O'Connor Damien: Crown Pastoral Land (Rent for Pastoral Leases) Amendment Bill — Third Reading 
Text is incorporated into the Bound Volume 
O'Connor Damien: Crown Pastoral Land (Rent for Pastoral Leases) Amendment Bill — Third Reading 
[Sitting date: 01 May 2012. Volume:679;Page:1843. Text is incorporated into the Bound Volume.] 
Hon DAMIEN O’CONNOR (Labour—West Coast - Tasman) 
: 
 I would like to acknowledge the previous speaker Shane Ardern as the chairman of the Primary Production Committee. I think he did a good job with a difficult bill and one that he actually if he is true to himself will admit does challenge some of the basic tenets around property rights—something he has advocated for so strongly—and the ability of a property owner to get a rightful return on that property.  
Before I go any further I would like to acknowledge one person whom I have always respected as a champion of the high country and someone who passed away recently: John Aspinall. He was a gentleman. He was kind. He was generous with his time with his land and with access through his land. I would like having not had the opportunity to go to his funeral to acknowledge in this House his contribution to the high country and in particular to the Walking Access Commission and the good work he did in that area. I would also like to acknowledge Jonathan Wallis who as a new emerging leader of the high country has put in a lot of time to bring this issue before us in Government and the National Government. I am sure he would be happy with the passage of the Crown Pastoral Land (Rent for Pastoral Leases) Amendment Bill but I know that as a smart farmer deep down he acknowledges that this bill does create some dangerous precedents and it is the property rights one that I raise.  
It was interesting as Mr Ardern was going on about it because I think he comes from the dairy industry and I have yet to find a farmer who in times of difficulty has been able to set aside the charges for grazing or set aside reduce or in fact increase the income for a sharemilker if he needs it. The fact is that solid commercial contracts are written into the dairy industry to ensure protection for both parties and indeed that is the only way that commerce can go forward. The certainty which my colleague David Parker referred to is not unfortunately being entrenched by this legislation. In fact we are opening the long-term situation up to greater uncertainty because if there is one thing that this Parliament usually does it is to rectify law that is bad law.  
Although I support the high country—I love the high country—I have not had enough opportunity to be there but I have certainly spent many many days and weeks there in different ways: skiing walking on farms helping chase a few sheep around or chase a few deer. It is magical it is iconic and it is the true New Zealand. The people who have lived and farmed on these properties have done it hard. As the previous speaker said there are some properties that are small that are marginally economic and where families have battled through heritage really and pride to stay on those properties. Indeed when we put up the proposal to implement the law and to actually implement commercial leases on these properties it was going to cause hardship for some which is why I personally went to Treble Cone in the summer—I usually like going there in the winter—and faced a whole lot of high country farmers and passed on that message. They did not all like it but I said “We as a Government are prepared to sit down and offset the increase in rental.”  
The increase in rental was fair and commercial. It did however for some create hardship and that is where we wanted to go. Income-related rentals are something that we have implemented on the basis of reducing hardship for people in their own homes yet the National Government has opposed that time and time again. In fact what it did in the 1990s was to offset the acknowledged hardship and bring in an accommodation supplement which was actually a subsidy to the landlord to ensure that people could afford to be there but it just simply subsidised the landlord. In this case that is probably unlikely to happen and the taxpayer will miss out.  
If I bring the argument round to the start it will create uncertainty and although there may be some joy in the high country from this I am sure that a future Government—and I am not saying Labour; we have not considered it properly at this point—will see that this is not quite right in the same way that the National Government in 1997 saw that the situation with Maori reserve lands was not right and adjusted the legislation to allow the owners of the land Maori to have a fair commercial rate of return and rental that was fair from their land. That situation needed to be rectified and I think a future Government will do the same thing here. I hope that does not create hardship for high country property owners or lessees who have property rights but do not own the land because they might have capitalised into the price they pay for that lease the deal that this Government has put on the table because it is a bit of a false deal and it is one that will not hold up.  
If I come back to the minority view and report as stated in the commentary on the bill here it is quite clear: “Labour supports the continuation of tenure by leaseholders on Crown pastoral lands to ensure sustainable management and productive utilisation of high country leases.” We want them to be farmed well and for the most part they are. We want farmers to have the money to do the pest control to do the weed control and to have a good fair living and rate of return on their efforts just as the landowner the Crown wants the right for a fair rate of return on its ownership of the land. However back to this: “this bill challenges the basic tenets of property rights between the land owner and lessee.” That intervention is not right and as I say will be rectified.  
The calculation of what that rent will be is another dilemma created by this bill because what is being asked of the valuer is to work out the land value exclusive of improvements—that is the land that was there 150 years ago if you can imagine back that far—and calculate the number of stock that could be run on that piece of land. It is a fairly tall stretch I would say. I guess we could have modern-day efficient merinos we have to calculate; none the less it is a bit of a hard ask. So the valuer has to work out how many stock could have been run on that. There were moa around at that time of course as well or going back a little way so I am not sure of the grazing impact of the moa versus the sheep but none the less this is the theoretical calculation that should occur. Then we have to take in stock values. They change every Sunday night depending on the meat companies ringing up their mates and working out what they should pay for sheep or lamb and I do not want to go into that. The value of stock is something that is not fair and objective at all times. So the valuer has to calculate those two things then work out the economic return on that land and then do a calculation—quite a complex one—around what the rent should be.  
 It is quite frankly ridiculous. It is quite ridiculous because the eyes of everyone on the select committee started to glaze over when they thought of the potential for subjectivity in this whole area and that is not what we want for people running a commercial enterprise. They need certainty. They need to know what their rent is likely to be. So this bill although comforting a few people in the short term is not a good long-term solution. We want to see people on the land farming it well protecting the environmental values and protecting the iconic images that sell this country to the rest of the world. Labour cannot support the bill but we do support the high country farmers. We do support their efforts and we want to offer them certainty into the future. What the National Government has done is offer them a lollipop and unfortunately when the sugar runs out they will have to face reality.