Hon. Michael Cullen
14 March 2004
Speech Notes

Fellow delegates,

We are now a little over half way through our second term in government since the MMP electoral system came into force. It is clear that the second half of this term is going to prove a little more testing of our capacities than the first has been.

That in part reflects a more challenging economic environment. The rapid rise in the value of the New Zealand dollar over the last year is starting to put considerable pressure on our exporters and the tradeables sector in general. For the third time in the last 20 years we are now going through a period of a seriously overvalued dollar on any fair estimate of its value.

The primary reason for that has been the dramatic fall in value of the U.S. dollar. That has been caused by the combination in the U.S.A. of a large current account deficit and a burgeoning budget deficit, each many times the size of New Zealand’s entire gross domestic product. The budget deficit itself has been caused by tax cuts combined with spending increases, especially in defence, precisely the policies advocated by the National and ACT parties in New Zealand.

Despite the slowdown in growth that is likely to follow from this pressure on exporters I am confident that we will come through in better shape than in the two previous periods with only a very modest rise in unemployment.

There are three reasons for that, all of them due to our good government. The first is a much more active labour market policy than was adopted by our predecessors including more effective case management of the unemployed and better support for retraining.

The second is a more pragmatic approach to business assistance which will be evidenced further in this year’s budget with increased support for exporters.

And the third is the result of our fiscal prudence during the growth of the last three years. Instead of frittering away surpluses on unsustainable tax cuts we have held our nerve. This now means we have sufficient fiscal headroom to allow us to respond to any slowdown without engaging in pro-cyclical fiscal contraction as the National government did in the late 1990s. This year’s budget will be somewhat more stimulatory than its predecessors, although the level of stimulation will still be modest enough to ensure we do not stray from the straight and narrow path of fiscal prudence.

Not that we will simply stand by and let things happen. As I said, the budget will provide extra support for business. And I will soon be taking to Cabinet a recommendation from the Reserve Bank proposals to further align our monetary policy practices more closely with those of Australia, including the ability to take a more active role in exchange rate management. This will not remove the volatility in the New Zealand dollar – that is the price of being a small open economy. But it will reduce it somewhat, and, as importantly, signal to the financial sector that they cannot bank on us being entirely supine in response to their speculative behaviour.

The second reason why the coming eighteen months will be tougher for us than the last eighteen is the obvious fact that Dr Brash has managed to hit some buttons with some of the electorate.

They are, of course, the same ones that Mr English tried to hit, but no one ever took anything he did seriously. Dr Brash has managed to highlight a sense of unease amongst many New Zealanders – especially the middle aged and elderly – about issues of race.

We know there are many myths in the area. What is most disgraceful about Dr Brash’s behaviour is that he has responded to the National Party’s own polling on these matters with a blatant disregard for the truth and a complete denial of the kind of moral leadership on such sensitive matters one ought to expect from him.

In his newsletters he continues to purvey every piece of anti-Maori gossip as if it were fact. And when he is caught out – as he has been most notably over tangi leave and the meaning of Governor Hobson’s remarks at Waitangi – he simply says it doesn’t matter, it doesn’t detract from his message.

Which is simply another way of saying that his statements are race-based, not fact-based. So much for the much-vaunted gravitas he was meant to bring to the job compared with Mr English’s self-doubting hysteria. Dr Brash has replaced that with self-satisfied mendacity.

We can, and must, join issue with him on the facts. We can, and must, join issue with him on the underlying belief that we should all be the same and that any assertion of cultural identity or cultural diversity is somehow an attack on the idea of us all living in one nation.

Dr Brash needs to understand that achieving a low inflation rate, while useful, is not the essence of nationhood for New Zealand in the twenty first century. After all, boasting that one’s greatest achievement is getting it down scarcely marks you out as the archetypal Kiwi bloke.

But we must not be trapped into acting as though we believe the issue he has raised, however dishonestly and irresponsibly, is the most important issue facing the nation.

We must begin by reminding people of the difference Labour has made to their lives compared with what would have been the case had National been re-elected in 1999 and 2002.

Let us begin with superannuitants. On 1 April the rate of New Zealand Superannuation for a married couple will rise to $383.22 . Had National stayed in office that figure would be only $361.40. The minimum wage has been increased to $9.00 an hour. Under National it would probably be about $7.50. The average fee for arts or commerce students at the University of Otago is $3,245. Under National fees rose on average 15.2 per cent a year, which means that the average fee would be $5,200. And the cost of repayment of any loan has been reduced on average by about 25 per cent.

For a state house tenant in Auckland the difference is nearly as dramatic. For a sole parent with two children their rent is now $74 a week. Under National’s policies that person would now be paying an average rent of $132 a week, after allowing for accommodation supplement.

There are many more examples I could give of the difference a Labour-led government has made in ordinary lives. But let me make one more before it gets forgotten. Under National we would have gone to war in Iraq. Dr Brash says we should have done. Under Labour we did not.

A Brash National Government would reverse the gains we have made. Make no mistake – Brash’s exemplars in the National Party are extremists like Ruth Richardson, not the more moderate wing. It would be back to the Employment Contracts Act, back to tax cuts for the wealthy, back to big fees hikes for students, back to cuts in the pension, back to no increases in the minimum wage, back to selling off state assets, back to no security over pensions for the baby boom generation as he flogs off the Superannuation Fund, back to the politics of division and greed.

So under Don Brash it would be back to the future. Of course, eventually, he would find himself home alone. And then we would have to start all over again to clean up the mess. And by then it would all be so much harder.

Out would have gone the fourth week’s holiday for those not strong enough to negotiate it. Out would have gone effective health and safety legislation. Out would have gone the Superannuation Fund just when the baby boomers are about to start retiring, out would have gone a fairer student loans scheme, out would have gone any recognition of the ongoing place of the Treaty of Waitangi in our national life. The trade union movement would be weakened yet again. The elderly will have lost trust in government yet again. The poor would have been isolated further yet again. Crime would be rising yet again.

The Business Roundtable would be happy. Business New Zealand would be marginally less miserable. And everybody else would be wondering how they let themselves get so easily suckered into voting against their own best interests.

For that is the essence of the challenge we now face.

A Brash National government would make most New Zealanders progressively less secure, reduce their opportunities, make social mobility for the less privileged harder, and reduce social solidarity. Only what are, in essence, diversionary tactics would make, therefore, most New Zealanders vote for such an agenda.

We must not allow ourselves, in turn, to be diverted from the sensible policies which offer an alternative path of greater security, greater opportunity, and greater social solidarity while recognising and valuing diversity.

This year’s budget will be an expression of that purpose. But it will also bear our hallmarks of prudence. The gains will be delivered progressively: some towards the end of the year, with the two largest elements on 1 April 2005 and 1 April 2006.

It is simply too big a package to deliver in one instalment. And it points towards further gains in the future.

The direction will be clear. Taken together, the changes will deliver a much improved income support system. They will mean a decent start for children for low and moderate income families.

They will increase economic participation. They will make work pay for those on lower incomes without penalising those who need benefits. They will deliver a real social dividend for those who have benefited least from New Zealand’s growing economy over the last ten years. And they will simplify the benefit system.

In one sense it is a modest package. It is certainly not a Brash one. And as it is entirely and unmistakeably focussed on needs it will challenge National’s hypocrisy.

It is modest in the sense of the immediate gains this year. But in its overall scope and direction it is what we exist for as a party and it is to carry on that work that we must seek to be re-elected. Against National’s record of benefit cuts, pension freezes, and a sustained assault on the wages and conditions of workers our actions will speak louder than any words.

The second major direction we must continue to follow is that complex of policies which add up to building a more modern economy and equipping all New Zealanders to play their part in it.

That is why we provide much greater assistance to businesses than National did. For market development, for skills development, for research and development spending and support has expanded significantly. We still have a long way to go to come up to the standards of many other developed countries. Dr Brash does not believe in such programmes. He does not believe in picking winners.

When you’ve been the losing candidate twice for the super safe National seat of East Coast Bays that is not surprising. When you presided over one of the darkest periods in the kiwi fruit industry that is not surprising. When you got an international reputation as the most hawkish and least growth friendly central banker in the developed world that is even less surprising.

Building businesses is one thing. Making sure we can meet their skills needs is another. Steve Maharey’s greatest contribution to the government will, I am sure, be seen in this area. The drive on industry training, the building of modern apprentices, the increase in affordability of tertiary education, and above all, the major restructuring of the tertiary education system which, over the coming years, will improve the quality of our graduates are the key components.

At the other end of the system the government has adopted a strategy for early childhood education which will see substantial increases in funding over the next ten years. At both ends of the system we unashamedly stand for increasing the representation of Maori and Pacific peoples. This country cannot prosper in the twenty first century on the basis of a managerial and professional class which is almost entirely white. And if iwi trusts and others come to the party with funding for scholarships so much the better.

The third direction is an independent stand in foreign affairs which meets New Zealand’s interests, not someone else’s. Labour will not sell out our nuclear policy in hope of gaining some short-term economic advantage. Labour will not send our young men and women to war for the sake of a few extra lamb chops on American dinner tables. Dr Brash would. He has said so both publicly and privately. He has made it clear our integrity as a nation is up for sale. He believes in a swap of guns for butter and never mind the morality. And isn’t it ironic that the armed forces he would so readily commit to war are heavily over-represented with Maori? But then he wouldn’t see the irony.

Which brings me to my final topic, that complex of issues which is sometimes described as race relations.

As a nation, at the moment we are making rather heavy weather of this, even though, in general, we tend to do better than many other multicultural nations.

Sometimes we need to remind ourselves of some simple truths, for often simple truths are the best answer to simple slogans. We, in this nation, are all the descendants of people who arrived well within the recorded span of history. The first settlers, who thus became the indigenous people of New Zealand, the tangata whenua, arrived here we are now fairly certain after Westminster Abbey was built, after the early crusades, and about the time of the foundation of the first European universities.

But by so doing Maori did establish their position as the indigenous people and remained unchallenged in that position and possession for many centuries thereafter.

From the perspective of the British Government at the time of the signing of the Treaty of Waitangi there was never any doubt about the status Maori held in that respect. And, in legal terms, that fact endures to the present day, irrespective of the content and meaning of the Treaty.

In the early twentieth century there was a rather bizarre attempt to invent an alternative history involving a prior indigenous people, the Moriori, which, sadly got wider credence via the means of the Department of Education’s School Journal. It was nonsense, and was shown to be so as early as the 1920s. Put simply, there never was any evidence for it (although Muriel Newman still seems to believe it is a fact).

Thus we are a nation all of whom are descended from immigrants. About one of six of us can claim the status of being tangata whenua, the people of the land, the indigenous inhabitants. And all of us are now the people of New Zealand. And while some of us have rights to go elsewhere in the world as citizens that is not true of most pakeha now, and equally is true of some Maori who have other recent ancestry.

What does all that mean in terms of the rights of New Zealanders? In particular in the light of the Treaty of Waitangi, a document that can scarcely be unilaterally abrogated by the Crown?

What it means has to be understood, in particular, in terms of clauses 2 and 3 of the Treaty, established common law jurisprudence in relation to the rights of indigenous peoples, and parliamentary sovereignty.

Clause 2 guarantees to Maori the possession and the preservation of their taonga, not just the fisheries, forests, etc mentioned in the English text. That is why we have Maori Television, starting in just two weeks. To stop that, as Dr Brash has implied, would break solemn undertakings given to the courts by the government, themselves a consequence of a hearing on Treaty matters.

That is why successive governments have promoted kohunga reo and kura kaupapa. This is no more separatist or an expression of privilege than is the promotion of the Welsh language in Britain.

Under Clause 3 we all enjoy equally the rights and duties of what was in 1840 called British citizenship but which, since 1974, has been New Zealand citizenship. And many of those rights and duties change as the exercise of parliamentary sovereignty alters them. Despite the claims of two systems of law emerging I cannot think of any significant example of where those rights and duties differ between Maori and non-Maori except in a small number of cases where they are a direct expression of the Clause 2 Treaty obligations the Crown still carries (for example, with respect to consultation on some planning matters). And even then those differences are not between all Maori and all pakeha. They are between those Maori with connection to a specific place or area and the rest of us – including most Maori.

Which is where the foreshore and seabed issue comes in. No issue could present the government with a more difficult exercise in balancing the competing obligations inherent in the Treaty, common law rights, and parliamentary sovereignty.

The Court of Appeal in the Ngati Apa case were asked to rule on a number of issues. In the end they only ruled on one. That is they ruled that the Maori Land Court had the jurisdiction to determine whether foreshore and seabed was customary law under the Te Ture Whenua Maori Act 1993.

They did so on the well established basis in other common law jurisdictions (such as England, Australia, and Canada) that the assertion of title residing in the Crown did not extinguish customary rights unless that had explicitly been done by way of statute. In New Zealand the statute law is clear – the Crown owns the foreshore and seabed. But none of the number of statutes that state that (or imply it) explicitly extinguished customary rights. Therefore, the Court concluded (rightly in my view) those rights had not been extinguished.

One might question the jump that moves from that point (which overturned the Ninety Mile Beach decision of the 1960s) to recognising the jurisdiction of the Maori Land Court to determine customary land status, since legally it is the High Court which has had jurisdiction over common law rights, rights which are not themselves dependent on the existence of the Treaty.

Nevertheless, that was the conclusion of the Court and it was with that conclusion that the Crown had to grapple in practice. In their observations (not to be confused with their ruling) a number of judges expressed the view that in very few cases would it be possible to show that the bundle of customary rights that any group possessed would add up anything like a claim to freehold title.

That was neither the message taken by many Pakeha nor by many Maori. Ironically, both tended to agree on the same false conclusion: that the Court of Appeal had ruled that Maori did own the foreshore and seabed.

Though false, that conclusion did contain a kernel of truth: the decision did open up the possibility of exclusive private, if collective ownership of the foreshore and seabed. And I would venture to suggest more commonly than the Court had concluded as the criteria to be applied under the 1993 Act are looser than the kind of example the judges gave.

Now, for the government this had two implications. The first was that we were not prepared to see substantive areas of foreshore and seabed pass into private hands when those had been seen by the great majority of New Zealanders as part of our common heritage. Public access for all as of right was not something we were prepared to see diminished. Equally, it was clear that Parliament (and the government) in 1993 had never intended that the Maori Land Court should have the power to place foreshore and seabed in private ownership.

And when the judges rule that the law means something which is contrary to Parliament’s original intent, or contrary to agreed public policy, Parliament has always asserted the right to change the law. We do so almost every year in tax matters. There would never be a year when that has not happened in some instance or another, I suspect.

For while judges are unaccountable and not responsible for the consequences of their actions, parliamentarians, especially those in government, are.

But if we were to remove the power suddenly, and unexpectedly, granted to the Maori Land Court, then other facts had to be given proper recognition. One was the undeniable fact that Maori had continued to assert since 1840 status in relation to the foreshore and seabed. Place after place along the coast has special significance for whanau, hapu, and iwi. In other words, the real live fact of ancestral connection ought to be recognised.

Secondly, as the Court had stated, there were specific customary rights which had endured since before 1840 and had therefore not been extinguished. Although the largest block of those rights – customary fishing rights – had been dealt with as part of the 1992 fisheries settlement – any overall solution had to include better means for the recognition and protection of those customary rights.

This is where a slogan of one law for all becomes misleading. The foreshore and seabed legislation will be one law for all New Zealanders. But the customary rights that will be recognised will belong only to people of Maori descent, and only then in a collective form such as a whanau, hapu, or iwi. By definition, somebody such as me, whose family arrived in 1955, cannot have such customary rights. But, of course, my descendants at some point in the future may share in them as some of the descendants of earlier pakeha immigrants now do.

The government’s proposal is thus neither difficult to understand nor does it arise out of a vacuum. It states that the foreshore and seabed will be vested in the people of New Zealand, all of us. Some believe that would be better expressed as ownerhip by the Crown and there are arguments in favour of both formulations.

Maori who can claim on a collective basis ancestral connection will be able to have that recognised. Where that has already in effect been recognised – as in the Ngai Tahu treaty settlement – that will be taken as sufficient to establish ancestral connection. Where it has not, application can be made to the Maori Land Court for recognition.

The holders of ancestral connection – I am advised likely to be mainly hapu – will establish their position as the appropriate Maori to talk with and to involve in the management of the coastal marine area. The basic criterion is that that level of involvement will be not less than has been the case hitherto. This will then allow for a range of practices reflecting regional variations – up to the level of considerable devolved management in the case, say, of Ngati Porou on the East Coast. But the regional councils will retain the final responsibility for management and control as they have under present legal provisions.

Maori will also be able to go to the Maori Land Court for the recognition of customary rights. These will have to meet the continuity tests which apply to common law rights in similar jurisdictions. Extinguishment in the past may involve a Treaty issue but that is always to be dealt with separately since nothing in these proposals affects present or future Treaty claims.

Where a proposal for development in part of the coastal marine area may affect the exercise of a customary right then the holders of that right may stop such a development where its impact would be severely adverse to the exercise of the right. No resource consent for the exercise of a right will be required but it cannot conflict with existing statutory provisions and where, as a result of this, the right cannot be recognised the Maori Land Court will be able to call the government’s attention to the problem. And where the exercise of the right could conflict with sustainability requirements the local regional council will bring that to the attention of the Minister of Conservation.

There is much other detail. But in essence, the public’s general right of access is preserved. No new private ownership is created. The Crown’s right to manage is asserted. Maori have ancestral connection and customary rights recognised and protected.

One key issue raised in the Waitangi Tribunal’s report does require further thought. That is the loss of the inherent jurisdiction of the High Court in relation to customary rights.

Proceeding to completion on the foreshore and seabed is not going to be easy. But no other political party is able to do the work. No other party so clearly reflects the different interests which must be brought into some harmony on this matter. And no other party could have managed the difficulties of doing that as well as we have. I pay particular tribute to my Maori colleagues in that respect.

That we must not be deflected from our task is clear to all of us. If we had any doubt that we are essential to building a genuinely fair, independent, and progressive New Zealand then the last few weeks have surely removed that.

New Zealand in the 21st century is a multiethnic and multicultural nation. We live in isolated farms, rural communities, small towns, urban areas, and large cities. We are white, brown, black, yellow and many other shades. We have two official languages but speak many others. We live in a nation which is more exciting that at any time in its history. It needs leadership that looks forward, not back; that is inclusive, not excluding; that works towards greater fairness and justice, not less. We will provide that.

ENDS

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