New Zealand Company

The New Zealand Company formed in 1839 to promote the colonisation of New Zealand.

Two previous attempts had been made to colonise New Zealand. In 1825 a company (the first to bear the name of the New Zealand Company) formed in London and sent out settlers, led by Captain Herd to the Hokianga in the far north of New Zealand. Little of permanence came of the venture. At this stage the political instability of New Zealand did not favour supporting such a colony.

Then in 1837 Edward Gibbon Wakefield persuaded a group of notable men to join him in the New Zealand Association to promote the settlement of New Zealand. However they met with strong opposition in London from the Colonial Minister and from the Church Missionary Society, and the Association lapsed.

Wakefield had planted a seed, however, and the following year several of the intending colonists formed a joint stock company. Former members of the NZ Association joined them and obtained a charter for the New Zealand Land Company in 1839. Once again Edward Gibbon Wakefield provided the driving impetus.

London also had concerns about increasing French interest in New Zealand. Events started to push the politicians towards a declaration of British Sovereignty over New Zealand. The officers of the New Zealand Company knew that such a declaration, if that happened, would involve a freeze on all land sales pending the establishment of effective British control. They had other plans, which involved treating New Zealand as a foreign country and buying the land directly from the Maori: they knew they could get a better deal that way.

The New Zealand Company hastily organised a land-buying expedition, which sailed to New Zealand in the Tory in May 1839, commanded by William Wakefield. A second vessel, the survey ship Cuba, with a team headed by Captain William Mein Smith, R.A., sailed in August and then nine immigrant ships sailed in September, before word had reached London of the success of the Tory and Cuba. The immigrant fleet had instructions to sail to Port Hardy on D'Urville Island where they would be told of their final destination.

William Wakefield began negotiating to buy land from the Maori around Petone, {in the Wellington area} as soon as he arrived in New Zealand, and had concluded several purchases by the end of 1839. Then the Treaty of Waitangi (6 February 1840) declared British sovereignty. Lieutenant-Governor Hobson immediately froze all land sales and declared all existing purchases invalid pending investigation. Hobson sent his Colonial Secretary, Willoughby Shortland, and some soldiers, to Port Nicholson to raise the flag and put an end to any challenge to British sovereignty (the colonists had set up a "colonial council" in March 1840 headed by Wakefield and Smith, and primitive legal institutions).

This put the New Zealand Company in a very difficult position. They did not have enough land to satisfy the arriving settlers and they could no longer legally sell the land they claimed they owned. Despite this they pressed ahead, no doubt hoping that subsequent events would create enough pressure to allow them to proceed within the law.

The original settlement, to be called Britannia, was intended for Petone, at the mouth of the Hutt River. However the ground there was very swampy and the anchorage dangerously exposed. The Hutt River flooded that year. They resolved to move further west within the harbour of Port Nicholson to the area they had named Lambton Bay, now Lambton Quay, in honour of Lord Durham, who had been closely associated with the formation of the Company. Smith and his surveyors laid out the original town blocks and the surrounding reserve known as the town Belt, and began allocating the land.

Despite this setback the colony got off to a good start. Within the first year no fewer than 110 vessels had entered the harbour. Food was abundant, mainly supplied by the Maori, who were already supplying the whaling stations around the coast. Safety and relations with the Maori had been the primary concern of the early arrivals but, initially at least, they were very amicable. The initial purchase of the land had proceeded smoothly with Colonel Wakefield, (William), taking every care to ensure that the Maori understood the transaction and were satisfied with the deal. It was estimated that they paid over goods valued at about four hundred pounds for the land on which Wellington was established. Although this now seems paltry there was another aspect of the sale which, maybe, helped justify the deal. One tenth of all the land the Company was purchasing, urban as well as rural, was to be reserved for the Maori. It was expected that the rise in land values subsequent upon European settlement would more than compensate the Maori for the loss of their land. By the standards of the time this was indeed liberal, although it was based on the land being valued in monetary terms only, a European concept. It did not take into account the spiritual and prestigious value of the land, important Maori concepts.

The fact remains that at the time of the sale the deal satisfied both parties.

However not all the Maori remained happy with developments. When the Settlers decided to move from Petone to Lambton Bay they found it already occuped by several Maori pa or villages. These particular Maori did not want to move. They had sold the land quite happily without anticipating the consequences, imagining that the Maori and Pakeha would be able to share the land equitably. The dissatisfaction from this dispute has continued until the present day and has beenthe subect of a lengthy report from the Treaty of Waitangi tribunal.

The New Zealand Company went on to establish settlements at Wanganui, 1840, at New Plymouth in 1841 and at Nelson in 1842and sent surveyors down the east coast of the South Island to consider further sites, where they made contact at Akaroa with the fledgling French colony there.

However the Company soon go into serious financial difficulties. It had planned to buy land cheaply and sell it dearly. It anticipated that a colony based on a higher land price would attract affluent colonists. The profits from the sale of land were to be used to pay for free passage of the working-class colonists and for public works, churches and schools for instance. For this scheme to work it was important to get the right proportion of labouring to propertied immigrants. In part the failure of New Zealand Company plans were because this proportion was never achieved, there were always more labourers than landed gentry.

But there was another flaw in the plan which made the problem worse. A proportion of the land in the new colony was bought for speculative reasons by people who had no intention of migrating to New Zealand. They had no plans to develop the land they bought. This meant that the new colonies had a serious shortage of employers and consequently a shortage of work for the labouring classes. From the outset the New Zealand Company was forced to be the major employer in the new colonies and this proved a serious financial drain on the Company.

The income from the sale of land to intending settlers never met expectations and came nowhere near meeting expenses. In 1844 the Company ceased active trading. It surrenderd its charter in 1850. The British Government initially assumed responsibility for the New Zealand Company's debts, but bequeathed them to the fledgling New Zealand Government in 1854.