Answers needed on KiwiRail – Fonterra deal

The Mar­itime Union has stepped up its demand for answers as fall­out con­tin­ues from Fonter­ra’s dump­ing of region­al ports in favour of long dis­tance rail – and the influ­ence that state sub­si­dies to KiwiRail may have had on any deal.

KiwiRail has wad­ed into the grow­ing debate over the fate of region­al ports, as the impli­ca­tions of Fonter­ra’s with­draw­al from ports in New Ply­mouth and Timaru becomes appar­ent.

KiwiRail chief exec­u­tive Jim Quinn was report­ed in the Tarana­ki Dai­ly News (29 August 2009) say­ing any Gov­ern­ment sub­sidy was irrel­e­vant to the Fonter­ra deal but that KiwiRail did need the sub­sidy.

Mar­itime Union Gen­er­al Sec­re­tary Trevor Han­son says that the sit­u­a­tion has obvi­ous­ly blown up in Fonter­ra’s face and it need­ed to be held to account.

He was not sat­is­fied with KiwiRail’s answers and said “either they are being sub­si­dized or not, and we believe there is more to this sit­u­a­tion than region­al com­mu­ni­ties are being told.”

Now the Mar­itime Union for pub­lic meet­ings to begin “active resis­tance” to the actions of Fonter­ra.

Mr Han­son says there should be imme­di­ate pub­lic meet­ings orga­nized to bring togeth­er those affect­ed by the deci­sions – ports, local coun­cils, farm­ers, mar­itime work­ers, local busi­ness­es and all affect­ed cit­i­zens, to demand some input into such deci­sions.

He says locals need to fight back against the destruc­tion of these ports, and ulti­mate­ly the dam­age to their region­al com­mu­ni­ties.

The Union is also demand­ing answers from the Gov­ern­ment as to how tax­pay­er fund­ing of KiwiRail is being allowed to threat­en the future of region­al ports.

“The Gov­ern­ment has the end respon­si­bil­i­ty here to step in for the nation­al inter­est. To stand aside and let these heart­land com­mu­ni­ties have their infra­struc­ture and trans­port sys­tems effec­tive­ly demol­ished by a five hun­dred pound goril­la called Fonter­ra is show­ing that it either has no idea or the wrong idea.”

Mr Han­son says the both of these ports are capa­ble of han­dling their local car­goes – with­out sub­si­dies.

He says the mon­ey these ports have invest­ed in infra­struc­ture to han­dle Fonter­ra’s trade has effec­tive­ly been flushed down the drain.

“The ques­tion needs to be answered – is the Gov­ern­ment aware of any influ­ence of sub­si­dies on the price of the move­ment of car­go on rail hun­dreds of kilo­me­tres away from its region­al catch­ment?”

“Both ports need to ask the Gov­ern­ment to put Fonter­ra’s activ­i­ties on hold until a true cost of their deci­sion has been inves­ti­gat­ed.”

Mr Han­son says for some time there has been strong advo­ca­cy for the use of coastal ves­sels to move car­go out of the sec­ondary region­al “feed­er” ports to major export­ing “hub” ports.

He says this strat­e­gy has now been “blown out the water” with­out expla­na­tion or dis­cus­sion in the indus­try.

Mr Han­son says Fonter­ra ship­per Maer­sk needs to state its posi­tion as one of the largest ship­ping oper­a­tors in the world.

“Maer­sk has described itself as a social­ly respon­si­ble com­pa­ny and will be very aware of the dam­age caused to regions and com­mu­ni­ties from Fonter­ra’s actions.”

“We have to won­der if Fonter­ra has oth­er ship­ping options under study, and what effect this could have.”