The Politicians Pension Extension Report, also known as The Upper North Island Supply Chain Strategy by Chris Carr

  • 18 Dec 2019

The Politicians Pension Extension Report, also known as The Upper North Island Supply Chain Strategy.

I generally refrain from political commentary, but this report sludges below the bottom of the political barrel (although NZ First now has another budding mess up which may eclipse this one).

Not since Rob Muldoon’s days have we seen such naked self-interest, and obvious re-election strategies aimed at people who believe the moon is made of cheese (not unusual I suppose given the remnant in parliament from those Muldoon days).

As a Road Transport Operator, you would expect that the resulting business that would come out of such a move would make me an ardent supporter.

Far from it.

It is nuts.

When the discussion about moving car imports to NorthPort first came about I sat down and worked out the implications to us, and to the industry at large.

The result was such a significant increase in traffic on a shitty road north that it was impossible for any sane and logical New Zealander to support it under any circumstances.

If you were to drive north from Auckland, and day, any time, you would have a truck 2 minutes in front of you, another two minutes behind you, and you would pass one travelling in the opposite direction every two minutes.

This would be an impost of gigantic proportions on our fellow kiwis, and one which would be commercially and politically irresponsible.

To that traffic, this report proposes adding another 2000 container moves per day.

That equates to somewhere between 700 and 1000 trucks return per day (because it would be many years before rail could get anywhere near to capacity, see below).

Not to care about the obvious downsides, NZ First and Labour, as part of their coalition agreement agreed to produce a report which would justify NZ First’s position as leading vote grabber for Northland, and thus keep the party in the trough.

The outcome of the report was predetermined at the time of the coalition agreement.

I’m not surprised that Auckland Council and Ports of Auckland are against the proposal. The suggestions in the report take a different view when viewed against logic rather than re-election.

Anyone in the freight and logistics industry knows that distance is the enemy of logistics, and the further you move something the more it costs.

New Zealanders complain about the cost of things now, and yet some politicians feel justified in proposing a move which will increase costs for ALL New Zealanders, forever.

The argument will be that the value of the land will compensate, but doesn’t say who will receive compensation. The family living in Otara won’t see a bean. However, EVERYONE in New Zealand will receive increased costs FOREVER.

In this case FOREVER is much, much, much longer than an election cycle, or the lifespan of any politician. Think your grandchildren’s grandchildren, and keep going.

From this we expect some self-interested groups to attach themselves to NZ First’ coattails, and sell themselves onto the altar of self-interest. Who will be first up? The hypocrisy will be staggering.

What we have not seen is some obvious beneficiaries supporting the proposal:

Port of Tauranga has made a reluctant comment and in vague generic terms only.

You would expect them to be shouting from the rooftops.

They stand to benefit immensely, but they are effectively silent.

Port of Tauranga owns a big chunk of NorthPort (50%).

Port of Tauranga also delivers, at their cost, about 300,000 teu into Auckland every year. They pay this freight cost to compete with ports of Auckland and to provide containers directly into the logistics centre of Auckland. If the cargo was moved to NorthPort they would no longer have to compete, and this money would go on to their bottom line, while the costs would go directly on to Auckland and New Zealand business, adding about 50% to the land costs to an Auckland container delivery.

That they are saying nothing says much more about the ethics and intelligence of those in Salisbury Avenue than it does about a pensioner from Herne Bay.

Kiwi Rail has similarly been very quiet about this. While they are constrained as a government-owned enterprise, they fully understand the difficulties such a burdensome task would be. Despite their best efforts (and I might add those of the Road Transport Forum, the Auckland Business Forum, and National Road Carriers in supporting them) they have been unable to build a vital (but short) 3rd mainline in Auckland due to lack of government support for twenty years. The task of building a viable, double-tracked, line to NorthPort over hundreds of bridges, and more than a dozen tunnels is immensely difficult and expensive.

The other curious thing to me is how a reputable and respected outfit like EY (Ernst Young) came, two years ago, to find NorthPort was the 12th favoured option for alternative ports, and now two years later rate it Number one, with no viable alternatives. The same people did the report. What happened in 24 months that no one else knows about?

The question is which group will ask for their money back? One of the reports is obviously so far wrong that a refund is due.

There is a lot of water to flow under the wharf on this topic, with the only certainty that we (that means you, me and all the other kiwis) will be paying for it.

Next year’s election may hinge on this.

Chris Carr

Carr & Haslam Limited