Improved competition in outward shipping urged

Press, 31 January 1983, Page 2

Improved competition in outward shipping urged

PA Wellington Competition should be improved in New Zealand’s outward shipping trades, according to a discussion paper on the stae of the country’s shipping industry, released yesterday. The paper, prepared by the Ministry of Transport, is designed to promote discussion on the shipping industry before the Government overhauls the present system.

The industry study follows up similar ones made last year which resulted in major changes being proposed to land transport and civil aviation.

In his introduction to the discussion paper, the Secretary for Transport, Mr A. J. Healy, said that compared with other transport modes there was a “relative absence” of governmental regulation and intervention' in shipping. This had contributed to the efficiency of the industry. However, Mr Healey saw little prospect of either international liner shipping ceasing to organise itself along

cartel lines, or of the majority of New Zealand’s trade being carried by foreignowned and foreign-controlled lines.

“Against this background, I consider it desirable that steps be taken to preserve and enhance competition for the benefit of New Zealand shippers,” he said. The paper proposed new shipping legislation, along the lines of similar measures in Australia and Canada, providing for registration with the Government of all tariffs, agreements, and services offered by all ship operators in New Zealand’s international liner trades. The legislation should also provide for the designation of shipper groups to negotiate the terms and conditions of carriage with operators. The paper proposed the establishment of a shipper’s secretariat under the new legislation to be responsible for the registration of ship operators, tariffs, and agreements.

“Given New Zealand’s continuing diversification of products and markets, shipper representation in freight-rate

negotiations should extend beyond the producer boards,” the paper said. “It does not seem necessary, however, for shippers to be represented by a single shippers’ council. But it is essential to ensure that the advantages obtained by one group of shippers are not gained at the expense of another group. The interest of shippers in having efficient, competitive services must be met across all commodities.”

The paper said it was desirable to confirm that the Shipping Corporation of New Zealand should continue to work on a wholly commercial basis. If the Government required it to undertake specific ventures unlikely to make a profit, the corporation should be able to seek appropriate compensation. “The corporation’s results have shown that where commercially competitive New Zealand shipping is available, a New Zealand presence in our overseas trades is desirable,” the paper said. “So that all New Zealand ship operators may participate equally, however, the corporation should not be

accorded sole ‘national line’ status. It should instead be one national flag carrier.” In order to provide for future trades that were subject to cargo-sharing arrangements, the proposed new Shipping Act should permit the designation of “national flag carriers”, the paper said. Such carriers would be New Zealand-man-aged and controlled and their vessels in the New Zealand register, which would replace the present arrangements under which New Zealand vessels were entered on the British register. Announcing the proposed shipping review last year, the Minister of Transport, Mr Gair, gave an assurance that it would not result in a sudden surge of Government regulation. “What we seek is a policy framework that will maintain the industry’s independence while giving us the assurance that it is directly relevant to the country’s needs and is as efficient as possible,” he said. Mr Gair said he hoped the paper would promote wide public debate.