Kiwiblog

The Herald editorial:

Council should give clear message to port company The Auckland port company is proving very slow to get a simple message: the Waitemata is not to be narrowed. The harbour is still wide enough between the wharves and Devonport to retain its visual splendour but it is not so wide that it can continue to accommodate wharf extensions without losing much  its expansive character.

If the city is not very careful it could discover, too late, that yet another incremental reclamation (one is already underway) has reduced the harbour entrance to a shipping channel and Auckland, quite suddenly, is less scenic.

How hard can it be for the port company to understand this? Having failed to get extended reclamations written into the Auckland Council’s 30-year plan last year, the company has come back this year trying to get a smaller extension written into the council’s 10-year unitary plan.

But really the council is to blame. Instead of giving its wholly owned company a clear message the first time around that no further encroachment on the Waitemata can be contemplated, the council prevaricated. It promised to review a range of development options for the port.

I feel sorry for the current Ports of Auckland management. It is not their fault they have inherited the Port on the location it is in. But my view is that their current location is an awful place for a commercial port, as is Wellington’s Centreport location. The power of the status quo may mean that it is never economic to move them, but the reality is that trying to expand on their current locations is just a very bad idea.

Auckland’s port serves the country’s largest population centre. It is hardly going to disappear if its wharves are not long enough for the next generation of cargo ships. If those ships went instead to Marsden Pt or Tauranga fewer containers would be hauled into the city. But if Ports of Auckland wants to accommodate bigger ships it must find room within its present area. The council should say so.

I agree.

An excellent column by Brian Gaynor:

The writer expressed his strong opposition in the following way: “The [asset sales] represent asset stripping. They are publicly owned by everyone, including poor people. The dividends they produce will no longer be returned to the population as a whole but to a small, wealthy minority. There is no innovation or expansion, just a continuation of the rich getting richer, and the poor poorer”.

Gaynor first points out:

The first point is that the sale of 49 per cent of MRP to 300,000-plus New Zealanders is not asset stripping as none of the company’s assets will be sold for the benefit of the Crown or the new minority shareholders.

And in fact a mixed ownership model will allow the former SOEs to acquire more asset and expand, if they so wish.

The second point is that the Government will continue to receive 51 per cent of MRP’s dividends and the payout should increase in the years ahead.

Port of Tauranga is a good example of this.

The Mount Maunganui company listed on the NZX in March 1992 after the public acquired a 44.7 per cent shareholding. The Bay of Plenty Regional Council owned the remaining 55.3 per cent.

Port of Tauranga paid a total dividend of only $2.2 million in the year before its NZX listing and the Regional Council’s shareholding was worth just $44 million at the $1.05 a share IPO price.

Twenty years later the Bay of Plenty Regional Council’s economic interest in the port company has increased as follows:

The council’s shareholding has declined from 55.3 per cent to 54.9 per cent but the value of its holding has soared from $44 million to $1.015 billion.

The council now receives an annual dividend of $34.6 million from the port company compared with just $2.2 million when it owned 100 per cent.

This is the model that the unions and their allies have tried to destroy.

Everyone is a winner – the Bay of Plenty Regional Council and its ratepayers, Port of Tauranga’s minority shareholders and the company itself.

It is totally inappropriate to look at partial privatisation as a zero sum game, a game where there must be a loser for every winner. Partial privatisation can lead to a substantial increase in value and income for a regional council, or the government, if the listed company is well governed and managed.

Absolutely. There can be no argument that privately owned and managed companies do better overall than wholly owned public ones. By this I do not mean no private companies fail and no public companies succeed. Of course not. But if you look at decades of economic data across OECD countries, the difference is stark.

And Gaynor gives a local example:

In the following 12 years, before the company was taken over by its majority shareholder, the Auckland Regional Council’s economic interest increased as follows:

The council’s shareholding remained at 80 per cent but the value of its holding soared from $318 million to $678 million at the $8 a share takeover price

The council’s annual dividend from the port company jumped from $8.5 million to $34.3 million.

The company’s performance has been poor since it was fully acquired by the Regional Council, now Auckland City, in 2005.

Auckland City’s annual dividend has fallen from $34.3 million in 2005, when it owned 80 per cent of the company, to $20.1 million in the June 2012 year, even though it now has 100 per cent ownership.

When a company is 100% owned by the Government (or a Council), it will make sub-optimal decisions due to influence of the shareholder.

If they are listed on the NZX they have a legal duty to treat all shareholders equally and do what is best for the company as a whole. If the major shareholder wishes to influence their decisions they have to do so transparently through public shareholder resolutions.

Bernard Orsman at NZ Herald writes:

Auckland has a choice if it wants to open up more of its waterfront – let the port expand into the Waitemata Harbour or lose cargo to Tauranga and Northland.

An independent study on freight demands of the three North Island ports shows Auckland cannot open up Captain Cook and Marsden wharves to the public without having to fill in more of the harbour or limit the amount of cargo it handles.

That would lead to the economic benefits from Ports of Auckland going to Port of Tauranga and Northport.

I think the long-term future is to move the Ports of Auckland to another location. It is silly to have prime beautiful waterfront land taken up by a commercial port. The same goes for Wellington.

Even with “very significant operational efficiencies”, the study said, Ports of Auckland would still need extra berth and storage space by 2041 to cater for growth.

And the public won’t wear a growth in area in its current site, so a new location is the only way to expand.

NZ Herald reports:

Two Auckland Council members are complaining of threatening phone calls from a man trying to make them support a no-confidence vote against the Ports of Auckland management.

No vote was put to a council meeting yesterday, but Sir John Walker and Calum Penrose are angry about the calls, from veteran protester Marx Jones.

Somehow I think the name is very appropriate.

Sir John said a threat was made to him through his wife, who was told “they were going to take me to court, they were going to get at me because of the way I’d been voting”.

He said that was rubbish as he was away when a vote was last held on the port dispute, and he did not like his wife being threatened.

Mr Penrose said he was threatened after telling a caller on Tuesday that he would “definitely” not support a motion against the council-owned port company.

“He [the caller] said, ‘We are going to sue you individually, as councillors, and then we are going to have you sacked. And then we are going to get you’.”

Just more intimidation.

Sigh – another sloppy story.

The Herald reports a NewstalkZb story:

Auckland’s Local Boards are demanding action on the ports dispute.

More than 30 members have told the Council it’s time to stop sitting on its hands, and step in.

Board member Michael Wood says the port’s management and board are out of control, and exposing the city’s economy to an enormous risk.

The Boards have not demanded anything. 30 assorted board members (most of whom will be union backed Labour Party candidates or activists like Michael Wood) have demanded something.

There are a total of 148 local board members, so this Labour Party grouping represents around 20% only.

Paul Holmes writes in NZ Herald:

 I formed the view that the ports company have not been ungenerous in their offers to the union. In fact, even Auckland Mayor Len Brown himself agreed that the company’s first offer made early last September should have been accepted.

The offer would have rolled over the collective agreement and given the workers a 2.5 per cent pay increase each year for three years. There were several offers but early on the company decided it could no longer tolerate its workers getting paid for sitting around doing nothing.

I do not believe the union when it says that it’s a lie that the workers earn in excess of $90,000 for an average 26 hours work. Ports of Auckland had Ernst and Young audit the figures. And that’s something you notice about the ports’ conduct throughout the dispute. They’ve done things very thoroughly.

The union’s argument that its people ceasing to be permanent staff would mean that their families couldn’t plan things was obliterated by the company’s offer to roster the men for 160 hours a month, and the roster delivered a month ahead. For the life of me, I can’t see what’s wrong with that.

I think the union was dyed in the wool. I think they didn’t read the signs. Before they knew it, it was all over. Nearly 300 men were made redundant, just like that. End of story. I think there were some hardliners who’ve buggered things up for everyone. Hysteria is never a good thing.

MUNZ turned down a sgnificant pay rise and a guarantee of 160 hours a month, with rosters known a month in advance. By turning it down, their name is now going to stand for More Unemployed New Zealanders.

Conor O’Brien at NBR reports:

Half of the Maritime Union’s bargaining team were disciplined and two were sacked during collective agreement negotiations with Ports of Auckland (PoAL),NBR Online can reveal.

PoAL’s organisational strategist Rod Lingard says a series of disciplinary actions made the union look like a “biker gang” rather than a responsible union in the modern era.

“Of the eight people in the union’s bargaining team we have had to discipline four of them,” Mr Lingard says.

Now what were they disciplined for? Was it just because they were union delegates?

Mr McKean was sacked on September 20 for publishing a racist and sexist piece in the union’s national magazine.

We have profiled Mr McKean’s work before.

Mr Harrison was sacked on January 24 after an investigation concluded he made violent threats against a non-union employee and his family, calling the employee a “f**king piece of s**t”.

Charming.

Mr Findlay was given his final warning after he took a letter from under his manager’s locked door using a ruler.

Oh, a thief.

Another PoAL employee Andrew Angus, a former member of the union’s executive, was dismissed after writing the following job application and posting it anonymously under an administrator’s door. 

Kia ora bro,

I wish to make application for the the position of ship Leading Hand. I feel too intellegant to drive straddles all my life. If it helps I can do a month or two on the sunbed- My great grandfather was one of the priests for the Island of Tualvau and he taught them bannans grown on trees. 

Yours the Best Billy.T. James

Mr Angus was reinstated while his case was heard by the Employment Relations Authority but was sacked a second time after he was caught on camera throwing a twist-lock under a straddle crane. Twist-locks are used to secure containers together on board ships and can cause straddle cranes to tip if they get caught under their wheels. 

Good unions work to have safer workplaces, not sabotage equipment.

Mr Lingard says a fifth union member, official delegate Dave Phillips, who was not employed by PoAL, was served a trespass notice in December after he entered the port’s mess-room and threatened non-union employees with violence.

Remember MUNZ is a proud affiliate member of the Labour Party, and Labour MPs are down on their picket line.

UPDATE: And another MUNZer speaks up to Whale:

Message: u leave cecil walker alone u bastard do u get off on thiskind of stuff tell u what anymore comments about my bros personal life an u r going to get utu i aint fuken jokn etha its not hard to findout were u r so back off

That’s very sad. Not the threat so much – they have a well documented history of threatening and intimidation. But the child like text speak in an e-mail. Please tell me that man is not in charge of a crane somewhere.

The NZ Herald editorial:

Courage in politics too often goes unnoticed, especially when it requires silence. Auckland’s mayor has shown remarkable courage over the past week, resisting pressure to call the Auckland Council’s port company to heel in the current dispute. Some of that pressure has been exerted in public, by commentators, union leaders and a protest march in sympathy with the sacked watersiders that the Labour Party’s leader saw fit to attend. But just as much pressure will have been coming on him in private, from Labour members of the Auckland Council and party activists who helped him get elected.

The latest challenge for the Mayor is one of the Labour Councillors, Richard Northey, has moved a motion to have a Council committee declare opposition to the Ports restructuring, which would humiliate Len Brown if it passes.

The contractual stevedoring arrangements the company wants to make would match those its nearest rival, the Port of Tauranga, has enjoyed for many years.

They were introduced at Tauranga without the strife that has disrupted the Auckland port for so long now, and members of the Maritime Union are still employed on Tauranga’s wharves.

The Port of Tauranga is only part-owned by its local authority. There can be little doubt partial privatisation makes a difference. Boards of directors can more easily resist political pressure when they owe a duty to private as well as public shareholders. More important perhaps, trade unions know this. They cannot as readily bring political pressure to bear in a dispute.

This is absolutely true. The union becomes far less reasonable, because it has lackeys on the local authority who will interfere on their behalf.

The other advantage of the PoT model is that it allows the employees to become share-holders, as 90% of stevedores at Tauranga are.

The best argument for a partial sale of Ports of Auckland Ltd would be intervention by the mayor and council in this dispute.

Mr Brown knows this very well. It is he, almost alone in public now, who is doing the most to show that assets in full public ownership need not be a pushover in labour bargaining. This is the first step, and probably a necessary one, on the path to proving that assets in public ownership can be competitive with private enterprise in every way.

If Northey wins the vote, it will be a classic case of politicians interfering to benefit their donors and supporters.

All of them are at least half-owned by local councils. Had they been fully privatised there is no doubt we would have seen mergers and rationalisation that would have produced better returns for private shareholders, more efficient transport networks for the whole country and more bargaining strength for the ports in negotiations with shipping companies.

If this sort of rationalisation is possible with ports in council ownership, the largest port will need to lead the way. If Ports of Auckland Ltd can get close to the rate of return the mayor has set, it will be in a more dominant position than it has ever been.

But that all depends now on Mr Brown’s courage. Can he see it through?

This is a huge test for Len. Can he defeat Northey?

On the issue of too many ports, that is a view shared by the PM:

A concession from the Prime Minister that the country may have too many ports.

The drawn out and often acrimonious Auckland port dispute has spawned calls for the number of ports to be culled.

John Key’s giving some thought to suggestions we’re overloaded in the unloading business, and he says the Productivity Commissioner is looking at the overall structure.

“In the end the truth of it is if we have too many ports then they won’t be financially viable and some will close,” he told Newstalk ZB’s Mike Hosking.

Mr Key says Ports of Auckland is losing business to Tauranga because Tauranga is more efficient.

And as the editorial notes, the ownership model stops there being a sensible rationalisation, where a 10% cut in transport costs would add $1.5b to the economy.

Hayden Donnell at NZ Herald reports:

Radio Live host Willie Jackson has called for striking wharfies to mount violent “militant action” in their ongoing battle with Ports of Auckland bosses.

Mr Jackson, a former trade union organiser and Alliance Party MP, supported the striking port workers’ calls for eight hour shifts and job security on his Radio Liveafternoon slot today.

He called Ports of Auckland bosses “greedy, filthy, right wing fundamentalists” who were led by a “gutless wonder” mayor.

Intimidation or violence was needed to stop non-union workers being called in to do the striking workers’ jobs, he said.

We first saw some violence on the protest, against counter-protesters. Then there was damage done to at least one car this morning. And now a former MP is advocating there needs to be more violence and intimidation.

Will the CTU and/or the Maritime Union condemn Jackson’s remarks, and say they support peaceful protest only? Or will they implicitly condone them, by remaining silent? For they are the ones who have organised the picket line, so they can’t say it is nothing to do with them.

UPDATE: Jackson now says he only wants the union to be more militant and use greater intimidation, but not use violence, after his earlier remarks were highlighted.

Derek Cheng at NZ Herald reports:

Labour leader David Shearer says he has taken a consistent position on the Ports of Auckland industrial dispute, even though he marched with the workers on Saturday and earlier described the issue as “not about taking sides”.

Perhaps David was marching with the two counter-protesters, if he was not taking sides?

Matt McCarten attacks Len Brown in his HoS column:

Brown’s actions, or lack of them, over the port fiasco are perplexing.

His officials set an impossible 12 per cent return for his port’s directors.

When they ran into trouble I’m told the board offered the mayor their resignations. If true it was a master stroke. Because once he assured them of his support he was their puppet.

No experienced politician who knows what they stand for would have been manoeuvred like this.

With the biggest citizens’ revolt for 60 years about to erupt in his city, he is pathetically reduced to whimpering that he doesn’t have any real power. He looks weak.

The biggest citizens’ revolt for 60 years? Really? 3,000 people turned up to the support rally for the Maritime Union. That’s 0.3% of Auckland’s population.

I defend Len Brown in my Herald column today:

Len Brown campaigned to be the first Mayor of the Auckland super-city with the slogan, that he would be the Mayor for all of Auckland.

Mayor Brown has come under huge pressure from his party, his donors and his activist supporters to abandon his campaign pledge, and to intervene in the Ports of Auckland dispute. It is to his credit that he has resisted putting the interests of the Labour Party above the interests of Auckland.

I conclude:

Len Brown got elected on a slogan of being the Mayor for all of Auckland. The Labour Party shouldn’t complain that he is taking that slogan seriously and putting the interests of Auckland ahead of the interests of the Labour Party affiliated Maritime Union. He should be congratulated for his stance.

In my full column I articulate why I think this has helped Brown get re-elected.

Last night on 3 News they interviewed a couple of staff working at the Port of Tauranga. What a stark difference it was to the Ports of Auckland. They talked of a culture of getting the job done, and even pride about increasing efficiency.  An extract:

Throughout the Auckland dispute, the Port Of Tauranga has been held up as an example of how Auckland could operate – profits are at a record high, and the port seems to have a contented workforce which gets the job done quickly and efficiently.

David Hone has worked at the port for 18 years and, like 90 percent of employees, is a shareholder in the company.

He says “working in a place that you’re part owner [of]” means he’s more invested in the success of the business.

It’s one of the key reasons the port is so successful, according to chief executive Mark Cairns.

“If you have a stake in a company your behaviour changes when you’re an employee,” he says.

I’m a huge fan of employees being shareholders, and POT seem to be a great example of how well this can work. It is such a shame that Mike Lee a few years back deprived POAL employees of this opportunity.

Profits and efficiency do not need to be the enemy of having a happy workforce. It is just when dinosaur unions get in the way, that it does not happen. Look what has happened at POAL since the unionised staff went off the job:

Ports of Auckland chairman Richard Pearson says flexible rosters increase productivity and the 50 non-union workers have proved that.

“We’re operating at a 25 percent production improvement on what we were achieving 3 or 4 weeks ago before the strike,” he says.

“They don’t want to go slow so they can get another shift, they just want to work.”

Imagine the incentive at the moment. If you can delay a ship for another 90 minutes, then you get an extra eight hours pay.

There’s a lot of focus at the moment on the possible expansion of the Port into the harbour more. POAL makes the point that if they can lift labour productivity by a conservative 20% it would give them the equivalent of two new berths, allowing the Port to accommodate five extra ship calls each week.

After weeks and months of strikes, and a growing loss of business to other ports, it was inevitable that Ports of Auckland would go down the only viable path left to them, which is contracting out.

The Herald reports:

Ports of Auckland said the decision to introduce “competitive stevedoring ” was partly the result of the impact of long running industrial action on its business.

Redundancies would begin later next week, with striking staff encouraged to apply for new positions, he said.

“This decision has not been made lightly, but we believe it is vital to ensuring a successful and sustainable future for the Port, including protecting jobs over the long term,” he said.

Ports of Auckland Chairman Richard Pearson said the company’s priority was to win back lost business.

“This decision will reassure the wider market and customers that we plan to achieve a sustainable lift in the port’s competitiveness as soon as possible.

One can’t continue with a situation where you get paid for 43 hours and only actually work 28.

Phil Twyford blogs:

Len Brown was elected the people’s mayor on a wave of support across west and south Auckland. People opted decisively for his plan for public transport, and a modern inclusive vision for the city that embraced the young, the brown and working people.

Which makes it puzzling that he is choosing to stand by and watch while his port subsidiary tries to contract out 300 jobs. …

It is all the more puzzling given the Mayor’s commitment to reducing social inequality, reflected in the excellent Auckland Plan. It is hard to see how we are going to build a more prosperous and inclusive city by stripping the city’s employees of their work rights and job security. …

It is time for Len Brown and his Council to rethink their demand for a 12% return, and replace it with something reasonable and not excessive. He should tell the port company casualisation is not an acceptable approach to employment relations in a port owned by the people of Auckland.

This is the same Phil Twyford who spent years saying that Wellington should not dictate to Auckland, yet is now trying to bully Len Brown into putting the interests of the Labour Party (for the Maritime Union is part of the Labour Party) ahead of the interests of Auckland.

Len knows he would be toast if he kneecapped a Council subsidiary, just to please the Labour caucus in Wellington.

David Shearer says Labour is not taking sides the in Ports of Auckland dispute, but here are two of his MPs on the picket line.

I guess they have no choice as the Maritime Union is actually an affiliate member of the Labour Party, and one of their donors. Not even the documented examples of union hostility to female and non European workers is enough to shake their support of the union.

Watch this video from a non union employee at Ports of Auckland, about how the union employees treat him. Also recall that the Maritime Union is affiliated to the NZ Labour Party, which advocates on their behalf.

Hat Tip: Whale Oil

Hayden Donnell at NZ Herald reports:

Ports of Auckland workers are set to strike for a full week in a new escalation of their long running employment dispute.

The just-announced strike action is set to start at 7am on February 24.

It is in addition to a partial strike set to take place from February 15 to 22.

So basically, they will be on strike for two weeks continuously.

How long until all the customers have gone to Tauranga?

Ports of Auckland have put out a PR around their plans to expand their current space:

In the context of the Auckland Plan process, the Port’s key interest is in protecting the current port zone, which has been through two public submissions processes and has been in place and public since 1987.

The zone effectively allows the option for port expansion in the future, but any actual proposals for expansion of Port operations would then be subject to widespread public consultation and Resource Consent processes.   

While I’m on POAL’s side when it comes to having an economically sane labour market, I’m very much against any expansion on their current site.

POAL say that their zone has been in place since 1987. That is in fact the problem. They were zoned for that area when the waterfront in Auckland was massively different to what it is today.

The same applies in Wellington. In 1987 the waterfront was a collection of sheds.

Waterfront space has become the most valuable space in urban cities. It is where people want to dine, drink, walk and shop.

In Wellington I am an advocate of shifting the port entirely from its current location over to Petone/Seaview. That will provide more jobs in Seaview, and open up the current port space to immense possibilities. Yes, it will cost money to shift – but a shift should be inevitable – when not if. The current port is an eyesore.

The same applies in Auckland. Ports of Auckland should not be relying on a 25 year old zone. They should be looking for a new site away from the centre of the city, as their long-term home. Sure you have issues such as rail and road links, but they can all be planned for also.

If you want to have your say and hopefully oppose Port expansion on its current site, go to Your Port Your Call’s page on Facebook or Twitter.

Ports of Auckland have twice released information on average remuneration levels for wharfies or stevedores employed by them. Many on the left have claimed these figures are wrong on the basis of a column by Matt McCarten which used third hand information from the union.

It has been interesting seeing so many try to deny factual figures, on the basis of just wishing they were different, as they are unhelpful to their cause.

Anyway Ernst & Young have audited the Ports of Auckland figures, and confirmed them. Hopefully this means the deniers will now be quiet. I’ve embedded below the Scribd by Whale.

Ports of Auckland Fact Sheet – Ernst and Young

A summary is:

• Ernst & Young found Ports of Auckland was correct in stating that the average remuneration for full time stevedores was $91,000.
• Not a single full-time stevedore earned as little as the $56,700 described by theMaritime Union as the basic wage at Ports of Auckland.
• Ernst & Young found that even part time stevedores made more than this, earning on average $65,000.
• 43 individuals earned over $100,000 with the highest earner making $122,000.
• Union claims that a stevedore would have to work around 32 weeks of overtime a year to receive the average remuneration of $91,000 are untrue.
• The $91,000 includes a range of allowances, benefits and shift payments with the average number of hours paid per week averaging 43.9.
• However, the real issue is the lack of flexibility which results in an excessive amount of paid downtime at the port. This means that for every 40 hours paid, Ports of Auckland’s stevedores are only working 26.

So Ernst & Young have confirmed that the average remuneration for a wharfie at POAL is $91,000 and the average umber of hours actually worked a week to gain that is 28 (26 x 44/40). That is an average hourly remuneration of $62.50 for actual hours worked.

The Maritime Union have said their strikes and industrial action is because they are against casualisation at Ports of Auckland. Labour have also said this is what they are concerned about.

However Cactus Kate blogs:

The problem with MUNZ’s, Fenton’s and the left’s argument about casualisation is that right now MUNZ is pursuing a case against POAL in the Employment Court to prevent the Port offering permanent jobs to “lashers”.

This is not a joke. They are AGAINST casuals getting permanent jobs.

You may think so, but not when the Union bullies (mainly old, white crusty’s like the charming couple we met yesterday on this blog) have the top jobs and like to take the overtime at their much higher rates rather than allow the lower paid workers to get permanent jobs.

The Herald reports:

Despite the considerable union influence within his party and calls for him to offer support to Maritime Union members, new Labour leader David Shearer has kept quiet on the matter.

Yesterday Labour industrial relations spokeswoman Darien Fenton, who has been spotted on the picket line at the port, said her party was not taking sides in the dispute.

“We’ve been hoping that the parties will settle this, that they’ll find a way through this.”

You’ve been on the picket line, and now you’re saying you’re not taking sides? I think someone has squashed Darien.

Ms Fenton said Mr Shearer had been in regular touch with both sides, “and he’s in contact with me and we’re all discussing it regularly”.

“Our strong view at this point is it’s not helpful for politicians to get involved.”

Apart from being on the picket line?

I suspect that strong view is Mr Shearer’s.

Chris Trotter did an open letter to Shearer yesterday urging him to wade in:

Ultimately, isn’t it about answering the question: “Who is strong enough to stop the stone-throwers?” The men and women who formed the Labour Party in 1916 decided that the answer to that question was the State. If the State could be made to stop working for those who already exercised power, and began instead to work for those who were powerless, then a political party seeking to put an end to poverty, war and injustice would have a fighting chance.

Labour was formed to create a State that wasn’t neutral; a state that never stood on the side-lines when working people were being threatened and abused. Labour was about intervention: constant, massive, intelligent and creative intervention on behalf of the weak and against the strong.

It’s time to bid farewell to the white sands and the Pohutukawa blossoms, Mr Shearer, and come on down to the Auckland wharves. It’s time to cast aside the gathered cloaks of a spurious and culpable “neutrality” and place yourself and your party between the stone-throwers and their victims. It’s time to end the silence.

28 Auckland Council Local Board Members have called on Ports of Auckland to surrender to the demands of the Maritime Union, and rule out any contracting out as that will have few work-life balance protections.

I guess having to work more than 28 hours a week to have remuneration of $91,000 would upset the work-life balance.

The majority of the 28 board members are well known Labour activists. Useful of them to provide a hadny list of whom not to vote for.

Worth  noting that the total number of local board members is 148, so 120 have not signed the Labour Party missive.

Mike Hosking’s editorial:

In a way, you can’t blame the wharfies for putting up the fight they are at the Ports of Auckland. I mean if you were being paid to do nothing, you would be looking to hang on to the deal, wouldn’t you?

Eight hours pay, three hours work – good on them for getting the deal. God only knows who was thick enough to sign it off, but the game’s up. The port is lacklustre. it’s losing business and money to other ports. Its reputation isn’t flash and at long last they’re looking to get things tidied up.

What a good summary.

The wharfies have lost. They don’t have the support of the company, of the council which owns them, they certainly don’t have the support of the Auckland ratepayers who are watching a company they own get destroyed, and they don’t have the support of the wider public. Through all the bluster and hot air and jibes at management pulled directly out of Arthur Scargill’s handbook on how to run a class ridden industrial dispute, they have been seen for what they are – a fiefdom on a deal from another age refusing to be realistic.

Even Len Brown doesn’t back them. The man who took their money to get elelcted sees it for what it is. He should have been playing a far greater role before it ever got to the state it’s in. Ports of Auckland is a major company with a major contribution to the economy of the biggest city in the country and it’s operating in a time warp. Business is leaving – Maersk has walked, Fonterra’s gone.

This even goes beyond Auckland. Reducing freight costs through more efficient ports and the like has benefits for all of New Zealand, especially exporters.

Where’s the council? The owners? The representatives of all the rate payers who have a stake in the business? The dividends are a joke compared to Tauranga. Do they think the port is a welfare scheme? A jobs programme? Why aren’t they demanding better performance and better returns? The answer is there – lay them off. Too many strikes, too many lock outs, too much disruption. Get rid of them and find some people that actually want to do the job.

We must thank Mike Lee for buying out the minority private sector answers, so ratepayers would be the only ones having to tolerate a return of just 2% on capital.

Brian Gaynor provides some excellent analysis:

One of POA’s biggest issues is its wage bill of $54.9 million compared with POT’s total employee expenses of $25.3 million, even though the latter is now the larger port.

Port of Tauranga was miniscule when it listed 20 years ago, but today has higher revenue, earnings and dividends than POA.

POT is an excellent model for the proposed partial sale of the Crown-owned electricity generators and Solid Energy.

The port company had a 10 per cent ownership restriction, a strong board and management and has performed exceptionally well as a listed company under the public/private ownership model.

In 2002, the company had a capital return of $7 per cancelled share on the basis of one share for every eight shares held, and the following year it had a two-for-one share split. Thus an investor who bought 1000 shares for $1050 in the IPO has had $875 of capital returned, and the remaining 1750 shares are now worth $17,850 at $10.20 a share. These figures do not take into account total dividends of more than $370 million over the two decades.

In other words, POT’s sharemarket value has surged from $80 million to $1368 million over this 20-year period and the Bay of Plenty Regional Council, which still owns 55 per cent, has been a major beneficiary of this.

Stunning results. And the key thing to note is a mixed ownership model can result in the public’s stake being worth more at (say) 55% than if they had retained 100% ownership.

As the accompanying figures show, POA has been hammered by POT in recent years: POA’s ebitda has fallen from $92.6 million in 2003 to $74.4 million, whereas POT’s has increased from $69.5 million to $95.0 million; POA’s ebitda margin has fallen from 55.3 per cent to 40.5 per cent while POT’s has increased from 47.6 per cent to 51.2 per cent; most importantly, POA’s dividend has declined from $34.5 million to $17.6 million while POT’s has increased from $22.8 million to $40.2 million.

This is a huge concern to Auckland ratepayers as the $17.8 million POA dividend represents a return of only 2.1 per cent on POA’s $848 million 2005 takeover value.

Mike Lee should be held accountable for this.

In 2010, POA had total employee expenses of $51.9 million compared with only $18.5 million at POT and last year employee benefits plus pension costs were $54.9 million at POA compared with POT’s $25.3 million.

This is what happens when people get paid for 43 hours, despite only working 28 hours. I am presuming the POT costs included contracted labour.

Lee made the ridiculous statement that POA and POT should act in an anti-competitive way by working together to get better rates from shipping companies. He went on to say that the shipping cartel Maersk and Fonterra “have kept prices right down by playing Tauranga off with Auckland” – yet Lee was primarily responsible for stopping merger talks between POA and POT.

We want competition between ports. That drives efficiency and productivity gains.