Well done Microsoft

AFP reports:

US software giant Microsoft has expressed concern over a report that anti-software piracy laws were being used to stifle dissent in Russia and announced steps to try to halt the practice.

The Microsoft statement followed a report in The New York Times that the Russian authorities had used piracy charges concerning Microsoft software to confiscate computers and harass non-governmental organisations (NGOs).

“As general counsel for Microsoft, it was not the type of story that felt good to read,” Microsoft senior vice president and general counsel Brad Smith said in a blog post.

“Whatever the circumstances of the particular cases the New York Times described, we want to be clear that we unequivocally abhor any attempt to leverage intellectual property rights to stifle political advocacy or pursue improper personal gain,” Smith said.

“We are moving swiftly to seek to remove any incentive or ability to engage in such behaviour,” he said.

I’m pleased to see Microsoft take a strong stand on this issue. I spoke to a Microsoft regional conference in Singapore earlier this year, and one of my criticisms/suggestions was that they don’t seem to show much interest in issues around the Internet, in contrast to Google.

Smith said Microsoft had internal teams around the world looking at the issues and was seeking advice from human rights advocates.

Microsoft also plans to retain an international law firm not involved in anti-piracy work to conduct an independent investigation and provide advice on new measures the Redmond, Washington-based company should take, he said.

In the meantime, “to prevent non-government organisations from falling victim to nefarious actions taken in the guise of anti-piracy enforcement, Microsoft will create a new unilateral software license for NGOs that will ensure they have free, legal copies of our products,” Smith said.

“We’re creating in Russia a new NGO Legal Assistance Program focused specifically on helping NGOs document to the authorities that this new software license proves that they have legal software,” he said.

Great. That’s a superb response.

Smith said Microsoft seeks to “reduce the piracy and counterfeiting of software” but wants to “do this in a manner that respects fundamental human rights.”

“Piracy is a very real problem,” he said. “But none of this should create a pretext for the inappropriate pursuit of NGOs, newspapers, or other participants in civil society.”

Again, really pleased to see Microsoft take an appropriately balanced view.

Garrett’s conviction

The Herald reports:

Act’s law and order spokesman, MP David Garrett, was convicted of assault in 2002 in Tonga, he confirmed last night.

Mr Garrett, who led the party’s “three strikes” policy on tougher sentencing for serious violent offences, has not publicly disclosed his conviction.

But Act leader Rodney Hide said Mr Garrett had disclosed it to him before he joined the Act list at No 5 for the 2008 election.

It was the right thing, to disclose it to the party. The issue is whether it should have been disclosed publicly.

Mr Garrett issued a statement giving his version of events after TV3’s Campbell Live last night revealed the conviction.

Mr Garrett, who worked as a lawyer in Tonga, said he was attacked outside a bar in Nuku’alofa by Dr Mapa Puloka, head of psychiatry at the local hospital.

Campbell Live claimed the altercation was over Dr Puloka’s former wife.

Mr Garrett said his own jaw had been broken in two places after he was attacked from behind.

He had returned to Middlemore in Auckland for treatment and then laid a complaint with the Tonga police. After Dr Puloka was charged with assault, he in turn laid a complaint of assault against Mr Garrett.

Mr Garrett denied the assault and produced two witnesses, the bar’s bouncers, at the trial but was convicted and fined $10.

He had immediately lodged an appeal and has yet to be given a reason as to why it has been delayed.

Dr Puloka was fined $100.

The fact Puloka’s fine was ten times greater than Garrett’s suggests he was the aggressor.

Many MPs have minor convictions but Mr Garrett’s non-disclosure is more relevant because crime is the primary focus of his parliamentary career.

If it was any other MP, then there would be little interest in a $10 fine. conviction. But considering the strong stand David has taken on law & order, it would have been wiser to reveal the conviction (and his side of the story) early on.

But that is the only criticism I would make. I don’t think it undermines the stance David has taken on law & order issues, and his commitment to tougher sentences.

The Canterbury legislation

The Herald reports:

The Government has won support from its political rivals for emergency earthquake relief legislation that will bypass existing laws to speed up rebuilding in Canterbury.

Prime Minister John Key said yesterday that the quake – with a repair bill expected to be more than $4 billion – was New Zealand’s most costly natural disaster.

The Canterbury Earthquake Response and Recovery Bill, expected to be passed in Parliament today, would help recovery efforts.

It would allow ministers to use “orders in council” to bypass the normal parliamentary process and overrule or relax existing legislation – including local body bylaws – to speed up rebuilding efforts.

“The bill is recognition that legislation such as the Building, Local Government and Resource Management Acts are not designed for the special circumstances Canterbury faces.”

I think few would disagree that the normal resource consent process is inappropriate for recovery from a Christchurch. You can’t have people waiting months and years to be able to do repairs etc.

Labour leader Phil Goff said his party would support it “so the people of Canterbury can get on with rebuilding their region”.

Well done Labour.

The new law will also establish a Recovery Commission made up of the mayors of Christchurch, Waimakariri and Selwyn, three Government appointees and an independent chairperson.

Mr Brownlee said the commission would ensure that rebuilding efforts, particularly for sewage and waste infrastructure, were co-ordinated and done in conjunction with the Government.

Seems sensible.

This suggest to me that one needs Mayors who are good team players, and can work well with others to achieve progress.

I was on RNZ’s Panel yesterday and former Christchurch Mayor Garry Moore joined us for a discussion on Christchurch. I asked Garry what sort of leadership Christchurch needs going forward, if one looks at two models of leadership, being:

  • The team leader – someone good at working with others, bringing the best out of a team.
  • The “my way of the highway” leader, where a strong leader says do it my way.

Garry said that Christchurch needs a Mayor who can be collaborative and work with others. I’ll leave it to readers to work out who they think fits better into each category.

ICT in New Zealand: 50 Years On

This week I’ll be attending and live-blogging from NZCS’s 50th Anniversary Conference in Rotorua. The conference is intended to be a celebration of 50 years of ICT across the sector, not just of NZCS. I find it amazing NZCS is 50 years old – one tends to think of the computer age being the dawn of the PC in the early 1980s, but of course they were around a couple of decades before that – just a lot bigger!

I must say, it’s hard to think of a better line-up of speakers. As well as high profile people like Sam Morgan, Ian Taylor and Rod Drury, there’s also a huge range of experts covering pretty much every area of computing and IT plus a BarCamp on Saturday.

The focus of the conference is on Innovation. From their website:

We as individuals, as organisations and as a country must take action, harness our creative energy and ‘no limits’ spirit to propel New Zealand forward as a leader in the digital economy, and dramatically improve our productivity. Kiwi ingenuity is needed today more than ever.

And we must celebrate what the last 50 years have brought up, and learn from them whilst looking forward to  the future.

I’m led to believe there are still some tickets left if you get in quick. Should be an excellent event, and hope to see a lot of people I know there.

Trevor being slaughted on the facts

Once upon a time Trevor Mallard used to decide policy, have a dozen personal staff, and a thousand or so bureaucrats working for him. He controlled a budget vote of around $10 billion or so.

Now he is reduced to half arsed smears on Red Alert, that get demolished by his own commenters.

Trevor’s post is headlined:

Nat party spinmeister (and Key recruiter) hired fraudster

And in the body:

Buried away to date is the fact that the recruitment agency that failed to check the CV (including the claims he designed the missile guidance systems for the UK’s nukes, bobsleighed at the Olympics inter alia) was Momentum, Headed by Michelle Boag well known to the National Party spin team and responsible for recruiting John Key into the National Party caucus.

smhead points out:

1. Boag doesn’t head Momentum.
2. Boag didn’t work at Momentum at the time Wilce was hired.
3. Wilce was hired during a Labour government.

Michelle only started work for Momentum in September 2008. Wilce was hired in 2005.

How stupid are you to claim someone hired someone, when she didn’t even start there until 30 months or so after the appointment was made? Well actually it isn’t stupid – just malicious.

The Press on Anderton

The Press editorial:

Anderton has been weakened, though, by his insistence until now that he would not quit Parliament if he won the mayoralty. He asserted that he could handle both jobs “standing on his head”. It was an assertion that did not go down well before the earthquake and has now been shown to be horribly overweening. Anderton belatedly recognised this with his announcement yesterday that he would in fact relinquish his parliamentary seat if he became mayor. But the concession was made slowly and reluctantly. He had dithered over it long enough for some voters at least to call into question his judgment and temperament for the job.

I’d forgotten that quote that he could do both jobs standing on his head. Anderton has never suffered from a lack of confidence.

Inquiry into Wilce hiring

NZPA report:

The State Service Commission will investigate how Stephen Wilce was able to be hired as the Defence Force’s top scientist without his credentials being properly checked and how he was able to obtain top level security clearance.

Prime Minister John Key, who is also the Minister in Charge of the NZ Security Intelligence Service, told Breakfast on TV One that over that weekend he had spoken to State Services Commissioner Iain Rennie who would investigate. …

Mr Key said he was not happy about what had happened.

“Which is why over the weekend I asked Iain Rennie… to conduct an investigation looking firstly at the SIS – so specifically at this issue – but at the wider issue… The bigger worry is actually that this guy had access to top level security and therefore top level information.”

A lot of people are rushing to conclude that the employment consultants must be at fault. I would not rush to judgement there. I’ve employed half a dozen senior staff or CEOs using employment consultants. As the employer, you often do the reference checks yourself, as it can give you a better idea of how the potential employee will work out, any strengths and weaknesses etc.

What will be important is to establish whether any checks were done at all, and if so by whom.

Weasel words

AAP reports:

Sir Richard Branson, the founder of Virgin Blue, has come out strongly against the decision not to allow the airline to enter an alliance with Air New Zealand on trans-Tasman routes.

Sir Richard said he wanted to compete on a level playing field but the competition regulator wasn’t making business easy.

No you didn’t want to compete. You wanted to stop competing with Air NZ – the exact opposite to competing.

Fidel up close

Jeffrey Goldberg got invited recently to meet Fidel Castro. Some fascinatign insights from his Part I and Part II articles.

Castro’s message to Mahmoud Ahmadinejad, the President of Iran, was not so abstract, however. Over the course of this first, five-hour discussion, Castro repeatedly returned to his excoriation of anti-Semitism. He criticized Ahmadinejad for denying the Holocaust and explained why the Iranian government would better serve the cause of peace by acknowledging the “unique” history of anti-Semitism and trying to understand why Israelis fear for their existence.

My goodness. Hopefully the Iranian President is listening.

He began this discussion by describing his own, first encounters with anti-Semitism, as a small boy. “I remember when I was a boy – a long time ago – when I was five or six years old and I lived in the countryside,” he said, “and I remember Good Friday. What was the atmosphere a child breathed? `Be quiet, God is dead.’ God died every year between Thursday and Saturday of Holy Week, and it made a profound impression on everyone. What happened? They would say, `The Jews killed God.’ They blamed the Jews for killing God! Do you realize this?” …

He said the Iranian government should understand the consequences of theological anti-Semitism. “This went on for maybe two thousand years,” he said. “I don’t think anyone has been slandered more than the Jews. I would say much more than the Muslims. They have been slandered much more than the Muslims because they are blamed and slandered for everything. No one blames the Muslims for anything.” The Iranian government should understand that the Jews “were expelled from their land, persecuted and mistreated all over the world, as the ones who killed God. In my judgment here’s what happened to them: Reverse selection. What’s reverse selection? Over 2,000 years they were subjected to terrible persecution and then to the pogroms. One might have assumed that they would have disappeared; I think their culture and religion kept them together as a nation.” He continued: “The Jews have lived an existence that is much harder than ours. There is nothing that compares to the Holocaust.” I asked him if he would tell Ahmadinejad what he was telling me. “I am saying this so you can communicate it,” he answered.

I never thought I would be singing the praises of Fidel Castro, but he has it dead right.

I asked him if he believed the Cuban model was still something worth exporting.

“The Cuban model doesn’t even work for us anymore,” he said.

This struck me as the mother of all Emily Litella moments. Did the leader of the Revolution just say, in essence, “Never mind”?

I asked Julia to interpret this stunning statement for me. She said, “He wasn’t rejecting the ideas of the Revolution. I took it to be an acknowledgment that under ‘the Cuban model’ the state has much too big a role in the economic life of the country.”

As China has learnt also. A lesson some MPs on the left could do with learning also.

He asked us, “Would you like to go the aquarium with me to see the dolphin show?”

I wasn’t sure I heard him correctly. (This happened a number of times during my visit). “The dolphin show?”

“The dolphins are very intelligent animals,” Castro said. …

Someone at the table mentioned that the aquarium was closed on Mondays. Fidel said, “It will be open tomorrow.”

And so it was.

Has, being dictator has some advantages!

“Goldberg,” Fidel said, “ask him questions about dolphins.”

“What kind of questions?” I asked.

“You’re a journalist, ask good questions,” he said, and then interrupted himself. “He doesn’t know much about dolphins anyway,” he said, pointing to Garcia. He’s actually a nuclear physicist.”

“You are?” I asked.

“Yes,” Garcia said, somewhat apologetically.

“Why are you running the aquarium?” I asked.

“We put him here to keep him from building nuclear bombs!” Fidel said, and then cracked-up laughing.

My God, a Fidel with a sense of humour, who decries anti-Semitism and admits the Cuban model no longer works. Almost likeable. But then I remember all the political prisoners.

A sad story

NZPA report:

The estranged parents of slain undercover policeman Don Wilkinson are locked in a bitter dispute over their son’s “slapdash” will and $2 million fortune, according to a story to be published in North and South magazine today.

Mr Wilkinson, who was fatally shot during a night-time police surveillance operation in Mangere in September 2008, left his adoptive father, Ron Wilkinson, all his assets, including a $900,000 property in Helensville, northwest of Auckland, $70,000 in cash, some investments and a six-figure payment from police insurance and superannuation, the magazine as reported by The New Zealand Herald said.

Mr Wilkinson wrote the will in 1985 before going to work in Antarctica.

At the time, his assets were two guitars and a second-hand car.

His mother Bev Lawrie said she was close to her son and he would be horrified that she was left with nothing.

One lesson is to make sure you keep your will up to date.

The Stuff version of the NZPA story misses the key aspect, merely reporting:

Under the Family Protection Act, potential claimants have 12 months after a will is probated to bring a claim.

The Herald version includes:

Lawyers say nothing can be done now. Under the Family Protection Act, potential claimants have 12 months after a will is probated to bring a claim.

But Ms Lawrie said she spent the year after her son’s death trying to survive – mourning him, weathering publicity and dealing with the killer’s arrest.

It is very sad that no one advised Ms Lawrie of the absolute importance of that 12 month deadline, as it sounds like she had an excellent chance of gaining half the estate.

Rudman on electoral fraud

Brian Rudman writes:

Just as you think the Super City elections can’t get any duller, two of the mayoral candidates engage in a shadow cock fight on a stage on the North Shore, then it’s revealed that 87 Indian-sounding voters are registered at two modest-sized Papatoetoe homes.

For all four candidates it’s a potential calamity. Unless those behind this apparent manipulation of the democratic process are unmasked before voting papers go out, a shadow of suspicion hangs over all four.

I agree, those behind this must be unmasked. If the Police talk to the 87 enrollees, I am sure a number of them will confirm who told them to register at that address, and why.

August Polls

Have just sent out the August polling newsletter, summarising the polls in NZ, Australia, US, UK and Canada. You can subscribe to the newsletter here.

Has been a lot of issues polls this month – on oil substitutes, Christchurch Mayoralty, liquor sale hours, euthanasia, local election issues, compulsory te reo Maori, the Auckland Council, land sales to foreigners, the drink driving limit, 90 day probation periods, Chris Carter & Phil Goff and the normal business and consumer confidence polls.

Anderton finally does the right thing

Stuff reports:

Christchurch mayoral candidate Jim Anderton will resign his Wigram seat if he wins next month’s election.

Anderton has just announced his new position at a press conference in Christchurch this afternoon.

Anderton has previously insisted he would stay on as an MP if elected Mayor. But he has come under pressure to change his position since the 7.1 magnitude earthquake that devastated the region last Saturday.

“The events of the last nine days have changed circumstances dramatically,” Anderton said.

I would say it exposes how flawed his original decision was.

I hope he does not change his mind after the election – if he wins. Maybe he should resign now, so there can be no doubt!

Anyway it is good that people in Christchurch can vote for whom they want as Mayor, knowing they will get someone who will be  a full time Mayor. The election should be about whether Parker or Anderton will be the better Mayor, not about whether Anderton would cling on to his parliamentary job also.

Bet tickets will be cheap for this game!

The SST reports:

POLICE will boost security for the USA’s first pool game in next year’s Rugby World Cup because it falls on the 10th anniversary of alQaeda’s deadly September 11 attacks in 2001.

Cup police operations head Superintendent Grant O’Fee said police had not been involved in the draw but were “aware of the significance of the date”, and might put in place “some different arrangements than we have for normal games”.

The pool game, against Ireland, will be played at New Plymouth’s Stadium Taranaki.

I might give that game a miss.

Seems to be a pattern

The Dom Post reports:

Hawke’s Bay millionaire merchant banker Sam Kelt has been convicted of disorderly behaviour after a court heard he performed a “flying kung-fu kick” at a passing car.

And previously:

January 1, 2004: Kelt handcuffed and pepper-sprayed after being pulled over while driving his black Mercedes-Benz from Hastings racecourse. He is charged with assaulting police, resisting arrest, refusing to accompany police and refusing to supply a blood sample. Police claimed he was aggressive. He said he had his hands in his pockets and was being friendly. Police dropped the assault and resisting arrest charges. Kelt was fined $1200 and disqualified from driving for six months. He apologised to police.

July 15, 2006: Shortly after midnight Kelt leaves a Mt Maunganui hotel he and wife Bird were staying in to ask boy racers to stop making noise. Raponi Terangikatukua Wilson, 20, admitted punching Kelt to the ground and was sentenced to 200 hours’ community work and $1000 reparation. Kelt suffered serious injury and, in an unusual move, he was represented by a lawyer, Paul Mabey QC, under the Victims Rights Act, at Wilson’s sentencing. Wilson said he had been minding his own business when Kelt began banging on his bonnet. He took this as a challenge to fight.

December 18, 2008: Kelt is involved in an altercation with the manager of Diva bar in Havelock North after a late-night row between his wife and his PA, Kerryn Jones. Kelt is charged with assault after grabbing the manager by his T-shirt. A police officer said Kelt was drunk and abusive. Kelt said he was sober. He was discharged without conviction in Hastings District Court last June.

Seems to be a pattern here. I wonder if someone who was not a millionaire might be in jail by now for all these offences?

UPDATE: Several people have posted on all the good stuff Sam Kelt has done. That’s all well and good, but it seems very obvious to an outsider that he has an anger problem, and if he doesn’t do something about it he’ll keep ending up in trouble with the law.

Four seeking Mana nomination

NZPA report:

The four Labour candidates competing for candidacy in the Mana by-election have been named and party president Andrew Little is predicting a close contest.

Press secretary and former television reporter Kris Faafoi, Vehicle Testing New Zealand business manager Michael Evans, criminal defence barrister Peter Foster and communications consultant Josie Pagani have been nominated.

A close contest? Personally I’d be putting money on the guy who already has his campaign website address registered, plus who has a replacement for his current job lined up.

Obama aide on Key

The Herald reports:

A senior member of the Obama Administration has praised the Prime Minister as a “key player” on the international stage, who has developed a “real chemistry” with the US President. …

Speaking at a seminar on United States-New Zealand relations in Washington, Dr Campbell said Mr Key had “animated the discussions” and “drove the deliberations” at the President’s Nuclear Summit in April.

Labour, and many in the wider left, have been underestimating John Key for years and years, and still do so. This is partly why they lost the 2008 election – they were convinced Clark would destroy Key in the debates.

Even today they have their fantasies that he is some sort of smile and wave lightweight, whose only asset is his smile. And you compare that to Campbell’s assessment that Key drove deliberations at the US convened nuclear summit.

Dr Campbell said the Obama Administration had at first considered the US-NZ relationship was “profoundly underperforming”.

The change of regime in both counties has probably helped 🙂

Armstrong on Earthquake response

John Armstrong writes:

The Prime Minister would be less than human if he wasn’t disappointed at having to cancel his weekend engagement as the Queen’s guest at Balmoral Castle, the royal family’s residence in Scotland.

Such an invitation to a New Zealand prime minister is unprecedented and shows the degree of rapport John Key has with the head of state.

I had also heard that indeed the PM and the Queen has developed a strong rapport. While I am a republican, I am also a big fan of the Queen’s integrity and sense of service – and like the idea that our Head of Government and Head of State get on very well.

This was the psyche of the one-time foreign exchange dealer prepared to take a calculated risk. Except in this case any benefit accruing from hob-nobbing with royalty would have been largely personal. And those pluses would have been totally outweighed by the minuses Key would have notched up back home.

I agree it would have been a very bad look to go ahead.

So far, National’s response to the crisis has been largely exemplary and criticism-free. The Government has been relentlessly single-minded in focusing on providing and co-ordinating a recovery strategy for Christchurch. It has driven the public service to the limit in getting that strategy implemented.

High praise.

If anyone needs convincing that Christchurch is a city on edge, they need only replay Wednesday’s speech in Parliament by National backbencher Amy Adams.

The MP, whose Selwyn electorate encircles part of Christchurch, came closer than anyone so far in capturing the horror of last Saturday’s quake and the psychological anguish felt by many in the after shock-filled aftermath.

I blogged it yesterday. It really made it real for those of us lucky enough to be unaffected.

This is a climate which does not look kindly at penny-pinching by the state. The country is expecting generosity for those who have suffered. Saturday’s earthquake has loosened National’s purse strings.

Twice in two weeks – the first being the payout to depositors in South Canterbury Finance – Finance Minister Bill English has had to explain why the Government’s books are still “manageable” when he previously argued there was no room for more spending.

National would argue the extra spending is a matter of necessity, not choice. But it has undermined English’s pleas for restraint elsewhere, while making it harder for him to find the money for election-motivated giveaways in next year’s Budget.

I disagree. I think the spending on SCF and the earthquake makes it harder for people to argue extra spending elsewhere. Teachers look petty striking for free laptops, when the Government is spending its very limited funds on rebuilding Christchurch.

Electoral fraud in Papatoetoe

The Herald reports:

Police are investigating a possible attempt to influence the Super City election in which nearly 90 voters have been enrolled as living in two houses.

The Weekend Herald can reveal 48 voters are listed as living in one Papatoetoe home and 39 are enrolled as living in another property in the same South Auckland suburb.

This is an old trick in the more southern parts of Auckland, and has been exposed in the past through electoral petitions. I have no knowledge of the specifics in this case, but the electoral petitions in the past have shown this to be an exclusive Labour party activity.

Daljit Singh said Labour was not asking people to falsely enrol in the area to vote for him, and described rumours suggesting this was happening as part of a smear campaign.

He said several local Sikhs had told him C&R members had encouraged them to sign up in Papatoetoe, despite living elsewhere, and to mention Mr Singh’s name to arouse suspicion.

Mr Singh should get affidavits from these local Sikhs, and make sure they include the names of these alleged C&R members who said to sign up, and mention his name. If he is not willing to do this, well it makes you wonder that he is so quick to explain why his name is linked to this electoral fraud.

Daljit Singh believed some families from outside Papatoetoe could have mistakenly listed themselves as living with relatives inside the board boundaries, because their English was poor.

Goodness, for something which is nothing at all to do with him, he does have many theories about why it may have happened.

Of the 48 people listed at the Puhinui Rd address, 45 have Sikh surnames.

Owner Baljit Kaur said eight people lived at the home. She planned to vote for Daljit Singh and said her family and friends would probably also vote for him.

What a coincidence.

Electoral Enrolment Centre national manager Murray Wicks said it was possible for a large number of people to be mistakenly listed at the same address if enrolment details were not updated.

“However, we believe there are some irregularities, particularly in the Papatoetoe area,” he said.

“We have objected in writing to the individuals concerned, regarding their eligibility to be enrolled there.

“We’ve challenged the people involved and we’ll see where that leads us.”

If the voters could not prove they lived at the listed address, they would be removed from the electoral roll.

Asked if the irregularities seemed aimed at influencing the election of candidates to the Papatoetoe board, Mr Wicks said: “We don’t know at this stage. We have informed the police and they are undertaking an investigation as well.”

Well done to the Electoral Enrolment Centre for their vigilance. No matter who is behind this, I want them exposed and prosecuted. Sure it is unlikely that 100 extra enrolments will make a major difference, but there is no amount of electoral fraud which is tolerable.

Whoops

Am in Melbourne, and we are sharing a two bedroom apartment. As all good mates do, we routinely greet each other with terms of affection such as f***wit, c**t etc.

Yesterday I had headed back early, and was alone. Heard someone opening the door (they did not knock) so assumed it was the ginga and as the door opened yelled out “F*** Off C***”.

The hotel staffer asks if this is an inconvenient time to check the mini-bar, as I profusely apologise and explain my comments were not meant to be directed at him!

Imperator Fish on South Canterbury Finance

Imperator Fish is a lawyer. He leans to the left, but has always been a fair critic.

He has gone through all legal deeds about South Canterbury Finance, which were posted on Red Alert. Trevor Mallard has shown his legal skills are as excellent as his diplomatic skills and concluded it is all Bill English’s fault, and Bill has cost the taxpayer $300 million.

If you wish to take your legal advice from Trevor, then can I suggest you hire him to negotiate your purchase of the Auckland Harbour Bridge, which I have exclusive sale rights to.

Here is what Imperator Fish has found and concluded:

The Crown unquestionably had a legal obligation to pay out New Zealand depositors. This is unarguable. When SCF went into receivership, Bill English had no choice but to write out a cheque. Had he not done so the Crown would have been sued en masse by investors, and would have lost and been ordered to pay costs. The same business commentators now savaging Bill English for paying out investors would then be calling him a fool.

Including Trevor no doubt.

Some in the media and blogosphere have suggested the terms of the guarantee deeds may have been breached, and that this meant payment didn’t need to be made. Some go on to say that the fact payment was made proves this is just National looking after its mates. Wrong. It’s quite possible that breaches of the deeds occurred and should have been detected, and that the detection of such breaches may have enabled action to be taken to limit the Crown’s liability. But prior breaches do not affect the Crown’s liability to pay.

Important to note.

There was no obligation to pay overseas investors, as Bill English has himself admitted. He has said paying them out enables the Crown to take control of the receivership. It may seem unfair that some people are getting the benefit of a guarantee not designed for them, but the alternative is to risk getting much less during the receivership. English’s position on this matter is at least defensible, and may in fact be financially prudent.

One may have ended up with years of litigation, if some investors were excluded. An extra $20 million, to gain full control seemed worth doing.

SCF had a number of obligations under the deeds, including the obligation to conduct its business and operations in a proper, businesslike, efficient and prudent manner, and the obligation not to engage in related-party transactions. Any breach by SCF of those obligations would give the Crown the right to withdraw the guarantee in relation to future deposits only.

This is what many people do not realise. Once the guarantee is in place, you can’t punish the investors for the sins of the company.

IF does want an inquiry though:

I stand by the move to pay New Zealand depositors, because legally any other position would have been utterly indefensible. The decision to pay overseas depositors can at least be debated, though I understand the reasoning behind the move.

But questions remain about the role of Treasury and others in this. Could SCF’s troubles have been detected earlier? Could the Government have avoided paying out some of this money?

This needs a public enquiry. A huge amount of money has been paid out, and the decisions of those involved should be scrutinised. If it turns out they have acted entirely properly, then they will have nothing to fear.
I am not against an inquiry, but I think it is too early for it now. The SFO is still investigating Aoraki, and the Statutory Managers are also sorting through things. Possibly once both those entities have concluded their inquiries, then one can look at whether we would benefit from an inquiry into everything.