New Zealand Executive Government News Release Archive

The Minister of Maori Affairs, Hon John Luxton today released the Government's policy decisions relating to the Maori Reserved Land Amendment Bill 1996.

"This landmark legislation is providing certainty for lessees and for owners on what has been a longstanding issue with many reviews giving considerable uncertainty," said Mr Luxton.

"Since 1991, we have undertaken five years of extensive consultation. As a result, we are now putting in place mechanisms which give both parties the opportunity to preserve the value of their investments. The legislation though, will not impede owners and lessees from reaching their own negotiated solutions.

"Throughout this process the Government has protected the property rights of owners and lessees and we have ensured that one injustice is not replaced with another. However, at all times, the Government has recognised that this issue must be resolved," the Minister stated.

"The key issue that has needed resolution arose out of the legal framework defining the relationship between lessees and owners by prescribing rent return and the rent review period in the Maori Reserved Land Act 1955.

"The Maori Reserved Land Act 1955:
· Prescribed rents of 5% of unimproved rural land, 4% urban land;
· Fixed 21 year rent review period; and
· Perpetual right of renewal.

"This Act brought together 43 early pieces of legislation dealing with Maori Reserved Land which had reflected the objectives of early New Zealand Governments of the day to have rapid European settlement and development of productive land. However, the lease terms sought and conditions set did not always take into account the wishes of the landowners.

"The Maori Reserved Land Amendment Bill 1996 seeks to remedy this situation by placing the relationship between owners and lessees on a more commercial level and returning the landowner rights to the owners, whilst at the same time providing protection for the property rights of the lessees," said Mr Luxton.

"The Bill's provisions include most of the Government's Policy Decisions of 1994 but we have, after much consultation, responded to concerns raised by making some key changes relating to retaining the perpetual renewal clause and compensation for the move to market rents.

The legislation will:
· continue to allow lessees the right of perpetual renewal for leases;
· provide for a phased move to market rents. Once the legislation is passed, there will be a three year delay before market rents are phased in over the following four years;
· provide compensation from the Crown to owners and lessees. Owners will receive compensation for the delay in moving the rents to market levels and lessees will receive compensation for the move to market rents and more frequent seven year rent reviews. The cost to taxpayers is likely to exceed $40 million.
· give owners a right of first refusal to buy leases (at the market value) except when existing lessees (on the day the Bill becomes law) seek to transfer their lease to their spouse and/or child. All other transfers are subject to the right of first refusal;
· provide for the owners rights of first refusal to have been deemed as given when the lessee has given the owners 28 days written notice prior to sale by public auction; and
· give lessees the right of first refusal should the owners wish to sell their land, provided owners comply with the requirements of Te Ture Whenua (Maori Land) Act 1993.

"The major impact of the Bill gives owners the opportunity to purchase the lessees improvements over time if they choose, and ensures lessees property value is protected and that owners will receive a fair return for their land, whilst giving compensation to both owners and lessees for the market rental changes," the Minister said.

"Many owners and lessees have already expressed support for the Government's proposals and will welcome this opportunity to resolve this long standing issue. Already more than 400 leases have rental changes negotiated directly between the owners and the lessees, separate from the 1955 prescribed legislative rents.

"I anticipate the Bill being introduced into Parliament during the next session. Upon referral to the Select Committee owners and lessees will have the opportunity to make further submissions and a letter to both groups will be sent out inviting submissions on the Bill," Mr Luxton stated.

"All lessees and owners will receive the booklet providing details of the legislation proposals. Over the last week, interested groups have been briefed by officials on this legislation and I have personally briefed other political parties.

"The introduction of the legislation will be an important step forward to meeting the concerns of all parties.

"My sincere thanks to everyone who has been involved in both the policy development and consultation process for their hard work and constructive contributions," concluded Mr Luxton.

Ends

A booklet outlining the details of The Maori Reserved Land Amendment Bill 1996 is available. To obtain a copy please call Keriana McGregor, Te Puni Kokiri Head Office, Wellington, (04) 494 7000.

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