Auckland Council a 'lazy' port owner, time to stop hiding behind port law: councillor

There have been three deaths at the port in recent years. Photo / Michael Craig

A special stopwork meeting over worker safety at the Ports of Auckland is likely this week as a senior Auckland councillor says the council has been a "lazy hands-off owner" of the country's main imports gateway.

Councillor Chris Darby said the council has been "hiding behind" the Port Companies Act and failing to show leadership.

"Our hands-off approach has contributed to the well documented challenges the port faces and subsequent erosion in value. Time's up," he said.

Mayor Phil Goff responded that the Act meant the council "can't cut across" a commercial operation, and until 2019 the council was also blocked from direct involvement by a council created entity, Auckland Council Investment Ltd, which he moved in 2018 to disestablish.

He and the council were working to change membership of the port's board of directors.

"With the safety issue we took the probably unprecedented step of directly involving ourselves operationally by ordering an independent committee of inquiry. We've now got the report and we've got a blueprint for the board to be held to account by us to implement it."

Goff said the council didn't have the skills to manage the port but it did have the ability to appoint a board to oversee the chief executive and management and exercise goverance "in an authoratitive way".

Meanwhile, the Maritime Union of New Zealand is waiting to hear from port management after requesting a stopwork meeting for all members to discuss the report which found systemic problems with health and safety.

Union secretary Craig Harrison, who has called for port chief executive Tony Gibson to resign over safety failures, said the union can call three stopwork meetings a year, but the report by Construction Health and Safety New Zealand (CHASNZ) warranted a special meeting. The port's board of directors would be invited.

The union represents 164 of the port's estimated 220 stevedores. There have been three deaths involving the port since 2017, the latest last year when a stevedore was killed.

Darby has put questions to senior council staff over the council's actions regarding the port company under section 9 of the Port Companies Act 1988. The section relates to a company's annual statement of corporate intent.

He's asked if: council management is confident the council has, and is, exercising all possible direction of the port company through this section of the Act; how it has explored and exerted direction, particularly through this section, in the past five years; when the council first expressed concerns for welfare and safety through the statement of corporate intent.

Darby last year unsuccessfully proposed to the council that half the port be transferred to the Government.

"My earlier proposal to transfer 50 per cent of POA to Government forms part of the strategic pathway to confirming a new upper North Island port and deliberately unlocks the inertia that stops council, and for that matter government, thinking long and smart.

"We have been a lazy hands-off owner more interested in the dribble of dividends than keeping our eye on the potential of a multi-billion dollar asset that is the cornerstone of the Auckland and upper north economy.

"Hiding behind the Port Companies Act is a lame excuse for not demonstrating leadership."

The port has also been under fire for low productivity at a time of high consumer demand for imports, and there are questions about a secretive five-year-old container terminal automation project, still not fully implemented.

Asked by the Herald if part of the port company should be listed on the sharemarket to make its performance more transparent, Darby said a private equity stake would eventually be needed to fund a new port.

The council did not, and would not have, the balance to support what could cost $10 billion.

"We will require a commercial partnership to embark on that capital-rich task. I foresee Auckland council, Government, Port of Tauranga and Northport/ Marsden Maritime Holdings all being potential stakeholders.

"If it plays its cards right Auckland Council could retain a significant equity stake in a future port as it transfers the value of POA to a new publicly-listed entity. Suggestions that the big prize is owning the port land outright is also fraught with little understanding of the costs and benefits.

"It will be no surprise to me that to achieve best value for the post-port land will require significant costs in decontaminating a century-old industrial site.

"We have already learned that lesson at Wynyard Point."

Auckland Councillor Chris Darby. Photo / Greg Bowker

Darby is also on the warpath over a container ship carrying Auckland cargo having to divert last week to Northport, after councillors were assured by port management it was on top of the ship congestion that's dogged the port for more than six months.

A shipping line notice to customers said the Constantinos P would call at Northport "as a force majeure event instead of Port of Auckland". The vessel arrived at Northport, south of Whangarei, on March 31 and departed on Saturday.

Because of the long Easter weekend, transport to Auckland of the 1160 containers unloaded was delayed until Tuesday, April 6. It's the second call by this vessel to Northport because of Auckland port congestion. Dozens of trucks carted the containers south on its previous visit just before Christmas.

A Whangarei-Auckland rail link was not operable at that time. KiwiRail said it would begin shifting containers from the Constantinos P on Tuesday.

A Ports of Auckland spokesman said at the recent council-port management meeting Darby referred to, port chief executive Gibson only said the situation was "improving".

The port's latest update to the market on March 30 said the four week average for original (vessel) ETA to berthing was 4.6 days, down from 6.2 days. The latest ETA to berth time was 3.6 days.

"The number is a four-week average so it does fluctuate but the overall trend is down."

Darby was also probably not aware that the Constantinos P was being dehired soon and in order to meet the dehire schedule it couldn't afford any delay in Auckland on this trip, so went to Northport, the spokesperson said.