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Opinion: Poor planning, lack of consultation stymies sales

Monday, September 10, 2012
Poor planning, lack of consultation stymies sales

by Grant Duncan

The controversial policy to sell shares in 49 per cent of state-owned electricity generating assets has, in turn, unleashed an equally controversial claim for indigenous rights in the waters that these utilities depend upon.

The government wishes to push ahead with its sales process, but it has had to delay this in order to consult with iwi. This arises from the interim findings of the Waitangi Tribunal on a claim regarding water and geothermal resources.

The politics of this situation are complex and fast moving. So, for the confused onlooker, it may help to summarise a few points about the differing views of the Government and the Waitangi Tribunal.

The Government’s position has shifted somewhat. At the time of writing, it still maintains that "in common law no-one owns water", but concedes that "Mäori do have rights and interests in water". Now, anyone who has a hot shower in the morning could be said to have rights and interests in water. But, we should take it that the Government is recognising that Mäori do (at least) have rights and interests as indigenous people, in addition to the rights and interests of all New Zealanders.

Clearly though, the Government does not agree with the findings of the tribunal. In its interim decision on the water rights claim, the tribunal found that in 1840 the Treaty of Waitangi effectively preserved for Mäori an "exclusive right to control access to and use of the water while it was in their rohe [territory]" – and that this meant, in terms of the English law at that time, nothing less than "ownership". It says what this now means, in terms of New Zealand law, is that Mäori have "residual property rights" in water.

Parliament could, of course, pass law to uphold or to extinguish any such rights – but to do either would be extremely contentious. For the time being, then, each side’s point of view is mere opinion until a firm settlement is concluded, either through Crown-iwi negotiations or in the courts.

Courtrooms are places where the Key Government probably wishes not to find itself, however.

To mollify litigants, the Government has tried to reassure them that the partial sale of a power-generating asset would not adversely affect "the Crown’s ability to recognise Maori rights and interests in water".

This may be true, provided you stick to the loose idea of rights and interests, rather that the tribunal’s stronger opinion about residual property rights.

The tribunal’s opinion is that, without a prior settlement with affected Maori, asset-sales to private investors would materially impair the Crown’s ability "to provide a meaningful form of rights recognition for Mäori in respect of its water bodies". But the tribunal is talking about property, and so it wants the matter settled before the horse has bolted. Hence it called for a delay to the sales process to allow time for negotiations.

But, what does the Tribunal mean by "a meaningful form of rights recognition"? It finds that shares in the power companies will not suffice. It recommends what has become known as the "shares plus" solution: ‘Shares in conjunction with shareholder agreements and revamped company constitutions [that] could give Mäori enhanced power in the power-generating companies that control and use their taonga.’

Now, the Government has not openly ruled out shares on their own as a means of settlement with iwi and hapu, but it has (so far) ruled out "shares plus". It has decided to delay the sale of Mighty River Power shares until next year – but this is due more to fear of a High Court injunction against the process than to a desire to consider whether Māori may have residual property rights.

In the statement issued from the Beehive on August 24, the Government announced it will undertake consultation with iwi on the “shares plus” concept, and then asserted that the "shares plus" model "should not be progressed".
But politicians cannot genuinely consult about a concept they have (genuinely) already decided should not be put into practice.

I cannot predict how this tussle will conclude, but New Zealanders have reason to be disappointed in these poor planning and consultation processes. Mr Key’s advisers ought to have known that Mäori would object to any jeopardy to their potential water rights when asset sales were first mooted four years ago. The matter could have been resolved by now, and the sales would then have continued with much greater certainty.

New Zealanders with an interest in buying shares in the power generators deserve to be able to make plans secure in the knowledge that property rights are protected by a predictable rule of law. Article 2 of the Treaty was intended to provide such certainty for the first inhabitants of this country, and we should all be worried if any government tries to ride roughshod over such rights.


ENDS

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