Week in Review

Why port move ‘debate’ is a pointless farce

Anyone watching the news coverage of the debate over the future of the port of Auckland would think a move to Northland is a real prospect. It's not, writes Bernard Hickey, who sees it purely as a political oxygen machine for New Zealand First.

Labour and New Zealand First remain divided on the future of the port of Auckland after a cabinet debate this week that is increasingly looking more like a charade for the purposes of New Zealand First's need for electoral oxygen than anything with a real prospect of happening any time soon.

Prime Minister Jacinda Ardern told her post-Cabinet news conference the port of Auckland was "unsustainable in the long-term as the country's main import port," but that is a statement most agree with and that includes a range of outcomes, including keeping the current Port for a decade or more. It could also allow a new port at the Manukau Heads or the Firth of Thames, rather than New Zealand First's choice of Northland.

She was talking after Cabinet decided to release the final results of its ports study on Thursday.

Has everyone lost their minds?

In my view, this is all a charade, particularly given the way Jones has used the debate to raise his profile with attacks on the Ports of Auckland CEO Tony Gibson and to dismiss the sovereignty of Auckland Council over its asset and land.

The way the debate has been reported in recent weeks is mind-boggling. Many seem to think the decision is like any other about a new piece of infrastructure on virgin land where the Government in Wellington is the sole decider (and is united) and a decision can be made before the election.

Nothing could be further from the truth.

Firstly, the Ports of Auckland company owns the operation and has its own board separate from the Council. Secondly, the land is owned by the Auckland Council, which is itself a political body requiring consensus for such a big series of decisions. Unlike the Government in Wellington, which is relatively coherent with a single Cabinet deciding issues and a Parliament able to enact its decisions virtually on demand, the Council is free floating collection of councillors and a mayor who can be (and is often) over-ruled by a majority of councillors.

Then there are the enviro-legal and financial issues. Changing the land use of the port and surrounding areas would require multiple Resource Management Act processes that could take decades and potentially fresh Acts of Parliament, let alone a coherent and united effort by councillors, the mayor(s) and multiple Council-Controlled Organisations. Then there's the financial costs and tradeoffs involving multiple governments, the ratings agencies, Treasury and the financial markets.

The current port study process suggested a total cost of $10 billion to move the port, but a closer look suggests the numbers could be far higher. Two major new railway lines would have to be built, the Council would have to be compensated for the forced acquisition of the land, the port would have to be de-constructed and over a century's worth of infrastructure reconstructed.

Has anyone asked businesses?

Then an entire transport and logistics ecosystem would have to be broken up and reformed, often involving third parties, who would also want compensation. That includes various inland ports, warehousing operations, container storage and leasing operations, and entire service sectors such as freight forwarding, customs and all the financial services around that.

This entire 'debate' is all for appearances' sake for New Zealand First. A study on moving the port to Northland was an election promise and was included in the coalition agreement with Labour. But it was only ever a gesture, which New Zealand First now wants to turn into the appearance of a real thing it can run on at the 2020 election.

But even then, New Zealand First itself realises that an actual decision may not happen for a decade or two, with Jones saying yesterday the timing could stretch across three dates: 2029, 2034, or 2050. The current political balance of power would have to remain unchanged in both Wellington and Auckland.

And where's the political consensus?

And no one has considered how the Greens would vote on such an issue, given the move would increase carbon emissions by up to 212,000 tonnes per year. The business community would also have to support the move, along with the consumers who would see their import costs rise by over $1 billion a year.

Finally, such a project being done over such a long time and with so many moving parts would realistically need bipartisan support, which it does not have.

Everyone should take a chill pill and understand this is a an exercise in buying political oxygen for New Zealand First.

Get it early – This article was first published on Newsroom Pro and/or included in Bernard Hickey’s ‘8 Things’ morning email of the latest in-depth business and political analysis. Get it early by subscribing now or starting a 28-day free trial.

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