New report shows major downsides to Ports of Auckland privatisation scheme

A new report com­mis­sioned by the Mar­itime Union of New Zealand shows major down­sides to any pri­vati­sa­tion of oper­a­tions at the Ports of Auck­land.

The report enti­tled “The costs and risks of pri­vatis­ing Ports of Auck­land oper­a­tions” draws on inter­na­tion­al research includ­ing the expe­ri­ence of Aus­tralian ports in recent years.

Auck­land Coun­cil is review­ing options to sell an oper­at­ing lease for the Ports to a glob­al net­work ter­mi­nal oper­a­tor, and has com­mis­sioned con­sul­tants to seek expres­sions of inter­est.

Mar­itime Union of New Zealand Nation­al Sec­re­tary Craig Har­ri­son says a key con­cern com­ing out of the report is the poten­tial for price hikes hit­ting port users – then being passed on to local indus­try and con­sumers.

Mr Har­ri­son says pri­vati­sa­tion of oper­a­tions at Ports of Auck­land is esti­mat­ed to hit local port users with NZ$70 mil­lion in extra costs annu­al­ly.

“Any pri­vate oper­a­tor in Auck­land would be in a monop­oly posi­tion and would seek returns on its invest­ment, on top of the lease cost – the prof­it has to come from some­where.”

He says pri­va­tised port oper­a­tions in Aus­tralia have seen sur­charges of over AU$100 per con­tain­er imposed on port users, who have no oth­er options.

“The failed automa­tion exper­i­ment at Ports of Auck­land shows there is no fat to be cut at the Port, and pri­vate prof­it through pri­va­ti­za­tion would be extract­ed from port users and the local econ­o­my.”

Mr Har­ri­son says the pri­ma­ry val­ue of the Ports of Auck­land is how it facil­i­tates trade.

He says there is grow­ing con­cern there is no clear strat­e­gy for the Ports and deci­sion mak­ing is being dri­ven on a short term, ad hoc basis.

“The Ports of Auck­land is going through the a peri­od of growth and sta­bil­i­ty under new lead­er­ship with improv­ing returns, and should be left to get on with the job and not med­dled with.”