14 January 2014

Last week’s news about “New York’s finest” is a colourful departure from the honest behaviour expected of public sector employees. The prosecution has begun of 106 sometime employees of the City of New York Police Department (NYPD) and the Fire Department of the City of New York (FDNY) for defrauding their disability insurance scheme. More prosecutions may follow.

Benefits of up to US $50,000 a year are being paid in response to claims based on an inability to work caused by post-traumatic stress disorder, anxiety and depression – many attributed to 9/11 events.  After a two year investigation, a  wide ranging scheme involving hundreds of claimants has been untangled.  Four “masterminds” apparently trained claimants how to qualify for these pensions by feigning symptoms of psychiatric illness. The estimated cost to date is $400 million.

An equally concerning aspect of this incident is that the frequency of disability claims on dubious grounds was well known in the NYPD. To date there has been no report of frequent – or indeed any – whistleblowing of possible fraud by former colleagues of claimants. The blue line seems to have held together.

The effect of traumatic experience on police is well reported – and in  New Zealand there was a Police Early Retirement Fund  to facilitate departures when officers lost the ability to meet performance standards. The scheme acquired a pejorative reputation because of a number of claims made on it, and was closed under a cloud of suspicion in 1991.

Honesty is essential for integrity. It is one of the trustworthiness standards in the Standards of Integrity and Conduct for the State Services.  The SSC guidance indicates that public trust in the State Services will be determined primarily by the degree to which New Zealanders believe that at all times agencies and their staff act with honesty. State servants are expected to respond to what they believe to be true, and to act always with a focus on accuracy and authenticity.

The State Services Commissioner explains that “…Honesty is frequently associated with professional courage. We must not act with guile for administrative convenience or to conform to political arrangements. We must not deceive or knowingly mislead. Being honest requires us to set out facts and relevant issues truthfully and to correct any errors as soon as possible. We must be careful about providing only some of the facts about an issue if we anticipate that we may encourage misunderstanding. Providing only half the facts may mean we are telling only half the truth. Honesty means that we are truthful and open…

This obligation is not only work-related. It arises at any time when the consequences of dishonest conduct may have an impact on public trust or on the confidence that Ministers, Parliament, or others in the State Services, can have in our organisation….”