Privilege — New Zealand Post Limited

I move, That the House take note of the reports of the Privileges Committee on the question of privilege referred on 28 February 2002 in relation to information given by New Zealand Post Limited to the Finance and Expenditure Committee, and on three questions of privilege concerning disclosure of select committee proceedings. New Zealand Post, through its international consulting arm, Transend, was helping to manage the South African Post Office. In 2001 the South African Government reviewed the performance of the South African Post Office, using an international investigative and forensic firm called Kroll Associates. Transend’s role in the South African Post Office was part of that broad review.

On 7 November 2001 the chief executive officer of New Zealand Post, Mr Elmar Toime, appeared before Parliament’s Finance and Expenditure Committee as part of the 2000-2001 financial review of New Zealand Post. Arising from oral questions at the committee hearing of 7 November, the committee resolved to forward to New Zealand Post a written question relating to the report that Kroll Associates had made for the South African Government on the South African Post Office. The written question, submitted by the Hon Mr McCully, who was a member of the select committee, read as follows: “Does New Zealand Post have a copy of the Kroll report or a summary thereof and can it be made available to the Select Committee?”

Mr Toime replied, on behalf of New Zealand Post: “As orally advised by the Chief Executive to the Committee, New Zealand Post does not have a copy of the Kroll Report. This report was commissioned by the South African Government and covers many areas not involving New Zealand Post. New Zealand Post does not expect to receive a copy.” Thus orally, and in a written reply to that written question, New Zealand Post declared that it did not have the Kroll report.

In February 2002 Mr Hide MP, a member of the Finance and Expenditure Committee, released to the media a copy of a report that he declared was the Kroll report to the South African Government. As a consequence, Mr McCully wrote to the Speaker of the House on 11 February 2002, as he was entitled to under the Standing Orders, to raise as a matter of privilege that New Zealand Post had misled the committee, because, in Mr McCully’s view, it did have a copy of the Kroll report at the time of its appearance before the committee, and at the time of the written question.

The Speaker ruled as follows, on 28 February 2002. I quote from Appendix B of the report before the House: “For a matter of privilege concerning a deliberate attempt to mislead a committee to be made out, misleading information must have been given and there must be evidence pointing to the misleading information having been given deliberately. On the face of it, there is evidence in this case that the information given might be misleading—the company said it did not have a copy of a report, when it apparently did have a copy of a draft report. It is for the Privileges Committee to determine whether that is actually misleading.

“On the issue of whether any such misleading was deliberate, the fact that this answer was given in writing after notice is relevant. It is a more considered process than an oral answer at the committee, given without benefit of reflection and reference to company records. If the answer were misleading, it could well be considered to have been deliberate.

“I therefore feel that a question of privilege has been made out. However, a Speaker is not obliged to hold that a question of privilege arises just because the ingredients of a contempt exist. If the matter has been, or could be, otherwise cleared up, the Speaker can, as a matter of discretion, rule that no question of privilege exists. One of the reasons that I sought the advice of the Finance and Expenditure Committee was to establish whether this matter would be better explored as part of the financial review. I do think that that would probably be the most satisfactory way to proceed, but I take the member’s point that he is entitled to a determination of this matter by the Speaker within a reasonable period. … This question consequently stands referred to the Privileges Committee.”

Consequently, after that ruling, the Privileges Committee in the last Parliament, chaired by the Hon Margaret Wilson, was seized of the matter. Consideration of the matter was not completed by that committee, and it was taken up by the Privileges Committee established for this Parliament on 13 February 2003. The previous Privileges Committee had decided to defer its consideration until the Finance and Expenditure Committee had reported on its financial review. In the meantime, the general election of 2002 intervened.

The present committee considered the key documents before it on the narrow question on which it was called to decide: had there been a deliberate attempt to mislead? On 18 February 2002 Mr Ross Armstrong, the then chairman of New Zealand Post, wrote to the Finance and Expenditure Committee on the issue. Of importance to the Privileges Committee in making its finding was the evidence put forward on whether New Zealand Post had a copy of the Kroll report.

The chairman of New Zealand Post advised as follows. “On 3 July 2001, the Independent Auditors provided Transend with a section of a document bearing the full title: Draft Preliminary Report of the Independent Auditors to the Minister of Communications of the Investigation into the Financial Affairs of the South African Post Office. … The section we received concerned itself with one element of the investigation, the Strategic Management Partnership. It also focused solely on financial performance, and ignored the other targets in the contract with Transend. This is the document Mr Hide has provided to the committee. …

“No final copy of either the full report of the Independent Auditors or of the section of the Draft Preliminary Report we received has been seen by New Zealand Post or by Transend. It is not known if a final report has even been given to the South African Government.” He concluded: “If the request had been made during the Committee meeting with New Zealand Post to explain the status of the investigation by Kroll Associates, we would have described the situation fully. The Draft Preliminary Report would of course need to be read in conjunction with Transend’s response.”

In a statement to the Finance and Expenditure Committee on 6 March 2002, which is contained in Appendix D of the Privileges Committee’s report, Mr Elmar Toime stated as follows: “Out of respect for this committee, and because of my concern for what has occurred, I should like to take the opportunity to provide the Committee with an explanation of the events that led to my drafting the reply in question. …

“On 1 July 2001 Transend received from Kroll Associates a document entitled Draft Preliminary Report of the Independent Auditors to the Minister of Communications of the Investigation into the Financial Affairs of the South African Post Office. …

“While the document was described as a draft preliminary report, an examination of its contents revealed it was principally a series of issues concerning Transend encompassing transcripts of conversation between persons relative to matters addressed. The document was identified as part of a drafting process, was labelled as such, and was forwarded for comment. …

“If the written reply to this Committee has been perceived as inaccurate in any way by the Committee or any of its members, then I express my regret that that has occurred. I believe that the reply is entirely accurate and I can unreservedly assure the Committee there was no intention whatever to mislead or hide anything from it.”

Mr Toime wrote further to the Attorney-General, the Hon Margaret Wilson, as follows. This is contained in Appendix E of the Privileges Committee’s report: “With the advantage of hindsight, I deeply regret the brevity of my written reply. I saw it in the context of the 28 written questions in total being asked of the company at that time by the Select Committee. I regret the answer because it has given some MPs the impression that the company was attempting to hide something when in fact it was not. I should have said we had received and responded to a draft preliminary report from Kroll, but in my mind I did not define what we had received as ‘the Kroll Report.’”

At this time, I advise the House that the Privileges Committee did not have the benefit of hearing Mr Toime, who I believe is in England in another position. At the request of the Privileges Committee the present chairman of New Zealand Post, Mr Jim Bolger, appeared before it, accompanied by the acting chief executive officer. As the report states at page 5, “The Chairperson of New Zealand Post, Rt Hon Jim Bolger, reiterated the sentiments expressed by the past Chief Executive and apologised on behalf of New Zealand Post if there was a perception that the company had misled Parliament.” Furthermore, it states: “New Zealand Post agreed that a memorandum would be circulated to senior management to reinforce the importance of the parliamentary scrutiny role.” That is in the Privileges Committee’s report as Appendix F.

On the evidence before it, and after consideration by all members of the Privileges Committee, the committee found that our recommendation to this Parliament would be that we accept New Zealand Post’s apologies. Technically, the company did not give false answers to any questions from the Finance and Expenditure Committee. However, we believe that New Zealand Post should have been more forthcoming and helpful in answering the committee’s question. There is no excuse for being less than fully open and frank with the committee. Having found so, and having found that technically on the evidence New Zealand Post had answered accurately, our conclusion is that we recommend that no further action be taken on this question of privilege. But we stress the importance of all State-owned enterprises being open and frank with Parliament within the constraints of commercial sensitivity.

I have come to the House to speak on this report because of my concern about its findings, and, more particularly, my concern about the culture of dishonesty that now suffuses public agencies in New Zealand—and it starts from the top of the Government. I believe that the Privileges Committee is likely to play a greater role in the next few years than it has—

💬 Hon Dr Michael Cullen: I raise a point of order, Mr Speaker. The turn of phrase that has just been used, “the culture of dishonesty” that “starts from the top of the Government”, can have only one meaning in that context. Dr Mapp, who was one of those who unanimously signed this report, agrees with it. That phrase must refer to the Prime Minister. I suggest to you that that accusation is totally out of order.

💬 Mr SPEAKER: The accusation that a member of this Parliament is dishonest is out of order. I ask the member to assure me that he was making no reflection on any member of Parliament.

I cannot give that reassurance.

💬 Mr SPEAKER: All right. I ask the member to withdraw and apologise for that comment.

I withdraw and apologise. The Privileges Committee is likely to find that it will become busier, because we have a culture in the Government where half-truths, evasions, and straight-out lies have become acceptable—

💬 Mr SPEAKER: The member cannot—

💬 Hon Dr Nick Smith: [Interruption]

💬 Mr SPEAKER: Will the member please leave the Chamber. I have warned him once, and he will now go.

💬 Hon Dr Nick Smith: Stop protecting the bloody Prime Minister.

💬 Mr SPEAKER: The member will return to his seat or he will be named.

Hon Dr Nick Smith withdrew from the Chamber.

Debate interrupted.