Oravida and the water that no one owns

Written By: - Date published: 10:44 am, April 21st, 2016 - 85 comments
Categories: john key, national, same old national - Tags: , , ,

Oravida site accessed 04032014_new_20131023_02

Penny Bright will be pleased.  Apparently in New Zealand no one owns water.  We should stop paying our water rates bills immediately.

National has made the claim for a while.  The latest invocation of the belief was made by John Key on his visit to China.  From Stuff:

Key told reporters in Beijing that governments had operated under a “long-standing principle” that water did not belong to anybody, and could not be sold by the Crown.

“The point is that no-one owns water, and if we’re going to start charging for it, then arguably we’d have to be consistent and charge a lot of people.

Prime Minister John Key says only “a very tiny amount” of the water used in New Zealand is bottled and sold overseas.

That means Meridian, when it gets its water and puts it through its hydro schemes, they would need to pay for that water, and Meridian aren’t going to pay the bill, so you the consumer are.”

Key said the access permits were only temporary, while only 0.004 per cent of all water used in New Zealand was bottled and sent overseas.

“It’s worth putting a bit of perspective on it…it’s a very tiny amount.”

Holy false equivalence.  Apparently having water drive turbines on its way down a river or domestic water use is exactly the same as bottling it and selling it overseas.  And it is fundamentally wrong for Iwi to have any rights to water even though water is a taonga that was protected under the Treaty of Waitangi but it is fine for corporates that donate large amounts of money to National to sell it at a profit.

And yes the amount may be only a small proportion of all water in the country but explain that to a Canterbury farmer next time they are suffering from the effects of the latest drought.

It seems that the Government’s enunciation of rights defaults to what is best for business and farmers.  But given its preference for market driven solutions to all problems you wonder why the Government has not considered water pricing.

The Government is currently consulting on the future of fresh water policy.  The Parliamentary Commissioner for the Environment in her submission said this:

There is no mention of water pricing, although pricing is the standard way of dealing with such problems.

Pricing incentivises technical efficiency, and it enables trading so thatwater can ‘flow’ to where it is of most value.

It is not surprising that water pricing is controversial – paying for something which Nature provides freely seems wrong and unfair.

But it makes economic sense to price water in catchments where it is scarce (or likely to become so) and it is being used as an input to production.

Embarassingly for the Government it has been disclosed that Oravida has a contractual right to export hundreds of millions of dollars of fresh water at the annual price to the local authority of $500.  John Key is relaxed about it but the optics are not good.  Stone Shi and Julia Xu, directors of Oravida are members of Key’s current delegation to China.   Judith Collins husband is also a director and the company regularly donates to the National Party.  Of course there is nothing to see here and nothing to worry about.

If the issue starts to register in focus group land then no doubt it will be all Labour’s fault.  And some obscure link between a relative of a Labour MP will be used to attack and divert.

85 comments on “Oravida and the water that no one owns”

  1. roy cartland 1

    And Oravida’s slogan is “Water the way nature intended”.
    Let’s just permanently reset the year to 1984 and be done with it.

  2. save NZ 2

    Absolutely shocking!

    I pay Auckland council, metrowater for water here in Auckland and I’m not paying $500 for $233million worth of water. Oh but I am not an offshore corporation run by Natz family members as directors.

    How about the Maori party, they are the Natz partner, do they agree with millions of dollars of water being shipped off by Natz cronies….

    Quote from norightturn

    “Oravida has a consent to 146 million litres of ground water a year and the regional council says Oravida pays an annual compliance charge of around $500.

    Oravida markets the water at $1.60 a litre, meaning if all 146 million litres were sold it could be worth $233 million a year.

    $500 for a $233 million revenue stream? This is simple plunder. But its a perfect example of why we need to price water: to ensure that we actually benefit from our resources, rather than letting them be effectively stolen from us for beads and blankets.”

    • Draco T Bastard 2.1

      I pay Auckland council, metrowater for water here in Auckland and I’m not paying $500 for $233million worth of water. Oh but I am not an offshore corporation run by Natz family members as directors.

      QFT

    • M. Gray 2.2

      NZ was founded on beads and blankets

    • Rosie 2.3

      “$500 for a $233 million revenue stream? ”

      Kind of like Larry Hagman/ JR/Earl Hagaman (alledgedly, alledgedly, rw’ers) paying $105,000 for a $7.5mil return.

      Easy money honey. NZer’s are paying either through their taxes in the Niue hotel deal or through their resources in the Oravida water deal. WE are creating the profits for these companies

    • Mosa 2.4

      233,000,000 will pay for 13 flag referendums

      • Mosa 2.4.1

        This is a lightening issue that Labour should exploit
        This water issue shows up the National party for what it really is ,unprincipled and beholden to business interests the exspence of New Zealanders own resource being plundered for free profit
        Key and his privileged associates make me sick!

    • Et Tu Brute 2.5

      $500 for a $233 million revenue stream? You know that isn’t how it works right? Once you have the resource consent you still have to build the plant, treat and monitor the water, maintain all the machinery involved, hire staff, fill plastic bottles which all have to be bought, cover insurance, ship the product overseas, market it and finally sell every last drop.

      There is no such thing as quick money.

      As for the comparison to Auckland of course even if the water was ‘free’ you still have to pay for treatment and the cost of getting the water from the source to your home and all the staff and safety people in-between. In that regard Auckland City Council pays the same for the water as this company. Both get it ‘free’ out of the ground. Once it is out, they then have to pay through their teeth to do stuff with it.

      • locus 2.5.1

        It’s more complex and expensive to drill oil, build production facilities, transport, refine, package and distribute oil products. And after all that cost, oil products are sold more cheaply than bottled water.

        So why aren’t the water robber barons treated the same way and made to pay royalties? I’d say between 10 and 30% of revenue from the sale of water would be a fair royalty.
        http://www.loc.gov/law/help/crude-oil-royalty-rates/

  3. Sabine 3

    And Jenny Shipley is on the board of Oravida.

    http://www.oravida.com/ourteam.aspx

  4. tinfoilhat 4

    $27 dollars for 12 x 300ml bottles !

    • miravox 4.1

      $27! That’s an expensive packaging and delivery fee.

      • tinfoilhat 4.1.1

        in fairness i expect the transport into china isn’t cheap – although no doubt their profits are still very very high.

        • miravox 4.1.1.1

          I was being a little cynical.

          If no-one owns water and someone goes into a shop, opens the bottle and drinks the water then replaces the lid, they’re not guilty of theft, right? Also it couldn’t be criminal damage for breaking the seal on the bottle because that was just to protect the free water from contamination and spillage (not an issue if you drink it all).

          I guess a small donation to cover packaging and delivery would be in order. But not for the water – it’s free.

  5. Lanthanide 5

    If no-one owns water, how come people are allowed to own land?

    Is water somehow something provided by nature, and land isn’t?

    • Draco T Bastard 5.1

      Things is, people shouldn’t own land as it cannot be removed from the commons.

      • Stuart Munro 5.1.1

        They can’t – there is a property right in land that the state never cedes – allodium.

        Traditionally this would prevent foreigners and some kinds of corporations buying land – but under the extreme far-right kleptocracy we have at present land sales to foreigners are seen as a good thing. They bring foreign exchange in to prop up the illusion that this failing government is somehow marginally competent, and if the investment fails in a few years so much the better: it can be sold again – more foreign exchange! Genius!

        Never mind that these foreigners displace kiwis, and the jobs they might create – minimum wage flunkey hotel staff – are of little or no interest to the educated successors of a frontier economy.

    • miravox 5.2

      Fair point.

    • William 5.3

      And also compare how oil is treated in NZ. The Govt owns all in ground petroleum and charges a royalty for the right to extract it.
      http://www.nzpam.govt.nz/cms/permit-holders/annual-fees-royalties/royalties

      This year oil royalties are forecast to be $220 million.
      We have the fourth lowest royalty rates in the world, that’s been explained as because the risks of exploration here are greater than in the oil rich states.

      The risks of water exploration here are very very low, so by the same reasoning we should be charging very high royalties for water. 90% would be comparable to oil in Oman, Yemen, Libya. Currently we’re charging zero!

    • how come people are allowed to own land?

      Because without the ownership of ‘real’ property, capitalism and the market could not come to dominate and become the necessary basis of our society. Land that is not privately held (effectively a ‘commons’ ) would allow people to live outside the market.

      This is not permissible and is therefore why the first act of colonisation is always to enclose the commons – from rural England to African colonies it’s always the first move that is made in enclosing society itself within capitalism and a market economy.

  6. Truce 6

    Who is Barbara Yan Grieve? She is listed on the companies register as formerly owning large utility companies I’m New Zealand, with shareholders including Michael Cullen and Annette King; a water company in Vanuatu (set to wipe it’s register clean very shortly under a pretense BTW); and is seemingly the main person or one of thw main people facilitating business for large Chinese provinces and its state in Australia (out of Brisbane)?

    • Draco T Bastard 6.1

      Do you have a point?

    • Et Tu Brute 6.2

      Are you sure Michael Cullen and Annette King didn’t hold the shares as Ministers of the Crown? Did they by any chance ‘sell’ the shares in 2008?

  7. Heather Tanguay 7

    Excellent comments, if no one owns the water – why then are we paying Watercare Services, maybe we should all stop paying.
    Yes, it is so interesting to see the Board of Orivida and seeing the direct Conflict of Interest some people have.
    However, I guess we expect nothing else from this Government and they will remain cumfortible and relaxed. It’s not only Ashburton, it would be very interesting to know how many other companies there are. I know of a big one in Hawkes Bay.

    • Adrian 7.1

      So don’t pay. Just collect your water from the creek and install a composting toilet.

      • Molly 7.1.1

        I’m visit and occasionally comment on this site because I believe in fair solutions for all NZers, not just immediate individual reactions such as the one you (jokingly?) propose.

        You may find that many on here are of similar mind.

    • Rosie 7.2

      There’s a number of companies bottling water all around the country:

      “There’s a New Zealand company with a consent in Northland, Chinese interests in Hawke’s Bay, a company from Finland in Tongariro, Coca-Cola taking water in Putaruru, New Zealanders in Tai Tapu, a Japanese company in Kaiapoi and a New Zealand company has just controversially purchased a consent in Ashburton.”

      Read more: http://www.newshub.co.nz/politics/growing-calls-for-govt-to-put-price-tag-on-water-2016042018#ixzz46Q3ZHMSi

  8. Draco T Bastard 8

    But given its preference for market driven solutions to all problems you wonder why the Government has not considered water pricing.

    Under a market system water should most definitely be priced as it’s an incredibly limited resource – taonga indeed. The problem the Nats have is that the only one that can do the pricing and get the pay out from it is the government and so they go the route of no one owns it and thus it’s free.

    Stone Shi and Julia Xu, directors of Oravida are members of Key’s current delegation to China. Judith Collins husband is also a director and the company regularly donates to the National Party. Of course there is nothing to see here and nothing to worry about.

    So the appearance of even more corruption in and by National. Colour me surprised.

    • Keith 8.1

      If a PM takes relevant objective parties with them on these tours that’s one thing and quite acceptable. But Oravida, with it’s National Psrty connections and it’s rather checkered recent past with a Oravida connected Minister of the Crown doing sneaky promo tours in China for it a couple of years back?

      National do not give a flying shit about conflicts of interest do they?

  9. ianmac 9

    Coal comes from our land and mining has to pay to mine.
    Oil comes from our land and extracting it has to pay to extract.
    Water comes from our land but it is free to anyone who wants to bottle and sell.

  10. Draco T Bastard 10

    The liberty of a democracy is not safe if the people tolerated the growth of private power to a point where it becomes stronger than the democratic state itself. That in its essence is fascism: ownership of government by an individual, by a group, or any controlling private power.

    Franklin D. Roosevelt

    Who owns National?

  11. save NZ 11

    Yep under neoliberalism only the poor, middle class pay for water, if you are super rich then low and behold you can somehow grant yourselves over 2 million dollars of rights for just a handling fee of $500 to the council. It helps if your spouse is a government minister too.

    That is how inequality is growing, locally, nationally and internationally and that is why we are getting deflation in the western world. There is so many rip offs inflicted on so many people and they are so busy working for wages that do not keep up with inflation, that they have nothing left and that is why the panama papers are going to keep going. Journalists have found out where the money went, how it got there and the powerful figures that are funnelling money this way. This is the tip of the ice berg and the largest firms doing this off shore work have not been audited yet.

  12. Colonial Viper 12

    As has already been pointed out. Fresh water will become the most precious commodity in the world within the next 40 or 50 years.

    • Rosie 12.1

      Exactly the reason why we have to hang on to it. We need to future proof our domestic supply not just literally give it away. Giving it away now just weakens our position in the future. We look like a soft touch with our resources.

    • TC 12.2

      Yup and one of the dealers who spotted the sub prime impolsion and bet on it as depicted in ‘the big short’ is now focused on water as his next big money bet.

  13. joe90 13

    Apparently having water drive turbines on its way down a river or domestic water use is exactly the same as bottling it and selling it overseas.

    Gravity huh, you can’t explain it!,
    /

  14. Ed 14

    There does seem to be a need for revising the way water consents are granted, based on the use of the water. A grant for a farm for irrigation purposes could recognise that a proportion of the water will return to the river, or seep through to aquifers closer to the coast. A grant for bottling would recognise the loss of water flow as for agricultural purposes – a right to take water within say 1 km of the mouth of the Manawatu River may be more easily granted than one 200 km up a Canterbury river. Timing may also be important – irrigation in January / February may have a bigger effect on water flow in a river than in June/July. It may be that to balance water use, bottling from a particular river needs to be reduced in January (when it may be convenient for staff holidays anyway), and increased in winter. Critical are the competing needs for the resource – if we don’t mind a lot of Canterbury rivers going dry we may only need rationing down the length of the river so farms at the top are not the only ones able to irrigate. If some uses result in degradation of quality there may be charges for use. Some averaging is also needed so that entitlements are not wiped out be the earliest claims taking all that can be used – a change of use from cattle or sheep to dairy should not be stopped because the next door farm got in first. that also suggests that usage rights should not be too long term – as weather conditions change, adjustments may be needed to keep the scheme fair. Balancing water quantity and quality for recreational uses with profit-making use is more complex than can be solved by overturning democracy – scientific advice is needed, and any government should want to balance needs while maximising economic and social good. This government is increasingly entering into long term contracts for private gain with little attention to long term implications – I accept that anyone building a factory will need more than 3 years guarantee of supply, but a robust system should enable confidence with similar certainty to the prospect of rain continuing . . .

    • Draco T Bastard 14.1

      A grant for a farm for irrigation purposes could recognise that a proportion of the water will return to the river, or seep through to aquifers closer to the coast.

      And thus we should be charging them for the pollution.

      Some averaging is also needed so that entitlements are not wiped out be the earliest claims taking all that can be used – a change of use from cattle or sheep to dairy should not be stopped because the next door farm got in first.

      Actually, that’s pretty much exactly what market economics means. If you want to change that then you need to put in place regulations.

      Balancing water quantity and quality for recreational uses with profit-making use is more complex than can be solved by overturning democracy – scientific advice is needed, and any government should want to balance needs while maximising economic and social good.

      You’re assuming that profit making and environmental protection can be balanced in favour of making bigger profits on farms. It can’t be. Or, to be more precise, the balance exists with the amount of farming in NZ declining.

      but a robust system should enable confidence with similar certainty to the prospect of rain continuing . . .

      Climate Change has NZ becoming drier and more susceptible to drought.

      • Ed 14.1.1

        So based on impeccable free market doctrine, and even ignoring the desire for clean water; 500 is not enough for Oravida’s water contract, and the uncertainty of long term rain means that 35 years is too long?

  15. weka 15

    “And yes the amount may be only a small proportion of all water in the country but explain that to a Canterbury farmer next time they are suffering from the effects of the latest drought.”

    Two things here. One is that the proportion of the total water in the country is irrelevant, and Key’s comment reveals him for the complete ecological illiterate that one would expect him to be given National’s policies. We have to look at the take from every individual watershed and assess the impact of that take on not just the water systems but the whole ecosystem in that specific location. What is happening with water take in Ashburton is not relevant to the Waikato.

    The other is that Canterbury farmers are their own worst enemy. The droughts we are experiencing aren’t that bad, it’s that the kind of farming we are doing is just plain wrong for the location and climate. The solution to that isn’t to be concerned about Canty farmers having more access to irrigation, because the irrigation is a huge part of the problem in the first place. If I had to choose between diary farms in Canterbury or Oravida selling capped limit bottled water to China, I’d choose Oravida even knowing full well how evil they are. I think we have to be very careful not to use the wrong arguments politically, and supporting industrial farming is not a useful one.

    • Ed 15.1

      Nobody owns the airwaves, but we found a way of selling of spectrum to interested oligarchs. We also privatised electricity generation which required little capital input in some areas – but we are now providing a return on capital to the artificially generated capital from the sales. Perhaps there should be annual bids for water in some areas?

      • weka 15.1.1

        Or just keep water for essential collective services (drinking water, sewerage, electricity generation, limited irrigation etc) and recreation, and prohibit commericialisation. Far simpler and far far better for the environment.

  16. MARY_A 16

    Is this a case of another (natural) asset being pilfered, to fill the coffers of the wealthy and corrupt foreign corporates with direct government connections?

  17. ianmac 17

    I saw on TV a year or so ago about bottling water in Fiji. It was being exported at huge profit. Fiji changed the rules and the firm had to pay a royalty. A small amount per litre I think. Anyone?

    • ianmac 17.1

      Why not in NZ?
      Aha for Google: “Shortly afterwards, an increase in the tax from one-third of a Fiji cent per liter to 15 cents per liter for producers over 15 million liters/month which at that point in time applied only to Fiji Water, led the company to shut down its Fiji Island offices on November 29, 2010. This raise was to raise Fiji Water’s tax contribution on to the Fiji Government on the F$150 million (AUD 82 million) they exported each year from F$500,000 to F$22.6 million.[9] The next step for the brand was thought to be a move to New Zealand.[10][11][12] However, after threats from the government to give the well to another company,[13] Fiji Water announced its intent to resume operations and accept the new tax levy.[14]
      https://en.wikipedia.org/wiki/Fiji_Water

  18. Atiawa 18

    A Labour led Government will set up a new SOE “NZ Water”.
    The enterprise will become the sole exporter of NZ’s precious natural resource. Four bottling factories will be established, two in the North Is and two in the South. 300 new jobs will be created across the business.
    It is believed that the business will have opportunities to grow substantially over coming years and will contribute significantly to the country’s GDP, which all citizens will benefit from.

    Now. Who would squeal about that Labour/Greens policy?

    • Colonial Viper 18.1

      It will help reduce NZ’s debt and pay for superannuation.

      It will also bring down our trade deficit.

      I think this selling off of our real physical resources for digital numbers is the way of the future.

    • Draco T Bastard 18.2

      Now. Who would squeal about that Labour/Greens policy?

      Me because it’s environmentally destructive.

  19. Matthew Hooton 19

    There should be a price on water and everyone should pay it whether cleaning their teeth, irrigating their farm or exporting it to China – so that the water goes to whoever has the highest and best use for it. We already pay to clean our teeth (in Auckland anyway) so farmers and water exporters should pay too. As it happens, I would expect orivida has a better business model than Fonterra and would end up with the water in question, and good on them. But they should pay.

    • The Gormless Fool formerly known as Oleolebiscuitbarrel 19.1

      Yes. This is right. The Nats are stating the current law but it needs to change.

    • Colonial Viper 19.2

      Under your scheme, water, like all the rest of the nation’s resources, will go to those who have the money.

      • Gabby 19.2.1

        I’m sure Hootie means there should be a price on water for people intending to sell it. To incentivise responsible business practice if nothing else.

        • Colonial Viper 19.2.1.1

          hooten means that water should be turned into a profit making commodity, and that access to water should not be a human right.

          • Matthew Hooton 19.2.1.1.1

            Correct. But I’m not talking about turning it into anything. People already pay for the water that is piped to their houses (at least in Auckland).

    • adam 19.3

      You really are the monster Adam Smith warned us about 🙂

    • mickysavage 19.4

      The result may be that we export pure water and not milk and not produce a huge amount of greenhouse gas. I think we should reserve judgment on the proposition.

      • Matthew Hooton 19.4.1

        exactly right

      • Sabine 19.4.2

        How much would the WINZ subsidy be to cover the water costs for people that are out of jobs, ill and / or retired?

        Also would Water collection of run-offs then considered theft?

    • Stuart Munro 19.5

      No.

      Water for ordinary living purposes is free. Water to sell you must pay for.

      Turning a buck by selling something you got for free is immoral – same with web copyright in countries not sold out to Hollywood – viewing material free is one thing, profiting from redistribution is theft.

      Gnats are crooks and must be dispossessed of their phoney water ‘rights’. (Legal principle of not allowing profit from wrongdoing). Their successors must pay a modest fee and their right to draw and bottle will be carefully controlled with consent and consultation with local communitities.

    • Ad 19.6

      Agreed.

      But that’s not enough. As an essential utility, the price of water should be regulated. This will force the water utilities to not bloat their asset base with wasteful capex that loads onto the price.

    • Sabine 19.7

      a business model called Jenny Shipley, Judith Collins and access to the PM?

      a truly priceless business model ey?

  20. Gristle 20

    It’s easy enough for the government to differentiate between water going off shore in bottles or tanks and that which is used here.

    Mind you, Fonterra might want to claim a rebate as it extracts water from all that milk powder it exports.

  21. Jack Ramaka 21

    The NZ Natzis are controlled by the USA Natzis, New Zealand needs to wake up to what has been going on the last 100 years, the average New Zealander has been shafted by the system which has been infiltrated by the Natzis and dear I say it The ****** Brotherhood?

    All in the name of greed the Maori People and Hard Working New Zealanders have been shalfted by The Filthy Few, NZ Wealth has been taken by stealth-Fact!!!

  22. Hanswurst 22

    Ah yes, the usual hamfisted reasoning from Mr. Key. On the one hand, it’s all a matter of principle, “No-one owns water”; on the other, it needs to be put in perspective, because it’s just a fraction of a percent of NZ’s water that’s being bottled and sold. You can’t be both principled and pragmatic on the same issue, Mr. Key. Of course, he can get away with it, because his arguments are of the ‘common sense’ variety and NZ collectively prides itself on being a down-to-Earth, common-sense nation. The fact that ‘common sense’ is very often heavily at odds with actual sense is neither here nor there, of course.

    • Draco T Bastard 22.1

      The fact that ‘common sense’ is very often heavily at odds with actual sense is neither here nor there, of course.

      Common sense isn’t.

  23. gnomic 23

    “Nobody owns water” So quoth the leader of the current regime. The person who deals with nobody not highly ethical.

    Quite a number of people seem to get the rights to use water at the expense of the nation at large and the wildlife within it for next to nothing.

    Polluting waterways is also more or less free.

    Refilling aquifers from a heavily polluted river of today. Brilliant! Why didn’t I think of that?

    Flogging off water for private advantage. Not highly ethical?

  24. Incognito 24

    Here’s a thought: the rainwater off your roof and your section of land feeds into the aquifer, the grid, so to speak, and you should be able to claim back against what you’ve taken. You could also store the water in tanks for your own consumption or bottle it. I reckon it tastes heaps better than mains water and comes in all sorts of flavours: possum, bird, bird shit, and even aerial spray. People with a real entrepreneurial spirit and skills could get into distilleries and blending; there’s a huge international market for triple distilled tank water, aged in specially designed tanks (oak barrels?), and it’s all 100% pure and 100% Kiwi. Put a Silver Fern on it and you’ll be a millionaire in no time. The dairy industry will eat its dust.

  25. Hennie van der Merwe 25

    Botswana is a mostly semi-dessert, land-locked country with a relatively small population by African standards yet it is the only country in Africa with a thriving economy. (for years it had the highest per capita foreign reserves in the world)
    When diamonds was discovered by De Beers the then President, Sir Seretse Kgama, on behalf of the government entered into a joint venture 50/50 with De Beers. Botswana had the diamonds and De Beers the capital, infrastructure, market, etc. This agreement ensured that Botswana citizens received their fair share of income from a natural resource that belongs to all of its peoples. It has been a success since inception and both parties have benefitted from the relationship and has enabled Botswana to establish a unique economy in Africa.
    IMO water is like coal, petroleum and all other minerals a natural resource belonging to the peoples of the country. It is government’s responsibility to manage its exploitation/ usage on behalf of the people, not to allow mostly foreign entities to plunder with almost no benefit (in relation to gains made by exploiters) for the peoples. In a post above it was stated that projected oil royalties for the year is $220m – how does that compare with 50% of the profit (before tax dodges and royalties) of the foreign companies involved?
    It would be interesting (if someone can calculate it) what the contribution to government revenue would be if we owned 50% of all companies exporting NZ natural resources.

    https://en.wikipedia.org/wiki/Debswana

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