Editorial: Right move on Maori land

OPINION: A move by the Government to enable Maori to build homes on land which has multiple owners is both logical and desirable.

For too long Maori have been unable to take advantage of owning land because banks have deemed it too risky to lend on land where the ownership is not straight forward enough for our financial institutions.

But yesterday Housing Minister Phil Heatley announced loans would be available to Maori through KiwiBank and guaranteed by the Crown through Housing New Zealand.

It will not be a flood; the Government has set the system up to guarantee up to 180 loans this year under the scheme.

But it is a start and as KiwiBank chairman Jim Bolger puts it, a tremendous step forward, breaking down a long standing barrier to Maori land development.

Multiple ownership of land has been a strength of Maori but also a hindrance when it comes to lending money for building and development.

Maori farmers in particular have been held back because of the number of names on the ownership deed. In the past, it has prevented many Maori farmers from getting bank loans to improve their property and business, leading to criticism of Maori land lying idle.

Maori land, or land held under tikanga Maori principles, accounts for about five per cent of New Zealand today, or 1.3 million hectares of this country's 27 million hectares.

The New Zealand government has long had an issue with multiple ownership of Maori land, going as far back as 1865 when the Government brought in legislation to limit the number of owners on a title to 10. The legislation was short lived, but illustrates how Maori and Pakeha viewed land ownership differently.

The new scheme means Maori will be able to borrow up to $200,000 to build a house by means of what will be known as a kainga whenua loan. All land owners must agree on the project and the borrower must earn less than $85,000 a year and intend to live in the home permanently.

Some loans will be 100 per cent of the cost of building or relocating a house and it is open to first home buyers. There are also some requirements about the size of the house and building construction.

On the face of it, the rules don't sound restrictive and it may well take some time to get agreement on a building project because of the multiple ownership.

There will also need to be some buy-in from councils on planning rules. But with government backing, the perceived risk has been removed from the business deal between banks and Maori.

Any move that improves the housing and therefore living standards of people is a worthwhile idea.

It will be interesting to see if the idea will be opened up to other banks.

- The Marlborough Express