thechristchurchfiasco

"Shifting the Balance of Power in the insurance industry – back to the policyholders! "

Different approaches to comparable problems- guest post by Herman Meijburg

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After 584 earthquakes and with still some 1100 predicted quakes in the near future, the first natural gas production unit in Groningen, The Netherlands, was finally shut down on April 14th. This event marked a struggle spanning some two decades, SAMSUNG CAMERA PICTURESduring which the population of the province of Groningen tried to prove to the Dutch government that the damage to their properties was directly related to the exploration and production of this valuable resource underneath the region where they happen to have chosen to live. The first quake was registered in 1993, some 30 years after the initial commencement of production of natural gas in 1963. Today (2015), as a consequence of the earthquakes 80 per cent of the properties in the town of Loppersum are severely damaged – 40 of those are no longer habitable and will need to be demolished. In the entire region of Loppersum some 170,000 properties are in need of urgent repair and/or require earthquake strengthening. Home-owners are trying to sell their properties but buyers understandably stay away and as a consequence the homeowners are forced to remain where they are. Meanwhile their homes rapidly decrease in value and sustain more damage every year. In 2014 compensation for the earthquake damage and the loss of value in properties was estimated at 1.2 billion euro.

It took a court directive for the Dutch government to take action. The Dutch government has until the court ruling always ignored the evidence of a clear connection between the extraction of natural gas from the region, the increasing number of earthquakes and that damage to buildings in this area was highly probable. Of course there is much at stake here. Every year some 1.25 trillion cubic feet of natural gas is produced in the Groningen gas field and sold at market prices. The annual proceeds enable the government to pay for the social premiums, to fund the national infrastructure of roads, waterways, the railroad network, etc. This additional income helps the government to balance its books and has provided the taxpayer over the years with some 211 billion euro in savings on taxes and social premiums.

The exploration, development and production of the gas field were granted to a joint venture between Royal Dutch Shell and Exxon. The Nederlandse Aardolie Maatschappij (the Dutch Oil Company) is their holding company and responsible for the oversight. Contractual obligations put the government on the back foot. This led to many decades of ignoring and denying the rising problem for citizens living in the area. While at the same time the government defended the Nederlandse Aardolie Maatschappij by saying that they had everything under control and people need not worry.

The recent intervention of the court was not only based on numerous complaints by the affected population but also on the basis of a report by an Independent Commission of Enquiry. In that report the link between the gas production and the damage to the properties was acknowledged beyond reasonable doubt. Over and above the material damage to people’s assets, it was also brought to the attention of the government that due to the ongoing aftershocks people no longer feel safe in their homes, resulting in anxiety and mental stress. The court ruled that for these reasons the Dutch government carried the responsibility to act on behalf of the well-being of those affected citizens in order to prevent further harm. The Raad van State (the highest senior advisory body in the Netherlands in legislation matters) urged the government to shift the burden of proof from those affected people, to the Nederlandse Aardolie Maatschappij. That company now bears the responsibility of proving that the damage caused to claimants’ assets is caused by the extraction and production of natural gas.

This ruling is ground breaking for a number of reasons.

First of all it broke the cycle of deny, delay, and defend which had been on-going for decades. Secondly, the Court acknowledged the claims of the affected population as being legitimate. The court prioritized the interests of the people over and above the interests of the national government and the corporates involved. Fourthly, the government was called to order, to take its responsibility to prevent any further foreseeable harm. Fifthly, the burden of proof that damage to homes was/is caused by the earthquakes as a direct result of the production of gas has moved from the claimants back to the corporate involved, the Nederlandse Aardolie Maatschappij.

What I learn from this is that not only the Government carries a responsibility for protecting it citizens and taking action against the corporate but the burden of proof in relation to damaged property was no longer the responsibility of the homeowner but has been firmly placed at the feet of the corporate involved. Is it not about time that this happens in New Zealand too?!

Resources

http://en.wikipedia.org/wiki/Groningen_gas_field

van der Voort, N. and Vanclay, F. 2015, “Social impacts of earthquakes caused by gas extraction in the Province of Groningen, The Netherlands”, Environmental Impact Assessment Review 50, 1-15. http://dx.doi.org/10.1016/j.eiar.2014.08.008

http://www.nrc.nl/nieuws/2015/04/14/raad-van-state-zet-voorlopig-streep-door-gaswinning-loppersum/

Author: Sarah Miles

Trained as a lawyer, psychotherapist and mediator. My goal is to make my voice heard for the causes in which I believe so as to improve and contribute to a more sustainable and equitable society. I believe in the enormous power of the human spirit and the power within each of us to effect major change. "The only triumph over evil is for good men [and women] to do nothing". https://thechristchurchfiasco.wordpress.com/

3 thoughts on “Different approaches to comparable problems- guest post by Herman Meijburg

  1. Herman Meijberg’s article raises some interesting points
    NZ legislation imposes a number of obligations on Government, that in the Health Act 1956 being the one I am most familiar with, namely:
    s3A Function of Ministry (of Health) in relation to public health
    Without limiting any other enactment or rule of law, and without limiting any other functions of the Ministry or of any other person or body, the Ministry shall have the function of improving, promoting, and protecting public health.

    I am one of many Christchurch earthquake victims still homeless more than 4 years after the earthquakes, and prevented from moving forward because I WAS FULLY INSURED. Being uninsured would have allowed me to progress the currently horrendous situation, but because I was insured I can do nothing until my land loss and damage issues are resolved. EQC still has not completed proper assessments of my land loss and damage and still has not paid me anything in compensation. My health and that of many other Christchurch claimants is not being protected, and the Government continues to ignore its statutory responsibilities

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  2. Near the end of all this, the government will step in behaving that it never knew, and assisting the last few stalwarts in a move which exalts them through “their” media to hero status. I never imagined that Little ole NZ was so corrupt but I have witnessed it first hand The relationship between this government and the Insurance industry and their serpent like adjustments, from the relaxation of building tolerances in EQC to the over $40 million media works donation encouraging the death of investigative journalism is generally ignored by a “dumbed down populace” and THERE lies the root of the problem. Apathy.

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    • Thank you for your comment Dave. Interesting enough the Dutch Oil and Gas Company (NAM) has recently publically apologized to the home owners for ignoring the validity of their concerns.This move came as a bit of a surprise and people are uncertain what to make of it. Because it does not mean that the problem will go away any time soon nor that those affected by the earthquakes will be properly compensated for their loss. Nevertheless it has created an opening; after so many years of denial the underlying issues are finally acknowledged by the NAM as legitimate. One could argue that the company’s apology was not genuine and only done on basis of a “hint” from the Dutch government. Whatever the motive to do so, it shows that, at the end, public protest can be effective and bring about a change of direction. At the end the persistence of the affected residents won the day, it took years and it wasn’t easy. Herman Meijburg

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