OPPORTUNITY LOSS

Last week I continued sharing the 2012 BERL report about the economic impact on Ngāti Kahu of land loss as the result of colonisation and land seizures up to 1865 and introduced the concept of quantifying the cost to Ngāti Kahu of lost opportunities by considering three counterfactual scenarios that could have produced credible outcomes in which Ngāti Kahu could have benefited from those opportunities.

Scenario one looked at what could credibly have happened if, instead of being seized from us, the land was sold by Ngāti Kahu for its full value, and the additional value gained, namely the £39,919 at 1865, was put on deposit, or in low-risk, long-term government bonds from that time until the present.

Essentially, BERL found that the additional value which Ngāti Kahu would have received had the land been sold at full value would have accumulated an additional sum of £ 39,919 by 1865.  If Ngāti Kahu then invested these funds in low risk British Government gilts the total value accumulates to £333,049 in 1945.

Post 1945, if this capital sum was transferred to the New Zealand long-term (10-year) government stock (at rates listed, initially, in NZ Official Year Books and, latterly, from Reserve Bank Bulletins and web-site information), the total value accumulates to $63,209,977 in 2011.

This figure is calculated assuming that a sum equivalent to the shortfall was deposited in British Government gilts from the date of loss to 1945, then the annual interest earned was re-invested in a similar deposit to 1945. then, from 1945, the investment was transferred to New Zealand Government long-term 10-year stock, and annual interest was similarly re-invested over the period 1945 to 2011.

Therefore, in this scenario, the value of the opportunity loss to Ngāti Kahu in 2011 is $63 million.

The second scenario considers what could credibly have happened if the land had become Reserve land over which Ngāti Kahu retained ownership. 

This scenario is a possibility because, at that time, the Crown was designating Māori owned land as “Reserve Lands” under one or other of the various Native Reserves Acts being enacted during the period. 

As reserve lands the unimproved value (namely ‘everything below the roots of the grass’) was reserved to Māori with the intention that the income from the reserve lands would be returned to the Māori owners.

Under this scenario, BERL estimated the value of the unimproved interest in this land at 2011 by using Quotable Value Limited data on unimproved value of rural land in Census Area Units 500202 and 500208.  As a result, they found that the lands seized from us had an unimproved value in 2011 of $307 million.

Given the development opportunities that have arisen in the area over the past couple of decades, there is an arguable case that the opportunity loss was even much higher than $307 million.

The third and final scenario envisages what could credibly have happened if Ngāti Kahu had retained ownership of its land and been able to develop its own rohe.

This scenario assumes that Ngāti Kahu retained full ownership of the land, and thus the development of the properties located on that land.  The development of the rohe is expected to have proceeded in much the same way as it has under alienated ownership.

BERL estimated the total capital value of this land at 2011.  Using Quotable Value Limited data on the capital value of rural land in these Census Area Units, BERL found that this land had a capital value in 2011 of $380 million in 2011 on the basis of capital (improved) value.

BERL noted that the use of the capital value of rural land implies that in this scenario the land continues to be used for rural purposes.  Again, this is a relatively conservative assumption, noting BERL’s earlier comments as to the possibility of residential or lifestyle options.

Therefore, in this scenario, the loss of capital value to Ngāti Kahu, had they been allowed to retain ownership and develop the land themselves, is estimated at $380 million.

However, BERL considered that the value of the economic loss suffered by Ngāti Kahu will be higher than the figures summarised below:

• $63 million had Ngāti Kahu received full value for the land and invested in low-risk bonds
• $307 million had Ngāti Kahu been allowed to retain the beneficial interest in only the unimproved value of the land
• $380 million had Ngāti Kahu been permitted to retain ownership of the land and participate in its development.

The economic loss to Ngāti Kahu includes not just the present capital value of loss, but also the stream of lost annual income from their interest in the land asset. These annual income losses will be covered in a later column.

ECONOMIC LOSS

We have a lot of evidence about the social impact of land loss on indigenous peoples as the result of land seizures by their colonisers.  In this country alone, there’s a plethora of well-researched and reviewed reports of negative statistics for Māori in health, housing, education, justice and employment.  But there is hardly any similar research and reportage of the economic losses involved.

In 2012, Te Rūnanga-ā-Iwi o Ngāti Kahu commissioned Dr Ganesh Nana, Kel Sanderson and Adrian Slack of BERL Economics to assess the economic loss suffered by Ngāti Kahu as a result of Crown actions or omissions up to 1865, the loss having as its main cause the separation of Ngāti Kahu from our lands.

To quantify the prejudice suffered as a consequence of those seizures, BERL used as their measure the 249,443.5 acres of Ngāti Kahu land seized by the Crown in the period up to 1865.  The fundamental economic components of their assessment were the loss of capital value, and the loss of the flow of incomes from those lands since 1865.

This week we will look at the loss of capital value to Ngāti Kahu of our lands by taking the actual level of the recorded “consideration” the Crown paid for them over the period 1856 to 1865, comparing those with the land values at that time, and then noting the difference (shortfall) between the two.  

Using information from the New Zealand Official Year Book, BERL calculated the average value (in today’s dollars) of 100 acres of unimproved land in the Mangōnui County at various dates in the past listed below.

1840:  100 acres sold for $12.93

1865:  100 acres sold for $15.31

1878:  100 acres sold for $17.81

1891:  100 acres sold for $21.58

Using these figures, BERL was then able to assess that the total 249,443.5.5 acres (100,944.8 hectares) of seized Ngāti Kahu lands would have been valued at £32,252 ($64,504) in 1840, £ 35,936 ($71,872) in 1856, £ 38,189 ($76,378) in 1865, £ 44,414 ($88,828) in 1878, and £ 53,825 ($107,650) in 1891.

Depending on the date of seizure, BERL was then able to calculate the shortfall between the “consideration” paid by the Crown and the calculated value of the land at the time of its seizure.  The full details for each Ngāti Kahu land block seized can be read on https://www.docdroid.net/XWkaxHo/06-august-2012-berl-report-for-ngati-kahu-on-economic-impact-of-crown-breaches-of-te-tiriti.pdf  But, for the sake of space, I provide only the global figures listed below.

		Acres	“consideration” paid	Value at date of loss	Shortfall at date of land loss	Value of shortfall compounded to 1865
Total land loss between the period pre-treaty to 1865		249,444	7,204	35,972	28,768	39,919
Total value of land loss compounded to 1865						39,919

These show that there was a significant loss of capital value imposed on Ngāti Kahu by the Crown. 

Next week we will look at the loss to Ngāti Kahu of the streams of income from the above lands for the period from 1865 until 2012. 

THE TREATY FRAUD

Last week, a story ran in mainstream media under the headline, “Northland Mayoral Forum to work alongside Taitokerau Iwi” and in Māori media as, “Northland hapū group says forum signing undermines sovereignty”.

The event that triggered these different headlines was the co-signing of a ‘governance agreement’ between members of the Northland Mayoral Forum and the Taitokerau Iwi Chairs Forum.  But a few Iwi, including Ngāti Kahu, neither supported nor attended its signing. 

In the case of Te Rūnanga-ā-Iwi o Ngāti Kahu, that was because our analysis of the agreement identified several serious flaws in it, the worst being its constant and confused reference to The Treaty of Waitangi/Te Tiriti o Waitangi.  It's a standard Crown tactic to treat the two documents as if they are the same in content and intent; something they most definitely are not.

The Treaty of Waitangi is a fraudulent document that was never seen, debated, agreed to or signed by our tūpuna; it supports the Crown fiction that we ceded our sovereignty to it.  Te Tiriti o Waitangi is the only treaty we signed; it reaffirmed the rangatiratanga declared in He Whakaputanga.  To connect the two in this ‘governance agreement’ means that the Mayoral Forum members can, and will, continue to assume that The Treaty of Waitangi has some authority over us.  It does not.

That treaty has always been used by colonialists and racists to justify removing our right to any role in our rohe other than that permitted at the whim of their Councils.  The rest of the document bears that out; there is no mention of Iwi exercising any decision-making powers, and reference to decision-makers appears to refer solely to councils.  Worse still, there is no mention of hapū at all. 

There are some phrasings that give the document a veneer of being consistent with Te Tiriti; e.g. references in one section to partnership, participation and protection.  But that veneer is dulled by The Treaty/Te Tiriti overlay which, in the same section, infers the ‘right to govern’ to councils while Iwi must provide and be provided with ‘full information in order to participate in the [council] decision-making process’.  Where are Te Tiriti and He Whakaputanga in that?

Other serious flaws include little to no consultation about the agreement, lack of notice about its drafting and very short and limited notice about its signing.

Everyone in this country deserves better and, in  fact, we can and will do better under a proper Tiriti Partnership Framework between Kawanatanga and Rangatiratanga that protects our right to determine the way we live and doesn’t marginalise or criminalise us for doing so.  More on this in future columns.

For now, as we gather at Waitangi to mark the 179^th anniversary of the signing of Te Tiriti o Waitangi, we again declare that The Treaty of Waitangi is a fraud and, like the ‘governance agreement’ signed last week, it has no legitimate authority over our whānau, hapū and iwi.