Mark Solomon on asset sales

Ngai Tahu’s Mark Solomon joined Kathryn Ryan today in discussing asset sales. Here’s the link. Solomon outlined Ngai Tahu’s thinking on asset sales (as well as the broader Iwi leaders position). I found the following quite interesting: Solomon informed us that at the beginning of National’s first term he and other iwi leaders, by other iwi leaders I assume he means Tuku Morgan, met John Key, Bill English and other senior members of Cabinet. Presumably they met to talk about treaty settlements (relativity clause maybe?) and broader Maori issues. It should be noted the iwi leaders were accompanied by Pita Sharples which indicates that the Maori Party were working to open doors for iwi. Then again I think Ngai Tahu have used Saunders Unsworth in the past so it could be their work. Anyway, in the discussions Key said the government was cash strapped. In response Solomon put forward the idea of asset sales. Apparently he was rebutted with Key informing him that asset sales are off limits in the first term, however Key (or whoever) indicated their willingness to explore the sales in the second term. So it appears that iwi were interested in asset sales before the idea was floated publicly, or at least confirmed publicly. I think this is interesting.

Rino Tirikatene pointed out last night on Native Affairs that iwi should be exercising some entrepreneurial thought rather than relying on the government floating safe assets for them. I agree.

Solomon also acknowledged during the interview that individually iwi cannot hope to become major players; however Solomon holds that iwi can become major players as a collective. He argues iwi could obtain between 10-15% of any assets. This is optimistic, especially given Ngai Tahu’s position as a major infrastructure investor in Christchurch. I don’t think they have the ability to dip into state assets as well as infrastructure in Christchurch. The only other iwi with the financial clout to participate is Tainui, but they’re sinking a lot of money in to other commercial ventures like shopping malls (Te Awa, the Hamilton CBD etc).

Solomon, who I should note seems to be leading the asset sales charge instead of Tuku, believes iwi are the perfect buyers. Long term investors with exclusive interests in New Zealand. This is hard to argue with I guess. However, the other arguments against iwi involvement in asset sales still stand. For example, asset sales will, in all likelihood, lead to a decrease in government services. Iwi, as “major” investors, surely have an obligation to negate the effects of decreased services on Maori. However, iwi don’t have the economies of scale (nor the experience for that matter) to provide what government once did.

Ngai Tahu, and to a lesser extent Tainui, are positioning themselves well. For example Tainui, apparently, own half of the Tainui CBD. Nagi Tahu are positioning themselves to take a similar position in Christchurch. In fact Ngai Tahu own large tracts of the South Island (including many rural stations). The next step is for iwi is a slice of New Zealand’s strategic resources. Power companies are the obvious, and cheapest, choice. The first step essentially. I wouldn’t be surprised to see Ngai Tahu make a move for a stake in Christchurch Airport. Tainui already own and operate the only hotel at Auckland Airport and the natural progression from there is a stake in the airport itself. Apparently Tainui’s biggest interest is in Air New Zealand at the moment.

Both Ngai Tahu and Tainui have a relativity clause. When they invoke the clause I think we could see them become huge players in the New Zealand economy.

"It will benefit Maori"

So Tariana Turia supports asset sales – it’s hard to see why. To rationalise her stance Turia claims asset sales could, key word here is could, benefit Maori. Iwi, particularly Mark Solomon, Tuku Morgan and FOMA, are also salivating over the possibility of getting their corporate hands all over our, key word here is our, national assets.

Turia operates under the notion that what is good for iwi is by definition good for Maori. This is not strictly true - especially in this case. The government is essentially selling future profit for short term gain.  We are told the immediate windfall from asset sales will be used to pay down debt. With this in mind it is safe to assume we will see a decrease in government services in the long run. Now the big question is will iwi step in and negate the decrease? Probably not. I doubt iwi have any desire to do so, and fair enough, but surely there is an obligation to do so. This is all about the people right? Surely if iwi were to engage in a rational cost/benefit analysis it would show Maori receive more value with the assets in government hands rather than iwi hands.   

Realistically, iwi will have a minority stake only. Even iwi katoa lack the capital to become major shareholders. So why bother when you will have no control over the direction of the company – especially decisions regarding price rises etc? In a previous post I wrote;

Iwi are now seeking neo liberal ends such as the right to exploit natural resources and the commodification of land and taonga. They also want to play a part in the privatisation agenda of the current government (e.g.private prisons, PPP etc...). It appears to me that iwi authorities have rationalised such goals by adopting the ‘trickle down’ philosophy. They seem to reason that Maori participation in the neo liberal experiment will result in indirect ‘trickle down’ benefits for ordinary Maori despite the trickle down theory been rather discredited.

This is all about iwi’s new found corporate agenda.

Turia is a great example of an indigenous corporatist so no surprises that she supports assets sales (along with private prisons). I’m not holding my breath but I do hope that she justifies her position. I’m sick of the Maori Party, and iwi for that matter, supporting something which is clearly fucking stupid without any reason besides “it will benefit Maori”. How? Why? When? Get your act together.