4 January 2011

It was less than five years ago that New Zealand media unfavourably compared the business environment here with Ireland; the general sentiment being that our markets were more like a domestic moggy than that celtic tiger. How things changed. Ireland is now in an economic mess, and nothing is heard from those who advocated adopting the Irish model.

An interesting holiday read was Ship of Fools: How Stupidity and Corruption Sank the Celtic Tiger by Fintan O’Toole, who is an Irish Times columnist. He explores the economic bubble, and the way it burst.

The story is now well known – disregard for good fiscal policy, and through both incompetence and corruption, the capture of government by business interests. The boom, resulting from minimal controls on the Irish banking and financial sectors, and rash tax incentives for property developers, was both spectacular and short lived.

O’Toole explores widespread disregard for principles of good government – self interest seems to have overcome any sense of integrity and commitment to the well being of community. Ship of Fools is a case study on the destructive consequences of unmanaged conflicts of interest.

New Zealand Ministers are bound by the Cabinet Manual which is explicit about identifying and managing potential conflicts.  The Cabinet Manual also specifies that “all employees in the state sector must act with a spirit of service to the community and meet high standards of integrity and conduct in everything they do. In particular, employees must be fair, impartial, responsible, and trustworthy.”

Such prescriptions are not an assurance of good government. People in public office must be unwavering in respecting the democratic process and the rule of law. Integrity is a state of mind not a set of rules.