The Crown has told the High Court that any sale of state assets would have zero effect on Maori water claims.
The Maori Council is challenging government plans to partially privatise state-owned assets, such as power companies running hydro dams, before settling the question of Maori water rights.
The Government intends to partially privatise Mighty River Power between March and June 2013, followed by Genesis Energy and Meridian Energy.
The Crown's lawyer, David Goddard, QC, told the court in Wellington on Tuesday that government ministers are simply carrying out Parliament's intent by selling the assets, and that to intervene would be unwarranted.
Mr Goddard said a change in ownership for the assets would not have any effect on Maori water claims and is therefore irrelevant.
Maori groups have argued that the partial privatisation is in breach of Treaty of Waitangi principles.
Maori Council view
On Tuesday morning, Maori Council lawyer Felix Geiringer told the court the council wanted hapu and iwi to have as much ownership of water as possible without compromising other uses of rivers, such as the Waikato.
Mr Geiringer said there are some Maori who would like to take a pickaxe to every dam on the Waikato, but the council accepts there are other users, so the aim is to get as close as possible to proprietary rights as they existed in 1840.
He told the court the starting point was exclusive ownership by Maori, but they accept that exclusivity is being compromised.
"There is a Maori individual out there somewhere who would love to take a pickaxe to each and every one of those dams. That's not the New Zealand Maori Council's position.
"We're not saying that because of this exclusive possession of the water resource a hapu who owns that river can say this dam has got to come down - it's unrealistic, it's not going to happen."
Mr Geiringer said giving Maori enhanced voting rights over the partially privatised companies - the so-called 'Shares Plus' concept - would help overcome this difficulty, although it was an imperfect way of dealing with loss of mana over rivers.
The proposal, put forward by the Waitangi Tribunal, has been condemned by the Government.
