y business they tramp registered I in have caused a sanction to to draft the 31st December, cargoes under on t h e of the payment 1935, tramp in the U n i t e d Kingdom. drafted simplest A lines, is 1 *nd 2 ) . owners w i l l carry Scheme, of the Lord P r e s i d e n t the Exchequer 1st January which i s tramp of of legislative carriage (see Clauses 5.. C a r g o L i n e r as t h e y giving the ye a r in r e s o e c t copy o f the concurrence cargoes under parcels fear come u n d e r that of tramp the scheme conditions, tramp c a r g o e s the scheme w i l l in so far but their prejudice ordinary them. The Liverpool scheme and - the they how that to grant tend to Owners Scrapping 6. So scheme as which tonnage the subsidy being 8. to In of of provision included in Order the of present and of the f a c i l i t i e s . 9- A out there copy the it the of main of is the of at the of and the ascertaining it the is clear present co-operate two ­ in on groups time the Tuesday, of Cargo concerned is 25 p o s i t i o n l a s t . reception may h e this possible that know some has There of is such a strengthened year in and of i t for B i l l , with White of Paper the may the by quantity be the that a then be in mind opportunity scheme brought prospoct issued in of tramp into of the for a July scheme, the whether should concurrence proposed attitude tonnage. consideration building to the new bearing possible and them of every is that definitely construction reasonable lines June place they Trade a of the up. scrapping Board of them am m e e t i n g a t t i t u d e circumstances, if sets when the to I are taken and employment, a them subsidy subsidy l i n e r s favourable when providing for the to of the p o s i t i o n . whose hand paid between trade. a l a i d consider these importance creation of change scheme further incentive the has other may is subsidy Memorandum evidence shipowners prepared my a effect shipowners since for oppose Scheme. shipowners, B r i t i s h On explain any may d e s i r a b i l i t y representatives far by a tramp Building reduction 7. the to l i t t l e the t h e i r and a l t e r e d s t i l l of of oppose will such owners position" from remove Liner asked the scheme of November, Liner have Apart the organisation the probably group Cargo "equalise fact the v/ould not would owners. in 27th of London £500,000 tramp group be force of the by an Treasury substantial 1934, is which attached use for information, clauses. (See a t t r a c t i v e , (a) and the Clauses 3 draft to Bill 6). But, I submit for That owners "be required approval every ton of new every ton of e x i s t i n g of three tons contains the to make only b u i l t , shipping each the following scrap shipping in to appropriate casd scheme a l t e r a t i o n s : ­ two and tons for ton for one modernised, as the more scheme instead stands at present . (b) That owners from be allowed foreign to "buy ships for as scrap owners as well to Liners in p a r t i c u l a r scrapping B r i t i s h ships. Financial 10. I Assistance do provision special this not in note). 11. A propose respect cases Concession in claims respect respect of 12. points a The subsidy carrying by the of as paid Cabinet by the which introduction not more a (ii) me in by the (vide shipping any of in 1 paragraph of respect. shipping to give (iv) of industry. effect to paragraph industry is l e g i s l a t i v e assistance this Bill decision to of than cargoes shipowners may b e (See required the l) Clause may 8 ) . be and in to the £2 millions accordance give Fees. attached for with l e g i s l a t i v e (Minor draft one the B i l l year in to the grant to scheme sanction a l t e r a t i o n s to ships submitted the draft B i l l necessary). (ii) Whether principles should on financial the d r a f t the present (vide before fees in paid of at trades. follows:­ tramp concession shown fees grant l i n e r s of by suggest are appears in as a No approved (i) of B r i t i s h concession summarised to to clause The to in be a scrapping indicated paragraph included 9 in in the above) the and building draft and in Bill (with the the White Paper B i l l . W. H of T r a d e , I26th November, 1934. scheme' on R. the modifications of July l a s t , DRAFT WHITE PAPER. BOARD O F TRADEo Section I4EII0RANDUH 1. for The Financial carrying shipping into outlined the 3rd 1934! would be freight of will Scheme The be 4 name of Board Board 5. scheme Tramp to by 1st as to Committee will be estimated that the authority regard tramp to shipping in the position House of i t s the average made Commons l e v e l (see paragraph 2 of for a this that to 31st a of make of year the The 1935. Committee to and the altered. December, of cent, 14 if were Committee of per one period statutory to 92 and Paper). period introduction and £2,000,000, 1929 administration under advise subsidy, recommendations the the and to in the them. incurred in Trade defrayed t o t a l exceed above Subsidy claims of not rose within appoint regarding Board necessary year Section January the if payable Shipping expenses r,he of to to examine Trade The led proposed Trade of is the would year withdrawal which on figure the be the p a r t i c u l a r in w i l l to the with Trade subsidy subsidy is of the I proposed I t B t h i s Part circumstances period subsidy in subject of RESOLUTION. c below l e v e l proposals Board the during average Subsidy the of reduced rates the 3. amount provides statement the on The Shioping. in of 0 Tramp the President 2 FINANCIAL effect the July, ON T H E Resolution by 1. the and by cost the the of administration Tramp Tramp of Shipping Subsidy administration the subsidy subsidy Fund. will I t not is exceed £10, 000. 6. the to The 3rd President July, introduce of che Board announced that l e g i s l a t i o n in of before regard Trade, the to a in h i s statement G-overnment were subsidy v/ould it of prepared be necessary to for the shipowners formulate a scheme satisfactory t h e G o v e r n m e n t w h i c h w o u l d 5­ (i) p r e v e n t s o f a r as p o s s i b l e t h e s u b s i d y f r o m b e i n g d i s s i p a t e d by the domestic c o m p e t i t i o n of B r i t i s h s h i p s c a r r y i n g - t r a m p c a r g o e s , and (ii) ensure t h a t i t i s e f f e c t i v e l y d i r e c t e d t o securing t h e g r e a t e r employment o f B r i t i s h t r a m p s h i p p i n g at the expense o f f o r e i g n s u b s i d i s e d s h i p p i n g . 7. The shipowners have a c c o r d i n g l y Government subsidy, containing industry and t o scheme i s achieving the ill the p r e c e d i n g the their the o b j e c t s of 1934, the Board o f also rates of the world o n c e more t o condition Trade, proposals a remunerative level. taking supply The F i n a n c i a l scrapping and r e b u i l d i n g carrying outlined through open to maritime adjust to to the supply raise freight, t o meet secure to discuss in is into at a date the n e c e s s a r y or modernising proposed that to be legislation this a meeting of proposals the demand. the f i x e d by necessary for of British issued in the cargo July the Board o f vessels 1934 scheme s h o u l d b e brought Trade has been p a s s e d . 1 0 . A d v a n c e s made and l o a n s g u a r a n t e e d modernising the the p r o p o s a l s the White Paper It operation also provides into effect (Cmd. 4 6 4 7 ) . or to of world tonnage Resolution for building to of Rebuilding. authority after out statement In order steps the which were set shipowners, t o t h e demand &nd t h u s tending to 9. the tending Shipping Conference and Government and i n a n y o t h e r ways the I n t e r n a t i o n a l ScroTping The in his shipowners i n other the shipowners are adjust the The the c o n d i t i o n s l a i d down t h a t organisations, the framing in of to paragraph. them s h o u l d p r e s s u p o n t h e tonnage they intend Paper. the the the subsidy,, this to of organisation of scheme as f u l f i l l i n g International countries the d i s t r i b u t i o n the b e t t e r in Section 2 of The P r e s i d e n t 3rd J u l y , for s u b m i t t e d .a scheme the arrangements which to promoting contained have a c c e p t e d 8. proposals and d e s c r i b i n g make w i t h a v i e w of to cargo v e s s e l s for under the purpose the above of scheme would the not cost ships), the is exceed of in building and no of two brought into 11. estimated The 12 the 0 I t repeal Provisions) Board for the the shipping from of of and fees or (approximately tons of guarantee date on administering the that 18 the of maximum the Bill the The modern given which and other to any to date services in shall cargo after the scheme of this to industries of l i m i t s of the repeal of this fix in so the that the aggregate of Section in of for charged 1 shall fees Act with be of e a r l i e r the that receipts cost the Section SHIPOY/PEPS be fees the 1923 which fixed w i l l connection April, fees £3,000. provision repeal 1st respect is Acts. contain services from scheme (Miscellaneous required one-half this Shipping Economy result shipbuilding up Merchant ships the by weight the be administering restored from not equal The million made will approximately 13. dead be of under 1926,, Trade survey such cost Section Act, the years proposed of would £10 operation. charged is aggregate 1,000,000 advance expiration Fees be the are Acts of paid. will 1926. 2. SUBSIDY SCHEME. Sootlon SHIPOWNERS' Part DEFINITIONS, ( l) The B r i t i s h at in the bulk, (2) are United not a for of payable Subsidy. only the United the 1st January, that which in respect Kingdom 1934, are of -which and vessels have new completed been vessels and date. constructed for accommodation substantial within the for amount scope qf the carriage more of than of 12 oil passengers, refrigerated the cargo subsidy. Voyages. Character qualify be Kingdom with with Vessels course of in specially E l i g i b l e (a) port since ships ships -will after Ships space a ships registered and Payment SCHEME. Ships. subsidy registered in SUBSIDY ETC. Bl liable b u i l t I. 2. of voyage. falling subsidy which a l l within only the in the provisions respect cargo of carried a of (l) voyage is carried will in the under charter party. (b) Voyages Voyages I r i s h Free excluded. wholly S t a t e , between the p o r t s Channel in Islands the United and the Kingdom, I s l e of excluded. (c) Duration There may (i) of be time voyages. included occupied discharging in i,n an e l i g i b l e loading, cargo. voyage carrying or Man are (ii) time oooupied in b a l l a s t (a) to f e t c h (b) to (o) t o pay (iii) time oooupied (iv) time not or I n the any p a r t this (3) 3 days spent in is an e l i g i b l e of trade; discharging (i) in the or cargo; (ii); and voyage repairing. thereof opinion tramp the dispute arising voyage as t o w h e t h e r for the a voyage purposes t h e Tramp S h i p p i n g S u b s i d y of Committee prevail. Period in respect voyages) 1st the in bunkering f o r any the accordance with crew a f t e r of Payments w i l l of in event scheme, shall off ­ booked; oustom of exoeeding exclusively (d) cargo seek oargo normal voyages of is payable. o n l y be made i n r e s p e c t taking place January, whloh subsidy during a period of of voyages one y e a r (or parts commencing 19 35. METHOD OF APPLICATION FOR SUBSIDY. (4) Every shall register (including shipowner d e s i r i n g may I n h i s opinion a r i s e . be n o t i f i e d Committee are are arise, the (5) of If owner the he w i s h e s of (6) the voyage . that any o f of amended the to to within In the ships of the subsidy list must the inoluded in suoh s u b s i d y may which during in any an e l i g i b l e olaim subsidy In respect a period of accordingly. an e l i g i b l e - s h i p the Committee If which claims f o r s u b s i d y y e a r has o o m p l e t e d make a p p l i c a t i o n paragraph of be list whloh claims f o r Any m o d i f i c a t i o n s In r e s p e c t shall of by him t o t h e C o m m i t t e e . opinion ships list Every quarter must, not of subsidy a s t h e C o m m i t t e e may r e q u i r e ) owned by him I n r e s p e c t forthwith list i n the w i t h t h e C o m m i t t e e h i s name and a suoh p a r t i c u l a r s tramp s h i p s to participate of that voyage royagc, t h e manner r e q u i r e d 21 d a y s after the by completion (6) Every such a p p l i c a t i o n such p a r t i c u l a r s C o m m i t t e e may (7) shall and h e s u p p o r t e d b y consider f r o m an o w n e r i n a c c o r d a n c e w i t h having this scheme, Trade in p a n i e d by such e v i d e n c e regard to every the as include the application of make such r e c o m m e n d a t i o n The the or other Statute thereon to and and of the Board recommendation w i l l as t h e B o a r d may p r e s c r i b e , such v o u c h e r s received preceding provisions the p r o v i s i o n s a s t h e y may deem p r o p e r . such f o r m s u c h f o r m and direct. The C o m m i t t e e w i l l will, he i n of b e made and w i l l b e a c c o m ­ evidence as t h e B o a r d may require. METHOD OF CALCULATING AND PAYING THE SUBSIDYc (8) The amount among o w n e r s w i l l of the subsidy available for b e such sum n o t exceeding £2 m i l l i o n be p r o v i d e d b y t h e Government expenses incurred able w i l l (9) to the in administration. be d i s t r i b u t e d paragraphs after (13) a c c e p t e d by t h e Board in among a l l of deduction The accordance distribution total with the sum s o the owners whose of as may avail­ following claims are T r a d e on t h e r e c o m m e n d a t i o n of the Committee. (9) I n t e r i m payments w i l l quarter of the subsidy y e a r , such a d j u s t m e n t after under p a r a g r a p h (12) i n t e r i m payments w i l l consultation with the the b e made i n the y e a r The t o t a l be f i x e d subsidy w i l l be calculated (11) For each q u a r t e r of the y e a r , to accepted during purpose the accepted included in the q u a r t e r w i l l gross claims w i l l that amount of of to required the quarterly Trade on a b a s i s after claim, tons be m u l t i p l i e d and t h e sum o f by included the "ton-days". "ton-days" have be a s c e r t a i n e d . register of t h e number o f each o w n e r w h o s e a p p l i c a t i o n s t h e number o f subject Committee. The credited each a s may b e by t h e Board (10) to be of t h e s e payments b e i n g end o f below. respect been For this in eaoh number o f these products of days will be takeru The t o t a l quarter w i l l to then be d i v i d e d t h e number o f adjustments, i f (12) of total subsidy year the owners f o r (13) by If appear number o f to ensure made i s each owner r e p r e s e n t s the Committee w h i c h had b e e n l a i d prejudice is that thereby being the quarter receive should be more i n r e c e i v e d had proportion of respect caused the to t o him f o r to the all will Interim t h e amount it should eligible trading and shipping, amounts p a y a b l e a t the the end owners should not quarter than they would there been t r a d i n g in that quarter tonnage as ships that that eligible the proportions British that to proportion subsidy y e a r used f o r (13). payable the an undue number o f so a d j u s t e d of of account, h i s due is adjustments total the up a r e b e i n g C o m m i t t e e may recommend t h a t of of any proportion credited The n e c e s s a r y d u r i n g any q u a r t e r to the credited ton-days taken i n t o to with paragraph ascertaining t h a t when t h e the subject quarter ton-days in proportion t h e whole y e a r which the whole y e a r . payments a l r e a d y received the f o u r t h for each, in accordance a g g r e g a t e number o f t h e n b e made distribution among o w n e r s i n be c a l c u l a t e d by total and t h e for credited t o the end o f each owner w i l l between ton-days necessary, After the amount f i x e d only have such t h e C o m m i t t e e may recommend. (14) of If the i n the opinion subsidy year the y e a r (expressed p e r c e n t a g e ) was l e s s b y 100 p e r for cento) the year w i l l the of the Board o f average level of Trade freight at the end rates for as an i n d e x number r e p r e s e n t i n g than the then the average total b e a sum n o t for 1929 (represented sum p a y a b l e b y t h e exceeding a a quarter Treasury of a * / N o t e . I n o r d e r t o meet the e v e n t u a l i t y o f a refund h a v i n g t o b e made b y o w n e r s as t h e r e s u l t o f t h e f i n a l a d j u s t m e n t s , t h e f o r m s o f c l a i m and payraenv. ucroi f o r t h e q u a r t e r l y :iirteriru p a y m e n t s w i l l e s t a b l i s h cbe l i a b i l i t y o f o w n e r s t o r e f u n d l a t e r i f so r e q u i r e d ^ million pounds f o r for subsidy y e a r the subject every unit is t o a maximum o f The f o l l o w i n g table less £2 per cento by which the than the a v e r a g e for average 1929, milliono shows the working of this paragraph: Table, I n d e x number r e p r e s e n t i n g average l e v e l of f r e i g h t r a t e s during subsidy year. (1929 * 1 0 0 ) . 100 and a b o v e i j j ; L i m i t ot subsidy amount o f payabla. ­ 99 £250,000 98 £500.000 97 £750,000 96 £1,000,000 95 £1,250,000 94 £1,500,000 95 £1,750,000 92 and u n d e r £2,000,000 PART I I . ORGANISATION OF THE INDUSTRY. Memorandum e x p l a i n i n g of the 1. subsidy "a The Tramp S h l p p l n g A d m i n i s t r a t i y e Government, offered 2. That as international, Consequently the sense is to fully since its To introduce into the necessarily the of only a prooer successful, therefore elastic Tramp S h i p o w n e r s ' organisation condition will be being of to and a l l o w it their for of the character. in ago, been it has members. its methods. co-operation change and must early stages. are convinced Government assistance industry. reasons g i v e n , is not but, if They have His Majesty's by t r i a l and e r r o r f o r m c a n be d e t e r m i n e d b y e x p e r i e n c e , w o u l d be the iron be until rather system which, by imperfect. Committee they contemplate cast that co-operation which w i l l t o grow n a t u r a l l y The main f e a t u r e s Tramp S h i p o w n e r s ' that the to a system of General 3. by t h e offer I n s i s t upon an immediate premature, Committee desired r e a l value should accept i t s more p e r m a n e n t than t o a revolutionary Is unorganised and t o and In i t s In among i t s nature organisation involves submitted t h a t , Government of a century its Shipping. Government individualism be somewhat e x p e r i m e n t a l Nevertheless the measure of Industry. be a s Tramp fluid the Involved and must been c o m p a r a t i v e l y both t o principle s u c h an i n d u s t r y relative development individualism belongs these for Tramp S h i p p i n g and e x c e p t i o n a l l y marked b y a v e r y h i g h d e g r e e This the a p p r e c i a t e d by t h e has h i t h e r t o that, of conditions that such an i n d u s t r y competitive, it certain stated necessarily in r e l a t i o n Industry, laying.down organisation" words are Such interpreted of and Cojxuaittea he s e t J i ^ h y jtlie^ S h i p o w n e r s . t o Tramp S h i p p i n g , r e a l measure 262 0 onsd, I t u t I o n and F u n o t i ons the Sub-Committee a t o " nature of of organisation the are proposals. shown b e l o w . establishment by t h e p r o p o s e d by It will industry be the seen itself of a "Tramp Shipping sub-committees The Committda co-operation Administrative for p a r t i c u l a r would, among as i t s minimising (b) improving freight (c) promoting as main domestic is contemplated that as to the be to the for might special functions, set up purposes. a c t i v e l y promote in rates and conditions; foreign possible It or which competition against the f u l l e s t shipping. steps trade8 shipowners (a) Committee" subsidised employment Committee adopted by and of would competition British make shipowners for tramp Recommendations achieving these objects. Constitution 4. The Committee Committee, would be an elected elected by the Tramp by twelve members, of the Chamber of Shipping and two of the Chamber of Shipping and Liverpool Association, Chamber who by appointed of ten of will them and Shipping accommodation for also to will the have f i l l work of the the Functions 5, It Is Administrative (a) to proposed that Committee promote maintain (c) to to should organised and co-operation (b) the and t h e i r discretion they think of of the freights conditions employment of members a r i s e . staff The and the Tramp following among and by ­ owners such i n t e r e s t s charter Shipping as to organised generally. in their f i t ; Charterers in an British Owners' methods. include such with such necessary functions promote Ship Committee Committee. recommend confer if of Committee 1 Liner withdraw co-operation improve to Joint Steam to vacancies composed Shipowners the power provide body ships. effort to increase the 6. For the purpose of provided promoting among owners, as above, would seek to collect and world freight markets as would functions of the organised the Administrative c i r c u l a t e be co-operation such Committee information likely to be of concerning assistance to shipowners. 7. The promoting (i) operation ,qng Tramp ' ers^ co-operation to to ( i i ) to any depress promote l i n e r 1 cargo the influencing against -operation been c.sp o w n e r s among co-ordinate by with -operation th f o r e i g n rpowners sanisations. ( i i i ) to below to an co-operate where action possible Organisations, such Conference the to if a's necessary, delegate any mentioned the and Administrative Committees the as as might be be special of and at Conferences foreign International and Australian outportsj the to and Shipowners' Shipping I n t e r n a t i o n a l i t s e l f or bodies. The objects by through of trades might either and, a c t i v i t i e s the appropriate In p a r t i c u l a r delegate p a r t i c u l a r described sub­ principal i t probably knowledge the tramp effective. would appoint and such undertaken most Committee out cargo d i r e c t maintain with the Baltic functions would with carrying Plate Committee Administrative Committees i t s above and Conference. committees of shippers levelj Liner 8, T h e A d m i n i s t r a t i v e C o m m i t t e e w o u l d tion t h r o u g h o-commi t t e e s ^ committees or co-ordinating committees for such of economic with front ratesj Maritime trades united tramp ­ shipowners consultation, l i a i s o n mutual Tramp an in action operation between mutual or of combined Committee include maintain co-operation view improve to freights by would operations possible owners a owners them representation, ner owners. Administrative above Subthe to trades relating to co-operation tramv owners 9. b e t w e e n t r a m p and l i n e r the Committees would be l e f t arrange co-operation (since the conditions trade) b u t would keep i n c l o s e control of general policy. e t c . on t h e l i n e s s u i t e d vary considerably the A d m i n i s t r a t i v e Co-operation Board o f Trade w i t h Tramp S u b s i d y t o make r e c o m m e n d a t i o n s the payment of Committee w i l l on m a t t e r s of the o f t h e Tramp a regarding Administrative Committee to subsidy. The A d m i n i s t r a t i v e inaustry. Committee w i l l the advantage of the experience consultation, when n e c e s s a r y , (a) that Subsidy The Tramp S h i p p i n g C o n s u l t a t i o n w i t h t h e shlopinp; 11. of i s t o be appointed by t h e co-operate with the Statutory the objects the A d v i s o r y Comm.1tt8e.' t o t h e Board o f Trade the subsidy. trade to Committee understand 1 under t h e p r o v i s i o n s Act to t o each from t r a d e Committee The Tramp S h i p o w n e r s free t o u c h w i t h and b e u n d e r Tramp S u b s i d y Advisory C o m m i t t e e secure and among themselves. Normally, 10. owners of the Industry with t h e Tramp S h i p o w n e r s ' throughout have through ­ Committee o f t h e Chamber of Shipping; (b) the Liner (c) the Council 12. Committee o f t h e Chamber As, moreover, the Sub-Committees w i l l in daily contact practical their cost i n character functions of Shipping. C o m m i t t e e and shipowners m a r k e t s and w i t h t h e needs of a l l sections these bodies w i l l and s h o u l d b e a b l e be of thorough3.y to carry w i t h t h e maximum e f f i c i e n c y administration. Shipping; b e composed o f p r a c t i c a l and p a r t i c u l a r concerned, of of both the Administrative with the f r e i g h t general conditions the industry o f t h e Chamber out a t t h e minimum REPORTS A report 13. the working of organization the end o f further November, the these Committees first at WORKING-. the President and c o - o p e r a t i o n report 19 3 4 . to OF the of in the the T r a d e on and on t h e p r o g r e s s s i x months of end o f the Board o f industry w i l l the year. of b e made s u b s i d y y e a r and a MERCHANT SHIPPING Outline of a scrapping scheme for the British President and rebuilding or C a r g o Vessels discussed of the Representatives of in with to the on Board of the H o u s e of 3rd July, between Trade Shipowners and accordance statement modernising and presented President^ Commons 1934 Presented by the President of the Board of Trade to Parliament by Command of His Majesty July, 1934 LONDON PRINTED AND PUBLISHED BY HIS MAJESTY'S STATIONERY OFFICE T o be purchased directly from H . M . S T A T I O N E R Y O F F I C E ' at the following a d d r e s s e s A d a s t r a l H o u s e , K i n g s w a y , L o n d o n , W . C . 2 ; 120, G e o r g e Street, E d i n b u r g h 2 York Street, Manchester 1; 1, St. A n d r e w ' s Crescent, Cardiff So, Chiehester Street, Belfast or through any Bookseller 1934 Price Cmd. 4647 id. Net. MERCHANT SHIPPING. OUTLINE OF A SCRAPPING AND REBUILDING OR MODERNISING SCHEME FOR BRITISH CARGO VESSELS DISCUSSED BETWEEN THE PRESIDENT OF THE BOARD OF TRADE AND REPRESENTATIVES OF SUIL'OWNERS AND PRESENTED IN ACCORDANCE WITH THE PRESIDENTS STATEMENT TO THE HOUSE OF COMMONS ON 3RD JULY, 1934. 1. T h e scheme contemplates that financial assistance would be granted to British owners to enable them to build n e w United K i n g d o m tonnage or to modernise existing United K i n g d o m tou­ nage on condition that they scrapped not less than three times as much United K i n g d o m tonnage of the same general character. T h e modernising of an existing United K i n g d o m ship would entitle the owner to the same benefits on the same conditions as would apply to the building of a new ship. T h e scheme would be ad­ ministered by an expert Advisory Committee. 2. T h e scheme would not apply, either in respect of the ships to be built or to be modernised or to be scrapped, to ships carrying more than twelve passengers, ships w i t h a substantial amount of refrigerated cargo space, tankers, ships solely engaged in the coast­ wdse trade and cargo liners engaged in the short sea trades. The scheme would apply to the classes of tonnage known as the United K i n g d o m tramp ships and the U n i t e d K i n g d o m general cargo liners with the exceptions indicated above. Applicants would have to show that more than half the property in the vessels to be scrapped was in British ownership on 31st M a r c h , 1934. 3. A shipowner would be free, within the limits indicated in para­ graph 2, to settle the specifications for the work of building or modernising, to select the firm to carry out the work and to make any other necessary arrangements as if the work was being carried out entirely for his own account, subject only to the work being carried out in yards in Great Britain. T h e scheme would not apply to ships to be built or modernised in shipyards in Northern Ireland, since Government assistance is available there under the Loans Guarantee (Northern Ireland) A c t . 4. Financial assistance would be given in the form of loans advanced or guaranteed by the Treasury. T h e rate of interest would not exceed 3 per cent. T h e loans would be repayable within a period of 12 years by equal annual instalments covering capital and interest but the borrower would be entitled to defer the instalments due in either or both of the first t w o years and to spread their repayment, with interest, over the remainder of the period of 12 years. T h e borrower would be responsible for all expenses involved. o. A shipowner desiring to avail himself of the scheme would apply to the Committee for a loan, the amount of which would not exceed the amount of the accepted tender for building or modernis­ ing the ship, together w i t h the expenses of the loan. I n considering its amount, the Committee would have regard to the money avail­ uble to the owner from the proceeds of the sale of the tonnage to l^e scrapped, so far as such m o n e y was not subject t o prior charges. T h e loan would be secured by a first mortgage on the ship to be built or modernised. 6. Scrapping would be carried out i n the U n i t e d K i n g d o m except in cases in which the Committee approved other arrangements. Shipowners would be required to g i v e satisfactory guarantees that ships to be sold to foreign jjurchasers for scrapping abroad would not be used by the purchasers for trading before they w e r e scrapped. Ships earmarked for scrapping in this country could only be used for trading with the approval of the C o m m i t t e e , the intention being that such ships should cease trading before the new or modernised ship was operating. 7. Shipowners would be required to g i v e satisfactory guarantees not to sell to foreign purchasers ships which had received assistance, until the mortgage had been paid off. T h e sale of such ships t o British owners would be subject to the prior consent of the Committee. (24674) Wt : - 2C00 7/31 P . St. G.S74 British Shipping (Assistance) BilL ARRANGEMENT O F CLAUSES. PART I . SUBSIDY I N RESPECT OF TRAMP VOYAGES. Clause 1. 2. Payment of Subsidy. Tramp Shipping Subsidy Committee. PART I I . ASSISTANCE TO SHIPOWNERS PROPOSING TO IMRROVE MERCHANT SHIPPING FLEETS. 3. 4. 5. 6. Power to make advances or guarantee loans in respect of approved proposals. Requirements as to vessels in respect of which assistance may be given. Provisions as to loans and advances. Commencement of Part I L PART I I I . MISCELLANEOUS. 7. 8. 9. Supplementary provisions. Repeal of 16 & 17 Geo. 5. c. 9, s. 18. Short title. 11-3 D E A F oir T A B I L L TO Make provision for the granting oil financial A.D. vm. assistance to the owners of ships registered in the United Kingdom in respect of tramp voyages carried out during the year nineteen hundred and thirty-five, and to persons entitled to be owners of British ships in respect of pro­ posals for the improvement of merchant ship­ ping fleets ; to provide for the repeal of section eighteen of the Economy (Miscellaneous Pro­ visions) Act, I92G ; and for purposes connected with the matters aforesaid. B E it enacted b y the King's most Excellent Majesty, b y and with the advice and consent of the Lords Spiritual and Temporal, and Commons, in this present Parliament assembled, and b y the authority of the same, 5 as follows : — PART I . SUBSIDY: I N RESPECT OF TRAMP VOYAGES. 1 . — ( 1 ) For the purpose of helping the owners of Payment vessels registered in the United Kingdom to compete of subsidy. 10 with foreign shipping in receipt of subsidies from foreign Governments, the B o a r d of Trade may, subject to such directions as may be given b y the Treasury, and in accordance with the advice of an advisory committee (hereinafter referred to as " the T r a m p Shipping Subsidy 15 Committee " ) pay to the owners of vessels eligible for 11-3 A British Shipping (Assistance). A . D . 1034. PART I. —con I. [ 2 5 GEO. 5.] subsidy under this Part of this Act such subsidies in respect of tramp voyages wholly or partly carried out within the year nineteen hundred and thirty-five as may be recommended by the Tramp Shipping Subsidy Committee: 5 Provided that no such subsidies shall be paid in respect of any voyage wholly between ports within the United Kingdom, Irish Free State, Isle of M a n and Channel Islands. (2) The vessels eligible for subsidy under this Part 10 of this Act are vessels to which this Act applies, being vessels registered at a port in the United Kingdom, which have been British ships since the first day of January, nineteen hundred and thirty-four or, in the case of vessels completed after that date, since they were com­ 15 pleted, so however, that vessels completed after that date shall not be eligible for subsidy unless they were built in the United Kingdom. (3) The sums necessary for the payment of subsidies under this section and for the payment of any expenses 2 0 incurred under this Part of this Act shall be defrayed out of moneys provided b y Parliament and shall not exceed in the aggregate two million pounds. Tramp Shipping Subsidy Committee. 2 . — ( 1 ) The Tramp Shipping Subsidy Committee shall consist of not more than eight persons appointed b y the Board of Trade to advise the Board generally, as to the operation of this Part of this Act, and in par­ ticular as to the making of payments by w a y of subsidies under this P a r t of this Act and the terms and conditions upon which such payments should be made, and in con­ sidering any recommendations to be made to the Board under this Part of this Act the Committee shall have regard to the purpose for which the Board are empowered to grant subsidies under this Part of this Act and shall not recommend payment of a subsidy in respect of any tramp voyage if, in the opinion of the Committee, the voyage was undertaken without due regard to the necessity for co-operation in furthering that purpose between owners of British vessels undertaking tramp voyages. ( 2 ) The Board of Trade may appoint secretaries to the Tramp Shipping Subsidy Committee, and the 25 30 35 40 Committee may employ such, officers and servants as the A.D. in.34. Committee may, with the consent of the Board and of p^Tj the Treasury, determine; and there shall be paid as part -L ont. of the expenses incurred under this Part of this Act to the 5 secretaries and to any officers and servants so appointed such salaries and allowances as may be determined by the Board with the approval of the Treasury. C PART ASSISTANCE 10 II. TO SHIPOWNERS PROPOSING TO MERCHANT SHIPPING FLEETS. IMPROVE 3. I f the Board of Trade, after consultation with an advisory committee appointed for the purposes of this Part of this Act by the Board with the concurrence of the Treasury, are satisfied that any proposals submitted 1 5 to the Board by any person entitled under the Merchant Shipping Act, 1 8 9 4 , to own a British ship, provides for the building or modernization of vessels in respect of which assistance may be given under this Part of this A c t and for the demolition of such number of such vessels that 2 0 the tonnage to be demolished amounts to not less than three times the tonnage of the vessels proposed to be built or modernized, and that the proposals comply in all other respects with the requirements of this Part of this Act, the Board may approve the proposals and 0 5 upon any such proposals being so approved— (a) the Board may, with the consent of the Treasury, make an advance to that person for the purpose of enabling him to build or modernize the vessels provided for by the proposals; or 30 (b) the Treasury may, on the recommendation of the Board give a guarantee for the repayment of the principal of, and interest on, any loan raised for that purpose. 35 40 4 ^ — ( 1 ) N o proposals submitted under this Part of this Act shall be approved by the Board of Trade unless the Board are satisfied that all vessels to be demolished, built or modernized in pursuance of the proposals are vessels in respect of which' assistance may be given under this Part of this Act and that the proposals contain provisions securing to the satisfaction of the Board— (a). that the vessels to be demolished in pursuance of the proposals— A 2 P O Y C R T O * s u a r a n t e e loans in respect of approved P P ­ 1 0 0 s a h Require­ menta on to aspect trf which assistance may be given. A . D . 1934. PAUT II. -conl. (i) are vessels which have been registered at a port in the United Kingdom since the thirty-first day of March, nineteen hundred and thirty-four, and will remain registered at such a port until demolished; (ii) will be demolished within the United Kingdom, or with the consent of the Board of Trade outside the United Kingdom in accord­ ance with such conditions as may be imposed by the B o a r d ; 10 (iii) will not, after the date upon which any advance is made or guarantee -given under this Part of this Act or such later date as the Board may allow, be used for any trading voyage; 15 (b) that the vessels to be built or pursuance of the proposals— modernized (i) will be built or modernized Britain; and in in Great (ii) will not, while any part of the principal 20 of or interest on, any loan made or guaranteed under this Part of this Act remains out­ standing, be sold to any person not so qualified as aforesaid to own a British ship or, without the consent of the Board, to any other person. 25 (2) The vessels in respect of which assistance may be given under this Part of this Act are vessels to which this Act applies and which are, were, or will be, as the case may be, employed in the carriage of com­ mercial cargoes and not employed mainly in voyages 30 between ports within the United Kingdom, Irish Free State, Isle of Man and Channel Islands, or in main­ taining regular services between such ports and ports in the Continent of Europe between the River Elbe and Brest inclusive. 35 Provisions us to loans and ad­ vances. 5.—(1) A n y advances made under this Part of this Act and the principal of any loans guaranteed under this Part of this Act shall not together exceed in the aggregate ten million pounds, and no such advance shall be made or guarantee given after the expiration of two years from 40 the date of the commencement of this Act. ( 2 ) A n y advance made or guarantee given under A.D. 1934. this Part of this Act shall be made, or given, upon such terms as may be determined by the Treasury, and without PART I T . prejudice to the generality of this provision such terms —cont. 5 shall include the following terms, that is to say :— (a) that the advance or guarantee shall be secured by a first mortgage on any vessels in respect of which the advance or guarantee is made or given; 10 15 (b) that the rate of interest on any advance made or loan guaranteed shall not exceed three per cent, per annum; (c) that the principal of, and interest on, any advance made or loan guaranteed shall be repayable by instalments within a period not exceeding­ twelve years. ( 3 ) Such sums as may from time to time be required for the purposes of making any advances under this Part of this Act, or of fulfilling any guarantees given under 2 0 this Part of this Act shall be charged on and issued out of the Consolidated Fund of the United Kingdom or the growing produce thereof. (4) For the purpose of providing for the issue of sums out of the Consolidated Fund or of any part of any 2 5 sum so issued, the Treasury may raise money in any manner in which they are authorised to raise money under and for the purpose of subsection ( 1 ) of section one of the War Loan Act, 1 9 1 9 , and any securities created and issued to raise money under this subsection shall for all 3 0 purposes be deemed to have been created and issued under the said subsection ( 1 ) . ( 5 ) All sums received by way of interest on advances made under this Part of this Act shall be paid into the Exchequer, and all sums received in repayment of any 3 5 sum issued out of the Consolidated Fund under this Part of this Act shall be applied in such manner as the Treasury may direct to the redemption of debt. ( 6 ) The Board of Trade shall, before the first day of October in every year, prepare an account in such form 4 0 and in such manner as the Treasury may direct of the advances made under this Part of this Act, and the 11 B 6 British $flipping (Assistance), [ 2 5 G E O . 5,'J A . D . 1934. sums received by way of interest on, or in repayment of, such advances during the last preceding financial year ^ ^ P^ ^ ^-^nl and Auditor General shall examine and certify the account and shall lay copies thereof, together with his report thereon, before both Houses of 5 Parliament. a n f o n : i r o e r (7) The Treasury shall, as soon as may be after each quarter of each year during which guarantees may bo given under this Part of this Act, lay before both Houses of Parliament a statement of the guarantees given under 10 this section during that quarter, and shall so long as any such guarantees are in force lay before both Houses of Parliament in every year within one month after the thirty­ first day of March, an account up to that date of the total sums, if any, which have been either issued out of 15 the Consolidated Fund under this Part of this Act or paid in or towards repayment of any money so issued. 6. This Part of this Act shall come into operation upon such date as may be appointed by order of the 20 Board of Trade with the consent of the Treasury. Commencemeat of Part I I . PART I I I . MISCELLANEOUS. Supple- mentary provisions. a p 7.—(1) The vessels to which this Act ajmlies are \ [ ships which are neither fishing vessels nor constructed 25 r adapted­ (a) for the carriage of more than twelve passengers; or (b) for the carriage of oil in b u l k ; or (c) in such manner that more than per cent. of the space available for cargo is adapted 3 0 for refrigerating purposes. ( 2 ) In this Act the expression " tramp v o y a g e " means a voyage in the course of which all the cargo carried is carried under charter party. ( 3 ) If, in connection with the operation of" this Act, 3 5 any question arises— (a) whether a vessel is a vessel to which this Act applies; or (6) whether a vessel is eligible for subsidy under A.D. 1931. Part I of this A c t ; or — PART I I I . (c) whether any voyage was a tramp voyage, or as to the extent of any such voyage, or whether 5 any such voyage was wholly or partly carried out within the year nineteen hundred and thirty-five, or was a voyage wholly between ports within the United Kingdom, Irish Free State, Isle of Man, and Channel Islands; or 10 (d) whether any vessel is a vessel in respect of which assistance may be given under Part I I of this Act, the question shall be decided by the Board of Trade after consultation with the appropriate advisory com­ 15 inittec, and the decision of the Board shall be final. (4) Anything required or aiithorised by or under this Act to be done by, to, or before the Board of Trade may be done by, to, or before the President or any Secretary, Under Secretary or Assistant Secretary of the 20 Board or any person authorised in that behalf by the President of the Board. 8. Section eighteen of the Economy (Miscellaneous Repeal of Provisions) Act, 1926 (which gives directions to the 16 & I Board of Trade as to fixing the amount of the fees to - -- * 25 be charged under the Merchant Shipping Acts, 1894 to " ' 1923) is hereby repealed. 7 G e o 5 c 9 s 9. This Act may be cited as the British Shipping (Assistance) Act, 1934. Short title. British Shipping­ (Assistance). D R A F T OF A B I L L T o make provision for the granting of financial assistance to the owners of ships registered in the United Kingdom in respect of tramp voyages carried out during the year nineteen hundred and thirty-five, and to persons entitled to be owners of British ships in respect of proposals for the improvement of merchant shipping fleets ; to provide for the repeal of section eighteen of the Economy (Miscellaneous Provisions) Act, 1926; and for purposes connected with the matters aforesaid. CCCXXVL-A. (2.) 26th November 1934. 11-3