Slashing the sky from the sea: Ngāi Tahu's next step in tribal development

Thursday, 9 July 2020

Looking to the future: Ngāi Tahu's Haea Te Awa brings an investment focus to local rūnanga.

A new Ngāi Tahu investment strategy has been put on hold due to the pandemic. But it could still have a big impact on small town South Island. JOHN McCRONE reports.

Phase one for Ngāi Tahu was about pūtea – amassing a $1.2 billion pot of gold as New Zealand’s largest corporate iwi. That describes the tribe’s first 20 years.

Phase two, agreed in principle last November, is going to be about a shift towards regional rangatiratanga, or local self-determination.

In what tribal elder Tā Tipene O’Regan calls a “reset”, a new investment strategy is being hatched – Haea Te Awa – that will see Ngāi Tahu devolve more money and control to its Papatipu Rūnanga, or 18 sub-tribes.

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It should be a significant step for Māori identity in the South Island.

The corporate iwi era saw Ngāi Tahu establish itself as a supercharged South Island cultural, political and economic force. But it was a centralisation that produced tensions.

Signed off: Haea Te Awa progressed at last November's tribal gathering, Hui-a-Iwi, held in Invercargill.

Devolution of the tribe’s spending under Haea Te Awa is intended to allow the 18 rūnanga to better express their own local histories and identities – what it means to be modern Māori in places like Moeraki, Akaroa and Gore.

So, a seismic shift for Ngāi Tahu? Well, it was to have been.

Within Ngāi Tahu, some of the old guard were already resisting. They said Haea Te Awa sounded a foolhardy project. A pushback had started.

And then, right as Haea Te Awa was moving towards its launch this year, coronavirus hit.

Like every business, Ngāi Tahu’s profits have been taking a ding and Haea Te Awa has had to be put on the backburner until the tribe’s financial status becomes a little clearer.

A double brake on the project.

Speaking for Te Rūnanga o Ngāi Tahu (Tront), Julian Wilcox, the tribe’s chief operating officer and – until the pandemic changed priorities – programme lead for Haea Te Awa, was guarded in what he would reveal.

But Wilcox admits there has had to be a rapid rethink. “Haea Te Awa as originally scoped has changed. Regional development will still occur, [just] not to the degree we were looking at initially because of Covid and other issues.”

So a slight sense of having to go back to the drawing board there. Yet it is still a project of central importance to Ngāi Tahu, Wilcox says.

SLICK CORPORATE VIDEO

Details about Haea Te Awa are sketchy. Ngāi Tahu officials have avoided discussing it publicly, saying it is a work in progress.

But a statement following last November’s Hui-ā-Iwi – the biennial tribe gathering held at Invercargill’s Murihiku Marae – stated Haea Te Awa had been signed off in principle.

“Te Rūnanga o Ngāi Tahu approved a new Investment Charter, a new Financial Policy, and a Regional Development Strategy to meet the aspirations of Papatipu Rūnanga. These will take effect in July 2020.”

Ngāi Tahu then posted a slick corporate video on YouTube to communicate exactly what the leadership had in mind.

The video explained Haea Te Awa means “slash the sky from the sea” – a karakia cry for safe passage made aboard the first ancestral canoe as it approached Te Waipounamu, the South Island, some 700 years ago.

Rāwiri Manawatu, a school teacher speaking for the Ngāti Kuri people of Kaikōura rūnanga, spoke of the importance of being able to express Ngāi Tahu’s identity at a local community level.

Manawatu says, as a rūnanga-controlled investment programme, it would fund public art and architecture, creating a new visual presence in the town. “We can normalise what it looks like to be Māori, to be Ngāti Kuri, in Kaikōura.”

Haea Te Awa would also fund rūnanga-level business ventures and land ownership, he says.

“That regional development will support whānau, so whānau can live in Kaikōura and be here with us. It means economic sustainability, it means cultural identity, it means whānau growth within their takiwā (tribal area).”

The intent was clear enough.

Te Whāriki subdivision in Lincoln: Ngāi Tahu Holdings rode the property market for a good return.

During its 20 years as the corporate iwi, Ngāi Tahu had become a rather distant organisation – the Christchurch-based money machine and political player.

Haea Te Awa was being set up to balance that out, using a part of the tribe’s accumulated wealth to allow its people to re-establish themselves again as a visible, tangible, presence in every corner of the South Island landscape.

A JOINT SOUTH ISLAND CLAIM

That was back in late 2019. Whatever direction Haea Te Awa now takes, the motivations remain the same.

A number of senior Ngāi Tahu figures and former officials were willing to speak about Haea Te Awa, but only off the record. “I still have to live in this town,” one said.

But an unhappiness with the way the tribe became taken over by its own corporate success lies behind many of the political ructions of recent times, they agree.

One former executive explains that it started right back when the scattered South Island rūnanga united to fight their Waitangi Treaty claim as a group in the 1990s.

“The Ngāi Tahu claim is always discussed as a singular thing, but it was actually 10 Ngāi Tahu claims bound together.”

It was a smart negotiating tactic aimed at extracting maximum value at a time when nothing about the treaty process was certain. Yet it was always implied the results would flow back to the individual marae, says the source.

“So for example, Dunedin’s historical issues would have been rolled in with everyone else. And you would thus hope that at some point the redress that was secured would get back to Dunedin to address those issues.”

However the corporate iwi model, once created, stuck. It wound up exerting its own gravitational pull on tribal affairs.

At the heart of Ngāi Tahu’s approach was the decision to place its $170 million Crown settlement out of reach in a separate holdings company. A professional investment vehicle staffed mainly by Pākehā wealth managers who could grow the tribe’s asset base.

And Ngāi Tahu Holdings did flourish. It grew rapidly into a $1.2b cash cow with a host of subsidiaries in fishing, farming, forestry, tourism and property development.

The former officer reveals that – infected by its success – at one stage Holdings even tried to break free of its own masters. It proposed listing itself on the stock market and becoming a truly free-wheeling giant of the New Zealand corporate scene.

“There were papers on the table saying they would run themselves as a public company.”

The result would have been Ngāi Tahu losing all say in how Holdings invested.

Centre stage: Tensions grew as Tā Mark Solomon became the public face of the tribe as kaiwhakahaere.

“It would have been reduced to being a shareholder, being told every six months what dividend it was going to get.”

This shows how once you get a billion dollars of capital on the move, it can start to get its own self-interested ideas, he says. A few knuckles got rapped over that one.

NGĀI TAHU’S TIGHT NINE

Another Ngāi Tahu insider says, in similar fashion, Tront central office also came to be viewed as developing ideas above its station. Corporatism overtook it as well.

He says Ngāi Tahu was set up with a political structure to match the fact it was in fact a collection of rūnanga.

Tront, as the tribe headquarters, was accountable in its operations to an 18-strong board of rūnanga representatives. This board elected the Kaiwhakahaere, or tribal chair, from their number.

However tensions grew as Tront took on more and more paid staff and became the dominating core of Ngāi Tahu activity.

Lower profile: Ngāi Tahu's new leader, Lisa Tumahai, is bringing a different style to the job.

On the one hand, this was welcomed. Kaikōura’s Tā Mark Solomon, Kaiwhakahaere following the settlement, became a nationally – indeed internationally – known figure. The embodiment of tribal mana.

“Because Mark was so prominent, he touched everything. Everyone went to Mark, and everything went through Mark,” the source says.

To the wider world, Ngāi Tahu seemed to speak with a single voice. And in Solomon’s time, Ngāi Tahu made its great gains in the political, as well as financial, sphere.

“But the bigger and stronger that central corporate structure got, the sense from the grassroots was that it was getting further and further away. People said the office cost $20m a year to run, and what are we getting out of it?”

The call to devolve the tribe became a running sore point. The Tront board was evenly split with a “tight nine” of rūnanga reps demanding Solomon must go. There were coup attempts in 2004, 2006 and again in 2009.

A symbol of the corporate over-reach became the plan to build a “House of Tahu”, a new headquarters office. “The regions just could not cope with spending $50m on a big glass palace building in Christchurch.”

So the issue Haea Te Awa is meant to address goes right back to the original expectations surrounding Te Kerēme, Ngāi Tahu’s settlement.

And when Solomon finally left in 2016 after 18 years, his replacement, Lisa Tumahai, was elected Kaiwhakahaere on a promise of devolution.

She said hers would be a more low-profile form of leadership. Tront would be run in cabinet fashion with the various rūnanga reps involved, each having a portfolio according to their interests.

And Haea Te Awa then emerged as the financial platform that was going to deliver on the rūnanga expectations of a general move to more action happening on the ground.

EIGHTEEN COST CENTRES

For some, Haea Te Awa might seem the justified way to bring about a greater rūnanga-owned say in control of the tribe’s settlement. But they can also see its dangers.

The key concern is the rūnanga committees are small and amateur, lacking the investment experience or business skills to spend a sudden influx of cash wisely.

“It’s very risky. You’re taking away our consolidated power base by breaking it up to create 18 new cost centres,” one senior figure warns.

Never shy to go on record: Tā Tipene O'Regan says Ngāi Tahu must leave behind the corporate welfare era.

Another agrees. “Some rūnanga are managed by volunteer groups of only one or two dozen people. They might be nicely community-grounded, but they’re not set up to run big sophisticated investment portfolios.”

Tront has advanced Kaikōura’s Whale Watch as an example of a success story – the kind of hapu-level enterprise Haea Te Awa could bankroll in every small town, cementing Ngāi Tahu identity and providing rūnanga employment.

But Whale Watch was a private family business, protests a further source. “It keeps getting touted as a rūnanga business, but it was never a rūnanga business.”

Devolving investment choices to the regions risks a wave of embarrassing failures, he says. Ventures that tip over and have outsiders saying I told you so.

And he says a reason for Tront reticence over Haea Te Awa’s details is that there isn’t yet a concrete plan for its implementation. The corporate video announcing it to the world was getting a little ahead of itself.

“I’ve asked the reps, what’re youse actually talking about? The value of what they intend to devolve is not yet on the table.”

Such a dramatic change in direction for Ngāi Tahu could only follow considerably more internal consultation, the source says. So even before coronavirus forced a pause, Haea Te Awa was going to have to pass a greater level of tribal scrutiny.

LIVING ON WELFARE

The still-tense politics of Ngāi Tahu means most won’t speak openly. But one always ready to give his views publicly is 81-year-old Tā Tipene O’Regan, who helped lead the original settlement negotiations and remains an influential tribal voice.

Defending Haea Te Awa, O’Regan says Ngāi Tahu has to make its break with the “hand-out” mentality fostered by the corporate iwi model. As people are saying, Holdings has become the tail wagging the dog.

O’Reagan says the rūnanga have certainly benefited from Holdings’ economic prowess in terms of a healthy annual dividend.

They are now all receiving an operational income of $600,000 a year and the marae have never been in better shape because of this money tap.

“But it seems a bit fatuous to be creating a big cashflow instrument at the front so the shareholders can live on welfare. You don’t want your shareholders to be basically living in some regional rural gated community waiting for a cheque to come from the capital,” O’Reagan grumbles.

This is what Haea Te Awa is intended to change.

A rewrite of the tribal investment structure would get the financial managers focused on iwi projects in smalltown South Island, rather than chasing yet another housing subdivision up in Auckland.

“[Holdings] has to find room to bring the rūnanga in as participants – present them with joint ventures and opportunities.”

O’Regan acknowledges this might sacrifice profits. Holdings has naturally pursued big safe bets. Making rūnanga-level investment pay will demand rather more ingenuity and risk.

However the rūnanga need to be allowed to become self-determining. And the grassroots iwi also wants the tribe to pursue a more ethical and authentically Maōri investment approach, he says.

Holdings has succeeded in Pākehā fashion by chasing the market. Jumping into dairy farms and property. But Ngāi Tahu’s view is long-term.

“For markets, the future is sometime after lunch next Wednesday. And Ngāi Tahu is meant to be thinking inter-generationally.”

Guardianship is paramount, says O’Regan. The environment and climate change are key concerns. Yet now the tribe finds itself heavily invested in transport businesses – GoBus, Hilton Haulage, Johnston's Coachlines. “Well, how much of your cashflow do you want to have dependent on a major carbon emitter, and how much do you want to be out of that corner?”

O’Reagan says Haea Te Awa ought to be the boldest possible change in tribe investment strategy, otherwise what was the point of Te Kerēme?

BACKLASH COULD BE SWIFT

Others still see question-marks. They say the reality is the rūnanga have got comfortable with their dependable 4 per cent annual return from Holdings. The backlash would be swift if money is frittered away on half-baked local business ideas.

However some also say Ngāi Tahu has shown in the past that it can manage its affairs pretty well. “What the tribe has been blessed with over the years is some really big brains, some creative brains.”

Especially now coronavirus has forced a pause, Haea Te Awa doesn’t need to be rushed into being. It can be allowed to evolve organically.

Then there is the prize. A reclaiming of the South Island as a fully bicultural landscape.

“In a couple of generations it’ll be really exciting to think what Ngāi Tahu can achieve in Gore and on the West Coast, or even little communities like Waihao and Temuka – the impact they could have if they’re allowed to invest on their doorstep,” says a source.

So at the moment, Haea Te Awa may be going quiet for a while. Yet it does still promise to be a natural next chapter in Ngāi Tahu’s developing post-settlement journey.