Much ado about nothing

February 12th, 2013 at 1:14 pm by David Farrar

Hamish Rutherford reports at Stuff:

is under pressure to stand down as Building and Construction Minister, because of his role as a director of a company associated with collapsed construction group .

Associated with! Sounds bad. Did Maurice make Mainzeal collapse? No the company is what is known as a supplier!

The National MP for Pakuranga is a director on Holyoake Industries, an air conditioning specialist which had worked on a number of projects with Mainzeal, which collapsed into receivership last week.

Yes. Companies work together on building sites. Plumbers and electricians work together. Architects and builders. Still yet to see what the issue is.

Labour Party deputy leader said it was inappropriate for Williamson to hold the building portfolio while he was potentially making decisions concerning Mainzeal.

”He [Williamson] is the director of a company which has had a long and deep relationship with Mainzeal,” with projects the two companies had worked together on including the Supreme Court,” Robertson said.

”Our concern is that if he is making decisions about the future of Mainzeal, that may well have an effect on Holyoake industries.”

This is really desperate stuff. The Minister is not making decisions on the future of Mainzeal. The receivership is a matter for directors, shareholders and staff.

Labour and Green MPs have generally never worked in business. This allows them to claim any MP with any business interest is somehow conflicted. In their ideal world I guess no MP would have any business background.

Let us look at this issue. Grant Robertson is saying that it is possible that Maurice Williamson may make a decision on Mainzeal and that this theoretical decision could possibly have an effect on Holyoake and hence the Minister must resign his portfolio.

Are you serious?

In a statement Williamson said he had instructed officials that he would ”not receive papers on and would withdraw from discussions about heating and ventilation” because of his association with Holyoake Industries.

”I will continue to deal with issues related to Mainzeal, where that does not conflict with my declared personal interest.”

As is appropriate. But to claim that he can’t deal with any issue re Mainzeal because he is involved with a company that has done some work with Mainzeal is just ridiculous. It’s like saying if you are involved in a trucking business you can’t deal with any issues around supermarkets because they get their food delivered by truck.

A spokesman for prime minister John Key declined to comment other than to say it was ”not a story”.

Or shouldn’t be.

I would make the general point that I do think it is best for Ministers not to have outside directorships – for a number of reasons. But if you have them, you declare them and recuse yourself on issues affecting them – as Maurice has done. Calling for his resignation on the basis of he may make a decision on Mainzeal that may affect Holyoake is just silly politics.

UPDATE: This has just fizzled even more. PM has confirmed in the House that Holyoake is not a contractor or sub-contractor to Mainzeal. Basically they once worked on a couple of building sites together!

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25 Responses to “Much ado about nothing”

  1. Colville (2,085 comments) says:

    I used to own a HVAC company that had a relationship with Holys..we brought product from them… when we had a contract on a Mainzeal site we would install Holys product if it had been specified by the consulting engineers (and we could not find a cheaper alternative that met spec like Temperzone)
    No where in this chain did Mainzeal get to have a say in what product was installed or would have Mainzeal cared one iota. All they want is to clip the ticket on the way thru and get it done fast and clean with minimum of screaming.

    Robertson is being a total dickhead.

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  2. RRM (9,478 comments) says:

    Does Mainzeal owe Holyoake any money?

    Grant???

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  3. Elaycee (4,305 comments) says:

    For someone who regularly fuels the meme he is a ‘Labour leader in waiting’, Robertson has demonstrated a total lack of business nous when he sounded off on this particular tangent….

    Colville sums it up well:

    Robertson is being a total dickhead.

    Agree.

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  4. Colville (2,085 comments) says:

    RRM, I would doubt it. Mainzeal will owe money to a HVAC company that will owe money to Holys.
    Holys will get paid by HVAC company, HVAC company wont get paid by Mainzeal.

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  5. scrubone (3,050 comments) says:

    I’ve noted that Grant Robertson is human. He needs to immediatly withdraw from all decisions involving humans lest his conflict of interest sway his thinking.

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  6. Poliwatch (335 comments) says:

    There are a couple of points here. Firstly DPF you say
    “The Minister is not making decisions on the future of Mainzeal. The receivership is a matter for directors, shareholders and staff.”

    Decisions are now made by the Receivers. The directors, shareholders and staff now do not have a say.

    Secondly. Holyoakes are likely to be owed money by Mainzeal. They will be in the same position as other suppliers and sub-contractors. Even if the Minister was in a position to make decisions (and he isn’t) and he was to act for personal interest then it would seem obvious that those decisions would be in favour of the suppliers and sub-contractors.

    Again Robertson shows a total lack of real world experience. Perhaps someone should sit down with him and explain Company law and receiverships.

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  7. Rich Prick (1,557 comments) says:

    “Maurice Williamson is under pressure to stand down … ”

    I don’t think a pathetic simpering from Robertson as “pressure”. Williamson would be well justified in answering Robertson with a single finger.

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  8. BeaB (2,060 comments) says:

    I am sick of this idea of a ‘perception’ of a conflict of interest. Any of us can ‘perceive’ whatever we want but that doesn’t mean there is a conflict of interest which actually means more than any contact at all. Especially in our wee country.

    Williamson has been open and transparent about his directorship. It is public knowledge. There is no suggestion he has any financial or other personal interest in Mainzeal.

    This is just typical nasty Labour – throw mud and hope some of it sticks. Carry on, Muckraker Grant. This is the sure way to leadership, as Mallard has found!

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  9. Mark (1,367 comments) says:

    Apart from the fact of questioning the wisdom of a cabinet minister having directorships or active shareholdings in companies trading in the sector they have ministerial responsibilities for this has bugger all to do with the collapse of Mainzeal. Where it could become tricky is if (and one hopes it is a highly unlikely if) the Government saw some merit in bailing out Mainzeal. Now accepting that would be daft and is highly improbable Williamson would be somewhat conflicted if Holyoak was a creditor of mainzeal.

    Whilst Robertson may have a thread in terms decisions about Mainzeal it is a very thin one and Williamson is a bit canny and experienced to be caught up by it. call it Robertson clutching at straws

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  10. Lipo (229 comments) says:

    So the real question as Mark rightly points out
    ” wisdom of a cabinet minister having directorships or active shareholdings in companies trading in the sector they have ministerial responsibilities”

    A clear case of a conflict of interest

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  11. labrator (1,750 comments) says:

    The only people that should be making decisions about businesses are those that have no experience in running them.

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  12. PaulL (5,875 comments) says:

    @Mark: I agree completely. I think it much preferable if Ministers have no knowledge of the sector, no friends, family members or associates in the sector, and no pre-conceived opinions. Then they can either make broad policy pronouncements with no understanding of the issues, or they can be completely beholden to their advisors and their department for all information. I reckon that gets a much better outcome for everyone.

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  13. Lipo (229 comments) says:

    How about we turn the situation around
    Lets say I was importing from a Chinese company that had a senior Chinese government member on it’s governance board. The product they were contracted to supply was defective and I wanted to get the Chinese authorities (like our commerce commission) to investigate.
    How would I think this investigation would go before I started action?

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  14. bhudson (4,734 comments) says:

    That’s Grant Robertson – focusing on what’s important.

    There’s the next Labour leader for you, right there…

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  15. dime (9,472 comments) says:

    gee DPF, thats the next Prime Minister?

    he seems about as capable as adern

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  16. RightNow (6,676 comments) says:

    dime – more like he seems about as capable as a limp dern

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  17. alwyn (381 comments) says:

    @scrubone at 2.22pm

    Are you quite sure about Robertson being human?
    He looks like something out of a vampire movie to me.

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  18. scrubone (3,050 comments) says:

    He looks like something out of a vampire movie to me.

    Actors are human too… though that would explain a lot of what Robin Malcom gets up to.

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  19. wreck1080 (3,735 comments) says:

    The story on last nights news was that holyoake was a subcontractor and owed money by mainzeal.

    Then, if maurice bails out the subbies he is effectively acting out of self interest.

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  20. Joseph Carpenter (210 comments) says:

    Colville is correct. Holyoakes is a MANUFACTURER, they do not carry out installation work, they supply to HVAC subcontractors, they do not have any relation with Mainzeal, they do not fall under the Construction Contracts Act or the normal building contracts (NZS3910, NZIA SC1, NBC1, etc), they will have normal supply only trading terms with the subcontractor, Mainzeal would have no say in the use of Holyoake products which are normally only used in large complex commercial work – the decision on their use would be solely down to the original designer and specifier (typically and Architectural and/or engineering firm) and any decision to substitute Holyoake for a specified product would have to be approved by the Clients agent – not the Contractor.

    This is no different to saying that if Williamson was a director of say United Steel because they made the nails supplied to site, even less so because they nails would be supplied to Mainzeal direct and not to a third party. Williamson is a useless lazy prick, controlled by the DBH, seriously interfering in the building industry and adding a lot of extra cost for no real benefit (most people don’t realize the extent of Restricted Work and LBP’s which started in 2012), but this particular issue can’t be held against him.

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  21. Joseph Carpenter (210 comments) says:

    Also if any affected subbie is reading this – get a lawyer expert in the Construction Contracts Act (and no a normal commercial lawyer is useless). Make sure you get in a valid payment claim under CCA cl.23 & 24, the CCA will over-ride normal company and contract law, in particular cl.79 means the receiver can’t set aside a Statutory Demand or offset/deduct payments.

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  22. Viking2 (11,147 comments) says:

    Actually the mopre important issue around Williamson is that he considers that the law around companies andthese situations is adequate. That he thinks this show’s either a lack of sound knowledge or a lack of intelligence.
    The recievership was bought about bythe BNZ demanding its money, which it is entitled to do. The result is that the bank is covered, the wages are covered, the IRD get’s their chop and the balance of the creditors are out in the cold unless there is sufficient recovery.
    The problem here is that despite the company having a plan to clear the debts and some 40 work ites in operation they have only one option.
    Where Williamson should Act is to do what business has been calling for for years and that is to provide for a Chapter 2 bankruptcy option as they do in USA. That will stop the rape and pilage of buisneeses going thru tough times where the inevitable result is that contractors are screwed by all an sundry including but not exclusively the receivers and the Banks.
    The Banks have total power over this and no one has a defense.

    Companies have issues and sometimes a hand up is better than destruction. Destruction in this case will cost Kiwi’s very dearly for the benefit of the BNZ and the Receivers.

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  23. BigFish (132 comments) says:

    @PaulL: I agree completely. I think it much preferable if Ministers have no knowledge of the sector, no friends, family members or associates in the sector, and no pre-conceived opinions. Then they can either make broad policy pronouncements with no understanding of the issues, or they can be completely beholden to their advisors and their department for all information. I reckon that gets a much better outcome for everyone.

    How about the ministers don’t carry directorships or have interests in any company or organisation that might (at the least be seen to) pose a conflict of interest? Same reasonable rules that most private sector companies have for their own employees.
    You can have as much relevant experience as you wish. For that matter – is a directorship for an HVAC manufacturer particularly relevant experience?

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  24. OneTrack (2,621 comments) says:

    “The only people that should be making decisions about businesses are those that have no experience in running them.”

    You mean Labour and the Greens?

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  25. Paulus (2,503 comments) says:

    This really about Grant Robertson pushing himself forward as the Alternative Labour Leader come August.
    Once again the scheme is set – Cunliffe has been shafted again by the Robertson lokk alike cohorts.
    10 Abstentions in the secret leadership ballot.
    Robertson is trying to look big in Parliament in his new suit and tie – Leader in waiting – verbally and stategically he can piss all over Shearer – he is Clark/Simpson trained.
    He has stacked the leader’s office with his “own” kind of followers.
    Watch this space over the next 6 months as the Robertson team take the public lead.
    Shearer will just resign as leader – there will be no votes – other than unanimous for Robertson.

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