Let’s Buy Port Kembla Ourselves

Let's buy Port Kembla Ourselves, writes Dr Mike Donaldson.

The NSW Government has now passed the legislation enabling the privatisation of Port Kembla and expressions of interest by its potential buyers will close in a couple of days. Some say that the Government should have passed the enabling legislation only after all the expressions of interest were all in, but no doubt the Government is very aware of the huge problem it faces.

Opposed to the privatisation are the Wollongong and Shellharbour City Councils, the South Coast Labour Council and, according to an Illawarra Mercury Poll, 70% of us. This will be causing South Coast Liberal MPs Shelley Hancock, Gareth Ward and Lee Evans some concern. 



Two of their Liberal colleagues on the Wollongong City Council have distanced themselves slightly from the privatisation mainly on the basis that the promised return to the Illawarra at two years current profit from the Port, is far too low. Their dilemma is that the more rapidly the Government pushes forward with the privatisation, the more vehement the opposition to it will become. News that natives like ourselves are becoming increasingly restless will tend to drive the price of Port Kembla and the Illawarra’s share of it, further down, which is what they are trying to avoid.

What an Occupation of the Port by the people who built it, work in it, live near it and paid for it with their taxes, might do to the price is any one’s guess.

One of those interested in buying the 99 year lease is the Queensland Investment Corporation (Illawarra Mercury 15/10/12) which manages funds worth $60 billion. It is owned by the Queensland Government. One of the questions the Minister for the Illawarra and Minister for Finance Greg Pearce will confront when he addresses us all in the Town Hall on Wednesday 7 November is what financial value does the Queensland Liberal Government see in our Port that his own Liberal government in NSW does not? And perhaps he will explain how passing a flourishing state-owned local business to another state-owned Queensland enterprise is privatisation.


It is rumoured that the Chinese Overseas Shipping Company (COSCO) might be keen. It has just taken over the Port of Piraeus, Greece’s largest port, on a 35 year lease for $5 billion dollars. This makes the $500 million said to be about the price of the 99 year Port Kembla lease, small change. This vast conglomerate is a Shanghai-based state-owned enterprise with interests in international shipping, sea and air freight forwarding, trucking, terminals and warehousing, trade, industry, financial affairs, insurance, real estate, tourism and medium-level and higher education, ports and contract employment. No doubt the Minister for the Illawarra and Minister for Finance will be able explain how this possible government-to-government sale is about privatisation and how it might benefit us when he visits us on November 7.



This might be difficult to do, for from the employment end, COSCO looks very bad. No doubt the National Council of the Maritime Union which is meeting as I write this, will be seriously pondering the fact that COSCO in Piraeus doesn't allow unions or collective bargaining among its 500-plus Greek workers. Wharfies there are employed on a temporary basis, with no benefits and regularly work eight hours without meal or toilet breaks.

In the end, if the people of the Illawarra are unable to prevent the privatisation of Port Kembla, I think we should buy it ourselves. No one of any political colour, size or shape is saying that the crisis of capitalism is nearing its end. Everyone is saying that it will deepen and worsen. In such times, sensible communities harbour their resources and protect their assets. And there are examples of this close to hand. Now under a popular Liberal Mayor, Shoalhaven City Council’s water utility Shoalhaven Water became an electricity supplier last year by generating power from its own water distribution network. Shoalhaven Water is confident that it will develop further power generation projects using its assets owned by Shoalhaven ratepayers.



Where apart from local government, might the money to buy our Port come from? Certainly the 391% leap in the value of non-residential building applications reported recently in the Mercury (15/10/12) suggests that there is investment money around in the region. 



Further abroad, recently the Prime Minister backed a “strategic co-investment” in General Motors Holden which will receive $215 million from the federal government, $50 million from the South Australian government and $10 million from the Victorian government. I don’t see why it should be impossible for our local Federal MPs Sharon Bird and Stephen Jones who have been actively supportive of the Save Our Ports movement, to discuss such a possibility.

So could the opportunity for a public/private partnership be considered such as the one that our Mayor Gordon Bradbery recently said in the Mercury (19/9/12) was being negotiated to build the Maldon-Dombarton line. 



Then there are the massive not-for-profit Industry Superannuation Funds which have been roundly criticized for over-exposing their funds on the stock market and failing to invest in basic infrastructure. Their management includes capable and approachable trade union leaders. 



Who might gather these strands up and develop a vehicle to bring some of these players together? I can think of no better body than the City Council’s recently formed Economic Development Advisory Board. Business leaders from the Property Council of Australia, the Illawarra Business Chamber and the Australian Industry Group welcomed its formation, saying that it is common sense to include the private sector expertise of people working to drive economic growth. What we need from the Board is a speedy and accurate assessment about the chances of putting a plan like this one together because we certainly have the knowledge, skills and political will to pull it off.