The Government will not push for the full removal of the wreck of the container ship Rena from Astrolabe Reef, off the coast of Tauranga, because of the health and safety risk and substantial cost.
In a submission that partially opposed a resource consent application on behalf of the ship's owners, the Crown said only the part of the wreck in shallow water should be cleared away.
Two Motiti Island groups want the wreck of the vessel to be removed and have taken their case to the Waitangi Tribunal.
A community trust formed by the owners of the ship has applied to Bay of Plenty Regional Council for resource consent to leave behind what's left of the container ship, which ran aground on the reef in October 2011.
The Crown's submission opposed the application to leave the bow section and debris of the Rena where it is, on the top surface of the reef, in water to a depth of 30 metres.
Attorney-General Chris Finlayson said the Crown believed the bow section and debris in waters down to 30 metres should be removed as thoroughly as possible.
But the stern section, which was sitting at about 70 metres down, should be able to remain.
"Taking into account all the various matters including particularly health and safety concerns which are a major consideration for the Crown following the Pike River disaster, we don't think that that aspect of the wreck should be removed," he told reporters on Friday.
Buddy Mikaere from Motiti Island group Ngai Te Hapu said the Government submission offered only a cosmetic clean up.
"The ship has used anti-foul marine paints proven to be (a) toxin, and there's an admission that those paints will continue to leach away over time. Potentially they're leaving behind an environmental time bomb."
Tauranga Mayor Stuart Crosby said challenging the application to leave the wreck on the reef would be difficult.
"The Motiti Island people are quite correct. But when you read the application, it is really based on safety and science and there is a lot of science behind their application, so to challenge that would be quite a difficult task."
Tauranga business owner and dive club member Russ Hawkins said he fully supported the decision to not push for the full removal. He said removing the whole wreck would be dangerous and scientific reports from the Rena's owners showed the wreck posed little danger to the environment.
The Crown's submission also proposed enhanced monitoring and consent conditions for those parts of the wreck site below the 30 metre cut-off point.
"Our submission includes recommendations to improve the monitoring and consent conditions in order to ensure the longterm effects of what remains of the wreck are appropriately managed, " Mr Finlayson said.
Government could forfeit $10.4m payout
Prime Minister John Key said the Government could be forfeiting a $10.4 million payment by the owners of the Rena for not supporting their resource consent application to leave the wreck on the reef.
The Crown had signed a deal with Daina Shipping for the money if their consent application was granted but Mr Key said the Government's announcement on Friday may have put an end to that payment.
"Our reading of our submission would be, that if it was accepted, that the $10 million would be forfeited, we wouldn't get that," he said. "We're not arguing to support that."
Mr Key said the ship's owners had already spent at least $350 million on the clean-up.
Labour and the Greens respond
The Labour Party welcomed what it said was an about-face by the Government in wanting at least some of the Rena wreckage removed.
"What we've been told is that more of the wreckage could be taken out, so we would like to see more but it certainly is an improvement on the Government's previous position," Labour's environment spokesperson Moana Mackey said.
The Green Party's oceans spokesperson Gareth Hughes said the Greens were sympathetic to groups such as iwi that want to see all the debris removed but it was difficult.
Mr Hughes said there was not only more of a risk to salvors at deeper levels but explosives used in wreckage removal could damage the reef.
Submissions on the consent application closed at 5pm on Friday.