Your pic shows (bottom to top) rudder post with threaded tube, thin gland lock nut, larger gland nut and gland which holds packing, and rudder shaft. Often the rudder gland is above waterline anyway - yours seems dry when photographed. The gland only works when the boat is working/healing. Also, rudder doesn't turn rapidly like prop shaft so little (no) chance of overheating and scoring the shaft. First option is to clean it up and see whether much water is coming in when you've been sailing. You could next try tightening the gland a couple of turns. If you really want to play, buy some new Teflon/impregnated packing suitable for your rudder stock diameter, undo the gland and replace the old packing. Hook out the old packing with a small pick or similar. Wrap new packing round the rudder stock 5-6 times then cut it longitudinally along the stock to form a number of washers. Pack them in the gland with cuts 180 degrees away from previous one, like with rings in a motor. You won't need to lift the boat for this job.

I had the opportunity to observe exactly same thing, leaking underway only. If it's bothering you grab a couple of big spanners and see if you can nip it up, just a flat or point at a time. If not then you might want to repack it, if it's dry you can do it comfortably in situ, if you have water ingress you can still do it in situ just not so comfortably. The right size packing is the difference between the shaft and the internal of the packing nut minus a couple of millimetres

Thanks for the help gents the boat is a s@s 30 defiant on lake mac.quarie so no tide to worry about. I also found a video on u tube that is the same gland. I will try to have a look next week and i will let you know. Does anyone have a trained squirrel that I can borrow because the access is extremely limited.

Hi Ramona, followed your suggestion on tuesday and went sailing, all is well again.