Editorial: The Port of Newcastle and competition laws

IF there is one thing that Coalition governments love to promote, it’s the concept of competition in the marketplace as a bedrock belief. History, however, shows that reality and rhetoric are often very different things.

Botany cranes and containers

Botany cranes and containers

So it has been with the Coalition state government’s privatisation of Port Botany, Port Kembla and the Port of Newcastle. A Newcastle container terminal had been tossed around in various guises since the late 1990s, when BHP proposed it as the best use of its Mayfield river-front site once the steelworks was demolished. The government-owned port corporation was still looking for a prospective operator when the Coalition took power in 2011, but as we now know, secret conditions were attached to the privatisations that effectively cruelled Newcastle’s chances of building a container terminal. The government finally confirmed the situation in July 2016, when the Newcastle Herald obtained a copy of a confidential “port commitment” document, setting out the constraints on Newcastle.

But well before then, the federal competition regulator, the Australian Competition and Consumer Commission, had signalled its interest in the issue, saying it was concerned that the port privatisations “could lessen the prospect of competitive port services”.

But even if the ACCC is concerned about something, it can only act if there is a breach of the relevant legislation. Until now, the regulator has said it could not act because the government was not, apparently, carrying on a business when it privatised the port. This apparently meant that the competition act did not apply, and so the ACCC has sat on the sidelines, despite its obvious qualms.

It is important the ACCC get to the bottom of this, because if a container terminal truly is a viable proposition for Newcastle, it should be allowed to compete on its merits. We should not be told to stick to shipping coal, which is what the government has said before.

A government that prides itself on backing the private sector should not be striking secret deals that are plainly anti-competitive in spirit and practice, regardless of their legal niceties. If the Port of Newcastle has the ability to bring a container terminal to fruition, it should be allowed to do so, within the usual planning restraints. The government did this region a grave disservice when it attached the financial handcuffs that shackle our port for almost a century to come.

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