Ardern, Robertson in precarious positions

Labour Party president Nigel Haworth resigned yesterday over the mishandling of bullying and sexual assault allegations, but pressure continues to build on Jacinda Ardern and the spotlight is now also shining on Grant Robertson.

In his brief resignation statement Haworth didn’t take any responsibility for his mishandling of two serious issues (the summer camp assaults and the staffer allegations, and there was no apology either.

Ardern did apologise in her statement and in standup interviews. From Jacinda Ardern accepts Labour Party President resignation:

“In the last 48 hours I have read incredibly distressing reports of an alleged sexual assault involving members of the Labour Party,” Jacinda Ardern said.

“This morning I was provided some of the correspondence from complainants written to the party several months ago. It confirms that the allegations made were extremely serious, that the process caused complainants additional distress, and that ultimately, in my view, the party was never equipped to appropriately deal with the issue.

“I discussed the correspondence with the Labour Party President this morning. Whilst he stands by the statements he has made on this matter I believe mistakes were made.

“Raising an allegation of sexual assault is an incredibly difficult thing to do; for additional distress to be caused through the way those allegations are handled is incredibly upsetting. On behalf of the Labour Party I apologise to the complainants for the way this matter has been dealt with.

But this must just be a beginning in properly dealing with this.

In question time in Parliament yesterday Paula Bennett had a short exchange with Ardern, which concluded with this question and answer:

Hon Paula Bennett: Does she stand by her previous statements that victims should go to one of their line managers and that no senior people in her office had received a complaint?

Rt Hon JACINDA ARDERN: At the time that I made the statement, yes.

That seems to have been a setup that could be a problem for Ardern. Bennett seems to have used a common trap

Shortly after in a speech in General Debate Bennett said:

I have been told by the complainants that Jacinda Ardern’s former chief of staff Mike Monroe knew about the allegations, her chief press secretary, Andrew Campbell, knew about the allegations, and the director of her leader’s office, Rob Salmond, knew about the allegations. I have been told by two victims who work in Parliament that they went to Rob Salmond around Christmas time and made a complaint about the alleged perpetrator.

The Prime Minister has constantly said her office did not receive complaints and, in fact, encouraged the victims to speak to their line managers. They did. They have told me they went to Rob Salmond and nothing was done, and we are expected to believe that none of these men in her own office told the Prime Minister about the allegations—all of this in the aftermath of the Labour summer camp scandal, when the Prime Minister made it very clear she expected to have been told.

And are we really expected to believe that she didn’t know that her chief press secretary, Andrew Campbell, embarked on a witch-hunt to try and find out who in the Beehive was talking to the media about the allegations? The complainants certainly felt hunted and scared that he was trying to shut them up and stop them from talking to the media—classic bullying of victims, and hardly a victim-led response.

Ardern doesn’t usually attend Parliament on Thursdays but may be advised to amend her answer, or claim she misinterpreted the question. Otherwise this is likely to come up next week in Parliament.

And Ardern has more questions to answer about what she knew, and when.

Newsroom: More answers needed as Labour president departs

This is far from the end of the matter, however. Using the protection of parliamentary privilege, Bennett named several senior members of Ardern’s office who she says knew about the nature of the allegations as far back as last Christmas.

We do not yet know whether that is true (a spokeswoman for Ardern said her office had no comment to make) but it is clear that the review of Labour’s processes will almost certainly uncover a few more skeletons.

Some potential findings – that some of Ardern’s staff did know but deliberately kept her out of the loop in the interests of plausible deniability, or that Ardern did know and has been economical with the truth – would almost certainly lead to more resignations.

Even if Ardern did not know that sexual assault claims had been made, some may question why she did not more forcefully ask her party to look back over its records, given the repeated claims made by complainants through the media.

And Bennett also named Grant Robertson as complicit.

A victim has told me that the alleged perpetrator has deep alliances to Grant Robertson, that he was involved in his campaign for the Labour Party leadership, and that Grant Robertson has known the seriousness of these allegations. It is unbelievable that he hasn’t discussed this with his close friend and his leader.

Robertson is not answering questions, claiming he needs to wait for the outcome of the QC inquiry that hasn’t begun yet. Burying difficult issues in an inquiry is a well worn political tactic, but I think in this case it could be more damaging rather than burying. Things will keep coming out. And they are today.

Andrea Vance (Stuff): Labour Party president Nigel Haworth has resigned – but it’s not over

Labour will be hoping party president Nigel Haworth’s exit will cauterise the wounds. It’s political management 101: feed the media a scalp and they will move on.

But it is not yet time to draw a line under the bullying, intimidation and assault allegations that currently shame the party. There are too many unanswered questions.

Ardern and the party must now be upfront about how much they knew about these allegations, and exactly when.

It’s important for a few reasons. Firstly, so that the public can be sure that senior figures did not shield this staffer.

His identity cannot be disclosed, but he held positions of influence within the party and then through his job, with the Labour Leader’s Office at Parliament.

There are other connections – which cannot be detailed for legal reasons – but mean he held more sway than an average volunteer or apparatchik.

It is one of the reasons why the complainants were so reluctant to come forward with their stories in the first place.

One of them told Stuff:  “Abuse only happens in a vacuum, it thrives in silence. And that’s the case here. For years he was able to bully and intimidate women and have relationships with women where he was abusive.

“That was reasonably well known and yet he was still given opportunities within the party. Despite his reputation, he kept on going up the ladder.”

The party needs to explain how that perception was allowed to take root among those young people.

We need to know precisely when senior ministers – including Grant Robertson and Jacinda Ardern (or their staff, because they are one in the same) were informed of the allegations. And what they did about it.

Did Ardern ever ask for a copy of Labour’s internal investigation, or the subsequent review? Why not?

Ardern says she didn’t know the allegations were sexual until this week. That’s hard to swallow.

An email sent to media outlets and others on July 12 very explicitly references allegations of extreme sexual violence. The first media reporting of the scandal, on August 5, details that some of the complaints were of sexual harassment and sexual assault. Is she saying that she wasn’t aware of these?

For the same reasons, it’s hard to accept that senior figures within the Labour party machinery had no inkling of concern about this man’s behaviour. The complainants say they flagged it with a number of senior figures going back as far as 2017 (one woman counted that she had raised concerns on eight separate occasions).

The branch that he was involved with is one of the party’s more influential, and its members certainly hold more access and sway with MPs and officials than others.

Was the party really blind to these allegations?

And then there is the shambolic internal investigation. Haworth has carried the can, but the decisions were not his alone.

The party’s ruling council decided the process. Why did they believe an internal inquiry, with no expert guidance, was appropriate?

Did the investigation panel ignore the more serious allegations of sexual assault, or not take them seriously?

Who decided the Labour staffer could bring his lawyer, when the complainants were denied legal representation?

And why were the complainants denied the right to see the final report? They have never had an explanation as to why their stories weren’t believed.

Ardern said on Wednesday: “It is my job to make that right.”

She and the party can start by being absolutely transparent with the public about these shocking events. Otherwise, abuse continues to thrive in silence.

Ardern has a big and urgent job to be seen to make this right. And I don’t think Robertson can keep hiding his involvement behind the next inquiry.

Paula Bennett speech on PM’s office involvement in assault claims

GENERAL DEBATE

Hon PAULA BENNETT (Deputy Leader—National): Thank you, Mr Speaker. I move, That the House take note of miscellaneous business.

The Prime Minister says she did not know there were sexual assault allegations against one of her staff members until Monday. I could go through the various media reports since 5 August and my own representation since being contacted by victims to show the inconsistencies in this, but they have already been well traversed in the last 24 hours.

Back in 2016, Jacinda Ardern wrote an op-ed about the scandal surrounding the Chiefs rugby team. She said that a resignation is not enough: “It’s the PR quick fix—usher the source of the controversy away. But that solves nothing. After all, apologies followed by silence changes nothing, and change is what we need.”

The resignation today of Nigel Haworth cannot be, in the Prime Minister’s words, “the PR quick fix—usher the source of the controversy away.” Yes, Mr Haworth needed to go, and it should have happened weeks ago, but what is also known is that the Prime Minister’s own senior staff and a senior Minister have known the seriousness of the allegations but have not acted.

The complainants were members of the Labour Party. They genuinely believed that the party would listen to their complaints and deal with the alleged offender appropriately, but nothing happened. It clearly has taken an incredible sense of frustration, disappointment, and disillusion for these people to come to me, a National Party MP, to try and see their complaints addressed.

These are serious allegations. The Prime Minister cannot keep her head in the sand and pretend like it is happening somewhere far, far away. It is happening in her own office, in her own organisation. She is the leader of the Labour Party. The alleged perpetrator works in her leader’s office—he works for her.

Less than a year ago, the Prime Minister was in New York at the UN, trumpeting “Me too should be we too.” Well, who knew that that meant her own office was following the path well trod by all those companies who drew a curtain over sexual misconduct and inappropriate behaviour.

I have been told by the complainants that Jacinda Ardern’s former chief of staff Mike Monroe knew about the allegations, her chief press secretary, Andrew Campbell, knew about the allegations, and the director of her leader’s office, Rob Salmond, knew about the allegations. I have been told by two victims who work in Parliament that they went to Rob Salmond around Christmas time and made a complaint about the alleged perpetrator.

The Prime Minister has constantly said her office did not receive complaints and, in fact, encouraged the victims to speak to their line managers. They did. They have told me they went to Rob Salmond and nothing was done, and we are expected to believe that none of these men in her own office told the Prime Minister about the allegations—all of this in the aftermath of the Labour summer camp scandal, when the Prime Minister made it very clear she expected to have been told. And are we really expected to believe that she didn’t know that her chief press secretary, Andrew Campbell, embarked on a witch-hunt to try and find out who in the Beehive was talking to the media about the allegations? The complainants certainly felt hunted and scared that he was trying to shut them up and stop them from talking to the media—classic bullying of victims, and hardly a victim-led response.

A victim has told me that the alleged perpetrator has deep alliances to Grant Robertson, that he was involved in his campaign for the Labour Party leadership, and that Grant Robertson has known the seriousness of these allegations. It is unbelievable that he hasn’t discussed this with his close friend and his leader.

This all smacks of a cover-up. This goes straight to the top: to the Prime Minister, to senior Cabinet Ministers, and—

SPEAKER: Order! The member’s time has expired.

https://www.parliament.nz/en/pb/hansard-debates/rhr/document/HansS_20190911_053250000/bennett-paula-mallard-trevor


Possible of note is in Question time just before this Bennett briefly questioned Ardern.

2. Hon PAULA BENNETT (Deputy Leader—National) to the Prime Minister: Does she stand by all her statements?

Rt Hon JACINDA ARDERN (Prime Minister): Yes.

Hon Paula Bennett: Does she agree with the statement made by Jacinda Ardern in 2016 about the Chiefs rugby scandal that a resignation is not enough: “It’s the PR quick fix—usher the source of the controversy away. But that solves nothing. … After all, apologies followed by silence changes nothing, and change is what we need.”?

SPEAKER: No. That question does not relate to a statement of the Prime Minister.

Hon Paula Bennett: Does she stand by her statement in the House yesterday that “we need to make sure that we have environments in all of our workplaces that meet the expectations of alleged victims, and that respond to those situations.”, and how does that correlate with a situation where the victims were barred from parts of the parliamentary complex?

Rt Hon JACINDA ARDERN: Yes.

Hon Paula Bennett: Does she stand by her statement in the House yesterday that “we need to make sure that we have environments in all our workplaces that meet the expectations of alleged victims,”; and, if so, how does that correlate that senior male staffers in her office have known about these extremely serious allegations since at least the beginning of the year and none of these men have brought it to her attention?

Rt Hon JACINDA ARDERN: Again, to answer the first part of the question, yes.

Hon Paula Bennett: Will she be revising her statement made to the UN less than a year ago that “#MeToo must become we too. We are all in this together.”, in light of her own office’s failure to deal with sexual assault allegations involving one of her staff members?

Rt Hon JACINDA ARDERN: No.

Hon Paula Bennett: Does she stand by her previous statements that victims should go to one of their line managers and that no senior people in her office had received a complaint?

Rt Hon JACINDA ARDERN: At the time that I made the statement, yes.

If Ardern “made the statement” after two complainants went to a line manger (Salmond) around Christmas time she could have a probem.

Credibility of Ardern, Haworth and Labour increasingly shaky over sexual assault claims

A follow up up on yesterday’s post Labour’s ongoing bungling of dealing with assaults within the party – the reputation of the Labour Party and the credibility of the party president Nigel, and increasingly the leader Jacinda Ardern, are on the line as the bullying and sexual assault claims grow in strength as more people and information comes out in the media.

The Spinoff: Timeline: Everything we know about the Labour staffer misconduct inquiry

Jacinda Ardern has declared herself “deeply concerned and incredibly frustrated” over the allegations levelled at a Labour staffer as well as the party investigation into the man, who remains employed by the Labour leader’s office and denies wrongdoing.

The party president says he is “confident I have handled the process in a professional manner”.

The prime minister says she had been assured that no complainant alleged sexual assault or violence. She says the first she learned of the nature of the allegations that Sarah (a pseudonym) insists she raised repeatedly with the Labour Party, was upon reading the Spinoff’s investigation published on Monday.

A crucial question is whether the Labour Party’s position, that it was not informed of the allegations, is tenable. Just as important is whether its process – for example in repeatedly failing to meet complainants’ requests to review the summaries of their oral evidence – is defensible.

They then detail “an incomplete chronology” based on public statements and numerous documents provided to The Spinoff. This collates much of what has been made known already, but includes corroboration of the authenticity of an Open Letter to Ardern:

An “open letter to the prime minister” is circulated within the party by “Me Too Labour”, an unnamed “group of Labour Party members who are writing to you to urge you to immediately take action regarding the allegations” surrounding the staffer. It makes a series of demands including the resignation of Haworth. The letter, which The Spinoff has verified originates from party members, had by lunchtime attracted more than 100 signatures.

From the open letter:

Dear Prime Minister,

We are a group of Labour Party members who are writing to you to urge you to immediately take action regarding the allegations of repeated sexual assaults, harassment and predatory behaviour of one of your staff, who is a member of the Labour Party, as detailed in these stories:

https://thespinoff.co.nz/unsponsored/09-09-2019/a-labour-volunteer-alleged-violent-sexual-assault-by-a-senior-staffer-this-is-her-story/?fbclid=IwAR2w3BYBKCccR_hDGB-qNqohdFcXnS157NsZLbBj1yVrjl9M6mBscbQjuRo

https://www.stuff.co.nz/national/politics/115592299/young-labour-abuse-victims-barred-from-parliament-offices

https://www.newshub.co.nz/home/politics/2019/08/exclusive-labour-forced-to-review-investigation-into-bullying-sexual-assault-allegations-against-staffer.html

Some of us are the survivors. Others are their friends and supporters. All of us have watched in horror as this story has unfolded, as the survivors have been repeatedly re-traumatised, and as the Labour Party has run a shambles of a process that has enabled an alleged attacker and shut out his survivors. This issue has been discussed for too long in secret meetings and private conversations, and it is our hope that by drawing attention to it in the light of day we will get the action that the survivors deserve. We are sending this letter to the Labour Party caucus, the entirety of the New Zealand Council of the Labour Party, and to all Labour Party LECs.

What has been outlined in the stories is nothing short of sexual assault. What has been outlined as the party’s process in addressing this assault is nothing short of enabling.

It has been claimed that this letter is a ‘false flag’, part of a conspiracy and attempts have been made to discredit it at The Standard.

Stuff: Complaints about Labour Party staffer taken to his employer

Two of the complainants in an investigation into assault, bullying and harassment by a Labour Party staffer have taken their concerns directly to the man’s employer.

The man, who Stuff cannot name for legal reasons, works in the Labour Leader’s Office, but is a public servant employed by Parliamentary Service.

A 19-year-old woman, who alleges sexual assault, and a young man, who has accused the staffer of throwing a punch at him, wrote to Parliamentary Service boss Rafael Gonzalez-Montero on Tuesday.

But Gonzelez-Montero says his hands are tied because the accusations do not relate to the man’s employment. Neither of the complainants work at Parliament.

It’s hard to understand why this can be deemed not an employment matter.

The man has not been stood down. But he agreed to work from home after allegations surfaced about his conduct in early August.

The issue has a direct effect on the man’s employment.

It is also hard to understand why Ardern is allowing this man to continue to work for her office in the current situation. It could drag her and her Government down.

HDPA (Newstalk ZB): We must question PM’s honesty over Labour sexual assault allegations:

This is what we want to ask her: When did she know that the allegations against a staffer in her office were of an alleged sex crime?

She told media yesterday: ”I was informed in the very beginning that the allegations made were not sexual.”

She told RNZ this morning that she found out yesterday.

“The first I’ve seen the complaints of that nature was when I read then.” Asked when that was, she said “When I saw them in the Spinoff.”

That is very hard to believe. This has been reported in the media for the last five weeks.

If you believe that yesterday was the first the Prime Minister heard of this, then you must believe that the Prime Minister of this country does not watch, read or listen to the news reported in this country.

That she for the last five weeks has missed every bulletin, newspaper and programme that mentioned the fact this guy is alleged to have committed a sexual crime.

Like this on Newshub: “The Labour Party has been forced to review its own investigation into bullying, sexual harassment and sexual assault by a Labour staffer.”

Or this: “Two more of the seven people who laid complaints about bullying, sexual harassment and assault by a Labour staffer have told Newshub about their experience of the department’s internal investigation.”

You have to also believe that the Prime Minister didn’t ask what allegation was so serious that a staffer in her office stopped coming to work five weeks ago.

You also have to square it with this comment she made yesterday in her press conference”:

“A month ago I visited New Zealand [Labour Party] Council. Very seriously shared my view that they were not the appropriate place to undertake inquiries around concerning behaviour of members of the Labour Party. But particularly they are not the appropriate place to ever undertake an investigation into a sexual assault. And that would be their view too.”

Why would she say to the Labour Party council that they were not the right people to investigate an alleged sex crime, if she didn’t know the allegations were of a sex crime?

Because she did. She did know.

On the 6th of August, one day after the story broke in the media, Mike Hosking raised it with her right here on this station.

He asked her: “How many people have quit your party as a result of this investigation into this bloke who may or may not have sexual assaulted someone?”

Her response was: “I’m going to be very careful answering that question Mike because this is an inquiry and work is still underway and it is still a party matter.”

Exactly when the Prime Minister knew is important for a bunch of reasons.

Did she fail in her duty of care to staffers and volunteers?  Was this supposed to be covered up? But mostly it’s important because this is now about her integrity

It’s becoming increasingly hard to believe her version of events, and possibly this is the first time that we’ve had reason to question Jacinda Ardern’s honesty.

This is not just Ardern’s honesty and credibility at stake. Labour’s chances in the next election may be severely compromised by this.

It has been claimed that the man facing the allegations is seen by Labour as an important part of their campaign team. He may be more toxic than helpful. It’s hard to understand why Ardern can’t see this. Perhaps she is (or has been)too close to the accused person.

Grant Robertson also seems to be involved in this, and may have been trying to distance Ardern from the growing issue.

Newshub: Emails show Labour was sent details of sexual assault allegations against party staffer

Newshub has obtained emails that show Labour was sent details six months ago of sexual assault allegations against a party staffer.

The party continues to deny it knew the claims against the man included sexual assault, but on Tuesday the Prime Minister said the party President Nigel Haworth has to go if it’s proven he mishandled the allegations.

Newshub has been forwarded an email sent by a complainant to one the members of the Labour Party investigating panel on the day of her interview.

She wanted to be able to read off a timeline and testimony. She asked if someone could print the document before her interview which was taking place an hour later.

A document “to print sexual assault experience” was attached.

Prime Minister Jacinda Ardern was shown the document on Tuesday morning.

She told Newshub, “You’ll understand why we will want to take away this and look at it directly.”

Labour agrees the email was sent but claims there were no documents attached. The complainant says all three members of the investigating panel were given a printed copy.

Newshub revealed in August Finance Minister Grant Robertson was aware of the investigation and some complaints, but he’s refusing to say how much he knew.

“I am not going to comment any further than what I have on that because I will be undermining the privacy,” he told Newshub.

In an interview on RNZ’s Checkpoint yesterday a man who claims to be the victim of an attempted physical assault and a physical assault indicated the accused man had family connections to the Labour Party.

Protecting him looks increasingly untenable.


And more just posted at The Spinoff: Fresh evidence emerges confirming Labour was told of sexual assault allegations on June 11

The woman who alleges sexual assault by a man currently employed by the Labour Leader’s office has expressed dismay at the response of the Labour Party president, Nigel Howarth, who yesterday issued a public statement doubling down on his position that sexual assault allegations contained in investigation published by The Spinoff were never made known to anyone involved in the Labour inquiry.

“He was like a fatherly figure to these six women, and he’s let us down,” she told The Spinoff.

Her comments come as a second email has newly emerged which shows Sarah, the pseudonym by which she is described in The Spinoff’s story, sending a written account of sexual abuse allegations to the Labour Party.

In the email, dated June 11 and sent to the three members of the investigation panel, she directs them to an attached document which contains clear reference to her allegation of being sexually assaulted by the man.

This is on top of another email, sent on the morning of her interview to the chair of the panel, requesting that attached documents be printed. He asked her to send it on to the party official who was overseeing access to Labour headquarters, which she did. According to Sarah four copies of those documents were printed and provided to the panel.

The Labour Party has told The Spinoff that no attachments were received by the investigation chair, and that no one involved in the investigation was aware that any of the people appearing before them was alleging sexual assault.

Sarah told The Spinoff yesterday she was “disappointed” by what she regarded as a “cowardly” statements on the part of the Labour Party. She maintained that her traumatic experience, as detailed Monday on The Spinoff, was first described to Labour at a meeting in October 2018 with Nigel Haworth and general secretary Dianna Lacy. She said this was reiterated to the investigating sub-committee in March 2019.

“We’ve had so many email exchanges that talk about the nature of the investigation,” she said. ““I’m incredibly saddened … Standing by a process you know is flawed, a process you know retraumatised and put further young women at risk is cowardly.”

 

Rainbow Wellbeing Legacy Fund

Government establishes Rainbow Wellbeing Legacy Fund

Improving the mental health and wellbeing of young members of the rainbow community is at the heart of the establishment of the Rainbow Wellbeing Legacy Fund, Prime Minister Jacinda Ardern said today.

The Fund is an acknowledgement of those New Zealanders who were convicted for homosexual acts before the law was changed in 1986. In 2017 the Government apologised to them and in 2018 passed a law to allow for convictions to be expunged.

“In the wake of this the suggestion was made by some of the men involved that a fitting legacy would be to establish a fund that supports the young people of the Rainbow community. That is exactly what this fund will do.” Grant Robertson, Minister of Finance said.

“This is a community proposed and driven idea that has come from one part of the community for another and the Government is proud to make it happen,” Jacinda Ardern said.

“The Government is proposing to establish a charitable trust with a one-off endowment of $1 million. The trust will administer the payment of annual grants to support organisations that improve mental health and wellbeing outcomes in New Zealand rainbow communities, with a particular focus on organisations that support young people.

“The Government takes mental health seriously and this fund helps to tackle one of New Zealand’s long-term challenges of mental health,” Jacinda Ardern said.

A million dollars is a very small part of the budget (compared for example to the $1 billion a year Shane Jones political wellbeing fund). It should be money well spent.

 

 

Bridges claims ‘deceit and dirty politics’ – but who did the dirty?

Simon Bridges and National continue to go hard out on the leak of budget information two days before Budget day.

But who is playing dirty here?

RNZ Week in politics: National set the trap and Robertson walked into it

National used the information it found on Treasury’s website to set a trap – and it worked far more effectively than Simon Bridges could have imagined after Gabriel Makhlouf made his “we have been hacked” announcement.

Finance Minister Grant Robertson walked into a trap set by National when he linked the Budget “leak” to illegal hacking.

It was no such thing, and National had known it all along. A simple website search had given the Opposition details of some of the spending in yesterday’s Budget.

At the same time, Mr Bridges was giving a hand-on-heart assurance that National had acted “entirely appropriately” while refusing to say how it had obtained the information.

At that point, National had probably expected the usual response to a leak – condemnation of such behaviour and the announcement of an inquiry.

What it could not have expected was Treasury Secretary Gabriel Makhlouf dramatically announcing that his department’s website had been systematically hacked, and that he had called in the police on the advice of the GCSB.

That was a game-changer, and Mr Robertson seized it. “We have contacted the National Party tonight to request that they do not release any further material, given that the Treasury said they have sufficient evidence that indicates the material is a result of a systematic hack and is now subject to a police investigation,” he said.

The implication was obvious – National had either hacked the website or received the information from someone who had. Whoever did it, their actions were illegal.

It turns out what National did wasn’t illegal – but I still think it was highly questionable. They were trying to do a dirty on the Government to grandstand prior to the budget going public.

Mr Bridges raged about unjust smears on his party and accused Mr Makhlouf and Mr Robertson of lying. The Treasury secretary’s position was untenable and Mr Robertson should resign.

He claimed Treasury had quickly discovered the huge chink in its security and had “sat on a lie” while his party was being accused of criminal behaviour.

This leaves some very big questions which have not yet been answered. If Treasury’s IT people knew what had happened, why did Mr Makhlouf go public with his hacking announcement?

Was he misled by his own department, by someone who didn’t want it known that a blunder had been made with the uploading? That’s hard to believe, because it must have been realised that National was going to blow the whistle on the website search.

Did Mr Makhlouf make the decision to call in the police on his own? Mr Robertson says he didn’t know until after the fact, but Mr Bridges rejects that. It’s unthinkable, he says, that a department head would make a call like that without first informing his minister.

The way Mr Bridges sees it, the hacking was a cooked up story to smear National and take the heat off the government and the Treasury.

But the whole thing was cooked up by National in the first place.

Bridges acted offended when accused of hacking, but he hasn’t hesitated accusing Robertson, without any evidence. And he is also accusing Treasury.

RNZ:  Treasury knew there had been no hack on Budget information – National Party leader

The National Party is confident the investigation into Treasury’s claim Budget information had been hacked will prove that Treasury “sat on a lie”.

National Party deputy leader Paula Bennett, who asked the SSC to investigate, said her party would let the inquiry play out but stands by its assertion that Mr Makhlouf mislead New Zealanders.

It has previously said Mr Makhlouf should resign.

Mr Makhlouf says he acted in good faith.

National Party leader Simon Bridges told Morning Report today there were two possible scenarios, and the situation was likely a bit of both.

“You’ve either got bungling incompetence, and I think we can all believe that could well be the situation, or you have some broad form of deceit and … dirty politics.

“And we need to see what’s going on here.”

He said the GCSB told Treasury and the Minister of Finance that there had been no systematic hack, but Treasury came out after this and said there had been.

“The reality of this situation is it’s pretty black and white isn’t it.

So as a result of a deliberate and concerted effort by National to exploit a data vulnerability at Treasury in an attempt to embarrass the Government we now have two inquiries, and National have called on the Minister of Finance and the head of Treasury to resign. It has also jeopardised Makhlouf’s new job in Ireland.

MSN:  Gabriel Makhlouf’s next job at Ireland’s top bank under threat

Irish politicians say they’re concerned New Zealand Treasury Secretary Gabriel Makhlouf will become the country’s next Central Bank governor amid the Budget “hack” scandal.

Pearse Doherty, finance spokesperson for left-wing Irish republican party Sinn Féin, told The Irish Times Maklouf should not start his role with the Central Bank until the investigation has concluded.

Doherty said it “wasn’t a small issue”.

“We need to make sure that someone in the highest position in the Central Bank has proper judgement,” he told The Irish Times.

Ireland’s Fianna Fáil party member Michael McGrath has also reportedly sent a letter to the Irish Finance Minister.

“The governor of the Central Bank is one of the most sensitive and important roles in our States,” the letter says.

“It is vital we have full confidence in the holder of the office.”

So National may succeed in ruining Makhlouf’s career. Robertson is unlikely to resign – and I think it would be a disturbing result if he is forced to.

Sure Makhlouf and the Government may not have handled the budget leak well. But this was a dirty politics style hit job by National, serving no positive purpose, and highly questionable as ‘holding the Government to account’.

They would have hoped to cause some embarrassment, and got lucky when it precipitated a shemozzle, leading to two inquiries and careers in jeopardy – not because of the initial problem, but because of how it was mishandled. This is classic negative politics.

For what? Some budget information was publicised two days before it was going to be made public anyway. National well know that budgets are kept secret until announced in Parliament, and there’s good reasons for this.

This sort of thing really puts me off politics – especially off politicians who try to engineer scandals that really has nothing to do with holding to account.

If there wasn’t other things keeping me going here I think I could happily pack up and go and do something else as far from politics as I can get.

This political debacle sets a very poor example. It is a form of bullying – political bullying, where dirty means are employed to cause problems that needn’t happen. Shouldn’t happen.

Another thing that may keep me involved is looking at ways of getting our politicians to set positive examples, and save the hard ball holding to account to when it really matters.

Is there any chance of that? I’m probably wasting my time here.

Budget falls short of child poverty targets

This year’s budget was promoted as a Wellbeing Budget, but it has been criticised for not moving far enough towards addressing things that will improve the well being of the less well off, especially children.

Newsroom:  Budget moves not nearly enough to meet child poverty targets

This is the first Budget under the new Child Poverty Reduction Act rules. The Act is perhaps one of the most concrete and far-reaching changes the Government has introduced. From 2019 on, the Minister of Finance must report each year on progress towards preannounced three-year and ten-year child poverty reduction targets.

So how did Grant Robertson go first time out? How much progress towards cutting poverty was there actually in the Budget? The short answer is a bit, but almost certainly not enough to meet all three short-term targets by the deadline of June 2021.

The big Budget announcement was to index main benefit rates to changes in average wages rather than just the Consumer Price Index. It’s a great move, one which the Welfare Experts Advisory Group, and many other commentators in the field have called for. It means that part of the welfare system will keep pace with growth in wages instead of slipping further and further behind.

Approximately 55 percent of children in poverty live in households reliant on benefit as their main source of income. Indexation of the benefit to wages is an important long-term change, but indexation to inadequate basic rates is not enough. It will simply not be feasible to address child poverty without either (or both) raising benefit rates or the Working for Families tax credits paid to parents on benefit. We did not see either of these in this first Wellbeing Budget.

A budget is a budget, not an open chequebook as some seem to want it to be, Minister of Finance Grant Robertson has done a pretty good job of balancing economic prudence with the pressures to spend more on a wide range of things.

The last government was already nudging things towards more ‘social conscience’ spending. The current government has nudged things a bit more. Perhaps they will push things further towards wellbeing in the next budget, which is in election year.

Digital services tax proposals to target multinationals

The avoidance of paying tax by multinational companies is well known, but an effective solution is difficult to come up with. The Government has proposed two options.


Ensuring multinationals pay their fair share of tax

Finance Minister Grant Robertson and Revenue Minister Stuart Nash today proposed two broad options to ensure offshore digital companies no longer enjoy tax breaks which are not available to local businesses.

“Our number one preference remains an internationally agreed solution through the OECD,” says Mr Robertson. “However if the OECD cannot make sufficient progress this year we need an interim solution. Other nations have already taken this step.”

“The UK has announced it will introduce a two percent DST from April 2020. Austria, the Czech Republic, France, India, Italy and Spain have also enacted or announced DSTs.

“We need to protect our economy and the integrity of our tax system. Modern business practices, digitalisation in particular, mean that a company can be significantly involved in the economic life of a country without paying tax on income or turnover.

“Multinational companies like social media platforms and e-commerce sites generate income through cross-border digital services rather than face-to-face retail,” says Mr Robertson.

The DST outlined in a discussion document released today would apply to:

  • platforms which facilitate the sale of goods or services between people, such as Uber and Airbnb and eBay;
  • social media platforms like Facebook;
  • content sharing sites like YouTube and Instagram; and
  • companies which provide search engines and sell data about users.

“A DST would be narrowly targeted at certain highly digitalised business models. It would not apply to sales of goods or services, but to digital platforms who depend on a base of users for income from advertising or data.

“The value of cross-border digital services in New Zealand is estimated to be around $2.7 billion. The estimated revenue of a DST is between $30 million and $80 million, depending on the design,” Grant Robertson said.

Revenue Minister Stuart Nash says the Tax Working Group concluded New Zealand should continue to participate in the OECD discussions but also stand ready to implement a DST if a critical mass of other countries move in that direction.

“The OECD is seeking approval for its digital economy work programme from the G20 group of large economies at a meeting in late June. The progress made at the OECD to date has not been sufficient to allay the concerns of several countries, who have announced or introduced DSTs as unilateral interim measures.

“Any DST in New Zealand would be an interim measure. The Government would look to repeal it if and when the OECD’s international solution was implemented,” says Mr Nash.

The two options are:

  • Changing the current international income tax rules, to allow more taxation in market countries.  This option is currently being discussed by the OECD and the G20 group of large economies.
  •  Applying a separate DST of three per cent to certain revenues earned by highly digitalised multinationals operating in New Zealand. The discussion document seeks feedback on how a DST might work in practice.

“The Government is committed to future-proofing the tax system to ensure it can handle changes to how people work and how business is done,” Mr Nash says.

“The significance of the digital economy is only going to grow over the coming decades. We need to keep adapting to ensure multinationals who do business here are paying their fair share of tax.

“We’ve passed legislation to collect GST on remote services, and to ensure multinationals pay their fair share of tax if they have a physical presence in New Zealand, and we have legislation before parliament to ensure we collect GST on low-value imported goods,” says Mr Nash.

The discussion document can be found at taxpolicy.ird.govt.nz. Consultation closes on 18 July 2019.

 

Grant Robertson on Newshub Nation

Minister of Finance Grant Robertson was interviewed on Newshub Nation yesterday.

First, the sideshow.

imon Shepherd: It’s the highlight of the political year, for the government and one man in particular, the Finance Minister. I asked Finance Minister Grant Roberson if he was disappointed that the unauthorised early release of budget details overshadowed his first wellbeing budget. 
Robertson: I don’t think that it did. The reaction that we’re getting from New Zealanders to the budget is that they’re really pleased that we’re focused on a big, long-term issue like mental health. I don’t think New Zealanders are focused on the political games in Wellington.
But there were so many of them. There was the leak of the documentation, the allegations of a hack — you sort of seemingly linking the National Party to that, and then it wasn’t a hack. It was shambolic.
Look, I’ve expressed my disappointment in the fact that the Treasury system could be infiltrated this way and also that the Treasury didn’t do more to find out what had happened before they referred it to the police. The reality is that that’s now in the hands of the State Services Commissioner, who is doing an inquiry, and we’ll await the outcomes of that.
Well, how do you think you handled it all?
Look, I invite you to put yourself in my shoes. On Tuesday night the Chief Executive of the Treasury arrived in my office and said about an hour ago I have referred to the police 2000, of what he called, hacks into the system. I said to him, ‘Do you know how that’s happened?’ He said, ‘No, I don’t.’ I said, ‘Do you know if any other areas of the Treasury system have been compromised?’ He said, ‘No, I don’t.’ So at that point, I’m going to take that matter pretty seriously. That’s what we did. Obviously more information has now come to light. That’s what the inquiry will cover.
Do you think you acted too quickly? Do you think you should’ve waited and got some more information before you put out that press release just then, which seemed to indicate that National was linked to the allegations of a hack?
Like I say, I think most people in my shoes, having received the information I did, would react and say, ‘Well, we need to make sure, regardless of how the National Party might’ve got the information, that they were aware of what the Treasury had advised me. We all now know that the situation is somewhat different. The inquiry will look into how that happened.

Then the meat of the topic.

You named it the Wellbeing Budget, but mental health aside, what is actually transformational about it?
I think the work that we’re doing in domestic and sexual violence is absolutely transformational. We’re talking there about breaking a cycle that has bedeviled New Zealand for many years. $320 million going into that. We’re going to transform the lives of people who are on benefits by indexing that to the average wage. That’s going to lift their incomes consistently.
Okay. Well, let’s talk about that. Obviously the Welfare Expert Advisory Group said 12-47 per cent boost to benefits is needed, something like $5 billion. You didn’t go near that. You’ve done $300 million. Why not?
Well, because we’re doing this in phases. And we’ve actually done three things —we’ve done, not only the indexation of benefits, but we’ve also lifted the abatement rate — the rate at which your income drops if you’re working while you’re on a benefit. And we’ve got rid of the sanction that was on mothers who didn’t identify the fathers of their children. That’s stage one. We absolutely acknowledge that there’s further work to do in this area.
Do you think that you missed a chance to be transformational by not implementing a capital gains tax?
Well, as you well know, I would’ve like to have implemented a capital gains tax. That, of course, would not have come into force until after the election. That was always the plan, but the realities of coalition government are we didn’t have the numbers for that.
What about a greater focus on business? If you lift them and provide incentives for business, that changes the whole economy, doesn’t it? So why didn’t you do that?
Well, we are. There’s a great deal of focus on supporting business. One of the things I’m really excited about in this budget is the $300 million fund for venture investment in those businesses that have got past the start-up phase and are looking to grow to be international companies, and Peter Beck from Rocket Lab has raised this issue with us and said, ‘Too many of these companies head offshore because there isn’t investment here.’ The government’s now got $300 million of skin in the game.
But I would say to you, that this country is made up — the backbone — is small to medium enterprises, and the businesses you’re talking about there are start-ups that want to go internationally. You’re not addressing the small to medium enterprises.
Well, I’d argue we are. The biggest issue raised with me by business is skilled staff, infrastructure, making sure we get those trade agreements going so people can export. They are the issues we are working on.
Could you have been more transformational if you’d relaxed your debt rules earlier? Is there a chance you could look back at this and say, ‘I wish I hadn’t played it so safe’?
It’s always about a balance. We have to make sure that we do keep our debt under control. We’re a small country. We’re susceptible to significant economic shocks and natural disasters. We are actually borrowing more money in this Budget. The economy is growing as well. That means the percentage of GDP stays steady, but we are borrowing to invest in those areas like infrastructure, building up KiwiRail, building more schools and hospitals. But it is all about a balance, and I think we’ve got it right.
Well, what about the balance — you’ve just mentioned shocks like natural disasters or international shocks. You are actually borrowing more. You are running down the projected surpluses. Are you leaving us vulnerable to something like that?
No, I don’t believe so. I mean, we still have a surplus of $1.3 billion here. We still have debt at a relatively low level. We are creating that balance, but we made a decision in this Budget to spend more than we had originally allocated, and that’s because the need was there. The need was there in infrastructure, but the need was also there in services like mental health. We always said, Simon, is that a sustainable surplus would be one where we’d met the needs that were there, so therefore this Budget that surplus is a bit lower, but it still exists.
Are you meeting the health needs though? Because National’s Amy Adams points out that policies for midwives, no free health checks for seniors, reduced GP fees — those kinds of things are not addressed in this particular budget. And in fact, figures from the Child Poverty Action Group show that spending on public health is forecast to be the lowest in a decade by 2023.
Well, what we’ve done is prioritise mental health, and we’ve been completely upfront about that from day one. We have a mental health crisis in New Zealand. It’s been ignored, but there’s still significant resources going into the rest of our health system, around $2.9 billion into supporting DHBs, more money for ambulances. There are other areas, within our coalition agreement, within our confidence-and-supply agreement that we’ll look to address in next year’s Budget, but we made mental health a priority.
Such as?
Well, you’ll have to wait till next year.
What about teachers, though? They’re crying out for some more love from the government, and they’ve just announced more disruptive action. So why couldn’t you address that in this Budget?
We believe we’ve got a fair offer on the table, the $1.2 billion offer. The Budget also addresses some of the non-pay-related issues that teachers have been raising. Six hundred learning support coordinators for what we used to call special ed. 2480 more teachers—
And yet they’re still unhappy?
Well, that’s the reality of the world. What I hope is happening, and I’m pretty sure it is happening right now, is that the Ministry of Education and the unions are sitting down together to say, ‘Look, how can we resolve this?’ We want it resolved. We understand the frustration of teachers after 10 years of not getting supported. Let’s take these first steps together now.
What is there in this Budget for middle New Zealanders? Sort of, those low to middle income families. There doesn’t seem to be anything.
Well, I’d give you one example. We’re removing school donations for decile one to seven schools.
But in the hip pocket there’s nothing like tax bracket creep or anything like that.
Well, look, we’ve made a commitment not to change tax rates in this term of government because we believe that we need the resources that are there to meet the needs that are there.
Well, let’s talk about housing. There is nothing actually, really, apart from the Housing First — the transitional housing — there’s nothing else for housing in this Budget. You’ve got KiwiBuild, which has stalled at the moment because it’s not delivering.
We put $2 billion in last year’s Budget for KiwiBuild for the life of the programme—
And it’s not delivering.
And as you know, there is a housing reset coming forward, and actually in the Budget documents we state that we’ve put some money aside to help manage that housing reset.
How much?
You’ll see the details of that when the reset’s released.
What about the policies that you agreed with the Greens, like a shared equity scheme to get more people to be able to afford to buy into our houses. What happened to that?
As I say, you’ll have to wait for the housing reset that Minister Twyford’s going to announce, but clearly we’ve got a large-scale building programme for housing that’s not just about KiwiBuild. It’s about state housing, transitional housing. Mr Twyford’s now going to come back with that reset, and you’ll be able to see—
But there’s 11,000 people on the state housing list, and there’s nothing extra in this Budget for them.
Well, we made a significant investment in the building of 6000 state houses in the last Budget. We’ve got an integrated programme with transitional housing and affordable housing. Phil Twyford’s going to announce a housing reset. We’ve set some money aside to support that.
What would you say to business-owners, teachers and say, middle income, low-income earners — some of those feel left out by Budget 2019. What would you say to them? What hope will you offer them for next year?
Look, I’ve always said that the three budgets of this term are a trilogy. Last year we did the foundation-building of making sure we got spending back into those core areas. This year we’ve targeted areas like mental health that all of those people will benefit from. We’ve got a third Budget to come as well.
So is that going to be the blockbuster for these people?
No, I see them all as part of an attempt to start turning around a decade of neglect in a lot of important areas in New Zealand. Two-thirds of the way through, I think we’re making good progress.

A pretty good budget

I despair about the circus leading up to and surrounding yesterday’s budget. Media even investigated the person on the cover photo of the printed budget in a bizarre sideshow. And there were a number of ‘what’s in it for you’ angles, despite lolly scramble budgets largely being very historic,

But for what really mattered, I think that yesterday’s budget was pretty good, delivered by someone who increasingly looks like a pretty good Minister of Finance, Grant Robertson.

A significant boost to mental health related initiatives is long overdue, and very good to see,

Indexing benefits to wages is also a long overdue fix to the erosion of benefit value over the years.

There’s a bunch of other stuff that can be praised or quibbled about, but generally it seems ok to me.

There is always a limit to how much a Government can spend of our money, and there’s a limit to tolerance of how much we are taxed. Robertson and the Government seems to me to have found a fairly good balance. They will never please all of the people all of the time, but I don’t think there’s much to be worried about.

Treasury refer claimed hacking to police following budget leak

The budget leak publicised by National yesterday has got a lot murkier, with Treasury now saying they have been hacked. The matter has been referred to the police, but Leader of the Opposition Simon Bridges is unrepentant for trying to hijack Thursday’s budget announcement.

The leak looks embarrassing for the Government, and also for Treasury, but I think the leak stunt also reflects very poorly on Bridges and National. Bridges has demanded that Minister of Finance Grant Robertson resign over the leak.

1 News: Budget 2019 leaks by National came after Treasury was ‘deliberately and systematically hacked’

Earlier today the National Party leaked what it claimed were highly secretive details of the Government’s wellbeing Budget, due to be delivered on Thursday.

Treasury has confirmed in a statement it was the source of National’s Budget 2019 leaks today after its “systems were deliberately and systematically hacked”.

Confirming the hack this evening Treasury released the following statement:

“Following this morning’s media reports of a potential leak of Budget information, the Treasury has gathered sufficient evidence to indicate that its systems have been deliberately and systematically hacked.

“The Treasury has referred the matter to the Police on the advice of the National Cyber Security Centre.

“The Treasury takes the security of all the information it holds extremely seriously. It has taken immediate steps today to increase the security of all Budget-related information and will be undertaking a full review of information security processes.

“There is no evidence that any personal information held by the Treasury has been subject to this hacking.”

Responding to confirmation of the the hack, Finance Minister Grant Robertson said is a statement:

“This is extremely serious and is now a matter for the Police. We have contacted the National Party tonight to request that they do not release any further material, given that the Treasury said they have sufficient evidence that indicates the material is a result of a systematic hack and is now subject to a Police investigation.”

But Bridges continued on the attack:

If it turns out that budget documents were hacked from Treasury will Bridges resign for using hacked material to try to undermine the Government?