CTA Review Report comes to same conclusion as AIMS study on Port of Halifax
[HALIFAX] — Vision and Balance, the final report of the Canada Transportation Act Review that was released this week has reaffirmed the conclusions contained in an AIMS paper released in June, say the paper’s authors. That paper, entitled “Port-Ability: A Private Sector Strategy for the Port of Halifax”, concluded that only a private-sector approach to port governance would allow Halifax to achieve its potential as a gateway to North America. “Port-Ability” demonstrated that the global trend towards private sector ownership, or at least management, of ports, and the accountability and incentives that come from that, has been the driving force behind most of the global port success stories of recent years.
The CTA review panel has agreed wholeheartedly with this conclusion. As their report states, “…most economists agree that the private for-profit model has important advantages over the alternatives of public production and not-for-profit production in the case of purely commercial services.” The report goes on to say that, “it may now be time to consider developing a long-term strategy to realize the full benefits of market-oriented service provision.”
“We could not agree more with the conclusion of the CTA review panel on the need for a much greater role for the private sector,” says Brian Lee Crowley, President of AIMS and, along with Charles Cirtwill and James Frost, a co-author of “Port-Ability”. “As the CTA review points out, a for-profit model offers substantial benefits over public or not-for-profit models – greater efficiency, minimized costs, improved customer service. A for-profit model also offers the best solution for ports like Halifax which will require major private investment in order to achieve and maintain a competitive position vis-a-vis the US.”
The CTA review panel believes that a shift to a for-profit model will require time and careful planning. In the meantime, it has suggested several immediate ways to address many of the limitations of Canada’s public port authority structures which were highlighted in “Port-Ability”: access to capital, excessive governmental control, lack of market incentives for service improvements and cost or price reductions.
The AIMS authors are encouraged. “The faster we can move to a more market-based approach to management and accountability, the swifter we will be able to attract the capital needed to keep ports like Halifax competitive on the global stage. “Port-Ability” laid out the right strategy, which the review panel has now confirmed,” notes Crowley.
But, the incremental approach recommended by the review panel may still be too slow for Halifax’s needs. According to Cirtwill, “The danger here is that the recommendations of the CTA review are not binding. It is unclear when, if at all, any of these proposed changes will be made. The AIMS paper purposely set out a private-sector driven strategy for the development of the port that would not require any changes to legislation or the status of the port authority in the short term. Halifax has to act now to take advantage of the brief opportunity offered by technological change and temporary capacity constraints at competitor ports such as New York/New Jersey.”
The CTA Review Panel Report, “Vision and Balance”, is available on the Transport Canada website at: www.reviewcta-examenltc.gc.ca/english/pages/whatsnew.htm
For further information, contact:
Charles Cirtwill, (902)-429-1143
Brian Lee Crowley, President, AIMS, 902-499-1998
James Frost, (902)-429-3121