Yes, Orr/Quigley/Willis again. For everyone’s sake now – well, perhaps except her own – one can only wish that the Minister of Finance would finally decide, more than six months on, to make a full and complete disclosure of what actually went on around the exit of Orr and the aftermath.

Instead, the snippet by painful snippet process continues. Since my post yesterday we’ve learned some more things:

First, questioned by Barbara Edmonds in the House yesterday, the Minister finally gave the gist of texts between her and Iain Rennie on 27 Feb re the commencement by the Bank’s Board of an “employment process”.   She and Treasury have withheld these texts for many months, long after she herself was the first to formally disclose (to FEC on 18 June) that there had indeed been an “employment process” prior to Orr’s departure.   That in turn lead her to realise – what she’d have known if only she were an assiduous reader of this blog! –  that in fact on 18 June she had also told FEC, three times with Rennie sitting next to her, that she’d first heard from him about the “employment process” on 24 February.   Last night just before the House rose she made a personal statement correcting this point.   No doubt it was an honest, if careless, mistake in June, although it doesn’t reflect very well that there was no earlier correction (when Rennie must have known, or suspected and should have quickly checked afterward, that his minister has mis-spoken).

Second, and much more importantly, just prior to 2 this afternoon Treasury finally released the set of texts in full. There are a couple about the funding agreement stance from 14 Feb, which are useful but don’t materially add to the information we already have (although do make clear that Rennie had only spoken to Quigley about the funding agreement bid on the morning of the special 14 Feb board meeting).  There is a mysterious one from Willis to Rennie on 17 Feb “Are you coming to the 230”, which has no obvious significance but Treasury must think it is somehow in scope.   And then there are the crucial 27 Feb texts.

The first of those adds nothing new, but the second does (going beyond what Willis told the House yesterday).    Note that fourth sentence: “Neil’s current thinking is that you could receive recommendation later next week unless decision is taken to go down voluntary exit route”.   In context –  and given the range of the Minister’s power –  this could only be a possible recommendation to dismiss.    So not only did the Board envisage their process culminating in a dismissal recommendation (NB an interesting pre-judgement before hearing Orr’s response), but the Minister was fully informed of that (and actually tossed in the observation that the board would need good legal advice, apparently approving of the lawyer Rennie advised her the board was using.  (Incidentally, she would also have needed good legal advice had it come to a recommendation to dismiss, given that any decision could have been challenged in the courts).   This completely undercuts the line Willis herself has run for months about how it was all nothing to do with her because it was an “employment process” when, as I’ve stressed and the Board, she, and the Treasury clearly knew, she was the one with the (hiring and) firing powers, and only her.

Text messages between Nicola Willis and Iain Rennie Feb 2025 re Orr released by Tsy 10 Sept .

The third development was a question to Willis from Edmonds in the House this afternoon.   She asked whether the Minister considered that Quigley’s characterisation of the exit from 5 March (and beyond) as “a personal decision” was misleading.    The Minister said that she had relied on Quigley’s judgement that that was all that he could say.     Edmonds could have strengthened the question, because Quigley also said on the day that “the Governor had got inflation into the target range and felt it was time to go” and denied that there were any conduct, policy, or performance disputes at the heart of the exit.    The Minister is just making up stuff if she believes that any of those lines were really satisfactory, unless “satisfactory” involved keeping the substantive truth from the public.   We still do not know –  and MoF claims not to either –  what NDA provisions there actually were, and nor do we know why the Minister (operating in the public interest supposedly) did not insist on (a) finding out in advance, and b) tightly constraining them so that the public was not misled.

Edmonds moved on to ask why the Minister also didn’t correct the record on/after 11 June (the Bank’s deeply misleading selective release and statement, which tried actively to avoid suggesting there had been any employment issues –  even though it was implicit in the existence of an exit agreement).  The Minister responded that she had not been aware of the Board’s specific concerns, or of Orr’s responses, or of the terms of the exit, she did not want to expose taxpayers to legal risk, and (supposedly highmindedly) did not “want to politicise a sensitive employment process”).  None of this really stacks up.  As it is, on 18 June, at FEC (but barely if at all reported at the time –  I hadn’t noticed it) she noted, what Quigley had sought to obscure, that there had in fact been an “employment process”, and of all the answers she didn’t have she could –  and probably should –  have insisted on them.   She was aware the Board was driving the Governor out but had no idea what the concerns were?  Yeah right.   And, of course, decisions around funding, and decisions to fire the Governor were –  by Parliament’s design – ones made by politicians.   Willis concluded that she had relied on Quigley and he should have done better.  Well, of course, but he was her man, and she covered for his approach for months, deceiving the public in the process.

On the final question, Edmonds asked if (rhetorically no doubt) if Willis really believed New Zealanders could trust her when she had withheld information, had known she might receive a recommendation to dismiss etc and (with a final flourish) when it fact it was Willis who had driven Orr out.    Willis attempted (rather laughably) the high road, suggesting that Edmonds was free to be the great defender if Orr if she wished, but as for her (Willis) she wouldn’t deign to “politicise” Orr’s exit.

And those were the new developments.

But there are so many questions still outstanding.  For the Board, at what point did they engage external counsel to advise on a process that (it is finally clear) they envisaged leading to an unprecedented recommendation to dismiss the central bank Governor?  And was this prompted mainly by Orr’s behaviour at the 20th and 24th meetings or had it been brewing even before that?   Also for the Board, given that clear direction, how can any of them with any integrity remain in office having been collectively responsible for the 11 June release, which was now even more clearly deliberately deceptive (under a guise of pseudo-transparency).   

As for the Minister (and Treasury) it remains inconceivable that we have had the whole story.  You, as senior minister, don’t just get a text out of the blue suggesting the part-time (mostly Labour appointed) board might recommend firing the Governor without wanting to know more, unless of course you already knew more.  It is beyond belief that there were no discussions after Orr’s walkout from the 24 Feb meeting, and not very likely that –  given that Rennie was being used as the comms intermediary (why?) – that no one at Treasury was looking into legal processes, grounds etc.

And, of course, why did she take no steps to ensure that a reasonably honest (not necessarily full or complete) statement was given to New Zealanders on a) 5 March, b) 11 June or c) at any other time up to and including the Ombudsman determination a couple of weeks ago?  Whose interests was she serving then?  Was her stance more about distancing herself from a process than legitimate legal/privacy issues for Orr?

Someone who doesn’t follow these things much commented to me recently “how can anyone now trust anything the Reserve Bank says?”   A good question, but as information continues to seep out from Willis, much the same might, unfortunately, be asked about her.   I remain convinced the ousting Orr was well-warranted and welcome, to her credit given the opening Orr’s behaviour created.  But not the cover-up, the active misleading, and the obstruction.  Or the lack of full disclosure to this day.