A very bad report

I've spent some time reading the State Services Commissioner's investigation into the engagement of Clare Curran by the Ministry for the Environment [PDF], and it is a very bad report indeed, in more ways than one. While Erin Leigh's allegations of a political appointment were not substantiated, the report harshly criticises the Ministry for the Environment for failing to use a proper tender process for the appointment, and for failing to properly identify and manage the potential conflicts of interest arising from the manner of Ms Curran's appointment (at the same time, it is also clear that Ms Curran did not bring her politics into her work, as the National Party has tried hard to imply; she behaved professionally. The failing was on the part of MfE in not ensuring that the appointment was seen to be on merit, and in failing to quash rumours that Curran was a political appointee). Given this, it is no surprise that MfE Chief Executive Hugh Logan decided to resign. He had failed to properly manage his Ministry, and failed to ensure that the values of the public service were upheld. For that, his head had to roll.

However, there's another sense in which it is a bad report, and that is that it exonerates Climate Change Minister David Parker for his grossly improper suggestion that Curran be hired, and takes the position that it is perfectly acceptable for Ministers to intervene in employment decisions in this way. It is not. Our public service is founded on two principles: political neutrality and appointment on merit. In order to protect these principles, Departmental Chief Executives are legally required to be independent in their employment decisions. While a Minister has no formal power to hire and fire, the need to maintain a good working relationship means that even a suggestion can compromise this independence, and ultimately the values of the public service itself. And that applies even to apparently innocent and well-intentioned suggestions like Parker's. For everyone's sake - their own, their chief executive's, the poor employee who ends up being tarred as a political appointee's, and the public's, whose faith in the public service is undermined - it is better that they simply not make such suggestions at all.

Utterly unacceptable

Yesterday we learned that, contrary to reports last week, the Ministry for the Environment did not put the contract won by Labour Party activist Clare Curran out to tender, but hired her directly in violation of normal procedures. That's bad enough, but tonight TV3 dropped this bombshell:

Erin Leigh worked at the Environment Ministry in 2006 on climate change issues - but she resigned suddenly over what she calls inappropriate political interference by the minister.

Parker suggested in 2006 that the ministry hire labour party activist, Clare Curran to develop climate change strategies.

"She was there representing David Parker's personal political agenda - it was highly unusual, my advice was to push back on the minister and it could be illegal," Leigh says.

Leigh says her warnings were ignored, and she resigned in protest before Curran started.

[...]

She says her boss, Neal Cave, also resigned over the political meddling.

If these allegations are substantiated by the State Services Commission, David Parker should be sacked from his portfolios immediately. Suggesting someone's name for a position is grossly improper, but interfering directly in an employment decision is utterly unacceptable and can not be tolerated. Parker may be clever and competant, but if he can't understand the difference between a public servant and a political operative, and insists on treating his department like a private fiefdom, then he is simply unsuitable for any Ministerial position.

Grossly improper

For well over a century now, New Zealand has been blessed with a professional, politically neutral public service, which faithfully serves the government of the day regardless of their ideological bent. A key underpinning of this has been the independence of the public service in employment decisions. Public servants are hired and fired not by Ministers, but by Departmental Chief Executives, a move designed to ensure appointment on merit and prevent cronyism, patronage, and political retaliation. But recently, this has come under threat. First, there was the sacking of Madeleine Setchell on the basis of her partner's political views - an act found to have been simply wrong by a subsequent investigation by the State Services Commission. And now it seems it has a sequel, in the hiring of Clare Curran. Unlike some, I am not interested in Curran's political views - such conflicts of interest are routinely managed within the public service, and pose no real problem. Instead, the problem is how she was hired: her name was originally floated by the acting Minister:

Mr Parker told reporters he had suggested Ms Curran's name to the ministry during a discussion on what communications help it needed.

He had suggested her because "I knew her to be very able in these areas".

Mr Parker said he had known Ms Curran long before she joined the Labour Party through her work with her company Insight Communications.

"I didn't recommend who they should hire and I wouldn't do that," he said.

But regardless of how it was phrased, this is still grossly improper behaviour from a Minister. Chief Executives have a statutory duty to act independently in employment matters, and Ministers should respect this. While the contract was put out to tender, and Curran was appointed on merit, suggesting a specific individual for a position could be seen as an attempt to influence the employment process, and this should be avoided. It is, bluntly, simply not a Minister's business who works for "their" department, and they should keep the hell out of it.

A non-denial denial II

When the Greens confronted the government about their shameful position at the Vienna climate change talks, Climate Change Minister David Parker began his non-denial denial by quoting the opening lines of the New Zealand delegation's plenary statement at the conferance:

First, I would like to reiterate New Zealand’s readiness to take on new quantatative commitments to reduce greenhouse gas emissions...

The statement was subsequently tabled in the House, which was a mistake, because it shows just how deceitful the government has been on this issue. The lie behind Parker's claims is laid bare in the final paragraph where our representatives stated:

there would be little sense in trying to finalise mitigation ranges at this meeting.

So, the Greens and NGOs were right - we opposed the indicitive 25% - 40% target range, hardly what you'd expect from a "100% pure", "clean and green" country pursuing carbon neutrality. As for Parker, while he hasn't technically mislead Parliament (in the same way that Bill Clinton didn't technically lie when he said "I did not have sex with that woman"), he certainly did his utmost to give Parliament and the public an utterly misleading interpretation of New Zealand's position. Which simply confirms it: Labour is two-faced on climate change.

A non-denial denial

The Greens confronted the government about their shameful position at the Vienna climate change talks in Parliament yesterday, asking whether they could

confirm that New Zealand’s delegation to the United Nations climate change talks in Vienna tried to block non-binding emission reduction targets of 25 to 40 percent for industrialised countries; if so, was this delegation acting on his instructions or instructions from a member of the Cabinet?

(Corrected gender to match what was actually read out)

In response, the Minister denied the claims, accused NGOs of getting it wrong, and then said this:

I can confirm that the representatives of the New Zealand Government explicitly noted that we are willing to take on binding targets.

But note what's missing here: any mention of the level of those targets. While supposedly denying that the government had opposed the 25% - 40% reduction target, Parker was in fact issuing a "non-denial denial", which carefully circumvented the facts at issue and denied only by implication. Which as Green co-leader Russel Norman points out, is as much as an admission of guilt. If they'd actually supported the target, Parker would have simply said so, and that would have been the end of the matter.

So, to reiterate: the government are two-faced, lying, ratfink bastards. And if we want real progress on climate change, the only way to get it is to ensure that the next government is utterly beholden to the Greens.

Climate change: all down to agriculture

What are the variables in New Zealand's climate change policy? There's a candid assessment from the Minister in the Local Government and Environment Committee's annual review of the Estimates for Vote: Climate Change [PDF]:

The volume of rainfall in catchment areas from now until 2012 will be an important factor in determining our future liability. The Minister was reluctant to indicate when our emissions are likely to plateau, as this will largely depend on future agricultural outputs.

(Emphasis added).

This is a point I've been making for some time. While we could conceivably meet our rather lax short-term goals (or we could have, if we'd acted earlier rather than sitting on our hands for a decade), we are simply not going to be able to make larger cuts in the long term as long as agricultural emissions are allowed to grow. And while there's some good news on that front around nitrification inhibitors, the core problem of enteric methane emissions still has not been dealt with. Unless it is, there's no hope of reaching a goal of a 50% reduction in emissions by 2050, let alone carbon neutrality.

What can we do about this? In the short-term, we need to throw more money at research. The amount involved is relatively small - an extra $3 million a year would give those working on methane everything on their wish-list. Unfortunately, those responsible for the problem - farmers - are unwilling to pay to clean up their mess, and last time the government suggested it, they drove a tractor up Parliament steps. So much for rural "self-reliance".

In the long-term, I think it is vital to internalise the externality and ensure that farmers pay for the costs they impose on society. A simple per-head tax on agricultural animals based on their average emissions is the easiest solution. That will at least ensure that the cost of emissions is factored into their decision making, and it will ensure that the cost will lie where it belongs: with the polluters, rather than those they free-ride off.

Parker exonerated

The Companies Office has completed their investigation of the allegations against David Parker, and the Crown Solicitor has concluded that there is no basis for prosecution. In the case of the key allegation - that Parker falsely stated in several annual returns for a company that he had gained the consent of all shareholders for the company not to be audited - the Crown Solicitor concludes that it cannot be proved even to a prima facie level, and that everything was above board. The three shareholders had or almost certainly had consented to the first three returns, and following the bankruptcy of Parker's business partner Russell Hyslop, the Official Assignee had consented and then eventually waived their future rights. It is unclear whether this waiver was actually legally effective, but it is sufficient to let Parker off the hook; in order to be a crime, a false or misleading statement must be known to be false or misleading.

A subsidiary invesigation of two other companies found a number of minor paperwork offences for which no-one is ever prosecuted and which are normally settled by paying a late fee. These were not considered sufficiently serious to justify prosecution.

Down in the sewer they are already muttering darkly and suggesting that this is another example of a Labour Minister being let off - a line surprisingly echoed by DPF - but having actually read the report, this isn't a refusal to prosecute, it's exoneration. I expect Parker to be back in Cabinet ASAP, and given these findings, I don't think there's any impediment to him resuming his former duties as Attorney-General.

On the minus side, this means I just posted off an OIA request to the wrong Minister. Bugger.

Update: I see ACT is also wallowing in the sewer, claiming that there are now "two laws" and that "business laws now mean nothing in New Zealand if you're a Minister in Helen Clark's Government". To the contrary - two laws would be persuing a groundless prosecution or prosecuting for offences that no-one else is ever prosecuted for, simply because they are a government Minister.

What does it mean for the portfolio?

One of the things that has been overlooked in the departure of David parker is what it means for his portfolios - and particularly (because I'm interested in it) the climate change portfolio.

For those who haven't been following it, climate change policy is currently undergoing a major review, sparked by a reassessment which saw our projected balance of units during CP1 plummet from a healthy surplus (allowing us to sell carbon credits on the international market) to an estimated 36 MtCO₂e deficit. Since then, further worries about deforestation have seen that deficit grow to around 60 MtCO₂e. This caused the government to throw out its entire climate change policy (and notably the carbon tax) and effectively start again with a blank sheet of paper.

Officials were supposed to report back to their Ministers on March 3rd with new policy options, and these were supposed to be hashed out into a coherent whole by a Ministerial Reference Group consisting of the Ministers of Finance, Agriculture, Forestry, Energy, Transport, Environment, Economic Development and Climate Change. The core of the resulting policy was supposed to be presented to Cabinet on April 3rd - less than two weeks away. Parker's sudden departure is likely to have thrown this whole process up in the air. And while the portfolio has been reassigned to Pete Hodgson, who has handled it before, his responsibilities as Minister of Health (a very heavy workload portfolio) may prevent him from paying it the attention it deserves. The change in Ministers may also result in a change in policy; previously, Parker had indicated a willingness to explore some new options (notably, using the RMA in the place of a national-level economic instrument, and actually doing something to promote efficiency gains in transport for once). The first of these was rejected during Hodgson's tenure, and the latter never really considered - and they may now fall by the wayside again, leaving us with no effective policy whatsoever to reduce or limit emissions just two years out from the start of CP1.