Keith Speech Ports and Shipping Conference

The Green Party looks at this topic, ports and shipping, as it does all others, in an integrated way — in terms of how it affects our quality of life and that of future generations.

What we try to do is to get people to look beyond narrowly defined economic efficiency and take into account all the environmental and social effects of what we do.

It is good to see that around the world companies are starting to look at their performance in broader terms. Sometimes this is called triple bottom line reporting — that is reporting on economic, social and environmental consequences.

Ports and shipping issues are difficult for New Zealand because we are such a small country, under huge pressure from giant international shipping companies, and it requires some determination to advance the interests of our people, our economy and our environment.

New Zealand doesn’t operate on a level playing field, and New Zealand shipping companies have found it difficult to survive against the big international players.

Shipping Industry — short-term future

The domestic shipping industry in New Zealand has stabilised at a low level after a period of decline that spanned several decades. However, shipping still carries a reasonable volume of domestic freight.

Factors affecting the decline in coastal shipping include

•Competition from a more complete rail network in the 60s and 70s

•Transport deregulation in the 80s, leading to increased competition from road

•The opening up of the coastal trade to foreign vessels in 1994

•The removal of a large amount of diesel tax in the late 1990s, giving a new cost advantage to road transport

The Green Party is committed to ecologically sane policies that strengthen local economies and local communities. We agree with the December 2000 report of the government’s Shipping Review that New Zealand needs a sustainable domestic shipping industry that is both competitive and uses best practice.

If this is accepted then we have considerable sympathy for the need to look at measures such as cabotage and a “tonnage tax” as proposed in the Shipping Review. The “tonnage tax” is actually a tax concession, and we do have a degree of caution about such things.

We believe that strong local shipping industry is part of creating the infrastructure for a more self-reliant and ecologically sustainable nation. Given that the international shipping market is described by the Shipping Review as operating in a virtually zero-tax environment, we are willing to look closely at proposals for a tonnage tax.

I was interested to see that it is the tax regime rather than the labour and safety standards for ships that are seen as the main issue. The conditions of employment of crews on international vessels remains a concern and the Greens believe that workers in New Zealand waters ought to receive the same protection irrespective of the flag their ship operates under. We would hardly tolerate a land-based employer setting up a sweatshop and justifying it on the basis that the company was owned offshore!

The Green Party fully supports the efforts of unions and the International Transport Federation to maintain labour standards, and to prevent dodges such as flags of convenience being used to employ seafarers at rock bottom wages and conditions.

As Greens, we also have a responsibility to our own citizens and our own seafarers. It is important that we have New Zealand seafarers on as many ships as possible. I have heard recently that the P and O line will be moving away from Australian and New Zealand crews on its Trans-Tasman boats — perhaps replacing them with Filipino crews. This is something we should oppose.

I have been on the Foreign Affairs, Defence and Trade Select Committee discussing our CER agreement with Australia and one point I have made is that CER should cover workers’ interests as well as investors’ interests. We would support a move under CER to consider trips between Australian ports, between New Zealand ports and between Australian and New Zealand ports as a single market, and to facilitate an Australian and New Zealand work force on boats dedicated to this trade. We reject any idea that the shipping industry has to exclude Australian and New Zealand workers to improve its efficiency. We can’t be proud New Zealanders if we treat our fellow New Zealanders in that way.

We must also take the same community attitude to wharf workers in New Zealand, working cooperatively with major unions to protect the interests of their members. That means not repeating the Mainland experience, where North Island workers were sent in to undercut jobs and conditions of locals in the South Island. It also means seeking to have the maximum number of full-time waterfront workers, not the minimum. If you are looking at broader community interests, large-scale casualisation is not the way to go.

Another challenge is how to stop the big shipping companies disrupting the viability and stability of our ports by shifting huge volumes from one port to another in an effort to get the lowest rates. To deal with this problem we should consider all of the ways ports can cooperate as well as compete, and how the government might be able to assist. The Greens are very community focussed and believe we should think as a nation, sometimes called New Zealand Inc., when confronted with such problems.

We must work together so that our shipping, ports and land transport work together to create strong local, regional and national economies.

Sometimes, when you’re in the business of transport there could be a temptation to consider all trade, and the transport associated with it, as good. But transport is also a cost to the community, and that should be taken into account when considering where production should be located and how much economic self-reliance should be promoted. With this in mind, the Greens promote “buy New Zealand” and “buy local” campaigns and favours local procurement by government agencies and local bodies.

Economic development can and should proceed without a concomitant growth in the distance people and goods are moved. Energy use is a marker of sustainability — and New Zealand does relatively poorly on a per capita basis by this measure. Mostly this is because we are shuffling people and goods more than ever before.

This is all being done on borrowed time — and I will have more to say about that later.

The good news is that within this view the Green Party sees a much greater future role for the energy efficient modes of transport, coastal shipping and rail.

Energy use, climate change, and freight shares

Coastal shipping is the most energy efficient means of freight transport. In the Energy Efficiency and Conservation Authority report (2000) we see that road transport uses 3.1 MJ/tonne-kilometre of energy, rail uses 0.61 MJ/tonne-kilometre and coastal shipping 0.38 MJ/tonne-kilometre.

Coastal shipping carries around 25% of total domestic freight as measured by tonne-kilometres but uses only 5% of the total energy used by this sector.

Freight energy intensity overall has risen by 10% since 1975 despite falling energy intensity in each mode; this is because road, the least efficient mode, has an increasing share of freight.

In 1975 road transport and coastal shipping carried about 40% of the total freight each and rail about 20%. However, by 1998 road transport had increased its total to 60%, coastal shipping slipped to just under 24% and rail to under 13%.

If freight shares had stayed the same as in 1975, freight energy use in 1998 would have been 30% lower than it actually was. That means less CO2 emissions, less local air pollution and better environmental health.

The increasing share of road freight in domestic freight has meant higher energy use and CO2 emissions, plus more local environmental problems including noise, accidents and the destruction of communities to serve the insatiable demands of the roads lobby for more motorways.

Over the last couple of days, there has been a debate over the Eastern Highway, which goes from the Port of Auckland out to the Eastern Suburbs. If you were just looking simplistically at how to get containers out of the port by road this might be a good idea, but the motorway would be a disaster for the broader community — adding thousands of cars to the congestion in central Auckland for a start.

The big problem with rail freight playing its proper part is that it is not playing on a level playing field with road transport. As Michael Beard from Tranzrail will no doubt tell you later, his company has to pay all the infrastructural costs, as well as freight transport and handling costs, whereas road users don’t cover all the infrastructural costs of road construction and maintenance, or the extra community costs of air pollution, noise, inconvenience to other road users, greater use of fossil fuels, etc., etc..

This is part of the reason why our rail network is being run down, which is not to let Tranzrail off the hook entirely. I heard yesterday that the North Island main trunk has 120 minutes of speed restrictions on it — which means that track problems are adding two hours to freight transport time, which is hardly helping rail in the competition with road. And it is why the government should put money into rail. We support the rail union’s “Take Back the Track” campaign, whereby the rail tracks are taken over by the government and developed into a proper infrastructure facility — that can, among other things, provide the most efficient way of transporting goods to ports.

I am not an expert in the technicalities of hubbing and the functioning of inland ports. But I do see that using rail transport to any hubs, or from any inland ports, is crucial for energy efficiency and the well being of our country. I do worry that Tranzrail seems to be moving away from competing fully with road transport in the movement in the transport of the range of cargoes — for example, for not investing in enough log carriers (a crucial area with so much timber about to come on stream).

The most efficient energy use, and the least use of fossil fuels, is where we Greens are coming from.

Looking to the future in a climate constrained world

On our analysis long-haul road freight is too dominant. We do not wish to see the end of road freight and it certainly plays its role. But we are clear that for safety, environmental, and economic reasons more freight needs to be carried by rail and coastal shipping than is the case at present.

Such a shift is particularly important if we are looking to future proof our transport system against global efforts to combat climate change. Most of the greenhouse gas increases in New Zealand since 1990 have come from the transport sector.

Domestically a precautionary approach to climate change demands a stronger commitment to coastal shipping in government policy.

There will come a time when international freight will need to play its part in reducing greenhouse gas emissions.

The expansion of global trade has effectively been at the expense of the global climate. Fossil fuel powered ships and planes have borrowed from the future — a future which is starting to demand payment. New Zealand cannot isolate itself from a problem and a solution that must be truly global.

Climate change is real and measures to tackle it are being developed. There are respected analysts within the oil industry who suggest that global oil production is peaking. These factors point to a radically different global environment in 50 years. The era of fossil fuels is coming to a close.

This is a long-term challenge for a nation that sees itself as dependent on exports carried vast distances by cheap fossil fuels.

Technologies that seem fanciful at present, such as wind and solar powered ships, may become commonplace in a climate constrained world. Trade is likely to be more focussed on higher-value specialist products. The volume of global trade will stabilise, while the energy used to move it will fall.

Localisation and investment in alternative technologies are part of the Green approach but we all need to start thinking long-term. Our future is at stake.


There are major issues with shipping and biosecurity.

Ballast water from international ships has been a major source of biosecurity threats in the past. This remains a constant threat, because it may only take one act of carelessness or negligence to introduce a major new pest species.

Imported vehicles and vehicle parts, and containers generally have been a major potential risk pathway. Only a minority of containers are inspected.

The Green Party does not believe that potential delays to imports are a reason to limit inspection of inbound cargo. We just have to throw more resources at inspecting the containers. The present level of protection still does not reflect the potential costs of pest incursion. You just need to look at how much is being spent on the painted apple moth eradication at the moment.

Biosecurity is a hidden cost of so-called “free” trade and we will continue to push for a higher level of biosecurity protection, fully cost recovered from importers.

Transport Strategy

Much of the analysis of the Government’s transport policy announcements in February focussed on land transport. However, the strategy being worked on by the Government and the Greens covers all modes.

The emphasis on regional development, environmental sustainability, public health and a range of broader goals than simply short-term economic efficiency bodes well for the shipping industry.

There is not time here to dwell on this in detail but I would encourage this conference to start looking at a new role for shipping as well as rail in providing alternatives to roading. Barging of logs, for example, has been touted as one alternative to roading and may indeed be a good option in some parts of the country, where access by other modes is difficult.

With greater private sector involvement in ports, it is probably time to look again at the status of port companies as “requiring authorities” under the Resource Management Act. Such requiring authorities are able to designate land and, if people do not sell willingly, access the Public Works Act. We are very uncomfortable with the power to access compulsory acquisition powers falling to the private sector and have already raised this issue in relation to public-private partnerships in the roading area.

Concluding remarks

Green commitment to local economic development and proactive action on climate change means we support strong domestic shipping industry and viable ports.

The ports and the shipping industry need to ensure they take environmental responsibility seriously.

Any moves towards reflecting the full costs of transport in prices can only help coastal shipping and rail. We strongly support an enhanced role for both.