Saturday, October 9, 2010
Mike Butler: Ngai Tahu, charity, and the land
He said that “these all appear to be business enterprises that have managed to be registered as charities and hence gain tax exempt status”, and asked “can this really be so? Do none of these companies pay tax? If so they have a considerable competitive advantage and it must be difficult for other fishing and tourism companies to compete.”
Ngai Tahu were awarded $170-million in 1997 to settle the tribe’s Treaty of Waitangi claim over 19th century land purchases.
From 1844 to 1863 Ngai Tahu sold their lands to the Crown in a series of nine purchases. The largest of these was the Canterbury purchase of 1848, negotiated by Henry Tacy Kemp, which saw 20 million acres (about 8 million hectares) sold for £2000. The other principal transaction was the Otago purchase of 1844: 400,000 acres (about 162,000 hectares) sold for £2400.
The Tribunal noted that it “cannot avoid the conclusion that in acquiring from Ngai Tahu 34.5 million acres, more than half the land mass of New Zealand, for £14,750, and leaving them with only 35,757 acres, the Crown acted unconscionably and in repeated breach of the Treaty of Waitangi".
Ngai Tahu have argued that the purchase price not as a properly assessed market value consideration in the European concept but rather as a deposit; a token, a gratuity.
Nowhere in the Ngai Tahu Report 1991 summary, nor in the tribe’s claim history, is there any mention that in 1944 that the first Labour government passed the Ngai Tahu Claim Settlement Act, which awarded Ngai Tahu £300,000, payable at a rate of £10,000 a year for 30 years. This was less than the recommended £354,000 of the royal commission, whose findings had always been contested by Ngai Tahu. Nevertheless, the act was passed with the intention of making £300,000 a full and final settlement of the Ngai Tahu claim.
Mention of a full and final settlement would have made selling the 1997 deal more difficult, although analysis of the figures shows the total comes close to the price the government sold land for 170 years ago.
The passage of time, that changeover to decimal currency, and inflation render the stated amounts meaningless. Therefore, I have created a conversion to put it into 2010 dollars. A court interpreter was paid ₤91-5s a year in 1845, the minimum wage sought in 1945 was £5-10 a week or £265 a year, while the minimum wage in 2010 amounted to $510 a week or $26,520 a year.
Therefore £14,750 in the mid 19th century was equivalent to 162 wages at the time which when multiplied by $26,520 in 2010 dollars, gives a total of $4.29-million. The full and final settlement of £300,000 in 1944 was roughly equivalent to 1132 minimum wages of $26,520 in 2010, giving a total of $30.02-million.
What would be the fair market value of 34.5 million acres in the mid-19th century? Fair market value is an estimate of the market value of a property, based on what a knowledgeable, willing, and unpressured buyer would probably pay to a knowledgeable, willing, and unpressured seller in a real estate market. But with the government the only legal buyer pressing semi-willing uneducated Maori to sell, there was hardly a fair market.
In 1840, the New Zealand Company sold land for £1 an acre until the fledgeling colonial government sold it to settlers for five shillings, or one quarter of £1, an acre. Harassment from disgruntled Maori inhabitants in some areas meant that often the land could not be developed, rendering much of it worthless at the time.
And the price paid for 34.5 million acres of the South Island? More than worthless but much less that five shillings an acre – £0.0004 an acre, or less than one penny an acre.
And what was the total compensation in mid-nineteenth century pounds? The 1997 payout of $170-million, plus $30.02-million in 1944, plus $4.29-million (£14,750) totals $204-million, or 7703 annual wages of £91 which equals £701,063, divided by 34.5-million (acres) equals £0.02, or about four shillings an acre – not far from the five shillings an acre used by the colonial government as the price to sell land to settlers in 1840.
at 2:59 PM