The Integrity Institute Trust Deed

The Integrity Institute was set up by Grant and Marilyn Nelson. They used to fund the Institute of Governance and Policy Studies at VUW, but took their money away when IGPS wouldn’t produce what they wanted. So they set up The Integrity Institute. It is a trust, which means its finances are secret, unlike an incorporated society which must publish annual accounts.

The trust deed is shown above. I suggest people read it and make their own minds up over whether this is a neutral institute that aims to improve integrity in politics, or whether it it is lobby group that wants to take out other lobby groups.

One interesting aspect of the trust deed is they seem to dislike lawyers. They actually ban anyone who holds a law degree from being a trustee! I can’t imagine why you would ban anyone with a law degree from being a trustee. Maybe a lawyer once ran over a pet?

The Trust Deed is equivalent to the constitution for an incorporated society. It must be followed by the board and staff. Normally a constitutional document lists aims, but doesn’t dictate a work programme. For example the Taxpayers’ Union Constitution lists general objectives around lowering the tax burden, reducing wasteful spending but doesn’t dictate specific work.

The fourth schedule of the trust deed lists the priority work which is binding on the staff, and it is incredibly detailed. There is obviously no trust in staff to develop their own work programme in line with the objectives of the Institute. It is all laid out for them, and a few items ring alarm bells about what they actually are about.

So their first aim is to undermine Transparency International New Zealand, because they don’t like the fact their Perceptions of Corruption Index usually have New Zealand as one of the best countries. They start with a conclusion (that TINZ has created a myth) and then say they want research to back to their view. This is the opposite of integrity, in my opinion.

They have done even better than that. They have given Newsroom an unspecified amount of money, so Newsroom can investigate the groups they don’t like.

It is no coincidence I suspect they named Stuff, not the Herald. Mr Nelson has stated they think the Herald has a vendetta against them.

Yes, that’s right. Their version of integrity is to pay media to conduct sting operations against groups they don’t like.

Note the direction that they are to cherry pick OECD statistics where NZ does badly. They are not to review all statistics and give a complete picture.

They have of course only listed entities whose policies they disagree with. They presumably are unconcerned with Green Party MPs going straight into CEO positions at Greenpeace and Forest and Bird.

And as far as Taxpayers Union goes, the notion of a revolving door would make you think there is some sort of secret plan to have TU staff go into government jobs etc. The reality is other organisations poach the TU staff. I am tempted to joke that if ACT steal one more staffer from the TU, I’ll blow their building up!

Note again the only examples given are groups who broadly are seen on the non-left of politics. If they really want to research the origins of the TU, they could buy the very detailed 10 year history book which actually sets it out.

Again only certain organisations are targeted. There is no interest in the influence of the CTU on policy, or Eu Tu Union. I mean you have powerful lobby groups that actually fund the Labour Party, vote in their leadership elections, and get huge policy influence in Labour-led Governments. Do you think the Integrity Institute will ever cover these?

There are actually a number of policy areas where I agree with the Integrity Institute. I don’t think Ministers should go straight from the Cabinet table to a lobbying role. I do support a written constitution. I oppose corporate welfare schemes etc. I think transparency over lobbying is a good thing.

But unlike the founders of the Integrity Institute, I apply that to all lobbying. They have a view that lobbying by anyone who makes money is bad, and that lobbying by everyone else is good.

Politik has covered them:

An institute established to expose corruption in politics is now being accused of playing dirty politics itself.

The Wellington-based Integrity Institute is financing journalists to expose what it claims are corrupt practices in New Zealand politics.

But it is who the Institute is trying to expose and how they are going about it that is raising the questions about their own integrity.

Their current target is Federated Farmers, and the Institute has funded the website Newsroom to expose what it says is the “power of the farm lobby.”

The Institute was established after a wealthy Christchurch couple, Grant and Marilyn Nelson, who had funded the Institute for Governance and Policy Studies at Victoria University of Wellington, fell out with its director, Professor Jonathan Boston.

And Federated Farmers have commented:

Langford said Federated Farmers had never heard of the ‘Integrity Institute’ until last week, when they were clearly identified as the funders of a story by David Williams on Newsroom.

“We’ve since seen the organisation’s highly prescriptive trust deed and it’s safe to say we have some significant concerns – ironically, about what seems to be a lack of integrity,” he said.

“I think Newsroom, and in particular David Williams, have some serious questions to answer about whether they’re engaging in pay-for-play journalism and dirty politics.  

“The fact that Newsroom have taken money from the Integrity Institute seriously calls into question their editorial independence and journalistic integrity.”

Newsroom co-editor, Tim Murphy, rejects those charges.

“The grant we received from the Integrity Institute came with no strings attached,” he said.

“We are free to investigate any lobby group we choose.

This is, with respect, missing the point. For this grant, they may not have been told who to investigate, but if what the do doesn’t please the funders of the Integrity Institute, then they won’t get any future grants. If they do a series of reports on how the left wing Action Station hides its accounts behind a front company, will that get them another grant? Of course not. Only by targeting the groups explicitly mentioned in the Trust Deed.

The simple reality is that if you take money from one lobby group to investigate other lobby groups, you are compromised.

Here’s my challenge to Newsroom and the Integrity Institute. Reveal how much money they are being paid by the Integrity Institute, and publish the funding agreement.

Business Desk has also noted:

The institute’s deed of trust records 26 “first priority” areas of focus, of which the first is to take down TINZ.

Specifically, point a) in the “research and educate” section is to “research the track record of TINZ to expose the myth they have created to help businesses make money by corrupting Government decision-making”.

So far, TINZ has maintained a dignified silence in response to some pretty inflammatory blogging from Edwards, who describes the organisation as having a “strategy” to undermine good public sector practice.

To anyone who’s ever interacted with TINZ, this will come as a bit of a surprise. TINZ has been advocating for better governance practices among governments for years. If anything, it is guilty of a quality of earnestness that can tend to blunt impact.

It is fascinating that the II wants to undermine TINZ, rather than work with them. In the public policy space I often see organisations work together that disagree on some things, but agree on others. The TU and the NZ Initiative often have disagreements on particular policy issues (such as petrol tax reductions) but they don’t try and take each other out because of them.

Among the Integrity Institute’s other objectives is to “pay news media expenses to conduct a sting operation to record a lobbyist and a politician agreeing to arrange special favours”, such as “to get funds or favours for a business sector”.

Journalists: form an orderly queue, but don’t hold your breath for an early result.

Again what is interesting about this is what it reveals about the Integrity Institute’s beliefs. They are convinced that lobbyists literally buy off politicians.

Finally a very insightful take by Deborah te Kawa:

Sometimes, those who claim to defend democracy are the ones who misunderstand it most. The Integrity Institute’s recent campaign, ostensibly about exposing undue influence over policy, has revealed something more troubling: a fundamental confusion about how policy advice, participation, and legitimacy actually work in democratic systems. …

The policy advisory literature has long since moved past the myth of the neutral bureaucracy. As Craft and Howlett (2012) argue, modern advisory systems are pluralised and layered. Policy advice no longer flows solely from within the state. It emerges through dynamic interaction between political actors, ministerial advisers, public servants, and external stakeholders: including iwi, hapū, academics, commentators, lobbyists, consultants, contractors, industry and community interest groups, and civil society. This is not a breakdown in integrity. It is a shift in how democratic knowledge is produced and contested; a shift that has been underway since 1996, when we began correcting for the distortions of the 1980s’ new public management reforms.

Rather than engage with this shift, the Integrity Institute appears to reject its premise. In targeting Federated Farmers, the Institute frames visible, declared advocacy as inherently suspect. Yet publishing policy platforms, meeting with ministers, or advocating for sector interests is entirely within the bounds of democratic practice. As Craft and Halligan (2020) remind us, robust advisory systems must accommodate both internal and external sources of advice. To treat advocacy as corruption is to misread the core architecture of modern policy-making.

This conflation is not just technically inaccurate. It is democratically dangerous. Legitimacy in policy does not come from insulation. As I have been exploring in the Waitangi Tribunal Thursdays series, and arguing in The Practical State, it comes from contestability, transparency, and deliberative engagement.

The bolded parts are key. We are seeing concerted campaigns to basically say that advocacy should be limited or ignored, if it is from certain sectors. They demand that public servants refuse to respond to e-mails from advocates they don’t like. They complain that officials spent more time meeting with farmers who have to implement freshwater regulations than groups who don’t have to.

It is democratically dangerous to say that the Government which has the power to pass laws and regulations that can make or break businesses, should limit interactions with those businesses.

That does not mean they should always agree with the point of view of business lobby groups. All regulations and laws produce a mixture of benefits and costs. Decisions will be made based on the respective magnitudes and priorities.

If there is corrupt secret lobbying with promises of donations for policies, I am 100% in favour of exposing those. But public open advocacy by groups such as Federated Farmers should not be seen as is any way suspect.

Anyway in the interest of integrity and transparency I look forward to the contract between the Integrity Institute and Newsroom being published.