Tarred with the same brush?

10 October 2011

The storm in a champagne flute at the Serious Fraud Office, concern about inappropriate acceptance of gifts and hospitality at the Treasury, the proposal to legislate to limit parliamentarians’  travel and expenses entitlements to more publicly acceptable levels, and the allegation that New Zealand is becoming a haven for tax evaders, suggests that the spirit of service may not be as well imbued in the New Zealand State sector as generally thought.

Whether these issues will have influenced the perception of those who shape the Transparency International Corruption Perceptions Index will be known soon enough.  The CPI is published later this year.  The New Zealand position in equal first place  may be challenged.

The belief that there has always been a stronger commitment to ethical behaviour in government in New Zealand than in Australia can perhaps find strength in the proceedings underway in New South Wales, where evidence is being heard by their anti corruption commission into widespread payments being made by suppliers, to officials in numerous local authorities.

www.smh.com.au/nsw/council-workers-admit-receiving-vouchers-gifts-20111010-1lgxt.html

www.nbr.co.nz/article/nbr-editorial-champagne-charlie-must-go-102035

www.treasury.govt.nz/downloads/pdfs/deloitte-gift-oct11.pdf

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October 10, 2011

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Those who command must first learn to obey?

8 October 2011

The only surprising thing about media statements yesterday by State Services Commissioner and the Treasury, is the time they have taken.  The Commissioner criticised integrity attitudes in some agencies, and the Treasury, in confessional mode, has committed to abiding by (some) standards that have always been expected of people working in New Zealand’s State sector. Encouraging, but sad that staff in an agency with leadership responsibilities could have considered that in some way they are exempt from expectations long specified by Auditors General, State Services Commissioners, and the Cabinet Manual.

The Auditor General is very specific about declining gifts and benefits valued in excess of $20. And networking is not a justification for ignoring the Commissioner’s  guidance about his code,  that “receiving hospitality is usually inappropriate if it extends beyond courtesy.”

The Deloitte involvement in Treasury’s handling of ethics issues could have been avoided.  Following the 2010 State Services integrity survey, the Commissioner recommended actions to be followed by all agencies. The Treasury experience shows poor regard for those recommendations.  Having now paid for the Deloitte advice, integrity may be better valued.

A comparison with United States Federal Government obligations is interesting.  Hospitality is closely prescribed. Benefits must be valued at less than $20, with tight specification of whether that includes coffee, tax, tips etc.  But the provision is under review.  The Office of Government Ethics proposes to eliminate this access opportunity for lobbyists. The Washington Post reported that the proposals have been attacked by lobbyists. This seems to support the logic that profit-motivated business would not spend on officials unless there was  a commercial advantage. The implication is that officials accepting hospitality are disingenuous or disturbingly naive.

As the State Services Commissioner’s guidance notes, “in all matters of integrity, exercising judgement is essential.”

ssc.govt.nz/gifts-hospitality-media-7oct11

http://treasury.govt.nz/publications/media-speeches/media/07oct11

http://oge.gov/Topics/Gifts-and-Payments/Invitations-from-Outside-Sources/

www.washingtonpost.com/politics/limits-tighten-for-lobbyist-gift-giving/2011/09/28/gIQAh6RT5K_story.html

http://www.ssc.govt.nz/code-resources-organisations

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October 8, 2011

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New Zealand becoming another Pacific tax haven

7 October 2011

The 2011 Financial Secrecy Index published this week reports on the 73 “worst” jurisdictions that tolerate billions of dollars being banked offshore, losing about $250 billion annually in tax revenue for the source governments. New Zealand almost made this list of corrupted states that Nicholas Shaxson criticises for institutionalising tax evasion. Earlier this year, he predicted that before long, it would be counted among the rogues. This week’s report comments that “in subsequent FSIs we will include more jurisdictions needing serious scrutiny, such as New Zealand.”

Switzerland, the “grandfather of the world’s tax havens,” tops the index, although there has been minor erosion recently of its long established bank secrecy and willingness to receive unusually large cash transfers from questionable sources. Its neutrality and safe haven status will not be readily surrendered.  Other countries provide greater secrecy than Switzerland but rank lower because the smaller size of their banking sectors. Conversely, large banking countries like Germany and Japan are high on the list although less secretive.. The others making up the worst five tax havens, are the Cayman Islands, Luxembourg, Hong Kong and United States.

The growing concern about tax havens is not just the forgone revenues. “Secrecy distorts trade and investment flows, and creates a criminogenic environment for a litany of evils that hurt the citizens of rich and poor countries alike: fraud, evasion and avoidance of financial regulations, insider dealing, embezzlement, wholesale bribery, non-payment of alimony, money laundering, tax evasion and much more besides.”

New Zealand just missed inclusion this year, but Samoa, Nauru, Cook Islands, Vanuatu are on the index..  A concern must be the number of small island states that see tax haven status as an advantage, despite the accompanying “litany of evils”.

www.financialsecrecyindex.com/

integritytalkingpoints.com/2011/04/15/new-zealand-playing-offside/

http://treasureislands.org/

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October 8, 2011

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Getting what you ask for

6 October 2011

By international standards, New Zealand official information is readily available.  Despite repeated criticism by New Zealand media about the reluctance of agencies to respond fully to information requests,  newly released  comparative research  makes New Zealand look good.

The Ask Your Government! 6 Question Campaign has published a report on its survey of the effectiveness of freedom of information laws in 80 countries. New Zealand comes out in top place as the most responsive and timely jurisdiction.

The survey involved making six requests to governments for budget information and comparing the results.  The same six questions were asked in each country, and a strict methodology was followed, in submitting the questions, resubmitting them, measuring response times and evaluating answers.

“There are a number  of surprises in  the findings. These include the fact that France is among the bottom achievers… Perhaps even more surprising is that only two of the 15 countries in the top group of countries – namely New Zealand and Germany – are Western democracies, while ten are newer democracies  mostly from East and Central Europe along with South Africa and Namibia). “

The top spots ( from page 38 of the report ) are

New Zealand

Georgia

India

Namibia

Armenia

Colombia

Ukraine

Montenegro

Serbia

Bulgaria

Croatia

Slovenia

South Africa

Costa Rica

Germany

Another study, published in conjunction with the Information Commissioners’ Conference in Ottawa is less rosy.  An assessment of the “right to information” in 89 countries puts New Zealand among the middle runners in 28th place.  As in the Ask Your Government survey, few countries with long established freedom of information laws score well.  Of OECD countries, only Finland and UK rate better than New Zealand.

www.scoop.co.nz/stories/WO1110/S00107/right-to-information-nz-tops-government-information-survey.htm

 

www.rti-rating.org/results.html

www.law-democracy.org/wp-content/uploads/2010/07/6QC-Report-Publication-version-September-2011.pdf

 

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October 7, 2011

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Talking the talk?

5 October 2011

Parliament today has given the First Reading to the Members of Parliament (Remuneration and Services) Bill. If enacted, this will provide a process to distance Ministers and MPs from direct involvement in the setting of their allowances. It evolved from public disquiet about some travel allowance payments identified when the Speaker authorised the publication of MPs’ claims. The Bill reflects recommendations of the Law Commission. Interestingly this requires the establishment of yet another agency, the Independent Remumeration Authority ( or is the reference to the existing remuneration authority – a core body in New Zealand constitutional arrangements although it doesn’t fit within the definition of central government agencies as listed by State Services Commission.)

The Prime Minister commented that “It is important the public has confidence in the regime for setting MPs and Ministers’ entitlements. These changes, which put more power in the hands of independent decision makers, will increase that confidence.”

With Parliamentary business more or less concluding tomorrow, the Bill will depend on the House agreeing to restore it to the Order Paper when the new Parliament meets next year. Its Introduction however will enable Government parties to campaign on their commitment to open government, and an intention to reinforce improvements made over the last 18 months including a voluntary disclosure regime for allowances, and the curbing overseas travel entitlements.

An interesting comparison is criticism of controls in Ireland on politicians expenses claims. Public Enquiry, an anti corruption blog, continues to report incidents of elected officials abusing entitlements. Yesterday’s headline was “Politicians still abusing expenses”.

www.stuff.co.nz/national/politics/5737425/John-Key-Authority-to-handle-MPs-entitlements?utm_source=dlvr.it&utm_medium=twitter

http://www.ssc.govt.nz/sites/all/files/guide-to-central-govt-agencies-1sept11.pdf

www.publicinquiry.eu

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October 5, 2011

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Doing more with less?

4 October 2011
 
 Growing concern about the Eurozone crisis and the bankrupt European banking system spilling worldwide is niggling away at confidence in  here.   The likelihood is that measures taken in the United Kingdom, Ireland and United States to reduce the size of government  will be replicated in New Zealand.  
 
The size of agencies will inevitably diminish as budgets are reduced.  The capping data published last month by State Services Commission indicates that there was a reduction of more than 6% in FTE numbers in core government agencies over the 18 months to June 2011. More than 70% (1823) involved redundancies. As redundancies have unwelcome costs, agencies will resort to short (and often not so short) term contractors to get tasks completed. The extent to which this option meets a chief executives’ statutory duty to manage their department in an efficient, effective and economical way, is debatable.
 
Findings by the Project on Government Oversight into the US Federal Government are that contractors cost billions of dollars more than equivalent permanent staff. Research into 35 different occupational categories disclosed that the annual costs for contractors were significantly greater than for employees in all but 2 categories. Packages for some contracted lawyers were 3 times those paid to equivalent federal employees.  On average outsourcing a job costs twice as much as having it performed by permanent staff.
 
 

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October 4, 2011

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Don’t let the facts spoil a good story

 3 October 2011

The media is excited about a bottle of champagne from a questionable source that the Director of the Serious Fraud Office shared with staff to mark the filing of a complex prosecution. The likelihood is that after a State Services Commission investigation at substantial cost to the taxpayer, a Prime Ministerial observation will prove accurate; it will be a storm in a champagne flute. The perception that some bloggers have about partisan decision-making in the Erin Leigh case, revisited after the Supreme Court resolved the privilege status of officials’ advice to Ministers, and the hands-off response to colourful allegations of bullying by a chief executive, suggests that the fate of an abandoned bottle of bubbly will not be a priority – particularly as the circumstances seem too befuddled to illustrate any particular integrity principle.

Similar international media excitement last week about a United States agency has now lost its effervescence as facts come to light. “$16 muffin? Justice Dept. audit finds wasteful and extravagant spending” was the Washington Post headline. The paper’s ombudsman subsequently verified costs at $14.74 per head for breakfast and lunch (or 2 cents more than a standard government rate). Other parts of the audit report were worthy of attention. Agencies failed to comply with expectations to operate efficiently and economically. But the ethical lessons were lost in misplaced sensationalism.

http://stuff.co.nz/business/money/5723134/SFO-champagne-toast-storm-in-champagne-flute

www.bbc.co.uk/news/world-us-canada-14997843

http://www.washingtonpost.com/opinions/another-look-at-justice-departments-16-muffin/2011/09/30/gIQARIYBBL_story.html#

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October 3, 2011

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Women in top leadership: NZ falls behind

  

30 September 2011

The Institute of Public Administration (IPANZ) this week provided a forum for discussion about Anne Fitzpatrick’s recent research findings. These explore the deteriorating representation over the last 10 years of women in chief executive positions in the Public Service. The State Services Commission despite being the inevitable villain of the piece, had provided access to its records for the research. 

New Zealand is bucking an international trend. In many of the jurisdictions with which we like to be compared, a growing percentage of chief executive positions have female appointees. The trend here is markedly different. Women qualified for top positions in the Public Service apparently have a negative perception of the role and are less inclined to seek appointment than for example, their Australian counterparts. A summary of the research was published in New Zealand Management last month. 

The audience, comprised largely of the converted, was in agreement with the animated commentaries provided by Len Cook, Amanda Ellis and Karen Sewell. 

State Services agencies have a statutory duty to give effect to employment equality. This duty is reinforced by the principles of public service; fairness is one of the principles and is a primary integrity standard that chief executives are all required to maintain. 

The Open Government Partnership agreed by 46 countries at the United Nations last week emphasises gender equality as one of the four key elements for delivering on the related Open Government Declaration. Perhaps that is a reason why New Zealand has not made a commitment to the Partnership. 

Good practice in gender equality is provided by Norway which has published a white paper of its programme: 

“Norway will promote gender equality and women’s full participation in civic life, the private sector, public administration and political processes, by following up the recommendations of the government white paper on equal pay, launching an effort to have more women apply for top posts in the private sector and undertaking an initiative to strengthen the role of women in local democracy and develop a gender equality program with all municipalities. …. Today ….no committees are submitted to the Government for approval unless there is a gender ratio of at least 40–60%. ….The Gender Equality Act … includes …. a “positive duty” for promoting democracy in working life …. of public authorities and boards of private companies ….”

 

Action=View&Event_id=26&Highlight1=Anne%20Armstrong&Highlight2=Anne%20Armstrong 

www.management.co.nz/Editorial.asp?eID=56358&Wcat=102

www.ipanz.org.nz/Event 

www.opengovpartnership.org/countries/norway 

www.upi.com/Top_News/US/2011/09/20/Obama-seeks-to-improve-UN-group-to-promote-transparency/UPI-21861316548030/#ixzz1ZKwLrKzY

http://www.apec.org/Press/News-Releases/2011/0916_wes.aspx

 

　

 

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September 30, 2011

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Integrity gone awry

29 September 2011
 
Integrity is about wholeness, the art of  completeness, of doing everything properly.  Leadership requires integrity. Leaders set the tone that others will replicate. The reality is that too few in leadership roles show a wholeness in what they do. Often they lack the appreciable completeness that inspires and influences others. Where people in public sector leadership positions act without integrity, public confidence in government suffers.
 
A blogger yesterday drew attention to the sort of behaviour which undermines confidence in political leaders. The Parliamentary Order Paper  included several contentious  Bills.  Voting shows noes cast by a Member who now has a United Nations role in Afghanistan.  It appears that there was a lack of wholeness about his resignation from Parliament. He deliberately made himself unavailable  to participate in the business of the House but has relied on party voting arrangements to continue to influence parliamentary decision-making. He has not only left the country but is a salaried employee of the UN, tasked, ironically, with promoting measures that combat corruption.
 
Why are MPs not outraged?  Maybe there are fewer distinctions between New Zealand and Australia than we like to believe.
 
The Sydney Morning Herald recently alleged that the Australian Public Service is as corrupt as State and local governments.  The New South Wales Independent Commission Against Corruption has announced an enquiry into corrupt conduct by employees in 110 agencies within the State.  Australia is in a bad way if corruption is as equally widespread in the Federal Public Service. What are the implications for New Zealand?
 

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September 29, 2011

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How corrupt is the Australian Public Service?

28 September 2011

The Sydney Morning Herald, over the weekend, alleged that there is widespread corruption in the Australian Public Service. It claims that the APS may be little better than State and local government administrations throughout Australia despite having always promoted itself as much more ethical.

The paper states that “corruption in the Commonwealth government is just as prevalent as elsewhere in Australia”. Last year, in just 10 Federal agencies – and all told there are almost 1000 Commonwealth bodies of various shapes and sizes – there were just 21 cases described as corruption, and 247 cases of fraud. It claims that large numbers of allegations are never independently investigated, and that often cases that are investigated are abandoned. Over the last six years 919 investigations into fraud committed by public servants were prematurely terminated because the officers resigned.

The Australian Public Service Commission, has a responsibility for promoting integrity in much the same way as the New Zealand State Services Commission. Both are responsible for a code of conduct and have a duty to promote compliance. They have jurisdiction to investigate circumstances which may breach their codes. Criminal conduct is expected to be referred to the police for investigation. Very few cases are reported. The capacity to investigate other misconduct, particularly in the case of the State Services Commission, is nominal at best. The APSC is in the position to collate breaches of the code within agencies, unlike the SSC which seldom has any awareness of offending within the sector to which it provides ethical leadership and oversight.

Perhaps the United States has something which could be usefully replicated? US Federal agencies have an Inspector General who has an independent investigation power, separate from the audit function and at arms length from the agency head. There are 62 of them. The Government Accountability Office has reported this month that Americans seem to get monies-worth from them, gathering savings in the 2009 fiscal year of over US$43 bn for the $2.3 bn they cost to run. They were responsible also for nearly 6000 prosecutions, 1000 civil actions and nearly 4500 suspensions and dismissals.

www.smh.com.au/national/public-service-keeps-fraud-cases-private-20110923-1kpdr.html

www.gao.gov/new.items/d11770.pdf

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September 28, 2011

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