Maritime bill moves to increase compensation limits for oil spills

The Government is moving to increase the legal liability for marine companies responsible for a major oil spill from a tanker.

Transport Minister Simon Bridges introduced the Maritime Transport Amendment Bill to Parliament last week but the first reading was yet to be heard.

Mr Bridges said the bill was not a direct result of the Bay's Rena oil spill disaster, but it was really "good housekeeping" to make the changes given international developments in respect to these matters.

These included amendments to the Supplementary Fund Protocol, which would help protect the coastline by increasing the legal liability limits for oil tanker companies in the event of a major oil spill, he said.

The protocol is part of the International Oil Pollution Compensation Funds, and New Zealand is a party of one of these funds.

New Zealand had access to up to $377m in compensation in the event of a major oil tanker spill . The bill proposes that the Government joins a second fund which would increase the maximum compensation to about $1.392 billion.

"In the incredible unlikely circumstances of significant oil spillage it would mean all the costs of clean-up would be paid for the tanker company," Mr Bridges said.

Mr Bridges said, under the bill, New Zealand would also exercise its right to exclude the cost of wreck and cargo removal, and remediate the damage from the liability limits.

"It was important to make sure that those responsible for causing the problem pay."

Nevan Lancaster, spokesman of the former Rena Business Compensation Group, said the bill was a move in the right direction.

"Anything is better than nothing but I'd like to see the liability limits lifted completely for all ships coming to our shores," he said.

Mr Lancaster said he had little confidence that if the bill became law the Government would uphold its position if challenged by an international shipping company.

Buddy Mikaere, spokesperson for Ngai Te Hapu of Motiti Island, agreed.

"This is a small but timid step in the right direction but I would like to see the legal liability limits increased for all shipping regardless of the nature of the cargo," he said.

Mr Mikaere said Ngai Te Hapu of Motiti Island would definitely be making a submission on the amendment bill when it reached the select committee stage.

Tourism Bay of Plenty chief executive Kristin Dunne said it was critical that funds were available to help the affected destination recover from all effects of the disaster.

"Hopefully, this insurance can ensure there will be funds to help the destination recover from the physical ill-effects as well as reputational damage," she said.

"From a risk management perspective the Government looking to implement such an insurance seems very sensible given the importance of the marine environment."

Other aspects of the Maritime Transport Amendment Bill include:

- Requiring commercial maritime operators to have drug and alcohol management
plans, including random testing for staff carrying out safety sensitive activities.

- Maritime NZ would have the power to undertake extra drug and alcohol testing
as part of their oversight and monitoring role.