Hon Dr Pita R Sharples

Minister of Maori Affairs

Mâori Economic Workshop

Te Puni Kokiri House, Wellington 28 January 2009; 10am

At Ratana last Friday, Taranaki kaumatua Tiki Raumati jumped to his feet and challenged the Prime Minister, “like it or not your mokopuna and my mokopuna will one day marry”.

His message was clear - the citizenship rights inherent in article three of the Treaty, must be honoured, we must live together as equals, in a socially just partnership, live in a land where we should all share the benefits of prosperity, to endure in good times and in bad.

It is a reality we must prepare for, a future horizon that must inspire our planning, and there is no better time to do that, than at the brink of a global financial crisis, the likes of which we have not seen since the Great Depression of the 1930s, or in the immediate aftermath of the 1987 market crash.

I want to thank all of you for the generosity of spirit you have shown, in giving your time at such short notice, to respond to the issues, risks and opportunities that lie ahead of Mâori in the current economic climate.

This parliamentary term will be defined by how we negotiate the swirling economic waters ahead. We have faced these perils before, and for Mâori, the experience was disastrous. In the period known as te Pâheketanga Ohaoha, the days of the Great Depression, 75% of all Mâori men were unemployed by 1933. More recently the recession of 1987-1992 resulted in a shocking deterioration in outcomes for Mâori. Look at the proportion of Mâori families classified in the Social Report as being ‘low income’, for example.

In 1986, 14% of Mâori families fitted this category, just above the population average of 12.7 percent. Yet six years later in 1992, the proportion of Mâori families marked as low income was a phenomenal 42 percent, compared to the average of just 26 percent. This is staggering. Worse still, there are even more marked disparities for specific populations within this.

During that same period in which the recession set in, the participation of Mâori women in the labour market fell sharply, while that of non-Mâori women was fairly constant. As all of us in this room will know, the future relationships that Tiki Raumati predicted will not be successful if the ground is not level from the outset. We know that too many of our whânau are still recovering from the intergenerational effects of long term unemployment and grinding poverty.

The children of low income families are in a precarious state with too many lives at risk as a consequence of severe and significant hardship. Research by the Child Poverty Action Group indicates that between 40 and 50 percent of Mâori children live in benefit dependent families. These children must be in our every thought as we venture forwards. But the history we have inherited must not deter us from today determining to be bold. It is time to close that chapter of our story and start afresh. Today I am asking you for advice on how we can shape our destiny which beckons us forward.

What we can do to address unemployment? How we can negotiate the recession and put in place buffers to prevent adverse impacts on our whânau, hapû and iwi? We, Mâori, are in an incredibly strong position to offer leadership to the nation, and we must use that position wisely. Our starting prospects are looking good. Our workforce skills are much more diverse than they were in 1987. Mâori are also better represented in employment categories across all sectors and industries. The Mâori asset base has increased in value, including the broader base afforded by the opportunities of Treaty settlements.

But there is another aspect to our story today, which some commentators are calling the “Mâori edge” - basically our comparative advantage in business.

This “edge” has been seen in the success of Mâori as entrepreneurs; as voyagers; as explorers; as leaders - and is seen in the fact that so many of our ventures reflect the following characteristics:

§ resilience and flexibility;

· inherent and acquired trading capacity;

· an emphasis on relationships and a long term perspective;

· curiosity and an increasing willingness to diversify;

· uniqueness and freshness; and

· the ability to work across cultures.

Perhaps just two examples of this edge will start us thinking today.

During the midst of the last recession in the 1980s, the local economy in Kaikoura was all but annihilated, as fishing, farming and the railways all suffered market decline. Local Mâori were hit worse.

And then along came Bill - local kaumatua Bill Solomon and their whânau, decided to take action, pooling all their own resources to lay the groundwork for what became the highly successful Whale Watch; a thriving business which now pulls in over 140,000 tourists a year.

Alongside the business, they set about constructing a new marae which both created a new economic direction for the town, while at the same building and regenerating the pride and passion of the people.

And then closer to home for me, around about that same time, Dean and Kristen Nikora left their town jobs to go dairy farming Mangatewai, a 342-hectare dairy farm near Takapau.

Over the last two decades, they have worked their way up literally from farm labouring, through to share milking, and then last year were awarded the prestigious Ahuwhenua Trophy - the Excellence in Farming Award - after they instigated a wealth creation strategy that the judges labelled as nothing short of outstanding.

And so this is my desire for this Mâori economic workshop today - that we too, bring together our knowledge and expertise and that indisputable Mâori edge; to take a leading role in the nation’s economy, in ways which are nothing short of outstanding.

This workshop is not just a one day wonder. I am thinking long term.

We have entered a new era, with a commitment that is driven by kaupapa Mâori, a vision that will be guided by tikanga.

Our thinking will be influential in informing the Prime Minister’s Jobs Summit to be held in Auckland at the end of next month. But I am hopeful that the discussions today, will also lead into a bigger and bolder movement to sustain and engage Mâori economic self-determination. It’s now our time to take a leading role in New Zealand’s economy.

I know that this group, with your formidable combination of wisdom, knowledge, experience and foresight will be able to offer us invaluable insights into the pathway ahead. In that quest, we will need to summon our collective strength to negotiate three powerful drivers, namely:

· the creation of what is called innovation economies;

· the redistribution of world economic power that is already underway; and

· climate change and resource pressures.

Innovation economy

By ‘innovation economy” we mean an economy driven by industries which use scientific or technological knowledge to develop products and services that bring wealth to a society.

Economists predict that the downturn will be felt keenly amongst the farming, forestry and fisheries sector. Mâori are also expected to suffer as small businesses and tourist operations suffer the consequences of a volatile market.

If we look at the Scandinavian countries for example they have moved over time from relying heavily on sectors such as timber, agriculture or mining to become world leaders in specific technologies which have evolved out of those original industries. Fishing, for example, and marine transport remain important elements of Norway’s economy but have been joined by innovative marine biotechnology and marine electronics.

Here at home we also need to develop new strengths, drawing on knowledge and innovation. As we know, Mâori assets and businesses are concentrated in primary production. We now realise, this leaves Mâori very exposed to the kinds of international economic forces now sweeping over New Zealand.

As Minister of Mâori Affairs I want to make sure that the right policies are in place to advance Mâori economic development in established areas such as aquaculture, energy, tourism and agribusiness.

But we also need to make sure that Mâori explore opportunities to build on these existing strengths to add new approaches.

In this age of information technology, we need to be connected quickly, efficiently, and as my staff keep reminding me, man can no longer live by whakapapa alone - we must be players in the digital web as well.

Redistribution of world power

The second key factor relates to shifts in the global economy.

The inauguration of the new President, and the consequences of the financial crisis in the United States and Europe, have dominated headlines.

Nonetheless, Maori exporters are also already conscious of the importance of the new Asian economic powers and are trying to respond to the needs of these very different markets. Some predict that the new G7 countries by 2025 will be China, the USA, India, Japan, Brazil, Russia and Mexico. Global population trends re-inforce this story of change. We must ensure our Mâori workforce is equipped to take to the world stage.

Resource pressures and climate change

The third major impact will come from resource pressures and climate change Pressures on land and water use are already key challenges for us all.

We seek to be free to pursue innovative uses of resources while at the same time preserving and nurturing our spiritual relationship with our ancestral lands and with the streams, rivers, lakes and the sea and all that is to be found in these. Our economic endeavours can and must reflect the kaupapa that honour the traditions and spiritual values that make us Mâori.

Mâori business, including agribusiness, is under pressure to operate in a sustainable way and to take into account impacts on the environment and on future generations. The concepts of guardianship, of respect for the earth and water, of care for the generations to come are central to our traditions and customary rights. As Minister of Mâori Affairs I want to make sure that the voice of Mâori and the interests of Mâori are listened to.

These kinds of longer term international developments are directly relevant to considering how to minimise adverse effects for Mâori from the current recession, and how to ensure that our people are well placed to benefit from the recovery.

I said at the onset of this speech that I want us all to be bold in taking a leading role in assisting Aotearoa on its path through the days ahead.

Generally, our businesses and organisations are described as conservative; our investment portfolios are careful; our strategic vision is shaped by attention to building capacity and capital development.

We can use this strength - alongside the Mâori edge - to consider opportunities for advancing a multi-level programme that deals with unemployment, while at the same time is concerned with eliminating poverty; and advancing whânau ora.

We know that nearly ten percent of the Maori labour force is employed in the construction industry. This industry is critical in our pathway forward – and alongside that we must be poised to take advantage of the new investment in infrastructure, including the improvement of school properties and state housing stock, roading and public transport projects.

But we can not just carry on with a strategy which assumes exponential growth is the solution – without at the same time educating each other about how to manage in a post-carbon world. That requires, at the very least, energy, social and agricultural reform to prepare for our future.

Ka mate kâinga tahi, ka ora kâinga rua.

We must be brave in assessing the total picture - taking into account environmental, social and cultural benefits, to lead our nation towards a sustainable future.

These difficult times require strong leadership, and just as I am asking you to lead us forwards, I am willing too, to do all that I can.

I am currently considering establishing a Taskforce that will be shaped by the discussions today. Alongside other resources the Taskforce will have its own full-time private secretary based in my own office - this is an indicator of the absolute importance I give to this initiative.

In fact, so critical are the issues around economic growth and the social wellbeing of our people, that I intend to Chair the Taskforce myself.

I want to leave us in no doubt - there is every likelihood that the economic recession could erode the progress we have made to this point. Progress in employment; in business; in wealth creation; in wellbeing.

Professor Tony Blakely, director of the Health Inequalities Research Programme at Wellington School of Medicine, reminds us that during the early 1990s when unemployment spiked at 25 percent for Mâori, Mâori life expectancy flat-lined and in some cases actually reduced in some age groups.

The challenge ahead of us all is deadly serious. We must think of all our populations; all our communities; all our whânau in every deliberation we take today.

The statisticians tell us that in the next twenty years, around 37 percent of the New Zealand population between 15 and 39 years old will identify as Mâori. I was very keen to ensure, therefore, that we had the voice of our rangatahi, represented at this forum today, as it is they who will be leading our future onwards.

I am looking forward to hearing everyone’s ideas, to start afresh, to determine the pathway forward that we will take – a pathway that must be wide enough and sturdy enough to embrace us all.

Finally, I have one simple goal for today. To be “nothing short of outstanding”. Can Mâori meet this challenge? The answer is not just a resounding ‘yes we can’ - our answer - the answer of the Mâori edge is “yes we will”. Today is how to make that happen.

ENDS

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