TOR for Port Plans Review

Rumour has it that various players in Ports of Auckland and Council's Investment entity expect to be given the job of reviewing their own plans after Auckland Council's decision this week that Port of Auckland's Expansion Plans should be reviewed.

Like many others I welcome this decision as an appropriate spanner in the works. I imagine that many in Council see it more as a kick for touch, and merely a mid-course adjustment. That is why it is important that the Terms of Reference for the review, as well decisions about the Political Steering Group for the review, and the decision about what organisation actually writes the review are themselves made properly.

There is a fair dose of wishful thinking in the words used in Auckland Council's review motion. For example:

...there will need to be integrated and coordinated capacity development across the Upper North Island to meet future freight demand and avoid a shortfall in port infrastructure capacity...

These words were supported by comments to the effect that Ports of Auckland need to form "partnerships" with other entities like Ports of Tauranga or Northport. However that really is wishful thinking. As Cllr Mike Lee noted in his comments at the meeting, such relationships which might be construed as collusion, are essentially against the law in New Zealand whose legislative environment pits Port against Port, and requires individual Ports to invest heavily and offer discount deals to attract container custom from shipping companies.

Needless to say, Auckland is not the first city to review its port expansion plans. For example Dublin reviewed its port plans in 2007.

The Terms of Reference for this study involved an examination of the role of Dublin Port and its future. The study was in particular tasked to examine the costs and benefits of various scenarios relating to Dublin Port, including:

i. Relocating all or part of Dublin Port’s existing activities to an alternative location(s);
ii. Existing port activities continuing to expand with demand; and
iii. Port activities continuing at current levels with growth being catered for at alternative location(s).

The policy context in Dublin is not the same as Auckland, but it's not a lot different as this summary shows:

In relation to ports policy, the Department of Transport’s Statement of Strategy 2008-2010 summarises the key tenets of ports policy which is “to ensure investment in ports meets port capacity requirements and to facilitate the availability of commercial port services which are effective, competitive and cost efficient”.
The National Development Plan emphasises that the State-owned commercial port companies should fund their operations and infrastructural requirements without recourse to the Exchequer, either from their own resources or by other avenues such as efficiencies, increased charges, disposal of non-core assets, borrowing or private sector investment. The present ports policy is essentially market led and does not attempt to implement an interventionist planned approach.

Interestingly, one of the triggers for the Dublin review was a proposal that the Port of Dublin be expanded through a further reclamation of 21 hectares. The review compares net present values, and present cost-benefit assessments of alternative approaches to creating that extra freight handling capacity. Among the scenarios considered was:

Dublin Port would be retained but capacity would be capped at current levels with other ports developing to meet capacity requirements....

I won't spoil your fun by telling you what was advised because these stories never have quick and tidy endings.

In 2007 the City of Melbourne reviewed its port planning. A Government Commission was required to:

...undertake a review of the impact of port planning on competition in the provision of container stevedoring and related services in Victorian ports.
This follows from the Commonwealth of Australian Governments entering into the Competition and Infrastructure Reform Agreement (CIRA), which, among other things, requires each jurisdiction to undertake a review of port competition and regulation.

I came across a number of similar reviews. The common factor is the issue of competition - the extent it delivers economic efficiency for freight movements - and planning - the extent to which it undermines competition. The Melbourne review covers:

• the Port of Melbourne and, in relation to potential new container service providers, the Port of Hastings.
• container stevedoring, container handling and storage, container transport (road and rail) and intermodal services.

The Commission has been asked to:
• examine whether there are any restrictions on entry or other barriers to competition in the provision of stevedoring and related services in current port planning frameworks
• if it finds that there are restrictions to competitive entry, make an assessment of the costs and benefits of such restrictions
• assess whether the market structure for stevedoring services impacts on competition and the efficiency of container handling, storage, transport and intermodal services, and how the market structure for container stevedoring and related services impacts on: the achievement of the Government’s objectives, particularly the target for rail to have a 30% share of port freight; land-side interface efficiency; and achievement of the Government’s other relevant objectives.

This was a Government triggered review. You can see its emphasis on the theory of competition. It asks questions about how easy it is for a "new entrant" to come into the industry and establish a competing service. You can see that it was also essentially about "stevedoring" which is the loading and unloading of cargo. It appears that at the port of Melbourne there are two major operators: Patrick (Asciano) and DP World, presumably competing with each other. There is only one operator in Auckland's Port. There is no competition there. You can think of stevedoring as just the act of putting a container on a ship, and taking it off, or you can go wider and think in a broader freight logistics sense - and consider freight movement end to end.

This broader sort of thinking is what is needed in Auckland's review. A whole of North Island look - rather than the sort of narrow Ports of Auckland look that could be expected if POAL or its owner - Council Investments Ltd - did the review. It's the big picture review that Auckland needs. Not some head of the pin analysis of wharf side stevedoring.

The review now underway in West Australia is a better example for Auckland I would suggest, based on a quick look. That review is being conducted because: "the State is now entering an environment of rapid economic growth and burgeoning demand for port services, particularly relating to the resources sector it is timely to review the current port governance arrangements....". The review examines:

• the respective roles and responsibilities of Government agencies including the Department of Transport, Department of Treasury and Finance and the Port Authorities to ensure ports are able to deliver effective and efficient outcomes for the State;
• provide recommendations for structural or legislative changes desirable to improve the effectiveness of ports in ensuring that key Government objectives and outcomes are achieved;
• provide guidance in relation to the current processes for port planning and investment including examining the process for capital works approvals, funding models and competition between ports for freight;

Those to be consulting for the review include: All Port Authorities; Ports WA; Department of State Development; Department of Treasury and Finance; Department of Premier and Cabinet; Minister of Transport; and Key industry representatives and stakeholders (which include: Port User Groups; Councils at port sites; Dept Environment & Conservation).

This sort of review would look at the fundamentals. Central Governmment must be aware that port competition is not delivering economic efficiencies. What we are witnessing is market failure on a grand scale. Arguably port infrastructure in New Zealand is as important as road infrastructure. But because we are a small country, with small ports, each port has only one operator, and in reality there is no competition for wharfside stevedoring. Port competition in New Zealand is an ideological construct, it's a myth, that is why we need a fundamental review, with the Ministry of Transport at the table.

Proper Process on Waterfront

Last week was a big week for Auckland's waterfront. And I'm not talking about the strike. Thanks to a huge amount of work from Heart of the City (Alex Swney and Greg McKeown), the Auckland Architects Association (Adam Mercer), and the Devonport Borough Council (Roger Brittenden and Margot McCrae), and many others behind the scenes, the Auckland Council agreed to review the plans it included in its draft Auckland Plan (the Spatial Plan).

The New Zealand Herald also played its part in bringing about this decision, as is evident from the way it reported Council's change of plan.

I was pleased by the fact NZ Herald ran an opinion piece I wrote challenging the Mayor's notion of what constituted proper process on the waterfront, and because this is my blog, I'll quote it here:

Due Process on the Waterfront

Auckland Council’s Mayor has tried to reassure the public that any expansion of Auckland’s port will: “go through proper processes and be fully debated by council and public…” (NZ Herald, Feb 28). Mayor Brown is reported as saying: “…increased container traffic might create demand for new berths and this will be dealt with at the time by the resource consent process.”

I fear that Mayor Brown’s faith in Resource Management Act processes to deal with matters of public interest on Auckland’s waterfront raises questions about his Council’s commitment to planning compliance, and about what proper processes are.

Legislation establishing the Auckland Council required it to prepare and adopt a spatial plan to provide a long term strategy for Auckland. This is a different approach to planning. The spatial plan’s objectives have to refer to the social, economic, environmental and economic realms to align it with the four well-beings referred to in the Local Government Act 2002, and to broaden the purpose of the spatial plan so that it is not simply about growth and development.

Auckland Council has prepared a draft spatial plan which is out for consultation now. Public concern has arisen because Council’s spatial plan documents all incorporate – without question or serious consideration of alternative options - Port expansion plans which assume a 400% growth in container volumes and 18 hectares further development of Waitemata Harbour through reclamation.

Concern has arisen because the Waterfront Development Agency (WDA) which is the Council controlled organisation responsible for preparing Auckland’s Waterfront Masterplan – a central component of the Auckland Spatial Plan - restricted its consideration to exclude Port of Auckland Ltd (POAL) and its expansion plans. The WDA’s Masterplan for Auckland’s waterfront concentrates on the assets that it owns. These exclude Port assets which are ‘managed and operated’ by Auckland Council Investments Ltd (ACIL) – another council controlled organisation. Its statement of intent says ACIL, ‘will endeavour to develop and implement a long-term strategy for POAL which seeks to improve POAL’s productivity.’ It also states that ACIL, ‘will identify and resolve potential conflicts between POAL’s operational requirements and other waterfront activities and plans of strategic significance to the region.’

Mayor Brown is an optimist, and that’s a good thing, but he’s dreaming if he believes that a Waitemata Harbour resource consent process is the right place to resolve the policy conflicts that inevitably exist between this proliferation of organisations, let alone with public interest considerations.

The buck clearly stops with Auckland Council when it comes to the adoption of a spatial plan for Auckland. By law, the Auckland Spatial Plan must, ‘enable coherent and co-ordinated decision making by the Auckland Council and other parties to determine the future location and timing of critical infrastructure.’ If that isn’t clear enough, the law also states that Auckland Council, ‘must identify the existing and future location of critical infrastructure.’

The spatial plan is intended to set a strategic direction for Auckland and its communities that ‘integrates social, economic, environmental, and cultural objectives’. It is about integrated planning. It is not about a proliferation of separate plans - one for the Port, one for the rest of the waterfront, and one for the downtown city. That’s what Auckland had before amalgamation.

And if 20 hectares of new reclamation is not ‘critical infrastructure’ I don’t know what is. The Port Expansion Plans need to be in the spatial plan – or not – after due process. Not put in the ‘too hard’ basket and left for some future Council to deal with by applying for a resource consent.

The Resource Management Act does have its place in Auckland waterfront planning. Many praise the planning work that delivered what the public love and now enjoy down at the Wynyard Quarter. Auckland City Council and Auckland Regional Council sweated blood over plan changes and resource consent applications and public hearings hammering out the planning framework for what we see today.

That was due process, once fundamental and broad brush decisions had been taken about how the land and water spaces would be used.

It respected matters such as heritage and the public interest in, and enjoyment of Auckland’s waterfront.

Unlike the way Auckland Council is handling waterfront development right now. Under Mayor Brown’s leadership, Auckland Council is planning a major change in the use of Queens Wharf (Auckland’s Primary Cruise Ship Terminal), which has a raft of environmental effects (traffic on Quay Street, passengers in buses and taxis, conflicts with public access and ferry traffic, engineering work on a heritage building), apparently without going through due process.

Last week I was advised that no decision had been made to publicly notify any consents for the development of Queens Wharf.

No responsible Council would allow a private developer to do what Auckland Council and its ‘council-controlled organisations’ plan to do with Queens Wharf. Not without a decent set of resource consents and conditions.

It’s good to talk about ‘proper process’, now it’s time to walk the talk on the waterfront.

Behind the scenes there are those who say, "but the Spatial Plan has no statutory force...." almost as an excuse to defend the use of the resource consent process as the best way forward. However, as the Council officer advised the council during its meeting, any resource consent application must "have regard to any other matter the consent authority considers relevant and reasonably necessary to determine the application..."

The Auckland Spatial Plan - which is a statutory requirement - and which has been consulted extensively - might be regarded as having "no statutory force" by some - black letter of the law types. But it must be a relevant matter, otherwise why have one at all?

A major requirement for the idea of a spatial plan is to enable Auckland to plan for what it wants in future. The Resource Management Act has a purpose to avoid adverse effects. We need that. But we also need a plan that sets out a future. And that plan needs to include an agreed plan for the Port. The old Port expansion plans of 1989 need to be reviewed in the light of new thinking in 2012.

Auckland Waterfront Lacks Leadership

Went to the Auckland Waterfront Forum yesterday. Four presentations: Feedback from Waterfront Development Agency "Masterplan" consultation; Wynyard Quarter Public Space Project; Queens Wharf Development; and Westhaven. Very interesting. Then questions. Major concerns emerged from the floor. Not well handled from the front. Hence this open letter....

Dear Bob,

You're not going to like this letter but you like robust feedback. One of the things I liked about the way you got the meeting going was when you spoke directly to Alex Swney and told him you respected what he was doing with 'Heart of the City'. You reflected and said, "we don't care enough about enough in this city..."

And I liked the breakfast. Man that Bircher Muesli was the best I've had in ages. And great idea to serve it in those fancy cocktail glasses. Must've cost an arm and a leg though. Thought we were on a budget....

Enjoyed Brenna's feedback presentation. I can imagine how much effort went into smoothing out the wrinkles. You clearly liked the fact that 83% of the feedback was positive. Well. The public like what they see on Wynyard - and most were duped by the glossy images in the coffee table publication you put out. A few of us understood enough, saw behind the pictures enough, and cared enough, to put in submissions of concern about the 1989 Port-Expansion plans that were buried in there and the hasty Cruise-on-Queens plans. These concerns did get a mention from Brenna.

What also got a mention was the Peer Review you had done by Arup Australia of your Waterfront Development Plan consultation process. This has to be a must-read. I saw there in the fine print of Brenna's presentation on screen that you guys got a 'tick' for heritage and stuff, but you got a 'cross' for environment and leadership. That must've come as a bit of a shock to the Board.

After Brenna we had Henry Crother's excellent work on Wynyard's public spaces. And then Queens Wharf by staff member John Smith who I remember well from my time at Auckland Regional Council. Then Westhaven. And then questions. And statements.

It was pretty much sitting room only in the Floating Pavillion which had gently rocked us all throughout. Not to the point the Bircher Muesli was threatened, but a few of us were a bit seasick.

Jasmax Principal, Richard Harris made the ballsiest statement. It was ballsy because Jasmax have been retained to do the Queens Wharf Shed 10 Cruise Ship Terminal design. You hardly every hear from contractors, or would-be contractors, in an environment like that. Don't bite the hand that feeds you. But these are the guys who know their onions. And they care. But there is a sort of misplaced code of ethics that shuts most of them up - just when you really need to hear from them. So we heard you Richard. Richard said loud and clear that the Waterfront Masterplan was not an Integrated Plan - because it had not properly considered the Port Expansion plans. His was a leadership statement.

I hope you heard what Richard said, Bob. Really heard. Because if you didn't you're in the wrong job.

Greg McKeown also asked you a question, Bob. But you didn't really answer it. Greg started by saying he was heartened by your sympathetic words recognising public concerns about the Port plans, but that he couldn't quite reconcile those words with the technical papers and policy positions on your website. I don't think you heard what Greg was saying. He is always polite. Or maybe you decided to smile and move on. But you're not a man averse to a down-trou, so I'll say it plain. You're being two-faced about the Port, Bob. Is that your Board's position too?

There is that big Arup 'X' against your leadership....

To be fair, Bob, you did describe the Port as 'the elephant in the room...'

But the Port isn't the only elephant.

In Brenna's presentation the Waterfront Forum was advised that Queens Wharf Cruise Ship terminal Resource Consents would be 'granted in July 2012'. I used my question to ask John Smith what consents were being applied for, what the process would be, and whether the applications would be notified.

John told the meeting that discussions were occurring with Council staff, and that he would get back to me when he had more information.

I have to tell you Bob, that I was somewhat disappointed to hear this. You praise the planning work that delivered what we see at Wynyard. You probably know that Auckland City Council and Auckland Regional Council sweated blood over the plan changes and resource consent applications and public hearings that hammered out the planning framework for what we see today. So John's answer to my question should concern you and your Board. It's shonky.

Bit like that stormwater pipe in Glen Eden. Shonky.

You guys are planning a major change in the use of Queens Wharf (Cruise Ship Terminal), with a whole pile of different environmental effects (traffic on Quay Street, passengers in buses and taxis, conflicts with public access - all different from before), without going through due process.

Would you allow a private developer to do what you plan to do with Queens Wharf without a decent set of resource consents and conditions?

Auckland Council is the other elephant that was in the room yesterday. The biggest elephant in fact.

Show your board and Auckland some leadership Bob. Then we'll give you a 'TICK'.