Hon MAURICE WILLIAMSON (Minister for Building and Construction) Link to this
I move, That the Protected Disclosures Amendment Bill be now read a third time. It would be appropriate for me to restate that this bill is to strengthen the current purposes of the Act in promoting the public interest, by facilitating the disclosure and investigation of serious wrongdoing in or by an organisation, and by protecting employees who, in accordance with the Act, make such disclosures. The bill has two parts. Part 1 contains amendments to the Protected Disclosures Act 2000, and Part 2 contains a transitional provision.
In December 2003 Trevor Mallard, the then Minister of State Services, tabled a report in the House on the Act’s first few years. Prepared by Mary Scholtens QC, the report concluded that the Act had not been used a great deal and it had not always been used well. Without a central coordinator, the range of appropriate authorities to which employees disclosed was confusing. Some disclosures fell between the gaps in the jurisdictions of those authorities. Ms Scholtens also referred to a strong perception among some of those consulted on the Act that the identity of a whistleblowing employee would not be protected. Ms Scholtens concluded that the Ombudsmen could assist whistleblowers, coordinate referrals between appropriate authorities, and guide and review the Act’s operation. The bill gives the Ombudsmen that enhanced role. It also picks up on a number of other recommendations designed to improve the Act’s protections and processes.
The bill was considered by the Government Administration Committee, which recommended two minor changes. The first is the insertion under clause 6 of a new section 6C(2): “An organisation is not required to comply with a request made under subsection (1) if it is not a public sector organisation.” The amendment is designed to make it clear that a private sector organisation is not obliged to comply with a request from the Ombudsmen for information about the organisation’s internal procedures. New sections 15 to 15E are substituted in the bill under clause 8, and the second amendment is that section 15E(3) is amended to include section 30 of the Ombudsmen Act. Including a reference to section 30 makes it an offence to refuse to provide to an Ombudsman the information specified in section 15E. This applies to only public sector organisations. The change is designed to enhance the workability of the section by providing a deterrent to a person who, without lawful justification or excuse, fails to comply with a lawful requirement of an Ombudsman.
The Ombudsmen will be authorised to provide information and guidance to public or private sector employees on using the Act at any time, not just on request. For example, the Ombudsmen will advise on what serious wrongdoing is, and on whom to complain to. This should provide a filter for misguided disclosures as well as encourage whistleblowers to throw light on serious wrongdoing. Public sector organisations are required to have internal procedures on how disclosures must be made to them and how such disclosures will be investigated. The Act requires that whistleblowers must first disclose in accordance with their employing organisation’s internal procedures. Complying with internal procedures can be difficult if there are none in that operation. Section 6C empowers the Ombudsmen to request the internal procedures and related information from an organisation concerned. As a result, organisations may be encouraged to have a good, effective protected disclosures policy in place. Employees’ confidence should also increase if they know what the employing organisation’s internal procedures are.
The Ombudsmen will have new powers to review and guide a public sector organisation’s investigation of whistleblowing under section 15B. The power to guide investigations is facilitative rather than directive, and the power will be activated either on the organisation’s request or at the Ombudsman’s discretion. This should help prevent disclosures of serious wrongdoing from circulating around various agencies without resolution.
Currently, the Ombudsmen may make reports to Parliament under section 29 of the Ombudsmen Act. Section 15C of the bill specifies a number of matters on which the Ombudsmen may report about the exercise of their powers under the Protected Disclosures Act. The list includes the number and types of inquiries made to the Ombudsmen under the Act. This list is designed to provide Parliament with more information on how the Act is operating and on how the Ombudsmen are carrying out their powers. These new sections just described come with information-requiring powers conferred by section 15E(3). The Ombudsmen will be able to require information from public sector organisations, in keeping with current limits on their investigative jurisdiction. Private sector organisations will not be required to comply but will be encouraged to do so. There are inbuilt protections from the misuse of such powers already in the Ombudsmen Act and in the bill.
Under section 15A an Ombudsman will be able to take over a public sector organisation’s investigation of serious wrongdoing alleged against it. The trigger is that the Ombudsman considers that sufficient progress had been made by the organisation, and the whistleblower consents to the takeover. The Ombudsman may also investigate in conjunction with that organisation. In addition, the Ombudsman will take on a coordinating role under section 15 in relation to protected disclosures that have already been made to another person or body. Again, this applies only with the whistleblower’s consent in exceptional circumstances, such as urgency. An Ombudsman may refer on the disclosure to an appropriate authority, or to a Minister, to investigate. Alternatively, she or he may investigate when the matter relates to a public sector organisation.
The bill extends the Act to a wider range of people and bolsters the Act’s protections. The term “employee” will include volunteers who work for no reward. Board members and members of local authorities will be able to whistle-blow under the Act, and both groups will be “employees” for the purposes of confidentiality of identity, immunity from liability, and anti-victimisation protections in the Human Rights Act. Contractors are already covered under the Act.
Even with the Act’s protections, whistleblowing carries some personal risk to employees, but silence is not in the public interest. Measures in this bill are designed to give more substance to the Act’s protections, which include the Ombudsmen assisting organisations to keep the confidentiality of disclosures, the expansion of the Act to protect volunteers of information in support of an existing disclosure of serious wrongdoing, the expansion of protection to people who reasonably but mistakenly believe they are disclosing serious wrongdoing, the declaration as unlawful of agreements that seek to contract out of the Act, and the clarification that disclosers are not excluded from the Act merely because they do not refer to the Act by name when disclosing. Further, technical non-compliance with the Act’s processes for whistleblowing will no longer prevent an employee from coming within its protections.
I thank members of the House for their support for this important legislation.
GRANT ROBERTSON (Labour—Wellington Central) Link to this
It is an honour to follow on from Mr Williamson, who has been known to make the odd disclosure from time to time. I am sure he appreciates the spirit behind the Protected Disclosures Amendment Bill. This legislation was brought in by the previous Labour Government, and we are very pleased that the National Government has picked it up in the absence of any new ideas from that side of the House.
We remind ourselves, too, that the original Protected Disclosures Act was brought in by Labour in 2000. It followed a period of time in the 1990s when there were concerns about the ability of people in the public sector—and also in the wider private sector—to be able to blow the whistle when they saw serious wrongdoing. We think of the case of Neil Pugmire and Lake Alice Hospital, which was obviously a very difficult time. The original Act was brought in to make sure that people could make those kinds of disclosures without fear of anything untoward happening to them. But, as with much new legislation, the Act needed to be reviewed, and Labour reviewed it after it had been operating for a couple of years. As Mr Williamson said, the Act did not lead to the number of disclosures that people thought it would. It became clear after the investigation that was undertaken by Mary Scholtens that this was an Act that people were unaware of. They did not know the processes for how they could make a complaint under the Act. In fact, generally, it was not operating as well as people would have liked. So these amendments in the Protected Disclosures Amendment Bill are the result of that review.
The bill essentially addresses three issues. The first issue is the lack of good or accurate information about the Protected Disclosures Act. New section 6B, inserted by clause 6, deals with this issue, so the Ombudsmen are now empowered to provide information and guidance to employees about their rights. That is very important. Not everybody knows what they are allowed to do in terms of blowing the whistle, particularly when there are people working at different levels of an organisation who may never get to see the internal procedures that are around in that organisation. In hospitals or district health boards there are a lot of different people in those organisations at different levels. This bill will enable the Ombudsmen to provide guidance, and that will do two things: it will weed out some complaints that perhaps should not be taken under the Protected Disclosures Act, but it may also shed light on those complaints that would not have had light shed on them were it not for a guiding hand. So that is an important role for the Office of the Ombudsmen, and I am glad that better information will now be provided to those who wish to complain.
The Ombudsmen now have an obligation to report on disclosures under this Act in its annual report each year from now on. That is important, too, because it means that the public at large will have some idea of how many disclosures are being made and the extent to which any further changes might be required to the Act. So the office has an enhanced role there. It also has an enhanced role in terms of making sure that the public sector itself is working through this Act appropriately. For instance, the Office of the Ombudsmen can request the internal procedures of an agency or department, and make sure it is meeting those procedures. The Ombudsmen can support the development of procedures if that is necessary, to make sure that whistleblowers have good procedures that they can work under.
But perhaps the two most significant things that the Ombudsmen can do are review and guide specific investigations and ensure that investigations can be taken over if that is necessary. That is quite a large extension of the role of the Ombudsmen, but it is known that from time to time departments will shuffle around complaints—complaints that perhaps cut to the heart of some of the business of those agencies—and there will be delays that are unacceptable for members of the public at large and also for those who are complaining. So sections 15A and 15B, inserted by clause 8, enable the Ombudsmen to take over an investigation in certain circumstances.
I think it is important to go back to the original Act to see what those circumstances might be. Those circumstances are, firstly, where an organisation has simply decided not to investigate a matter, and the Ombudsmen believe that it should be investigated; secondly, where the investigation has not taken place within a reasonable time after the disclosure was made; or, thirdly, if the investigation has simply not taken up a specific matter within the complaint that the Ombudsmen believe should to taken up. That is a very necessary protection, because from time to time organisations will, perhaps, try to sweep things under the carpet and we need to make sure that the Ombudsmen have those powers.
All of that represents a considerable extension in the powers of the Ombudsmen, and in the Committee stage of the debate I raised the issue with Government members of whether the Office of the Ombudsmen would be sufficiently resourced in order to take on those additional roles. It would be fair to say that what we have seen from the National Government over the past few months is a series of cuts into the Public Service and into agencies that we would normally think the National Government would not be interested in cutting into. The Inland Revenue Department is a good example. It is similar to the Office of the Ombudsmen, playing a very critical role in our Government system, yet the National Government has decided to cut 250 jobs out of that department.
No, that is the situation. National said it was just a cap on numbers but, in fact, it is a cut in that case. On this side of the House we are looking for an assurance that the Office of the Ombudsmen will be sufficiently resourced to undertake those additional roles. Both sides of the House acknowledge that those are important roles, and we need to ensure that the Ombudsmen have those resources. I have little confidence that the National Government will provide those resources and some fear that, in fact, there will be cuts in offices like the Office of the Ombudsmen over time. I would hate to see that happen, and the Act would not be able to operate in the way it is envisaged if those resources were not there.
The other critical aspect of the bill is the extension of the definitions of who comes under the Act. Essentially, the definition adds in those people who are volunteers in an organisation. The bill captures people who, for instance, are members of boards such as district health boards. In the Committee stage last night there was a long debate, which was introduced by Jacqui Dean, about the Otago District Health Board and the situation where clearly there was some serious wrongdoing, and, unfortunately, the person was able to get away with it for a long time. Then the person who was informed, and who was able to deal with the problem and ensure that things got back on track—the chair of the board, Richard Thomson—was sacked.
Well, that is a very good question. What was he sacked for? Tony Ryall, who is the Minister in charge of this bill—although we have not heard him speak on it throughout this debate—sacked the chair for, essentially, political reasons. That is what it was; it was for political reasons. That is not exactly an analogous situation, but in time there will be a need for people who are members of boards to be able to disclose—particularly given a Minister who seems intent on stamping his political agenda all over the important policy area of health. There will be people involved in the health sector who want to make sure that they have the ability to have their voice heard if they see wrongdoing, and that they will not be removed—sacked from a board—as Tony Ryall has done. They want to have the confidence that they are protected to make those kinds of disclosures. I do not have confidence that, without this Act, the National Government would protect people in that situation.
The other extension in this bill in the definition of who is covered is a widening of the definition of “public official”. So “public official” now means anybody working in a public sector organisation. Once again, we can see why an extension like this is needed. We have already seen Murray McCully, Minister of Foreign Affairs, attack the actions of an independent official—Joris de Bres, Race Relations Commissioner—because Mr de Bres went, of his own accord, to Geneva to the United Nations racism conference and spoke out there, as he should as an independent person, only to be bullied by Mr McCully and to be accused of all manner of things. Unfortunately, the public of New Zealand were left believing that perhaps Mr McCully did not realise or appreciate the independence of that position. So it is a good thing that this bill extends the provisions of the Protected Disclosures Act to people who work in the wider public sector organisations, because I have no doubt that, with the agenda of the National Government to slash and burn its way through the Public Service, many people will seek to blow the whistle. This bill and this Act will protect them in doing that, and that is a good thing. Labour supports this bill.
JACQUI DEAN (National—Waitaki) Link to this
I rise to support the third reading of the Protected Disclosures Amendment Bill. The Act was reviewed in 2003, yet here we are in 2009 only just addressing the third reading of the bill. I say thank goodness for a National Government, because it had the guts and the drive to pick up this bill, which, under the previous Labour Government had languished on the Order Paper. That Government did not have any particular drive to address the issue of protected disclosures, and what a shame that was. While that massive fraud was happening at the Otago District Health Board, for all those years since that 2003 review, what a shame it was that the Labour Government of the day did not have the fortitude to bring forward the amendments to the Protected Disclosures Act. That may well have made it easier for somebody—somebody—to speak out and make a disclosure about the fraud that was happening right in front of his or her very eyes. Somebody must have walked through the car-park of Dunedin Hospital and the Otago District Health Board and seen the Lamborghini, and somebody must have wondered: “How can a chief financial officer employed by a district health board under a Labour Minister of Health possibly afford the Lamborghini in the car-park? How can he possibly afford the large boat that is seen steaming out of Otago Harbour on its way to Moeraki and beyond?” Had there been these amendments to the Protected Disclosures Act, then maybe—just maybe—somebody might have gone to the chief executive and said: “I think we have got a problem.”
That did not happen, so I am pleased to see that under a National Government we have brought forward the third reading of the Protected Disclosures Amendment Bill. And to address the issue brought up by the previous speaker, Grant Robertson, who seems to have intimated that the chair of the Otago District Health Board was sacked just because the excellent Minister of Health, Tony Ryall, needed a scalp, I tell members that the National Government demands accountability. Somebody had to be responsible. Somebody had to be held accountable for the greatest fraud in New Zealand in a district health board. What are the implications? Here is what matters in this debate: what are the implications of that fraud? The implications of it are that a number of my constituents failed to get their operations—they failed to get those hip operations they needed so badly; they failed to get their cataract operations they needed so badly. These are the people who live in Ōāmaru. These are the people who live in Ranfurly. These are the people who must travel to Dunedin Hospital and to the Otago District Health Board to get their operations. They could not get them. A number of operations were not performed because of this large, massive fraud. What did the previous Labour Government do about it?
Hon Tau HenareSo here we have, finally, the third reading of the Protected Disclosures Amendment Bill.
As I have said, this bill gives effect to that review of the Protected Disclosures Act, which was done in 2003—almost beyond living memory as far as I am concerned, because it was such a long time ago. This amendment bill provides additional powers to the Ombudsmen. It provides additional powers for the Office of the Ombudsmen to request information, because what we must have in a protected disclosure situation is good, clear, important information. One of the amendments makes it clear that this information can be requested from both public organisations and private organisations, and it gives powers to the Ombudsmen to coordinate cross-agency activity. That is of the utmost importance if a whistleblower—and I will address that term in a moment—is brave enough to step up to disclose some information. It is vital that disclosure is backed up by the powers of the Ombudsmen to get some good, clear cooperation and some good, clear information.
The bill widens the definition of who is a public official and who is considered an employee. Under this bill a volunteer or a member of a local authority will be regarded as an employee. It is important in this debate to think about the person who is making the disclosure. Under this bill that person is termed a whistleblower, but the whistleblower is a person who has seen something within his or her voluntary organisation, has seen something within the board on which he or she sits, or has seen something within a district health board or private organisation. Whistleblowers do not like what they see, and they do not like what is going on around them—something being done either by someone further up the organisation, like a manager, or by a co-worker—which is even more difficult—or even by somebody subordinate to them. Amongst all the discussion and all the political point-scoring we must remember those people, because we call them whistleblowers, but they are people who have a hard decision to make: “Do I turn a blind eye to this, and pretend it is not happening, because if I do say something I might get into trouble?”. Imagine what it must be like to hold on to that information, knowing there is something very wrong, fraudulent, or bad going on. Imagine what it must be like making the decision to say something.
That is why this amendment bill is so very important. It simplifies, it gives comfort to people who feel strongly enough to do the right thing, and, in effect, to blow the whistle on wrongdoing. This bill allows whistleblowers to continue to receive the protection of the Act if they believe on reasonable grounds that the information provided relates to serious wrongdoing, even if this belief is found to be mistaken. I think that is a very critical part of this amendment bill, because somebody may have gone home, having seen a document or read an email and may not be sure about revealing the contents. It is in the public interest that that person has the comfort and confidence to say something; this provision in the bill makes that possible.
The other provision in the bill is that a process need not be faithfully followed for a whistleblower to enjoy protection under this bill. For example, getting back to the Otago District Health Board, had somebody said something about the fraud being perpetrated on the district health board and gone to the wrong person, one not prescribed in the company policy, if materially the complaint had been appropriate then that minor detail would not have mattered. I commend this bill to the House. I believe it provides streamlining. I believe it provides encouragement to people who feel they have information to impart that is in the public interest. I commend this bill to the House.
Hon DAVID PARKER (Labour) Link to this
The member who has just resumed her seat, Jacqui Dean, said that she could not remember back to 2003. Sadly, she cannot even remember back to last year, because the perpetrator of the fraud at the Otago District Health Board was never the chief financial officer, as she just told the House. He was the chief information officer. He ran the board’s computer system, not its finance.
Jacqui Dean says that is a minor detail, but that sort of detail is important. She fails to remember not just what happened in 2003 but also more recent events. She also omitted to tell the House that the Protected Disclosures Act, which was passed by the Labour Government in 2000, conferred protection—
I raise a point of order, Mr Speaker. The member has pointed out that I made a mistake in my previous speech.
The point of order is that I wish to correct what I said in my speech, because I have obviously made a mistake.
The ASSISTANT SPEAKER (Eric Roy) Link to this
Under which Standing Order is the point the member is seeking?
Hon Trevor Mallard Link to this
The Standing Orders are very clear on this. If the member wants to make a correction, it can be done at the end of the speech. She cannot interrupt it.
The ASSISTANT SPEAKER (Eric Roy) Link to this
Sorry; I just did not pick up the point of order. Yes, a point of misrepresentation should be made at the end of the speech. That is the convention.
Hon Trevor Mallard Link to this
I raise a point of order, Mr Speaker. First of all, there is no such thing as a point of misrepresentation, and I do not think the member raised that. I think she wanted to make a correction, which is something that should be done at the end of the speech.
Thank you, Mr Assistant Speaker. The other point that Jacqui Dean failed to point out to those who are listening to the debate is that were it not for the legislation that the Labour Government passed in 2000, there would have been no right for the people employed by the Otago District Health Board to make protected disclosures. Throughout the period of the fraud by Mr Swann they had that right, but, sadly, no employees availed themselves of it.
We also heard from Jacqui Dean that she could not understand why the Labour Government, having passed this good legislation in 2000 and having conducted a review of it in 2003, did not give more priority to this amending legislation.
It is clear that we did not give more priority to this amending legislation because we had other more important priorities. We had more important priorities, and I thought that I would run through some of them. During that period, of course, the Labour Government placed a greater priority on extending the generosity of the Working for Families tax package, which extended generous tax relief—or more generous tax relief—to many, many hundreds of thousands of families in New Zealand. That measure is worth an extra $80 to $100 per week for them, and it lifted 130,000 children out of poverty. The Protected Disclosures Amendment Bill is important. This Government would not have proceeded with it, and the previous Government would not have introduced it, were it not important. But it was not more important than the extension of tax relief that lifted 130,000 children out of poverty through extensions to the Working for Families legislation. That is why we put that legislation ahead of this legislation.
We also decided that KiwiSaver was more important than this legislation. KiwiSaver went some way to addressing the problem that New Zealand has with low levels of private savings, and it did this by way of tax credits to the employee and tax credits to the employer. We knew as a Labour Government that that scheme was more important than the Protected Disclosures Amendment Bill, and that is why we gave that legislation priority. It is interesting that National thought, on one level, that KiwiSaver was more important than this bill, but National’s response was to cut KiwiSaver instead of building on it. We know that all of the people in New Zealand who are in KiwiSaver and who have had a tax cut under National are worse off because the losses they suffer under the KiwiSaver cuts cost them more than the benefits they got under the tax package.
What else did we think was more important than advancing the Protected Disclosures Amendment Bill earlier? We cut the corporate tax rate from 33 percent to 30 percent, and we put that ahead of proceeding with the Protected Disclosures Amendment Bill. I again suggest to the House that that was the appropriate priority.
What else did we do? We thought that it was more important to progress legislation in the area of the sustainability issues facing the world than to progress amendments to the protected disclosures legislation. We proceeded through some very difficult and hard-fought legislation that was very important, not only to New Zealand’s environment but also to the world environment. I refer to the pricing of greenhouse gas emissions through the emissions trading scheme, which gives an incentive to business to reduce emissions rather than increase them.
I do not resile from the fact that we gave all that legislation priority over this legislation. Indeed, for the period that I was the Minister of State Services, I was happy for those things to be given priority over and above this legislation.
I am happy that the National Party in Opposition also recognised the wisdom of this legislation. Probably, that was because the Government Administration Committee that considered it had those intellectual giants that the National Party was then more populated with, including Brian Connell, who was on the select committee making sure that this legislation was as good as it could be. He was most ably assisted by the other Einstein of the National Party, Sandra Goudie. I am so pleased that through the good services of those members of the National Party, we had support for this legislation, and I thank them for it. Without it this legislation would perhaps not be back here.
I return to the substance of this legislation. This bill improves the ability of those who suspect or allege wrongdoing to bring it to the notice of the other people in the Government who have the responsibility to sort it out. It has a history. Back in the 1990s Neil Pugmire lost his job as a consequence of making a disclosure of serious wrongdoing in his organisation. We thought that the injustice he suffered ought not to be visited upon other people.
This bill improves the legislation in a number of ways, as Mr Williamson and Grant Robertson have already summarised. It extends the role of the Office of the Ombudsmen so that the Ombudsmen can tell people how to go about this process without getting themselves into trouble. That is a very good thing. The bill makes the legislation more workable. It also—this is important—enables the Ombudsmen to take over inquires where they are being ignored by the responsible organisations, or where organisations have deliberately, on some occasions, frustrated the purpose of the complaint by excluding an important part of the complaint from the inquiry that is being conducted. I hope that both of those powers will need to be used only rarely.
I hope in most situations that a whistleblower, having brought things to the attention of senior people in an organisation, could rely upon that organisation to do the proper thing, as Richard Thomson did at the Otago District Health Board when matters came to his attention. And I hope that when people in an organisation investigate, it is not just the whistleblower but also those more senior people in the organisation who deal responsibly with the alleged wrongdoing who are protected, and that they are not cut off at the knees in the way that Richard Thomson was by Tony Ryall.
Again, we have Jacqui Dean not remembering that it was a chief information officer rather than a chief financial officer. Not only is she acknowledging that she cannot remember things that have happened since 2003 but also she is now denying that Richard Thomson was sacrificed by Tony Ryall for political ends, despite the fact that Richard Thomson could have done nothing more than he did because he knew nothing of the wrongdoing until it was brought to his attention. When it was brought to his attention, it was he who dealt with it transparently, who ensured that the offender was, through the police, brought to justice, and who brought an end to that terrible financial fraud that was being perpetrated by Mr Michael Swann. For that, Richard Thomson was thanked by being removed as chair of the district health board. That is hardly the way that one would encourage organisations to deal properly with wrongdoing when it comes to their attention.
On behalf of the Labour Party, I am happy to indicate that we will be supporting this legislation at its final vote.
KEITH LOCKE (Green) Link to this
The Green Party will be supporting the Protected Disclosures Amendment Bill. It is a step towards making the public sector more accountable and it is a part of good governance. I do not want to just go over the points that the Green Party made in earlier speeches on this bill. I thought it would be good to put my speech in a broader context of why the public sector should provide an example of good governance for the community and the private sector. It seems to me that there are three aspects to good governance in public sector organisations. The first is that we have good and well-oiled procedures, particularly to prevent financial mismanagement and wrongdoing. The second is that we need transparency, and, thirdly, we need the provision provided in this bill for whistleblowing.
It is interesting to read the annual report of the Office of the Ombudsmen—there is a nice picture in there of David McGee, one of the Ombudsmen, who is our previous Clerk of the House. On transparency, it says “In recent years we have observed an increasing tendency on the part of some agencies and some Ministerial offices to ignore the provisions of the Official Information Act 1982 (OIA) in terms of the timing of their responses to requesters.” It says later that it has been “observed that in certain sectors a regrettable tendency to ‘game’ the system seems to be emerging, in order to delay responses until the currency of the complainant’s interest has passed.” So there is work to do regarding transparency.
I take the point the Minister made in introducing the third reading: the private sector is not required to comply with this whistleblowers’ legislation, but will be encouraged to do so. When I was thinking of the private sector, I thought particularly of the world financial crisis that is upon us. A lot of that is a result of a lack of good governance in terms of a lack of proper procedures, a lack of proper transparency, and no whistleblower provisions of any consequence.
It was interesting that on 3 April the OECD said there was $11 trillion parked in tax havens, which is more than 10 times the total amount committed by the G-20 leaders to revive the global economy. When we are looking at the lack of good governance and proper whistleblowing, we see that the financial system of the world is very much uppermost in our minds. In this list of 39 countries that are not fully compliant with international tax standards, there are two places that are part of New Zealand: Niue and the Cook Islands. In the Pacific more generally, there are Vanuatu and Nauru. So we have a little way to go in bringing the rest of the Pacific into line with international tax standards. When we look at rectifying the world financial crisis and see about $11 trillion parked in tax havens, we see that the annual tax being dodged would solve a lot of the problems of the developing countries. They are dodging probably $200 billion or $300 billion in tax.
I think this is important when we look at bringing the world economic crisis down to our own financial collapses, particularly those of the finance companies. At the present time Rod Petricevic and four others from Bridgecorp are before the courts for making false statements. What was the problem there? Clearly, there was a problem with the proper procedures being followed, there was a problem with transparency, and, to relate to this bill directly, there were no proper provisions, or openings, for whistleblowing. Bridgecorp had quite a lot of employees. It must be the case that many of those employees knew what was going on but they did not blow any whistles, probably because they were concerned about what would happen to them, their employment, and their careers.
I think this bill is important for the Public Service, though it applies, as previous speakers have said, not only to people employed directly by the Government but also to people on boards and volunteers in the public sector. It is important for us to provide a model for the private sector to follow. I think it is also an indication to those who think that privatisation is the way to go and that private companies are more efficient and more transparent, etc., that, in fact, society is moving in the opposite direction. It is the public sector that is providing the example in respect of this whistleblowing legislation and other measures; we have to drag the private sector along behind us.
We have seen what has happened in previous privatisations—for instance, New Zealand Rail, where the people who took over that company in 1993 virtually stripped it by not putting in any money to repair the tracks, and by taking out as much money as they could in dividends. We are still trying to recover from that situation. The Government has quite a big task to put the required money—and it is needed—into redeveloping the rail system.
The Green Party does support this whistleblowing legislation. It is good that the Ombudsmen are going to be involved and working alongside people who perhaps do not quite know where to go and are a bit intimidated by the people immediately above them. In terms of the procedures in the original Act, those people are supposed to report through the line of command, but their grievance might be in relation to someone immediately above them and they may want to go around that person. The Ombudsmen will help them to do that. The Green Party is fully in support of this important legislation. Thank you.
JOHN BOSCAWEN (ACT) Link to this
It is a pleasure to stand and take a call on this occasion, particularly for me personally, because I have been ill on my back for the last 3 days, and, sadly, had to listen to Dr Cullen’s valedictory last night from the comfort of my living room in Auckland. So it is good to be back in the Chamber.
Before I address the Protected Disclosures Amendment Bill, I wonder whether I might have the House’s indulgence to acknowledge the fact that I, along with four of my colleagues, have just returned from the Speaker’s tour with the Hon Dr Lockwood Smith—a tour of 5 days in Japan and 5 days in Viet Nam. I had the privilege of travelling with Nicky Wagner, Dr Ashraf Choudhary, Raymond Huo, and, of course, Dr Lockwood Smith. I think the trip was an outstanding success, and I believe huge credit goes to Dr Smith. During the course of our very many meetings with members of the Government of Japan, and in Viet Nam, it was very obvious that Dr Smith’s experience—first, 6 years as a Minister of Education, and then 3 years as an Associate Minister of Finance—was absolutely invaluable in our negotiations and meetings.
We met with the President of Viet Nam, who was—and I will keep this brief—second only to the chairman of the Vietnamese Communist Party, and Mr Trong, the chairman of the National Assembly of the Socialist Republic of Viet Nam. In Tokyo we met with the Minister of Finance, Prime Minister Aso, and also Speaker Kono, the Speaker who invited us to Japan in the first place.
I was not intending to take a call on this bill, but the last two speakers have urged me to my feet. I had said to my colleague Mr Flavell of the Māori Party that I would not be speaking. But what did Mr Parker say? After getting up and justifying the fact that the Labour Government had done nothing with the Protected Disclosures Amendment Bill, he went on to talk about and list the things that Labour had done. He said that Labour had introduced Working for Families. That was the subject of a question that I put in the House this very afternoon. Working for Families imposes on working families a marginal tax rate of between 55 percent and 60 percent. If Working for Families recipients want to improve themselves by working overtime, they will be penalised with tax rates of 55 percent to 60 percent. I say 55 percent to 60 percent because that is the rate that applies to most Working for Families recipients. Sadly, for recipients earning between $10,000 and $20,000 the rate is actually over 100 percent. Under Working for Families, people earning between $10,000 and $20,000 actually lose every single cent of any extra income they earn. For those earning between $20,000 and $80,000, the marginal tax rate is 55 percent to 60 percent. So Working for Families is a classic example of a scheme that was very badly designed.
I also refer to the fact that the marginal tax rate—
I raise a point of order, Mr Speaker. We are on the third reading of the Protected Disclosures Amendment Bill. Thus far, I am not sure that the member speaking is aware that that is the bill that is being debated. Although we expect a reasonably wide-ranging debate on a third reading, the points that the member is raising are not related in any way, shape, or form to the bill.
The ASSISTANT SPEAKER (Hon Rick Barker) Link to this
The member has made a good point. I say to the member speaking, Mr Boscawen, that he is 3 minutes and 20 seconds into his speech, and he has mentioned the bill in passing once. I suggest that he now, having made some preliminary comments, brings himself to the bill. The third reading is about the bill; it is not a wide-ranging discussion on a member’s recent Speaker’s tour or party policies on other matters. We are now discussing the Protected Disclosures Amendment Bill.
I did not want to leave the comments of Mr Parker unchallenged. Before I come back to them, I will address issues in this bill.
I thought it was particularly interesting that the speaker from the Green Party, Keith Locke, referred to the problems with Bridgecorp and other finance companies. I think it is important for people who disclose this sort of information to have protection—I believe that. In the course of the research I have been doing on the collapse of finance companies, I was given the minutes of a directors’ meeting of a particular finance company. The minutes said, quite bluntly, that 80 percent of the company’s money was coming from elderly widows, and that that was the market it was targeting. The minutes stated that advertising had to be directed at that market, and referred to television advertisements that addressed particularly that market. I wondered what the typists and secretaries—those people who typed and read that information—thought about the company they worked for. That company went out and deliberately targeted elderly widows because that was where its money was coming from, even though it knew that it might not be able to pay back the money. Those minutes went on to record the fact that there had been discussions with the Securities Commission that were of a minor nature and of no concern to directors. In essence, they were a record of the fact that the management had reported to the directors that they did not have to worry about the situation as they had not been caught, and that they could go on with what they were doing.
I totally support the Protected Disclosures Amendment Bill. The ACT Party will be voting for it. Just before I sit down, I note that Mr Parker boasted about the very many things the Labour Government had done rather than passing this bill. One of the things he did not boast about was purchasing the railways. That was a great thing the Labour Government did! It purchased the railways, which probably cost the taxpayers of this country in excess of $1 billion. Thank you.
TE URUROA FLAVELL (Māori Party—Waiariki) Link to this
Ā, kia ora koe, kia ora tātou katoa i tēnei ahiahi. Exactly 1 month ago my colleague Rahui Katene stood during the second reading of the Protected Disclosures Amendment Bill and spoke of the concepts of accountability, transparency, and credibility as being at the core of this legislation. I thought that a good place to start in the third and final reading would be to remind ourselves of these core values.
I am told that perhaps the most explicit proof of these core values is the way in which New Zealand’s ranking in Transparency International’s Corruption Perception Index is maintained or improved. In 2006 New Zealand’s score was 9.6 on a 10-point scale, meaning that it ranked first-equal with Finland and Iceland as, apparently, the least corrupt country in the world. Mind you, I do not know whether I would say that too loudly this week in Christchurch, where close to 470 workers were purged into limbo-land and are now waiting to see how they will fare from the collapse of clothing maker Lane Walker Rudkin. Maxine Gay, the secretary of the union’s clothing and textile section, did not muck around or mince words. She stated: “Hundreds of jobs are at stake and we are sure that poor management is at the heart of the problem.” I am not about to move into the dangerous territory of perhaps suggesting that the operations of Lane Walker Rudkin were corrupt, but there is little doubt that the company has been unprofitable, and it has been forced into taking on greater amounts of bank debt.
As I understand it, Lane Walker Rudkin would not have been affected by this bill; Business New Zealand took care of that. I believe this to be the case because the Employers Federation and the Manufacturers Federation—now amalgamated to form Business New Zealand—recommended in their public submission on the bill that any references to the public sector should be omitted from the bill. That advice, which was taken up in the bill, was that the role of the Ombudsman was primarily to investigate complaints against public sector organisations, not private sector organisations. As I consider the fate of the people who were working in the textile industry, I wonder how their interests would have been protected if serious wrongdoing was evident. How would these employees have been looked after while they watched yet another company collapse from poor management?
It is a most appropriate time to be reviewing our international status as one of the least corrupt countries in the world. Is it true that we are a pure and green haven of peace in which corruption has no place, or is our corruption-free status more a reflection of what we measure? Perhaps a stronger barometer of public opinion might be gauged from the casualties of the finance company collapses that Mr Boscawen often refers to.
Many people have looked on with amazement at the directors of companies who have carried on with their exclusive lifestyles, having ripped off ordinary New Zealanders. I wonder how, for instance, the 17,000 investors in Hanover Finance can reconcile the extravagant international birthday party of co-owner Eric Watson with the small matter of a debt of $553 million owed by the company. According to estimates, research shows that the amount of white-collar crime is approximately four times that of benefit fraud.
One can only wonder why we do not have the same enforcement mechanisms and policy focus in relation to these offenders as we do when the debt is owed to the Crown in the shape of Work and Income. We spend very little time discussing organised white-collar crime, and I have to wonder why. How can we accept that some offenders, through the resources they have at their disposal, are able to drag out cases ad infinitum in order to continue to enjoy luxurious lifestyles financed by the proceeds of their greed?
In the course of researching this bill I came across a letter from a former detective by the name of Tata Pārata of Stokes Valley here in Wellington. He stated, no doubt tongue in cheek: “Maori offenders should wise up and seek a better return for their criminal pursuits. Why are white-collar individuals with dollar sign profiles able to whisk easy money from gullible folks for returns that fail to materialise?”. I find that pretty fascinating. Corporate corruption and wrongdoing is of interest in this bill only if it occurred in the public sector. This bill is focused purely and squarely on how to ensure the better protection of whistleblowers who have laid complaints of wrongdoing against public sector organisations.
I want to make it clear that despite my concerns about the exclusion of private sector organisations from being obliged to comply with a request for information about their internal procedures, the bill is still a very good bill. It is a good bill in terms of clarifying issues of interpretation and inconsistency, which have got in the way of the proper use of the legislative procedures.
We in the Māori Party believe it is right and just that those who blow the whistle should be entitled to receive the protection of the Protected Disclosures Act 2000. If we are to engage and encourage people to come forward to provide information of serious wrongdoing, then they need to know that they are safe to do so. Once the whistle has been blown it is too late for an organisation to suddenly realise that its internal procedures are lacking. Individuals need to know that their identity will remain confidential and that transparent procedures and consistent practices are in place before they put pen to paper. Individuals need to know there will be an appropriate authority to respond to their disclosures, and that if their complaints go to the Ombudsman, they will be managed in a professional and sensitive manner.
The Māori Party is pleased with the amendment that affects section 30 of the Ombudsmen Act, making it an offence to refuse to provide to the Ombudsman the information specified in that provision. We support the extension of human protections to those making disclosures of serious wrongdoing. They must be protected, and they must be able to provide free and frank advice. The Māori Party supports this bill, and we support it in the name of human rights.
JOHN HAYES (National—Wairarapa) Link to this
Thank you for the opportunity to speak on the third reading of the Protected Disclosures Amendment Bill. I particularly commend the comments from my colleague in the Māori Party, Te Ururoa Flavell, and endorse them. I rise in support of this bill. Like my colleague from the Māori Party, I too listened to the comments of David Parker and his justification for his party’s non-promotion of this bill.
I commend Tony Ryall and the Government for introducing this bill and progressing it. In doing so we are promoting the public interest, for two reasons. This bill will facilitate the disclosure and investigation of serious wrongdoing in or by an organisation. I will shortly come to a set of circumstances that may explain the reasons why Labour was very keen that this bill would not be introduced during the last Parliament. Further, the point of this bill is to protect employees who, in accordance with the Act, make protected disclosures.
No, it was not David Shearer, but we could go there.
The bill was considered by the Government Administration Committee, and it recommended two changes. The first was the insertion of a new section 6C(2), inserted by clause 6, which states: “An organisation is not required to comply with a request made under subsection (1) if it is not a public sector organisation.” The amendment is designed to make clear that a private sector organisation is not obliged to comply with a request from the Ombudsman for information about the organisation’s internal procedures.
Although I support the bill, I have a concern.
Yes, just the one. My concern is this, and it applies in Ms Dyson’s part of the world. If a public entity, for example a regional council, were to own all the shares in a limited liability company, would this Parliament expect that organisation to behave with moral integrity? I think the answer to that question would be yes.
It is in that context that I support the bill and draw the House’s attention to a situation that has arisen in Canterbury, around the Canterbury Regional Council, headed by one Sir Kerry Burke. Sir Kerry Burke and his band of merry councillors saw fit to own a trading organisation called Target Pest Enterprises Ltd. This company was placed in receivership by the 100 percent shareholder of the company, Environment Canterbury, or ECan. That is fine, except that the regrettable arrangement is that ECan is now refusing to honour payments to creditors, totalling around $7.5 million, including its own debenture of $1.5 million. The point of this is that one of my constituents in Masterton, a small-business man, is facing bankruptcy because of the activities of the regional council and its not doing the right thing.
The problem is this. ECan—essentially Sir Kerry Burke—has decided to stand behind the limited liability arrangements and leave the Target Pest Enterprises directors to face the music. But the plot thickens. There is another Government-owned entity, called AgriQuality—now known as Asure New Zealand. During the life of the last Parliament, headed by the Labour Government—a great friend of Sir Kerry Burke—this Government entity was authorised to buy a million dollars worth of shares in Target Pest Enterprises. Five months later, and the day before the Canterbury Regional Council put its entity into receivership, Asure New Zealand sold its million dollars worth of shares back to Target Pest Enterprises Ltd for the princely sum of $1. In 5 months the Government entity, Asure Quality, managed to lose $999,000 of taxpayers’ money.
Of course it is an outrage, and that is why this bill is so important. It is so important that we get this passed.
Despite this, there were concerns over the solvency of the business, and those concerns had been expressed since 2004 by another Government entity called Audit New Zealand. I contend to the House that this wholly owned subsidiary of the entity headed by Sir Kerry Burke traded recklessly and possibly illegally. The actions of ECan through this period resulted in losses to small businesses, and ECan acted, and continues to act, in a manner contravening its responsibilities under the Local Government Act.
How do members suggest that I can assert that? Let me draw the attention of the House to a letter to a company called Forest Green Ltd, at “27 Normanby Road, Mt Eden, Auckland”, dated 30 November 2005. In part, the letter states: “Target Pest has a significant loan with the ASB bank and we also lease many Quad motor cycles from Dave Anderson Motorcycles, neither of whom have written Target Pest or ECAN guarantees and are satisfied with the Local Government Act protection. The ASB bank would definitely not loan money to Target Pest without this protection. I am very sorry that I cannot provide the written guarantees we discussed however I hope the Local Government Act satisfies any concerns.” Clearly it did not satisfy any concerns, and my constituents are being stretched out on a long piece of wire, because it is very easy for the councillors on the Canterbury Regional Council to hide in deep ratepayers’ pockets while it tries to screw the little guys who are being taken to the wall because of the insolvency promoted by the Canterbury Regional Council.
I think hiding behind a limited liability company is unacceptable behaviour by a local body, and that is why this legislation is so fundamentally important to the business people of New Zealand. That is why I stand here in full support of this legislation.
The second area where a minor change to the Act is being made is in new section 15E(3), inserted by clause 8. The legislation is being amended to include section 30 of the Ombudsmen Act, including a reference in section 30 that makes it an offence to refuse to provide to an Ombudsman the information specified in new section 15E. It applies only to public sector organisations. I am very hopeful that my reading of the legislation is correct and that it will stop what has happened in Canterbury, where the Canterbury Regional Council is hiding behind a limited liability company, pretending there is no issue, sending small people to the wall, and hiding behind the deep pockets of ratepayers to pay endless lawyers in order to avoid its moral responsibility to do the right thing.
I publicly ask this House to call upon the Canterbury Regional Council and Sir Kerry Burke, and to say: “Look, we expect you to do the right thing. If your council has owned this company, you cannot hide behind the limited liability legislation. You should do the right thing and pay your creditors, including the creditors in my electorate who are owed some $750,000.” If it is good enough to pay back the ASB Bank because its accounts are held by the Canterbury Regional Council, then it is also good enough to do the right thing and to—
The ASSISTANT SPEAKER (Hon Rick Barker) Link to this
I regret to advise the member that his time has expired. I draw the attention of members to a ruling by Speaker Algie in 1961 that members must confine themselves to the general principles of a bill as it has emerged from the Committee. We have now had two speeches that have gone well beyond that, and I indicate to the House—
The ASSISTANT SPEAKER (Hon Rick Barker) Link to this
Excuse me, I am just ruling on this matter. I ask members to be mindful. There is no problem about members making comments to the side in support of the bill, but when we get speeches that are entirely about matters completely outside the bill, I tell members that in future I will in fact haul them up and direct them back to its contents.
JOHN HAYES (National—Wairarapa) Link to this
I seek the permission of the House to table a letter from Paul Ash, chief executive of Target Pest Enterprises, to Forest Green Ltd, dated 30 November 2005.
The ASSISTANT SPEAKER (Hon Rick Barker) Link to this
Leave is sought to table a letter. Is there any objection? There is no objection; the letter may be tabled.
Hon PETER DUNNE (Leader—United Future) Link to this
I raise a point of order, Mr Speaker. I am grateful for your reference to Mr Speaker Algie’s ruling in 1961—Speaker’s ruling 116/7—but I also note Speaker’s ruling 118/3 by Mr Speaker Kidd in 1998, where he makes a comment to the effect that “if a bill was taken part by part, thereby generalising discussion in committee, it follows that debate on the third reading will be somewhat broader.” On the face of it, that ruling could be seen to be in conflict with the provisions of Speaker’s ruling 116/7 and, indeed, also of Speaker’s ruling 117/3. It may be time for you, Mr Assistant Speaker, to make a more considered ruling about where Mr Speaker Kidd’s ruling sits in relation to the earlier ruling. It has certainly been my long understanding that the Algie principle is the one that applied—that the third reading debate was a very limited debate about the bill as it emerged from the Committee of the whole House—but it could be argued that Mr Speaker Kidd has broadened that definition somewhat and I think it might be timely for you to give some consideration to the relationship between those two rulings, and whether Mr Kidd’s ruling overturns the earlier one or is subservient to it.
The ASSISTANT SPEAKER (Hon Rick Barker) Link to this
I thank the member for that and I will certainly give consideration to a considered ruling. But I think Mr Kidd would be amazed to find that his ruling was interpreted as allowing debate on some itinerary of global travel by a Speaker’s tour, a company collapse somewhere, and goodness knows what else that we have had thrown in. A third reading is about the bill and the bill itself, but I will take the member’s advice and bring back a ruling.
CHRIS HIPKINS (Labour—Rimutaka) Link to this
I am happy to take a call on the third reading of the Protected Disclosures Amendment Bill. As I said in some of my earlier speeches, fundamentally this bill is about power, the abuse of power, preventing that abuse, or, where it occurs, at least disclosing it. I want to canvass some of the issues I raised during the Committee stage—to sum them up as provided for in Speakers’ rulings.
Since the completion of the Committee stage an issue has arisen that has relevance to this bill. This bill extends the protection of the Protected Disclosures Act to contractors. We had an interesting new example of contractors revealed in the House this afternoon, and that is the purchase advisers employed by the Government in Ministers’ offices. Those people are being engaged as contractors rather than as public servants because the Government said earlier in the year that it was going to pay its press secretaries and political advisers more, but it would employ fewer of them. So as a way of getting around that they have contracted in these purchase advisers. They are making the Government departments pay for them—
That is right. They are making the Government departments pay for them for their political advice in order to get around their earlier commitment to have fewer people working in the Beehive. Of course we now know that they will actually have more people working in the Beehive and they will get around that commitment by making them contractors. These contractors, because of the changes to the Protected Disclosures Act, will now be covered by this legislation.
It is interesting, is it not, that these purchase advisers are effectively going to be spies for the Minister of Finance, because it is on the Minister of Finance’s instigation that these purchase advisers are being engaged. He wrote to departments instructing them—he did not just ask them to consider it—to engage these purchase advisers, and he even went so far as to tell them how much they were to be paid and gave them a list of the names of the people they were to engage. It raises a whole lot of questions around the political neutrality of the Public Service, which the National Party of course said in its pre-election manifesto that it would defend and restore, when the Minister of Finance can now instruct a department to employ purchase advisers who will not be accountable to the chief executive they work for. They will answer only to the Minister, they will be paid for by the taxpayer, and they will not be subject to the standards of conduct and ethics that a normal public servant is. That is outrageous because it is political abuse.
These purchase advisers will be covered by the legislation, and I want to talk a little about what that might mean. They will be covered, so they themselves will be able to make a protected disclosure. So if, in the course of their razor gang slash-and-burn exercise—which, of course, is what we know the Government is employing them to do—they uncover some wrongdoing, they will be able to make a protected disclosure. We support that and we welcome it because it is important that people working in Government are able to make protected disclosures to reveal wrongdoing where it occurs. The fact that these purchase advisers will be on contract makes them no different; they should be able to make a protected disclosure.
But staff who are subject to their prying and their prodding should also be able to make a protected disclosure about them because those people are not going to be subject to the code of conduct for public servants. They will not be prevented from engaging in the party political activities that a public servant is prevented from engaging in, because they will not be covered by the Public Service code of conduct. So if a public servant wants to raise a complaint about abuse of power by one of those purchase advisers engaged because Bill English told Ministers that he wanted them to be engaged—and he wanted them to be engaged because he does not trust any of the Ministers he works with—that public servant should be able to make a protected disclosure. It is interesting to note the list of Ministers who do not have purchase advisers. The brat pack—or the two remaining members of it—for example, do not appear to have purchase advisers. Bill English clearly trusts those. Paula Bennett has to have a purchase adviser—
She may well require more. If public servants are concerned about the abuse of power by one of these purchase advisers they will be able to make protected disclosures under the Protected Disclosures Act, because one of the big changes is that contractors are now going to be covered. I think that is something we would welcome.
We should consider in the context of the legislation some of the issues that a public servant may wish to raise, because the Public Service needs protection now more than ever. With the slash-and-burn going on within the Public Service at the moment there may well be—and I suspect there will be—a lot more reason for public servants to want to make protected disclosures. When the Public Service is cut to the bone, then the accountability and the checks and balances are stripped away in a money-saving exercise. Therefore the potential for the abuse of power is significantly increased, so a public servant may want to make a protected disclosure.
Another issue is that there may be a temptation to cover up mistakes made in the Public Service because of a chronic lack of resourcing or lack of funding. In the health sector, for example, where the National Government’s razor gang are going through and stripping funding and resourcing out, there may well be instances where public lives are put at risk—
—particularly in the aged care industry where people are dealing with very vulnerable older people and the public servants involved need to know that they can make a complaint and that they are not going to lose their jobs. Of course there are other examples of people who need some protection under this legislation and one of the things that this amendment bill does is to extend the protection of the Protected Disclosures Act to the chairpeople of boards. We know it is important that board people have protection under this National Government as well. Look at the case of the Otago District Health Board where there was a revelation of wrongdoing, which National members have talked about. But they do not talk about the guy who fixed it, who was the chair of the board, and who got sacked for his troubles. National members did not like him, they did not like his politics, so they just sacked him. That highlights a weakness with the Protected Disclosures Act—although it protects the disclosure itself, it does not protect the people who are then responsible for fixing the problem. A chairperson who uncovered some wrongdoing and wanted to make a protected disclosure would be covered by the protection of this legislation. On the other hand, if somebody else made a protected disclosure and the chairperson, who had been unaware of the situation, then fixed it, the Government will sack him or her. Because that is what this Government does; if there is any wrongdoing, this Government always sacks the people who fix the problem.
It is completely bizarre.
I will talk about some of the other people who might be covered by the Protected Disclosures Act. I talked a little bit about ministerial office staff and the fact that they could be covered by this. For example, if a Minister travelled to India to promote his or her own business interest, using a diplomatic passport to do so, or failed to disclose that a company he or she was associated with was being investigated by the Serious Fraud Office, and a whistleblower in his or her office wanted to raise a concern about that, that person would be protected by the Protected Disclosures Act.
That will be helpful, because these are matters of public accountability: it is public money and it is about the abuse of power. People should be protected if they are going to disclose such matters. Of course the problem is that even if that kind of abuse of power is disclosed, this Government does not do anything about it. Even when John Key says three times that the Minister is on his final warning, he still does not get sacked. Even when John Key gives him a “bollocking” in public and calls him “stupid”, he still does not get sacked. I am of course talking about Dr Richard Worth, who abused his position to promote a business in which he had an interest. Yet this Government and this Prime Minister are not doing anything about it.
Labour supports the enhanced provisions of the Protected Disclosures Amendment Bill. In fact, we introduced them. This bill is yet another bill that was introduced by the previous Labour Government—the National Government cannot seem to come up with any of its own. Government members are too busy flying off around the world feathering their own nests and promoting their own business interests to come up with any legislation of their own. I look forward to a day when we can stand up and debate in this Chamber what the National Government wants to do, rather than going back over the legislation introduced by the previous Labour Government. It is good legislation, so I commend it to the House, but I would like to see some evidence that this Government is actually doing something.
KANWALJIT SINGH BAKSHI (National) Link to this
It is my honour to stand in support of the Protected Disclosures Amendment Bill. The bill is designed to give Ombudsmen an enhanced guiding, reviewing, and investigating role in relation to the disclosure of serious wrongdoing, with the Office of the Ombudsmen facilitating a collaborative cross-agency approach. When the Protected Disclosures Act 2000 was reviewed under section 24 of the Act in 2003, it brought to light some evidence of delays, inconsistencies, and other difficulties in using the legislative procedures properly, partly because whistleblowers and some organisations were unsure how to go about them. The review also noted that there has been a degree of confusion about various definitions, a lack of communication with whistleblowers, a lack of confidentiality and protection of identity, and the lack of appreciation that Ombudsmen can assist.
This bill gives the definition of “employee” to include former employees, homeworkers, contractors, and people concerned in the management of the organisation. The definition of “public official” is a person who is an employee of a public service organisation or is concerned with the management of a public service organisation. Is there any protection for mistaken judgment of serious wrongdoing? This bill states that if a person believes on reasonable grounds that the information is about serious wrongdoing but his or belief is mistaken, then the disclosure will not lose the protection under the Act. The bill also provides many procedures and technical amendments to enable the Ombudsmen to better exercise power under the Act. This bill redrafts and clarifies the power of the Ombudsmen to request and advise.
The Ombudsmen can also ask for information from both private and public sector organisations. We believe that both public and private sector workers have the right to certain protection. Certainly, there is no protection available to an employee who discloses in good faith in an appropriate manner a serious wrongdoing, nor is there any general statutory immunity for civil or criminal liability. It is important that the employees of all organisations—private or public—are in a position to make protected disclosures about serious wrongdoing in or by their organisations; not to make this protection available to employees of private organisations is condoning wrongdoing in the private sector and could be putting the public at risk.
National supports the broad approach of the Protected Disclosures Act and supports any efforts to improve its operation and administration. National accepts that with the better tools available through the amendment, Government agencies should be able to respond in a more coordinated and effective manner to holding the Government to account. Protecting whistleblowers is not just a matter of legislative change; ongoing operational improvements are also important. We recognise that when a law is changed there are important changes to the process that then make the legal changes relevant. We recognise that silence is not in the public interest. We want the public to have confidence in the process of making protected disclosures. I stand here to support the bill. Thank you.
Hon RUTH DYSON (Labour—Port Hills) Link to this
It gives me great pleasure to speak in the third reading of the Protected Disclosures Amendment Bill, which is another Labour Government bill. It is delightful to see the National Government, yet again, supporting legislation from its predecessor in Government. One does wonder what we would be doing if Simon Power were not in the House and we got to the end of all the Labour Government bills that have been brought forward into this Parliament. All we have seen is the former Government’s bills and Simon Power’s bills. I am glad that Simon has been so diligent, and shown that at least somebody in that Government can do some work.
In fact, it was so obvious during the second reading of this very bill that it was a Labour bill. The National members got up and started claiming credit for this amendment bill, then we realised that David Parker’s name was still on the bill. They had not actually got round to taking David Parker’s name off the bill during the second reading. Either way, it is good to have cross-party consensus on a Thursday afternoon for protecting these improvements to the original legislation: the Protected Disclosures Act 2000.
The bill does four very straightforward things: it makes it easier for whistleblowers to bring serious concerns of wrongdoing to light, which is a very important provision; it makes it easier for organisations to investigate those concerns and allegations effectively; it enhances the role of the Ombudsmen; and it extends the definitions of “employees” to include volunteers, and also, as my friend and colleague Chris Hipkins pointed out, to include the new Public Service - paid contractors who are acting as political advisers in the offices of National-Act Government Ministers. They are political hacks appointed by the Minister of Finance through the Minister’s office and paid for by the Public Service. This amendment legislation will now cover them, as well. This bill is well worth supporting, not just because of that latter provision that I mentioned, but for many reasons. I commend its speedy progress to the House.
SIMON BRIDGES (National—Tauranga) Link to this
It is very good that I rise to speak on the Protected Disclosures Amendment Bill; I am very excited about it. It is a great bill. I was not going to be allowed to speak, but I persuaded the National whips to let me because there is so much to say about this bill. It really is an important part of the democratic jigsaw puzzle that makes up this country. The bill is all about being an open and transparent country, not a country that hides behind things and lives in the shadow of fear. I strongly disagree with David Parker’s earlier comment that the previous Government had so many more important bills than this one to speak on and to push through this House. The Protected Disclosures Amendment Bill is important. It deals with significant improvements to the protected disclosures regime that this country has had since 2000. The bill is all about improving that regime.
In this contribution to the third reading I want to, firstly, talk about the background to the Protected Disclosures Act 2000 and this amendment bill, and, secondly, deal with a few miscellaneous comments made by members earlier, particularly by Labour members. It seems to me that they are talking of conspiracy and secret agendas on National’s part. That is absolute rubbish. Thirdly, I want to speak to the broader context of this bill and what has been happening internationally on the issue of protected disclosures, or whistle-blowing, as it is known in this country and in many others in the Western World. Finally, if there is time, I would like to speak on the substance of the bill and its various clauses.
Master Hipkins! The background to the Act, as I understand it, arose out of the Neil Pugmire saga in Wanganui. He was a little like his name—a pugnacious man. He stood up and was counted, and, eventually, as a result of that case, we got a good law in 2000.
The Act was a good start, and it was a good step down the road. I accept that the previous Labour Government reviewed the Act in 2003. It asked Mary Scholtens, a prominent Wellington QC, to do the review. That review established quite clearly the need for improvements in relation to the legislation we already had. It was interesting that her report made it quite clear that the Act was a relatively underutilised and little-known law. This bill before the House is an improvement. I hope it will see protected disclosures made more often, in a safer and more open environment. Nevertheless, even if we do not see a greater pick up in the number of people coming forward with complaints of serious wrongdoing, this kind of law performs an important symbolic role in our nation. At the very least, it gives people the ability to stand up and be counted in their workplaces when they see serious wrongdoing.
As I said, there was a review and then we went through a slow select committee process.
Todd McClayThe member sitting beside me makes a good point. The Government Administration Committee was chaired by Shane Ardern—
—a great MP, a great farmer, and a Kiwi battler. The deputy chair was Darien Fenton. I do not know Ms Fenton well, but I understand she is a good member. The other members were Brian Connell, Harry Duynhoven, Sandra Goudie, and the Hon Dover Samuels. So it was a high-powered, first-class select committee. I give credit where it is due: Labour introduced this bill and started the process, but now it is National that is closing the deal and is bringing this good law to its rightful place.
As I said before, I note some of the contributions made to the debate, particularly by Labour members. We have heard from Grant Robertson, who has again, as he did in the Committee stage, gone on about job cuts. I admire the way that in every single speech that member makes in this House, no matter what it is on, he links the issue back to job cuts in the Public Service.
Then we heard from Chris Hipkins, who continued the Labour Party fetish with the bureaucracy and the Public Service. [ Interruption] You know, it is a fetish. I do not deny in any way that the public sector in this country is significant and makes a valuable contribution to this nation, but I say to Chris Hipkins and Grant Robertson that they ignore a lot of other people in this country. Maybe that explains why Phil—“Phil-in”—Goff is at 3.7 percent, or whatever it is, as preferred Prime Minister, because he and the Labour members forget the other people.
They forget the hairdressers; they forget the teachers; they forget the mechanics; and they forget the plumbers in the provinces. The National Government will not do that. This bill applies to many others, other than just the public sector that Grant Robertson represents.
We have had some valuable contributions. Keith Locke presented a thoughtful set of arguments. Te Ururoa Flavell, a colleague of mine from the beautiful Bay of Plenty, made a valuable contribution. John Hayes made some important points in a quite hard-hitting speech. But I am disappointed that all the Labour members can do is continue their fetish with the bureaucracy and the public sector to the absolute neglect of anyone else in this country from Cape Reinga to the Bluff.
As I turn to the context of this bill, I say that we are not the first and we will not be the last nation to bring in a protected disclosures regime. This House—the thoughtful members like Te Ururoa Flavell and Maurice Williamson, who is sitting next to me—will, I am sure, be interested to know that many other Western nations have brought in very similar legislation. It started in America, in California, with the interesting case of Jeffrey Wigand, who was the inspiration for the character in the movie The Insider with that great Kiwi actor Russell Crowe, who I hear Chris Hipkins styles himself upon. It was about some classic whistle-blowing where companies knew the addictive nature of and the carcinogenic ingredients in cigarettes, and Jeffrey Wigand had the courage to stand up and be counted. Subsequent to that event, California and then a host of other states in the United States introduced protected disclosure laws. We have seen that in many other nations around the world, and there is similar law throughout Europe. I brought that to the attention of this House, as it is an interesting trend that the Western World has embarked upon.
Finally, this bill does two very important things. It enhances the role of the Ombudsmen. In essence, that is a very important thing. It allows those Ombudsmen—
The ASSISTANT SPEAKER (Hon Rick Barker) Link to this
I regret to advise the member that his time has expired.