dave December 16, 2019 No Comments

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.

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