The Treaty Settlement Process: Neoliberalism with Maori characteristics



WHEN THE NATIONAL GOVERNMENT OF 1990-99 came up with the “Treaty Settlement Process” (TSP) it created a winning strategy. No single state initiative has done more to pacify the principal casualties of the economic and social changes of the past 30 years. By laying the foundations of what Dr Elizabeth Rata calls “neo-tribal capitalism”, the TSP interposed a rapidly expanding Maori middle-class between an impoverished Maori working-class and the Settler State elites. Without the TSP, the huge transfer of wealth and resources from ordinary New Zealanders to those privileged elites could not have been accomplished.

By the time the Fourth Labour Government was voted out of office at the end of 1990, its neoliberal policies had laid to waste huge swathes of Maoridom. Whole communities had been devastated by mass lay-offs in the state-owned forests, Post Office and railways, as well as the privately owned freezing-works and car assembly plants. A disproportionately large number of these displaced workers were Maori.

The Treasury’s preferred method of dealing with mass unemployment was to let the jobless rot on a benefit. Retraining and re-employing redundant workers was deemed to be both cost ineffective and ideologically unsound.

The results were entirely predictable. In a frighteningly short period of time all the familiar social pathologies of poverty: drug addiction, child abuse, domestic violence, marriage breakdown and gang-related crime; began to unravel the working-class Maori suburbs of Auckland and Wellington. While dealing with these pathologies imposed a massive fiscal burden on the state, the alternative – an activist government intervening to create jobs and strengthen communities – was dismissed as unacceptable. The whole point of the Douglas-Richardson Revolution was to put an end to state interventionism.

TDB Recommends

The skewed ethnicity of this new “underclass” (as journalists were beginning to call it) did, however, present the new National Government with a problem. Maori nationalist sentiment had grown rapidly in the 1980s – most particularly in the agitation for tino rangatiratanga – Maori Sovereignty. The possibility that these radical ideas might be transmitted to and taken up by unemployed Maori was a source of considerable concern among Pakeha elites. A mass Maori uprising, inspired by tino rangatiratanga, could only be contained by the use of deadly force – a course of action that would almost certainly spark a civil war.

The TSP, by contrast, could serve as an effective diversion from the misery and anger gripping urban Maori. By nominating traditional iwi as the Crown’s key negotiating partners the Settler State offered a sense of historical continuity and by enlisting the talents and shifting the focus of Maori nationalist leaders it deprived the Maori underclass of the tino rangatiratanga firebrands who might otherwise have set it alight.

Even so, it was a near-run thing. The occupation of Moutoa Gardens in Whanganui in early-1995 balanced on a taiaha-edge between peaceful protest and violent insurrection. The Government of Jim Bolger and Douglas Graham (the minister responsible for the TSP) held their hand and the occupiers refused to be provoked. The Whanganui confrontation, which could so easily have ended in disaster, caused the Crown’s negotiators to redouble their efforts.

By the end of the decade the TSP was well entrenched. The multi-million dollar Ngai Tahu and Tainui settlements had demonstrated the awesome commercial potential of the neo-tribal capitalist model. The tribes’ corporate structures were offering employment to Maori graduates, and tribal scholarships were supplying the Settler State with the highly-educated Maori personnel it needed to give bureaucratic expression to the “Treaty partnership” which the New Zealand Court of Appeal deemed to have existed between Maori and the Crown since 1840.

The creation and consolidation of the Maori middle-class which the TSP and the partnership model facilitated has proved to be a shrewd investment on the part of the Settler State. It has been achieved at a fraction of the cost of effectively educating and gainfully employing the tens-of-thousands of untrained and unemployed rangatahi. Indeed, the transfer of wealth (in the form of Crown cash and resources) from the poorest Maori communities to wealthy tribal elites (the Iwi Leadership Group) mirrors neatly the transfer of wealth from the 99 percent to the top 1 percent of income earners that is the hallmark of neoliberalism globally.

The cost – a large urban Maori underclass in the grip of all the evils to which poverty gives rise – has not yet risen to the point where the Pakeha elites feel compelled to do more than refine and expand their techniques for social control. That the new Ministry for Vulnerable Children will feature a large number of middle-class Maori professionals, appointed to ensure that the principles of the Treaty of Waitangi are upheld, even as the children of Maori poverty are made the guinea-pigs of National’s “social investment” ideology, merely reinforces what an extraordinary success the TSP has become.


  1. Yep how true. It’s a constant. I’m experiencing it now. Where the Ngati Paoa iwi entity is focusing on building the balance sheet and feeding the people aspirations? The Crowns representative Rick Barker is in retirement mode and just wants to cut a deal to get his “Settlement” stage bonus(es). Negotiators are dumb enough to buy into Auckland’s Housing market been peddled by MBie through ATEED in Auckland Council …. its as we know, corrupt. But i do have a cunning plan ….

  2. you tell us all what we already know, the top people who run the Iwi’s are laughing all the way to the bank (tax free too…don’t see you lefties bemoaning that almost all Maori Iwi businesses pay no tax) and nepotism is rife. If it were a non maori business that has the level of nepotism i suspect you would be screaming blue murder. So what do you suggest Mr Trotter to ‘fix’ this without you looking like a pakeha sticking his nose into maori affairs/business? not much i will bet. Any others care to give their 2 cents worth and offer up a solution that wont be seen as ‘sticking your noses in’….afterall you have all given your opinions (it’s always a bad verdict) on most of Nz’s successful non-maori businesses!

    • Hey IR iwi are made up of people who “are” related to one another. So using the term nepotism as an example is a bit of an “OxyMoron”. Its no different from a pakeha ma & pa business. Tax advantage. Thats how Capitalism works! He who plays the game better wins isn’t it? Jeezuss! You pakeha’s and your idealistic utopian ideals …. move on.

    • You seem to have missed the point of Chris’ article. It’s not his job to ‘fix’ it. Neither is it yours to ask others for a solution.
      The fix (if any) will be initiated by those affected.

      So typically arrogant of the right to believe it is they who are needed to involve themselves with someone else’s problem and it is they who best know how to fix it.
      Ironic when it is they who created it.

      Don’t pretend you care whether a fix comes about or not.
      You just sit there and continue to feel jealous “that almost all Maori Iwi businesses pay no tax”. Is this even a fact anyway?

    • OK I’m right, let’s make the churches pay tax too ,and the self-employed,and the corporates. Let’s get rid of the nepotism in govt appointments as well. Yeah, a bit of fairness wouldn’t hurt from all these ”nice ” people.

      • Any organisation can call themselves a church and qualify these days. Taxing them is a great idea considering they make most of their income from death, land-banking, poorly run private educational institutions & other government funded programmes, massive donations/koha from those who leave their homes, wealth ect …. its the oldest scam ever! 2000 years+. You pakehas invented the “game” and get upset when others play it better?? Or maybe its just a sign of the times when things are tough we play one part of society off the other?

    • Methinks you are a bit jealous I’m Right.
      Successful Maori business people and entrepreneurs who can make a lot of bucks quicker than you and use all the tax loopholes that you have neglected to use.
      It’s just not fair, is it?

  3. “The TSP, by contrast, could serve as an effective diversion from the misery and anger gripping urban Maori. By nominating traditional iwi as the Crown’s key negotiating partners the Settler State offered a sense of historical continuity and by enlisting the talents and shifting the focus of Maori nationalist leaders it deprived the Maori underclass of the tino rangatiratanga firebrands who might otherwise have set it alight.”

    The TSP is a political “success”, a kind of “appeasement” process, the governments of past and present having conned Maori as a whole into being given the impression that past injustices have been corrected or compensated for, to some degree at least.

    For some Maori they may have regained a feeling of dignity, the iwi leaders have been able to pat themselves on their shoulders, but as Chris writes, many urban Maori seem to be getting little or no benefit through the treaty settlements. Some will argue, they should reconnect with their iwi and hapu and try and take advantage of some benefits they may enjoy by working with their traditional leaders.

    But in the end, this was all a bit of a side show, I reckon, as the settlements are deemed to be FINAL, so there will be no legal coming back to claim or reclaim more, once the last chapter is closed.

    That is where it will eventually unravel. Those that thought they will have some land and finances to work with and prepare for a better future of Maoridom, they will soon enough see, they live in a capitalist and commercial world, where business competes. You may have Maori businesses or even corporations, but they will have to deliver the “profits” or gains for their shareholders and owners.

    If they cannot compete or hold their ground, they will eventually fail and go under. They will perhaps also be forced to sell assets, to survive, and we will be back to square one.

    The same applies to individual Maori or living in small hapu and within their whanau, they are still having to compete on the labour markets and all other markets.

    And when the population grows the land does not grow at the same time, so more needs to be done with it, and smartly. Some though will have covenants placed on it or limited potential for use.

    The world has not changed, that is the world we have, for the treaty settlements that occurred.

    So a bigger plan must be worked out, to ensure Tangata Whenua will have their secure, proud and well protected, advanced, developed place in New Zealand, for ages to come, rather than remain in significant part the poor cousin on the margins.

    Perhaps it is time for a new movement or sorts?

  4. Great analysis. The trick of the right is to take something that could be good and beneficial like the treaty settlements, but turn it around, by making normally good people into greedy guzzling cronies of their ideologies with generous cash and asset payouts and weasel words. Somehow they get tied up in this and can’t untangle.

    Urban Maori got nothing. Less than nothing as the growing underclass has proved.

    A lot has been said about Chinese only owning 3% of NZ land (if you believe Natz statistics, which I don’t) but in the context of Maori only own 5% of land that is a lot in 8 years and is probably a lot higher than 3%. Our country is for sale to foreigners and the TPP will take away any control over Maori land for them anyway.

    • Ahhhh i see it’s all National/Keys fault, well there’s a surprise! Any settlement under Labour was good for ALL the Maori in that Iwi and everyone was happy and the monies spread out from top to bottom? I would be interested to hear your thoughts, as National have settled more than double than Labour did is a bad thing too i guess?…thanks for clearing that up!

      • Wtf is the difference between 3 cents in the dollar compensation under labour than under National?

        Is it Twice as fast a rip off?

  5. The blame game that will come with disillusionment will point in all directions but the right ones and increased racial tension will result.

    Non-Maori in general will somehow be blamed for cheating the urban poor Maori of their promised settlement advantage, while the non-Maori middle class will say: “you’ve had your money, you’re not getting more.”

    Meanwhile, the elites on both sides, profiting from the situation, remain either invisible or sacrosanct.

    Unfortunately for them – and us – the situation in New Zealand will eventually become unmanageable.

    On the other hand, in the meanwhile the elites will have fully embraced globalism, so when the shit hits the fan they will all happily decamp for Hawaii or the GC.

    The only useful way to counter the threat will be for meaningful plans to be made to intervene through multi-layered education, social restructuring and job creation. And the sooner the better. This will require foresight, compromise and commitment on all sides. I doubt if the Nats will be much interested in attending that one either.

    • Nick: The Treaty Settlement is not an “advantage” or a privileged position … its redress for theft of land, cultural degradation over 170+ and if it were to be fully compensated in today’s dollar terms. The Crown would have to handover the Country, but hey, that’s not what has happened has it? Just understand, Aotearoa has got a good deal and a cheap one too. The problem with pakeha is the lack of knowledge of the history of NZ. The brown table has learned how to be corrupt … learned from pakeha (the Crown) how to get the best deal and protect their interests in that context.
      But for most people who whinge and moan about Maori in an advantaged position and perceived privileged part of society, is pure ignorance in some cases but in most is the lack of proper accurate “factual” information regarding Maori, Treaty Settlements & Maori history.
      I agree with the ed, jobs and the get-on-with-it attitude too but when you have a government like this current one, who are refusing to settle unless you provide/spend redress quantum on Central Government responsibilities, buying land to by and build social housing, fund social services in health, welfare & education by dictum. Thats not a negotiation. My cuzzies at the table have painted themselves into a corner at the moment by committing to these things so far but now the people/benefactors are starting to realise that we’re getting dick’d. The concept of Treaty Settlement is for Redress of what happened pre-urbanisation, before the GFC …
      This government is only interested in talking about it and expediting the trickle up. Time for them to go!

  6. so basically what i’ve read so far in the comments is: “leave them alone, they will sort it out themselves” fair enough, what happens to the money when all settlements have been completed? round 2? the younger Iwi members bemoan the fact that the money has been squandered/wasted/embezzled by the older generation and they want to do a better job..and go to court for another settlement….yup!

  7. Cutting across the political/ideological divide here:

    You’ve got to know something is wrong with the process when a person can get themselves on to the NZ Rich List by doing nothing else but treaty law. That’s wealth that was creamed off the top before those in need saw it.

    My view is that the settlement process should never have been tribally based. The majority of Maori today are not associated with any tribe to the extent that they will gain from any settlement and tribalism is an outmoded social structure that is more likely to oppress Maori than advance them.

    If you want to see Maori getting ahead, go to Australia! There they have thrown off the shackles of Iwi and Whanau and have demonstrated they can successfully work alongside and compete with the rest of us.

    • Where do we go if we want to see aboriginals “doing well”? I assume that by “doing well” you mean abandoning their own culture and traditions and assimilating into European settler culture? The French who did the same when the German Nazis invaded were called “collaborators”, and it wasn’t meant as a compliment. When the totally unsustainable white Australia experiment sputters and dies (as energy descent and climate change will force it to sooner or later), the Māori there will not be doing so well, and nor will any aboriginals who have managed to be “doing well” under settler rules. At that point the aboriginals who have resisted the massive environmental destruction caused by an extraction-based economy might be publicly recognised as the heroes they are, despite the fact they aren’t “doing well” by the standards of capitalists and their casually white supremacist fellow-travellers.

Comments are closed.