John Minto: Iwi Used To Defend Economic Privatisation

Government plans to involve the private sector in state housing should come as no surprise. And neither should there be any surprise that iwi groups are keen to take up these state assets at knockdown prices.

State responsibility for, and ownership of, housing for low-income families is anathema to National and the government is squirming to avoid expansion of this desperately-needed social housing stock.

So Housing Minister Phil Heatley is working hard to encourage community groups, particularly iwi, to purchase state houses and take over the rentals. He says he wants to achieve a radical increase in the social housing stock by helping what he calls "third sector" providers to purchase existing housing stock and then use loans, grants and subsidies from health and social development budgets to expand provision.

Current government policy is that state rentals are kept at a maximum of 25% of a family income. This was a change brought in by Labour in when it took power in 1999 after the fiasco of market rentals under National whereby low income families could pay over half their income in rent with not enough for the other essentials of food, electricity etc

This policy has problems for the house purchasers. The government wants buyers to pay the book value of the assets but iwi groups say they only want to pay the rental value. Whakatane iwi Te Runanga o Ngati Awa say the book value of the 400 state houses in Whakatane is $80 million but according to the iwi the rental return based on government policy would justify a purchase price of just $19 million.

The iwi is happy to buy at this price which they say would give them some "flexibility".

What this means in practice is that if the iwi were a successful bidder it could increase the rents to market levels and make a killing while National would see benefit simply in the sale of state assets. Government responsibility for state housing insuch areas would disappear. It would be a win-win for National and iwi but a huge loss for the families currently in the houses and for the whole community who lose control of critical social housing assets.

Deals like this have become a familiar pattern with the selloff of state assets where the private sector gets the cream and taxpayers and low-income families get the buttermilk.

It's also a familiar pattern for another reason. Increasingly the government is doing deals with iwi leaders to provide political cover for right-wing politicians driving community destroying policies.

Politicians have figured its harder to attack the dismantling of social assets and the sale of state assets when Maori are the beneficiaries.

This was a feature of National in the late 1990s when Winston Peters, with the New Zealand First monopoly on the Maori seats was used in this way.

Labour followed when Steve Maharey was Minister of Tertiary Education and lumped Maori education providers in with PTE'S (Private Tertiary Establishments). Funding for PTE's skyrocketed and was defended by Labour on the basis some of them were Maori organizations. At the same time our polytechs and universities were starved of resources.

Now under National we have iwi leaders putting their hands up for shares in state assets National intends privatising after the 2011 election as well as for state houses. Similarly iwi groups are doing deals with the private sector to help in the running of private prisons.

Much of this is possible from the Treaty of Waitangi settlement proceeds. Newly enriched iwi leaders are on a shopping spree for state assets and state contracts for services and while aspects of these relationships can be positive they are being used by National to promote privatization across the entire economy.

Iwi leaders and the Maori Party are buying into this model as a supposed tino rangatiratanga or Maori self-government model. However this is far from the Article two meaning of tino rangatiratanga from the Treaty of Waitangi.

Put simply most iwi leaders are now more comfortable drinking and mixing with the pakeha corporate elites than in providing uplifting involvement for Maori, most of whom struggle from day to day on meagre incomes.

Iwi leaders are the new Uncle Tom's. They have stopped the corporate gravy train just long enough to jump on.

Click here to comment on this column at Auckland.Scoop.co.nz

© Scoop Media