Rena oil spill: Missing $12m cover 'Govt error'

The clean-up had so far cost around $4 million. Photo / APNZ

The Government admits it has "dropped the ball" by failing to sign up to an international convention that would have protected taxpayers by an additional $12 million for the cleanup of the Rena oil spill.

But it is laying the blame at the feet of governments past and present.

Under the Maritime Transport Act the ship's owner is liable for up to $12.1 million but this amount would have doubled to $24 million if the Government had signed up to the International Convention on Civil Liability for Bunker Oil Pollution Damage.

Parliament's transport and industrial relations select committee recommended passing a law that would have achieved this in August 2008.

Labour leader Phil Goff said the minister was advised when he came into office at the end of 2008.

"Why didn't this happen? Three years after National first was told it needed to update legislation, nothing has been done.

"Taxpayers and business owners in Tauranga who are already feeling the affects of the Rena oil spill disaster are picking up the tab for National's incompetence."

According to the International Maritime Organisation, the convention was adopted in 2001 and came into force in November 2008.

Transport Minister Steven Joyce said it was "frustrating" that the Government had not made the move, but the convention was updated in 1996 and "Labour didn't do a thing with it either before or after that".

"In Phil's case they've cared so much about it that they haven't raised it at all with the Government at any stage over the three-year period.

"Broadly speaking, successive governments have dropped the ball."

Mr Joyce said Labour had given the legislation the lowest priority.

"I was unaware at that time as to the nature of the change in liability. Unfortunately it was never drawn to Cabinet's attention and never drawn to my attention."

The law is mentioned in the Briefing to the Incoming Minister to have been introduced in 2009, but the briefing only refers to a "number of international conventions and protocols that have been recommended".

Mr Joyce has called a meeting today with officials from the Mediterranean Shipping Company, which chartered the Rena from Costamare, to "make sure they understand how New Zealanders see this".

MSC has released a statement saying they are not responsible for the vessel or its management.

Mr Joyce said the clean-up job had so far cost about $4 million and he would not be surprised if the final bill exceeded the $12.1 million liability cover - depending on how much more oil leaks.