Expert says council is behind wharf strife

Ports of Auckland workers man the picket line outside the Port yesterday. Photo / Dean Purcell

The industrial strife on the Auckland wharves is the result of pressure on the Ports of Auckland board to make more money for the Auckland Council, says a ports expert.

Dave Wigmore, of financial services firm Jones Lang LaSalle, yesterday said the new board had a mandate to increase the dividend paid to the council, which owns 100 per cent of the port company.

"As a result of that they've been looking at operational improvements and other things and I think this industrial action is a direct reflection of that," said Mr Wigmore, whose firm has a long involvement with the port company.

Since the Super City came into being 14 months ago, the Auckland Council has instructed the new board to double its dividend from a 6 per cent rate of return to 12 per cent over five years. The company currently pays a dividend of about $18 million to its shareholder.

Last night, Mayor Len Brown refused to respond directly to Mr Wigmore's claims that pressure from City Hall was behind the industrial action, saying only that the board understood the need for the port to become more competitive and boost the return on ratepayers' investment.

The company and the Maritime Union have been locked in a bitter dispute since before Christmas.

About 330 union members are on strike for a 48-hour period that ends at 11pm today.

Ports of Auckland boss Tony Gibson has run out of patience and begun taking steps to replace striking workers with private contractors.

Yesterday, Mr Gibson briefed about 150 staff members, including a handful of union members, about the contracting-out proposal.

A handout from Mr Gibson said the ports company had an obligation to provide a reasonable rate of return on the community's investment with the company, setting a minimum rate-of-return target of 8.2 per cent.

"Achieving this target in the present economic climate requires POAL to significantly improve its operational productivity and efficiency. To do this, the company must [lift] its current labour utilisation rate from 65 per cent to over 80 per cent, just to remain viable," the handout said.

Mr Gibson said the recent loss of business by Maersk and Fonterra could cut port revenue by $25 million a year with no perceived opportunity to replace this revenue.

Most of the the 330 striking workers did not attend the meeting.

Maritime Union president Garry Parsloe said union members did not want to listen to Mr Gibson tell them they would be made redundant and sent down the road.

"They are not masochists," he said.

To boost productivity, the port company has offered union staff a 10 per cent pay increase on existing wages of about $27.40 an hour (with added bonuses) in return for replacing eight-hour duties with shifts ranging from five to 12 hours. Mr Parsloe said the changes undermined job security and amounted to casualisation of the workforce.

But Mr Wigmore said the attempted changes were in line with international trends. "From our work with other ports around the world, this is just a consistent trend ... ports are having to move away from the rigid labour models that have been run in the past to more flexible ones," he said.