Local Government (Rating of Whenua Māori) Amendment Bill

on behalf of the Minister of Local Government: I present a legislative statement on the Local Government (Rating of Whenua Māori) Amendment Bill. I move, That the Local Government (Rating of Whenua Māori) Amendment Bill be now read a second time.

Māori land is taonga tuku iho and it is fundamental to the cultural and economic wellbeing of Māori. The approach to the rating of Māori land has resulted in barriers for landowners to achieve their cultural and economic aspirations. There are also significant inequities in the current ratings system as it applies to Māori land. As the Minister, the Hon Nanaia Mahuta, said when she introduced the bill to the House, this bill implements measures to remove rates as an impediment to the use and development of Māori land by its owners.

The legislative changes to the rating of whenua Māori is part of a wider programme to support Māori land owners, trustees, and whānau to realise their aspirations for Māori. It works in conjunction with other Government initiatives, such as Te Ture Whenua Maori (Succession, Dispute Resolution, and Related Matters) Amendment Act, which we passed in the previous Parliament and that will simplify some of the legal process requirements that Māori land owners face—also, the investment of $56.1 million in Budget 2019, enabling the establishment of regional, on-the-ground advisory services in Te Tai Tokerau, Waiariki, and Te Tai Rāwhiti; also, the creation of a whenua knowledge hub and the Tupu New Zealand website that the Minister launched in February last year; and also new and enhanced services for the Māori Land Court and the modernisation of the Māori Land Court information systems that the Minister worked with the former Minister of Justice on as well; and also the provision of feasibility and investment funds for Māori land owners, through the Whenua Māori Fund; and, finally, $100 million set aside from the Provincial Growth Fund for the development of whenua Māori.

I’d like to thank the Māori Affairs Committee for its work on this bill. The committee has made a number of helpful suggestions that will improve the operation of the bill once passed by this House. I also wanted to thank the local authorities for their positive response to this bill. It’s notable that local authorities’ submissions support the bill and recognise the need to modernise legislation in this matter. Most importantly, I want to acknowledge all the submissions on the bill, from whānau, hapū, and iwi throughout New Zealand.

Rates are a difficult issue for Māori, since the payment of rates has been a factor in the alienation of their whenua. However, submissions from Māori acknowledged this bill is a step in the right direction. This bill will eliminate the problem of rates arrears accumulating on land that the owners derive no economic benefit from. The bill will also make non-rateable Māori land that is subject to Ngā Whenua Rāhui kawenata—this is Māori land that is, effectively, part of the national conservation estate, protecting our biodiversity. By reducing the burden of rates arrears, the bill will enable owners of Māori land to discuss development opportunities with their council without the fear that they’ll first be asked to pay rates arrears. The bill will enable homeowners to choose to be rated individually, simplifying rates payment and collection. This will also enable low-income homeowners to access rates rebates where there are multiple homes on one plot and remove institutional discrimination against those homeowners. The bill will stop any further alienation of Māori land that was arbitrarily reclassified as general land in and around 1967, without either the consent or knowledge of the owners. The bill will provide owners of Māori land with a statutory right to seek rates remissions to support development on their land. All of these things bring the ratings situation for Māori land closer to our expectations of what a healthy relationship between the Crown, local authorities, and Māori should be.

It’s important to acknowledge that the objectives of this bill are more important now as we consider the economic impacts of COVID-19 on Māori employment and economic opportunities. The aim of this bill is to support the use and development of Māori land according to the wishes of its owners. Enabling owners of Māori land to use and develop their land will support the economic recovery from COVID-19 and will help employment in the regions, where Māori land is concentrated, such as Te Tai Tokerau, Tai Rāwhiti, Waiariki, and elsewhere in New Zealand. Enabling more homes on Māori land will help address our housing challenges and enable Māori to contribute solutions to these problems.

Finally, I just want to note for the House that this is the third bill this Government has brought before the House in recent times that address rating powers—the other two being the Urban Development Act 2020 and the Infrastructure Funding and Financing Act 2020. I’ve tabled a Supplementary Order Paper to be considered at the committee stage of the bill’s consideration. These proposed amendments are to ensure consistency across all three Acts in their application to Māori land. On that basis, I commend this bill to the House.

The legislative statement is published under the authority of the House and can be found on the Parliament website. The question is that the motion be agreed to.

It’s my real pleasure to stand and take a call and to speak to this bill, and I do want to say from the beginning of the call that National will continue to oppose this bill. I do want to actually outline the reasons why we’re opposing, because when you actually look at this bill, there looks initially to be some merit in it, but upon closer examination, when you start to unpack the component parts of it, there really isn’t that much in it at all.

The reality is that we fundamentally need a much better and a much more comprehensive piece of legislation to help us realise the goal of greater utilisation and productivity of Māori freehold land. We fundamentally believe that’s a great goal. We buy that logic incredibly well here in the National Party. But I want to talk about those two stated goals that the Minister alerted us to before, which is really that this bill is supposed to be about the facilitation and the development and to encourage greater utilisation and, ultimately, occupation of Māori land, and it’s also modernising some rating legislation in how it affects Māori land. If I can just take both those goals, I’ll actually start to unpack them a little.

As I said, the goal of improving the utilisation of Māori land and improving its productivity is something that the National Party totally supports. We really buy into that. But on this side of the House, we know not just in the Māori economy, but in the general New Zealand economy, that this country for the last 30 years has been suffering from a productivity disease. We are deeply interested in that, and we care deeply about that, because we know that improving productivity is the single biggest thing that we can do to raise our collective standard of living. When you look at the facts across New Zealand—outside the Māori economy, just for a moment—we are one-third lower than the OECD average in terms of labour productivity and that’s been steadily declining, and that’s a big problem. So we have to work smarter. We have to work much harder and realise those productivity gains to get our standard of living up to the standard of services that we want to be able to support going forward.

Getting back to Māori land as a component of our broader economy. In that broader economy, we know there’s 1.4 million, or 5 percent of this land that’s tied up in Māori freehold land. We know it’s often isolated, we know it’s often lower quality, we know it’s underutilised, but we do believe there is much more potential for them to realise from the ownership of this land. We do agree with the broad intention of the bill, as I’ve said earlier, about utilising better ways of using that land, because if we could turn it into crops, if we could turn it into honey or forestry or housing, that will in turn strengthen whānau and actually strengthen the productivity and the value of those communities.

Disappointingly in this bill, there has been no examination of the impact that this bill will have on general land owners as well. I think that’s a shame, because if we’re all signed up to that collective challenge of improving New Zealand’s productivity and the ability for us to generate enough cash to fund the lifestyles that we all want to live in, that’s a big problem. So we think we should all want to help improve the productivity of general land, not just Māori land, as well. That desire of wanting to improve it for all of New Zealand is important.

It’s not just Māori land owners who have unproductive land. It’s not just Māori land owners who own land collectively or may benefit from rates remissions, as the Minister just outlined. For example, if you think about it, there are many landowners—general land owners—across New Zealand who have, under the guidance of the Government’s stalled National Policy Statement for Indigenous Biodiversity, actually planted out huge tracts of land in indigenous biodiversity, which is then rendered unused and unproductive under the significant natural areas. Equally, under our freshwater rules that have been recently implemented, there are massive swathes of farmland that have been put aside around riverways that actually become unproductive for farmers as well.

If you think about it, there are plenty of property owners—general property owners—across the country who have planted out trees as part of an environmental initiative. They don’t get to enjoy the reductions in rates that we’re talking about and proposing here. There are plenty of general land owners who have large families who would like multiple dwellings on their property being treated as one single dwelling too, as we’re seeing in line with this bill here. So, as I said earlier, it’s not just Māori land owners who have unproductive land, who own land collectively, or who may benefit from rates remission. We just simply ask: why not allow all New Zealand land owners to benefit from the same flexibility? Why only apply it to Māori freehold land?

Now, if I can move to the second goal, which is really the discussion around ratings remission, and, really, in this bill, that is the central thesis: that if we can remit rates and write off rates, we’ll be able to unlock the productivity or realise productivity gains with this land. There are some really positive things in it. There are some good minor changes—things like getting clarity on the origins of Māori land; making sure there is no inadvertent sale of Māori land, which was classified from Māori land to general land under the 1967 legislation; enabling councils to do a rates remission at the beginning of a development so that there’s certainty around financial planning and consenting; and Māori land that’s tied up in the emissions trading scheme being exempted from rates as a result.

So those are some of the minor sort of tidy-up stuff, which is sensible, and it seems quite worthy and common-sense sort of stuff. The two major bits are fundamentally the ability to be able to take multiple land blocks and be able to treat it as one large block, or, likewise, to take one large block and to be able to separate it out into separate blocks. The reason for that is that it ends up lowering the rates, it ends up lowering the uniform charges, and it ultimately ends up being able to help people access rates rebates. That’s a good thing, because rates rebates have actually been not fully accessed across New Zealand.

The second thing that this bill does under the ratings remission bit is it really gives blanket authority and powers to the local council CEO to be able to write off those rates as they see to. I guess that’s the issue that I did want to talk a little bit about, because the issue here is: “What problem are we actually trying to solve?”, because under the existing legislation today, councils across New Zealand can, in fact, write off rates as that stands. We’ve only got to look at our former parliamentary colleague, the former Mayor of Hastings, Lawrence Yule, who actually spoke about this piece of legislation in the first reading. I wanted to quote what he said. He said, “I’ve been a mayor where I’ve remitted those rates, so I know it can be done. I’ve been a mayor when we have put the uniform charges together on several properties, so the rates per property have been reduced. It can be done.”

That same point I think was really made well in one of the submissions from the Auckland Council, Maungakiekie-Tāmaki Local Board. In their submission, they said, “Nearly all the changes proposed are already delivered by Auckland Council through its rating policy and Māori land rates remission and postponement policy.” So, as I said, there’s a real issue there. Under existing legislation, you can deliver rates remission today. There’s nothing stopping councils, and councils are doing it. There’s creative solutions being developed in the Far North in terms of how councils are dealing with arrears of rates and incentivising the right behaviour going forward for rates payment.

As an aside, I’d just say that there’s been no financial impact, that I’ve been able to read, around this bill to say what the actual costs of writing off these rates will be for local government or central government. I think it’s important to just log that when you start writing off costs and revenue, you narrow the rating base, and ultimately you’re shifting the cost burden to other ratepayers to pay. I just don’t think we’ve, fundamentally, had that conversation to address it.

So I guess the bottom line, fundamentally, is that the ability to write off rates is already available currently, in the current law. I’m actually struggling to understand what is so fundamentally revolutionary about this bill and what it is expecting to fix. I think when you strip it down and you actually look at it really closely, it’s very narrow. It’s doing very little and not comprehensively solving the problem or realising the opportunity. The thesis of the bill is flimsy. It’s basically just saying that Māori land productivity can be improved solely through a rates write-off, which actually can be done today under current legislation. So the problem isn’t actually being solved, and I think it’s a very junk food - like sort of bill, when actually what we really want is a substantive, proper, high-quality meal, and that’s what we kind of need.

I just want to say, you know, don’t worry about the incremental tinkering. We don’t despair, because here in National, we have the answer, and the answer, for us, is a fundamental repeal and replace of Te Ture Whenua Maori Act. I want to commend to the other side of the House this great member’s bill from Chris Finlayson. Chris Finlayson was the colossus of Treaty settlements, who actually believed in helping Māori realise their potential and got a lot of things done. He drafted a great member’s bill here, and my colleague Gerry Brownlee is taking it forward from here. But that’s the bill that we really need here. That’s the bill that fundamentally gets into the other components around this issue.

If you want to solve the issue and you want to activate and unlock and accelerate Māori productivity on this land, you need to look at things like owner and descent relationships. There’s none of this conversation in that bill. There’s ownership interests of Māori. What about collective ownership? What about whānau trusts? The dispositions of Māori freehold land—none of that has been discussed in this bill that we’re talking about tonight. The amalgamation and partition of land; the sale, gift, exchange, and mortgages; governance arrangements; court jurisdictions; governance bodies; administration of assets—all these things. You need a comprehensive solution if you really want to deliver it. If we keep doing it in a lightweight way, we’re not solving the problem.

So I just want to say to the House that National is actually going to oppose this bill. We want to encourage the Government to join with us and be bolder and braver and fundamentally unlock and accelerate productivity.

Tēnā koe, e te Māngai. Thank you for taking my call. The thesis of this bill is not, in fact, flimsy, as evidenced by the member opposite’s comments about why the Government should bring it into action and why, in fact, utilisation of Māori land is a good idea and is served by this bill. He asked, “How could we turn Māori land into crops, honey, and housing?” The answer is by enacting the provisions of this bill, which unlocks the potential of Māori land by shifting the dial in a sensible way to incentivise the governors of Māori land to create governance structures over Māori land so that their owners can benefit from it.

This is the bill which Māori land owners asked for, not the bill which is not before the House, which the member opposite has referred to. He also asked, “What problem are we trying to solve here? Some councils do remit the land rates arrears on Māori land.” However, that would ignore the countless litigation brought by Māori land owners to get to this point where councils remit those arrears—cases like the Mangatu Inc., which has land holdings the size of Auckland City, which has brought litigation over a period of 10 years to negotiate fair ratings systems with its council, which only applied to Māori land owners and was unfair.

This bill seeks to address that structural unfairness for Māori, and I commend it to the House.

Debate interrupted.