19 January 2007

Opinion-Editorial

Time for an informed debate on tenure review

Intro: Land Information New Zealand welcomes the ongoing debate about South Island high country tenure review but the facts, rather than conjecture, are important. It’s time for a reality check says Brian Usherwood of Land Information New Zealand.

Portraying taxpayers as losers and farmers as outright winners in the South Island high country tenure review programme makes an enticing but misleading headline.

The premise that the government is paying farmers to take the land is incorrect. And the debate appears to ignore the valuable economic, conservation and recreational gains that are being made as a result of tenure review. There appears to be a fundamental misunderstanding of how tenure review agreements are reached between the Crown and lessees.

Tenure review is a voluntary process whose objectives are clearly spelled out in legislation. Land with conservation values is able to be freed from the lease and retained in full Crown ownership as public conservation land. Other parts of the land capable of productive economic use are able to be freeholded to the lessee. To achieve this each party, not just the Crown, buys out the other’s interest in the lease.

Like any tenant in a lease arrangement, pastoral lessees have property rights in the leasehold land that’s eventually retained in the conservation estate. These rights, like the rights of any tenant, include rights to quiet enjoyment and exclusive access to the property. In addition the lessee owns the improvements (eg buildings and fencing) on the land. However, unlike other more common leases, the lessee also has a right to perpetual renewal of the lease.

If the Crown wants to free part of the land from the lease for conservation or public access, the Crown must purchase the lessee’s property rights in that land. Similarly, to dispose of leasehold land capable of economic use as freehold, the lessee must purchase the Crown’s property rights. The value of each of these respective interests is set by the market as with any other property transaction.

The lessee’s and the Crown’s interests are not the same and therefore their values are not generally equal. Both parties pay each other to buy out their respective rights. The size of these payments is determined by market valuations. Like any other landowner selling property, Land Information New Zealand seeks independent market valuations when undertaking each transaction. The debate about the value of each party’s interest needs to recognise that this process ensures that the widest possible consideration is given to the various factors that make up ‘value’.

Settlements are negotiated with the benefit of current market valuations on hand, and both parties must agree if a successful tenure review outcome is to be achieved.

Public benefits
New Zealand benefits from more diversified use of the former leasehold land freeholded through tenure review. New Zealanders have also benefited to date from around 127,000 hectares of land being made accessible by virtue of it no longer being constrained by a lease.

The increased public ownership of land important for high country biodiversity needs to be acknowledged, along with the greatly improved recreational access to the high country being created in many areas.

A transparent process
Some critics have also challenged the transparency of the tenure review process and the professional integrity of LINZ staff and contractors working on negotiations, some going as far as alleging ‘behind closed doors’ disposal of high country land.

The tenure review programme, which began in 2000, is mandated by the 1998 Crown Pastoral Land Act (CPLA), itself the result of many years of analysis, debate and consultation between the government of the day and stakeholders on the future of pastoral leases.

Transparency of tenure review negotiations is built into the Act in a number of ways. A range of parties, including the Department of Conservation, Fish and Game and iwi are consulted as proposals are developed. All proposals are advertised for public comment before they are finalised, with all copies of submissions and the analysis of these submissions being public information and publicly available on the LINZ website.

The Minister for Land Information now sees all proposals and has an opportunity to comment before decisions are made. Every stage of each review is documented on the LINZ website. Final decisions are made by the Commissioner of Crown Lands, who considers all matters that are relevant under the law and is legally accountable. Furthermore, the law provides the public with options for redress if decisions are not properly made.

Land use arguments
The use of land after tenure reviews have been completed has been another area of concern. Like any other freehold land in New Zealand, land use is subject to the Resource Management Act and district and regional plans. This is where the community has the opportunity to air views on appropriate uses of the land. The law provides protections when pastoral leases are turned into freehold and then again regulates land use when the land is held as freehold.

The objects of the CPLA were carefully crafted to reflect the competing interests in the high country. Tenure review outcomes have evoked strong emotional responses, a reflection of how highly valued the South Island high country is for New Zealanders. Land Information New Zealand values a healthy debate and hopes that this debate helps ensure it continues to be fully informed.

Brian Usherwood is General Manager Business Support at Land Information New Zealand.

ENDS

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