Kiwiblog

Before I turn to the substance, let us all laugh at this claim from Phil Goff:

“They (directorships) should have been resigned immediately. He would have been briefed as soon as he became minister,” Mr Goff told Radio New Zealand.

“I think that if you breach the cabinet manual in terms of conflict of interest, you’re gone.

“That was certainly the way (former prime minister) Helen Clark ran (things) and I would, too.”

Two words – Winston Peters.

Winston trampled all over the Cabinet Manual. He didn’t declare multiple gifts. He had wealthy donors pay personal expenses on his behalf, and then advocated policy changes that would benefit them. He never declared any of these interests.

And what did Phil Goff and Helen Clark do? They defended Peters. They even voted against the Privileges Committee report (something not even Jim Anderton could bring himself to do).

So Goff’s claim that Labour would have sacked Worth, should be seen for the bullshit it is.

Worth is a brand new Ministers. Key in his own words has bollocked him and given him a final warning. That by itself is a million miles more than what Labour did in the past.

I am glad to see Key take a very tough line here. I am a bit of a purist and think a Minister is a fulltime job. Business interests should be put to one side during your time as a Minister.

Tags: Cabinet Manual, John Key, Phil Goff, Richard Worth

The Parliament website now records the amended return by Winston Peters for the year to 31 January 2007.

A gift from the Spencer Trust towards his electoral petition costs has been declared.

This would never have come to light if it were not for the SFO. Peters and Henry supplied false evidence to the Privileges Committee about this issue.

Now Peters has officially declared the gift, known to be $40,000, the ball is in the PM’s Court. The Cabinet Manual says:

Ministers who accept gifts worth more than the prescribed value must not only disclose them to the Registrar of Pecuniary Interests of Members of Parliament, but also must relinquish them, unless they obtain the express permission of the Prime Minister to retain them.

Helen Clark must give her “express permission” or Peters is required to relinquish the gift.

Will Clark give her permission for a Minister to keep what was effectively a personal donation of $40,000? That is 80 times greater than the disclosure limit and probably the biggest gift by a magnitude ever received by a Minister.

And is the Prime Minister at all concerned that the ultimate source of the money was almost certainly the Velas? Does she think Cabinet should have been informed of these personal donations to the Minister of Racing, when they accepted his recommendation to spend taxpayer money on bigger prizes for horse races?

Tags: Cabinet Manual, Helen Clark, MPs Register of Pecuniary Interests, Spencer Trust, Vela Family, Winston First

The latest news on Winston’s trip to Las Vegas confirms that Helen Clark is operating two sets of standards – one for Winston, and for other Ministers. Winston could rob a bank in broad daylight, and Helen would happily keep him on.

Let us go to the Cabinet Manual, section 2.113:

Subject to parliamentary or portfolio requirements, and with the prior approval of the Prime Minister, Ministers may occasionally extend overseas visits outside the formal itinerary for personal reasons, provided no additional costs are incurred by the government as a result.

Now it is as clear as it can be, that Winston Peters was required to get Helen Clark’s permission for the sidetrip to Las Vegas. Clark says she only learnt of it two weeks ago. Now by itself this isn’t a hanging offence, but what it illustrates is how Clark operates a totally different set of standards with Peters. Peters knows Clark won’t touch him, so he doesn’t bother with minor stuff like accountability or rules.

There is also some confusion about whether or not Clark did know more than two weeks ago. Whale Oil alleges that the unapproved side trip was discussed at the MFAT Divisional Officers’ Meeting which includes PM’s foreign afairs advisor from DPMC. So if Clark did not know, then her Department did.

Matthew Hooton also reports that George Calvert has denied paying for the sidetrip to Vegas. Now the lanugage used here (and one has to be suspicious when it involves Winston and friends) suggests the denial only applies to the airfares – not necessarily the accomodation and match tickets. Because if someone other than Peters did pay for them, and the cost was over NZ$500, then Peters has breached (again) the Register of MPs Pecuninary Interests and the Cabinet Manual (again).

Queen Bee asserts that the taxpayer originally paid for the flights and the accommodation. which is what caused all the fuss in MFAT. The money was repaid, but it is not known when – was it after questions were asked?

The best case scenario is that Peters has broken the Cabinet Manual, and Clark has demonstrated she has will not enforce any rules on Peters, so long as he votes for her. The worst case scenario is that the taxpayer paid for personal travel, it was only refunded when found out, and also gifts in excess of $500 were not declared. It is important to stress that there is no public proof of the worst case scenario at this point in time. Only the best case scenario has been proven. The worst case scenario can be proven false in just five minutes with the appropriate receipts.

Tags: Cabinet Manual, Helen Clark, Las Vegas, MPs Register of Pecuniary Interests, Winston First

Matthew Hooton blogs some useful info on the Peters trip to Las Vegas:

The Foreign Minister has confirmed that he made the “sidetrip” when he was in Berlin entroute to Singapore, so some “sidetrip” it must have been.

You can fly from Berlin to Singapore, via Frankfurt, on Lufthansa and Singapore Airlines for the discounted Business Class fare of around NZ$7730.50.  (I don’t know why on earth the HoS would assume, as it did, that Peters would fly economy – he was meant to be working on this trip, remember.)  It is quite an efficient way of getting from Berlin to Singapore, taking a total of around 14 hours.

In contrast, getting even from Berlin to Las Vegas is considerably more arduous, taking at least 16 hours, and requiring at least two stops.  Getting from Las Vegas to Singapore can also be difficult, taking almost 24 hours on United Airlines.  Book Business Class Berlin/Las Vegas/Singapore on United Airlines and it will set you back around $15,500.

To be square with the taxpayer, it seems the Foreign Minister would have had to pay about $8,000 for the tickets alone (and god knows what sort of condition he would have arrived in, in Singapore, after flying halfway around the world and stopping over in Las Vegas for a fight, but he is known for his resilience.)

That is a very expensive diversion indeed.

The average ticket price for the fight was said to be over US$1,300.  So the total cost of the Foreign Minister’s “sidetrip”, paid by him personally, would have been over NZ$10,000.

I hope he enjoyed himself for that amount.  He must be a big boxing fan.

A huge fan.

We must take the Foreign Minister at his word that he personally paid this ten grand.  It would put the whole matter to rest to see the receipts.  And also the dates on them.

Yep that is all that is needed. Just as all Brian Henry needs to do is produce a phone log showing his multiple calls to Owen Glenn.

And it would be also interesting to know if the Prime Minister approved the sidetrip and knew how it was to be financed.  From my memory working for the Trade Minister in the 1990s, prime ministers have to approve all ministerial travel, including sidetrips.  This remains part of the Cabinet Office Manual:

“2.113 Subject to parliamentary or portfolio requirements, and with the prior approval of the Prime Minister, Ministers may occasionally extend overseas visits outside the formal itinerary for personal reasons, provided no additional costs are incurred by the government as a result.

“2.114 Ministers may make personal visits overseas if they obtain the Prime Minister’s prior approval, which will be subject to obtaining leave to be absent from the House. Ministers must also obtain the agreement of another Minister or Ministers to act during such periods of absence. (See paragraphs 2.39 – 2.42.) The Cabinet Office should be advised of any such arrangements.”

Well maybe Helen can clear this all up for us. She would have approved it. As Matthew says this may all be a load of nonsense. So best to expose it for the nonsense it is as soon as possible.

Tags: Cabinet Manual, Helen Clark, Las Vegas, Matthew Hooton, Winston First

The NZ Herald says this week will see a focus on the PM’s knowledge of the Owen Glenn donation.

The more I think about it, the more appalling it is that she said or did nothing. Let us first dispose of her claims that she had no choice but to accept Peters’ word.

1. The convention of accepting the word of an MP, only applies in the House itself. There is no such convention in the wider political sphere.
2. More importantly, accepting someone’s word only applies up until there is evidence which contradicts that word. The direct testimony of Owen Glenn that he donated $100,000 to assist Winston Peters is evidence.
3. In previous cases where the evidence contradicts what the Minister says, Clark has asked to examine the evidence. She had her staff examine media tapes of Benson-Pope’s interviews to determine he had lied, and sacked him.
4. This was not a case where one had to accept the word of Glenn over Peters or vice versa. A donation is a provable fact and she could have gained absolute proof with a single phone call.
5. She could have urged Peters to contact Glenn to find out why he thinks he donated. That would be the 100% logical thing to do, unless you suspected Glenn was right and Peters was lying.

Now let us look at all the things one may have expected an ethical Prime Minister to do. Did she do any of the below?

1. Seek legal advice from the Cabinet Secretary or the Solictor-General as to whether she had an obligation to disclose Glenn’s revelation that he had donated $100,000 to assist Peters.
2. Inform the Electoral Commission that she has information which warrants investigation as to the accuracy of NZ First’s 2005 return. OR
3. Inform the Registrar of MPs Pecuniary Interests that she has information which warrants investigation as to the accuracy of Winston Peters’ 2005 return.
4. Inform the Secretary of Foreign Affairs that Owen Glenn had told her that he had donated $100,000 to assist the Foreign Minister, and that this created a conflict of interest for Peters in determining whether or not to appoint Glenn Consul to Monaco

Just as bad, she sat there while Winston Peters did his infamous “No” press conference, knowing that Owen Glenn had told her it was yes.

And even worse on the 18th of July, when Peters announced the $100,000 donation, she knew conclusively he was lying as Peters said the first he knew about the donation was earlier that day when Henry told him. But he knew, at a minimum, back in February when the PM told Peters what Glenn had said.

People need to understand that the entire last six months has been a charade. When Winston Peters pretended to be angry at the allegations, Clark knew that Glenn had told her that he has donated.

Even when Peters outrageously slandered the NZ Herald, accussed them of fabricating the Glenn e-mail, and demanded Murphy and Young resign, Clark stayed silent. It was an inaction unworthy of the highest office in the land.

Peters was actively considering Owen Glenn for a diplomatic appointment. Clark had been told by Glenn that he had donated $100,000 to assist Peters. This created a huge conflict of interest. But it seems Clark sat on this information. Doing so undermines the integrity of her Government.

And finally we have the hypocrisy. The rhetoric about how we needed the Electoral Finance Act to stop secret donations to political parties. And two months after that law was passed, Helen Clark learnt of a huge $100,000 secret donation. Even worse she learnt of it from a man seeking favours from the Minister he claimed to have donated it to benefit. But did she do anything at all? Did she demand the donation be revealed as she had just spent six months vowing that such donations be exposed? No she just sat there and asked no questions, and allowed Peters to keep denying it.

Tags: anonymous donations, Cabinet Manual, Electoral Commission, Electoral Finance Act, Helen Clark, MFAT, Monaco, MPs Register of Pecuniary Interests, Owen Glenn, Winston First

From Wednesday:

John Key: Is the Prime Minister aware, and can she confirm, that Section 2.79 of the Cabinet Manual requires Ministers to obtain her express permission to keep gifts valued at more than $500; and will she not accept that Mr Peters, by his own admission, has now admitted that he received a gift of $100,000 from Mr Glenn, and, whether or not she likes it, has to determine whether he will be allowed to keep that gift?

Rt Hon HELEN CLARK: I say again that whether the sum is a gift is a matter for the registrar of pecuniary interests. But can I further make the point that immediately Mr Peters was told of the source of that particular donation to a legal fund, he declared it to me. The Cabinet Office advised me that the court case, of course, was one of particular public interest—considerable public interest—and in such circumstances, if, and I underline that word, such a sum of money were deemed to be a gift, there would be no reason to require a Minister to relinquish it.

Now consider the weasel words here. First of all we have the declaring the court case was somehow in the public interest – as oppossed to the very private interest of Winston Peters who was trying to overturn the acual election result.

But secondly she is suggesting that Owen Glenn paying $100,000 of Winston’s debts is in the public interest and okay. Now maybe you could argue this if the donation was made before the court case – in order to allow it to proceed. But the timing is that Peters took the case and lost, and then Glenn helped him pay the costs.

And remember that the PM knows that Owen Glenn was lobbying Peters to lobby her to be appointed Consul – and she has said it is okay for him to keep the $100,000 gift. She has now succesfully approved American style funding for NZ.

Rt Hon HELEN CLARK: As I told the House yesterday, I would be absolutely delighted to see corporate and large private donations banned, on the basis that there would need to be State funding.

Helen wants to ban companies from being able to donate, but not unions. This shows her true agenda.

Sue Bradford: Does the Prime Minister have confidence that the Minister for Racing acts at all times with the interests of the whole racing sector at heart, or does she have any sense, as some in the racing industry do, that his actions tend to favour those at the high end of the industry, which, incidentally, is the same end from which New Zealand First has received substantial donations?

Rt Hon HELEN CLARK: Obviously, I do not have any independent information about where donations come from, but I can say to the member that I have had absolutely no advice or, indeed, even any suggestion of the issue of preference that she has raised.

Clark needs to look at the last Budget.

John Key: Did Winston Peters ask for the racing portfolio when the Prime Minister allocated the portfolios in 2005?

Rt Hon HELEN CLARK: Yes.

Clark was ready with that answer.

Metiria Turei: Does the Prime Minister think that the Government’s failure to get the numbers to progress sustainability measures like the Marine Reserves Bill and the Fisheries Amendment Bill may have anything to do with the large financial contribution to the party of her Minister of Foreign Affairs from Vela Fishing

NZ First did not like this question.

Dr Russel Norman: Do any of the Prime Minister’s Ministers receive donations from industries they are meant to be regulating and taxing; and does she expect any Minister, including her Minister of Racing, who finds himself or herself negotiating tax breaks for party donors to bring that to her attention?

Rt Hon HELEN CLARK: I do think there was in that question exactly the implication that Mr Mark objected to before. I can say, in respect of Ministers, that they are not expected to receive donations from industry, at all.

The Greens may have been as silent as a mute on the Owen Glenn donation, but they are being zealous with the Vela donations.

Hon Dr Nick Smith: I raise a point of order, Madam Speaker. I contacted the registrar of pecuniary interests and sought advice as to what disclosure requirements I was to make. The registrar was clear that what I needed to declare was a pecuniary interest in a trust. I have done just that. I seek leave to table the pecuniary interest declaration that I made on that advice, which clearly states there was a trust that provided support for that legal action.

Rt Hon HELEN CLARK: It therefore follows from Mr Smith’s point of order that if that were the appropriate course for him to follow and that he does not have to declare either debts or gifts, then nor does Mr Peters.

Clark is being stupid or misleading here. Nick Smith has an actual legal trust established which has trustees and he has declared he is a beneficiary of this. That is different to Winston who has no such legal trust but instead donors just pay off bills on his behalf. The Standing Orders make it very clear how each situation is treated.

And in another question:

Rodney Hide: Has the Prime Minister asked Winston Peters whether he knew that Mr Brian Henry was soliciting and receiving funds on Mr Peters’ behalf, as Brian Henry has said he was doing, and has she asked also on what date Mr Peters learnt that his legal bill had been reduced by $100,000; if not, why has she not asked Mr Peters those questions—is she concerned about the answers?

Rt Hon HELEN CLARK: No, I have not asked those questions. The matter is clear to me. Mr Peters has advised me that he was advised late on Friday of the source of the money going to his lawyer. He had not known the source of that money before then. I believe that Mr Peters, like other sensible party leaders, keeps a great distance from the issue of soliciting funds.

Clark here ignores the salient point of the question. Rodney did not ask anything about the identity of the $100,000 – just why she did not ask Peters when he knew he had had his legal bill reduced by $100,000. For you see that is when he should have notified her.

Rodney Hide: Let us have something to look forward to here in the House. I raise a point of order, Madam Speaker. The Prime Minister is consistently and wilfully dodging the questions that Mr Copeland and I have been asking, by saying that Mr Peters did not know about the source of the donations. My question specifically asked whether Mr Peters knew that money was being solicited—not the source of the donations, but the fact that the money was being solicited.

Madam SPEAKER: I have listened very carefully. The Prime Minister, like all Ministers, is required to address the question. However, Ministers are not required to give the answer that members want to hear. The Prime Minister addressed the question.

Rodney caught on that Clark keeps refusing to answer that question. That is because she knows Peters should ahve declared the $100,000 the moment he knew his legal bill had been reduced by that amount.

Tags: anonymous donations, Cabinet Manual, Greens, Helen Clark, John Key, MPs Register of Pecuniary Interests, Owen Glenn, Vela Family

No Right Turns blogs on Helen Clark’s see no evil policy:

Despite clear Cabinet guidelines about the declaration of interests and a separate (but sadly confidential) process for Ministers to declare interests, Clark insists that it is nothing to do with her, but instead a question for the Registrar of Pecuniary Interests. This is simply false; the question of whether Peters has failed to properly notify Parliament of his interests and the question of whether he has failed to properly declare and manage his interests as a cabinet minister are completely separate.

Nothing is more squarely a duty of the Prime Minister but to judge how her Minister’s handle interests.

Clark says Peters can keep the money. Under s2.79 of the Cabinet Manual, gifts of more than $500 must be relinquished unless the Prime Minister permits them to be retained. According to Clark, the gift paid for a legal case which served a substantial public interest, and so she has no problem with it being retained. This isn’t unreasonable, given the frequency with which MPs are involved in legal action, and it is nice to have it made clear.

Unfortunately, Clark entirely evaded the question of whether giving a minister $100,000 when you wanted a job from them created a conflict of interest. The answer is obvious, and it is shameful that she refuses to state it and stand up for proper standards in the executive.

This is very significant that Clark has approved Peters keeping the secret $100,000 donation. She knows that Owen Glenn was lobbying Peters to be given a diplomatic appointment and that Peters had discussed the issue with her.

I am surprised people have not wondered why Owen Glenn would decide to donate $100,000 to a secret legal fund for Winston Peters. What was his motivation?

Well let us look at why he donated to Labour. He said he liked their policy of supporting a free trade agreement with China. But NZ First is totally opposed to that agreement, so he did not donate because he likes their policies I presume.

Maybe he just liked Winston, and wanted to help him. Strange though that he never mentioned it in all his meetings with him.

It would be interesting to have someone ask Winston the dates of all his meetings or conversations with Owen Glenn, and when he first raised the issue of Consul.

It would also be interesting to know when Brian Henry received the money and first talked to Glenn about a donation.

I am not saying there is a linkage, but the timings would be useful for people to be able to make a judgement call.

Tags: anonymous donations, Brian Henry, Cabinet Manual, Helen Clark, Labour, Monaco, No Right Turn, Owen Glenn, Winston First

Some may think that there is less of an issue for Peters having had the donation go to pay for his private legal expenses, rather than to NZ First itself. I am of the view this makes things much worse for him.

NZPA reported:

He said that since 1991 he had been involved in 14 legal actions which had been partly funded through donations, and Mr Henry had “a firm policy” of not disclosing the source of donations.

“I have never been told the source of these donations but have personally met the shortfall which has amounted to many hundred thousands of dollars,” Mr Peters said in a statement.

Now this makes very clear that the secret donation was effectively a donation that benefited Winston Peters personally. If they had not received that $100,000 then Peters by his own words would be making up the shortfall.

The first issue this may raise is the tax status of the donation. Peters is not a charity, and the donation is well above the limit for personal gifts. Who exactly was the donation made out to? What account was it paid into? Who controls that account? What is the legal personality that received it? Was tax paid on it if tax is liable?

The next issue is the Cabinet Manual. First some general clauses:

2.52 A Minister of the Crown, while holding a ministerial warrant, acts in a number of different capacities:

1. in a ministerial capacity, making decisions, and determining and promoting policy within particular portfolios;
2. in a political capacity as a member of Parliament, representing a constituency or particular community of interest;
3. in a personal capacity.

2.53 In all these roles and at all times, Ministers are expected to act lawfully and to behave in a way that upholds, and is seen to uphold, the highest ethical standards. Ultimately, Ministers are accountable to the Prime Minister for their behaviour.

So the question for the Prime Minister is has her Minister of Foreign Affairs acted in a way which has upheld the highest ethical standards in not just their ministerial capacity, but also their political and personal capacity.

2.55 All members of Parliament are required to disclose certain assets and interests in an annual Register of Pecuniary Interests of Members of Parliament. This register, administered by the Registrar of Pecuniary Interests of Members of Parliament, is designed to promote accountability and transparency by identifying personal financial interests that might influence members of Parliament.

We will come back to the Register of Pecuniary Interests.

2.56 Additional requirements apply to Ministers’ interests. Conflicts of interest may arise between Ministers’ personal interests and their public duty because of the influence and power that Ministers exercise, and the information to which they have access, both in the individual performance of their portfolio responsibilities and as members of the Executive.

In other words the bar for Ministers is even higher than for MPs.

2.59 Ministers themselves are responsible for proactively identifying and reviewing possible conflicts of interest and ensuring that any conflicts of interest are promptly addressed by taking one or more of the measures set out in paragraph 2.70.

Note the requirement to be pro-active in identifying conflicts. This may mean things like asking your lawyer who donated $100,000 to you.

2.78 The Standing Orders require members of Parliament to disclose to the Registrar of Pecuniary Interests of Members of Parliament any gift accepted over a prescribed value, currently $500. This declaration includes hospitality and donations in cash or kind.

So a donation is a gift, and must be declared if over $500.

2.79 Ministers who accept gifts worth more than the prescribed value must not only disclose them to the Registrar of Pecuniary Interests of Members of Parliament, but also must relinquish them, unless they obtain the express permission of the Prime Minister to retain them.

Now it gets interesting. The PM gets to decide if you get to keep the gift. So Helen has to decide whether or not Winston can keep the $100,000 that was donated towards his legal expenses.

Now let us look at Standing Orders, namely Appendix B:

4(1)(d)Every return of pecuniary interests must contain the following information as at the effective date of the return: the name of each trust in which the member has a beneficial interest, and

And also let us look at the Register as at 31 January 2007,

4 Beneficial interests in trusts
WRP Family Trust

So if the bank account it was paid into is an actual trust fund that helps pays Winston’s legal bills – it is not listed as required.

Now let us look at Section 7(b)

a description of each gift (including hospitality and donations in cash or kind but excluding any donation made to cover expenses in an electoral campaign) received by the member that has an estimated market value in New Zealand of more than $500 and the name of the donor of each of those gifts (if known or reasonably ascertainable by the member),

Now even if (and it is a big if) Peters did not know the name of the donor, he did know there was a $100,000 donation towards his legal expenses and this was not declared. He should have declared an anonymous donation towards his legal expenses. He actually did not have to disclose the amount – but he did need it disclose the existence of it.

Now maybe you argue he did not receive the donation himself so let us turn to 7(c)

a description of all debts of more than $500 that were owing by the member that were discharged or paid (in whole or in part) by any other person and the names of each of those persons,

And we have been told these donations were to pay his legal bills and expenses. So it should have been declared under either 7(b) or 7(c). Unless you argue that the money went into a trust with a separate legal personality – but if that is the case then the trust should have been disclosed in Section 4(1)(d).

So who should sort this out. Here is one possibility:

15 Auditor-General’s review and inquiry
(1) The Auditor-General will review the returns provided under clause 14 as soon as is reasonably practicable.
(2) The Auditor-General may inquire, either on request or on the Auditor-General’s own initiative, into any issue as to whether—
(a) any member has complied, or is complying, with his or her obligations under this Appendix

So the Auditor-General could investigate. There is also another option:

Without limiting the generality of Standing Order 399, the House may treat as a contempt any of the following:

(h) as a member, knowingly providing false or misleading information in a return of pecuniary interests:

So an MP could ask the Speaker to refer the issue to the Privileges Committee. My suggestion would be both avenues – ask the Auditor-General to investigate and ask the Speaker to refer the issue to the Privileges Committee.

People may claim Peters did not know about the donation. Even if one accepts he did not know Owen Glenn made the donation, he did know that his legal expenses shortfall had suddenly reduced by $100,000 and failed to disclose it.

But also to the point, his lawyer Brian Henry would beyond any reasonable doubt be very very aware of the requirements placed on Peters by the Cabinet Manual and the Parliamentary Standing Orders. As his lawyer he would I suspect have professional and ethical obligations to make sure returns filed were correct and that Peters was in possession of the necessary information to make correct returns. I think there are as many questions for Mr Henry as Mr Peters about this.

So the issues are:

1. Does Helen Clark think her Minister of Foreign Affairs has upheld the highest ethical standards in his ministerial, political and personal capacity?
2. Will Helen Clark allow Winston Peters to retain the $100,000 gift from Owen Glenn – it is her decision as Prime Minister.
3. Can the PM explain why the Government has reversed or is reviewing its position from 2003/04 on not needing a Consul in Monaco?
4. Will an MP file a matter of privilege with the Speaker before the next sitting of the House on Tuesday?
5. Will the Auditor-General investigate on his own initiative?
6. Will the Inland Revenue Department investigate the tax status of the donation?

Tags: Brian Henry, Cabinet Manual, Helen Clark, MPs Register of Pecuniary Interests, Owen Glenn, Standing Orders, Winston First