Key fails to appease Maori party

Prime Minister John Key has failed to dampen the anger of the Maori Party. Photo / Mark Mitchell

The Maori Party is sticking to its warning it could walk out on National over the removal of a Treaty clause in state asset sales plans, despite Prime Minister John Key's attempts to dampen down its members' anger.

Co-leaders Tariana Turia and Pita Sharples yesterday said they would consider walking out on their deal with National if a clause which protected Treaty of Waitangi principles was not extended to new legislation that will cover partial state asset sales.

The Government will release a consultation document on the issue today before a series of hui next week on the plans to sell minority stakes in four energy companies.

The clause is section nine of the State Owned Enterprises Act and requires the Crown not to act in a manner inconsistent with the principles of the Treaty of Waitangi.

After the Maori Party co-leaders' comments, Mr Key said he was confident a solution would be reached but section nine could not be part of the new legislation.

"I'm extremely confident that the Maori Party will remain part of the Government over the course of the next three years ... but we can't carry on with a very general clause under the mixed-ownership model. It just doesn't work."

Although the Government was committed to meeting its Treaty obligations it could not impose Treaty obligations on private-sector shareholders in the mixed-ownership companies.

It was possible a more specific clause would be used instead which made it clear that private shareholders were not bound.

He said section nine was "largely symbolic" and the Government could not find a single instance in which it had been used since it entered the law in 1986.

Dr Sharples rejected the prospect of a narrower clause. It was important to retain the wording of section nine because it was all-encompassing and covered water and other natural resources which Maori were negotiating with the Government over.

"Unless the Treaty clause is kept in there to protect and keep that interest there, then we are going to be up the lake without a paddle.

"If it is taken out or reduced to a more particular clause and not left to apply generally, then it weakens the power of that Treaty clause and itwill not give us the protection required."

Mrs Turia said the Maori Party believed there was value in being in Government, but it would not remain there "at all costs".

"If they remove section nine there will be no reason for them to consult with Maori over these issues so they will actually be denying that the Treaty exists and we are not prepared to accept that. We have to be vigilant and if it comes down to the wire, the Maori Party will have to consider its position with the Government."

Mrs Turia indicated she believed there was a breach of good faith by National for failing to notify the Maori Party about plans to remove section nine, including during negotiations.

She warned that the issue could create problems on Waitangi Day.

"One would think that a Government wouldn't like to be provocative at this time and yet here we are."

Labour leader David Shearer said the standoff showed how unstable the Government was.

"It's very much reliant now, if the Maori Party did walk away, on Act to hold the Government together. It makes it very unstable, I would argue."

- Additional reporting APNZ