David Round: Questions of Water Rights and Ownership

Water! Cool clear water. Adam’s ale, the first and most delicious drink of our ancestors; the water of rebirth, the cleanser, the gift of life itself. And in our own over-populated, drying, increasingly desperate days, ‘the new oil’. 

Some of us may remember the film Chinatown, directed by Roman Polanski ~ that takes you back a bit ~ with a plot hingeing around the huge amounts of money to be made by manipulating the Los Angeles water supply. The story was not implausible. 

We have all seen the photographs of privatised water from northern California, sold to southern cities, flowing hundreds of miles past parched cracked farmland to fill urban swimming pools and to water urban lawns. But the pools and lawns are disappearing, for California, as we are now learning, is in the fourth or fifth year of an unprecedented drought. Sao Paulo, in South America ~ population somewhere around twenty million ~ is perhaps even more desperate; the second or third year of drought, and water rationing is imposed in some places in the city for five days every week. 

   

We have had a drought ourselves, of course, in many parts of the eastern North and South Islands. Even after this first and very early snowfall much of the South Island’s east coast is still worryingly dry; and if the snow presages a long and hard winter, as is not impossible, then it will not be much help. The Opuha Dam, in South Canterbury, was effectively empty a month or more ago, and its supply of water for irrigation had simply ceased.

   

Water is precious here too, then, not just in other countries. We are only waking up to this, because until recently we have always had more than enough to meet our simple needs, and so we have always taken it for granted. And what is precious is also ~ to use a more prosaic, practical kind of word ~ valuable.  It is better than gold. Water is not just a pretty but useless metal; it is the basis of life itself.  Whoever controls water controls us; in a time of shortages he will have his hand at our throat.

  

So it is hardly to be wondered at, then, that Maori want to get a slice of the action, and that a ‘research group’ called Sapere ~ to know, or to understand, in the Latin tongue; a good name, even if there will inevitably be a tension between the demands of pure scientific investigation and the desires of their particular clients ~ Sapere, anyway, was commissioned by the Iwi Leaders Group to do some research. And what they have come up with, you will not be surprised to hear, are some recommendations, based no doubt on the most disinterested and undisputed scientific principles, recommending a nationwide ‘settlement’ of Maori water claims ~  a settlement that some have already called a ‘Waterlords’ deal. That name, of course, comes as a conscious echo of the Sealords deal about fisheries; but the name is also, it seems to me, deeply prophetic. The masters of water have a very good chance of being our new lords.

  

But before we go any further, a brief word of explanation about the administration of water in New Zealand. At common law there was no ownership of water; a landowner had the right to use the water that flowed over his land, but he was obliged to pass it on to landowners further downstream undiminished in quality or quantity. In 1967 Parliament made the Water and Soil Conservation Act, which, without going into questions of ownership, declared that except in certain pretty limited situations no-one could use any ‘natural water’ ~ which is all water, frozen, liquid or steam, not in a pipe, tank or cistern ~ without a permission ~ a ‘water right’ as it was called ~ granted by a regional water board. The Act gave absolutely no guidance as to what was to guide the board in the making of its decisions. That is pretty amazing when you think about it. Nowadays we have purposes and principles listed at length in statutes, and policies and plans galore. Less than fifty years ago our unsophisticated ancestors saw no need. There was obviously a general consensus about how to approach these things; that, and some understanding that there was so much water around that hard decisions would seldom be necessary. A simpler age indeed!

   

The Resource Management Act largely continued these arrangements. ‘Water rights’ were rechristened ‘water permits’, and are now granted and regulated by regional councils. As before, anyone can apply for one, and the order of priority is simply ‘first come first served’; a regional council does not weigh up the competing benefits and costs of different projects using the same water, but simply grants water ~ assuming water is available ~ to whomever asks first. Water permits last for a maximum of thirty-five years. There is no right of renewal, but holders of existing permits do have a certain priority when seeking a brand new permit for the same thing.

  

(You will recall that the Waitangi Tribunal now has no jurisdiction to investigate any ‘historical’ claim, arising out of events occurring before 1992. New Zealand’s current legal water arrangements were set up well before then, and so the Waitangi Tribunal’s very dubious ‘findings’ on water were simply beyond the Tribunal’s powers to make. But what does law matter?)   

   

I have to mention all this, because the question of Maori ownership of water cannot be separated from the bigger question of water administration generally. Water is a common good, heaven’s gift to us all. By the law of nature and, hitherto, by our own human laws, it has been, essentially, common property. Yet it must be allocated to individuals for their and the community’s use and benefit. How is this to be done? At present the law strikes the compromise of granting individuals a permission to use a portion of this common property for a certain period of time. The ‘water permit’, although no longer called a ‘water right’, is nevertheless a right to use water. It is a valuable piece of property. Possession of one might double the value of your farm.  

  

The present system, though, is not without disadvantages. Although there may be administrative charges, no-one is charged for the actual water he or she uses. Although we might well object to charges for modest household use, it does not seem unreasonable that major users making major profits should pay. The absence of payment for water encourages over-use and waste. Then again, the ‘first come first served’ principle means that water is not necessarily allocated to its most efficient end-use. The first one in the queue seeking a water permit from the regional council might be a farmer using large quantities of water to produce so many dollars worth of milk. That same amount of water, or even less, might be able to produce many more dollars worth of something else ~ wine, say, or seed crops. But the water is not available for these other uses because the dairy farmer was first in the queue.

   

So the suggestion has been made that water rights should be ‘tradable’ ~ that one should be able to buy and sell them. That way, the dairy farmer has an incentive to use ‘his’ water thriftily and sell the excess to the vineyard owner, or even to sell all his water to the vineyard. The expected eventual result is that over time the water would end up in the hands of those who use it with the greatest economic efficiency.

    

In fact, such trading is actually possible under the Resource Management Act right now, with the consent of the regional council or under its plan. You may have seen a recent Campbell Live programme about a foreign-owned bottling plant on the Heretaunga Plains sending to China huge amounts of water that could be used for orchard irrigation. The bottlers purchased their water permit from a previous owner. And the bottlers do not pay for the water itself.  

   

But that tradable approach also has its problems. For one thing, many water bodies in New Zealand are not just fully allocated but actually over-allocated. Incompetent administrators have over the years granted water permits for more water than the river, aquifer or whatever actually holds. They were able to do this because many of the permit holders did not use all the water they had asked for ~ so the river still appeared to have plenty of water in it which could be allocated to someone else. As long as all the permit holders do not use all their allocation, that might not present a problem. But once permit holders begin to sell off the unused portions of their allocations to other people who are paying good money for something they do intend to use, it will suddenly be discovered that there is not enough water to go round.

  

Even when there is not over-allocation, though, most of our water resources are pretty well fully-allocated; all the water in the river is allocated to farming, hydro-electricity, the biological life of the river itself, and so on. And so the question immediately arises ~ if Maori were to be given any allocation of water, where would it come from? Would there be a confiscation or compulsory purchase of existing water permits? (Unlikely, surely.)  Or would water charges be imposed, with a proportion of the charges being siphoned off to Maori? (Ah! Rather likelier ~ the effect of many Treaty settlements, after all, is to establish a new parasitic rentier/landlord class, clipping the ticket on other people’s labours.) Or would there be some sort of preference given to Maori when water permits were renewed and new ones granted? (Which water permits could then be on-sold, with ticket-clipping again occurring. Or perhaps not; perhaps all our water might end up in the hands of a surly racial minority.)   

  

For another thing, once we have tradable water rights then, as the Campbell Live programme illustrates, we open ourselves to the California situation. ‘The most economically efficient end-use of water’ sounds innocent enough; but what if that means bypassing parched fields to serve unsustainable cities? What if a private water permit owner were to decide that it was most profitable to sell pure New Zealand water overseas, rather than let anyone in our own country have any of it? That would be appalling; yet it is what is happening with the Campbell Live bottling plant, and it is merely the logic of the marketplace and tradable property rights.

   

Indeed, tradable water rights really only work effectively if water is fully privatised.  If you are going to buy the right to use water, you do not want that right to disappear in a few years time when the water permit expires. It could surely be argued that given the short time horizons of most business decisions, a thirty-five year term and priority in obtaining a new water permit would have been security enough. But the more security the better, from a private point of view; especially if your use or abuse of that formerly public resource is going to be unpopular or controversial in future….

  

The new model proposed by the Iwi Leaders Group and the Sapere report will not solve the Campbell Live problem. In fact, it will formalise that misuse of water as part of our law forever. The report  proposes not only a ‘nationwide settlement’ of the highly dubious Maori water claim but also a change from 35 year consents to permanent ones, and a market in tradable water rights. So rights to water would last forever, and be private property like anything else; and so a treasured public resource fundamental to life itself moves towards control by a handful of ~ who knows who they will be? But their administration of water will not have the public good as its primary aim.

   

The report, then, proposes not just the gift to Maori of some part of existing water arrangements, but also a fundamentally new arrangement for all water.

  

There are two things to object to, then. It would be bad enough to give away yet another part of our family silver to one racially defined segment of the population; especially when we know perfectly well that ordinary Maori are not going to benefit from yet another gift to what Chris Trotter has just described as ‘elite-brokered, ostensibly iwi-based ‘neo-tribal capitalist’ corporations…functionally indistinguishable from the foreign and pakeha-owned corporations in whose interests New Zealand politics is now transacted’. Any water ‘settlement’ will be just another gift to the new fat cats.

  

(Chris Trotter adds that ‘[t]hese neo-tribal capitalists have grown exceptionally skilled at masking the commercial imperatives that are their true raison d’etre behind the rhetoric of reparation and redress. How else could God’s rain have become the Iwi Leadership Group’s private property?’)

  

No principle of justice, no events of the past, real or spurious, oblige us to privatise public assets and replace white capitalists with brown ones.

   

But ~ the second thing ~ what the Iwi Leadership Group is demanding is not just an unwarranted share in the existing pie, but the creation of a completely new fully privatised pie, with very far-reaching consequences. Somehow the great cosmic understanding embedded in those fundamental concepts of aroha and kaitiakitanga  and love for everyone and all creation, all of us here on Papatuanuku, which have, for whatever reason, recently become more prominent in our understanding of Maori culture  ~ somehow this is slowly transforming itself into the idea that it would be best, then ~ most ‘appropriate’ ~  for the particular traditional kaitiaki to look after everything on everyone’s behalf, because they know how to do it, and they will of course extract appropriate administrative expenses, and the white folk will just sit nervously by hoping that there will be a bit left in the pot by the time they come to be served. There will have to be more than just Maori private owners of course, to start off with anyway, but there will be plenty of other willing investors from big powerful countries. New Zealand water will be a gift to the world, a prize to be coveted and bought and sold far away from our native hills…but too bad for those of us who just live here.    

   

What does the government think? It is equivocating. Dr Smith, Minister for the Environment, ‘does not accept that Maori have any preferential first right over either nutrient or water allocation. So no notional allocation and no automatic right to 10 or 20 per cent for iwi.’ That is promising. But Mr English says that the Crown accepts ‘the general principle that iwi have rights and interests’, and Dr Smith says that the government’s view is that Maori rights and interests in water could be addressed ‘by an effective voice in the process, catchment by catchment’. What might that mean exactly? Handing things over to regional councils, never the sharpest knives in the drawer, for a bit of private bullying and blackmail? I fear the worst.  

  

We are just at the beginning of a very long argument here, and clear conclusions are impossible. I leave you, though, with two thoughts. First, if we are unhappy about privatisation of water to Maori, then we should be unhappy about the privatisation of water generally.  We must not be racist. If privatisation to private profit-making institutions and organisations is acceptable, then Maori are just as entitled to own water as any other private person. We may object to them getting the water without having to pay for it like everyone else, but that is as far as our objections can go.

   

And second, if we are really concerned about this wonderful gift of water, we should all be taking greater care of it than we do now. We might be able to quibble about one or two of the details, but many of New Zealand’s water bodies are a disgrace ~ filthy, undrinkable, unswimmable, unfit for living things, often hardly existing at all after much water extraction. To judge by the state of many of our waterways, we could not be thought to care much about water at all. If we are going to care, let us do it properly.