The Dominion-Post reports that a senior manager in the Ministry for the Environment has lost her job after just three days on the basis of a "conflict of interest". The conflict? Her partner is John Key's chief press secretary. This had been disclosed, but was not initially considered an impediment to her appointment. However, the State Services Commissioner Mark Prebble was subsequently called in to help MfE's COE "exercise his best judgment in the interest of the department" and fire her.
Like DPF, I think this is an utterly vile act of political retaliation which undermines public service neutrality. The Public Service Code of Conduct requires public servants to be politically neutral so as to maintain the confidence not just of the present Minister, but of future Ministers as well. In practice, this means restrictions on political activity and on public comment on policy in their area. It does not and should not mean restrictions on a public servant's personal relationships - if information leaked that way it would of course be misconduct, but public servants are trusted to act with professionalism and integrity. This shouldn't change depending on the political affiliation of your partner, or for that matter of your Minister.
To approach it from another direction, the very idea that "sleeping with the enemy" is a conflict of interest implies that the political enemies of the government of the day are enemies of the public service. And this runs contrary to the very idea of political neutrality.
Finally, I should add that this sort of political interference in employment decisions runs totally counter to the duty of CEOs to act independently in such matters, and to the whole tradition of public service independence. Way back in 1912, Parliament removed the ability of Ministers to hire and fire within their departments, precisely to prevent cronyism, patronage, and the punishment of public servants for backing the "wrong" party. Instead, they vested employment authority in a Public Service Commissioner. Twenty years ago the State Sector Act devolved that authority to departmental CEO's, but the principle is the same: in order to ensure an independent and neutral public service where appointments are based on merit rather than political affiliation, Ministers must have no part in such decisions. But it seems that the bullying and paranoid Minister for the Environment has ignored that as well.