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    2024 IMO Bravery Awards honor tanker and tugboat crews for heroic acts

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SAFETY4SEA

BPA: UK ports face more uncertainty due to COVID-19 than Brexit

by The Editorial Team
May 19, 2020
in Ports
covid 19 on board cargo ships
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The British Ports Association published new data according to which 36% of UK ports feel confident about their business outlook over the next 12 months and 86% reported either substantial or severe impacts on shipping and customer activities

Specifically, the data show that although the majority of the ports have not taken advanage of Government support measures, more than half, 55%, are not satisfied with the fundings that are available.

Thus, in efforts to boost the British Shipping industry, the Government inked agreements with six operators to provide up to £35 million to ensure that there is enough freight capacity to prevent dirsuption to the flow of goods.

Commenting on the results, Phoebe Warneford-Thomson, Policy & Economic Analyst at the British Ports Association, stated

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Several months into the Coronavirus pandemic, it does not come as a surprise that 86% of ports report a substantial or severe impact on their customer activities and that just 36% feel confident about the year ahead. Those with particular concerns are ports involved in passenger activities, the oil sector and manufacturing-related cargo and fish landings.

According to the results, 44% of ports have seen difficulties obtaining PPE and that support for furlough has been the most popular Government support measure.

Ports are not only seeing a substantial impact on their customer activity and obstacles to commercial operations but facing requests for assistance from port users too. Ports have quite literally helped keep the country supplied during the pandemic.

Accordingly, Ms Warneford-Thomson also outlined that the findings showed that:

Confidence: With regards to the outlook for port businesses, 64% of ports identify that they are ‘not so confident’ or ‘not at all confident’ about the outlook for their port in the coming 12 months. Compared to the BPA’s Business Confidence Survey conducted during Brexit negotiations, 69% felt between somewhat confident and very confident. Now, just 36% feel this way.

Customer Activity: Survey results confirm that Coronavirus has had a vast impact on ports around the UK. 51% of respondents report that there has been a substantial impact on customer activity due to COVID-19, with a further 35% reporting a severe impact.

Operational Challenges: 65% report a reduction in landside operational staff, 49% report a reduction in marine operational staff, 24% report a reduction in management staff, 29% report issues sourcing mechanical components, 44% report issues sourcing PPE and 5% report issues with storage space for cargo. In terms of the overall workforce at a port, 89% of ports had seen a minor to substantial impact, due to illness, self-isolation or furlough.

Assistance Requested of Ports by Users and Tenants: At a time when port cash flows have been severely impacted, the vast majority of port users and tenants have also asked for assistance from ports; including rent holidays, the extending of payment terms and a reduction in harbour dues. A significant number of ports had seen requests for all three. Others have seen requests for suspensions of mooring fees, laid-up charges and a reduction in shore power costs.

Brexit Transition Period: With regards to whether ports think the Brexit transition period should be extended, 43% of respondents say yes, 32% say no, 26% say they do not know.

Construction: Of ports who originally had construction projects planned during this time, 64% say they are paused for the time being, 15% say they are progressing at a slower pace, 13% say there has been no impact and 8% say that they have been cancelled completely.

Financial Assistance: 69% of ports record that they do not require financial assistance, while 31% record that they do. Many commented to note that if the current situation continues for a prolonged amount of time, then they will do. Similarly, 32% of respondents say they are concerned about borrowings and banking covenants, 68% say they are not.

The ones that required assistance with regards to what governent support packages ports are opting for:

  • 66% are opting for the Coronavirus Job Retention Scheme
  • 26% are opting for VAT Income Tax Deferral
  • 20% are opting for Sick Pay Relief, 14% are opting for HMRC Time to Pay
  • 11% are opting for the Small Business Grant for SBRR businesses
  • 0% are opting for the Coronavirus Corporate Financing Facility (CCFF).
  • Under the ‘other’ option, one port is opting for ‘bespoke assistance’, another is opting for ‘Retail Rate Relief Grant’ and another says they will be asking to defer their corporation tax payment.

Concluding, BPA notes that 45% of respondents report that they were satisfied with the measures offered by government, 55% report they are not satisfied. Comments include suggestions that business rates relief should be offered to ports including ferry operators, an extension of the furlough scheme (since announced), support for the fishing fleet and deckhands, and a financial package to provide assistance to their users and tenants (as it is key for ports that these businesses survive the crisis).

BPA: UK ports face more uncertainty due to COVID-19 than BrexitBPA: UK ports face more uncertainty due to COVID-19 than Brexit
BPA: UK ports face more uncertainty due to COVID-19 than BrexitBPA: UK ports face more uncertainty due to COVID-19 than Brexit
Tags: British Ports AssociationCOVID-19portsshipping industryUK
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