Cabinet ministers want more homework done on port relocation

Shane Jones is keen to avoid too many more lengthy reports but acknowledges it’s a once-in-a-generation project and widespread buy-in is important. Photo: RNZ / Richard Tindiller.

Cabinet ministers have ordered more work to be done on the Northport proposal, to report back to Cabinet mid next year.

It’s officially released the report of the working group set up to consider the best configuration for the upper North Island ports, which came back with a strong recommendation to progressively move Auckland’s freight operations to Northland.

The Transport Ministry will now do more work on funding and financing options, governance and commercial considerations, land use planning and a range of other factors.

(Read the full report: PDF 1.4MB)

The Cabinet paper released alongside the report said the “key issue” for ministers was “whether the the potential gain… is sufficient to justify the significant Crown seed investment and possible need for regulatory and legislative intervention”.

Using the latter approach, it said, would result in “significant levers to use given the implications for private property rights”.

The working group made its one recommendations after considering eight scenarios – Cabinet ministers also want the ministry to also take another look at those scenarios.

(Read the full report: PDF 1.1MB)

The paper noted the “limited share of decision making rights” held by the Crown if it comes to relocating ports, and the importance of getting key stakeholders such as the Ports of Auckland and the Auckland Council on board.

“We advocate early and open engagement with the owners of the current upper North Island ports…and the Port Companies” to build consensus, the paper said.

The current owners are “cornerstone partners whose agreement and cooperation in any decision will be a requirement of making progress”.

It acknowledged engagement with those parties had been “limited to date…we anticipate aligning the partners will take some time to achieve”.

The ministry will also work with the newly formed Infrastructure Commission to help with the analysis.

Associate Transport Minister and chief cheerleader Shane Jones said he was “pleased” his Cabinet colleagues have “recognised the merit of this report and have agreed to move forward with this work”.

“I expect this analysis to consider environmental effects, including on New Zealand’s overall greenhouse gas emissions, and consideration of government infrastructure investments in roads and rail, for example, building a rail spur to Marsden Point,” he said.

“Nobody is keen on spending too much longer developing lengthy reports but this is a once-in-a-generation project and widespread buy-in is important, as is the need to make the best decisions for the long-term prosperity of our supply chain.”

It remained his view that Northport was “the most sensible relocation option” but he accepted this “is a whole-of-government decision”.

The working group has estimated the cost of the Northport proposal at around $10 billion.

Cabinet expects a report back by May next year. The report has a budget of $2 million.

Goff says compensation essential

Auckland’s Mayor Phil Goff says the city’s residents will need compensation when the port is eventually relocated.

Goff said a newly released working group report on the Northport proposal suggests Auckland is left with the land rather than being bought out.

He said residents have invested over $600m in the port and should be treated as shareholders.

“They need to get some sort of compensation if that asset were to get taken off them and that’s basically what Treasury and the Ministry of Transport have pointed towards,” Goff said.

“This isn’t the wild west, you can’t go around nationalising things and saying: ‘well, just be grateful we’ve left you the land even if we’ve taken the value of the company off it’.”

Goff said he was pleased Cabinet ministers have ordered more work to be done on the Northport proposal.

“What we wanted was evidence driven, robust and independent of any vested interest group report saying how it should happen and where it should go to,” he said.

‘Pie in the sky’ – Bridges

National’s leader Simon Bridges said the $10b price would be a big hit on the government’s books.

“If they make this decision they won’t have a single bean left from their infrastructure spend up; they can only spend this borrowed money once.”

And he questioned the government’s ability to make Northport a reality.

“These guys can’t deliver, they are unrealistic, they’re pie in the sky, they come up with a lot of stuff. They’re always short on the implementation and the delivery – this thing is fraught with issues.”

Northport wants to talk to two other ports

Northport said it is ready to meet with Ports of Auckland and Port of Tauranga to discuss the future of freight for the North Island.

In a statement, its chairman Murray Jagger said a newly released working group report on the Northport proposal gives it confidence to talk about the potential opportunities.

Mr Jagger said the three ports need to digest the ramifications of the report and discuss the situation together.

“Northport has a very clear vision of the role it can play in the economic growth of Northland, Auckland and New Zealand,” he said.

“Significant growth is possible here. We have been clear for many years that we stand ready to assist in any way we can to support Auckland’s growth and the aspirations that Aucklanders have for their waterfront.”

Mr Jagger said he hoped to convene a meeting of the chairs of all three ports involved – Northport, Port of Tauranga and Ports of Auckland.

“We need to digest the ramifications of what we’ve seen and heard today, and flesh out a win-win-win situation not just for our three communities, but for all of New Zealand,” he said.

“We then need to seek the input of tangata whenua, our wider communities, and business and civic leadership before bringing these suggestions to government.”

Ports of Auckland has declined an interview with RNZ.

KiwiRail investment through Land Transport fund: government proposal ‘historic’ – chief exec

The government is moving to fast-track billions in funding for rail investments in a change that is being hailed as historic.

Freight Train, Reid McNaught

A new style of funding will allow KiwiRail to plan for long-term investments, the state owned enterprise’s chief executive says. Photo: KiwiRail

The state-owned enterprise’s funding is usually approved annually by the Crown, but the government yesterday released a draft rail plan that will prioritise new trains, tracks and bridges across the country by funding KiwiRail’s budget through the National Land Transport Fund.

KiwiRail Group chief executive Greg Miller.

Greg Miller Photo: Supplied / KiwiRail

KiwiRail chief executive Greg Miller said this would allow the company to plan for long-term investments – including upgrades to national freight rail and passenger rail in Wellington and Auckland – rather than relying on year-to-year funding from the Budget.

“This is an historic change in the way rail is treated in New Zealand,” he said.

“Each year we go cap in hand to the government for capital projects to develop our nationwide rail network of 3500 kilometres and as you can appreciate with the inclemency we’ve just seen in the South Island, our network was cut off in three parts of the South Island and it takes capital to fix that.”

Flooding across paddocks.

Recent flooding in the South Island that cut the rail network in three places requires the kind of money for repairs that may be more readily available in a new style of funding, the state owned enteprise’s chief executive says. Photo: Supplied/Peter Lyttle

He is hopeful the plan will make the state-owned enterprise more independent.

Other priorities under the draft plan include a new train control centre for Auckland, replacing the two interislander ferries and ageing rail locomotives and wagons. Safety at level crossings, where two people died last week after being hit by trains in Auckland, will also be improved.

The plan is subject to feedback and changes and the government will need to pass the associated Land Transport Legislation Bill, which has its first reading before parliament next week.

Transport Minister Phil Twyford said upgraded rail would boost productivity, and reduce road congestion and net greenhouse gas emissions.

Dave Morgan, flamboyant and newsworthy union leader

Karl du Fresne, Dec 07 2019

Dave Morgan, pictured on his retirement as national secretary of the Maritime Union in 2003.
MAARTEN HOLL/STUFF Dave Morgan, pictured on his retirement as national secretary of the Maritime Union in 2003.

David John (Dave) Morgan, trade unionist; b Adelaide, South Australia, May 29, 1940; d Masterton, November 5, 2019

Dave Morgan was one of the last of a generation of New Zealand trade union leaders who were once household names.

His death at the age of 79 recalled a time when industrial disputes were constantly in the headlines and union leaders such as Morgan, Pat Kelly, Bill Andersen, Ken Douglas, Blue Kennedy and Con Devitt were publicly branded as wreckers and agitators. 

Of that coterie of formidable unionists, only Douglas – now 84 – survives. 

For 30 years, the Australian-born Morgan led a union that was synonymous in the public mind – not always fairly – with disruption to shipping, most notoriously on the Cook Strait ferries.  

As president of the Seamen’s Union, which became the Seafarers’ Union after a 1989 merger with the smaller but equally stroppy Cooks and Stewards Union, he was a newsworthy figure.

He was also, by trade union standards, an unusually flamboyant one, noted for his collection of stylish hats and colourful ties. Known in union circles as The Hat, he had a sense of style that set him apart in a line of work not normally associated with sartorial elegance. 

Asked about his celebrated collection of headwear, he once said his motive was purely pragmatic. “I would have thought it was pretty self-evident – I’m as bald as a badger.”

Public attitudes to the Seamen’s Union were summed up in a North and South article in 1990 by David McLoughlin, who wrote: “They’re widely seen as the mob which stops the Cook Strait ferries in the middle of seemingly every holiday … enormously powerful, featherbedded, working only half the year if they’re unlucky, overpaid, flown to their jobs from wherever in the country they choose to live”.

Dave "The Hat" Morgan and Seamen's Union colleagues occupying the Shipping Corporation's boardroom in Wellington in 1988.
ROSS GIBLIN/STUFF Dave “The Hat” Morgan and Seamen’s Union colleagues occupying the Shipping Corporation’s boardroom in Wellington in 1988.

It was certainly true that the two major maritime unions, the seamen and the watersiders, wielded unusual power in an economy almost wholly dependent on shipborne trade. That power was magnified by the seamen’s ability to shut down commerce between the North and South islands.

It was also true that the shipping industry had a history of harsh working conditions, anachronistic employment practices and combative relationships with shipping companies dating back to the 19th century. All this contributed to a tough and uncompromisingly militant union culture.  

Yet shipping employers who dealt with Morgan respected him as an honest negotiator and liked him personally. That was evident from heartfelt and moving tributes paid to him privately after his death from cancer.

He was easy to like: amiable and quietly spoken (although a stirring orator when the occasion required it), with a distinctive raspy voice and a bone-dry sense of humour. But you knew there was a steely core there somewhere. There had to be, to maintain control over a union whose fractious members could be just as challenging to deal with as the bosses.

In a newspaper story marking Morgan’s retirement 16 years ago, Pacifica Transport chief executive Rod Grout said Morgan would fight tooth and nail for his members, but added that “you knew where you stood with him”. And he gave Morgan much of the credit for promoting shipping industry reforms that helped end the disruption of Cook Strait ferry sailings.  

Morgan was admired internationally. Following his death, messages of sympathy flowed in from around the world – evidence of his involvement in causes such as the campaign against apartheid, and of his assistance to unionists in Third World countries where he would have clandestine meetings with local activists forced to live like fugitives under authoritarian regimes. 

Much of the disruption caused by the Seamen’s Union was political rather than industrial. Morgan was instrumental in initiating a long-standing trade ban against Chile after the 1973 military coup that overthrew the elected socialist leader Salvador Allende, and he was proud of the union’s role in opposing a visit to New Zealand by the nuclear-powered warship the USS Truxtun.

Seamen's Union members protesting at Port Taranaki in 1983. Strikes among maritime workers used to be common before the upheavals of the late 1980.
ARCHIVE Seamen’s Union members protesting at Port Taranaki in 1983. Strikes among maritime workers used to be common before the upheavals of the late 1980.

It was clear from Morgan’s funeral in Masterton’s Copthorne Solway Park Hotel that respect for him spanned ideological lines across the Left. Former Labour Party deputy leader and Cabinet minister Annette King, an old friend, flew from Canberra, where she is now New Zealand’s high commissioner, to deliver a eulogy. Justice Minister Andrew Little – himself a former union leader, though of a more moderate persuasion than Morgan – also attended.

The 260 mourners were treated to a verbal tour-de-force by the Australian unionist Paddy Crumlin, president of the International Transport Workers’ Federation, who delivered a spirited and often humorous 20-minute off-the-cuff oration, barely pausing for breath, on socialist values and the virtues of working-class solidarity.

Born in Adelaide, Morgan was one of three siblings in a Catholic family. He was taught by nuns of the Sacred Heart order, whom he recalled with some fondness, and later by the Marist Brothers, whose brutal discipline engendered less affection.

It was said at his funeral that he once considered entering the priesthood, but after going to sea at 16 as a deckhand on the BHP-owned Iron Monarch, Morgan discovered another belief system that resonated more powerfully with him. By the age of 18 he was a member of the Australian Communist Party. He remained a committed socialist until the end, although in later life he disavowed any party alignment. 

In a 1998 radio interview with Brian Edwards, Morgan recalled being radicalised during late-night debates in the ship’s mess-room. The Iron Monarch had a crew of 24, of whom five or six were communists. 

Morgan was captivated by the ideological dynamics of his working environment. Communism, he explained to Edwards, held out the hope of a better life. That was a widely held view among his union peers in the 1950s and 60s, and it persisted despite evidence of appalling repression under communist regimes.

Morgan told Edwards that, while he was no apologist for the denial of human rights, he refused to condemn communism because of mistakes or excesses by leaders such as Joseph Stalin.

Bill "Pincher" Martin, Morgan's predecssor at the Seamen's Union, in 1971.
THE DOMINION Bill “Pincher” Martin, Morgan’s predecssor at the Seamen’s Union, in 1971.

In 1963, by then an able seaman, Morgan moved to New Zealand to join the Union Steamship Company and promptly made the acquaintance of kindred spirit Pat Kelly, a feisty fellow Marxist, and his wife Cath. 

The Kellys’ son Max recalled at Morgan’s funeral that the two men met for the first time in the public bar of a Wellington hotel; he wasn’t sure whether it was the Terminus or the Post Office (both long gone). Between drinks, Pat Kelly would sell copies of the New Zealand Communist Party paper the People’s Voice.

The two became firm friends, confidantes and drinking mates, although Morgan, an enthusiastic boozer in his younger days, would renounce alcohol and cigarettes after a life-changing car accident at Paekākāriki in the early 1980s. 

The two men’s families also bonded closely, sharing holidays in the Kellys’ bach, an old Railways house, at Ohakune. Max Kelly recalled that the man the public knew as the leader of angry protest marches would play the clown at the Kelly children’s birthday parties. He was a mentor to Kelly’s sister Helen, who became president of the Council of Trade Unions before succumbing to cancer in 2016. 

After Pat Kelly’s death in 2004, Morgan placed an In Memoriam notice in The Dominion Post on his anniversary every year, in which he paid tribute to his former comrade and commented wryly on his deficiencies as a racing tipster. Both liked a punt on the horses.

In 1970, Morgan met Margaret “Maggie” Lee, a school dental nurse, while on an anti-Vietnam protest march in Auckland. By that time he had come ashore to take up an appointment as the union’s Lyttelton branch secretary. The two were married the following year and would later adopt a daughter, Jenny Katene. 

In the words of Annette King, Dave and Maggie Morgan made a formidable team, “fearless and committed”. For years they lived in a union-owned house in Austin St, Mt Victoria, which served as a social gathering place for the Left, and for which they paid $26 a week in rent – a fact exposed in 1989 by an angry chief Labour Court judge, Tom Goddard. 

In a withering judgment provoked by the union’s refusal to comply with an injunction ordering ferry crews back to work during an illegal strike, Goddard ordered sequestrators to seize the union’s assets – and for good measure, opened its finances to public scrutiny.

Goddard calculated that a true market rent for the Austin St house, which by accident or design was painted pink, would be at least $200 a week. But as McLoughlin pointed out in North and South, it was hardly a luxurious property – and this was long before Mt Victoria was gentrified. 

The family later moved to Masterton – ironically, almost as far from the sea as it’s possible to get in New Zealand – where Morgan lived a quiet life as the devoted patriarch of his whānau. 

He retired as national secretary of the union in 2003, three decades after stepping into shoes previously occupied by Bill “Pincher” Martin and, before Martin, the feared union strong man Fintan Patrick Walsh. In his last weeks, he joked that he wanted to be buried next to Walsh in Karori Cemetery, but with a taller headstone. 

Under Morgan’s leadership, the seamen were part of a hard core of Left-wing blue-collar unions – along with others representing meat workers, boilermakers, watersiders and truck drivers – that regarded themselves as upholding traditions of militancy, solidarity and class consciousness.

But with the economic upheavals of the 1980s, some old union alliances began to unravel. Morgan found himself at odds with his former friend and fellow communist Ken Douglas as the movement bitterly split over how best to maintain union strength and cohesion in the face of deregulation, globalisation, job losses and legislative changes that were seen as tilting the industrial playing field in favour of employers. 

By the time he retired, Morgan had observed not only a drastic decline in union power, but also the disintegration of the Soviet-led communist bloc from which he and many of his peers had drawn ideological inspiration.

But the socialist flame burned brightly to the end. His death notice finished with the union slogan “Solidarity Forever” – and at his funeral, mourners sang The Internationale, the anthem of the socialist Left. 

He left instructions for his ashes to be scattered at sea off Wellington Heads.

Sources: Stuff archives, Nga Taonga Sound and Vision, North and South, Maggie Morgan, Max Kelly, Annette King, Chris Eichbaum.

Stuff

Nation ‘$1b poorer’ if port leaves Auckland

With a working group’s third report on Port of Auckland’s future not available to the public, others are pushing ahead with their own analysis, Dileepa Fonseka reports.

A third port study will go before a Cabinet committee on Wednesday but on Tuesday Finance Minister Grant Robertson gave a clear indication it wouldn’t be enough on its own to persuade him to support moving Auckland’s port to Northland.

“The report’s a useful contribution, but as I’ve said to you previously, I’ve got further questions I want answered.”

“This is a massive, massive move we’re talking about here. So you know, we’ll go through the process, but we haven’t made a decision to do it.”

Meanwhile another report into the future of Auckland’s port has been released. 

The NZEIR report calculates New Zealand would be $1b poorer if the Port of Auckland’s functions were taken up by either Northport or Tauranga. 

“Auckland is both the largest source of import demand in New Zealand, and the largest concentration of commercial activity,” says the report.

“An equally profitable port elsewhere, employing the same number of people, would have a similar direct effect on its local economy, but its wider economic effect would depend on how efficiently their customers’ exports and imports moved from the port to their doors.”

The use of diesel trains to transport goods from Northport to Auckland would emit 121,461 tonnes of carbon dioxide into the atmosphere every year. 

“Longer and more frequent road or rail trips would be required to bring imports to their ultimate destination or to the port for exporting.”

Most of the costs of relocating the port would be borne by Auckland in terms of reduced consumption, higher prices, and longer wait times for freight. 

People and businesses in New Zealand’s largest city would see the cost of their imports go up by $549m if port operations moved to Northland or $626m if port operations moved to Tauranga, the report says. 

But the rest of the country would see the cost of their imports go down if the port’s business was taken up by Port of Tauranga or Northport.

Economist Laurence Kubiak, who authored the report, said this was because other ports, like Centreport in Wellington for example, would import more and goods would have to travel a shorter distance to get to consumers in those areas. 

Anticipating the report’s release 

Both Infrastructure Minister Shane Jones and Upper North Island Supply working group chair Wayne Brown told Newsroom last week they were looking forward to a possible release of the full report this week after Cabinet deliberations.

After details of the report leaked, Auckland’s Mayor Phil Goff has bristled at its reported suggestion POAL could be taken off Auckland Council with only waterfront space as compensation, and Jones has called POAL CEO Tony Gibson a “recreant” – cowardly renegade – after details emerged that Jones warned Gibson not to put his head in a “political noose” by going up against NZ First on the port issue. 

Others have expressed concern at the mode shift that would be required from shippers of freight – who have been favouring trucks in greater numbers – in order to make a Northport option work. 

Supporters have lined up behind moving the port from its current location in Central Auckland too. 

RNZ reported former Prime Ministers John Key and Helen Clark were backing a “Waterfront 2029” to get rid of POAL and The New Zealand Herald reported National MP Nikki Kaye had expressed a preference for moving the port but wanted to explore a number of options including the Firth of Thames.

NZ to join international maritime convention to reduce ship emissions

Wednesday, 4 December, 2019 – 14:55

New Zealand will sign up to new international maritime regulations to reduce ship emissions and lift air quality around ports and harbours, Associate Transport Minister Julie Anne Genter announced today.

Subject to completion of the Parliamentary treaty examination process, New Zealand will sign up to Annex VI of MARPOL, an International Maritime convention for the prevention of pollution from ships.

“Joining this convention will improve the health and environmental impact of shipping emissions, particularly around our port communities.

“It will give Maritime NZ the power to inspect foreign ships for compliance with new emission standards and take enforcement action if necessary.

“Signing up will also ensure New Zealand has a seat at the table as new global greenhouse gas emission maritime regulations are negotiated over the next few years.

“The convention’s regulations limiting sulphur emissions from shipping are due to come into force on 1 January 2020. However, as the previous government did not initiate the process of signing up to this convention, there will be a longer lead in time before these regulations apply to domestic ships.

“The treaty examination process means that New Zealand would sign up to Annex VI in late 2021. Stricter limits on sulphur limits would then apply to domestic ships from early 2022. This gives our shipping and fishing industries sufficient time to prepare for the new regulations,” said Julie Anne Genter.

Background

The IMO convention, MARPOL Annex VI, regulates atmospheric emissions from ships. It will also be the platform for new IMO measures to reduce greenhouse gas emissions from ships, which are expected to be ready in 2023.

The most significant regulatory impact of Annex VI will be new sulphur limits on marine fuel. The current sulphur limit of 3.5% by mass for marine fuels will drop to 0.5% when new Annex VI regulations take effect globally on 1 January 2020. Compliance can be achieved by using low sulphur fuel or fitting an exhaust cleaning system known as a ‘scrubber’ to reduce emissions to a level equivalent to those from low sulphur fuel.

All ships ‘flagged’ to Annex VI party states visiting New Zealand will have to comply with the new regulations from that date. Similarly, New Zealand-flagged ships travelling to states that are party to Annex VI will also have to comply.

Almost 100 countries representing 97 percent of global freight capacity are already signatories to the convention. Subject to the parliamentary treaty examination process, and legislation changes necessary to implement the convention, New Zealand is expected to accede to Annex VI in late 2021. Ships operating only in domestic waters will have until early 2022 to comply, as Annex VI would come into force for New Zealand three months after accession.