The Government will delay the partial sale of State Owned Enterprise Mighty River Power in the wake of fierce opposition and unsolved water ownership claims.
Prime Minister John Key made the announcement after a cabinet meeting today that the sale of Mighty River Power will be delayed until March next year.
The decision comes after the Waitangi Tribunal ruled the move to float part of the SOE without taking Maori water rights into consideration would be a breach of the treaty.
"To be successful I think we need clarity and we need certainty for investors and on the back of that, we need to make sure we have all of our ducks in a row," said Key.
The Maori Council has welcomed the delay in the sale of Mighty River Power. Deputy chairman Rahui Katene said the delay was a victory as it showed they were not going to be ignored by the Government.
"It's not a huge victory but it is a great victory in that they're deferring the sale," said Katene.
"We can sit down and go through the discussions in detail, we're not constrained to a short time period."
The Waitangi Tribunal interim report, issued last month, suggested a national hui should be held on water rights.
That idea has been rejected by the Prime Minister who says the Government will instead negotiate with affected iwi in the next five weeks.
Key is also refusing to say whether Maori should be given greater control of energy companies.
The Maori Council is not ruling court action if the Government ignores the recommendations of the Tribunal report.
"We still need to make sure that all of our options are sitting on the table. We can't turn out back on any of them just yet," said Katene.
The Government will push ahead with the sale of other SOEs Meridian and Genesis Energy toward the end of 2013.
Green co-leader Russel Norman said the delay in the sale of Mighty River Power was one of many problems the scheme has run into.
"Whether it's the Maori water rights issues, whether it's market issues or the people of NZ who oppose this programme," said Norman.
"The Government's asset sales programme has run into a series of problems and this is just the latest one."
Mana Party leader Hone Harawira said it was not up to Key to determine when and how discussions over Maori rights to water take place.
"I think he (Key) shouldn't be setting a time limit on Maori's desire to want to discuss this and he shouldn't be determining who he discusses this with."