Novopay: Banks had Talent2 shares while on committee

Act Party leader John Banks. File photo / Mark Mitchell

Associate Education Minister John Banks had shares in Australian company Talent2 at the same time he sat on a Cabinet committee that received progress updates on a planned rollout of Talent2's Novopay payroll system before it was launched.

Mr Banks is a Minister outside of Cabinet, but is on the Cabinet Committee on State Sector Reform and Expenditure Control (SEC).

Between January and May last year SEC received key documents relating to a planned rollout of Novopay and a backup.

On January 27 the committee received an update on the Education Ministry's contract with Talent2, which included a letter to chair of the committee Bill English from Education Minister Hekia Parata and Associate Education Minister Craig Foss.

The report showed the go-live date for Novopay was originally intended for July, but was held off by four weeks.

"As a fall-back option, the Ministry had engaged the incumbent payroll supplier Datacom to develop a proposal for a business continuity service which could be used in the event that Novopay fails. This could include the development of new software by Datacom".

On May 22 last year, while Mr Banks still owned shares in Talent2, a delegation of authority document on the payroll project went to the committee.

The document clearly states Talent2 was the provider and indicated that plans for a signoff on Novopay was likely.

On November 22 last year, seven months after crucial meetings over payroll, Mr Banks issued an Act Party statement saying he had not held shares in Talent2 since May 28, 2012 when the Australian-owned company moved to privatise the company and de-list from the Australian stock exchange.

Mr Banks said he advised the Cabinet Office of the sale of his Family Trust's shares on May 29, last year.

He also said he declared his Family Trust's shareholding in Talent2 to the Cabinet Office when he first became a Minister.

"He has never received any government information or briefings regarding Talent2 (or any company they are connected to), or participated in any discussions at either Cabinet or Cabinet Committee," the statement from Mr Banks said.

This meant Mr Banks would have had to exempt himself from most of those meetings, but APNZ have not been given any evidence whether he did.

Mr Bank's office could not confirm whether Mr Banks attended key committee meetings between January and May, or if he received the documents put before that committee.

A spokeswoman for Mr Banks confirmed he attended SEC meetings, but said he followed Cabinet Manual processes, never received any briefings or papers on the issue of Novopay or Talent2, and had not discussed it with ministers or been present during any discussions about Novopay or Talent2 at any Cabinet Committee meetings.

Cabinet Office's acting deputy secretary Tania Warburton would not respond to questions, deferring the matter to Minister Responsible for Novopay Steve Joyce's office, under the Official Information Act.