9 May 2006 The politics of tenure review

Dr Ann Brower responds to criticisms of her controversial research on land tenure reform of South Island high country pastoral leases.

For 13 years, tenure review has been portrayed as a Crown land grab, as a raw deal for high country lessees. Discourse analysis of 13 years of news coverage in The Press and the ODT reveals that.

But data on the distribution of land and money indicate that lessees are getting quite a good deal – a bundle of new property rights on more than half of the Crown pastoral estate and $15 million cash. Asking why the Crown would give the farmers such a good deal, my research has touched a nerve (see ODT 3 March, 11 April, 21 April, 27 April). When property rights are questioned, feathers will fly.

Put simply, the Crown has paid $31 million to resume rights to graze sheep on and occupy 42% of the reviewed pastoral land. Given that much of this land is covered with scree and glaciers rather than productive pasture, this sum appears generous.

The lessees, on the other hand, have paid $16 million to purchase a different set of use rights from the Crown. These rights include subdivision, viticulture, golf courses, and any other use allowed under the Resource Management Act (RMA).

Basically, subdivision rights are very different from grazing rights. Leasehold is very different from freehold. And $15 million is a whole lot more than 0.

One of the critics of my study asks if it’s such a good deal for the farmers, why they aren’t they “flocking to take it up?” As it turns out, well over two-thirds of eligible farmers are in line for the process or have already negotiated a settlement.

Response to my research has been polarised. I concluded that, though interest groups and property rights play a role, a long-held administrative myth is driving the results of land tenure reform. This myth is based on the 19th century idea that the administration of policy can and should be apolitical. Once politics gets out of the way, science, expertise, and neutral administrators will be free to operate in an apolitical vacuum to implement the “public interest”.

But in attempting to separate politics from administration, Land Information New Zealand (LINZ) is taking a neutral stance in the exchange. This effectively neutralises the Crown’s vested interest in the pastoral estate. The lessees quite rightly advocate for their interests, while the Crown listens with an open mind. Adherence to this myth of apolitical administration means that there is no one advocating for the Crown in these land reform exchanges.

Property is central to land tenure reform, and central to the debate surrounding my research. Property is not an all or nothing affair. There are many gradations of property ownership. In this case, use rights are separate from title, just as possession is distinct from ownership.

The lessees’ property rights in pastoral leases are very strong, but exceedingly limited in scope. The lessee holds two use rights – pastoral sheep grazing and residential occupation. The Crown holds title and controls all other use rights, including subdivision, golf course construction, planting a vineyard, you name it, in accordance with the RMA.

In pastoral leases, physical land improvements do not constitute ownership. Possession of use rights is fundamentally different from ownership of title. Leasehold is different from freehold. The ability to exclude trespassers from a leasehold estate does not constitute ownership. It just constitutes a lease. Physical improvements do not indicate ownership of land title itself. And trespass rights do not constitute ownership. They just constitute a lease.

Former chair of Federated Farmers High Country Committee, John Aspinall (ODT, 28 April) contends that the lessor and lessee share the value of potential uses (including subdivision) that are currently suppressed while the land is under lease. Respectfully, this is not correct.

The Crown owns the pastoral land full stop. It has leased out only a few of the many rights it holds, not the soil and certainly not title.

There is no shared value of subdivision rights. The Crown holds these rights, definitively and outright.

But any lack of clarity on this matter should be tested in Court. Legal uncertainty is the purview of the Court, not government officials, and much less government contractors.

In the same column, Mr. Aspinall asserts that, to understand a lease, a researcher must consult both parties – lessor and lessee. This raises two questions about research methods: Did I interview lessees? And what are the data sources necessary to understand a lease?

As a study of law and politics, my data sources included interviews with people with past and present leadership roles in interest groups involved in land tenure reform. These interest groups included farming advocacy groups. If this is not obvious, it is because many people I interviewed, especially lessees, did not wish to be quoted directly and certainly didn’t want their names or organisations attached.

Secondly, to understand property rights arrangements, I consulted property theory and the law. For the property portion of my research, my question was not “how do lessees perceive property rights?” My question was “who holds which property right and how strongly?” For this question, the appropriate data source is the law, not lessees’ perceptions.

Property is of paramount importance, but few understand it beyond eloquent and romantic hyperboles. Witness the passion in this 1765 quote from foundational legal scholar, Sir William Blackstone:

"There is nothing which so generally strikes the imagination and engages the affections of mankind as the right of property; or that sole and despotic domination which one man claims, … in total exclusion of the right of any other individual in the universe. And yet there are very few that will take the trouble to consider the origin and foundation of this right."

Property law has moved beyond the Blackstonian view of absolute dominion over property. His is no longer the prevailing legal doctrine. But his characterisation of the passionate, yet unquestioned and misunderstood, descriptions of property still holds true.

Many see property as the cornerstone of the social order. It is worth considering carefully. Considered and open debate on this issue is topical, timely, and positive.

Dr Ann Brower came to New Zealand as a Fulbright Scholar, having just completed a PhD at UC Berkeley. She studies natural resource politics, and lectures in public policy at Lincoln University, Canterbury, New Zealand.