Monday, February 26, 2024

It’s Groundhog Day again at the ports

Recent stories

Yet again another strike on the wharfs ends in a cave in by the stevedores.

Last week DP World, which is owned by the Dubai Royal Family, agreed to increase wages by 25 per cent over the next four years to end a rolling series of stoppages that has gone on for months.

The wage increases work out about double the predicted inflation rate with almost no productivity trade offs.

Add to that a $2000 sign on bonus for workers who are already signed on, and extra overtime to clear the backlog of 50,220 containers waiting to be either loaded or unloaded at DP World in Melbourne, Sydney, Brisbane and Fremantle, which the company said will take up to six weeks to recover.

It’s a win win for the unions and lose lose for Australia.

As a result of the strike, one fifth of all container ships from China cancelled their January services to Australia because of the ongoing industrial dispute which has impacted businesses waiting for chemicals, equipment and parts.

Unfortunately, the Arab owners found out the hard way that this is not the United Arab Emirates where there is a queue of foreign workers standing at the gate ready to replace any worker that goes on strike.

This is Australia, the lucky country, or more commonly known today as the lazy country, a country that seems to prefer paralysis to productivity.

A country that elects pro union governments and legislates complex industrial relations (IR) laws that give vast powers to unions, while ignoring the needs of the economy, in an era when unions are a thing of the past.

Back in the glory days of the union movement, when they really did have the power to call mass stoppages, people from that era will recall the  Painters and Dockers running endless strikes stopping the export of the wealth that made Australia lucky. 

After decades of this, farmers decided to push back, which in part led to the establishment of the National Farmers’ Federation as a powerful national body capable of taking them on.

We fought them on the wharves and, while not winning every stoush, we at least slowed them down.

Unfortunately, farmers can’t respond today as we did back then by heading down to the wharf and taking over the job ourselves, nor do we have a tough union tamer like former Minister for Industrial Relations, Peter Reith nor a business owner like Chris Corrigan who had the courage and cash to stand up to them.

But it’s been many a year since those champions were in the ring, with the last big fight now a full quarter of a century ago.

While some of the productivity gains linger on within the Patrick Terminals, DP Ports struggles to be as efficient as they have allowed the unions to dictate how the ports set their rosters..

Today Patrick’s is far more productive than their rival DP World which owns the inefficient Fremantle facility.

The company got there by agreeing to big pay rises in exchange for introducing new technology and removing clauses in its enterprise agreement that gave unions a say in rostering.

This delivered a productivity offset which has left their rival DP World behind and allowed them to pay more. As a result, everyone is a winner. Workers get paid more, importers and exports have slightly lower costs and the only whingers are the unions which see their membership numbers shrinking.

But, unfortunately, the latest strike action by DP World has not led to big productivity gains for their 6 per cent pay rise on average a year.

In the latest decision, DP World’s workers are now being paid close to that of Patrick’s but are less productive.

The union wanted an 8 per cent increase and the hard bartering high paid management only beat them down to 6 per cent with few trade offs.

Problem now is the billion dollar DP business is not throwing off big enough profits to fund the upgrades and payouts needed to drive up productivity.

Not that the unions or the Government care.

This is a rolling disaster for the agricultural sector which, unlike much of the mining, petroleum and service sector, relies heavily on the flow of containers across the ports.

Many farmers are already joining the dots of the risk posed by the wharf to their business now routinely pre-order and have delivered their seasonal requirements months before the start of the season.

So much for the claims by the Minister for Agriculture that we can simply swap from live exports to chilled containerised exports and everyone will be a winner.

The government’s only contribution during the strike was that their hard left Minister for Industrial Relations, Tony Burke, whose solution to the strike was to simply lift Australian stevedoring prices and recoup the higher labour costs from importers and exporters.

Welcome back to the thinking of the 1970s.


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