In this article, Gerald Lanning examines the recently released Interim Report of the Waitangi Tribunal which addressed the vexed issue of ownership of Freshwater in New Zealand. In its report, the Tribunal conclude that residual property rights in water bodies may continue to be held by Maori which may in turn require recognition of a new form of property title. Gerald is a partner in the Auckland office of Simpson Grierson.

On 24 August 2012 the Waitangi Tribunal issued its Interim Report on the National Freshwater and Geothermal Resources claim.[1] The Tribunal concluded that the Government's proposal to privatise up to 49% of four State-owned Enterprises (SOEs) should not proceed until Maori rights to the water resources used by the SOEs were protected or provided for. The focus of the Tribunal's findings and recommendations has been on the SOE sale issues. The Government has recently decided to proceed with the sale despite the Tribunal's recommendations, which has led to the Maori Council mounting a High Court challenge.[2] But the Tribunal's findings have wider ramifications for the way in which freshwater (and geothermal) resources are managed under the Resource Management Act 1991.

Managing freshwater - the current situation

Section 14(2) of the RMA provides that, in general, "no person may take, use, dam, or divert [water]" unless "allowed by a national environmental standard, a rule in a regional plan as well as a rule in a proposed regional plan (if there is one) or a resource consent". With the possible exception of an environmental standard, therefore, the taking of water is managed by regional councils.[3]

Underlying the RMA approach is a Crown position that no one (including the Crown) owns water, but rather it is the Crown's role to ensure that the resources are managed in the public interest. As stated by Crown counsel:[4]

To the extent that it is necessary to respond to the rights articulation of the claimants, what the Crown can say is that at an abstract level, a claim of ownership (in the English property law sense) over the water and geothermal resource of New Zealand cannot be accepted by Government. New Zealand has a multi-dimensional society with cultural, recreational and commercial claims on the water resource, and the task of government ultimately is to balance and reconcile those in some way that recognises the long term needs of New Zealanders.

It is now commonly accepted that, in some cases, the current RMA regime may not be the most effective mechanism to manage water resources, especially where demand is close to or exceeding supply.[5] A number of government initiatives have been put in place to address these issues, including:[6]

  • the Land and Water Forum "Fresh Start for Freshwater" report, which made a number of recommendations to reform the management of water, and in particular establish a more limits-based regime;[7]
  • establishment of an irrigation fund[8] and clean-up assistance fund;[9]
  • release of the National Policy Statement for Freshwater Management 2011, made operative on 12 May 2011.

The Tribunal's findings - Maori have residual 'property' rights in water bodies

Although the resource ownership issue is one to be resolved, these initiatives have, consistent with the Crown's approach referred to above, tended to "side step" it - instead focussing on the methods by which the resources are controlled or managed. The approach appears to be one of isolating the issues of ownership and control, and endeavouring to address the ownership issues by amending the way in which the resources are controlled or managed.[10] The Tribunal's findings challenge that approach. By way of a summary it found the following:[11]

  • Water bodies were (at least in some cases) taonga over which hapu or iwi exercised tino rangatiratanga and customary rights in 1840, and with which they had a physical and metaphysical relationship under tikanga Maori (Maori law).
  • Their rights included authority and control over access to, and use of, the water resources.
  • This authority was sourced in tikanga and carried with it kaitiakitanga obligations to care for the resource.
  • Sometimes, authority and use was shared between hapu, but it was always exclusive to specific kin groups; access and use for outsiders required permission (and often payment of a traditional kind).
  • "Full blown ownership" of property in the English sense was the closest legal equivalent for customary Maori rights in 1840.
  • While there are numerous examples of Maori sharing their water bodies, this was an exercise of tino rangatiratanga - not a relinquishment of it.
  • The Crown is entitled to govern in the interests of the nation and the best interests of the environment and must balance many interests in doing so. But that balancing must be fair and comply with Treaty principles, including the Crown's duty to actively protect Maori interests. Specifically, the Crown has a legitimate role to play in the management of water resources.
  • The Crown has a Treaty duty to undertake in partnership with Maori an exercise in rights definition, rights recognition, and rights reconciliation. This might result in a new 'form of title' that recognises the customary and Treaty rights of Maori in their water bodies. Or it might take the form of putting into effect the recommendations of the Wai 262 Tribunal (discussed below) so that kaitiaki can have control of taonga or partnership arrangements where appropriate.

The extent to which there have been Treaty breaches in relation to freshwater is the subject of a future Stage 2 inquiry and report.

In the course of the hearing the Crown relied on the Tribunal's Wai 262 report in which the Tribunal said"[12]

We have found that a Treaty-compliant environmental management regime is one that is capable of delivering the following outcomes, by means of a process that balances the kaitiaki interest alongside other legitimate interests:

  • control by Maori of environmental management in respect of taonga where it is found that kaitiaki interest should be accorded priority;
  • partnership models for environmental management in respect of taonga, where it is found that kaitiaki should have a say in decision-making but other voices should also be heard; and
  • effective influence and appropriate priority to the kaitiaki interests in all areas of environmental management when the decisions are made by others.

The Crown relied on this approach to support its argument that Maori interests in freshwater resources did not amount to "ownership" - rather they amounted (at most) to rights of control or influence.

However, the Tribunal distinguished the Wai 262 report from the present case. It accepted the Crown's submission that the Wai 262 Tribunal rejected the "concept of 'ownership' as an appropriate vehicle for giving modern expression to the Treaty rights at issue in that inquiry".[13] However, the "sliding scale" of rights (from "control" to "influence") was "not incompatible with Maori having residual proprietary interests in - or, indeed, full ownership of water bodies that are taonga".[14] In other words, "recognition of Maori proprietary interests...could only increase the weight accorded the kaitiaki interest"[15].

So what does this mean for the RMA?

There is no doubt that the "ownership" of freshwater raises significant and complex issues: for example, how is property to be defined when it is continuously moving fluid? Nevertheless, resource consents to take, use and divert water are valuable and give consent holders exclusive rights to the relevant resource for the term of the consent. According to the Tribunal, "water permits allow the use and control of water and therefore are analogous to [Maori] residual proprietary rights in the respective water bodies.[16] The Tribunal's findings directly challenge the Crown's right to unilaterally authorise regional councils to allocate rights to use and control water that constitutes a taonga.

As noted above, the Tribunal is still to undertake the second stage of its inquiry. This will consider whether the Maori rights to freshwater resources endure and have been given Treaty compliant recognition in current laws and policies. No doubt, the Tribunal will closely examine the role the RMA could play in recognising these rights. In light of the Land and Water Forum's work, the Wai 262 report and this latest Waitangi Tribunal report, reform of the RMA seems inevitable. In fact this work has already commenced although until now the ownership issues have been 'off the table'.[17]

As far as the RMA is concerned a key question is whether the Crown can continue to authorise regional councils to grant rights to control and use water resources that Maori may have "property" interests in, without Maori consent or compensation. The prospect of Maori consent raises the spectre of Maori having a right of "veto" over resource management decisions. This would run against the generally accepted principle that no such veto exists - for any party.[18] But, from a legal point of view, would such a veto be appropriate where there are residual proprietary rights in the water resource being allocated to a third party? Despite the significant practical issues, such an approach would be supported by the Wai 262 report which recognised the justification for Maori "control" where the "kaitiaki interest should be accorded priority". It would also arguably be consistent with the direction in section 6(e) of the RMA to recognise and provide for the "the relationship of Maori... with their ancestral land, water... and other taonga" (emphasis added). But, as acknowledged by the Tribunal, the Crown has a legitimate role to play in managing resources in the interests of the nation.

As briefly mentioned by the Tribunal, another possible option for resolving the issue is the creation of a new "form of title" to the resources. Presumably, such a title could then create specific rights and obligations under the RMA for both title holders and third parties. The Marine and Coastal Area (Takutai Moana) Act 2011 is a precedent for this approach. Other options include joint management arrangements which can also integrate with RMA processes, such as the Waikato River Authority, created under the Waikato-Tainui Claims (Waikato River) Settlement Act 2010. The government's response to these issues cannot be predicted. The prospect of new legislation creating 'title' to water will raise a range of sensitive political issues. 'One off' management arrangements may be more politically acceptable, but negotiating numerous individual agreements will not be a simple task and will likely require new legislation.

This article was published in the November 2012 issue of Resource Management Magazine.