23 February 2015

When last week the Labour Party leader stirred what seems a minor storm in the political tea cup, a TV journalist predicted an end to the media honeymoon that followed Andrew Little’s selection three months ago.  The excitement followed a report that he had failed to pay for professional services despite several approaches to his staff.  What didn’t excite interest was that the provider was apparently an employee of a TV company and under standard obligations of trust and confidence  could only have been selling his services to the Labour Party if he had the imprimatur of his employer or he was in breach of employment duties.

A much more concerning story would be if providing services for the Labour Leader was approved secondary employment for TV company staff.  Last year an employee for Maori Television found that political interests are not acceptable for high profile staff in an agency funded from public money (although Maori TV is a statutory body – an agency associated with a portfolio –and has stakeholder Ministers,  its staff are not State servants subject to the Standards of integrity and Conduct for the State Services).

Last week’s event that should have ruffled many more feathers among those concerned about ethical standards in politics is the report of the appointment of the former Minister of Health for six years (and Minister of State Services for half that time) who five months after leaving office was appointed as a director of nib – a large Australian medical insurance provider and second largest in New Zealand.

New Zealand governments have shown no interest in regulating revolving doors – despite  requirements that the OECD has of its Members, and the constraints legislated by most comparable jurisdictions.  OECD  guidelines on managing conflicts of interest have a particular focus on the movement of regulators from the public sector to the commercial world which they have regulated – influenced by a United States Revolving Door Working Group  report  “A Matter of Trust – How the Revolving Door Undermines Public Confidence in Government – And what to do about it”.  Ministers moving into industries where their portfolio experience has direct relevance or into lobbying where familiarity with systems and officials provides advantage , are in all jurisdictions,  an insidious  corrosion of trustworthy government.

The 10 Principles for Lobbying and Integrity adopted by the OECD in 2010 included a provision “…..Countries should consider establishing restrictions for public officials leaving office in the following situations: to prevent conflict of interest when seeking a new position, to inhibit the misuse of ‘confidential information’, and to avoid post-public service ‘switching sides’ in specific processes in which the former officials were substantially involved. It may be necessary to impose a ‘cooling-off’ period that temporarily restricts former public officials from lobbying their past organisations….”

Although many of the Principles are reflected in New Zealand’s public  integrity framework, Ministers seem very reluctant to limit their post-political career opportunities.

When in 2011, a senior Minister announced an intention of leaving politics to seek opportunities in business, he stood down from the role of Minister of State Owned Enterprises – although retaining the Justice and Commerce portfolios – only to walk through the revolving door into a banking sector role related to those portfolios, in a time showing scant regard for the 18 February 2010 resolution of the OECD that its Members  take into account the 10 Principles in their rules, practices and policies, and that non Members adhere to those Principles.

http://business.scoop.co.nz/2015/02/13/nib-appoints-tony-ryall-to-nz-board/

www.oecd.org/gov/ethics/Lobbying-Brochure.pdf

www.opengovguide.com/standards-and-guidance/revolving-doors-accountability-and-transparency-emerging-regulatory-concerns-and-policy-solutions-in-the-financial-crisis/

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