Thursday, April 07, 2022

The abuse of secrecy clauses

The Ombudsman has released a case note today on a request for polling data gathered by an IRD contractor. The contractor in question was Colmar Brunton, the polling data was highly controversial information on political leanings IRD had inappropriately asked the firm to collect. Someone - presumably Stuff? - had asked for the information under the OIA. IRD initially refused the request under its (old) secrecy clause. The Ombudsman's report focuses on a procedural problem - IRD had decided to refuse without ever viewing the information, in violation of the precedent set by Kelsey v Minister of Trade. Along the way, it also appears that they had ordered the contractor to delete the data when it became publicly controversial, in violation of the Public Records Act, right before the SSC announced an investigation, which looks a lot like trying to destroy evidence of wrongdoing (fortunately the data could be recovered, though it seems IRD initially tried to lie about that as well). Which all looks pretty dubious. But my real problem here, which wasn't addressed by the Ombudsman because it wasn't necessary to, was the use of the secrecy clause in the first place.

Section 81 of the Tax Administration Act (and its successor, section 18) existed for a specific purpose: to protect people's private information, and to protect the integrity of the tax system. Here, it has been used for another purpose: to cover IRD's political arse and prevent public criticism. It is a perfect example of how these clauses are abused, and why we need to repeal or significantly limit them (note that this is perfectly consistent with retaining criminal penalties for staff who abuse their positions and release such information without authorisation).

In this case, I would suggest repeal. The interests protected by the secrecy clause are already well-protected by the existing withholding grounds of the OIA (namely privacy, confidentiality / commercial sensitivity, the maintenance of the law, and potentially the rarely-used " substantial economic interests of New Zealand" clause). While many of those grounds are subject to a public interest test, the established public values around the privacy of people's tax information and the need for accurate disclosure would make that virtually insurmountable. As for the rest, if IRD thinks a particular disclosure would undermine the tax system, then they can argue that to the Ombudsman. Because it is clear from this example that they massively overestimate that risk and consistently conflate it with their own political interests and job security. And that is not something the law should enable.

Correction: The request was by Eric Crampton.