4 May 2012
Does the community expect higher ethical standards from people who work for government than its members set for themselves?
The Cabinet Manual requires all employees in the State sector to 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…”
And the same high standards are required of members appointed to Crown entities. They too have a statutory responsibility to perform functions with a spirit of service. Board members who comprise part of their agency, are bound by the code of conduct for the State Services, applied by statute to “…an agency (including its employees)…” which also requires all who work for it to be fair, impartial, responsible and trustworthy.
So if it is lawful, is it ethical?
Last night there was discussion on the Guardian Public Network about fraud in the UK. Public sector fraud is extensive. The network encouraged commentators to share ideas on improving structures and processes to reduce payroll and procurement fraud – conduct which of course should be alien to public spirited and ethically minded officials.
Ironically, although the British National Fraud Authority has recently reported a reduction in tax fraud, a leaked the Treasury memo published yesterday – on World Press Freedom Day – identified more than 2000 contractors in public sector agencies who have minimised their tax liability by their remuneration going to private companies rather than being paid as personal income. The Guardian reports that Ministers were surprised, which seems rather unworldly of them, as earlier this year there were disclosures that large numbers of senior civil servants had similar arrangements. The Treasury has identified more than 1600 contractors who have been working with agencies for longer than six months, but not paid through the payroll.
The remedy proposed by the UK Government is that individuals on contracts of longer than six months, paying more than NZ$ 450 per day, who don’t provide an assurance about tax and national insurance payments, will have their contracts terminated. A similar measure in New Zealand would not be welcomed by many who contract their services to agencies , or the appointees to boards who seek to ways around guidance on the Fees and Travelling Allowances Act and related tax obligations.
Should public spiritedness require something better?