Steve Matthews | Lloyd’s List | 2010.10.18
EFFORTS to end the recruitment of seafarers in Manila’s Luneta Park are intended to curtail illegal recruitment, provide better protection for seafarers and stop poaching from driving up wage rates for officers that are in short supply.
The Philippine government’s crackdown is having some impact and most of the leading crewing agencies in the country support the move.
However, the Philippines could make a substantially greater contribution to meeting the increased global demand for officers, but according to one leading crewing agency efforts are being hampered by a continued unwillingness of shipowners to sanction the necessary investments.
Opportunities to step up the numbers of Filipino officers are being wasted because potential graduates from maritime academies are being denied shipboard opportunities to meet sea time requirements.
In an effort to clean up recruitment at Luneta Park, the Philippine Overseas Employment Administration stopped issuing the Special Recruitment Authority that is required for crewing agencies to set up booths to carry out recruitment there.
As existing SRAs and leases expire, recruitment booths rented out to agencies by the Luneta Seafarers’ Welfare Foundation are disappearing. This means that in effect there will no longer be any legal recruitment of seafarers in Luneta Park.
Agencies continuing to do so run the risk of having their licence suspended and incurring heavy fines. Leading crewing agencies have already largely ended recruiting there. Instead, officers looking for seagoing jobs must go to agencies’ offices, while agencies must use other ways of marketing their services and advertising jobs.
Miguel Angel Rocha, executive vice-president at CF Sharp Crew Management in Manila, told Lloyd’s List: “Both large and small owners are commonly poaching officers. I believe this development will slow the rise of wages and make poaching officers more difficult for shipowners. Sharp supports the POEA decision and we no longer recruit in Luneta Park.”
He suggested that some smaller agencies that had a difficult time attracting crew to their offices faced a greater challenge in trying to recruit officers and it would therefore be harder to engage in poaching and competitive increasing of wages.
“Ultimately, I believe this is a positive move for the industry at large and will keep wages in check in the long run.”
Recruitment of seafarers in Luneta Park has been taking place for many years. It became more formalised when Luswelf established its Seafarers’ Centre and crewing agents were permitted to set up booths. At one time there were about 120-130 licensed recruitment booths set up there.
That situation changed in June when the POEA announced that from July 1 it was ending authority to license recruitment booths and no new licences were being issued.
In addition, the new Migrant Workers’ Act significantly tightened up rules on recruitment to protect the rights of Filipinos working overseas, including seafarers.
By early October the number of recruitment booths in Luneta Park was down to about 60-70 and will continue to decline as licences expire.
According to the POEA, there were 421 licensed crewing agents in the Philippines at the beginning of October.
Gregorio Oca, president of the Associated Marine Officers’ and Seamen’s Union of the Philippines, told Lloyd’s List: “Since licensed manning agencies continue to operate, there should be no impact on the deployment of seafarers. What has changed is the manner of using the booths.”
He stressed that Amosup had no connection with Luswelf, but the union supported its efforts to develop Luneta Park to provide protection for seafarers.
“Amosup saw the need to set up tents and a seating area for the multitude of seafarers who traditionally congregate in that place. But it was Luswelf that constructed the booths to lease to manning agents,” said Capt Oca.
Agencies continuing to recruit in Luneta Park are not allowed to advertise using signage or to advertise wages. But some agencies are trying to get around the new regime by sending representatives to the park and meeting with potential recruits on an individual basis. If they are found doing so they are likely to face court action.
The larger crewing agents have sufficient resources to conduct recruitment using conventional means based in their Manila offices, many of which are close to Luneta Park.
Mr Rocha said that Sharp never recruited many officers at Luneta Park and most seafarers would go to the agency’s offices.
He said the increase in poaching officers and escalating wages — which reached its peak during the period of greatest shortages in 2007-2008, and could return as shipping markets recover and the fleet grows — is symptomatic of the lack of investment in developing Filipino officers by recruiting and training cadets. “But still no one is investing.”
This investment is the responsibility of owners. A common defence from owners for this deficiency is that if they invest, trainees will simply be poached by other owners. But this is a circular argument which ends up with overall inadequate investment and loss of opportunities for potential Filipino officers.
Some leading owners do invest in training Filipino cadets and directly in training facilities there. They try to retain them when they have qualified by offering attractive employment packages rather than short-term contracts, even if others offer higher wage levels in an effort to poach them.
According to figures from the POEA, there were 329,728 Filipino seafarers employed on board ships in 2009. However, a large majority of them were ratings and efforts to increase the supply of Filipino officers has had limited results. Only about 43,000, or 13%, of all Filipino seafarers were in junior officer ranks.
There are an estimated 100 maritime academies in the Philippines, with about 80,000-100,000 students. However, to qualify for seagoing certificates as officers, as well as needing to pass professional exams, they need to complete 12 months sea time.
According to Mr Rocha, less than 10% of these graduates currently complete the required sea time by the time they finish their courses. Of the remaining 90%, less than 10% never complete their sea time.
“This represents a huge waste of potential,” he said. As a result only about 1,000 Filipino cadets actually go to sea each year. “This is pretty pathetic,” he added.
The reason for this failure is that shipowners do not offer sufficient opportunities for Filipino cadets to go to sea or provide enough facilities on board their ships. The option of officer cadets signing up as ratings to gain their sea time is not a solution.
Efforts to encourage ratings to qualify as officers have had some effect, but it takes time and has not produced enough new officers to make significant inroads.
Mr Rocha said that if more owners sponsored Filipino cadets, up to 80% of the maritime academy graduates could obtain licences, allowing for some dropping out and failing exams. This would be more than sufficient to meet the global shortfall.
He said that Sharp had about 250 cadets at any one time spread over their four-year training period, equating to about 60-70 per year. “We have about 10,000 seafarers on board ships and we are fairly typical, which shows the scale of the problem. We are large enough to represent a microcosm of what is going on in the Philippines and our figures are representative of the overall situation.”
He added that some of Sharp’s client owners would like to crew ships fully with Filipino officers and ratings. Philippine shipping companies do not have enough capacity to provide these facilities so it must come from international owners.
Many owners still prefer to use eastern European officers and Filipino ratings and claim they do not have the resources to train Filipino cadets.
“But the problem will get worse and if they leave it too late the industry will have a big problem,” Mr Rocha said.
“The supply of officers from Europe will continue to fall and the industry will need to replace them from somewhere. It is hard to see how it will play out, but it will not be pretty. Too many owners are burying their heads in the sand and hope that they can continue to poach officers.”
During the recession the escalation of wage levels of Filipino officers slowed down and this has been aided by the changes in Luneta Park, but wage differentials between Filipino and eastern European officers have narrowed and the gap will continue to close.
“Filipino officers are no longer a bargain basement option, but the problem of recruiting officers is a global one,” Mr Rocha said.
“There is nowhere else for owners to go for officers other than the Philippines.”
He said that poaching could continue as a short-term fix for some owners and crewing agents, unless something changed. Ending recruitment at Luneta Park might ease the problem of poaching, but if owners commit the necessary investment to recruitment and training of cadets the need for such activities would recede.