Yet another race based pay out

Shane Jones has impeccable timing. It is Waitangi Day this week, so he?s chucking money at M?ori to cheer them up.? You are mistaken if you thought that Shane Jones’s Provincial Growth Fund allocations were merit based.? They aren’t, because Jones didn?t get that memo. Quote.

The government’s Provincial Growth Fund will spend $100 million on supporting M?ori landowners to make better use of their land.?

  RadioNZ end quote.

What about struggling Pakeha landowners; wouldn?t they like easy access to development funding too? Quote.

Ms Ardern said 80 percent of M?ori freehold land is under-utilised and unproductive because the special status of some land makes getting loans difficult.? End of quote.

You could argue that the reason why their land is under-utilised and unproductive has nothing to do with funding, but Ardern is correct about the special status of M?ori land. Their collective ownership model is not the European model, and it’s not working well for them and so they are whining.

We should have seen this coming. The problem of Iwi agreeing is not new and is seen in drawn out treaty settlements. For example, Northland’s largest Iwi, Ngapuhi, have still not agreed on a mandate for settlement. After all these years.

If Ngapuhi had not squabbled about their slice of the Waitangi Treaty pie, they might already have received funding for development; so surely any payments to them should be deducted from a future treaty settlement? Quote.

Ms Ardern said the new funding is designed to kick start economic development in the area leading to jobs.? End of quote.

A simplistic view, Ms Ardern. Giving people money does not mean it will be spent wisely or fairly or that the investment will lead to jobs or will turn a profit.  Chucking money at a problem sometimes acerbates it. Why has treaty settlement money not been used for land development? Oh yes, the squabbling. Quote.

The money is to be spent on projects that are investment-ready.

Mr Jones said the biggest barrier to development of M?ori land has been lack of access to finance.? End of quote.

Ardern and Jones are saying that banks are reluctant to loan against Maori land held collectively. Strangely, the M?ori Land Court does not see this as a problem because their website indicates that the lending process is deceptively easy. Q ote.

A mortgage or loan maybe entered into by:

  • the sole owner of a M?ori land block
  • all the owners of a M?ori land block acting together
  • the trustees of a M?ori land block who are empowered to raise finance against the block
  • a M?ori Incorporation which holds M?ori land.? End of quote.

All bases covered regarding loaning against collective ownership, but what the M?ori Land Court does not spell out are the problems if the investment fails. The sale of M?ori land is restricted by the Te Ture Whenua Act 1993 S164 making M?ori land only re-saleable to M?ori.  This fact plus the borrower?s inability to service the loan due to squabbling parties, makes banks nervous. No worries here for the CoL government though, nor is there any thought of getting rid of this very unworkable ownership model.

M?ori landowners also get rates breaks. It’s not strictly kosher but, if they don’t pay their rates, the council has no choice but to write their rates off simply because they can?t foreclose on their land, as would happen with non- M?ori owners; however the bank of the CoL government has no such qualms.

M?ori simply can?t lose, getting their own special rights as well as hanging on to their land even if their investment fails. Wouldn’t the rest of us consider ourselves lucky to receive funding for a virtually risk-free project? Instead, we miss out on money that could have been better spent.

If you get cancer and don;t have health insurance you miss out on the expensive but effective new drugs that Pharmac doesn’t fund. This squandered money could have gone into public health and saved the lives of a few more cancer sufferers or improved the lot of teachers and nurses, or on any other infrastructure needs that all would benefit from.