Proposal for Government to buy 50 per cent stake in Ports of Auckland from council

Tom Dillane

Tom Dillane is a reporter at the New Zealand Herald tom.dillane@nzme.co.nz@tomdillane1

A written proposal from the chair of Auckland Council’s planning committee for the Government to buy a 50 per cent stake in the Ports of Auckland has been released to the Herald today.

The four-page draft proposal from Auckland councillor Chris Darby outlines that “time is of the essence” as the city loses $65 million a day in lockdown two, and selling an interest in the ports is the most logical way to save council’s finances.

The original Covid-19 lockdown left a $750m hole in Auckland Council’s budget, and the city’s economy broadly is losing $65m a day during the second August lockdown.

“With the re-emergence of Covid-19 in early August, Auckland Council is now faced with even further reductions in revenue and is fast running out of options to progress already reduced work programmes while balancing its finances,” Darby writes in the proposal.

“My proposal to transfer a 50 per cent stake in POAL to Government ticks a number of important strategic boxes and is a win for Auckland and a win for New Zealand.

“With the re-emergence of Covid-19, the need to prepare has new urgency. It is unreasonable and unsustainable to expect being spoon-fed with government handouts.”

Darby says he considered three key moves to generate revenue from Auckland Council’s strategic assets: the disposal of part or all of the Auckland International Airport [$1.9 billion], the dissolution of public energy trust Entrust [$2.6b], or the disposal of part or all of POAL [$1.2-1.6b].

The four-page draft proposal from Auckland councillor Chris Darby outlines that
The four-page draft proposal from Auckland councillor Chris Darby outlines that “time is of the essence” as the city loses $65 million a day in lockdown two. Photo / File

But selling 50 per cent of the POAL, with an estimated worth of between $1.2 billion and $1.6b, was the preferred option because it would free up “significant capital for injection into future-ready projects” to respond to Covid-19, and be more politically feasible.

“I have purposely avoided the ongoing and eventually damaging inconsequential rearranging of council’s lesser assets in preference for a major transaction that more immediately and materially repositions council’s finances,” Darby wrote.

The councillor said he has informally discussed the proposal with Auckland mayor Phil Goff, the deputy mayor, the other council committee chairs, and three government ministers.

A spokesperson from the mayor’s office said it was the first time the mayor has seen the councillor’s formal proposal.

“The mayor has publicly stated previously that he is not in favour of the sale of strategic assets. Any such proposal would need to be considered by councillors through the normal council process,” the mayor’s spokesperson said.

A spokesperson from the mayor's office said it was the first the mayor has seen councillor Darby's formal proposal. Photo / File
A spokesperson from the mayor’s office said it was the first the mayor has seen councillor Darby’s formal proposal. Photo / File

However, the chair of the council’s finance and performance committee, Desley Simpson, said she was disappointed Darby had not properly canvassed his proposal with her.

But Simpson added she was aware of ideas circulating within council about selling POAL, as the council’s governing body begins consultation on its 10-year Long-Term Plan next week.

“I am disappointed councillor Darby hasn’t shown due respect to his colleagues by discussing his ideas in detail before taking them to the media,” Simpson said.

“These ideas aren’t unique to councillor Darby. Others have mentioned them before and it would seem unusual he would seem to take them as his own when he will be aware that other people have mentioned them before.”

Auckland Council's finance and performance committee chair Desley Simpson. Photo / File
Auckland Council’s finance and performance committee chair Desley Simpson. Photo / File

Deputy mayor Bill Cashmore also said he had not had detailed discussions with Darby about sale of the POAL, and felt it was “unfortunate” he had not produced a “more formal paper to councillors”.

“Councillor Darby and I did discuss several weeks back that there would be a need to have a long-term financial plan or strategy that may have to be by necessity something other than business as usual,” Cashmore said.

“Councillor Darby also bought something along these lines to a chairs’ meeting but with no detail to it.”

POAL chief executive Tony Gibson said any comment on the sale of the POAL should be left with its owners – Auckland Council.

Darby’s proposal specifically rules out an private investor in the council’s stake in POAL, stating that “would be politically unacceptable, for both council and Government, and likely be resisted by iwi and Aucklanders”.

The benefit of the Government owning 50 per cent of POAL would be aiding the post-Covid-19 “recovery of the Auckland economy without setting a precedent, which grant funding potentially could”.

Aside from the direct injection of substantial funds, for the council the transfer of ownership would remove half of the consolidated debt of POAL, which Darby says currently sits at $490m.

The original Covid-19 lockdown left a $750 million hole in Auckland Council's budget, and the city's economy broadly is losing $65m a day during the second August lockdown.
The original Covid-19 lockdown left a $750 million hole in Auckland Council’s budget, and the city’s economy broadly is losing $65m a day during the second August lockdown.

Employers and Manufacturers Association chief executive Brett O’Riley – also a former chief of council CCO Auckland Tourism, Events and Economic Development – endorsed Darby’s proposal.

“From our perspective we would be pleased to see Auckland Council do this. It’s something we have called on for a long time,” O’Riley said.

“We supported the average 3.5 per cent rate increase because we recognised there is a significant amount of infrastructure both to be maintained and developed by Auckland Council and its entities in Auckland, which is part of Auckland’s long-term plan.

“Auckland’s only going to continue to grow so we have to find ways of injecting more capital into Auckland Council’s activities. Clearly during Covid-19 it’s a hard call to make. But at times like this we have to make some hard decisions.”

The Ministry of Transport has been contacted for comment.

Firth of Thames best home for a new port for 100-plus years: Auckland Business Chamber (and Cubic agrees)

The suggestion of the Firth of Thames is a
The suggestion of the Firth of Thames is a “brave, big call”. Photo/ Google

By: Andrea Fox Herald business writer andrea.fox@nzme.co.nz

Just when you thought not another report could be wrung out of Auckland’s port future debate, the Auckland Business Chamber is urging all Kiwis to completely “re-imagine” a port for 100-150 years – and it’s pick is in the Firth of Thames.

After staying pretty quiet during a flurry of reports over shifting the Auckland port, the chamber is launching its own take, “A Port for the Future”, which invites the community to use an accepted timeline that the existing port will do for another 25 or so years, to carefully plan another to last more than another century.

And for port observers feeling reported-out, Chamber chief executive Michael Barnett assures “this is not another report”.

“It is an effort by the chamber to get people to re-imagine where a port might be and what would be the best for New Zealand and New Zealand business – not a competition between Auckland and North or Tauranga but an informed discussion of what could be.”

Barnett said the chamber represents the voice of Auckland business without bias, and in this neutral position has stepped back to analyse all the discussion around the relocation of the port from Waitemata Harbour.

“The chamber … now realises that the issue is not just an Auckland problem, but is one that, if done correctly, will bring benefits right across New Zealand.”

The chamber had concluded the existing port was fully sustainable for another 25 to 30 years and that a solution is required beyond that. To provide a port solution beyond the generation after next required vision and a willingness to go beyond the familiar.

Ports of Auckland has 25-30 years of life left in it, says Auckland Business Chamber. Photo / Michael Craig
Ports of Auckland has 25-30 years of life left in it, says Auckland Business Chamber. Photo / Michael Craig

The chamber’s offering makes a case for a man-made island ship exchange terminal in the Firth of Thames, connected by broad gauge rail to a container terminal facility in the vicinity of Pokeno/Meremere.

The island terminal would be “a whole-of-New Zealand” terminal servicing large foreign trade ships handling all import and export containers. The report does not discuss costs but points to several overseas examples to underline there is nothing in the paper that is not tried and proven elsewhere in the world.

“What is running out (for the existing port) is social licence and that’s what’s motivating us to try to accelerate the debate and re-imagine what a port could look like”, Barnett told the Herald.

“What’s been uncomfortable has been the apparent political nature of the discussion so far, it tends to have been personality-driven from the north – almost an anti-Auckland thing. Yet this isn’t about either of those things, it’s about a nation down in the South Pacific dependent on its ability to import and export.

“We need something for the next 100 years and the people of New Zealand should make that choice. It’s not up to a politician or a government.

“(So far) we have re-imagined the port simply by saying ‘let’s pick up Auckland port and take it north (to Northport)’. I’m saying we can do it another way.”

The chamber will widely distribute its paper within the freight, transport and shipping sector and invite comment and discussion directly to the chamber.

The chamber’s analysis concluded there would always be a need for a port in Auckland – “just not as we know it”.

Auckland Business Chamber chief executive Michael Barnett.
Auckland Business Chamber chief executive Michael Barnett.

Social licence issues arising at New Zealand ports were “but the tip of the iceberg and demonstrate that the focus being purely on relocation of the Port of Auckland is extremely narrow and has the potential to lead to a flawed conclusion”, said the paper.

“Ports of Auckland is clearly approaching a sunset phase, however, it is the chamber’s view that the present facility will be capable of handling existing throughput plus growth for several years to come … (but) it is inevitable and acknowledged by the chamber, that the port’s container facilities will be shifted from the present location to another site.”

The paper said volume growth and investment required at the Port of Tauranga, along with “other issues starting to emerge” made it “pretty safe to assume that the Tauranga terminal will also be looking for a new location in future”. In four weeks the Tauranga port handled as many containers as Wellington’s port in a year.

Current modelling showed that with the construction of the future city of Drury South, the Auckland-Hamilton-Tauranga triangle would encompass four of New Zealand’s six largest cities.

Over the next 30 years the population in the area between greater Auckland and Taupo was forecast to grow by 7.8 per cent a year. During this time the rest of New Zealand’s population was predicted to grow by 2 per cent a year and by 3.6 per cent north of Auckland.

The option of developing a new port at Manukau Harbour raised in earlier reports was indeed an option when considered just in the context of Auckland, the paper said.

“However it is not compatible with the chamber’s objective of providing a future solution that will benefit NZ Inc. Throughout … the chamber has avoided introducing untested or yet to be implemented technology as will be required to overcome the hazardous conditions presented by the Manukau Harbour entrance.”

The Firth of Thames had been looked at in studies over the past 25 years.

“Unfortunately the concept appears to be too far out of the mainstream for people to understand, especially as it has only been viewed as a solution solely for Auckland and suggest constructions methods based on the traditional.”

The paper details modern construction methods used overseas.

Barnett concedes the chamber’s suggestion of the Firth of Thames is a “brave, big call” given the environmental, wildlife and iwi concerns that are likely to be raised against it.

But with time on New Zealand’s side for consultation, research, innovation and planning, problems could be properly addressed and hopefully overcome.

Barnett, a veteran of port group discussions over the years, worked with ports consultant Tony Boyle to produce the paper. The project cost did not exceed $10,000, he said.

“But I like to think it is rich in intention.”

Auckland traffic reduced as more people work from home

More Aucklanders are believed to be working from home after the Covid-19 lockdown, leaving the city’s notoriously packed motorways to flow a little freer. no caption

Photo: 123rf.com

Traffic at key sites at most of the country’s major cities has returned to pre-lockdown levels, but Auckland is the exception.

Data collected from traffic counters between the Queenstown Rd and Hillsborough Rd on and off ramps showed there were about 112,700 vehicles passing through each week, excluding weekend days.

This was 89.7 percent of the previous year’s 125,569 vehicles, according to the New Zealand Transport Agency’s latest statistics from the end of June.

Meanwhile, traffic counters at specific sites in Wellington showed traffic was about 95.9 percent of the previous year, Christchurch at 104.6 percent, Hamilton at 100.2 percent, and Dunedin at 99.7 percent.

This drop was also mirrored in public transport use.

Patronage was 67.5 percent of last year in Auckland, which meant about 45,000 fewer people taking return trips.

This compares to Wellington’s 89.4 percent and Christchurch’s 74.6 percent.

Auckland-based Frog Recruitment founder Jane Kennelly said there was no doubt more people were working from home.

For example, she knew of a large corporate company with only 10 percent of their staff coming into the office every day.

Kennelly said working from home options were highly desired by Auckland job-hunters.

“Particularly for Auckland, one of the things that we’ve talked about for the last number of years with candidates is their dislike of sitting in traffic,” she said.

“That dead time when you’re in peak hour traffic and it takes so long to get to work.”

There was a strong trend of people opting to work closer to home as well – even if their salary dropped.

In her opinion, the Covid-19 lockdown had opened up a “world of opportunity” in working arrangements for both employers and employees.

“[It has shown] that working from home is a very viable option – that money can be saved, time can be saved, family time can be gained and it’s a significant key attribute in their minds when it comes to their work.”

NZTA’s Auckland system manager Andrea Williamson said fewer people heading to the airport was also contributing to the decline.

She was not certain why Auckland traffic did not bounce back like the other main centres, but she hoped traffic volumes stayed down.

“If there’s less cars on the motorway, then there’s a smaller queue which means that everyone is a little bit happier when they get on the motorway.”

The environment also benefited with fewer cars on the road, she said.

Auckland Transport’s metro services manager Stacey van der Putten said university students – who were not currently on campus – usually made up about 14 percent of public transport users.

This had put a dent in the number of people taking public transport, she said.

Greater Auckland director Matt Lowrie said cycleway data showed more people were jumping on their bike, but they weren’t necessarily heading to work.

“In many of the cycleways there is an increase in usage, particularly some of the recreational ones,” he said.

“But the big commuting cycleways, particularly things like the Northwestern, remain down on what they were last year.”

The smaller rumbling of cars on the road could also be detected underground.

GNS science operation specialist Sam Taylor-Offord said data pulled from a seismic sensor about 40 metres underground at Eden Park illustrated the traffic activity.

Noise levels traditionally peaked during the middle of the week and were quieter during the weekend.

This was stable until Covid revved up in March.

“You can see actually the day that we go into level 4 it hits the floor. It stays there until we hit level 3, then it steps back up. When it gets to about level 1, it actually flattens out.”

He said the data showed the sound levels during the week at level 1 were comparable to weekends in February, before alert levels were introduced.

New initiatives at KiwiRail’s Southdown container transfer site

The following announcement from KiwiRail concerns changes at Southdown.

We’re proud that our Southdown Container Transfer site is the third largest container handling facility in New Zealand and a critical part of many of our customers’ supply chains. Each year we handle around 450,000 TEU through this site.

Over the past five years we’ve invested over $30 million at Southdown to improve service, resilience and support growth:

• Truck entry laneways have been streamlined for KiwiRail, MetroPort and MetroBox container flows
• New top lifters to meet the growing freight volumes
• New reefer towers to handle increasing demand for temperature controlled cargo
• Upgraded rail grids for MetroPort
• Improved site traffic management systems

We’re now about to introduce two new initiatives to further improve the speed and flow of containers through Southdown for our road transport partners.

Vehicle Booking System to speed-up container throughput

With up to 1,200 trucks visiting our Southdown site each day to either deliver and/or uplift containers, and with only the Port of Tauranga’s Metroport part of the site currently operating a Vehicle Booking System (VBS) we are aware that congestion can become a real issue at certain times, as a result of trucking operators having to queue up to enter the site.

To ensure that the whole site is able to run more smoothly and to provide a more streamlined and faster process for all of our customers, KiwiRail is going to introduce a VBS which will apply to all non-Metroport volumes later this year. This will result in a reduction in average truck queueing times across the whole site.

The VBS will be an online tool, using the same product as that used by the Port of Tauranga’s Metroport operation at Southdown.

This will mean that not only will the whole site now use a VBS, but by having the same system as that already in place with Metroport, it should significantly improve the experience for many operators.

By being able to book specific container delivery or uplift timeslots, it will enable truck arrivals at the site to be more evenly spread across each day.

This will result in faster truck turn times due to reduced queuing times, thereby increasing truck productivity and efficiency and provide a general improvement in on-site safety through a reduction in overall site congestion.

Having the same VBS will also help minimise any training requirements, as trucking companies currently servicing Metroport will already be very familiar with using it and for any new users, we will be arranging all necessary training for your staff at no cost to you.

While there will be a cost for the use of the VBS, just as with all other such systems, we are firmly of the view that the improvements this will provide transport operators through increases in fleet productivity, will provide much greater value than the system’s cost to use.

Please note that we are not currently intending to introduce a VBS at any other of our container transfer sites at this time.

We will provide further updates on this initiative once we have a confirmed start date for the system, including how we plan to roll out the required training we will be providing to all new users.

Certified Weighbridge

We are also going to be installing a brand new, fully certified weighbridge at our Southdown site which will be available for use by both customers and the general public.

It will be positioned near the entrance of the site, so it is easily accessible not just for truck operators wishing to enter the site, but also for those who simply want to have their trucks check-weighed.

At this stage we expect the weighbridge to be commissioned and available for use before the end of the year and we will provide you with more information about processes and proposed charges for using it, prior to it becoming operational.

We trust you will find these as positive enhancements to our services and we look forward to being able to commission both in the near future.

Freight company CEO says Manukau Harbour ‘wouldn’t work’ as a Ports of Auckland replacement

A top freight executive says no shipping company would choose Manukau Harbour as a potential new destination for an Auckland port.

A report by economic consultancy Sapere published yesterday ranked Manukau Harbour as the best option. It considered Northport, Manukau, the Firth of Thames, the Port of Tauranga and a shared increase in capacity at both Northport and the Port of Tauranga.

An earlier report, backed by New Zealand First, identified Northport at Marsden Point as the best option. The report was completed by a Government working group led by former Far North mayor Wayne Brown.

Auckland Mayor Phil Goff called the previous Northport work “shoddy” and Transport Minister Phil Twyford said it “had a clearly predetermined outcome” in favour of moving the port to Marsden Point.

New Zealand First still backs Northport as a new location, with MP Shane Jones saying Manukau was the most treacherous harbour in the country and unfit as an alternative site for Ports of Auckland.

Carr and Haslam director Chris Carr said he didn’t know how the Sapere report had come up with Manukau Harbour.

“It’s probably about the only time in the world I’ll ever agree with Shane Jones,” Carr told told Morning Report.

“The prevailing weather comes in on the western side of the country. Ports don’t exist in the west coast of New Zealand, they exist on the east coast.

“I’m no maritime person but all the shipping companies say that they won’t go to the west coast and that in itself would tend to make Manukau the first shipless port that we’d have in the country.

“It’s simply not suitable operationally and it wouldn’t work no matter how much we might try and make it fit.”

If the port had to be moved from Auckland it should be to somewhere ships can get in and out safely, he said.

“You also want to go somewhere near the largest consumption area which is the Auckland-Tauranga-Hamilton-Waikato area.

“The only place you can do that is the Firth of Thames. It’s not ideal.”

He agreed with the Sapere report that Ports of Auckland could keep operating for more than 30 years before it ran out of space where it was.

“But New Zealand’s not good at doing this sort of stuff and we take so long to do it that we need to start working at it and looking at it.

“If you look at it from a logistical point of view, the decisions become quite easy – it’s when you get politics involved it becomes quite hard.

“The shipping companies who in the end of the day determine where their vessels come would not choose Manukau, ever.”

Shane Jones told Morning Report he had come off second best to people opposed to a relocation to Northland.

“I had professionally and personally campaigned with my leader for the expansion of Northport and relocation of Ports of Auckland activity to Tauranga and Northland,” he said.

He invoked the sinking of the Orpheus in 1863, in which 189 people died, as reason to not build a port at Manukau Harbour.

“I will prophesy that a thousand years will pass before a new port will ever be located in Manukau Harbour.

“[The Sapere report] wants to take us over the bar of the most treacherous harbour in New Zealand and dredge to a level of spill that will rival Mt Cook somewhere in New Zealand or it’ll be dumped in the ocean.”

Jones said work on a new port needed to “get cracking” in 10 to 15 years.

“In New Zealand we leave too many infrastructure decisions to the last minute.”

No decision is to be made before the election, leaving it for political parties to campaign on.

Manukau Harbour ‘wouldn’t work’ as new Auckland port

Manukau Harbour would never work as a new location for Auckland’s port, transport company director Chris Carr says.Manukau Harbour

Manukau Harbour. Photo: RNZ / Jessie Chiang

A report by economic consultancy Sapere published yesterday ranked Manukau Harbour as the best option. It considered Northport, Manukau, the Firth of Thames, the Port of Tauranga and a shared increase in capacity at both Northport and the Port of Tauranga.

An earlier report, backed by New Zealand First, identified Northport at Marsden Point as the best option. The report was completed by a government working group led by former Far North mayor Wayne Brown.

Auckland Mayor Phil Goff called the previous Northport work ‘shoddy’ and Transport Minister Phil Twyford said it “had a clearly pre-determined outcome” in favour of moving the port to Marsden Point.

New Zealand First still backs Northport as a new location, with MP Shane Jones saying Manukau was the most treacherous harbour in the country and unfit as an alternative site for Ports of Auckland.

Carr and Haslam director Chris Carr said he didn’t know how the Sapere report had come up with Manukau Harbour.

“It’s probably about the only time in the world I’ll ever agree with Shane Jones,” Carr told told Morning Report.

“The prevailing weather comes in on the western side of the country. Ports don’t exist in the west coast of New Zealand, they exist on the east coast.

“I’m no maritime person but all the shipping companies say that they won’t go to the west coast and that in itself would tend to make Manukau the first shipless port that we’d have in the country.

“It’s simply not suitable operationally and it wouldn’t work no matter how much we might try and make it fit.”

If port had to be moved from Auckland it should be to somewhere ships can get in and out safely, he said.

“You also want to go somewhere near the largest consumption area which is the Auckland-Tauranga-Hamilton-Waikato area.

“The only place you can do that is the Firth of Thames. It’s not ideal.”

He agreed with the Sapere report that Ports of Auckland could keep operating for more than 30 years before it ran out of space where it was.

“But New Zealand’s not good at doing this sort of stuff and we take so long to do it that we need to start working at it and looking at it.

“If you look at it from a logistical point of view the decisions become quite easy – it’s when you get politics involved it becomes quite hard.

“The shipping companies who in the end of the day determine where their vessels come would not choose Manukau, ever.”

Shane Jones told Morning Report he had come off second best to people opposed to a relocation to Northland.

“I had professionally and personally campaigned with my leader for the expansion of Northport and relocation of Ports of Auckland activity to Tauranga and Northland,” he said.

He invoked the sinking of the Orpheus in 1863, in which 189 people died, as reason to not build a port at Manukau Harbour.

“I will prophesy that a thousand years will pass before a new port will ever be located in Manukau Harbour.

“[The Sapere report] wants to take us over the bar of the most treacherous harbour in New Zealand and dredge to a level of spill that will rival Mt Cook somewhere in New Zealand or it’ll be dumped in the ocean.”

Jones said work on a new port needed to “get cracking” in 10 to 15 years.

“In New Zealand we leave too many infrastructure decisions to the last minute.”

No decision is to be made before the election, leaving it for political parties to campaign on.

Claims Ports of Auckland move to Whangārei is impractical just ‘snobbery’

Regional Economic Development Minister Shane Jones has rubbished a trucking association report that says moving Ports of Auckland north would be impractical.

The recently-released report, commissioned by the National Road Carriers Association, looked at the costs and challenges for road freight of moving Ports of Auckland to Northport at Whangārei’s Marsden Point.

Such a move, expected to cost $10 billion, has been favoured by a Government-backed working party, although a final decision on the move is not expected before this year’s election.

Posts of Auckland handles about one third of the nation’s container trade and two million tonnes of general cargo (file photo).
DAVID WHITE/STUFFPosts of Auckland handles about one third of the nation’s container trade and two million tonnes of general cargo (file photo).

But the road carriers’ report said moving Auckland’s port to Northport would be logistically impractical, prohibitively expensive, increase greenhouse gas emissions and add to traffic congestion, by increasing truck trips between Northland and Auckland.

It calculated 340,000 heavy truck trips and 27,000 freight trains would be needed to carry goods from Northport to the proposed inland port at Swanson, in West Auckland, and said current road and rail is not up to scratch.

The National Road Carriers Association says 340,000 trucks and 27,000 freight trains will be needed to transport goods from Northland to Auckland if the ports move (file photo).
ROSA WOODS/STUFFThe National Road Carriers Association says 340,000 trucks and 27,000 freight trains will be needed to transport goods from Northland to Auckland if the ports move (file photo).

The report concludes Ports of Auckland should continue in its current location until it can’t handle further growth, and a super port in the Firth of Thames or Manukau Harbour should be considered as part of a 100-year plan.

But Jones said the report was part of Auckland’s “snobbery” against Tai Tokerau, by favouring a new port instead of the existing deep water port in Northland.

Building a new port in the Firth of Thames would require billions of dollars more than moving to Northport and require an act of Parliament to sign off the resource consent, he said, while using Manukau Harbour would require ships to cross “the most treacherous bar” in the country.

Regional Economic Development Minister Shane Jones says moving Ports of Auckland to Northport makes more sense than trying to build a new port in Auckland.
HAGEN HOPKINS/GETTY-IMAGESRegional Economic Development Minister Shane Jones says moving Ports of Auckland to Northport makes more sense than trying to build a new port in Auckland.

“With Ports of Auckland, there’s no free pass, so obviously I’ve always promoted further utilisation of Northport because it’s got excess capacity, it’s a natural deep access way and it’s a key feature in regional development.”

Jones said the road carriers’ report was also about the trucking industry trying to defend its own interests, which are coming under threat as New Zealand looks to reduce its greenhouse gas emissions, he said.

The port move is reliant on rail and the current Government has already spent more than $200 million on upgrading the North Auckland Rail Line, including $40m to buy land for a rail spur out to Marsden Point which has now been secured, he said.

A further $700m has been allocated to build a four-lane highway south of Whangārei, Jones said.

HOUSEHOLD GOODS WILL INCREASE

But the National Road Carriers Association report has been backed by the Road Transport Forum, which said moving freight Ports of Auckland to Northport was “folly”.

Chief executive Nick Leggett said the plan made even less sense in the post-Covid environment.

“New Zealand cannot bear the brunt of the huge $10 billion upfront capital cost required to get Northport and its road and rail supply lines up to task, let alone the supply chain disruption and the five-fold increase in road transport costs that will hit the pockets of householders directly,” he said.

“All household goods, including groceries, will go up significantly if freight comes into New Zealand some 200km further away from its markets.”

FURTHER INFORMATION TO BE RELEASED

A report on the options for relocating the Ports of Auckland freight functions, undertaken by independent consultants Sapere on behalf of the Ministry of Transport, has now been provided to ministers.

A timetable for the information’s release is being finalised by the ministry but Jones would like it be released in the next 10 days.

The report comes after the Upper North Island Supply Chain Strategy working party, headed by former Far North mayor Wayne Brown, favoured a $10b plan to shift the ports north, recommending it be done within 15 years.

But the working party’s work has been heavily criticised, with reviews saying it failed to provide a credible basis for making a decision on the move.

Cabinet wanted to see more analysis before making a decision. Jones said that decision would now become an election issue.

NZ firms Fletchers and Downer ‘fuming’ as $371m Govt KiwiRail contract goes overseas

Construction companies Fletcher and Downer are reportedly “fuming” after a $371 million Government rail contract has been awarded to overseas companies – costing the Kiwi firms hundreds of local jobs.

Greg Miller, chief executive of KiwiRail at the Otahuhu Auckland depot amongst the trains and shipping containers. NZ Herald Photo by Alex Burton 30 August 2019
Greg Miller, chief executive of KiwiRail at the Otahuhu Auckland depot amongst the trains and shipping containers. NZ Herald Photo by Alex Burton 30 August 2019

One source within Fletchers said the team that worked on the tender is “fuming” that overseas firms have been awarded the Government contract.

The source said the contract would have saved many of the 1000 local jobs slashed late last month in response to Covid-19 economic losses.

John Holland reportedly has only around 10 New Zealand-based staff. Neither John Holland nor McConnell Dowell responded to the Herald on Sunday’s requests for comment.

The contract was one of three projects under KiwiRail’s $1 billion Auckland Metro Rail Programme, which also includes the $315m third main line out of Auckland between Wiri and Quay Park, and further support for the $4.4b City Rail Link.

Fletcher Building chief executive Ross Taylor. Photo/Greg Bowker.
Fletcher Building chief executive Ross Taylor. Photo/Greg Bowker.

KiwiRail chief operating officer of capital projects David Gordon would not confirm the contract was already decided.

“We have not concluded negotiations with any party for this contract, but can confirm we are in discussions with a preferred supplier,” Gordon said.

“We cannot confirm who that preferred supplier is at this time, nor can we disclose information on the individual tenders.”

The KiwiRail Papakura to Pukekohe project - expected to begin at the end of 2020 - includes electrification of 19km of track currently only available to diesel trains in South Auckland. Photo / File
The KiwiRail Papakura to Pukekohe project – expected to begin at the end of 2020 – includes electrification of 19km of track currently only available to diesel trains in South Auckland. Photo / File

The Herald on Sunday was told awarding the contract to John Holland and McConnell Dowell came down to a cheaper tender.

Gordon admitted price estimates were a factor in judging the applications.

“We can confirm that the weighting applied for the contract, and disclosed to bidders at the outset of the process, was 70 per cent for non-price attributes and 30 per cent for price,” Gordon said.

“All bidders were required to demonstrate how they will support New Zealand manufacturing and industry for the materials supplied.”

Steve Killeen is chief executive of Downer New Zealand. Photo supplied to the New Zealand Herald
Steve Killeen is chief executive of Downer New Zealand. Photo supplied to the New Zealand Herald

Minister for State Owned Enterprises, Winston Peters, would not be drawn on the wisdom of the KiwiRail electrification contract going overseas, but pointed out the unsuccessful firms could still win another $315m Auckland rail project soon.

“KiwiRail cannot be influenced by ministers in their tender process, and must follow government procurement rules, which at this time do not allow them to discriminate against foreign-owned companies,” Peters said.

“However, companies that work on infrastructure projects, whether foreign-owned or locally owned, are encouraged to use New Zealand sub-contractors and workers wherever possible.”

He said Fletchers could still apply for the major Wiri to Quay Park project.

“If Fletchers claim that they are laying off 1000 staff due to missing this tender then such an excusatory claim won’t meet close scrutiny – because it is simply not true.”

The $371m project to electrify 19km of track is expected to begin at the end of the year and includes two more platforms at Pukekohe station and future proofing for extra lines.

Only diesel trains can operate between Papakura and Pukekohe, so passengers from south of Papakura must switch trains to get to and from the city.

Electrification will improve commuter capacity.

KiwiRail chairman Greg Miller (left), acting chief executive Todd Moyle, Deputy PM Winston Peters and Regional Development Minister Shane Jones. 31 January 2018 Northern Advocate Photo by Tania Whyte
KiwiRail chairman Greg Miller (left), acting chief executive Todd Moyle, Deputy PM Winston Peters and Regional Development Minister Shane Jones. 31 January 2018 Northern Advocate Photo by Tania Whyte

Busy work programme begins for Auckland rail – KiwiRail

Friday, 22 May, 2020

KiwiRail teams will be working hard over nights and at weekends throughout winter to build a better rail network for Auckland.

Work will begin this weekend to replace almost 12 kilometres of old rail and more than 2500 sleepers on the busy Eastern Line between Britomart and Otahuhu, says KiwiRail Chief Operating Officer Todd Moyle.

“Aucklanders are using the rail network more and more, with 3,500 commuter services and 246 freight trains in a typical week.

“That amount of rail traffic causes wear and tear on the rails over time, just as heavy traffic does to road surfaces, and in some cases we have to put speed restrictions in place. It is critical that we replace the rails so we can keep trains running efficiently and safely on the network for the thousands of rail commuters.

“Getting this work done will enable us to remove speed restrictions on the line and when finished, commuters will enjoy a quicker, smoother and quieter journey.

“Replacing the rail and sleepers can only be done when no trains are running. We have worked closely with Auckland Transport to settle on a work programme that allows us to minimise disruption for commuters while enabling us to get the work done efficiently and safely.

“Around 200 people will be working on the project, including 85 from outside Auckland who are being brought in to ensure the work is done as quickly as possible.

“Trains will be replaced by buses during evenings and at weekends when there are fewer commuters using the services, so our teams can get out to do the work. We understand this may be disruptive for those who use the trains at these times, however these closures mean we can get the work done much more quickly, so there is less overall disruption.

“We are conscious that this work may also cause some disturbance to our corridor neighbours. Our teams are focused on getting the work done as quickly and quietly as possible.

“We are working progressively across the entire network to replace the oldest and most worn sections of track, with 23km of new rail already in place across the network since March 2019. This period of work on the Eastern Line will take about eight weeks, with more work planned for late September.

“The work forms part of an ongoing project to improve the Auckland network, lay a foundation for predicted growth in passenger and freight volumes, and ensure the benefits of the City Rail Link can be delivered.”

Covid 19 coronavirus: 2500 construction workers set for work on transport projects

Auckland Transport will reopen 160 worksites and get 2500 workers back on the job next week. Photo / Michael Craig
Auckland Transport will reopen 160 worksites and get 2500 workers back on the job next week. Photo / Michael Craig
Ben Leahy

By: Ben LeahyBen Leahy is a reporter for the New Zealand HeraldBen.Leahy@nzherald.co.nz

Around 2500 construction workers are set to head back to work on Auckland Transport projects next week.

AT had earlier closed down 160 worksites across the city during the Covid-19 alert level 4 lockdown, but they would now reopen from next Tuesday.

“These projects are worth hundreds of millions of dollars,” AT chief executive Shane Ellison said.

“Some are high profile, like the huge Eastern Busway project, the Downtown programme and Karangahape Rd enhancements, while others are smaller local projects, like road sealing, footpath works and building pedestrian crossings.

Auckland Mayor Phil Goff said getting the 160 sites going again would be a big boost for the local economy, but it wouldn’t be the only one.

The Government announced in January it was putting up money under the Infrastructure Upgrade to invest in a series of big projects.

Goff said new projects that were shovel-ready and able to tap into that funding would be announced next month.

Getting worksites up to new safety standards was important, he said.

“But it’s also important that we can start to regenerate economic activity and contribute to a growth of income and jobs needed to drag the city and country out of recession.”

AT’s Ellison said that while reduced traffic on city streets offered a great chance to get on with the projects, going back to work would look different for some time into the future.

“Lunch break, for instance, is going to be very different with the workers still having to maintain safe distancing and bubbles,” he said.

Each project site has developed a health and safety plan based on Ministry of Health guidance and the Covid-19 Standard for NZ Construction Operations.

These measures include physical distancing, construction bubbles, compulsory personal protective equipment, hygiene practices on-site and separating teams into zones on larger projects.

One of AT’s most high-profile projects was in the city centre, where 190 construction workers would be back on the job from Tuesday.

Programme director Eric van Essen said workers would be kept in about 30 bubbles on six sites.

“Each worker will be assigned to a bubble and, if they need to go between bubbles, they will have to wear a mask and keep 2m distance.

“We will keep a strict record of anyone entering or leaving a bubble, including anyone making site deliveries,” van Essen said.

The first activity on the site will be setting up cleaning and hygiene stations and bubble entry and exit points.

“We will do this preparation work ahead of Tuesday and then be ready when alert level 3 kicks in on Tuesday and the workers turn up for this new, more challenging way to work.”

AT said it had helped construction companies keep workers in jobs by making $18 million in advance payments to contractors on existing projects.

The cash injection came through an Advance Entitlement Payment scheme for construction contractors, with the NZ Transport Agency also offering a similar scheme to its contractors.

How AT plans to keep workers safe during alert level 3

* Inductions for new project staff and compulsory Covid-19 education and training will be part of ongoing site protocols while in level 2 and 3 scenarios

* Crews will stay in their work bubbles when travelling to and from work and while at work and going on toilet and meal breaks

* Whenever possible, individuals will maintain at least 1m distance from others.

* There will be no entering other work bubbles unless prior approval is granted.

* Masks will be worn if individuals are working within 2m of their team member or enter a different bubble.

* There will be no sharing of any food, drink or cigarettes or kitchen utensils, cups, plates and other equipment.

* There will be no sharing of plant, equipment and tools across bubbles and there will be minimal sharing within each work bubble.

* All crews are to follow hygiene guidance.

* All crews are to follow existing PPE requirements, including the wearing of gloves and safety glasses.

* No person is to come to work if they, or any members of their home bubble experience flu-like symptoms.

*Every person is to keep a record of all interactions with anyone outside of their home and work bubbles in case contact tracing is required.