Jumbo jets, but no shipping line'

Press, Volume CX, Issue 32459, 20 November 1970, Page 3

Jumbo jets, but no shipping line '

(N.Z. Press Association) WELLINGTON, Nov. 19. The Government would spend s2lom in foreign exchange purchasing jumbo jets, yet it was not prepared to establish a national shipping line at the cost of ssom to s6om. Mr W. Martin, president of the New Zealand Seamen’s Union, said this today to the Commission of Inquiry into merchant shipping. The possibility of buying the Union Steam Ship Company was the first opportunity New Zealanders had had to resume international shipping services without having to start from scratch, he said. If Thomas Nationwide Transport succeeded in its bid for the Union Company the activities of the company would be Australian-control-led.

With the Railways Department operating between the North and South Islands, there would be a diminishing demand and profitability of coastal shipping services. This would make the operations of Thomas Nationwide Transport in New Zealand the least profitable of the company’s divisions and freight rates would be adversely affected. Mr Martin said that in discussions with Thomas Nationwide Transport, its Managing director (Mr E. H. P. Abeles), told him his company would discontinue any uneconomical lines.

Mr Abeles was referring to those Union Company lines which at present incurred heavy losses, but were continued out of national interest, Mr Martin said.

Under examination by Mr R. Edgley (Shipowners’ Federation), Mr Martin said his union preferred the retention of the present ownership of the Union Company to the running of the company by Thomas Nationwide Transport.

A corporation similar to National Airways Corporation and Air New Zealand, but with more private enterprise influence, could well be responsible for New Zealand sea transport, Captain J. F. Holm said in a submission on behalf of the Holm Shipping Company, Ltd. A wholly owned Government shipping line was not advocated but rather one with 40 per cent overseas interest, 30 per cent New Zealand interest and 30 per cent private enterprise, Captain Holm said.

Sea transport was the cheapest of all, yet the industry’s main competitor, the Railways Department, was given unfair advantages. Among these were the writing off of large sums of capital, granting of interest-free loans, and the knowledge that the taxpayer would foot the bill for any losses. This had enabled the Railways Department to trim its rates in various ways and to undercut coastal shipping, in some cases putting it out of business. The Minister of Finance (Mr Muldoon) had recently mentioned new loans for the Railways Department, but he had not suggested any for shipping. It was unfair that New Zealand exporters were exempt from paying payroll tax. Exporters could not possibly market their goods without shipping companies to carry them, so ships were equally important in the export drive. Included in Captain Holm’s recommendations

were reconstitution of the Marine Council, subsidies for guaranteed freight and ship building, and the implementation of a roster system as in Australia.