The Federal Government has used extraordinary powers to allow a controversial foreign ship to operate off Queensland without permission from the State Government.

The bulk carrier Stadacona formerly known as the CSL Yarra sailed out of Townsville for Gladstone yesterday without the normal permits required by the Queensland Government, the ACTU said.

Federal Transport Minister John Andersons department had issued an unprecedented special exemption under the Navigation Act to let the foreign ship operate.

Experts believed it was the first time in Australian history that the special exemption power had been exercised to allow a foreign registered ship employing foreign seafarers to work on Australian intrastate trade.

“The Federal Governments policy of issuing more and more permits for foreign ships to take over the Australian coastal trade is destroying the Australian shipping industry,” ACTU Secretary Greg Combet said.

“Flag-of-convenience ships do not pay Australian wages or taxes and are a risk to border protection because they are not subject to full immigration and customs controls. Sub-standard foreign ships are also a threat to our marine environment, including the Great Barrier Reef. John Anderson is welcoming them with open arms.”

The Stadacona, formerly named the CSL Yarra, was at the centre of a dispute with maritime unions in May when the ships owners, CSL, sacked its Australian crew for cheap Ukrainian seafarers and transferred the ships registration to the Bahamas.

Evidence to the Federal Court in April stated that the Ukrainian seafarers wages were $19,600 a year compared to $52,100 a year for Australians.