business bosses have welcomed the news that Britain may no longer have to pay for Ireland’s lighthouses.

A row has been raging for years from the shipowners who call into UK ports such as Southampton and have to pay a fee to cover lighthouses and navigational aids used in England and Wales – and in Ireland too. The UK has been subsidising Ireland to the tune of about £12m a year.

This has forced up light dues at British ports making them less competitive as they vie for business with foreign rivals.

News of an agreement comes after a Daily Echo campaign against increases to tax hikes that was backed by port chiefs and business leaders.

It was launched last year after an announcement that shipowners bringing their vessels into Southampton docks would see fees climb from 35p per ton to 39p and than again to 43p.

Rumours that large ship-owners might start using cheaper foreign ports sparked fears of job losses at the time.

Southampton City Council cabinet member for economic development, Royston Smith, said: “We welcome the news. Everything we are doing is about trying to make the port, Southampton’s biggest employer, more competitive.

“We have been looking at the various duties and fees because many of them seem quite arbitrary, we are very content that we will no longer be paying for Ireland’s lighthouses.”

Hampshire Chamber of Commerce boss Jimmy Chestnutt said: “Nobody has been able to explain to me why we should pay for another country’s lighthouses. Anything that helps the port be more competitive is jolly good news.”

The Daily Echo understands an agreement has finally been reached between London and Dublin and a timetable for removing the subsidy could be announced shortly.

All three lighthouse authorities Trinity House, which covers England and Wales, the Northern Lighthouse Board that deals with Scotland, and Commissioners of Irish Lights, are working on ways to cut costs.

UK Shipping Minister Mike Penning is understood to have thrashed out the deal as Ireland is negotiating a bailout deal worth more than £70bn which is set to include a multi-billion pound loan from the UK.