Intoxicated by a cocktail of power and entitlement

(First published in the Nelson Mail and Manawatu Standard, September 12.)

The partial privatisation of state assets, the flagship policy of the National-led government’s second term in office, is looking like a train wreck.

For this, National must shoulder a large part of the blame. Even when the MOM (“mixed ownership model”) emerged as the defining issue in last year’s election, National failed to sell the policy to voters.

Granted, it was never likely to excite political passion, other than from opponents; but still, the government could have done a lot more to explain why and how the country was going to benefit.

Thus, although prime minister John Key could reject calls for a referendum by insisting National won the biggest referendum of all (“it’s called an election”), public support for the proposal never seemed more than lukewarm.

Even as the deadline for the float of shares in Mighty River Power neared, vital details such as how shares would be allocated – and how the government would ensure they ended up in the hands of New Zealand mums and dads rather than foreign corporate interests – still seemed vague. “Half-cocked” barely begins to describe it.

Perhaps more damningly, the government appears not to have anticipated the Maori Council’s application to the Waitangi Tribunal to block the sale. That they didn’t see it coming suggests National placed too much faith in its cosy relationship with the iwi leadership group, which represents the Maori tribal elite.

Presumably the government thought any Treaty issues could be resolved with iwi leaders behind closed doors, as has become the pattern. Inevitably this would have involved guaranteeing iwi some sort of preferential treatment when shares were allocated.

But in the background, a power struggle was bubbling away within Maoridom. The long-quiescent Maori Council, resentful at being supplanted by the iwi leadership group as the supposed voice of Maoridom, decided to reassert itself and did so spectacularly, by shoving a stick in the government’s spokes.

Mr Key was justified in calling the council’s action opportunistic, yet it should have come as no surprise. It was entirely predictable that the Maori Council – a statutory body created to advise the government on Maori issues, and which purports to represent all Maori, not merely the wealthy tribes – should feel irritated at being usurped by the iwi leadership group, which has no status in law.

That’s not to say the motives of the Maori Council are pure, because I don’t believe they are. But we can come back to that issue later.

The net effect of the council’s action and the Waitangi Tribunal’s decision in its favour is to create doubt and uncertainty around the asset sales. That has the potential to greatly reduce the value of the assets, since investors don’t like uncertainty.

As if that weren’t enough, other factors largely outside the government’s control have contrived to take the shine off the asset sales programme.

Solid Energy, another of the state companies lined up for partial sale, recently reported a $40 million loss and is talking job losses and mine closures.  

More worrying still is the uncertainty over the Tiwai Point aluminium smelter, New Zealand’s biggest electricity user and the key customer of another state company being lined up for sale, Meridian Energy. Tiwai Point’s owners want to review their electricity contract because of falling demand for aluminium, with potentially serious implications not just for Meridian’s profits but for power prices generally.

And just to prove that problems come in threes, another big electricity consumer, newsprint manufacturer Norske Skog, is planning to halve production at its Kawerau newsprint mill. That will have an impact on Mighty River Power’s books and add to a looming electricity surplus.

Given all these factors, it’s hard not to feel some sympathy for Finance Minister Bill English. The continuing convulsions caused by the global financial crisis are making National’s showpiece economic policy look less attractive with every passing day.

Yet as problematical as these issues are, they are minor compared with the massive challenge looming in the background, and which the government shows no inclination to confront. This relates to fundamental questions about who governs New Zealand, and for whose benefit.

The Maori Council’s challenge over water rights is symptomatic of a much wider grab-a-thon in which “Maori” interests are aggressively asserting rights to assets and resources with little regard for the common good.

Tribes are almost falling over each other in their haste to lay claim to everything from aquifers to wind. In Auckland, a Maori statutory body, unelected and apparently accountable to no one, is demanding that ratepayers spend $295 million on a wish list that includes compulsory te reo in schools and bilingual street signage.

Some of the people behind these claims give the impression of being intoxicated by a heady cocktail of power and entitlement. Nowhere do they acknowledge that we have a shared history, a joint stake in the land and a common interest in its future.

The process is aided by a Waitangi Tribunal whose makeup is fundamentally flawed. Twelve of the tribunal’s 24 members have iwi affiliations and most of the others either come from academic backgrounds – hardly a guarantee of neutrality, given the political leanings of most academics – or have a history of legal advocacy on behalf of Maori. It would be unnatural if this didn’t predispose them to sympathise with Maori claims.

What is perhaps most striking about this unseemly scramble for assets is that it’s based on the false premise that New Zealand consists of two races, “Maori” and the rest.

I use those inverted commas deliberately, since there is no legal definition of a Maori. Under a law change in 1974, “Maoriness” became a question of cultural self-identification. If you feel you are Maori, then you are.

Many of the most belligerent activists have European surnames (or did, until they created Maori versions) and decidedly European features.

The intriguing question is why so many people with a mixture of European and Maori blood choose to identify exclusively with their Maori forebears. No matter how much they might wish to, there’s no escaping the fact that their European ancestors were complicit in the injustices suffered by their Maori ancestors for which they now demand redress.

This inconvenient irony goes unmentioned in the endless race debate that saps New Zealand’s energy, sets the minority against the majority and constantly distracts politicians from the crucial business of ensuring a prosperous future for all New Zealanders.