The Maritime Union of New Zealand (MUNZ) is calling on the Prime Minister to address the inter-island ferries deal during his visit to South Korea after what it describes as a major misstep by the Finance Minister in cancelling the project.
Prime Minister Christopher Luxon is visiting South Korea and Malaysia this week, accompanied by a senior business delegation.
The cancellation of the ferry replacement deal, which had been under negotiations for eight months between KiwiRail and Korean shipbuilder Hyundai Mipo Dockyard, is expected to cost the taxpayer up to a half a billion dollars, the union says. This is on top of another half a billion dollars of sunk costs in the abandoned Inter-Island Resilient Connection (iReX) project.
MUNZ national secretary Carl Findlay expressed frustration over the delays and says it’s “unacceptable” that the project remains in limbo.
“It is astounding that more than a half a year after the Finance Minister cancelled this vital project there has been no resolution.”
Findlay criticised the Government’s lack of a backup plan for the country’s only rail-freight service on Cook Strait.
“It is bad enough that the Government clearly had no plan B for the only rail-freight service we have on Cook Strait – the fact that we are still waiting for final cancellation or renegotiation of this deal is madness,” he says.
He also pointed to the broader implications of the situation, highlighting the risk to relations with South Korea.
“Nicola Willis’ ferry fiasco isn’t just costing us money, it has put the kibosh on the biggest economic deal between South Korea and New Zealand in years, and risks souring relations between our countries,” Findlay says.
Findlay is urging the Prime Minister to leverage his international business experience to resolve the issue swiftly.
“We have to get on with replacing the ferries we have. At best KiwiRail will be able to eke out another five years of service from them; it can take longer than that to design and build new ships. If the Government doesn’t settle this cancellation soon, or renegotiate to get Hyundai to build new ferries, we will run out of time.
“That’s a huge and urgent threat to freight customers, our economy, and our international reputation.
“No matter what happens, the reckless decision to cancel the build contract, just days before the steel was to be cut for the hulls, has put New Zealand in a terrible position.
“We need the Prime Minister to call time on the situation, front up on the cost his government has put on us and work to get a contract struck for publicly owned, rail-enabled ferries immediately,” Findlay says.
