The Legacy of the Hungry Mile

The Reality of the Waterfront

Peter McKeown

Recently I met a group of visiting Russians who told me: 'You know, the three worst ports in the world for our ships to go to are Sydney, Melbourne, and Genoa.' The problems of Melbourne waterfront are well known, but I am going to talk about what Genoa has done about their problems over the last six months.

Ports in Europe are aware of the opportunities which will arise in 1992, when the Single European Act will abolish all remaining customs and technical barriers to trade between the member states of European Communities. So Genoa has modernised its corporate structure and it has set up a network of international services with container terminals set at the heart of the rail and freeway network. They have built a new container terminal which has a fully computerised system for customs stacking and truck entry. There will be over five kilometres of optical fibres that will transmit full information to the freight forwarders and shipping agents. They will be the first European port linked by satellite to the rest of the world. All these measures will improve their efficiency.

Contrast that to what is happening on Melbourne's waterfront. At time of writing, there is literally nothing happening; they are all on strike. They have been sporadically on strike for the last three weeks, and the export momentum which is fundamental to our survival is being interrupted.

Work practices on the waterfront are an old scandal, but let me tell you about the wheat situation down in Geelong. I went to a ship a couple of weeks ago and was told: 'We are not sailing now.' This was Friday afternoon, so I asked when they were going, thinking it would be tomorrow morning. But it was Tuesday afternoon. I asked what had happened, had they had a cargo of peas or something. Sometimes they get peas instead of wheat into the hold and have to dig them out. But they told me: 'No, no; we don't work over the weekends, and Monday is a Rostered Day Off.' So here is this shipload of wheat left alongside from Friday afternoon to Tuesday afternoon because of inflexibility in management practice. It's not the workers fault that there is an RDO then, but why can't managers roster the RDOs for when there is no ship there?

While we wait for our waterfront to get on with reform what is happening around the world. In Britain lobbying, lead by the Centre of Policy Studies, for the National Dock Labour Scheme has resulted in the freeing up of the workplace on the docks. Private enterprise is now moving in to take advantage of those opportunities. One company, called Highland, has purchased a redundant refinery close to the entrance of the River Thames and it is going to turn it into a container terminal. (There is a redundant oil terminal at Westernport which might be suitable for a similar operation here.)

In Spain, France and Italy they have already introduced schemes similar to the Interstate Shipping Commission Report. New training, job flexibility, and smaller gangs all mean that those European ports are now ready to take advantage of the single European markets after 1992. Canada and the US have signed a freight agreement that will severely test our ability to maintain Victorian exports of dried fruit and aluminium. In Rotterdam there has been a new agreement covering the twenty years after 1993. That agreement will call for the construction of new container terminal that will remain head of the competition through the twenty-first century. The terminal will use state-of-the-art unmanned technology, creating an almost people-less land side operation.

The world's twenty leading container lines carry 70% of the high value cargo moving between Asia, Europe and North America. A lot of statistics came out of this waterfront debate, but one to keep in mind is that 5% of all Australia's exports are carried in these container ships but that that accounts for 55% of the total value of all Australian dollar exports.

The total distribution cost of a manufactured item often accounts for 50% of this total cost and if nothing is done it creeps upwards. Volvo discovered that distribution costs increase in percentage terms as soon as the product became more automated. So they introduced a just-in-time inventory system which cuts costs, providing the components are delivered in the right place at the right time and in the correct quantity. The tragedy for Australian manufacturers who need imported parts is that the unpredictability of our waterfront interrupts that justin-time system. As a consequence, Australian manufacturers must keep higher stock levels than any one else in the world. Then when they have put the parts into something and want to export it there is a Russian roulette situation: will the ship get away on time?, will the wharfies do the work?, and so on.

Loading a given cargo in Australia takes twice as long as it would in European ports. Indeed, International Cargo Handling Co-ordination Association (ICHCA) has found that Australian container terminals are the least efficient of all the ports surveyed throughout OECD countries. In Melbourne and Sydney the exchange rate of containers on and off the ship is about twelve per hour. Ports in Europe handle twenty-four containers per hour. In Asia it is even more: thirty-six per hour.

That's a terrible indictment of what's happened on the waterfront since the seventies when we looked to technology and mechanisation to improve things. We spent a lot of money, made a lot of people redundant and made a lot of people rich, but nothing much has changed. It still takes three and a half months to send that suitcase to your Aunty in England, just as it did in the sixties.

Analysis of the container delays by ICHCA pointed to substantial time losses as a result of award conditions. That was expected, but of greater concern was the fact that 50% of all time lost was put down to mechanical breakdowns. Abuse of machines is common on the waterfront, both because of lack of skill and pure bastardly. I know of workers deliberately damaging a machine because they have been assigned to the 'old' machine, not the 'new' one. Trivial things like that can put a machine back in the workshops.

The workshops are hot beds of strife. In some places there are so many foreign orders, jobs for home called 'foreigners' or 'homers', that there is not time to repair the machinery as well. Over the years the waterside workers have absorbed some tradesmen. At first there was a bit of tension because some of the tradesmen were not too bad, they merely wanted to do a day's work. But it's a hard place to do a day's work because you are considered to be a bit of dogsbody if you do. They want you to be as disruptive and obstructive as possible; that way you are a real little Aussie battler. That is the environment that these decent workers found themselves in and it's little wonder that with management turning a blind eye they quickly said: 'What's the point, we'll be like one of them.'

On the waterfront, a maintenance crew attends every cargo operation, standing by waiting for something to break down. That maintenance crew is made up of one fitter, one electrician, one general hand, two trade assistants and a supervisor; six men standing around waiting for a breakdown. And it breaks down, don't worry about that. There is a machine called a spreader which lifts up containers. A different size spreader is fitted for a 20ft container then changed for a 40ft container. This is a slow process, so the engineers developed an hydraulic system that would do the job much more quickly. What happens to these state-of-the-art hydraulic arms? They get broken and spend a lot of time getting repaired. Where do they get repaired? In the work shops where they are all doing the foreign orders. So the maintenance crews are still on the waterfront because the workers are breaking the technological advances that have been introduced.

The Interstate Shipping Commission Report called for change. They are suggesting that over a three year period we change from the present national employment scheme to enterprise based employment. Three years is far too long. It has got to be done much more quickly than that. The waterside workers should withdraw coverage in ports where integrated workforces are established and stevedores should continue to operate under new enterprise agreements. What is happening around the world is that machinery is making things better, but not in Australia because the workers are breaking the machinery as quickly as it's being developed. But any of the ships that come to Melbourne have their own lifting gear, their own cranes, and we may not be able to match the exchange rates in Europe or Asia with cranes but you can certainly match and usually better the Australian rate of 12 containers per hour using the existing ship's gear. Ship-board cranes have significantly improved and a minimum cycle of 25 loads per hour is commonly claimed.

Why must a ship that comes to Melbourne use those Port of Melbourne shore side container cranes and waterside labour? Why have all that cost, all that infrastructure, all the maintenance, all the bother and frustration, when the ship's own gear can move the cargo twice as fast and maybe even use their own fully paid crew members who are just standing around anyway? Why have the wharves, why don't the boxes just go straight off the ship onto the back of the Coles Myer truck and out to depots?

There is a cultural environment developed on the waterfront. There is a reluctance to work. Management is turning a blind eye. The criminal elements on the waterfront break down all codes of discipline; don't ever be frightened to say that, the crims on the waterfront are stopping the reform. There is a stop-start style of work; no momentum is generated.

The control of the group is maintained by the unions. Management left a vacuum and the unions have filled it. Nineteenth century class myths are maintained. There is an enforceable code of silence. It is enforceable; l know stories of men who may have been murdered on the waterfront as a result of that code of silence. And there is the business of 'don't break down the conditions', 'don't work an extra five minutes', don't do this don't do that. The Unions have protected the dodgers, the drunks and the bludgers. Managers have not been backed up. Discipline is lax, morale is poor, there is high absenteeism, there is sickness. We all know what that means; there is a terminal condition on the waterfront.

Whose responsibility is it to fix it up? All the industries that use the waterfront have that obligation: exporters, transport companies, and reluctantly I would say the Government. I am not a believer of government intervention, but they are responsible for the maintenance of law and order and they pull the basic levers of the economy.

What should be done? The Interstate Shipping Commission strategy is well known: basically, they want to introduce more competition. What disappoints me most is having waited so long for the Report and read all the words and been involved in some of the discussions, and at the end of it all the government has formed WIRA, another committee. Ralph Wlllis is running backward and forward from the ACTU like an errand boy. John Button looks like he has put it all in the 'too hard' basket. One of the tragedies for us and for Australia is that the Government is being forced to face this critical economic test when its senior warriors are tired and shell shocked. Unless we really keep the pressure on, nothing will change. I suppose you could say, it's a gloomy outlook but we must keep the pressure up because we know the problems and we know the solutions.

Why HR Nicholls?

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