David Parker’s and Parliament’s reputations enhanced

Last week David Parker was under fire for alleged, with claims he had a ‘close personal relationship’ with property  developers given a Government exemption for overseas investment in a development at Te Arai.

Matthew Hooton said that Parker should stand down pending an inquiry, and made allegations that he later retracted and apologised for. A Facebook post and an NZ Herald article are no longer online.

On Thursday Hooton tweeted:

‘Entirely blameless’ is a major retraction.

Audrey Young writes:  David Parker emerges with reputation not just intact but enhanced

When things get really bad a fog can sit over the whole Government for weeks. Sometimes it results in a political scalp, sometimes it just damages the individual.

Rarely does it enhance the reputation of the minister involved. But in the case of the exemption for Te Arai development to the foreign-buyers ban, that is what has happened to David Parker.

The only other occasion in which a political reputation was clearly enhanced in the face of a ministerial crisis also involved David Parker, in 2006.

He shocked everyone including his own Prime Minister when he resigned as Attorney-General the day allegations were published in Investigate magazine over some historic filing of returns to the Companies Office.

Parker was reinstated to cabinet a few weeks later when evidence turned up at the Companies Office disproving the allegations. He returned a more honourable minister than when he resigned.

In the 10 days since the select committee recommended the controversial 15-year exemption for Te Arai development at Mangawhai, events have moved more slowly, but no less honourably.

And most of the stunning relevant revelations exonerating Parker occurred in House itself as National has put the heat on Parker.

National had legitimate questions for Parker about the background to an exemption for one development at Mangawhai involving settlement funding of two iwi – and Parker more than answered them, which he did so at length, and with reasoned and passionate argument.

It is National’s job to hold the Government and Ministers to account. In this case Parker responded and showed there was no cause for concern about his involvement.

What has emerged is that although the Treasury advised against any exemption for any development, it was done after Parker took a paper to cabinet and sought its approval.

Parker refused to listen to any private pleadings of any developer during the course of the Overseas Investment Amendment Bill banning foreign buyers from buying New Zealand houses.

He made it clear they should make to the committee.

When select committee members and cabinet colleague Shane Jones (at the behest of John Key) raised the potential injustice, Parker did the proper thing and took it to cabinet.

So Parker acted properly.

Disarmingly, Parker did not defend every aspect of what has occurred.

He conceded in the House it was fair enough that National question whether he and select committee should have looked into details about the level of the iwi involvement in the development before recommending the exemption.

As they haver a right to do this, and a responsibility to do this if they think that things warrant proper scrutiny. It was a proper use of Parliament. And Parker responded properly and showed that he had acted properly.

There are still things to be asked over the Te Arai development, but both Parker and Parliament have had their reputations enhanced over this.

Parker stands out as probably the Government’s most capable looking Minister.

New Zealand’s reputation at stake

Today’s ODT editorial says that “New Zealand is not a tax haven in the way many countries in the world operate” but the country’s reputation is at stake over the Panama papers revelations.

NZ’s reputation at stake

Prime Minister John Key is moving to protect the international reputation of New Zealand as a place to do business, with the release of the Panama Papers forcing his hand.

The Panama Papers have proved to Kiwis that this country is being used by foreign business people and global leaders as a way to pervert the tax laws of their home countries.

Let’s be clear, however. New Zealand is not a tax haven in the way many countries in the world operate. Our foreign tax laws may be used by overseas people to defraud their own countries of tax, but our tax base is not being exploited. Nothing about those trusts is illegal in this country with most apparently meeting our tax laws.

Nothing relating to new Zealand has been found to be illegal – yet – but if overseas people can use New Zealand’s trust laws to hide illegal activity or avoid tax illegally then it looks bad for New Zealand.

However it should be noted that if New Zealand wasn’t being used for questionable trusts other countries would be used – as they are, far more than New Zealand is.

What is at stake is New Zealand’s reputation which is seen around the world transparent and stable. We are consistently at the top of tables about the ease of doing business, the least corrupt country and one of the most transparent.

Mr Key is indicating a second phase of anti-money laundering measures may be brought forward in the wake of the Panama Papers. He denies the papers are evidence New Zealand is a tax haven, in line with tax experts. Here the foreign trusts need to provide information to Inland Revenue and the trustee fills out an annual return. In tax havens, little or no information is supplied to authorities.

If there is potential reputational damage then something needs to be seen to being done about it.

There has been no indication any of the people named were acting illegally, just that they were involved in some way or another. The tall-poppy syndrome is never far from sight in this country. The latest name dump is guilt by association, without context.

That is also a major issue that could affect reputations of those implicating named people in shady dealings.

Labour leader Andrew Little is saying Mr Key has damaged New Zealand’s reputation by siding with those people keen to limit their tax obligations. Labour will abolish foreign trusts but it needs to be said the current regime was put in place by former Labour finance minister Sir Michael Cullen in 2005.

Sir Michael required foreign trusts with New Zealand resident trustees to provide some tax information to Inland Revenue – exactly what is currently happening.

Thanks to the past Labour led government and the current National led government New Zealand’s tax and trust laws are (or have been) highly regarded. That is apparently a part of the problem, our reputation is being exploited by some people who want to use trusts.

The Government has appointed well-regarded accountant John Shewan to undertake an independent review of disclosure rules covering the foreign trusts in New Zealand. Mr Key indicated the Government is open to any changes Mr Shewan may suggest.

So far, New Zealand has complied with every information request from its treaty partners to the standard set by the OECD and $205 million has been invested since Budget 2012 to strengthen compliance work by Inland Revenue.

Reputational damage is hard to repair and Mr Key will be wise to act quickly on recommendations coming from both Mr Shewan and Inland Revenue.

The spotlight will be on Shewan’s report in particular. Somethig needs to be seen to being done.

For the good of New Zealand’s reputation Labour need to work positively with this with the Government to ensure our good tax and trust laws are improved.

Andrew Little’s integrity and reputation

Will Labour leader Andrew Little reconsider the accusations he made against John Shewan in Parliament yesterday? Little has attacked Shewan’s integrity but it might be his own reputation that’s more under threat.

See Little slams Shewan who slams Little and John Shewan on Radio NZ where Shewan says “And it’s very disappointing to hear the statements made today because they’re completely and utterly inaccurate.”

Little has talked about integrity in the past. Last week:

“New Zealand’s reputation is at risk from the reports emerging from the so-called Panama Papers.”

“The Prime Minister must take urgent action to close this loophole to protect the integrity of New Zealand’s tax system and our international reputation for honesty and transparency,” Andrew Little says.

Posted by on April 04, 2016

Integrity. And reputation. Two things that Little could do well to reflect on – both for himself and for the country he wants to lead.

Also from Labour’s website: Meet Andrew Little

My whole life, I’ve had a deep and abiding intolerance for injustice. The injustice I mean is when the powerful and the privileged abuse their position to take advantage of the weak.

Yesterday Little used his privileged position as a party leader in Parliament to attack and criticise Shewan.

It sticks in my craw and I am compelled to stand up to it, to fight it and to end it.

And ironically considering recent suggestions that Little is acting like a dog yapping at every passing car:

It takes a long term view, keeping your eyes on the prize, not being drawn into every battle and skirmish and never giving up on what matters.

In response to Little’s attack in Parliament Shewan said “I absolutely reject any suggestion that I’ve acted in anything other than a totally professional way, and I do object to some of the very misleading so-called facts which are complete myths that are now being perpetrated in Parliament.”

Little  attacked Shewan’s reputation from his powerful and privileged parliamentary pulpit. But his reputation and his future may be at greater risk.

How Little responds to this is a test of his integrity.