Sunday, June 16, 2024

New Auckland Mayor floats port plan

Incoming Auckland Mayor, Wayne Brown, has written to the chairperson of Ports of Auckland Ltd (POAL), Jan Dawson, to share his expectations for the 100% Auckland Council-owned company.

The Mayor acknowledged the commitment of Ms Dawson and her board to lift the performance of POAL in line with its Statement of Corporate Intent.

But he said Aucklanders had told him they expect the new Council to act more decisively on the future of the port.

“There is no one who voted for me who should have been unaware of my view that car importation and container services should cease at the current site,” Mayor Brown said.

“My letter sets out several immediate priorities based on my election promises, the views of Aucklanders expressed at more than 300 campaign events, my discussions with members of the new governing body and Independent Māori Statutory Board over the last ten days, and my statutory role to provide leadership towards a vision for Auckland.”

The Mayor said the priorities in the letter were central to that vision and he would work with central government where necessary to remove any legal or regulatory barriers to change.

In the short-term, Mayor Brown has asked POAL to take immediate steps to achieve a more efficient use of port land and make more of it available for the public.

He has asked it to work with mana whenua Ngāti Whātua Orakei and other stakeholders including business and community groups, supported by his office and council officers, on a plan and timeline to develop the area from the Ferry Building to Bledisloe Wharf into an area that can be enjoyed by all Aucklanders, with better access to the harbour including a view-shaft to the sea.

Bledisloe Wharf is currently used for the importation of used cars.

The new Mayor also wants POAL to move as quickly as possible to a 100% rail solution to reduce congestion and lower carbon emissions.

He has asked for POAL and Ngāti Whātua Orakei, in its role as mana whenua, to agree and report to him on a plan towards these objectives by 31 March 2023.

He has also asked for monthly reports on POAL’s progress to improve its previously “appalling safety record” and on its ongoing industrial relations as a good employer.

Looking further ahead, Mr Brown has asked for POAL’s advice on “rigorous additional benchmarks for return on capital based on valuing the port land at its highest and best use”. Currently POAL reports quarterly on its productivity compared only to other comparable New Zealand ports.

Mayor Brown wants to incentivise POAL to utilise its land better and return it for the enjoyment of the people of Auckland where possible. He says he’s not interested in any arrangement involving a long-term lease which would lock the port into its current footprint for decades.

While wanting the land on which POAL operates to be put to better use, Mr Brown has reconfirmed that the land “belongs to the people of Auckland, should always belong to the people of Auckland and must never be sold”.

Mr Brown plans to raise the future of POAL when he meets with Prime Minister, Jacinda Ardern on Thursday.

The full text of Mr Brown’s letter is as follows:

Dear Jan

As I am sure you are aware, Ports of Auckland Limited (POAL) has not been serving Aucklanders well.

It has not operated as a successful business in recent years. Its financial return to ratepayers has been paltry given the value of the council’s capital investment. Its workers have tragically died on the job. It recently wasted hundreds of millions of dollars on a botched automation project. It has stubbornly refused to make better use of the large tract of prime waterfront space it occupies to the exclusion of Aucklanders. It is a major source of congestion and road maintenance costs in the Auckland CBD and wider region. It prevents Aucklanders from fully enjoying the Waitematā harbour.

I acknowledge your commitment, and that of your board, to lifting the performance of the company. I thank you for the work you have undertaken so far, in line with your Statement of Corporate Intent.

Nevertheless, Aucklanders across the region told me that they expect the council to act more decisively to turn around the port and to stop the prevarication on its future. I was elected Mayor with a clear mandate to do that. There is no one who voted for me who should have been unaware of my view that car importation and container services should cease at the current site. In the coming months, I will write to you with support of the council to formally set out our expectations on changes to your Statement of Corporate Intent in line with the Port Companies Act 1988.

In the meantime, this letter sets out several immediate priorities. They are based on my election promises, the views of Aucklanders expressed at more than 300 campaign events, and my discussions with members of the new governing body and Independent Māori Statutory Board over the last ten days.

The letter should be read in the context of my statutory role to provide leadership towards a vision for Auckland and these priorities are central to that vision. I will also be working with central government where necessary to remove any legal or regulatory barriers to change.

I expect POAL to be working with, and not against, me and the council in these efforts.

Medium-Term Strategy: Benchmarking

Aucklanders expect the council and its port company to be working together on a medium-term strategy for a change of the use of port land. Your Statement of Corporate Intent indicates a willingness to do this, and I intend for the council to take you up on that without delay.

While a passenger terminal in the CBD and berth for coastal shipping will always be needed, our strategy must involve a plan for your car importation and container operations to vacate their current location on a fixed date in the future. I need to be clear: the port land belongs to the people of Auckland and should always belong to the people of Auckland. It must never be sold. But the land can be put to better use.

I will be considering how the council can incentivise the port to utilise its land better and return it for the enjoyment of the people of Auckland where possible. However, I am not interested in any arrangement involving a long-term lease which would lock the port into its current footprint for decades. Any other ideas you have on the medium-term transition of the use of the land is welcome.

Currently, you report quarterly on your productivity compared to other comparable New Zealand ports. This should continue. However, I intend to provide clearer guidance on the expectations around improved performance and management of these important assets in the future. This will include rigorous additional benchmarks for return on capital based on valuing the port land at its highest and best use. Any suggestions you have on such benchmarks are welcome.

Short-Term Strategy: Reduction of Footprint

In the short-term, Aucklanders and I expect immediate steps to be taken to achieve a more efficient use of port land and, in doing so, make some of its space available for the public. As part of your plans to improve land utilisation, I expect you to look immediately at plans to do the following:

  • Cease port operations on Bledisloe Wharf, currently being used for the importation of used cars and move it to higher and best use for the benefit of Aucklanders.
  • Working with mana whenua Ngāti Whātua Orakei and other stakeholders including business and community groups, supported by my office and Council officers, develop a plan and timeline to develop the area from the Ferry Building to Bledisloe Wharf into an area that can be enjoyed by all Aucklanders, with better access to the harbour including a view-shaft to the sea.
  • Move container freight from trucks to a 100% rail solution as quickly as possible to reduce congestion and lower carbon emissions.

I would like this work to begin this year and for you and Ngāti Whātua Orakei, in its role as mana whenua, to agree and report to me on a plan based on the three points above by 31 March 2023.

If there are any financial or legal arrangements that would stop your plan from being executed, then I invite you to clearly set out the current barriers so that they can be raised with central government.

Health & Safety

The port’s appalling safety record is a stain on Auckland. I acknowledge your assurance that you have implemented the recommendations of the CHASNZ Independent Health & Safety Report, which found significant improvements were required even after many years of failure. You will need to ensure that is the case, as well as focus on delivering continuous, ongoing improvements in health, safety and wellbeing. There will continue to be a very high level of scrutiny on this aspect of your business.

I would appreciate monthly reports on progress, and on your ongoing industrial relations as a good employer.

I look forward to discussing these priorities with you.

Yours sincerely                                                  
Wayne Brown                                                                                     
Mayor of Auckland

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