ARC Group success underscores why Auckland’s publicly owned Port must not be privatised
The ARC Group (ARC, ARH and ARTA) has had an extremely successful period chalking up major strategic achievements. On top of the political successes of the ARC in recent months eg Queens Wharf solution and the string of important victories in the Environment Court, more recently both ARTA and ARH have reported major strategic successes.
This month ARTA reported that the elusive 60 million public transport trips per year barrier had been passed following a record 60.8 million trips from August 2009 to July 2010 – the highest 12 month patronage figure since 1974.
These results follow on from ARTA’s strong end-of-year patronage figures reported last month. Total patronage for the last 12 months to July 2010 is 60,802,730 – higher public transport usage than the carless days of 1979/80. The record number of Public transport trips consist of 47,711,026 total boardings on buses; 4,537,324 ferry trips and 8,554,380 rail journeys over the last 12 months. Rail has seen an increase of 11.55% compared with the 12 months to July 2009. The Northern Express bus service stands out as having one of the most dramatic increases in usage, with patronage for the last 12 months hitting 1.8 million, an increase of 20.1% compared with the 12 months to July 2009. Patronage for July 2010 alone was 162,493. Our congratulations go to ARTA chair Rabin Rabindran and the Board and managment of ARTA.
Meanwhile on the other side of the ARC Group, Ports of Auckland has recorded one of its very best years with a 55% increase in normalised after-tax profit of $24.4m in the financial year 30 June 2010. However taking into account various one-off factors, the port company’s net after-tax profit rose year-on-year from $5.4m to $37.2 million. Credit must be given to the Ports Board but also to the leadership of Cr Judith Bassett and the board of Auckland Regional Holdings, two members of which (Peter Hubscher and Emmett Hobbs) sit as directors on the Ports’ seven member board. ARH has appointed all the current board members and have been actively involved in formulating the Ports financial restructuring in recent years.
While giving out credit we should never forget that these achievements (public transport patronage or Ports profits) could not have been attained without the people who work at the coal face of these industries – the members of the Rail and Maritime Transport Union, Tramways Union, NDU (transport) and Maritime Union (ferry crews) and Maritime Local 13 (watersiders).
The sharp increase in Ports of Aucklands’ profit gives the lie to the Business Round Table’s so-called ‘think tank’ reports that argue that Ports of Auckland needs to be privatised to be efficient.
Most people can see through this self-serving garbage but its important that Aucklanders understand and appreciate how the profits from the Ports of Auckland have been re-invested in badly needed infrastructure – especially public transport. A classic example would be ARTA’s whole upgraded passenger train fleet was purchased from funding from Auckland Regional Holdings – with most of this money came from Port profits. It would be inconceivable to even contemplate the massive upgrade of our public transport infrastructure that has been achieved in recent years – without the profits from the Port.
The Ports of Auckland remains in public ownership because back in 1992 at my second meeting as a newly elected member of the ARC, (Member for Auckland Central) , amidst a public uproar against asset sales, I co-sponsored the notice of motion with the late Bruce Jesson which stopped the ARC privatising the shares of the Ports of Auckland (see details of this episode elsewhere on this site in Strangers in the 21st Century).
Since that time Ports of Auckland have paid nearly a billion dollars in dividends to the region. Dividends which would have gone to a private, probably offshore owner had we not stopped the sale back in 1992. The region used this income stream first of all to repay debt, and then in more recent years to invest in stormwater and especially transport infrastructure. In 2005 with active support of the ARC, our subsidiary Auckland Regional Holdings bought back the 20% of shares that had been sold by the Waikato Regional Council back in 1993. Ports of Auckland since that time has been 100% owned by the people of the Auckland region. This also enabled the region to gain complete control of the valuable Wynyard Point (‘Tank Farm’) land to enable ARH’s ambitious urban renewal project – now underway. But the Port and its profits have long been a goal for the privatisers – and as the recent Business Round Table report reminds us – they are still out there. Aucklanders should therefore be very wary of political candidates who talk down the value of our publicly-owned Ports of Auckland and who are deliberately dismissive of the enormous amount of money which has been paid out in dividends for the people of the region.
New Zealand is an island nation and Auckland is, and always has been, a city based on the international maritime trade. Auckland is not only a harbour city – its also port city. Ports of Auckland is the biggest container port in the country situated at the front door of New Zealand. An internationalcontainer port at the front door of our CBD gives us an enormous competitive edge. Not just from containers as in recent years cruise ship tourism has assumed major economic importance to Auckland’s economy. Auckland needs the income stream the Ports of Auckland brings. We all need to be aware of what lies behind the superficial chatter which talks down the value of our Port. Because behind that lies the ever-present menace of privatisation.
Given the ARC group is performing so well it’s a great pity that such a well performing organisation is very soon to be dismantled and subsumed into the new Auckland Council and its unelected CCOs.