The ‘Fiscal Envelope’ and its Consequences

In late 1994, the government provided a catalyst for a united Maori endeavour by calling for a public debate on a raft of proposals to guide future Treaty settlements. It had already signalled in the Sealord deal that it had in mind a total sum to cover all settlements, having made clear that reparations could notpage 262 be pegged to any concept of ‘just’ or replacement compensation for that which had been lost (even if it were possible to work such things out). In May 1994, it had been reported that officials and ministers were closing in on an overall settlement sum (which would include a valuation placed on land or other resources transferred). Not only were there ‘fiscal constraints’ on the Crown, but it was expected that a total settlements figure would be needed before any tribe would sign up to a final Treaty settlement. That was certainly the position of the claimants at the most advanced stage of negotiations, Waikato–Tainui.

In Doug Graham’s formulation, a ‘Treaty settlement envelope’ would allow for settlements to be ‘consistent and fair’ relative to other settlements and to a total pool of available resources. After much internal (and highly contested) intra-state deliberation in which Treasury analyses featured large, the Crown unilaterally fixed the ‘fiscal cap’ at a billion dollars, to be paid out over a ten-year period. Whatever the merits of the fiscal cap, or its amount (and, to take one example, TOWPU’s and TPK’s recommended figures were greatly in excess of Treasury’s), iwi negotiators could now consider any Crown proposals in relation to the total resources in the state’s Treaty coffers. The pioneering Tainui and Ngai Tahu settlements came, in fact, to include a ‘relativity clause’, with the Crown agreeing to increase their settlements if the fiscal cap increased in the future; their portions of the settlement envelope would always remain at 17%.

When the Crown put its ‘Treaty Settlement Proposals’ out for consultation, the only non-negotiable element was the fiscal cap. Enormous Maori anger at both this unilateralism and the relatively low level of the cap greeted the release. The proposals, many of which did reflect some discussion with Maori and which the Crown was prepared to adjust, were completely overshadowed by the issue of the billion dollar imposition. Soon known as the ‘fiscal envelope proposals’, they were interpreted throughout all quarters of Maoridom as a ‘breach of tino rangatiratanga’. Under the auspices of Sir Hepi Te Heu Heu, a thousand people from all round the country, representing a full range of tribes and Maori organisations, met in January 1995 at Hirangi marae in Turangi to discuss a unified response.

From the hui, a unanimous message went out to the Crown, definitively rejecting the imposed fiscal envelope as a massive violation of rangatiratanga. Delegates noted, in particular, that no partnership of the type supposedly embodied in the Treaty could tolerate unilateral pronouncements from one side, especially on a subject so crucial as resolving past breaches of the Treaty. The Hirangi hui demanded Crown respect for rangatiratanga, canvassed several constitutional models under which the Crown might meet its Article Twopage 263 Treaty obligations, and by unanimous decision proposed a major Crown–Maori constitutional review on the basis of the Treaty of Waitangi.

Waitangi Day was particularly tense that year, and Pakaitore/Moutoa Gardens in Wanganui were occupied by Maori activists in a confrontational stand-off that lasted until May, riveting the attention of the nation (and producing considerable pakeha backlash). Emotional and dramatic opposition to the fiscal envelope was expressed at regional consultation hui organised by the Crown during February and March 1995 – an enormous ‘public relations disaster’ for the Crown. The organiser of the hui, TPK’s chief executive, noted that Maori ‘across the political spectrum’ were for the first time ‘united in opposition to the government’s policy proposals’. The theme of all the hui, and of protests throughout New Zealand, was reclaiming rangatiratanga.

That May, even tribes preferring to work independently of others in their dealings with the Crown agreed that issues of common concern should be handled in a kotahitanga fashion. Those working within the Maori Congress launched a national debating exercise on ways of embodying rangatiratanga in constitutional arrangements. At a hui in Taranaki it was agreed that, while diversity within the Maori world needed respecting, the ‘commonalities shared by all Maori’ meant that unity was possible. Indeed, unity was necessary in order to attain mana motuhake, Maori autonomy. The bottom line was that ‘Maori should be able to determine their own futures, control their own resources, and develop their own political structures’.

With much frustration at the lack of progress on achieving such rangatiratanga, other high profile occupations of claimed land and property followed Moutoa Gardens. The old Takahue School, the empty Tamaki Girls’ College, Kaitaia airport, Coalcorp-owned land in Huntly and the disused Taneatua railway station were among sites occupied during the course of the year. Like Bastion Point in the late 1970s, the occupations involved a ‘layering of grievance upon grievance’, with land and Treaty issues intertwined. The Crown’s declaration of the fiscal envelope added an overarching grievance around which all protesters and occupiers could agree. Few people expected the Crown, immediately at least, to rescind or raise the fiscal cap. But many believed that the furore which greeted it might compel the government to open consultation with Maori on various issues of rangatiratanga.

Yet the chances of this seemed slim. A number of ministers and officials wrote off the various criticisms of the government’s approach to Treaty settlements, as well as to occupations, as driven by radicals. They refused dialogue with anyone taking direct action, seeing this as an issue of public order and therefore for the coercive authorities to handle. And most strongly of all, they continued to reject any discussion that might imply constitutionalpage 264 change, ring-fencing Treaty settlement issues from any talk of constitutional or other arrangements to effect recognition of rangatiratanga. Separately or together, such refusals to engage further fuelled the mid-decade propensity for direct action. Moana Jackson spoke for many in declaring that addressing the Treaty involved not just redressing historical grievances but also ‘looking at all the issues of political power, constitutional restructuring and so on, which are part of the treaty’.¹⁷

In a letter written to Sir Hepi Te Heu Heu a week before a second Hirangi hui in September 1995, Prime Minister Bolger reiterated the longstanding Crown view that ‘the sovereignty of Parliament is not divisible’. There being ‘no political will to alter fundamental constitutional arrangements of the nation’, he invited the hui to ‘consider the development of the Crown/Maori relationship within manageable parameters which take into account the indivisibility of Parliament’. Sir Hepi affirmed in his opening address, however, that the hui had been convened precisely to focus on ‘ways Maori can assert their tino rangatiratanga’ in relationship to the state. In view of the government’s disinclination to debate such issues, the hui almost completely ignored the Crown’s views, and it declined an invitation from Bolger for its representatives to join an officials’ working group on settlement matters. Speakers emphasised the need for constitutional reform and the processes which might be used to achieve it. The head of TPK later reported that indigenous sovereignty was affirmed by many young Maori, who ‘were listened to politely by the many chiefs who were present, and were certainly not dismissed out of hand. It is clear that the issue of sovereignty and tino rangatiratanga will not go away’. The prime ministerial response was to restate that the Crown ‘cannot negotiate the division of sovereignty’.

The hui provided a deliberate and powerful statement by Maori that if the Crown continued to refuse to consult over appropriate ways of recognising rangatiratanga, Maori would decide matters independently and only then take their position to the politicians. While unilateralism was not ideal, there seemed to be little choice. The second Hirangi meeting was followed by a third in April 1996, which had double the attendance of the first, and called for the ‘decolonisation’ of New Zealand. This could come about through the ‘establishment of protocols governing relationships between Maori and with the Crown’, and these needed to be followed by ‘constitutional change’. A new constitutional model could be developed incorporating Maori tikanga and a Maori worldview, with the various processes requiring ‘expos[ure of] the effects of the Pakeha colonisation process’ before the ultimate goal of rangatiratanga could be attained. As one commentator put it, ‘sooner or later the government will have to face the issue … because governments come and go … but Maori will still be there with their agenda of tino rangatiratanga’.¹⁸