Trust us, privatisation is the way forward

Dover Harbour Board CEO Bob Goldfield talks to Damian Brett about its plans for privatisation.

Almost as soon as Dover Harbour Board (DHB) unveiled its plans to build a new £400m (US$642m) ferry terminal to cater for projected growth, rumours began to circulate that the port would need to privatise in order to fund the project. 

At the time, while refusing to admit that the port would definitely be privatised, DHB CEO Bob Goldfield also refused to rule it out. 

The rumour mill went into overdrive in September 2008, when port workers went on strike over DHB’s plans to transfer 190 staff into the private sector. Unions warned they saw the transfer as the first step towards privatisation. 

Then in December, the UK government unveiled that six trust ports were considering privatisation, with Dover’s plans the most advanced. 

Last week DHB officially submitted its plans for privatisation to the government and Goldfield says building the new terminal was one of the major reasons for seeking privatisation. 

“T2 is part of it. The government made it quite clear that they would not allow us to borrow the amount of money it would take to deliver T2,” says Goldfield. 

“While there won’t be a commitment [from whoever aquires the port] to deliver T2, we know through our master planning process, that T2 will be required at some point and that we need to be in the private sector in order to deliver it. 

“It’s part of the process, it’s not the only reason, but we are firmly of the view that now is the right time in Dover’s history to go into the private sector to realise its full potential and its ambitions.”

Overall, Goldfield expects the whole process to take 12-14 months, with the sale process starting in the early summer and running for around nine months. 

Opposition
The application is bound to attract opposition from the local community and workers fearful of job losses, cuts in wages and working conditions and under investment in the local community. 

But Goldfield argues the move will benefit workers and the local community. 

“[The plan we submitted to the government] includes, for instance, the establishment of a port of Dover community trust, a charity, to funnel some funds into local regeneration,” says Goldfield. 

“One of our objectives is that we would like the running of the business to remain in Dover and another is that we’d like to see a commitment to allowing the employees to share in the business in a way they haven’t before; through a share ownership trust. 

“As far as the local community is concerned, it is up to us to show the advantages of going down the route we are going down and we’ll be doing that with a lot of formal consultation. 

“Throwing off the shackles of trust port status allows us to have much more involvement with the community and give the community a lot more back than it’s had in the past,” he adds. 

Job Losses
Goldfield is candid about the potential for job losses, but claims that it will be easier for the port to develop if it is privatised, and this means jobs will created. 

“Jobs are always an issue,” he says. “But if the centre of the new organisation remains in Dover, there is no reason why there should be substantial job losses. 

“There might be some on the margins but that’s always the case as we are always looking for efficiencies in the organisation. Certainly as a result of restructuring we would not see job losses as an issue. 

“In fact, growing the business is going to be a prime objective here, so we would see job opportunities in the future, rather than job cuts.” 

Ferry Operators
Concerns over privatisation may also be raised by the ferry operators at the port, but Goldfield says they seem generally supportive of the scheme, although they are reserving judgement until they have seen the application in detail. 

One major concern for operators is that privatisation may result in increased fees, but Goldfield says this is not the case. 

He explains the fees ferry operators pay are governed by the services they have requested from the port. 

“The ferry operators understand that if we are going to provide them with the infrastructure they need to do their business, it will cost millions of pounds. 

“They will have to pay for whatever infrastructure they want us to build in order to deliver what they need for their customers. 

“It’s a much wider discussion than ‘the private sector is going to charge more’ - that’s not necessarily true. 

“The new owners will charge what is required to deliver what the customers need, plus a reasonable return on their investment.” 

Another concern is that Dover will be sold to a company looking to make as much money out of the port as they can before selling it at a profit. 

But Goldfield says the application includes clauses that will stop this from happening. 

For one, he says, anyone buying into the port will need to fulfil the board’s long-term vision. 

Goldfield says: “The main point is that we are after value for money rather than the highest price. We are not washing our hands of the responsibilities of a trust port by any means. 

“Dover is an attractive proposition to any investor, it is strong financially, it has got a good strong robust business and we have certainly had indications that the market is interested, so I don’t think we’ll have any difficulty in finding the right sort of partner.”