$200m funding for US Ships

US Congress votes to fund a merchant fleet of 60 US flagged and crewed vessels

The Australian Government may be all the way with the USA when it comes to unilateral military aggression or old-fashioned redneck politics, but not when it comes to respect for its merchant marine.

"While John Howard has joined George Bush in waging the so-called 'war against terror' to secure his own political future in Canberra, he has done nothing to secure Australia's maritime borders," said National Secretary Paddy Crumlin.

Australian shipping gets nothing from the federal government - no protection, no funding. But in the US the Special House Armed Services Committee has upped its support to the US merchant marine from the existing US$100 million per annum program that already funds a special merchant marine fleet of 47 US flagged and crewed vessels to around US$156 million per annum (more than Australian.$200 million/annum).

Now it's expanding the fleet to 60, with each vessel receiving US$2.6 million (up from US$2.1) for 10 years from 2005 when the old Maritime Security Program expires until 2015. The legislation has already passed through the Congress House Armed Service Committee, The Senate Commerce Committee and the US House of Representatives according to reports in the West Coast Sailors and the Seafarers' International publications.

Michael Sacco, President of the Seafarers' International Union worked jointly with the industry including Maersk and American President Lines to achieve this commitment. It was also backed by the military.

Why? Because the United States of America believes national flag shipping is integral to their security and their economy.

In the words of William G Schubert, Department of Transportation and Maritime Administrator: "It is critical, now more than ever, to have a strong US merchant marine and US crews. US crews employed on US flag ships provide the pool of seafarers needed for both commercial and government sealift fleets in times of national emergency or crisis. Encouraging shipowners to return to the US flag is a daunting task, especially when compared to the economic advantages of open registries. However, the best way to protect our homeland and national security interests across the globe is a strong US flag fleet manned by US citizen mariners."

In Washington last year the House Armed Services Committee dedicated several weeks to submissions on Flags of Convenience and their implications for National Security.

This is in stark contrast to Australian government policy. Canberra still encourages FOC vessels to replace Australian flagged vessels on our coastal trade, using loopholes in the Navigation Act.

This budget the Federal Government announced a multi-million dollar maritime security package. Not one dollar went towards Australian shipping. Nor has anything been done to screen Flag of Convenience ships getting single or continuous voyage permits to work our coast.

The Howard Government insists there is no risk. But in the US there is even talk of restricting its international trade to US flagged and crewed vessels. No one doubts the risk FOC shipping poses to US ports and harbours.

In the words of Rear Admiral Paul J Pluta, Department of Transportation US Coast Guard: "With more than 7,500 foreign flag ships originating from 92 different flag states making approximately 51,000 port calls annually, the United States faces a significant challenge. There are two areas of concern - vessel safety and maritime homeland security.

"Ships arriving in US ports are currently required to report the name of the registered owner of the vessel as well as the vessel operator," the Rear Admiral said. "However, in many cases, the registered owner of the vessel is no more than a shell entity created solely for the purpose of being designated as a vessel owner, with no actual control of the vessel."

He describes the massive flow of people and goods across US maritime borders as "fuelling our economy, but also serving as a potential conduit for terrorists and weapons of mass destruction".

US authorities and industry players, including unions, are of one voice when it comes to shipping and security.

William G. Schubert cited an IMO study on fraud in the industry which uncovered 12,635 cases of forged certificates and roughly as many incidents of "laundering". In the latter case forgeries were used to obtain legal qualifications from authorities who failed to check for original documentation. These were then used to obtain jobs on board vessels, for illegal immigration, piracy, drug trafficking, people smuggling and other criminal activities.

Alex Vines, Senior Researcher, Human Rights Watch, told Congress how FOC ships provided ideal cover for setting up front companies: "Flags of Convenience offer a high level of corporate secrecy and are easy to obtain. Some flags appear to be particularly inviting for illicit arms trade networks. Falsely declared cargo is a favourite method for concealing weapons and the sheer size of this trade makes effective inspection difficult, though not impossible."

At issue is the lack of accountability when dealing with open registries.

Peter Morris, chair of the International Commission on Shipping, also addressed the committee.

Morris said he could not envisage any reliable system of ensuring the true identity of a ship's crew or owners, based on the present regime of offshore registers.

"Shipping seems to be burdened with the baggage of history in its obsessive desire for secrecy," he said. "Transparency in shipping is fundamental to security."

Also addressing Congress were representatives of the International Transport Workers' Federation. The Federation lobbied for legislation authorising the US Coast Guard to refuse entry to US ports to any non-US flagged vessel that does not provide the full identity of the beneficial owner.

David Heindel, ITF seafarers section, calls FOC shipping "runaway flags", because the vessel owners escape legitimate scrutiny, regulation and obligations to national security, and "mercenary flags" because the flag is literally for sale. The shipping register is no more than a profitable foreign exchange earner in annual registration fees.

"The Flag of Convenience device has been subject to abuse. Some limitation must be placed on the use of that device, if not total elimination," said Heindel.

In his address on World Maritime Day National Secretary Paddy Crumlin said that an Australian merchant marine was essential to national security. The lives of Australian seafarers given in defence of their country is a testament to this. One in eight Australian seafarer died in WWII, mostly in Australian waters.

General Hugh Shelton, Chairman of the Joint Chiefs of Staff to the US Merchant Marine Academy: "Ask any officer from any of the services who has had the opportunity to serve on a joint task force in the myriad of hot spots around the globe - just ask any of them if the US merchant marine is important to their operations. You will not only get a 'yes', but a resounding 'yes-and-can-I have-more'! As has long been said, the Merchant Marine is our Nation's fourth arm of defence."