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Prime Minister John Key’s statement that the government might “ignore” what the Waitangi Tribunal has to say about water rights and asset sales has caused tensions in Parliament and the Maori community.

The Waitangi Tribunal is currently hearing an urgent case by the Maori Council, which is attempting to claim rights to freshwater and geothermal resources. Members of the Maori Council argue that the planned partial sale of Mighty River Power, which operates both hydroelectric and geothermal power stations, would breach the principles of the Treaty of Waitangi. The Tribunal may recommend that the government suspend the sale, which is currently scheduled to take place in September, until Maori rights to water resources have been decided.

Mr Key sparked controversy by stating: “Even if the Waitangi Tribunal found that Maori hold interests in water, the Government would not have to accept the decision.” David Clark, Labour MP for Dunedin North, said Key’s comments were “divisive” and “disrespectful”. Green MP David Clendon said the government was “trampling” over the Waitangi Tribunal, and that it was “disappointing” that after a 1987 court decision that acknowledged Maori have particular rights, “the Council is again obliged to seek a re-statement of those rights”.

The Maori Party, currently in coalition with National, appears the most displeased with Key’s comments. All three Maori Party MPs have voiced their concerns, and have been urged by the Maori Council and Mana to cancel their coalition agreement. In a meeting held on Wednesday July 18 the two parties agreed to continue to discuss the issue.

Jacinta Ruru of Otago’s Faculty of Law said Key showed “arrogance” and was acting “as if the government does own the water”, which contrasts with Key’s recent comments that “no one owns water”. The National Government acknowledged in a 2009 Cabinet paper that Maori water claims were unresolved.

The legal questions about rights and property make the situation a complex one. Ms Ruru said water is a taonga (treasure) according to the Waitangi Tribunal, and that “recognition is important [for iwi], but some iwi want ownership”. She says this “ownership” would follow tikanga Maori (Maori custom), and therefore be “non-exclusive”. Ruru says that once Mighty River Power was sold, the profits would shift from public to private hands, which goes against Maori ideas of ownership.

Another concern is that the uncertainty caused by the ongoing dispute could result in lower returns from the Mighty River Power sale, as buyers would not feel confident purchasing shares in an asset that was clouded by controversy. Counsel for the Crown conceded this point during the Waitangi Tribunal hearing. Green Party co-leader Russel Norman says that the government should not proceed with the sale until the controversy is resolved.

The government has repeatedly stated it hopes to raise between $5 – 7billion from the sales and, for now, still hopes to put 49 percent of Mighty River Power up for sale in September.