The vessel had the equivalent of third-party insurance, to provide some cover for salvage and clean-up, but the ship itself wasn’t covered by insurance.
It’s understood insurance would not cover the full cost of salvage and clean-up.
“Historically, Royal New Zealand Navy [RNZN] vessels aren’t insured due to the prohibitive cost, that’s been the case of successive Governments,” Finance Minister Nicola Willis said.
Professor David Capie of the Victoria University of Wellington Centre for Strategic Studies said the loss of the Manawanui was a huge blow to what was already a small Navy.
“New Zealand’s Navy has been under huge pressure in the last few years because of a lack of people, especially in some highly skilled positions like senior maritime engineers,” Capie said.
“That’s meant we simply couldn’t put a lot of ships to sea.”
Capie said New Zealand had six ships it could use before the loss of the Manawanui.
“When you think about New Zealand’s enormous maritime environment and the increasing calls on the Defence Force for responding to disasters, fisheries patrols, as well as a much more challenging strategic environment, and you only have five ships, that’s a really concerning place to be.”
Prime Minister Christopher Luxon said on Tuesday morning that the replacement for the HMNZS Manawanui would depend on funding priorities.
“Now, with an unanticipated loss, we’ll have to consider that,” Luxon said.
Expert John Battersby told the Herald’s The Front Page podcast this week that a new vessel sinking a few years into service was not a good look.
“We have to take that one on the chin. We have taken a hit here. We have lost a vessel in peacetime,” Battersby said.
Defence Minister Judith Collins was already on notice over the parlous state of our armed forces.
Documents released through the Official Information Act also revealed the dire state of readiness of our Defence Force, with the NZDF making “retention payments” to try to stop people from leaving critical roles.
There was the need for a lot of money to be pumped into the NZDF – and Collins delivered a Budget increase in May of $571 million (mostly over four years).
With the sinking of the Manawanui, it’s clear far more funding will be needed to shore up our military.