Skip to main content
Normal View

Joint Committee on Transport, Tourism and Sport debate -
Wednesday, 20 Sep 2017

Drogheda Port Company: Discussion with Chairman Designate

Before I call our next witness, may I remind members and witnesses to turn off their mobile phones. I welcome Dr. Joseph Hiney.

I draw the attention of the witness to the fact that, by virtue of section 17(2)(l) of the Defamation Act 2009, witnesses are protected by absolute privilege in respect of their evidence to the committee. However, if they are directed by the committee to cease giving evidence on a particular matter and they continue to so do, they are entitled thereafter only to a qualified privilege in respect of their evidence. They are directed that only evidence connected with the subject matter of these proceedings is to be given and they are asked to respect the parliamentary practice to the effect that, where possible, they should not criticise or make charges against any person, persons or entity by name or in such a way as to make him, her or it identifiable.

Members are reminded of the long-standing parliamentary practice to the effect that they should not comment on, criticise or make charges against a person outside the House or an official either by name or in such a way as to make him or her identifiable.

I now invite Dr. Joseph Hiney, chairperson designate of Drogheda Port Company, to make his opening presentation.

Dr. Joseph Hiney

I thank the Chairman and members of the Joint Committee on Transport, Tourism and Sport for inviting me here today. I will start, as requested, by introducing myself and setting out my background as it relates to the role of chairman of Drogheda Port Company.

I live within the hinterland of the port in County Meath, although a product of Dublin 12 and an alumnus of Drimnagh Castle CBS. My first permanent job was in Dublin Port and Docks Board in 1980 and I have been in or associated with the port industry ever since. I spent 30 years in what is now Dublin Port Company in a variety of roles including head of internal audit and later finance manager. One of the more interesting projects I had the good fortune to be involved with was an Irish Aid funded training project in partnership with other Irish ports and with the United Nations Conference for Trade and Development, UNCTAD.

I left Dublin Port Company in 2010 and took up a scholarship in a doctoral programme in the School of Law and Government in Dublin City University. My research interests were in the field of comparative political economy and my case work focused on policy making across international container ports. I completed my PhD in 2014 and continued to work with UNCTAD as an instructor on its port manager training programme and as a consultant in their port performance benchmarking project across their member ports. This opportunity to engage with port managers across many cultural, historical, political and economic contexts gave me a basis to examine critically how we in Ireland approach the port sector as managers and policy makers. This comparative information remains a key resource for me in facing into the challenges for Drogheda Port and Harbour in the coming years.

I will use my remaining time to set out my thoughts on the role of chairman in Drogheda Port Company. My experience with Drogheda Port Company since 2013 has been a very positive one. The economic downturn of 2008 had a significant impact on the port finances and I give credit here to the staff and management of the company who took radical measures to survive as a commercial entity. The fruits of those actions have matured and the business is now trading at prudent profit levels consistent with continuous investment in port infrastructure. Comparing the financial performance with similar ports internationally, it stands quite well. While the operating margin is on an upward trend on a turnover of €3.8 million, it is still below the average for its peers and this reflects the recovery position of the business.

The question of economic sustainability is critical to regional ports. The commercial port is at an environmentally important location 7 km west of the River Boyne entrance. It is a port with an annual volume of more than 1.2 million tonnes trading within the Drogheda Harbour. To do so in a manner that is sensitive to the environment and the community we work in requires imagination and consultation. The port supports around 1,000 jobs and is home to several industries that rely on the port for raw material imports and for their exports. Therefore, balanced and considered planning is required in how the commercial port evolves. My personal goal here is to engage actively in the consultative process we will launch shortly to develop a sustainable master plan. This plan will set out the long-term vision for the development of the commercial port within Drogheda Harbour, including its relationship with the town. I hope that this two-way communication will stand to all of us associated with the region in the years ahead.

One of the early priorities during my time on the board was the transition from State ownership to local authority ownership. I participated in that process as chairman of an ad hoc committee. The company has engaged with the Department and the council management to undertake the due diligence required for an effective share transfer. We have finished our work and await the completion of the necessary transfer documentation. We will continue to work constructively with the current and future shareholders to bring this matter to an early conclusion. This matter is not in our hands at present as there are other ports in our category that are also working through the ports’ policy impacts. Good governance is a topic I have worked on with colleagues in many international settings. My goal is to support the continued efforts by the board and management to function in a manner appropriate to a State-owned enterprise, no matter the level of the State-owning institution.

I am honoured to sit here in this setting as chairman designate of Drogheda Port Company. I will do my utmost to meet the obligations of the role and to make the best of the experiences I have of the industry internationally. I thank the committee for its time and hope my comments have helped it. I am more than willing to answer any questions the committee may have.

I thank Dr. Hiney. I presume Deputy Munster, as a Drogheda Deputy, would like to ask some questions.

I thank Dr. Hiney for his report. I have a number of questions. Many locals in Drogheda have expressed a concern about the fact that Drogheda Port has the docklands site up for sale for €1.5 million. They are concerned about how secure the future is for Drogheda Port. Could Dr. Hiney give a brief outline of that? There were also questions asked about the moneys from the sale. Where will they go? Will some of the moneys from the sale be reinvested in development locally? Is there a possibility the local authorities will get some of the moneys from the sale? Perhaps Dr. Hiney will answer those questions first and then I will ask some more.

Dr. Joseph Hiney

If I understand the question correctly, the Deputy is referring to a warehousing site on the town quays on the north side.

Dr. Joseph Hiney

That is not for sale by the port company. I am not a lawyer but I will do the best I can with the legal interpretation. It is for sale by the landlord. They have been there for a while and under Irish landlord and tenant legislation they have rights to sell on. The conditions within that lease would refer to port-related activity unless otherwise negotiated. We await information on who the new owners will be if the sale is successful. We would like to see it redeveloped in an appropriate manner.

Dealing with a very general point in terms of redeveloping the town, we do not have any principled view that the port has to be there in the very long term. The trend worldwide is always to move closer to the river mouth. Where we go is the first obvious question. How much it will cost is the second. That leads me on to the money question. As we are not participants in the sale, we do not have access to those funds. If anything, it would be an investment by the port company if we managed to have some role in its future.

Dr. Hiney is probably aware of a bone of contention with Drogheda folk which is the car parking. The port operates the car parking system on the north quay. Are there any plans to hand that section of car parking over to the local authority in order to regularise the car parking regime in Drogheda? It has always been a bone of contention. Are there plans to do that?

Dr. Joseph Hiney

I cannot comment on the specifics because we are not quite starting with a blank page but we want to start a consultative process. That certainly is one item in the process of where we go next in terms of developing not just the town aspect of the port activity but further towards the mouth of the river into the commercial port activity. As long as those lands are within the port company estate we have an obligation to make sure - "regulate" is probably too strong a word - those parking spaces in that land are properly insured and maintained and that parking on it is regulated consistent with broader town regulations. The reason we engage actively is it costs money to keep those roads and that area in good condition. That said, nothing is pre-determined in a consultative process. We approach any consultative process with an open mind. If there is a good idea and a good proposition, then we certainly will not be found wanting in working with the town to do a good job there.

Dr. Hiney said that part of the paid parking was to keep up the maintenance of the roads but if truth be told, and I am not directing this comment at Dr. Hiney personally, it is quite the opposite. The north quay and the north strand have been allowed by the port to fall into a desperate state of disrepair. Has Dr. Hiney any plans to clean up the area given we have the fleadh next year? For the past number of years, community volunteers have been doing that work as opposed to the port being active in it. It can be very frustrating for people in Drogheda. Dr. Hiney knows what I am talking about. It is an issue particularly on the north strand and sections of the north quay. It has been very much neglected by the port.

Dr. Joseph Hiney

There are two parties involved in working on those quays. It was quite successful during the summer when we had the vessels in the port during the festival. The fleadh is a much bigger proposition. I am aware that management and council officials are actively engaged on how to prepare for it. I certainly will do my best as chairman to keep it on the agenda and ensure we put our best foot forward because we are part of the community in Drogheda. I cannot speak to specifics of the budgets that will come out of that conversation but we have had great success with the projects we have done jointly with the council to date, including the recent opening of the small pontoon for leisure vessels and so on coming into the port. We want to continue along that path and improve the environs in Drogheda town.

It comes back to the fundamental issue of where ports go from here. We have to be very careful when we levy money on shipping that it covers the costs of servicing that shipping. They certainly are not keen on subsidising investments in the ports so, under European legislation, we have to ring-fence pots of money, as it were, to ensure there is no cross-subsidisation. We work hard on that particular issue.

I can understand that. I accept Dr. Hiney stated he wants to do it but to date he has not given a commitment or been proactive in carrying out maintenance given the state of disrepair that the port is in, despite it being raised on numerous occasions. I would have hoped he would have given some commitment at this stage regarding the area directly adjacent. He knows the reasons the area has fallen into a state of disrepair and it is partly to do with port traffic and all of that.

Dr. Joseph Hiney

I can give Deputy Munster my personal commitment that when I take up my position as chair in the next few weeks - I am sorry but I do not want to pre-empt where this conversation goes - all other things being equal, the consultative process is the first thing on the desk to engage with, and I will make it my business to engage with it and give that conversation some life.

That is fair enough. I thank Dr. Hiney. The port and the council went 50:50 on the cost of the jetty on the Boyne, which was €155,000. I wish to raise an issue that could possibly be incorporated into the consultation process. I refer to the promotion of ecotourism along the Boyne in conjunction with Louth County Council. I do not say Drogheda Port must go the whole hog on it by itself. Given the Boyne's nature and history and the opportunities that exist to develop tourism, in particular ecotourism, would Dr. Hiney consider making a commitment or reference to that in the consultation? One example would be a birdwatch hide along the estuary. There are protected species along the Boyne and the river has been pretty much neglected over the years. It would be something the port could give back to the community if it were to invest in and develop tourism along the estuary.

Dr. Joseph Hiney

Each project on its own is a small one but each year there is a range of projects where the port is very much pursuing that line. Ports nowadays are very keen to be good corporate citizens. I worked recently with a team in the Philippines on ports which focused on the relationship between the environment and the community, in particular in the context of cruise and tourism traffic. It is clear that there are opportunities now as cruise and water-based tourism grows internationally. It is growing beyond the stereotypical image we have of the rich cruise passenger coming on the very large cruise ship from the United States or wherever else. There is now a growing trend towards ecotourism and adventure-based tourism and the River Boyne is an opportunity but it cannot be exploited. What one also finds with ports, cruises and tourism is that the ports are a part of the picture. If it was containers, the port would be driving the agenda but with tourism and cruise passengers, for example, it is very much a case of working with the local community because the port itself is one aspect of the business. Cork is a very successful operator when it comes to cruise tourism in Cobh. I was working there recently on that and it is particularly interesting because as soon as the people come off the vessel local people take it from there and bring them far and wide, so that equation must be in place in Louth and Meath as well to meet the demands of the tourists who could come in.

I will come back to Deputy Munster on the specific proposal she has in terms of birdwatching. I will find out more and come back to her.

That is fair enough. I thank Dr. Hiney.

Deputy O'Keeffe wants to get in as well.

I will finish up in two minutes.

There is no issue. There is nobody rushing Deputy Munster. I just want Deputy O'Keeffe to know he has not been forgotten.

I presume once the consultation kicks off that we will be invited to contribute.

Dr. Joseph Hiney

I hope the Deputy will take part in the consultation. There are two representatives here with a local interest.

On what was said about the port not working on its own and that community involvement is required to develop tourism attractions, would Drogheda Port seek to formalise a link between the board of the port and a member from the local authority or even in another forum? Will Dr. Hiney give a commitment to have one or two members of a local authority on the board so that there can be the kind of engagement he said he would like to see?

Dr. Joseph Hiney

First of all, I do not believe I am in a position to give such a commitment from the point of view of the Harbours Act, as it sets out particular conditions in terms of who can be on the board. Perhaps I have misunderstood the Deputy's question. Anything is possible in terms of more informal consultation. Certainly, stage one of our process is to work out not just who we need to communicate with but how. One can hold workshops and nice evenings in hotels but the question is how we can hold productive meetings in a real and pragmatic fashion. That is where the challenge is. A huge part of it is listening. One needs to create a forum in a structured manner in order to hear the different views. It has been done quite successfully by other ports in this country. In the context of its development, Dublin Port held quite an extensive and wide-ranging consultation. It is much larger than Drogheda and has greater resources to do that but in our own way we want to do the same thing. We want to communicate. The shares will transfer from the Minister to Louth County Council at some point and the shareholder under the Act is the chief executive of Louth County Council. We are working with the council on how that governance structure will evolve in terms of liaison and communication. We are proscribed in what we can do under harbour legislation so some of those questions relate to Louth County Council and how it will do it.

However, Dr. Hiney would not be against such a proposal if it was feasible?

Dr. Joseph Hiney

I do not want to get into the detail but under the 1996 Act, similar to legislation around the world, the approach has been to remove local representatives from commercial boards for a variety of reasons, one of which is conflicts of interest.

I think the conflicts of interest are more likely to rest with business people.

I refer to conflicts of interest.

Local representatives are the public representatives for the area.

Dr. Joseph Hiney

I do not disagree. There has to be a mechanism.

We would both disagree profoundly with Dr. Hiney in that regard. I say that respectfully.

Dr. Joseph Hiney

That is understood.

I refer to the point Deputy Munster is making. I hear everything Dr. Hiney said and I welcome his personal commitment to engage fully with us. I have no doubt about that at all. The question is the relationship between the local authority, as it will now be, and the port authority and the issue of democratic accountability to that forum either by way of membership or consultation. I do not see anything amiss with what Dr. Hiney seems to be saying, namely, as that consultation goes on the members of the council will surely have a view on what they would like the manager to do and the manager is accountable to the elected representatives.

It is about cohesion, co-operation and accountability. Given Dr. Hiney's response to questions and from his statement I do not see why he would not be in favour of something like that.

Dr. Joseph Hiney

We certainly need a mechanism. This is new. The Department has said Drogheda Port Company will move to the control and ownership of Louth County Council. I am advised in the last week that progress has been made. I do not have a date for that because there are other ports in the country that have a different view as to how the issue should be progressed.

It is a good thing because it is bringing ports back to local accountability through a system that is accountable in itself to public representatives.

I think that covers that issue. Deputy O'Keeffe is next.

I welcome Dr. Hiney here today. Obviously his appointment is a fait accompli at this stage. What process did he go through to be appointed? Was the position advertised or did he get a phone call from a departmental official or from the Minister? How did his appointment come about? Was there due process, which is relevant given all of the talk about board appointments at the moment?

Dr. Joseph Hiney

Indeed, I understand the question. I was already on the board of directors. We have a small board of fewer than eight directors. In the next week, we should be restored to five. We have always felt that the board should number no more than six because it is a small company. It does not need eight directors. We voluntarily kept the fees and the numbers down to reflect the size of the business. Under the legislation and the rules the Minister has the option to reappoint or to appoint a chair from among the current directors. The process was that I was appointed from among the current directors. I came to be a director in the first place by submitting my curriculum vitae to Stateboards.ie in response to an advertisement. On that occasion, I received a call from a previous Minister and was appointed in March 2013 to the board.

We very much need people like Mr. Hiney coming in and applying through that process. It is very welcome that he brings all of his skills to the board.

I am not questioning that, Chairman.

I know the Deputy is not criticising Dr. Hiney.

I have one more question for Dr. Hiney. In the future, the idea is to expand the business, with a target of 1.2 million tonnes of a turnover to report. However, Brexit brings its own fears and we do not know what will happen. Irrespective of what happens with Brexit, can Dr. Hiney see the business growing? In terms of what goes through the port, how much is destined for Britain, mainland Europe and countries outside the EU? What are the dependency levels in that regard? Obviously the big issue is that if we end up with a hard Brexit, that will bring extra work in terms of customs and so forth.

Dr. Joseph Hiney

I am as perplexed by Brexit as anyone else in terms of where it will end up and how it will work. I have no particular wisdom on the matter. If there is a hard border then there certainly will be extra steps in the process of moving cargo in and out. Our niche market is in dry bulk imports and some dry bulk exports. This involves particular ships coming in with one load, some from the UK but mostly from northern Europe. I am talking here about transhipments of animal feed and so on, into Ireland, to supply the agrifood business in the north east of the country. One aspect of Brexit that would be a concern that I can identify rather than just speculate on is based on the fact that we compete with a small port on the other side of the Border - hard or soft, virtual or otherwise - in Warrenpoint. The association representing UK ports is lobbying for special status for ports because of Brexit to enable them to deal with the transactional issues that would arise in a border scenario. They already have competitive advantages in terms of their planning rules and the ability of the state to invest in their ports. We would be concerned that Drogheda Port Company will suffer a further competitive disadvantage.

As the Deputy rightly says, it is a small to medium sized enterprise. We expect to grow. If one looks at container ports like Dublin and Cork, one will see sustained growth because they reflect merchandise goods moving in and out of the country. We deal with niche markets in terms of dry bulk, which has its own different dynamic and is a function, for example, of the agricultural industry and the demand in that sector. We also have cement exports and other ore-type exports that function well. It is very hard to tell what will happen. One can see some of the players in the market, not necessarily to do with Drogheda Port, making moves to have warehousing facilities and legal entities in both the UK and Ireland. Presumably they are hedging their risk and preparing for whatever happens. We are in a high exporting and high trading economy. We need to be able to move our goods and people in and out of the country efficiently.

Is Dr. Hiney saying that existing customers are already making-----

Dr. Joseph Hiney

I have an anecdote for the Deputy. A former customs agent who is in his 70s was making the point to me that most of those with the expertise are of that vintage. He asked where the expertise would come from in terms of the various forms, duty codes and so on. I am not sure where these virtual, soft or other variants of Brexit are coming from. I really do not see it working in practical terms. Like everyone else, we keep a very active eye on what is happening where we can. We attend, we listen, we read and talk to people and at this stage I am not sure what else we can do. We await the lead which will come from the political process.

Is Drogheda port a major importer or exporter?

Dr. Joseph Hiney

It imports and exports different products. The ratio of imports to exports varies because it is a small port. In the larger ports, swings and roundabouts apply, in that they can lose one and gain another. Generally it evens out and they have a steady mix of imports and exports. In Drogheda, however, it can fluctuate quite a lot. It tends to be in the 60:40, 40:60 range.

I have a few questions, if I may. I welcome Dr. Hiney's knowledge and experience which is valuable to the port. Not so long ago, there was talk of an expansion of the port out through Gormanston. I do not know if Dr. Hiney was familiar with that plan. Dr. Hiney referred to waiting for leadership from the political system but we actually changed legislation in this House. We voted to give the Drogheda Port Company the capacity not just to expand in Drogheda but wherever it wanted to go, even outside the State. There were big plans in that regard and I am wondering about the status of those plans.

Dr. Joseph Hiney

In relation to the legislation, I was with Dublin Port Company at that time and had an active interest in the international dimension of the legislation. My eyes were completely focused on that dimension at the time. Since I came on board in the Drogheda Port Company in 2013, the Gormanston project has not featured at all. My view is that it went with the Celtic tiger in that the demand is not there, to my knowledge, for a development of that scale.

When he spoke earlier on, Dr. Hiney referred to moving the port to the mouth of the river. There was a lot of controversy over that in the past which he may not be aware of; there was huge opposition to that proposal.

Dr. Joseph Hiney

Out to the harbour or inside the harbour?

No, on the river. Sorry, towards the sea. I do not think that would be particularly welcomed were it to be proposed again. I am just acknowledging that Dr. Hiney wants to change. The fact that the river can only take boats of a particular draft means that Drogheda is very much a niche port. I welcome its success so far but am interested in the plans for the future.

Dr. Joseph Hiney

That is the point. We must engage with the consultation process. We cannot just say, "Here's our plan, take it or leave it". That is not what we want to do. We have ideas and have explored scenarios but that is all that they are at this point. The Chairman is correct to point out that I said in my opening remarks that it is a sensitive and beautiful part of the country. We cannot just move the port anywhere. If we want to expand, for example, what happens on Tom Roe's Point? Even expanding by a few metres on either side is problematic. If we want to get larger vessels in, we have to talk about training walls and deepening the entrance to the harbour. These are all issues that need to be addressed if we are to accommodate the traffic that is natural to the region. One of the features of the dry bulk logistics chain is that one wants to bring the cargo as close as possible to its home. One could bring a container into Dublin and drive it to Donegal or Kerry.

However, the relative cost of dry bulk for road transport means that one wants to be closer to one's destination or origin. Drogheda can fill that niche market efficiently and in an environmentally compliant way.

We do not have a view. It is about first looking at how we can use the existing sites more intensively. It is responding to the demands in terms of the town quays and asking what we can do better. Could we move and rehabilitate work with the local authority to do more in the town quays? Theoretically, the answer is "Yes", but that raises the obvious question of where we put that trade and those assets.

One of the proposals some years ago was that there would be a new link road coming down near Tom Roe's Point that would link to the northern cross route and then link across a bridge on a new road across the Boyne. I do not know the position on that now.

Dr. Joseph Hiney

To my uncertain knowledge it is not in the capital plans as things stand.

It is not in the capital plans but-----

Dr. Joseph Hiney

That is the northern access route.

The port access route.

It was a proposal long before even Deputy Munster was on the council, and I do not mean to be rude in saying that.

It was a part of the northern revised plan

The idea was that there would be a new bridge to the east of Drogheda that would allow traffic circulate from the motorway in and out of the port. Theoretically, the port could develop and we would not have the problem we have now of heavy goods vehicles, HGVs, driving through the town.

Dr. Joseph Hiney

Which is never ideal. It is not the first option one would choose. Even as a transport manager one does not want to be driving through a town.

Could I ask that in Dr. Hiney's discussions with the county council that issue might be discussed? We will discuss it separately in any event.

Dr. Joseph Hiney

It has been discussed. It is a very active part of the discussions. We have discussed a number of issues with the council. We have had proactive and constructive conversations with the council.

Dr. Joseph Hiney

Access is one of them but there are two types of access to a port, one of which is on the land side. Yes, I agree about the northern access route and I understand that even longer ago there was a similar proposal on the south side. That is probably long gone from any files or archives but it was to create that ring circuit of Drogheda town. Marine access, however, is an equally important public good to any port and we have an issue to address in the future in terms of the impact storms have on the entrance to the harbour. The Chairman would know that Mornington Beach, for example, is now extended almost all the way out on the training well. In terms of what will happen next, the sand goes around the corner into the mouth of the river, so we have to plan. That is not just about the commercial port, it is about access to the harbour, to the river. It is about the environment in terms of the impact it would have on local ecology and so on, so we need to explore those issues as well.

May I take the opportunity to come back on the governance point - perhaps I misunderstood the Chairman's question earlier - as distinct from consultation?

Of course.

Dr. Joseph Hiney

Clearly, the governance structure that applies between the board of directors now and the current Minister for Transport, Tourism and Sport is replicated in the legislation in the way we will deal with Louth County Council. As chairman, I will need to prepare, outside of public documents, confidential documents giving a full and comprehensive view to the appropriate body. I am not clear yet on the way that part of the legislation will be implemented in practice but it is a conversation we need to have with the council in the future. Under the legislation, I believe the chairman can be invited or requested - whatever the appropriate words are - to appear before the council up to twice a year to discuss port related issues.

Beyond that, we are also open to how we can communicate better because we will not develop solutions if each body has its own master plan and development plan. That will not work.

Dr. Hiney can correct me if I am wrong but I do not believe there is anything in the legislation that would preclude that option of having a member or a couple of members of the local authority on the board.

On that point, we will ascertain what is the law on that. That will give us the answer.

Correct me if I am wrong but I am not aware there that there is something that precludes-----

When I was on the council, and that is a few years ago now, the chairman was always a public representative. That is not a reflection on your good self.

I have a couple of questions. Does Drogheda Port Company publish an annual report?

Dr. Joseph Hiney

Of course, yes. The same as any other port we would have an annual report and accounts.

How many staff does the company employ?

Dr. Joseph Hiney

The staff - full-time equivalents is the modern term - would be about 8.5, so it is a small operation. Hence, we are trying to keep the number of directors low.

I thank Dr. Hiney for his answers to our questions. I appreciate and welcome his commitment to come back to the committee on the issues we raised. I welcome his appointment and I hope he will be very successful. We will go into private session.

The joint committee went into private session at 3.35 p.m. and adjourned at 4 p.m. until 9.30 a.m. on Wednesday, 27 September 2017.
Top
Share