The Commission launches its investigation

After months of mounting pressure Nanaia Mahuta yields to calls for the Public Service Commission to launch an investigation into her family's business dealings with Government.

Photo by Sulthan Auliya on Unsplash

In my very first tweet regarding Nanaia Mahuta on 2 May, I began by commenting on the fact that whilst people joke about New Zealand being small, we are in fact so small that the Minister needed to appoint her sister to a key role. So it’s been no surprise that as pressure has mounted on the Government one of their go-to defenses has been just that observation. Indeed yesterday during her stand-up with the parliamentary press, Minister Mahuta remarked that in New Zealand there are only 2 degrees of separation but for Maori it is just 1 degree. That obviously overstates the reality but in any event the public is broadly aware that there are a multitude of overlapping professional and personal relationships within Government and that conflicts will therefore inevitably arise.

The key point, as made by Minister Hipkins yesterday, is how those conflicts were managed and that is what the Public Service Commissioner will investigate in four of the Mahuta contracts - being those with the Departments of Conservation, Environment, Housing and Maori Development. What the Commissioner will find is a wildly variable range of approaches with only one common factor - they all failed. The Commissioner will need to ascertain, as best he can, whether the current policies are fit-for-purpose and why there was such a poor record of compliance. The Ministry for the Environment has only just finished its own internal review and what that report demonstrated was that the failures were not simply limited to the management of conflicts. They therefore necessitated a range of policy updates to address those deficiencies. I suspect that a version of those recommendations will need to be rolled out across Government.

That will be a very important reform because a critical failure that has exacerbated this situation for the Government has been that no-one, or no one agency, had a complete picture of the number of contracts that were being entered into by the Minister’s family. If a ministry identified a conflict, it only assessed it by reference to that ministry and not from a whole-of-Government perspective - this meant that each conflict could be assessed in isolation as relatively low risk, whereas if each ministry had known of the existence of the other contracts, it would have had a far more accurate picture of the growing appearance risk. Government has therefore been blindsided. One or two contracts could be considered ‘normal course of business’ but when the number grew to four or more the risk started to become unmanageable.

The Commissioner’s current assessment is that he does not think that this matter reaches the threshold for an inquiry using his powers under the Public Service Act. That assessment may change as he fully gets to grips with the issues. For the moment the investigation is limited to the administrative conduct of the four aforementioned ministries. The appointment of Tipa Mahuta to the Chair of the Maori Advisory Group of Taumata Arowai (the national water regulator) and the appointment of another family member to the working group that authored He Puapua are not (yet) included. There are good reasons for including these additional items in the review if it is to be considered final and conclusive - they involve the same people during the same time period and involve some of the same issues (albeit each with its own factual matrix to consider). No doubt there will be resistance to this suggestion as broadening the review could touch upon other controversial appointment processes such as those relating to Rodger Findlay and Matthew Tukaki and it could come closer to directly implicating Minister Mahuta in wrongdoing.

In addition, the Auditor General is said to be considering whether to open an investigation and I think there are good grounds for him to do so. The inconsistencies that Minister Mahuta referred to yesterday cover a range of issues regulated by the Government Procurement Rules and it therefore seems sensible that the AG conducts some sort of audit to complement the work undertaken by Peter Hughes. The final result should be an update to the Cabinet Manual, Procurement Rules and ministry policies which promotes and protects New Zealand’s reputation as a country with high standards of conduct across Government.