The creeping corruption of official New Zealand

I’m not sure how many readers get and read the Sunday Star-Times (SST) newspaper.  Some weeks I flick through and wonder why we still do.  But yesterday as I turned the pages I was glad I had, because it was as if one page after another shone a light on some aspect or other of the degraded state of New Zealand public life.   And it got me thinking not just about those specific stories, but about others that had been in the news over the previous week.

Starting with the relatively small stuff, there was an SST story about NZTA.   The first bit of the story was about how

The New Zealand Transport Agency allowed a senior staffer to bid for a multi-million dollar contract in a ridesharing service that came with a $475,000 subsidy from the Government agency.

Surely that should have been totally unacceptable?  But not, it appears, to NZTA.  Despite, as the article notes, guidance from the State Services Commission that

“in general, having a private business in the same area as a public servant’s official responsibilities would be highly problematic and is most likely to be unacceptable”.

NZTA’s blithe response was to state that “it managed the obvious conflict of interest”.

Now, as I understand it, it wasn’t NZTA itself awarding the contract and (as it happens) the senior NZTA employee didn’t win the contract.  But why was such conduct allowed in the first place?  If you work for a government agency, you simply don’t do stuff in your private life where there could be any reasonable suggestion of a conflict of interest.

This particular story was, we were told, one of seven cases of employee conflict of interest NZTA had to disclose.  The other specific case cited in the article –  around an NZTA regional director who is also chair of a Maori tribal authority “involved in a project currently under construction” by NZTA –  seems, if anything, worse.  The fact that the regional director had agreed not to be involved in any matters relating to the project, doesn’t change the fact that all her staff and colleagues know her, and presumably know of her outside interests.  It is (well, should be) staggering that these arrangements are smiled on by NZTA.  (And it should be a little surprising that the journalist writing up the story seems to have made no effort to get comment from the Minister of Transport, or from the Opposition spokesperson.)

Elsewhere in the media last week – I think mainly in the Herald – was the story of the Supreme Court judge who had been off on holiday with a senior lawyer in a case that was currently before the Supreme Court.   In various articles I saw, uneasy lawyers were falling over themselves not to impugn the “personal integrity” of the judge –  I guess the (now retired) judge has colleagues and these lawyers might have to appear before them –  but frankly this just should not be acceptable conduct.  Apparently the rules allow the other side to object to such cosy holiday arrangements (or other possible conflicts) –  which didn’t happen in this case –  but as the articles noted that is hardly a cost or risk-free option for the other side’s counsel, risking getting offside with the judge (for having disrupted his or her –  in this case – holiday plans, and perhaps being seen to impugn their integrity).   But the onus shouldn’t be on opposing counsel: the rules should be strict, and the conduct of the judges should be (if anything) stricter.  Personal integrity here should include a conscious recognition of the need for justice to be seen, by fair-minded observers, as utterly impartial.

There is talk in the articles about how hard it is for judges, of the “small and tight-knit” legal community, of lifelong friends, and so on and so forth.    Nothing in that should make it acceptable behaviour for judges to be holidaying with lawyers who appear before them (and especially not in current cases, and for higher court judges).  When you take on the office of judge –  perhaps especially in our final court of appeal –  you should accept –  and the system should demand –  a high degree of restraint, and of distance, that people in most other roles won’t face.

But, being New Zealand, it isn’t clear that anything is happening about situations like this  (there is a specific –  somewhat belated –  application for a recall of the judgment in question, but this is a wider issue).  I saw no questions of the Chief Justice demanding answers as to how this can be acceptable behaviour, and no questions of the Minister of Justice and/or Attorney-General.   And not a peep from the Opposition, of course.

A bit further on in yesterday’s SST was a column about the Gordon Jon Thompson situation.  This was the lobbyist, and friend of the Prime Minister’s, brought in by the Prime Minister to serve as her chief of staff for several months, with exposure to all Cabinet papers, and heavy involvement in the appointment of Labour ministerial staff, all the time fully intending to return to his lobbying business.  If I’ve read correctly the various stories, throughout his time in the PM’s office, he remained a director of his lobbying firm, and never disclosed who his clients were, rendering it hard to take seriously the Prime Minister’s claims that matters relating to his clients were never discussed between them.    And then this morning we read that there is more

“The Prime Minister’s office has said she ‘seeks out Mr Thompson as a sounding board from time to time.’ However, none of the Prime Minister’s interactions with Mr Thompson appear in her ministerial diary released on the Beehive website.

“Last year, the Government undertook to publicly release details of Ministers’ diaries consistent with its promise to be the most open and transparent administration in New Zealand’s history. The Prime Minister has released details of phone calls and meetings with a wide range of people. So, why is she keeping her communications with Mr Thompson a secret?

Again, lots of people seem to fall over themselves to not impugn the “personal integrity” of those involved.  But their personal integrity is in question, because senior people need to recognise, and live in a way that respects, that the absolute avoidance of any appearance of conflicts is almost as important as the absolute avoidance of the substance.  Confidence in our system depends on people have good grounds to believe that the system works fairly, impartially, and with rules and degrees of self-restraint that bend over backwards to avoid actual or perceived conflicts.      The question isn’t whether laws have been broken or not –  although it looks as though the laws should be tightened –  but a matter of what is an acceptably high standard of behaviour from those holding public office.     Even if everyone in this affair had the best of intentions (which we can’t simply grant) conduct in this case cannot possibly have reached that level, if we are at all serious about decent and demanding standards in public life.

Then, of course, there is the ongoing Makhlouf affair.  Really serious misjudgements by one of our most senior public servants were on full display during the “Budget leak” affair a couple of weeks ago.  Notionally, Makhlouf’s employer is conducting an inquiry into that behaviour, but (a) this is the same State Services Commission that was putting out coordinated statements with Makhlouf as part of the original problematic series of events, and (b) even as the inquiry is ongoing, the State Services Commissioner was giving a gushy farewell speech at the Beehive farewell party for Makhlouf, including stressing how collegial the group of public sector CEOs is.   Perhaps we’ll even see this week the State Services Commissioner’s report, but how can anyone have any confidence in the integrity of the process, let alone in the willingness of top officials to take any responsibility, or express contrition, when they get things wrong –  as Makhlouf demonstrably did?   The cosy arrogance of the whole affair was further compounded last week when Parliament’s Finance and Expenditure Committee held its hearings for Vote Finance.  The Minister of Finance turned up, but the Secretary to the Treasury simply absented himself.  He wasn’t sick, he wasn’t suspended while the SSC inquiry was ongoing, and he seems to have simply decided that serious scrutiny –  not from his chums at SSC but from Opposition MPs – whether about the systemic weaknesses that led to the problems in the first place, or about his own conduct, could be uncomfortable, and so stayed away, sending his underlings along to make excuses for him.   And, as we know, he leaves office later this week, flitting off to another job in another country.   Parliamentary scrutiny of public officials is supposed to be one of the features of our systems, but when it gets uncomfortable it clearly doesn’t matter to Makhlouf – nor, presumably, to Grant Robertson who might reasonably have insisted that Makhlouf turn up.

In a post last week on the ANZ/Hisco affair, I noted that –  whatever the prurient interest in a large private business’s issues with its now-departed CEO –  there should be greater focus on senior public officials who use the public purse (their time, paid for by the taxpayer) to advance personal causes, political or otherwise, for which they have no official mandate.   After all, while we can change banks, we are stuck with our central bank (our transport agency, our courts and so on).    As I noted

And when the Governor of the (monopoly) Reserve Bank never gives substantive speeches about things he is actually responsible for, plays fast and loose with the Official Information Act, claims he has no resources to properly oversee the bank capital system (internal models and all) that the Bank itself put in place, all while spending a million dollars on a Maori strategy (for a body with little or no public-facing role), devoting his time and professional energies to personal passions, be it climate change, infrastructure, or whatever, there is also nothing we can do about it.  The amounts involved –  money diverted from core functions (under budgetary pressure) to finance the Goveror’s personal causes and whims –  is probably already at least as much as the Hisco case over 10 years.  But we can’t change central banks, can’t dump our shares in the Reserve Bank.  Perhaps these issues (for some reason) excite fewer people, but when the abuses and slippages are by high government officials, they need to be taken much more seriously, precisely because exit isn’t (for us, citizens) an options.  The small(ish) stuff needs to be sweated.

Some readers may have thought I was slightly over-egging the point, but shortly after releasing that post, I had an email from a reader with yet another example of Orr abusing his office.  Next month, Orr is giving a speech to the financial industry group FINSIA (members can get continuing professional development credits for turning up to hear him) and my reader sent along the promotional email.  Orr’s speech is billed as “The Future of the Reserve Bank: The View from Tane Mahuta” (which itself was a bit puzzling because in responding to critics of his tree god nonsense Orr claimed that “we don’t see ourselves as a tree god”, and yet that seems to be exactly how his speech is billed.)    It is possible there could be some substantively interesting material –  after all, the next stage of the review of the Reserve Bank is supposed to see a discussion document out in the next couple of weeks.  And there is some mention of that review in the email FINSIA sent out hawking the Governor’s address.    But just as much space is given to this

The Bank is focusing on strategies that contribute to climate change sustainability and a commitment to a more culturally inclusive central bank with a higher degree of awareness of Te Ao Māori.

You can be sure that Bank’s communications people will have approved how the Governor’s speaking engagement is described in the FINSIA advert.

As I have noted many times before, the Bank has no mandate at all for the Governor’s climate change focus.  As he very well knows, it is largely irrelevant to monetary policy, and of very little relevance around financial stability in New Zealand.  It is a personal crusade –  using a public platform to advance his personal causes.  Much the same can be said for his Maori strategy: it bears no relation to the things Parliament asked him to do, and neither monetary policy nor financial regulatory policy bear down in systematically different ways on Maori than on non-Maori (any more than on red heads as distinct from others,  Christians as distinct from atheists, Labour voters as distinct from National voters, and so on).  It is simply a misuse of office, and of the scarce resources the taxpayer has put at the Governor’s disposal (recall, that this is the Governor who claims he is under-resourced to do basic elements of his financial regulatory role).    Perhaps it all plays well with members of the Labour and Greens caucuses, but that simply isn’t his job –  and it remains possible he could find himself working with a National-led government before his term is out.   How could they, or we, have any confidence in the impartiality of the Governor, or that he is using his office –  and resources –  strictly for the things Parliament mandated the Bank to do.

(And while people on the right often want to suggest that all the bad stuff emanates from the Minister of Finance –  same tendency evident in reverse when National-led governments are in offce – I took the opportunity to look up the Minister of Finance’s latest letter of expectation to the Governor.  These letters can’t add to or subtract from statutory obligations, but can be interesting/important nonetheless.    But, as it happens, none of the Governor’s personal obsessions  – climate change, the tree god, the “Maori strategy” –  were mentioned at all,  It was nice to have that level of confirmation that the abuse of office is all the Governor’s own doing.)

I could go on as regards the Bank. I’m involved at present in the consequences of highly problematic (at best) choices made by the Bank, dating back to when Orr was Deputy Governor, and for which neither he nor his current deputy –  responsible for the Bank’s work on “culture and conduct” in the financial system –  show any real sign of taking responsibility for, or fixing.  Come to think of it, the Financial Markets Authority –  financial regulator –  displays little energy either.  But that is enough for now.

These are just a handful of the sorts of episodes, great and small, that go on in New Zealand –  a country that likes to claim high standards of governance and accountability in public life.  They take different forms.  Already, the Shane Jones/Semenoff affair recedes into memory.  Police simply flout the law.  Or what of a statistics agency run so poorly that even the Census was botched, and yet no one loses their job?  And so we could go on. If we don’t start sweating the “small stuff” again, or simply get used to a ‘near enough is good enough”, or “never mind, decent individuals” standard, we’ll lose any traction in clinging onto the sort of standards a decent and open society should be insisting on from those who hold public office.  Good –  honest, open, rigorous, accountable – government is a rare and valuable thing.  Degraded government –  and we risk slipping down exactly that path  –  is a serious threat to the sort of standards New Zealanders once held dear.

Then again, what to expect in a country where the major Opposition party has a former PRC military intelligence official, close to the PRC embassy, (formerly?) a CCP member, sitting in its caucus, while its president sings the praises of Xi Jinping?  And the governing parties seem quite unbothered by any of that, having sold any soul they once had when it comes to anything to do with the regime in Beijing (in fact, this very week, the deputy leader of the Labour Party is in China aiming “to deepen…our relationship with China”.)  Xinjiang?  Hong Kong extradition laws?  Forced organ extractions?   South China Sea?  Systematic persecution of religious believers of all stripes?  Systematic repression of any dissenters?  Abduction of Canadian citizens?  Never mind, nothing to do with us, seems to be the combined National and Labour line.

Just another example of a corrupted and corroding system, where the only “value” left seems to be some mix of what can be got away with, and what generates a few more dollars or donations.  And barely anything left at all about what is right and decent.  Or about the notion that the only real test of someone’s values is what they will pay a price for.

(And, after all that, I never even got to the SST stories on the immigration system. Perhaps tomorrow.)

 

 

12 thoughts on “The creeping corruption of official New Zealand

  1. Nice commentary Michael.

    It is indeed a bipartisan effort. I found it highly unusual for the Minister of Finance in the previous Government to have his (utterly unqualified) brother advising the Reserve Bank.

    Like

  2. Reblogged this on The Inquiring Mind and commented:
    An excellent post,totally on point, from Michael Reddell. But where are our media on this. Writing fluff and puff on Ardern or attacking John Key. Corruption,especially political corruption is ignored

    Liked by 1 person

  3. Personnally I’m not in sympathy with this article: https://www.newsroom.co.nz/2019/06/24/650592/child-uplifts-stop-trying-to-plaster-over-the-cracks but the author is more knowledgeable than I and also likely to influence literally life and death decisions about taking a child into care.
    There are three enquiries into ‘child upifts’ but the author is assuming bias before they start and she gives her reasons.
    “”The Hawkes Bay baby’s whānau has referred to the internal inquiry into the case as ‘Dracula in charge of the blood bank’. This term would equally fit the Children’s Commissioner and the Ombudsman – both of whom say they are now investigating.
    As Children’s Commissioner, Judge Andrew Becroft’s role includes to ‘monitor the services provided under the Children, Young Persons and their Families Act’. The public should be asking – so why have you not been monitoring Oranga Tamariki’s practice of taking ex-parte orders to snatch newborn babies from their mothers?
    And Newsroom’s story telling us that in his capacity as Chief Ombudsman, Judge Peter Boshier, is launching a wide-ranging investigation into Oranga Tamariki. His announcement can only be described as hypocritical in light of his former position. Before taking up his current role in 2015 Judge Boshier was Principal Family Court Judge for eight years. During that time, he was responsible for the very system that must have signed off hundreds of orders for the placing of children…””
    Taking children from their parent(s) is always going to be a very contenious issue. So any public reports need to be seen to be impartial.

    As you say: “” Confidence in our system depends on people having good grounds to believe that the system works fairly, impartially, and with rules and degrees of self-restraint that bend over backwards to avoid actual or perceived conflicts. “”

    Like

    • Interesting question. At a micro level, what can individuals do? Make a fuss. Write to your MP or the PM, use social media, write letters to the editor. Demand that standards are upheld. In the short-term it won’t make any difference, but if enough people showed that they took the issues seriously it could over time.

      At a macro level, my own view is that there is a crying need for some new force in NZ politics that would, so to speak, “drain the swamp”. Perhaps there are decent concerned individuals in the two main parties, but they are ineffectual and in the thrall of the respective parties’ hierarchies, which have led us to this position. It is hard to see where this new force might come from: needs some combination of integrity, passion, money, ideas, rhetorical force. I’m not optimistic – including because I don’t believe there is yet much sign the public cares much, and because to the extent there is a market there is a risk of that space being filled by frauds and phonies.

      Liked by 1 person

      • I certainly agree Michael we need to “drain the swamp”, but I see no hope with the current major parties who are heavily invested in the status quo (and who it appears have no qualms about accepting money from the Chinese Communist Party through its local front organizations) . It will take one or more of the minor parties to come through and shake things up. I am heartened in that regard by the defense of free speech which is fundamental to good governance now being mounted by Act and the New Conservatives.

        Like

      • ACT and the NCs both seem good on free speech, but the former has been all-in on the PRC (or used to be, and i’ve not heard anything less bad recently). But both brands are pretty tarnished, and neither really seems to have a compelling alternative vision.

        Like

  4. I think we have had a big change in culture whereby lying is acceptable if it is in a good cause as we (attempt to) move to a post ethnic society. It is definitely us and them

    “Whatever happened to the Christchurch central Library?”

    We are a bicultural and multicultural library. We represent all our citizens

    On top of “us” and “them” there is needing to show net benefit (or the deplorables and goodies might have to swap jerseys)..

    Like

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Google photo

You are commenting using your Google account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s