Secret Deals

New Zealand Centre for Political Research

The New Zealand Centre for Political Research is a web-based think tank that takes a research-based approach to public policy matters and encourages the free and open debate of political issues.

Government advertisements in newspapers last month encouraging iwi to lodge claims for the country’s foreshore and seabed are a reminder of a growing complacency in New Zealand. At a time when leaders around the world are increasingly concerned about the dangers of social division caused by radical separatism and extremist ideologies, our governments have created and continue to support a privileged tribal elite. This elite lives like royalty on the proceeds of taxpayers’ funding, while disadvantaged members of their wider tribal groups struggle in the country’s worst social statistics.

The old Gisborne-Tolaga Bay Coach Road 1890s

As a nation founded on egalitarianism, is a racially defined class-based society really the sort of future we want?

Claims for the ownership of New Zealand’s coastline are part of a list of demands that are being sought by corporate iwi. Most recent are calls for the ownership of the country’s fresh water, claims for Crown land earmarked for affordable housing in Auckland, demands for free state houses, for tribal representation on local body councils, for ownership rights to parks, rivers, and mountains. There has even been a demand for the inclusion of trout in a Treaty settlement – despite of a Court of Appeal ruling that customary rights do not apply to trout because they are a European fish introduced by settlers in the 1860s.

Without a doubt, iwi demands are becoming more frequent and more far-reaching, but rather than confront their motivation, governments usually adopt the line of least resistance and give in. Appeasement is the easier path for career politicians.

This is certainly the case with the privatisation of our coastline. Tribal ownership of the foreshore and seabed was the price the country paid for the National Party’s coalition deal with the Maori Party in 2008. Iwi leaders wanted the 2004 Foreshore and Seabed Act repealed. That Act had been introduced by the Labour Government to re-affirm Crown ownership of the coastline, following a controversial Court of Appeal ruling that some tribal groups may have customary interests in the marine and coastal area.  The replacement law, the Marine and Coastal Area Act, opened the coast up for tribal ownership – but without the need for iwi to prove their claims in court.

This week’s NZCPR Guest Commentator, Dr Hugh Barr of the Council of Outdoor Recreation Associations of New Zealand, outlines the present situation:

“This article updates information on the National Government’s highly controversial 2011 Marine and Coastal Area Act, that allows Maori tribal privatisation of the foreshore and seabed, through gaining Customary Marine Title over these priceless resources. The Act is the brainchild of pro-Maori Treaty Claims Minister Christopher Finlayson.

“It is now more than four years since this Act came into force. Over forty highly optimistic and large claims have been lodged by tribal groups, generally in areas with highly productive fisheries e.g. along the eastern coasts of the North Island from Wairarapa to Cape Reinga.

“But no Customary Marine Titles have yet been awarded. However, now that the National Government has been returned with 59 MPs in the 121 seat Parliament, and a comfortable majority assured on this issue by the two Maori Party MPs, Finlayson can now push claims through without hindrance.

“This is regardless of whether the Claims meet the specific conditions required by the Act. As a consequence, the Office of Treaty Settlements, which manages Marine and Coastal Area Act claims, is now scuttling around the country encouraging tribal claimant groups to lodge claims before the April 2017 expiry date.”

At this stage, eleven claims are listed on the Ministry of Justice website as being under direct negotiation with the Minister. They include a claim in the Kaipara District by the Te Uri o Hau hapu that goes right out to the 12 nautical mile Territorial Sea limit and is made up of two parts – one on the west coast includes the northern part of the Kaipara Harbour and much of the Poutu Peninsula up towards Dargaville, and the other on the east coast extends to the edge of the fashionable Langs Beach development and covers the popular Mangawhai Beach area.

The problem is that under the new law, deals between claimant groups and the Treaty Negotiations Minister Chris Finlayson are carried out in secret. There is no requirement for claimants to prove they have used the area exclusively and continuously since 1840 in an open court of law – as was the case with the 2004 Foreshore and Seabed Act. That’s the real reason why iwi leaders wanted the law changed.

Openness and transparency are at the heart of democratic government. Yet here we have a situation where priceless public resources are about to be given away in secret. Where are the safeguards to ensure there is no corruption and that claims aren’t being fabricated? What about the rights of the public and councils to have a say – it’s their beaches too? What avenues are available to those who oppose the claims and believe they are bogus – where is their right to have their voice heard? Who will ensure that the advocacy of powerful iwi leaders does not trample over the rights of others?

For too long governments have indulged the iwi elite – particularly their claim that they are Treaty partners with the Crown. But as Judge Willy says in his Sovereignty and the Treaty of Waitangi report, “It is constitutionally impossible for the Crown to enter into a partnership with any of its subjects”. He explains that while Ministers and senior Government officials regularly enter into joint undertakings with outside entities, they do so as servants of the Crown and not as the Crown.

It is through government concessions, that corporate iwi are enriching themselves and becoming more influential. As Ngapuhi leader David Rankin recently warned, “If you think the claims are nearly at an end, think again.  Hundreds of new claims are being planned right now.  These will challenge the Crown and seek compensation for the handling of the current settlement process.  Too many people have too much at stake for the claims process to end.”

When Treaty settlements are made, iwi leaders refuse to use these taxpayer funds to alleviate poverty and deprivation amongst struggling tribal members.

Sonny Tau, the chairman of Ngapuhi, the country’s northernmost tribe, confirmed this only too clearly in a recent interview with Radio New Zealand’s Kim Hill, when he explained that the several hundred million dollars they expect to receive from their Treaty settlement, will not be used to help improve the welfare of their tribe. Echoing the mantra used by all iwi leaders, he claimed that the social responsibility for tribal members is the duty of the Government – not the iwi.

Successive governments have turned a blind eye to this despite an expectation from taxpayers that the public wealth being given to iwi leaders will be used to improve the status of Maori overall.

The situation has been made worse through the introduction of race-based policies – particularly the last Labour Government’s ‘by Maori for Maori’ funding model that enabled iwi leaders to pick up well-paid government contracts to provide social services to their tribal members. The problem is that these contracts are linked to Maori deprivation, so it has suited corporate iwi to leave their members over-represented in all of the worst social statistics

The only Cabinet member to publicly challenge this agenda of iwi leaders is the former Minister of Social Development Paula Bennett, who, five years ago said it was time they stepped up to help their people: “I have here a list of the iwi affiliations for about 71 percent of the 2,227 Maori children in Child, Youth and Family care right now. Child, Youth and Family has 66 Tuwharetoa kids, 111 Ngati Porou, 80 Ngai Tahu. We have 393 from Ngapuhi, 21 Ngati Kahununu, 10 Te Atiawa … I could go on. I want these children in families, not in care.

“What if we asked iwi to look within themselves and ask what can we do? So I want to know if you … will you put your hands in your own pockets and commit some resources to a joint effort?”

Things have moved on since that time. Iwi leaders strongly support Whanau Ora, where they are now taking a leadership role and look set to gain even more lucrative taxpayer funded contracts – based on, the greater the tribal disadvantage, the greater the resourcing.

If Ngapuhi’s Treaty settlement money was not going to be used to improve tribal social outcomes, Kim Hill wanted to know how it would be used. Sonny Tau said it would become a “money-making machine” – but their first priority would be to “pour resources into marae”.

Marae, of course, are the key to two special privileges available to tribal corporations that were passed into law by the previous Labour Government.

The first is that being involved in managing a marae enables an iwi corporation to register as a Maori Authority and pay the special tax rate of 17.5 percent – instead of the 28 percent rate paid by other businesses.

The second is that if an iwi corporation is involved in the administration and management of a marae, then it can apply for charitable status and avoid paying any tax at all.

To be considered as a charity for tax purposes, an organisation has to meet common law requirements: it has to be established for a charitable purpose and it has to meet a public benefit test – to ensure it has been set up to provide a genuine benefit to the wider community, not to individuals connected by contractual arrangements or by blood ties.

Since Maori tribal corporations are based on blood ties, they failed the common law public benefit test and were unable to register for charitable status – until Labour changed the law. In their new Charities Act 2005 a provision was included in section 5 (2), which provided an exemption from the blood tie disqualification by allowing blood relatives to register as a charity so long as they are involved in the administration and management of a marae.

This means that not only do some of the country’s richest business corporations avoid paying any contribution to the government’s tax base at all, but their tax-free status gives them a major competitive advantage over other New Zealand businesses.

Race-based government policy and taxpayer funding has created a powerful iwi elite and a two-tier society, but it has done little to help those Maori most in need. Wealthy tribes appear content to leave that responsibility to the government and taxpayers, so they are free to pursue their own self-interest.

At a time when governments around the world are recognising the dangers to social cohesion caused by racism and extremism, in New Zealand there appears to be not only a lack of political courage to confront the rorts and rackets being harvested by the iwi elite, but also a lack of political will to address the perverse incentives within the Maori grievance industry.

The simple reality is that career politicians won’t confront these race-based issues while they have to rely on the support of the racist Maori Party to govern. But if more New Zealanders acknowledged that race-based policies and programmes are becoming a serious threat to our future, then the tide could turn and politicians pursuing their abolition may gain a majority in government and the ability to bring about change.


Do you believe the process of granting of customary rights to the foreshore and seabed should be fully disclosed and transparent?


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