Prime Minister Tony Abbott has rejected a claim that transport department officials told a cruise line company to move offshore if it wanted to remain competitive in the industry.
However, North Star Cruises representative Bill Milby – a long-time member of the Liberal Party – insists he was given the advice at two meetings with department officials.
In a submission to a Senate inquiry into new shipping laws, Mr Milby said he was told in May and June to consider taking the ship True North off the Australian Shipping Register, re-register it in a suitable foreign country, lay off Australian crew and hire a cheaper foreign crew.
Mr Abbott told reporters in the West Australian seat of Canning on Wednesday: “That is just not true.”
A transport department spokesman on Wednesday also told AAP bluntly: “The department did not provide this advice.”
However, immediately after Mr Abbott’s media conference Mr Milby went on ABC radio to defend his version of events.
Mr Milby said he had initially quizzed Transport Minister Warren Truss at a function in Sydney, who had told him he did not think there would be a problem for the WA company under the government’s new policy.
Mr Milby later sought out an official from the department, who had advised him that shipping was an international marketplace.
“She said, `Well maybe you should consider taking the ship off the Australian registry, reflagging it in a different country and then hiring a foreign crew’,” he said.
“I was gobsmacked.”
Mr Milby said he had asked to continue the conversation in Canberra and met with the same official and another manager from the department three weeks later.
“We virtually continued on from where we left off,” he said.
The legislation before parliament will no longer require foreign ships to pay Australian wages between domestic ports for their first 183 days operating in local waters.
Mr Milby said the government should take a fresh look at the legislation.
“They are taking a machete to something they should be doing with a scalpel,” he said.
Mr Abbott insisted his government was trying to restore the previous shipping regime, saying costs jumped after Labor changed rules for the industry.
“Labor were absolutely catastrophic for coastal shipping and for jobs in coastal shipping,” he said.
Opposition transport spokesman Anthony Albanese said it was “disgraceful and unacceptable” that the government openly advised businesses to sack workers.
Mr Albanese says there’s no way the Australian industry can survive.
“The bureaucrats in the department have responded pretty honestly by saying the only option you have is to get rid of the Australian flag, put a white flag (up) when it comes to Australian jobs and go offshore,” he told ABC radio on Wednesday.
“No Australian industry can expect to compete with a foreign competitor if they’re allowed to pay foreign wages.”
In its submission to the inquiry, the department insists foreign ships that engage in more than 183 days of coastal trading will be required to employ an Australian master or chief mate and a chief engineer.