Private sector logistics expertise needed, now

We have a Covid-19 resurgence plan they said, and for 102 days New Zealanders breathed a sigh of relief and believed them. Even if they didn’t have a plan, 102 days was long enough to develop one, right?

If the past week is anything to go by, if we have been operating under a plan, I’d hate to see what they call chaos.

Sort out the port, they said. Great idea, everyone’s drinking more at the moment, where is that bottle of port I was gifted by a European diplomat one time? No, no, the sea port, you know, the one we don’t like and want to close or move because it makes cycling the waterfront difficult.

But all of the goods we need come through those ports and tens of thousands of workers are on and off the ports 24-7. And the Health Minister has said not to test well people because there’s such a demand on the testing regime; we can’t manage that in 48 hours.

Well we have to completely shut off Auckland, they said, that’s the plan – contain where the outbreak is, maybe throw some red-herrings about how it could have been transmitted like, frozen food, and get lots of uniformed people on the road borders.

But Auckland is responsible for 40 percent of the country’s economy, and food and essential supplies flow into/out/and through it. Closing off Auckland will cost 250 jobs a day. And what happens to Northland – it becomes an island? The food producing part of Auckland straddles the Waikato border – how’s that going to work?

For the trucking industry, instruction by the Government on two borders – sea and the borders containing Auckland under Covid-19 Level 3 response – have been the cause of confusion, concern and disruption to business. After the first half of the year and the total lockdown of the country, businesses are already struggling. They cannot sustain hit after hit when it appears there is no real plan.

It has been a frustrating week. The Government saw sense on the sea ports fairly quickly when it became apparent, they could not meet their own order. The road borders however, have shown how little is known about the flow of the supply chain and how ill equipped the government is to manage logistics.

Government has all the time and all the money. Projects frequently run over time and over budget. There is not the discipline that exists in the private sector where time is money. If people fail in the private sector, they are let go.

Throwing more people at the top and more military on the front line is not the answer. This Government has an aversion to business, but they need the expertise of people who have to bring in money to survive. It sharpens the senses and breeds efficiency.

People in the supply chain, such as those in the trucking industry, understand logistics.

Every day, they plan for people to load trucks and take goods all around New Zealand, within legally set timeframes for the amount of time they are allowed to drive and work.

Being a human chain, there are breakages when a person is sick, has an accident, gets stuck in traffic, etc. That break is pulled out of the rest of the chain, adjustments are made, and the flow continues. Food gets delivered to supermarkets, medical supplies get delivered to hospitals, shops and businesses get what they’ve ordered, households get moved, and New Zealanders get to enjoy a high standard of living.

The performance of the Auckland road border shows no logistical planning was undertaken. Rules are being adjusted daily. It’s make-it-up as you go. People can’t get to essential jobs without a full folder of paper work. We fail to understand why the Government is not reaching out to people who are expert in this work.

More people at the top will not fix this response. Rolling security guards and bringing in more military will not fix this. More people around the “working” table with expertise, pragmatism, calm-heads, logistics experience, and a cognisance of how much money companies are bleeding daily is what is needed, right now.

– Nick Leggett, CEO, Road Transport Forum

Time to take a breath on port decisions

I fail to see why there is the perceived need to rush into moving Ports of Auckland, or the rush to pick a favourite to replace it.

So, I was pleased to see the Government release, this week, a sensible and measured report that stopped the push to develop Northport in its tracks. The promises around Northport were only ever based on New Zealand First’s desire to secure the Northland electorate seat at this year’s election.

RTF has spoken out against the move to Northport on many occasions because of the cost it would add to move freight further away from its end destination. That’s before you even get into logistics and environmental impacts.

As a country facing severe economic hardship in the wake of Covid-19, the Government cannot afford to spend money on poorly thought-out projects that don’t stack up on costs versus benefits.

The government-commissioned report prepared by Sapere Research Group – Analysis of the Upper North Island Supply Chain Strategy Working Group Options for moving freight from the Ports of Auckland – endorses the folly of a rushed move to Northport. The report says that assessment of regional economic development effects suggests that, on its own, a relocation of port activity is unlikely to substantially alter regional economies. It says most of the gains would be felt in regions outside where the rise in activity takes place.

The argument that moving to Northport would benefit the Northland economy is dead in the water.

The report also endorses our point that it is clear that distance to market is critical to the supply chain and that Northport is generally considered too far from main markets to function as a primary import port. It is worth noting that 80 percent of New Zealand’s freight is distributed to points south of the current Ports of Auckland.

What’s at play here? Influential Aucklanders don’t like the look of a working port in their downtown area and, at some point, Ports of Auckland will reach capacity – though Covid-19 might extend that timeframe.

Aside from the optics, the country needs to look at how it can best manage the flow of exports and imports that are the mainstay of our economy. We cannot become so isolationist in our response to Covid-19 we forget that. We are already seeing a worrying trend with global airlines responding to the New Zealand Government’s border policies.

It seems to be a peculiar New Zealand thing to respond to big issues by quickly coming up with options A or B and force a choice, when it need not be a binary choice.

The Sapere report suggests we have a good 30 years to tackle capacity issues for Ports of Auckland. They look at the current options on the table and conclude a new port in Manukau Harbour is the number one contender in a cost-benefit analysis. This has been met with some derision due to the nature of New Zealand’s west coast tidal flows and the suitability for shipping.

Again, this reflects more on New Zealand’s decision-making capability rather than the well-researched report.

Sapere acknowledges that long lead times for planning, consenting and constructing port capacity outside Ports of Auckland mean there is a shorter window of time for a decision about the long-term strategy to future proof port capacity. That window is approximately 10-15 years.

Surely, in that time, there can be a sensible assessment of what the problem we are trying to solve is and how best to solve it, rather than trying to retro-fit a solution to meet the needs of politicians, or other vested interests.

The problem is: How we can increase port capacity, anticipating growth, for exports and imports that flow through the upper North Island supply chain?

We’re supposed to be this innovative little country that punches above our weight. You’d think we could solve that problem over 15 years.

– Nick Leggett, CEO, Road Transport Forum