Last Monday the government announced that a consortium made up of TF Shipping Agencies Limited, which is a subsidiary of the Tumas Group, and Portek Ports (Mauritius), which is based in Singapore, was selected as the new cargo handling operators in the Grand Harbour.

This brought to an end a long process through which the government, through the Competitiveness and Communications Ministry, intends to bring port operations up-to-date and in line with modern work practices. Now that the new operators have been chosen, the next step is that the consortium next month takes over from Cargo Handling Company Ltd, which has been running port operations for some 30 years.

Minister Censu Galea has spearheaded the much-needed reform in the port, which took several months to accomplish but was completed before Cargo Handling Co. Ltd’s contract expired. The government is now looking forward to a smooth transition that will lead to improved port operations.

The fact that, at least until now, both the General Workers’ Union, which owns Cargo Handling Co. Ltd, and the opposition have remained silent – even after the consortium including the GWU was eliminated when the government announced a shortlist of two consortia – is a sign that the government has worked in the most transparent manner on this issue. However, it might still be too early to tell.

The consortium has pledged to invest Lm5.2 million in new port infrastructure. The company will also pay the government Lm350,000 in rent every year, with another two per cent of revenue based on the volume of cargo arriving in the Grand Harbour going to the Malta Maritime Authority. Another Lm500,000 will be spent to repair the Deep Water Quay. The contract is valid for 30 years.

One important note is that the company has accepted to employ all the workers of the Cargo Handling Company Limited and will also engage more staff to work as delivery clerks and tally clerks.

But the big news for industry is that, according to the government notice announcing the deal, the company will be reducing the rates presently charged for the handling of cargo.

Several business organisations often complained about the high tariffs imposed for the handling of cargo in the Grand Harbour. It was even said that on occasions, transport costs from a given country were cheaper than the costs businessmen incurred in the handling of the cargo in Malta. The costs will now be reduced, and what is hoped by consumers is that this decrease will also be transferred on to the products they purchase.

Moreover, the new contract is aimed at improving efficiency in the handling of goods, increasing the workload and at the same time, upgrading the reliability of the service. As things stand now, port operations in the Grand Harbour are not competitive, both because the service is expensive and because it is slow in comparison with, for example, the Malta Freeport and other ports abroad.

The way the system works at present is unnecessarily complex and outdated. Costs do not really reflect the number of man-hours actually required, but are based on tariffs when port work was more labour-intensive and as such do not reflect the present day circumstances.

There are too many hands involved in the current system, and this inevitably leads to a multiplicity of service providers that result in double handling and, of course, double charging, not to mention the waste of time.

The market has also changed from what it was 30 years ago, and what was good in the 1970s is no longer valid today. This is another reason why there is a need to reform the cargo handling operations.

A fresh start was needed in the Grand Harbour and it is about to happen.