Maori Party’s Iwibank hope
AN ‘‘Iwibank’’ is needed to expand development of Ma¯ori land, housing and business, Ma¯ori Party co-leader Marama Fox says.
The party aspires to ‘‘set up a Ma¯ori bank to administer housing, land development and business start-up loans’’, its economic policy statement says.
It’s 177 years since the Treaty of Waitangi was signed, and yet New Zealand still hasn’t developed a banking system that can cope with making loans to develop communally-owned land.
An Iwibank would require start-up capital from the taxpayer, but Fox envisions it as drawing capital from Iwi organisations and trusts.
The traditional banking system struggles with communally-owned land because banks reduce risk by taking security over real assets like homes, land and commercial buildings for most of their loans.
Then, if a borrower fails to repay their loan, the bank can still get its cash back by holding a mortgagee sale of their home.
But the 6 per cent of New Zealand’s land left in Maori ownership is jealously-guarded.
‘‘Not one more acre’’ was the cry of Whina Cooper 40 years ago in the great land rights march from Northland to Wellington, so securing loans against Iwi-owned land is off the table.
Fox says the one home-loan lending scheme designed to get around that has failed.
The Ka¯inga Whenua scheme under the auspices of Kiwibank was supposed to be the solution, with the bank lending to fund house-building on Ma¯ori land, with the lending secured against the houses, not the land.
As a result, the houses had to be able to be removed intact for resale, if the loan was not repaid.
But the loans were up to just $200,000, which is too low, Fox says, and few loans have been made.
‘‘It’s so loaded with bureaucracy that they haven’t approved any of them. They have approved just 16 loans in nine years,’’ she says.
There used to be an income cap for loans, which carried the culturally insensitive assumption that once aMa¯ori household had risen up the income scale, they qualified to move away from communally-owned land and living arrangements and into the mainstream of private property ownership.
The scheme’s failure means it