Tenants in our own land

Written By: - Date published: 12:55 pm, January 14th, 2012 - 54 comments
Categories: assets, overseas investment - Tags:

See Landcorp planning to pay $18m a year rent to a government-linked Chinese firm to run the Crafar farms. So New Zealand is in the enviable position of having to pay rent to foreign owners to farm our own land. Key promised we wouldn’t be tenants in our own land. What’ll be Key’s priority: cutting Kiwi workers’ wages or keeping our land in Kiwi hands?

Here’s what Key said about Crafar farms last year:

“As a general and broader principle I think New Zealanders should be concerned if we sell huge tracts of our productive land.”

“Now, that’s a challenging issue given the state of the current law and quite clearly it’s evidentially possible and has been achieved that individual farms can be sold. Looking four, five, ten years into the future I’d hate to see New Zealanders as tenants in their own country and that is a risk I think if we sell out our entire productive base, so that’s something the Government will have to consider.”

Landcorp put in a bid for about $175m for the farms but it was turned down. Pengxin is thought to be offering about $200m. For the sake of $25m from a government that regularly throws far larger sums to bailout out private companies, we could end up paying tens of millions in perpetuity for our own land.

When Key eventually comes back to New Zealand from holiday, will his first move be to help a company cut the wages of 300 workers or to keep $200m of New Zealand farmland in New Zealand ownership?

The answer will be telling.

54 comments on “Tenants in our own land ”

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  1. RedLogix 1
    14 January 2012 at 1:24 pm

    Do you have a link to an original article Zet? Or is there some other source? Not quibbling, just curious.

  3. RedLogix 3
    14 January 2012 at 2:25 pm

    Interesting. I’ve assumed that the absurdly drawn out delay in annoucing the OIO decision… it’s what over 10 months now… must be due to some deep internal runctions in the National Party.

    What I do know for certain is that a lot of farmers are deeply disturbed by this turn of events.

    The other possibility is that with current dairy prices, the banks are probably quite happy to keep on farming the property for cash. It’s probably quite good returns.

    • Lanthanide 3.1
      14 January 2012 at 5:08 pm

      The farmers should be bloody worried.

      All of their so-called capital gains are just numbers on paper if no one has the cash to buy them. If they want to keep the land in NZ hands they’re going to have to take large cuts to their paper figures, probably often on the order of 40-50%. Otherwise the land is going to have to be sold offshore, which basically means China.

      Going to be interesting what happens to the farming sector over the next 20 years.

  4. Conditional 4
    14 January 2012 at 2:45 pm

    The hiding of this land deal because of the election has a very very bad smell to it.

  5. queenstfarmer 5
    14 January 2012 at 3:03 pm

    Not as telling as the fact that you fail to mention that Labour approved the sale of 650,000 hectares of land to foreigners when last in Government – vastly more than the Crafar land that you are suddenly up in arms about.

    • RedLogix 5.1
      14 January 2012 at 3:09 pm

      Umm yes.

      According to this NBR article:

      “New Zealand farmers can’t buy land in China but overseas buyers are snapping up farms and other valuable land in New Zealand at a rate of more than 107,000 hectares per year for the past five years (2006-2011 OIO figures). That’s 10 Crafar Farm transactions every year.”

      And no, not one single regular author at The Standard has been happy about it. And most certainly those of us who are Green Party members can point to party policy opposed to this very, very bad trend.

      So no the old ‘Labour did it too’ argument is kinda weak cos no-one here is going to rise to the bait.

    • Colonial Viper 5.2
      14 January 2012 at 3:11 pm

      qstf – Labour do something shit like selling off our productive farm land (a policy they have completely changed now – or weren’t you paying attention in November) so its OK we keep making the same mistake with National???

      • queenstfarmer 5.2.1
        14 January 2012 at 3:45 pm

        … a policy they have completely changed now – or weren’t you paying attention in November…

        Oh yes, I certainly did notice that Labour happily allowed vast amounts of land to be sold to foreigners right up until they lost power, happily collected all the revenue and other benefits generated, and then as soon as they lost power suddenly started condemning the current Government for doing the same thing (despite the current Govt approving far less sales than Labour ever did). Unfortunately this sort of hypocrisy seems to have become deeply ingrained in Labour. Hopefully the new leadership will change that.

        • RedLogix 5.2.1.1
          14 January 2012 at 3:58 pm

          Parties can and do change policy.

          During the term of the last Labour government, and especially while land prices were rising, everyone and his dog was farming for capital gain. Rich foreign buyers only pumped that process along, so not a lot of people… other than the Greens … were all that exercised by it.

          Put yourself back in time and imagine the outrage if Dr Cullen had tried to limit land sales. Hell they copped enough flack for trying to make efficient light bulbs mandatory.

          All the same it was a bad policy and now with new party leadership Labour have changed it. And of course the Greens were simply right along.

          This kind of really stupid ‘yeah I know it’s wrong but you guys did it too’ argument just gives everyone the shits. Apart from being a stupid distraction, what’s the point?

        • Zetetic 5.2.1.2
          14 January 2012 at 4:02 pm

          Labour’s policy at the election was to effectively block the sale of farmland by increasing the minister’s power to turn down applications and to change the default assumption from approve to reject.

        • Jum 5.2.1.3
          14 January 2012 at 5:18 pm

          queenstfarmer

          And I remember NAct screaming blasphemies at Clark and Cullen for refusing to sell off the airport land to a Canadian Pension fund. Labour were already realising that too many foreignors in control of New Zealand assets was not a good thing.

          Also, lining Labour sales up against the plans to sell off all the other SOEs NActMU has got its Tony Gibson’s and other strategically placed CEOs on to prepare SOEs for sell off is in no way comparable.

          Thieving Key couldn’t even leave a small stone back in Antarctica; he just had to steal — something. No doubt, given the forces currently circling around the Antarctica treasuretrove, he wasn’t there to just look at the white stuff. No; he’ll have a little booklet with measurements on it that his masters have told him they want carved off and how to sell it to the idiot New Zealanders.

          There’ll be another little booklet of measurements of New Zealand land and assets that will be sold off with or without Kiwis’ permission. It’s a done deal; only the details have to be forced through. The current ‘detail’ would be the job security of over 1000 family members via the POA betrayal.

        • Liberty 5.2.1.4
          15 January 2012 at 9:51 am

          There is a very simple reason why Labour is being hypocritical. Labour sold some land to Americans . While this sale of productive land might be to the dreaded Chinese. We can’t have that as it will upset there opposition partner Comrade Peters. Who as Minister of overseas junkets in the last labour government. Refused to sign the free trade deal with china. One of the few positives of the last labour government.

          • Colonial Viper 5.2.1.4.1
            15 January 2012 at 11:26 am

            Hey Liberty you must have been asleep in Nov…you know when Labour campaigned on NO ASSET SALES, and also stopping almost all farm sales over 5ha. in size.

            BTW what is your rationale around keeping doing stink things now, just because stink things were also done in the past?

            This will be interesting to read.

    • The Chairman 5.3
      15 January 2012 at 10:58 am

      They also opened the door for PPPs.

      Hence, they are no longer in government, took a thrashing at the last election, changed leaders twice, and are trying to reconnect with their grass-roots for a second time.

      • Colonial Viper 5.3.1
        15 January 2012 at 11:27 am

        If they are trying to reconnect with their grassroots they sure have a funny way of going about it.

  6. Pundit X 6
    14 January 2012 at 3:17 pm

    David Cunliffe issued a press release yesterday but the MSN doesn’t appear to have picked up on it..
    He said: New Zealanders are set to become tenants in their own land under the Government’s policies despite John Key saying two years ago he didn’t want it to happen, says Labour’s Economic Development spokesperson David Cunliffe.

    David Cunliffe said that news that Landcorp may pay about $18 million a year to rent the Crafar farms from offshore-owned Penxgin, which is set to buy the farms, would see a publicly-owned New Zealand company renting New Zealand farmland from a foreign conglomerate.

    “Labour does not want to see New Zealand taxpayers becoming sharemilkers for a foreign multi-national.

    “That is not the path to creating economic wealth and strength for New Zealand,” David Cunliffe said.

    “Landcorp, which made an earlier, unsuccessful bid of its own for the farms, would clearly prefer to buy the farms than rent them, but it needs government backing to make its tender competitive.

    “It seems, however, that despite John Key’s fine words of two years ago, that the Government is content to let the farms fall into foreign hands and then lease them back,” David Cunliffe said.

    “The failure to act to keep Crafar farms in New Zealand hands bears close resemblance to National’s asset sales policy. Both would see strategic assets go into foreign ownership, with New Zealanders paying the price to send millions of dollars in profits offshore.

    “Where do National’s priorities really lie? When it comes to bailing out finance companies, National is willing to throw around billions of dollars with abandon, but when it comes to keeping strategic assets in New Zealand hands, the Government’s wallet is firmly shut.”

    • Salsy 6.1
      14 January 2012 at 3:30 pm

      Cunliffe knows how to put the knife in, and twist it. If Shearer is too “protected” to wade into the POAL dispute, let Cunliffe at them…
      At least the international media picked it up at least.. http://www.nznewsuk.co.uk/news/?id=26646&story=Key-s–Kiwi-dream–in-tatters

    • insider 6.2
      16 January 2012 at 6:36 pm

      What’sall this ‘our’ land crap?

      The farms were owned by a family called crafar, with generous assistance from westpac (?). I had no share and likely would have got short shrift if I’d tried treating it as my own- walking my dog on it, leaving gates open etc.

      It shouldn’t be forgotten that these fine upstanding kiwi farmers had multiple prosecutions for animal cruelty and pollution breaches, and fundamentally failed as farmers. They are not people I’d like to be associated with thanks so less of the ‘our’ please.

      • Colonial Viper 6.2.1
        16 January 2012 at 6:41 pm

        Its more “our” land than the Mainland Chinese’, don’t you think.

        And yes the Crafar were shit irresponsible NZ farmers there are still those around the place, in rural NZ everyone knows who they are.

        However them being shit farmers is not really an excuse to sell off land which we’ll simply need to re-nationalise one day.

  7. Arandar 7
    14 January 2012 at 3:39 pm

    Landcorp are excellent farmers, using best practice, innovation, ag research and experience to get the best from the land, sustainably. They are the obvious choice of purchaser; since apparently no NZ individual would-be farmer is able to buy the Crafar farms from the receivers. Landcorp owning the farms on behalf of all NZers, returning dividends to the govt and employing and training young farm professionals is clearly beneficial as is the fact that the price of farmland generally may start to find a more sustainable and justifiable level, if it is no longer possible to sell it to cashed up foreigners of any ilk (unless, as individuals, they pass all our immigration laws, and are planning to live on the land and work it themselves).

    It’s madness to sell control of our productive land offshore at any time but especially now with the perfect storm of fuel, fertilizer, food, finance and climate change crises coming at us.

    • Colonial Viper 7.1
      14 January 2012 at 3:47 pm

      It’s madness to sell control of our productive land offshore at any time but especially now with the perfect storm of fuel, fertilizer, food, finance and climate change crises coming at us.

      It seems that the leaders of our civilisation have been taken ill by a collective madness.

      • RedLogix 7.1.1
        14 January 2012 at 3:59 pm

        They no longer even know what is truly in their own best interests….

      • blue leopard 7.1.2
        16 January 2012 at 10:05 am

        “It’s madness to sell control of our productive land offshore at any time but especially now with the perfect storm of fuel, fertilizer, food, finance and climate change crises coming at us.

        It seems that the leaders of our civilisation have been taken ill by a collective madness.”

        Colonial Viper,
        How very true
        Worth repeating

    • Fotran 7.2
      15 January 2012 at 2:08 pm

      Landcorp are only Farm Managers.
      They rely upon real people to actually farm for them – to get up at 4am to milk cows in all weather, and to maintain sound farming integrity. They are only employees not shareholders other than by way of a taxpayer.
      Should the Chinese buy Crafer what is the difference. You cannot pick up the land and take it elsewhere.

      • Jum 7.2.1
        15 January 2012 at 2:37 pm

        Fotran,

        ‘You cannot pick up the land and take it elsewhere.’

        That comment is so wrong on many levels just two of which are the land goes out of New Zealand ownership and income. Factories can be built on land, the milk supplies sent off overseas and the income stays overseas. The New Zealand owned farms are then in competition and their profits dwindle.

        As for the New Zealand consumers, the reduced volume of milk products means a higher cost, and we already understand that economic factor!

        Let them eat Kake says Key from America. But, don’t you normally need milk for that? (I know; let’s go back to wartime and have eggless sponges and, and no butter – (in a deeper voice) – and we were never so healthy as when we were starving… Nothing so useful as a war from time to time to keep the masses at bay… Doesn’t the world turn slowly on the cogs in the intelligent life forms inhabiting the government. (that wasn’t a question).

        The land can also be converted to other purposes. Once land is sold, and continues to be sold, to foreign investors (or even NZ scavengers) the government has less and less ability (sovereign right on NZers’ behalf) to legislate or control that land use.

        The most stunningly stupid part of all this is that we cannot buy land for business in those countries like China, America, etc.

        It always comes back to the same conclusion; just how stupid will New Zealanders continue to be in their blind following of America’s monkey John Key.

        He is not working on Kiwis’ behalf.

  8. muzza 8
    14 January 2012 at 4:33 pm

    Indeed we will see what the true agenda is very soon. Note to the party aligned people, this is not a Red or Blue issue, this is a self sustainable issue..

    We need to not be arguing over who did what and when, because the continuity of agenda , must be very clear by now, and I would bet, about to become even clearer.

    China is the global model being which is vaunted to roll out to the world, and we see evidence of that via, low wages, poor quality/standards/employment laws etc all being used to the advantage of the corporate empires, and at the disadvantage to sovereign nations, and their peoples.Lets see how the FTA may affect NZ is terms of workforce , and imported slave labour

    http://westcapenews.com/?p=1293

    http://laborstrategies.blogs.com/global_labor_strategies/2007/03/free_trade_and_.html

    The discussion about asset sales, re PoAL on another thread is relative to this discussion about potential renting of farmland. I know some people may not see the correlation, but I assure you there is one, and John Key will be front and center lying out of his arse to us all!

    • RedLogix 8.1
      14 January 2012 at 4:44 pm

      and John Key will be front and center lying out of his arse to us all!

      Yes. Most people forget that Key’s last job before coming back to NZ was serving on the Overseas Currency Committee of the US Fed in London. Now that’s actually a pretty senior job; about as far up the merchant banker greasy pole that a boy from a State House in ChCh is ever likely to climb.

      And then with no reason he quits; to become a very lowly backbench MP for a National Party that has just been thoroughly booted out with little to no prospect of power for 2-3 terms.

      Maybe he is just a good ol’boy who made good and wanted to return to his home country to give something back. Or not.

      • Colonial Viper 8.1.1
        14 January 2012 at 4:48 pm

        Key is playing his role as part of the bankster takeover of sovereign governments. Greece, Italy, Ireland have already gone that way. They tried with Iceland but Iceland resisted.

        Portugal and Spain are on the chopping block too. Whoever controls the global money supply controls what governments can and can’t do, what governments can and can’t afford.

        What a farce.

        • muzza 8.1.1.1
          14 January 2012 at 5:10 pm

          Correct – The deal is now to blow the arse out of as many countries as possible before too many people start to realise the plan – ECB will be going into actual printing mode shortly, it kind of already has with swaps, and looks like the FED will be firing them up again also..

          JK is an insider, and the sick thing is, that of the morons who voted for him, many will refuse to see it, ever! Ive said it on these boards a heap of times, mathematically we can’t pay back our foreign debt, its not possible. Some think we can sell our way out of it via mining etc or that we will not have to pay the debt, but that will not be allowed to happen, oh we will get mined, but NZ wont get freedom financially from it! No , no, we are being taken down the same path, and with all the thickos tolerating it, and even applauding Teflon John, we really are in for a tough time!

          So far as this thread is concerned, assisting Landbank with a purchase, there is little chance of that happening!

  9. Frank Macskasy 9
    14 January 2012 at 5:47 pm

    In November, I wrote to Bill English…

    from: [email]
    to: bill.english@parliament.govt.nz
    date: Mon, Nov 14, 2011 at 11:27 PM
    subject: Crafar Farms

    Sir,

    Shanghai Pengxins lodged an application with the Overseas Investment Office (OIO) on or around 18 April, to buy the Crafar portfolio after Natural Dairy’s application was rejected.

    Normally, applications take up to 50 to 70 working days to process.

    It has now been seven months since Shanghai Pengxins lodged it’s application.

    As the Minister responsible for the OIO, is there a reason as to why Shanghai Pengxins’ application has not yet received a decision? Or is the decision being deferred until after the election because of it’s sensitivity?

    Information on this matter would be appreciated.

    Regards
    -Frank Macskasy

    I recieved this strangre response,

    from: B English (MIN) B.English@ministers.govt.nz
    to: [email]
    date: Tue, Nov 15, 2011 at 12:19 PM
    subject: RE: Crafar Farms

    Dear Frank Macskasy

    On behalf of the Hon Bill English, Minister of Finance thank you for your recent email regarding Crafar Farms. Your letter has been passed on to the Minister for his information. As the issues you have raised, however, fall within the portfolio responsibilities of Hon Kate Wilkinson, I have also referred a copy of your letter to her for consideration and reply.

    Kind regards

    Katy Greco-Ainslie
    Private Secretary
    Hon Bill English
    Deputy Prime Minister
    Minister of Finance
    Minister for Infrastructure

    Which was strange, so I wrote back,

    from: [email]
    to: “B English (MIN)”
    date: Tue, Nov 15, 2011 at 3:46 PM
    subject: Re: Crafar Farms

    Kia Ora Katy,

    I am unsure why you have placed this matter before Ms Wilkinson. Her portfolios are,

    Minister of Conservation
    Minister of Labour
    Minister for Food Safety
    Associate Minister of Immigration

    The Overseas Investment Office is responsible to the Minister of Finance, Bill English, or Minister for Land Information, Maurice Williamson, as per the official LINZ website, and Parliamentary websites: http://www.linz.govt.nz/overseas-investment/about-oio/legislation-delegations

    Considering that the issue of the sale of Crafar farms may fall into “sensitive lands” category, this matter would most likely fall under Bill English’s jurisdiction.

    Regards,
    -Frank Macskasy

    And finally got back this rubbish,

    from: B English (MIN) B.English@ministers.govt.nz
    to: [email]
    date: Tue, Nov 15, 2011 at 3:46 PM
    subject: Thank you for your email.

    On behalf of Hon Bill English, thank you for your email.

    Please be assured that all correspondence is read and noted by this office. Where the Minister has portfolio or MP for Clutha-Southland responsibilities for the issues raised, a response will be sent to you in due course.

    While the Minister considers all correspondence to be important, if your email falls outside of his portfolio or electorate responsibilities, or expresses a personal view, then your opinion will be noted and your response may be tranferred to another office or there may be no further response to you.

    Thank you for taking the time to write.

    Authorised by B English, 15 Main Street, Gore.

    Well, that’s about as helpful as Ken Ring predicting Lotto numbers…

    It’s something I was planning on blogging about, as it seems quite apparent that the decision to grant Shanghai Pengxin concent by the OIO was deferred because of the November Election. (There is no other reason that can be considered.)

    Then, with the Xmas/New Year holiday season – more deferral.

    I wouldn’t be surprised if consent to the application is granted in February or March.

    • Anne 9.1
      14 January 2012 at 5:55 pm

      @ Frank Macskasy

      Your communications with Bill English’s office are worthy of wider attention!

      • Frank Macskasy 9.1.1
        14 January 2012 at 6:01 pm

        You’re right, Anne. In fact, I just squeezed off this email to his office again,

        from: [email]
        to: bill.english@parliament.govt.nz
        date: Sat, Jan 14, 2012 at 5:59 PM
        subject: Crafar Farms

        Sir,

        Shanghai Pengxin lodged an application with the Overseas Investment
        Office (OIO) on or around 18 April 2011, to buy the Crafar portfolio
        after Natural Dairy’s application was rejected.

        Normally, applications take up to 50 to 70 working days to process, as
        per OIO guidelines. (Ref:LINZ, Application Assessment & Timeframes,
        Estimated decision times,
        http://www.linz.govt.nz/overseas-investment/applications/assessment#estimated)

        It has now been nine months since Shanghai Pengxins lodged it’s application.

        As the Minister responsible for the OIO, can you explain why Shanghai
        Pengxins’ application has not yet received a decision? I have written
        to you previously on this matter, and received on an acknowledgement
        of receipt of email, but nothing further.

        Information on this matter would be appreciated.

        Regards
        -Frank Macskasy

  10. beachbum 10
    14 January 2012 at 6:24 pm

    I would much prefer the Govt gives Landcorp the money to buy these farms. What concerns me is that Michael Fay is trying to get his hands on the farms as well – (previous NBR articles). That might be just as bad as the Chinese getting them!!!

    • Frank Macskasy 10.1
      14 January 2012 at 6:55 pm

      Beachbum – what is even more worrying is that Fay’s offer was below the Shanghai Pengxin offer. Fay stated that the Chinese offer was above market value. In fact, the following statement was made regarding the Fay-led consortium, as opposed to the Chinese bid,

      “”Our offer is at a price we firmly believe makes sense it that we are paying the right price for the long-term farming future of these properties,” the group’s negotiator Steve Bignell said.

      “Over a certain price level, these farms don’t work.” “

      Which indicates to me that Chinese (and other foreign ) acquisitions of our productive farmland may not be solely profit-based.

      I suspect that some purchases are intended for a long-term agenda, for a time when the Human population on this planet reaches 9 billion (est 2050AD). When that happens, the next resource wars will be for drinkable water and arable land.

      The future viability of some governments will be determined on whether or not they can feed their populations.

      Whoever controls arable land will be in a position of power.

      • beachbum 10.1.1
        15 January 2012 at 9:54 am

        I guess in the end out of desperation maybe in the future we could just get a govt to go and “Nationalise” these assets like some other countries have done in the past – but we are so small we would probably get dealt to.

        The land provides access to plenty of water and mining as well I guess.

      • Draco T Bastard 10.1.2
        15 January 2012 at 12:53 pm

        Which indicates to me that Chinese (and other foreign ) acquisitions of our productive farmland may not be solely profit-based.

        They’re not. Those countries are looking for food security for their own people. Selling that land will bring absolutely no benefit to NZ. Probably bring about significant loss though especially as climate change hits and we find feeding ourselves become more difficult.

  11. Arandar 11
    14 January 2012 at 9:30 pm

    The water wars have already begun, see the Horn of Africa.

    Food, fuel, fertilizer and finance have all ‘peaked’. Our retaining control of our productive land is vital to our survival as a people and a sovereign nation. Perhaps that is already too late?

  12. Hami Shearlie 12
    14 January 2012 at 11:05 pm

    “When he eventually comes back to New Zealand from holiday” – do we really HAVE to let him back in?

  13. Adele 13
    15 January 2012 at 10:19 am

    Kiaora Koutou katoa

    New year’s greetings to you all.

    I find this post ironic in that Maaori have been saying the very same thing for simply ages – we are tenants in our own land. As far as Maaori are concerned it doesn’t really matter whether the ‘landlord’ is that fella, or fella-ess, that lives over ‘there’ or over ‘yonder’ – the injury remains the same.

  14. vto 14
    15 January 2012 at 11:13 am

    The linking of “foreign investment” with “foreign ownership of land” is the biggest lie perpetrated by these politicians. The two matters are separate and they must be called on their deception. Carter is a prime contender.

    Let the foreigners invest in our business, but do not let them wn the land. It can be leased or rented from New Zealanders. There is no need for them to own the land.

  15. Eduardo Kawak 15
    15 January 2012 at 6:31 pm

    Moneybags Jonkey does not care for you or your future. He’s a glorified car salesman. In to make a quick buck for himself and his mates.

    My personal opinion is that foreign interests should not be allowed to own property in NZ full stop – companies or individuals. Make the individual fulfil the requirements to become a New Zealand citizen before handing over a piece of New Zealand to them. For foreign-owned companies, let them operate and own the buildings factories etc… but never, never let them own the land.

    I’d love to see a referendum on that topic – it encompasses asset sales and more.

    New Zealand’s great shame – the prostitute of the South Pacific, peddling all its wares to whoever wants them with pimps like Jonkey holding the door open.

    The fact that foreigners living in New Zealand can vote tells you all you need to know about how little pride is left in this country.

  16. muzza 16
    16 January 2012 at 9:38 am

    http://www.nzherald.co.nz/employment/news/article.cfm?c_id=11&objectid=10778932

    Anyone think that this wage problem will restrict itself to the chefs?

    Welcome to FTA NZ