Government cowardice over water rights is damaging the environment

Gareth MorganTreaty

Speech to Maori Council, Waitangi, Feb 5th  2015

Over the last month we have released a book, written four articles in the NZH, and delivered 4 speeches – all of which present conclusions we’ve come to as a result of a 5 year study into the place of the Treaty of Waitangi in contemporary NZ society – actual and optimal. You are bound not to agree with all I’m saying, but if we are able to use this opportunity to give some additional energy to getting the treaty at last in its rightful place in our constitution, then NZ will have completed a journey that no other nation on earth has managed, making our home a model of social best practice.

In summary, these are the conclusions I have reached:

  • The treaty is about far more than making good on breaches, and negotiated settlements for wrongs. It is a formal acknowledgement by the State that Maori have unique and permanent rights in NZ society.
  • The treaty has yet to be fully honoured despite recognition by successive governments, the courts and government-appointed bodies such as the Waitangi Tribunal and numerous SOEs and government agencies.
  • Maori aspire to achieve rangatiratanga – as per Article 2 of Te Tiriti O Waitangi. Rangatiratanga in essence includes
    • The right of Group Maori to self-determination. This right for indigenous peoples is reiterated in the 2007 UN Declaration of Rights of Indigenous Peoples, to which NZ is a signatory
    • The eradication of any bias in socio-economic disadvantage particular to Group Maori
    • The right to political power, insofar as the limits of Article 2 extend and the equality of citizen’s rights outlined in Article 3 isn’t breached. In other words the political rights have well-defined limits.
  • The issue of restoring the mana (or pride) of Maori, after the beating it has taken, is significant. Maori must be able to walk tall in this land, just as non-Maori New Zealanders must be able to. On restoring of mana I suggest,
    • Renaming the country Aotearoa New Zealand, an increasingly common usage these days (witness the Constitutional Review Panel’s report).
    • Redesign of the flag to incorporate the bicultural nature of NZ, with Maori having direct input into that process
    • Making te reo compulsory in primary schools as a way to help youngsters understand our history, our bilateral nature and to be able to walk comfortably in both worlds
    • Establishment of an Upper House of parliament that is 50/50 Maori / non-Maori representation but must have a 75% consensus when recommending parliament reconsider legislation – and does not have the right of veto over parliament.
  • Work quickly towards hard-coding the treaty in the constitution so as the affirmative actions or positive discriminations currently required to mitigate the damage to Maori from not complying with the treaty, are no longer necessary. Once this is achieved we could look at a New Zealand that more accurately meets the requirement of Article 3. Such affirmative actions that need to be made obsolete include
    • Maori seats in parliament (as recommended by the Royal Commission into Electoral Reform that recommended MMP)
    • Maori wards on local councils
    • Quotas for Maori in tertiary education institutions

So that’s where I’m up to – in terms of release of ideas to the popular media. Today I want to talk about water – firstly, from the perspective of a Conservationist who also happens to be an economist; then from the perspective of honouring Article 2 of the Treaty; and finally reconciling the two approaches and recommending an approach for policy.

The Conservation Challenge

Of all environmental issues, freshwater quality is the one that New Zealanders are most worried about. Lincoln University regularly surveys the public. Results from 2013 reconfirmed that of all the natural resources in NZ (air, vegetation, water) the public believe rivers, lakes and marine fisheries are in the worst state.

In 2014 the government released its NOF (National Operating Framework) for the management of water quality in our waterways. This was the result of a long process, involving many advisory groups including the Land and Water Forum.

But at the end of the process the government’s announced “bottom lines” for water quality were pretty underwhelming and in short allow for a substantial further deterioration of the ecological condition of our waterways. The label “fit to wear you waders in” as opposed to “fit to swim in”, was a fair popularisation of the timidness of the policy.

At Morgan Foundation we facilitated a discussion between the leading advisors who had been consulted by the government prior to arriving at its policy. Our idea was to see what the experts actually recommend prior to any political overlay being applied. The group included the technical experts from industry, Crown Agencies and Universities that the government relied on.

The conclusion of our science panel – that we published – was that the government’s policy would lead to substantial further deterioration in water quality. The scientists recommended using an overall ecological indicator – the Macroinvertabrate Index – to monitor the ability of every waterway to support life.

If this approach were adopted by government and implemented by Regional Councils then no river would be permitted to deteriorate further unless the local community gives specific approval. This is very different to the wishy washy government guideline which holds that taken together, on some sort of average, the waterways in a region won’t deteriorate further. The problem with that policy, and what makes it unworkable, is how do you compare the deterioration in one waterway with the improvement in another? It is just impossible to deliver on this policy guideline.

Now economists will always prefer governments to use the pricing mechanism to ensure water users fully bear the cost of the environmental damage they cause. That cost can be measured in various ways – the price could reflect the cost of repairing the damage that has been done, or it could reflect what a user is prepared to pay to pollute the water when there is a cap or upper limit overall on how much pollution can take place. You get to that price by issuing and auctioning off licences to pollute or take water out of the river for irrigation for example.

And when the discussion goes there government officials and Ministers immediately remind us that since water is a natural resource, creating mechanisms that produce a price for water is likely to trigger a treaty claim because under Article 2 tangatawhenua have an interest in freshwater resources.

It is my opinion, that it is actually the treaty claim that is deterring government from introducing adequate environmental protection mechanisms for freshwater, rather than government primarily just not being interested in environmental values or being sceptical of the ability of pricing mechanisms to allocate the rights to pollute.

So there is an interesting synergy between the ambition of conservationists to protect our freshwater for future generations, and the ambitions of Maori to have it recognised that freshwater is a natural resource and hence falls fully under the carve-out provisions of Article 2 wherein Maori has a unique “property” or “ownership” interest. Of course under the concept of kaitiakitanga, wherein Maori’s preference in preserving natural heritage values falls, Maori has a second more direct synergy here with Conservationists.

So what we have is the government declaring that it has the right to determine water usage and abusage – on behalf of all the people of New Zealand. It is definitely vulnerable on that assertion from the perspective of the Treaty, but also – given that under the NOF – it is delegating that authority to communities, as represented by their relevant regional councils – it can be argued that it is not exercising that authority in a way that even reflects the views of all New Zealanders. It seems to be saying that the water quality issues in a region are not for the decisions of New Zealanders, but rather for the decisions of local residents only. Aucklanders have no rights for example, to have a say on the quality of the freshwater in Central Otago.

It all gets a bit messy when you consider that the South Island sends hydropower generated on South Island rivers to consumers in the North Island. Should a town like Cromwell be able to dictate to Auckland a limit on its power usage?

What to do? There really is no choice but to introduce mechanisms that produce a price for water instead of central and local government coming to better management glacially through regulation. Charging for water usage and damage is common throughout the world – of course even in NZ we already have domestic & industrial usage charges – despite no treaty settlement on water ownership.

The Whanganui River has just been established as a separate entity with which iwi and hapu have an inalienable relationship. In other words the river owns itself and $30m has been settled to parties who have an interest in the river – iwi, local councils and community to care for it. The Waikato River Guardians is another body established to protect the health of the river. But these bodies are not there to ration water use, nor to recognise Maori customary use. So the unresolved issues remain (a) how to efficiently allocate water rights and (b) how to internally price water pollution so you prevent further degradation as opposed to spend money cleaning it up.

From a Conservation perspective we need a coherent national freshwater pricing strategy. From an Article 2 perspective the ownership interest in freshwater by Maori needs to recognised, negotiated and settled. It’s analogous to the fishing quota. Until that day we have an ad hoc water management approach, with little to no effective safeguards to prevent the further deterioration of freshwater quality. Currently it is treated as just another extractive resource activity and to hell with the environment – users certainly don’t pay.

What the redeeming arguments are for such a regime escape me. I can only imagine the current approach is with us because once again, politicians with an eye on votes will not grasp the nettle, and solve the problem. The policy tool is well known – what is lacking is political will. Meanwhile our water quality keeps declining.

And of course the government isn’t the only body with big issues when it comes to freshwater. Maori themselves have significant conflicts given they have interests that range from environmental guardianship, to customary use and now – with the establishment of commercial arms, commercial use interests.

If the general principle then of implementing a conservation policy wherein a waterway is not allowed to deteriorate unless the local community gives specific permission, the definition of community becomes relevant – is just “the locals” or do Maori have a specific interest? My pick is that will be the latter so those interests need to be defined – especially customary and guardian interests.

I don’t see why Maori commercial interests should be treated differently to anyone else and they should pay full restitution costs for any environmental damage inflicted.

Then we come to the revenue side of fees charged to waterway polluters or users. I’d have thought these are not necessarily profit centres for government, local authorities or Maori – but seek only to ensure that the full cost of damage is paid and that the most economically profitable usage gets priority, at least after the public’s utility has been served.

It seems to me there is a way through here that is sympathetic to the national interest, defined as the country’s economic benefit, the community’s well-being, tangata whenua’s guardianship obligations, and its customary rights, and finally allocating commercial rights to the surplus in the most economically efficient manner possible via the price mechanism.

But it does require government to jettison the arbitrary mechanisms that describe water usage and damage policy across the country today, let alone introduce more binding bottom lines on water quality.

Government cowardice over water rights is damaging the environment was last modified: December 15th, 2015 by Gareth Morgan
About the Author

Gareth Morgan

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Gareth Morgan is a New Zealand economist and commentator on public policy who in previous lives has been in business as an economic consultant, funds manager, and professional company director. He is also a motorcycle adventurer and philanthropist. Gareth and his wife Joanne have a charitable foundation, the Morgan Foundation, which has three main stands of philanthropic endeavour – public interest research, conservation and social investment.