All throughout the news at the moment, is the ongoing drama going on at Mechanics Bay where the MUNZ (Maritime Union of New Zealand) workers are striking against the Ports of Auckland. The strike has been going on since last month and is taking a toll on the Auckland economy. Fonterra and Maersk have already decided to stop using POAL (Ports of Auckland, Ltd) and move goods through the ports in Tauranga and Napier.
Now, it's not that the dockers are making very little money, with $91000 per annum an enviable salary, along with flexible working conditions. Their outrage is actually from the fact that four contract workers have been discovered working at POAL, despite the unionized workers outnumbering them 80 to 1. The union wants to have a monopoly on the supply of labor to POAL, and have refused a 10% pay increase to stick to that idea. Even my mother said they were fools to reject that kind of pay increase, at a time when no one else in the economy is seeing anything like that.
Back and Forth
Over the last few weeks, POAL and MUNZ have issued press releases and statements publicly to try and sway people to one side or the other. Most people are backing POAL and think of them as rather generous, or are generally pissed off that the port is closed; while die hard lefties are sticking to their union comrades to the bitter end despite the cost and the embarrassment. Cr Chris Fletcher of Auckland Council has also issued her own statement on behalf of the council, voicing their concern over the dividends the port was paying to the council, and the effect the port closure is having on Auckland.
POAL is currently 100% owned by Auckland Council. The funny thing about where the allegiances lie for Auckland Council, is that mayor Len Brown is a leftie, and the reason that the council isn't taking charge of the situation and looking after their own asset, is because Brown must be torn over what to do about the port, and the workers. As much as he can support the striking workers, his job as mayor is a commitment to the people of Auckland and the council, and he must take things from POAL's perspective.
Privatization - The Solution To So Many Problems!
Len Brown, like his right-wing mayoralty adversary, Hon John Banks, supports the construction of the Auckland city rail link, an expensive rail connection from Britomart Transport Center in the city center and the Westbound railway line. Most Aucklanders support the project inherently, but the question is always how to pay the billion dollar price tag. If Len were smart, the Council could find the capital by following the National Party policy of mixed-ownership of public assets, by selling up to 49% of POAL out to the market.
This is a fantastic asset to buy shares into, being a local company that is highly successful and necessary to the economy. It is an Auckland landmark, a local employer, has great expansion plans, and should be worth a great deal. The council will lose 49% of the $3million dividends it receives from the port, but won't have to try and save up for the project itself. The Port of Tauranga Ltd is listed on the NZX50 and is among the 50 biggest companies in the country. The land value of the Mechanics Bay port alone is $235 000 000, and the total value of the site is $348 000 000. There is serious money in this asset. Applying the mixed model of ownership (MMO) to POAL could free up a great deal of capital, in which the council promises to invest the money in local public projects, such as the city rail link.
As for the strike, a barrage of angry investors would be better at taking charge of the port situation than a confused Auckland Council. A stinging article in the Herald by Damien Grant says that
"Gibson [CEO of POAL] should sack the entire workforce and start again. At $91,000, there will be no shortage of applicants, even if he has to fly them in. He will not because his political masters will not let him."
True that. Of course, the issue is that CEO Tony Gibson is doing the best he can in this situation, his hands are tied by Auckland Council, who really needs to step up and own this problem. They are supposed to own the port on behalf of Auckland and its ratepayers. Without finding a satisfactory solution to the problem, the council is allowing this drama to carry on and let the Auckland economy get kicked in the nuts. Hundreds of thousands of jobs, millions of dollars of business, and the livelihood of Aucklanders depend on the port; and the Council is doing a disservice to its city by prolonging this drama.