Port war: Baird government’s “strictly confidential” agreement protects Botany container terminal against Newcastle competition

THE state government has finally confirmed it struck a “strictly confidential” agreement with the private operator of Port Botany and Port Kembla to compensate it against any competing container terminal in Newcastle.

The government has repeatedly denied or disputed the existence of such an agreement, which has been the subject of more than 100 separate questions to parliament over the past two years.

Treasurer Gladys Berejiklian was still saying on Thursday that there was no “legislated container cap at the Port of Newcastle”, and that there was nothing to “prohibit” one in the future.

But Ms Berejiklian did not question the 11-page “Port Commitment” document obtained by the Newcastle Herald, which explains how the operator of any future Newcastle container terminal would have to pay compensation to the government, which would pass the money on to the operator of Port Botany and Port Kembla.

The commitment document contains a formula for calculating the compensation, which centres on the average cost of moving containers through Botany.

Based on reported Botany charges of about $120 for a full container and $75 for an empty one, Newcastle would have to pay Botany about $1 million for every typical container ship that passed through the northern port.

Opposition leader Luke Foley – who was already critical of the port privatisations – said it was “frankly an outrage” that the government had used a confidental agreement to artificially restrain Newcastle’s port growth.

“The government needs to fess up, come clean and stop lying through its teeth,” Mr Foley said.

“Labor has questioned Ms Berejiklian on this very issue in the Parliament. The Herald has been relentless in its pursuit for answers. Even when presented with the smoking gun, Mr Baird’s Government still doesn’t have the guts to be upfront with people in the Hunter.”

Newcastle MP Tim Crakanthorp said he had asked 37 questions in parliament on the subject, “only only to be given non-answers, re-directions and contradictory responses”.

“The Coalition has continually refused to disclose the details of any anti-competitive arrangements,” Mr Crakanthorp said. “In light of this document beginning released it is time the government set the record straight.”

Former BHP public affairs manager Greg Cameron – who helped run the original plan to put a container terminal on the former steelworks site after the steelworks shut in 1999, said he was stunned at the content of the agreement revealed by the Herald.

“This charge does not appear in any NSW government policy document, planning instrument, freight plan, transport strategy, or budget,” Mr Cameron said.

The document, available on the Herald website, confirms that Newcastle is allowed to move 30,000 containers a year – increasing by 6 per cent annually – before it must pay compensation.

Port Botany’s handles about 2 million containers a year and the legislated limit on its expansion was removed in 2012.

The Botany and Kembla lessee, NSW Ports, and the Newcastle operator, Port of Newcastle, both referred lease questions to the government. But the Newcastle operator said it was “open-minded” on the future of the former steelworks site.


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