The Supreme Court has warned the Maori Council it needs to prove the government's ability to recognise Maori interests would be restricted if Crown assets were partially sold.
Chief Justice Dame Sian Elias told council lawyer Colin Carruthers QC this morning he needed to prove the "mechanisms" available to provide recognition for Maori are no longer sufficient if a third party is introduced.
Mr Carruthers says there is an acknowledged claim by Maori to water resources and he argues the sale will deprive the Crown of the ability to provide Maori with an opportunity for a measure of control over their own water resources.
"The assets being disposed of are the shares. But effectively it is the control of those assets," he says.
He wants the Supreme Court to rule the government's partial asset sales programme unlawful until the Crown puts in place protective measures for Maori.
The two-day hearing is before Chief Justice Elias and Justices John McGrath, William Young, Susan Glazebrook and Robert Chambers.
Mr Carruthers says nothing in the appeal "challenges the supremancy of parliament".
However, he says in this case parliament has expressly stated all relevant powers and discretions must be "exercised in a manner consistent with the principles of the treaty".
The Crown denies privatisation will impair its ability to recognise Maori rights and interests in water resources, he says.
"The claims, they say, are to ownership of the water resources. Meanwhile, what is being sold are merely shares in companies that own power stations which happen to use those water resources.
"Shares are financial instruments and therefore fungible. So, in selling shares, the Crown, it says, loses nothing that cannot be replaced in the future."
Justice Glazebrook asked Mr Carruthers whether selling just 49% – a minority – of the assets would make a difference. "Selling 49%, the asset doesn't really go to private interests, does it?"
Mr Carruthers says the transfer of shares will result in the impairment of the Crown's abilities. It would be unable to deal with river consent issues easily and would instead need to consult with the private shareholders.
The Crown, he says, relies on three mechanisms, including Maori traditional rights to rivers and geothermal energy and its engagement with iwi to protect future treaty claims.
At present the Crown can exert considerable control over the state-owned enterprise but this control will "signifcantly diminish" once each SOE is turned into a MOM (mixed ownership model) company.
"Giving Maori direct and meaningful involvement in the power-generrating SOEs after privatisation will not be possible.
"Power companies presently pay nothing for the use of the water resource. The privatisation is taking place in the context of this 'zero cost for water'. The privatisation is, as a matter of policy, targeted at selling shares to mum and dad investors.
"The Crown will be creating a large body of ordinary New Zealand citizens with a financial interest in preserving the status quo of zero-rated water resource use."
He says any change to the zero rating to recognise Maori proprietary rights may financially prejudice the power-generating SOEs and therefore the return to private shareholders.
It would inolve doing something the Crown has always been unwilling to do – implement a settlement which interferes with private property rights.
QC David Goddard's Crown case may begin later today.
This article is tagged with the following keywords. Find out more about MyNBR Tags
- Joyce associates openly talking about leadership change
- Tech expert's complaint about 'snake oil' ad upheld
- Fonterra says farmer loan support package will cost $390 million
- iPredict decision the work of 'officious aliens' – Crampton
- Parent, widow of Pike River casualties fail to force review of decision to drop charges against Whittall
Most listened to
- Tim Hunter on why Veritas is doing it the hard way
- Matthew Hooton on whether Steven Joyce will be the next national leader
- Rodney Hide on why all city planners should be fired
- Nevil Gibson discusses his latest Editor's Insight on films
- The NBR crew throw around some of the week's top stories
- Rob Hosking breaks down the political and economic week that was
- "A tragedy" - David Farrar on his disappointment with Simon Bridges
- New F&P product pipeline exciting, says Macquarie senior investment adviser Brad Gordon
- Taupo Motorsport Park executive director Tony Walker on the park's rebranding
- NZIER senior economist Christina Leung on why she does not think the OCR will hit 2%
- NBR's Cameron Officer talks about the NBR Car of the Year 2015
- John Barnett on Brewer: ‘Boy, has he got a bit to learn’