Growing frustration among some Ministers with the Minister of Land Information, Eugenie Sage, may see pressure for her to lose that portfolio after the Cabinet reshuffle expected after the Budget.
Sage has just rejected an application by the Oceana Gold Company to buy an adjacent 180-hectare dairy farm to store mining tailings from its Waihi gold mines.
The application was supported by the Overseas Investment Office and agreed to by the associate Finance Minister, David Clark, but where one Minister objects, the application must fail.
It was an extraordinary situation with a Cabinet Minister (Clark) effectively being negated by a Minister outside Cabinet, Sage.
One frustrated senior Government Minister told POLITIK that Sage had become “too dogmatic”.
Minister Clark was satisfied that the investment would result in a substantial and identifiable benefit to New Zealand, which is a criterion for consent under the Overseas Investment Act. However, Minister Sage was not satisfied.
The Overseas Investment Act provides for two Ministers to each independently decide an application like this.
Consent is only granted if both Ministers grant consent.
Ministers have not previously made different decisions under the Overseas Investment Act 2005.
The former Green MP, Catherine Delahunty, who is a prominent figure within Coromandel Watchdog, the long established anti-mining lobby group in the region.
The group welcomed Sage’s decision.
“We agree with Minister Sage that there are far better uses for our productive land than to be used as a dump for toxic waste,” says Augusta Macassey-Pickard, spokesperson for the group. “The existing dam was built on productive farmland, that’s more than enough area dedicated to storing this toxic sludge.”
Coromandel Watchdog has always argued that one of the most negative elements of industrial gold mining is the toxic legacy left, including the vast stores of toxic waste from the extraction process, Macassey-Pickard said.
On Friday, retweeting a Greenpeace tweet recording the Government turndown, Delahunty said: “toxic waste dumps on rural land create long term legacies of pollution and contamination.”
The question that is being asked by some Ministers is whether Sage’s refusal to agree to the purchase by Oceana was prompted by her membership of the Greens and their objection to gold mining or whether it was an objective evaluation of the proposal.
What will concern some Ministers is that though the Government has tightened up on overseas investment in land it is not totally opposed.
He has launched a public consultation on the second phase of its Overseas Investment Act reforms, which is aimed at cutting red tape but also allowing Ministers the ability to consider the broader impact on New Zealand of potential investments.
The consultation follows changes made in late 2018, which banned purchases of residential property by overseas persons and simplified forestry investments.
“To grow our economy and lift productivity we need investment – both by New Zealanders and by overseas investors,” said Parker .
“We know there is scope to simplify our overseas investment rules to ensure that New Zealand remains an attractive destination for productive investment.”
Parker has proposed a range of options.
At the very end of the range of options, Ministers could be granted full discretion, with all transactions only able to receive consent if they were are in New Zealand’s national interest.
“The issues that could be considered under the ‘national interest’ test would be left open and for Ministers to determine on a case-by-case basis. Under this option, the complicated ‘benefit to New Zealand’ test would be removed,” the options paper says.
In other words, whether an overseas investment would be allowed would be almost entirely up to the political judgement of the Government of the day.
What seems to be developing is a view that if the law were to go that way, then a Minister less ideologically opposed to some forms of overseas investment would need to be in charge of the process.