Fran O'Sullivan on business

Business analysis and comment from Herald columnist Fran O'Sullivan

Fran O'Sullivan: Heatley's classic sense of entitlement

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Housing Minister Phil Heatley has been excused by John Key as being merely 'sloppy' and 'stupid'. Photo / Glenn Jeffrey
Housing Minister Phil Heatley has been excused by John Key as being merely 'sloppy' and 'stupid'. Photo / Glenn Jeffrey

John Key should have sacked Phil Heatley the moment he found out the disgraced former Cabinet minister had used his ministerial credit card to buy booze for his table at the National Party's annual conference at AMI stadium last August.

Documents released by Key himself show Heatley justified the $70 expenditure by signing a claim in his corporate card reconciliation form that the amount was for "dinner" for the "minister and his spouse".

The accompanying credit card receipt attempted to back up this sham by saying the $70 was for "food and beverage" for the minister and his spouse.

In fact, it was for a couple of bottles of wine for his table at the National Party's annual bash.

By any stretch of the imagination this is not official business, even though Heatley's private secretary counter-signed the claim.

Key has attempted to excuse Heatley's behaviour by portraying him as sloppy, untidy, stupid and careless. The former minister may be all of those things. But he had also been given a blunt warning the previous month by a Ministerial Service manager that due to the scrutiny credit cards attract, "we would like to remind you that all records are open to review" and should comply with the five expenditure principles of the Ministerial Handbook.

This was after he had put expenses from a family holiday and movies onto the plastic. But the expenditure principles are crystal clear. Expenditure must be reasonable for the circumstances and "able to withstand taxpapers' scrutiny. It must also be for official ministerial purposes only, properly documented and supported by tax invoices or receipts, able to withstand audit scrutiny and represent value for money and cost-effectiveness.

Despite this, Heatley went on to charge up $70 for the wine and other dubious expenditure (since reimbursed) including $107.50 for a meal at Wellington's

Shed 5 and $69.95 for a wallet that was part of a $549 charge at Wellington's Bags of Difference.

The Prime Minister - who is also responsible for Ministerial Services - should have cited the prior warning by his officials as the reason why he was sacking Heatley. But he didn't.

The timeline is telling. Earlier this week, Heatley and his press secretary Nick Bryant were making light of the affair within the cloistered confines of the parliamentary press gallery, Bryant even going so far to pull a stunt by cutting up Heatley's credit card in the offices of the Dominion Post , which broke the original story. By Wednesday, the joke was over. Key - who gave a polished performance at Business NZ's "back to the grindstone" party that evening - was clearly on tenterhooks, knowing news media were about to focus on the clear discrepancy.

By 9pm, it was obvious Heatley was on the slip when Bryant was suddenly called back to the Beehive from Arbitrageur restaurant to prepare for a potential resignation.

Heatley's subsequent statement was blatant spin. He claimed not to be as familiar with the rules as he should have been and had failed to "live up" to his own standards. He went on to say that after closer inspection of his accounts he had found a new error. He had charged the two bottles of wine to his account as food and beverages when there was no food included. He accepted this could be "viewed as an inaccurate representation of the expense".

This is a classic red herring. The real issue all along has been the false claim that the $70 was for dinner for him and his wife while on Ministerial business when it was for booze for a National Party knees-up.

The fact the Prime Minister's office released the underlying documentation pointed out why Heatley's resignation would ultimately have become a fait accompli. National's spinners and some news media have since tried to portray Heatley's resignation as the act of a man of principle, when all along he has flagrantly flouted the rules.

In my opinion, Heatley has displayed a classic sense of entitlement. This was obvious earlier on when he fell foul of public opinion by taking a ministerial house in Wellington and renting his own apartment to a fellow MP.

Key could not afford to keep him on in Cabinet. But by allowing this affair to play out over several days, the Prime Minister succeeded in putting clear water between Heatley and fellow Cabinet Minister Gerry Brownlee, who also shouted his electorate staff lunch on his credit card.

Brownlee has not serially abused his card the way Heatley has. But if Key had sacked Heatley on Monday it would have been difficult to fend off questions over why he was protecting Brownlee. That this hasn't occurred suggests the spin has largely succeeded - until now.

- NZ Herald

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