CONTAINER SERVICE Government Approves, With Reservations

Press, Volume CIX, Issue 32032, 5 July 1969, Page 1

CONTAINER SERVICE Government Approves, With Reservations

(New Zealand Press Association)

WELLINGTON, July 4.

The Government approved today the introduction of container ships for the New Zealand-United Kingdom trade by the British Conference Lines, but reserved the right “to insist on such rules as may be appropriate for the future operation of the services.”

However, it has not so far formally endorsed the recommendation of all reports on containers that Wellington and Auckland be the two New Zealand terminals.

Informing the lines of the Government’s decision, the chairman of the Cabinet Overseas Shipping Committee, the Minister of Labour (Mr Shand) said that much remained to be decided before a container shipping service between Britain and New Zealand became a reality.

Mr Shand said that among the matters the Government reserved for discussion were procedures for fixing freight rates, and equalisation of freight rates between conventional and container ships or for diversion of cargo between ports.

These were matters for consultation with the freight negotiating body. A Government representative must be present at meetings of this body. The Minister told the lines that in the national interest they might be required to domicile part of their shipping operations in New Zealand. He hinted that the Government might even nominate a New Zealand-domiciled operator as a member of the conference. The Government’s announcement was contained in a statement by Mr Shand and a copy of a letter written by him to Mr J. R. Shorter, the general manager of the Overseas Shipowners’ Committee, in Wellington. This letter was read to Parliament just before the House adjourned at 4 pm. for the week-end recess.

“While there are a number of issues still to be resolved, it would be to the ad-

vantage of this country that you should proceed with the ordering of your ships,” Mr Shand said in his letter. The lines had called for a reply to their container proposals. issued earlier this year, by the end of June so that the four necessary container ships could be ordered. The service is planned to begin before the end of 1972. On Wednesday, the Cabinet Committee had a threehour meeting with the Harbours Association, which did not include Auckland and Wellington harbour representatives. Mr Shand said today the Government felt decisions should be reserved on four of the five specific requests made by the association concerning the role of secondary ports in the container age. He did not say what the requests were.

No mention was made in Mr Shand’s statement of the two heavily recommended

container ports for New Zea-land-Auckland and Wellington. Acceptance in principle of these two ports was one of the conclusions reached by the Transport Commission.

He said the Cabinet Committee had given careful consideration to those aspects of the lines’ proposal which would have to be reserved for further consideration.

“The shipping lines are engaged in a commercial operation, contracting with New Zealand importers and exporters to carry goods to and from the United Kingdom,” Mr Shand said. “A decision as to the kind of ships they employ for this service is primarily one for the lines themselves, but because of the far-reaching changes this would cause in the pattern of transport in New Zealand, the Government felt it proper to take expert advice to consider the objections which affected parties might make.”

The Cabinet had reached a tentative agreement on the re-

ply for the shipping lines at the end of last week, but considered it proper to withhold final consideration until the Harbours* Association had an opportunity to make final representations.

The matters raised by the Harbours Association were not new. All of them had been raised before and had been considered by the Cabinet.

“The Harbours’ Association made five specific requests,” he said. “On four of these the Government felt the decision should be reserved, since they concerned matters of principle m the future operation of shipping services. “The fifth point raised by the association was a request that the shipping lines should be instructed by the Government to buy a smaller type of container vessel.” Responsibility The Government felt it could not agree to this point. “If the Government were to instruct the shipping companies as to the type of vessel which they may or may not use in the trade, the Hues could ask quite legitimately that the Government should accept financial responsibility for the success or failure of the operation,” Mr Shand said.

“This is the responsibility of the shipping lines themselves, as commercial opera-

tors. They have decided that four 1400-contalner vessels will provide the most economic and efficient service.”

The procedures for fixing container freight rates must be approved by the New Zealand Government, Mr Shand said. “We will require that provision be made for the interested parties to have adequate representation on the negotiating body, and we consider that a representative of the Government must be present, at least in an observer capacity with the right to report and comment on any agreement arrived at,” he said. The Government reserved the right at any time, when

it was considered desirable in the national interest, to require a “progressive move” to the domicile in New Zealand of a part of the United Kingdom-New Zealand shipping operation or of other shipping operations in respect of New Zealand trade which might be developed by the British Conference Lines. N.Z. Registration

This, might be implemented by a decision of one or more of the members of the conference lines to domicile in New Zealand its registration as a company, and the registration of an appropriate part of its fleet.

This could also be done by the admission to the’ conference of a New Zealanddomiciled operator nominated by the New Zealand Government