Māui Rau Report 2022

• Expectations of iwi entities far outweigh the resource base they have to deliver.
• The structure of PSGEs have remained unchanged despite significant environmental shifts.
• Now is the time to understand how and where PSGEs can best position themselves to materially contribute to changing the trajectory for whānau.

KPMG New Zealand has today released its latest report in the Maui Rau Thought Leadership series.  The insights in the report draw on the experiences of individuals who have been deeply involved with iwi entities, along with KPMG’s perspectives, in examining what the evolution of the current generation of Post Settlement Governance Entities (PSGEs) might involve. 

As the organisations that received redress packages following long and drawn-out Treaty settlement processes, PSGEs are responsible for protecting the taonga and legacy and managing the rights, interests and financial assets in these packages on behalf of current and future generations of iwi members.

While the total value of Māori assets has been estimated at almost $69 billion, approximately 5% ($3.5 billion) of this relates to value returned to Māori as a result of Treaty settlement processes and yet still a very small proportion of the value lost.

KPMG Partner and National Industry Lead for Māori, Riria Te Kanawa, says that the expectations of iwi entities far outweigh the resource base they have to deliver.

“So much media and attention is on the estimated $69 billion asset value, but it is not often made clear that the majority of this is not due to Treaty settlements, not in liquid assets, and not $69 billion of annual income.  It represents a capital base from which annual returns are split between funding operations, distributing benefits for today and reinvesting for future generations.  Iwi are not, and cannot operate like mini-governments and it is not uncommon to find situations where iwi are effectively working with $130 - $180 per person per annum to deliver on expectations for this generation.”

The first generation of PSGEs was developed more than 30 years ago and structurally have largely remained unchanged despite significant shifts in the environment in which they operate today.

Te Kanawa says that consistent themes were raised concerning the effectiveness of the current organisational structures in delivering the desired outcomes in changing times for Māori that warrant further exploration. 

“The calls for an approach enabling mana motuhake are getting stronger and need to be thought about in the next evolution. Now is the time to understand how and where PSGEs can best position themselves to materially contribute to changing the trajectory for whānau while enabling the network. This has to be considered in the context of their broader eco-system where multiple entities serve whānau, rather than PSGE’s being the central control and delivery agent.”

The 2016 inaugural edition of the Māui Rau series discussed Māori adapting in a changing world. The second edition delved into the strong themes that emerged from the previous – leadership and entrepreneurship.  The third report examined the organisational disciplines needed to realise the potential for Māori but in the context of a PSGE 1.0 model. The kaupapa for this year’s edition discusses the evolution to PSGE 2.0 and using our past to inform the shaping of the future of PSGEs.

Considering the complexity of the context in which PSGEs operate today, Māui Rau outlines six areas that might be considered en route to PSGE 2.0. It recognises some of the reality that Māori face as they brush up against and interact with government systems and the financial realities and constraints. It also acknowledges that some degree of centralisation is valuable and the balance between what is centralised and what is localised needs to be struck.

The 2022 edition acknowledges that there is no silver bullet for what needs to change now but in the absence of one, it offers some levers for change that these organisations should consider.

Te Kanawa also highlights that the suggestions in the report are not intended to be picked up and applied in every situation due to the range of variations. Instead, the best they can do is offer food for thought and, where applicable, further analysis and adaptation.

“Maui Rau is a kaupapa that has always sought to understand the perspectives of those closest to the issues. This report aims to bring those perspectives together and provoke the thinking and discussions - necessary for us to constructively challenge the status quo.

So let us explore what the evolution to PSGE 2.0 could look like as we try to tackle the genuine issues affecting our people and propel them to use their talent and potential. But note that PSGE 2.0 is only a transition step; it’s not the destination. Let’s not wait another 30 years before considering what PSGE 3.0 might be,” says Te Kanawa.