On Day 23 of the Rena Disaster, Skipper Key sailed into Tauranga last week to view the ship on the rocks. There were no “Mission Accomplished” banners though, because with hundreds of tonnes of oil and 1300 containers, some with poisonous chemicals, still on board there is still a great risk to the livelihoods of the people of the Bay of Plenty, birds and marine life in and around this reef that was once teaming with life.
John Key was asked about the total cost of the clean-up and gave one of his usual less than confident answers: “It’s a big number. $70 million, $80 million or $100 million maybe”. Of course, as usual, he failed provide was an answer to the hard question: Who is going to pay for the costs of this disaster?
John Key and Steven Joyce were adamant in the early days that the owners were liable for all costs but that all changed when reality caught up to the spin. That hasn’t stopped Mr Joyce from spinning some more. Yesterday he reminded us that the owner’s insurers have said they will meet their liability. But that is no assurance at all, because the owner’s liability is limited by law and as a result the taxpayer will have to pick up the a big chunk of the tab.
This was not just an accident. It looks as if the grounding was an act of negligence and that fault was involved. Someone other than the taxpayer should be liable for the consequences.
It seems most likely that the community would have benefitted significantly if the government had signed up to the Bunker Oil Convention in 2009 when Australia and Canada did.
The penalties available under the Maritime Transport Act are not enough to meet the cost of the clean-up and losses to businesses. Skipper Key needs to provide answers to questions being raised by residents of the Bay of Plenty coast.
- What is the liability of the ship’s owner?
- Is the operator of the ship a difference legal entity to the ship owner, and if so what, consequences flow from that?
- Why does Mr Joyce appear to deflect responsibility onto the charter Company?
- Is it because his inaction on the Bunker Oil Convention has let the ship owner off the hook?
- What is the liability of the charter company?
- Who are they liable to and are they only liable to the government for the clean-up or are they also liable to local businesses who have sustained losses as a result of the grounding?
- Can the shipping company escape their responsibilities because the ship is registered in Liberia?
- Would the result be different if the government had legislated to adopt the protocol to the International Convention on the Limitation of Civil Liability for Marine Claims?
- Would businesses and the taxpayer suffering economic loss as a result of the oil spill have a simpler and more certain remedy available if the government had legislated to adopt the International Convention on Civil Liability for Bunker Oil Pollution Damage?
Is Bill English Gilligan?
“Former energy minister Gerry Brownlee told the Maritime Union last August that the issue needed “serious consideration”, but no action was taken.
In a letter sent 14 months ago – when the Government was reviewing its emergency response system after the Gulf of Mexico disaster – Mr Brownlee agreed that we needed a specialised boat.
“We need to give serious consideration to having a vessel of this type 24/7 as part of a fast response in the event of any such emergencies occurring offshore in the future,” the letter read.”
How many vessels could we have bought for $70m?
How many vessels could we have bought for $70m?
Indeed.
I can’t stay out of this.
Given that Mark Gosche diverted $8m out of the fund to cover a potential oil spill of this type and the lack of any other policy to deal with the situation, I don’t think Labour should continue to bring this up in a negative way.
What Labour does need to do is, given that NZ depends on maritime freight to keep goods moving, issue a statement on how they are going to make sure NZ is in a position to react quickly and effectively if this were to ever happen again. Also there neeeds to be a thorough investigation to find the reason as to how the Rena came to be parked on the reef so that the lessons can be spread throughout the industry and hopefully minimise the risk in the future of a similar incident.
Let us be positive and try to get things done instead of continually looking in the past and throwing stones at each other.
Privatised profits and socialised losses – the way of the future.
ps Trev – teeming not teaming.
Bryce, how do you propose to achieve that when a Government was reviewing this very thing and decided not to do something it was told by the Cabinet Minister in charge that this vessel required serious consideration? Embarrassing politicians is often the only way to effect change and that involves holding their feet to the fire of their past misjudgments or non actions.
Tracey, I disagree. The best thing for New Zealand, is for the goverment and opposition parties to create legislation to a. prevent this from occuring and b. have systems and equipment in place to respond if it, and I sincerely hope it doesn’t, happens again.
Even if the public dissaproves of what is reccomended then at least you can say you have tried to do the best thing for the country and if required the documentation is there to implement if required when things inevitably go wrong again.
I guess it would make me a bad politician but I prefer to live or die by ideas and plans I believe in rather than use others misfortunes to make myself look good.
Bryce, I think again you have misunderstood me. I am saying to you tha when a Cabinet Minister impresses on his colleagues that something needs serious consideration and they ignore that, with arguably a cost of $70m to tax payers how on earth does bringing a new idea to those same people give you hope of it being enacted?
“Embarrassing politicians is often the only way to effect change and that involves holding their feet to the fire of their past misjudgments or non actions” – but nothing changes.
“when a Government was reviewing this very thing and decided not to do something it was told by the Cabinet Minister in charge that this vessel required serious consideration” – this scenario goes back much further than 3 years.
Stone throwing, mud slinging, humiliation & playing the blame game are all things that have been part & parcel of NZ politics since day dot.
Ultimately hindsight is a great thing – we all become experts after the fact. Surely National is allowed to accept that with the beauty of Hindsight they coulda or shoulda done this & that becayse isn’t that precisely what the Labour party is campaigning on? That they are new and improved, not the same party of old? That they accept they coulda shoulda woulda but vow to do better next time?
If that’s the new rule then it goes both ways.
As for where liability lies, well it is definitely not the govt & in my view (one that has no experience on oil spillage or shipping but plenty on freight) the answer to your questions are:
1) Liability lies with the ship’s owner – assuming of course the Captain was an employee.
To me it is the exact same scenario as BP contracting truck driver x to run petrol from Auckland to Wellington. If driver X crashes & spills petrol everywhere then driver x (or his insurance company) is liable. If driver x does own the truck he is driving but was still a contractor then liability depends on the details of the contract – any good truck owner would make sure they passed that liability onto the driver/contractor. But if driver X is an employee then the truck owner is liable.
The public liability cover for truck drivers is huge – I would imagine that shipping would be even greater so the insurance companies should be able to cover the damage.
2) as stated above it depends on the nature of the contract. If the owner has passed all liability to the operator then the latter is up for the bill.
3) he’s not. There is clearly a lot of confusion on who owns/does what as they are all keen to duck for cover. Not the govts fault.
4) no. the importance of this is only because of the benefit of hindsight. Given Labour did not do anything about this in 9 years it stands to reason that had you still been in government you would have delayed it too.
5) no liability – assuming you mean the company that has contracted the use of the ship & its staff? BP service stations aren’t liable for the actions of the BP truck drivers.
6) they should be liable for the lot – insurance company of liable ship owner or operators should be paying for losses incurred by businesses
7, 8 9 – no idea. Don’t know enough about it.
Re “The penalties available under the Maritime Transport Act are not enough to meet the cost of the clean-up and losses to businesses. ” – that is an understatement.
I find it curious that a ships’s captain is only up for a few months in prison & $10k in fines yet a truck driver it could be years in prison with at least a $20k fine!
Given the volume of DG cargo and the sheer amount of oil that ships have to carry to reach their destination it seems crazy that their fines & penalties are so low. So why are they?
@ Bryce
Given that Mark Gosche diverted $8m out of the fund to cover a potential oil spill of this type and the lack of any other policy to deal with the situation, I don’t think Labour should continue to bring this up in a negative way.
You’re talking through a hole in your head. In 2008 Labour prepared legislation in line with the protocol to the International Convention on the Limitation of Civil Liability for Marine Claims which I think was passed the same year. The 2008 election intervened before it was completed, and the outgoing Labour minister advised the incoming National administration to sign up to it. They didn’t. Had they done so, then the owners (I assume through their insurance company) would have been liable for some $40million extra in compensation to the NZ Govt.
You disagree with everything Labour says and does as a matter of principle. That’s stupid.
Then Labour should be feeling very embarrassed as well given that when they were in government they took the whole issue so seriously that most of the fund to enable a clean up was diverted to elsewhere.
Sadly, many have used “But Labour did it” Or “Labour was worse” as an excuse Rebecca.
At no stage have I suggested in this thread that labour was superior to national in this matter. What I DO suggest is National have the treasury benches NOW and for the last THREE years and DID NOT REQUIRE HINDSIGHT because the Minister in charge TOLD THEM in AUGUST 2010 that a vessel required serious consideration.
Pike River and the CHCHCH Earthquakes weren’t the Government’s “fault” either, how come we all dipped into our pockets to pay for that?
Pike River – mining issue & potential fault of current & past govt re consent. And it’s the right thing to do.
CHCH – natural disaster so the humane thing to do
Both completely separate to the Rena. Doesn’t matter what legislation was or should be in place, ultimately the responsibility lies with the ship’s owner or operator & staff.
To give you a different analogy – say a local pool had delayed getting safety policies in place then one day a child, whose mum who is too busy to chatting to keep an eye on them, falls into the pool and drown. Sure the safety policies are good but ultimately the responsibility for a young child (under the age of eight) is with the parent not the pool.
Same thing with Rena – govt is not responsible. It’s the muppet who drove the ship into the reef and/or his employer that is.
Re August – that was in relation to the gulf issue. There was no way anyone gave the govt advice in anticipation of something like the Rena…the law has been lacking on this issue for years and yet until now, it hasn’t actually been a real issue. The odds were on our side so for ANY busy govt I can understand delay.
Plus just say the govt had taken notice in August 2010 – would we have had the new vessel by now? Doubt it. Look how long it took for the new trains to arrive in the Capital. These things seem to take ages!
Wasn’t Rebecca banned permanently about a year ago?
Rebecca, the shipping company doesnt have unlimited liability, through inaction by Keys government, their legal liability is about half of what it should be. The rest of the money will lumped onto the tax payer ( again).
Surely you know the person who was in charge on the bridge wont pay a cent .
When you run a good government , listen to the experts before a disaster unfold, you are looking after the taxpayers of NZ.
Tax payers pay again. Tax rates are lowered on the rich. Guess that means the people who gain the least from internation shipping (the poor gst paying consumer) have to pay the most for the mistakes made by international shipping. While the rich benificaries of internation shipping get tax breakes?
@ GWW – what are your answers to the above questions?
re “the shipping company doesnt have unlimited liability, through inaction by Keys government, their legal liability is about half of what it should be”
Removal of the $12 million cap wouldn’t have guaranteed a better outcome…there is no such thing as 100% compensation and we are talking about a ship registered in Liberia and further, the cost to date is $4million so a moot point at this stage anyway.
GWW: by disagreeing are you also saying that the govt signing the above convention would have reduced the impact of Rena?
That there would have been less environmental damage, that businesses would have been compensated 100% for any loss – local and those relying on the freight?
That it would have reduced the potential for DG containers opening and causing more environmental damage?
That the oil would have been taken off the ship in 4 days before the weather turned?
@Anne
http://i.stuff.co.nz/environment/rena-crisis/5833206/12m-clean-up-fund-deliberately-wound-down
Is this or is this not true?
As for hating everything about Labour, you have got me seriously wrong but attitudes like yours could change all that!
Too much. Play somewhere else for a month. Trevor
“To give you a different analogy – say a local pool had delayed getting safety policies in place then one day a child, whose mum who is too busy to chatting to keep an eye on them, falls into the pool and drown. Sure the safety policies are good but ultimately the responsibility for a young child (under the age of eight) is with the parent not the pool. ”
Hmmm, so say you decide not to take out insurance, you weigh it up and decide it’s not worth it while others do. Then something happens you are not insured for, should the taxpayer support you?
Say you run a mine, under which you have an obligation (legally) to protect your workers, to keep them safe, and you don’t, should the tax payer pay the bill or you?
You understand it is the legislation, amongst other things which permits the Rena to be in our waters at all? Ergo, Parliament responsibility. How on earth can it not be the “right thing to do” to pay for the cleanup regardless of whether the skipper and his company can?
I think you draw a long and torturous bow, which you are entitled to. Pike River, for example, continued to pay a very high salary to its CEO while not contributing to dead workers families, not contributing to the rescue costs.
“That the oil would have been taken off the ship in 4 days before the weather turned?” Who knows what might have been different if Cabinet had listened to its designated Minister who said a vessel to assist in cleanups was in need of “serious consideration”. They made a decision to NOT make that investment (especially after such a warning as Gulf of Mexico) they need to come out and defend it, plausibly. No one has said WHY they chose not to do that? OR what it would have cost.
It’s hard to avoid drawing a conclusion that they were lining us up for offshore drilling and the less said about potential accidents and spills the better (politically)
Note that Brownlee was not the minister responsible for dealing with marine issues so anything he says in a letter to the Maritime Union is not binding or necessarily well thought through (in a policy sense). Steven Joyce is the only minister with that competence/responsibility. He said they considered it (which is all that Brownless said they would do) and discarded it. The Australian govt has no such vessel and their oil and shipping industry far exceeds our own.
@insider
Do you know if the aussies have the same rules around ‘flag of convenience’ vessels? I suspect this is a major contributing factor.
See our moderation policy. Warning. Clare
insider, are you saying that is how we determine if, and what measures we take to protect our shores, what the Aussies have? Looks like it might have just come back to bite us.
You also know that if the PM hadn’t wanted this vessel, we would have got it.
Interesting that it was the Energy Minister making the point to his caucus, kind of suggests it links to the oil drilling licences.