The chief said that as legal owners of the lakes and rivers used by Mighty River and Genesis, including Lake Taupo and Lake Rotoaira and the upper Waikato River, his iwi were concerned about "privatisation of electricity generation operations on our waterways without us being given any say in the matter".
"The [mixed-ownership] model expressly enables the privatisation and consequential commercialisation of schemes that were previously operated in the national interest. That fundamental change means that we need to revisit the operation of these schemes upon our lakes and rivers."
Ngati Tuwharetoa lawyer Russell Feist said the issue was not the water being used by the power companies, but the fact they were "using our land to store their water and not paying us anything for it".
Although the iwi had been assured by "various ministers" that the asset-sales programme was not intended to adversely affect the iwi's rights and interests, there had been no formal dialogue to establish what those rights and interests were, Sir Tumu said.
Tuwharetoa Maori Trust chief executive Tamarapa Lloyd told the committee the iwi did not believe that Section 9 of the SOE Act which protects Maori interests, and which had been replicated in the Mixed Ownership Model Bill, addressed his iwi's concerns.
Sir Tumu said his iwi wanted talks with Mr Key and Finance Minister Bill English about its concerns and so far it hadn't had the opportunity.
Mr Lloyd said that should the iwi's concerns remain unresolved "our remaining avenues for resolution should negotiations fail is some kind of court proceeding which then raises a red flag during the due diligence process".
"Litigation is an option that's on the table."
Mr Key appeared unaware of either the depth or nature of Tuwharetoa's concerns yesterday. He said Mr English was "quite confident that Tuwharetoa are comfortable in the direction that we're taking".
It was always possible that legal challenges to the mixed-ownership model would emerge, but "I don't think it's likely that that will occur with Tuwharetoa".
But Dr Norman said Tuwharetoa's threat was an ominous sign for the Government.
"I think we're now looking at the potential for a huge battle around this privatisation programme. If iwi take a stand that the privatisation essentially removes their property rights which is the stand they're taking, then that will definitely slow down the Government's privatisation plan."
A petition calling for a citizens initiated referendum opposing the programme is to be launched this morning in Wellington.
LEGAL GLITCH
* Ngati Tuwharetoa is threatening legal action to halt the partial sale of Mighty River Power and Genesis Energy.
* It wants a share of the private sector profits to be generated from the use of its land.
* A legal challenge could delay the partial asset sales programme.
