Confidential Report highlights costs outweigh benefits

 

Radio New Zealand reported today (that a recently confidential report Mayor Phil Goff tried to have blocked from being released (the Ombudsman ordered its release subsequently)) showed that moving the car trade arm of Port of Auckland’s Waitemata Operations would deliver costs of ~$1 billion more than the benefits often touted while threatening up to 10,000 jobs downstream from the trade – mainly in Southern Auckland.

 

From Radio NZ:

Moving Auckland port’s vehicle imports could cost $1b

10:10 am 21/12/2017. Todd Niall, Auckland Correspondent

Costs of moving Auckland’s vehicle import trade away from the waterfront port would outweigh the benefits by $1 billion, a report the council tried to suppress says.

Auckland’s port handles more than two-thirds of the country’s vehicle imports, and NZIER’s report looked at the costs and benefits of moving that business either to Northport, or Port of Tauranga.

It was commissioned by the city’s mayor Phil Goff, who favours relocating first the vehicle trade, then the entire port, but it was released to RNZ only after the intervention of the Ombudsman.

The Labour-led government has also promised to examine the prospect of relocating the port operations, with coalition partner New Zealand First having campaigned on moving the car trade to Whangarei’s Northport within two years.

However, NZIER’s analysis – the first detailed analysis of the possibility – found the costs would outweigh the benefits by about $1 billion.

“It is difficult to justify moving the vehicle imports from Auckland on either competitive or efficiency grounds,” the report said.

It found up to 10,000 Auckland jobs in the wholesale vehicle sector could be lost.

…..

“Many industries in the supply chain are concentrated around the residential suburbs in South Auckland creating employment opportunities in areas of socio-economic deprivation,” said the report.

…..

Source: https://www.radionz.co.nz/news/national/346673/moving-auckland-port-s-vehicle-imports-could-cost-1b

 

So the Benefit Cost Ratio or BCR would be below 1.0 with the cost of also 10,000 jobs from South Auckland also at hand. Given we give road projects with a BCR of below 1.0 grief like we did with East West Link Option F (now canned) then elected representatives should be taking an extremely hard look at the moving the port folly given its BCR is below 1.0 (Benefits are less than the costs of a project and should not proceed).

 

This bit from Mayor Goff is him grasping at straws:

Mr Goff said the report did not look at all the alternatives, and undervalued other uses of port land which could be freed up.

“The restoration of public access to the harbour which is why big cities around the world like Sydney and Brisbane have moved their ports out of their CBD,” he said.

“Secondly they haven’t considered the alternative use for example of Captain Cook Wharf for international cruiseline visits.”

……

Source: Radio NZ

 

 

The problem is for Goff is that the alternatives were looked at, it was called the Future Port Study. The Manukau Harbour is ruled out owing to the massive bar at the entrance, the Firth ofThames was deemed viable but mass amounts of dredging are required, while Tauranga and North Port (who were identified in the confidential report above) were also ruled out due to being outside the 100 kilometre radius sweet spot for efficient port to market operations.

 

Goff also mentioned Sydney and Brisbane who while they have moved their ports, those ports are literally around the corner out from their CBDs and into existing heavy industrial complexes inside the main urban area. Both relocated ports are also well inside the 100km radius for efficient port to market operations as well while North Port is 160km and Tauranga is 180km from South Auckland’s industrial complexes.

The Unitary Plan has port expansions as a Discretionary Activity to a set limit to which from that limit it becomes a non compliant activity. As a comparison Port of Tauranga’s Sulphur Point can not extend into Tauranga Harbour as it is a Prohibitive Activity in the Tauranga City Council District Plan. So the difference is port expansions are allowed in Auckland (to a degree) but not in Tauranga at all.

So if the Port files a resource consent, goes through the Hearings, is granted consent and survives a most likely Environment Court Challenge then the Port is able to proceed on its legal business. If the Environment Court ruled the other way then a hard look needs to be taken at the Unitary Plan and the Activity rating most likely moved (if that survives an Environment Court hearing along the way).

In the end though Goff is grasping at straws and I am still annoyed as I was when I first all raised this in 2015. As I have said before industry does not make for great ribbon cutting ceremonies but they are the engine rooms of a City and provider of jobs to those not working in a City Centre.

I hope elected representatives take time this Summer to reflect over matters like the Port and just maybe next year give a little bit more respect to our industrial complexes. You would not be enjoying your mod-cons without said complexes and the trade links they support!

 

NZIER Report into Moving the Port

Port-of-Auckland-relocation-NZIER-Report