Infrastructure and RMA Reform Minister Chris Bishop announcing the Government’s Fast-track projects.
Video / NZ Herald
The Auditor-General has launched an inquiry into how conflicts of interest were identified and managed as ministers made decisions about what infrastructure projects should be included in the controversial fast-track approval legislation.
While expert panels will have the final sign-off on what projects get swift approval, it was up to ministers to decide what projects were listed in the legislation in the first place. They based their decisions on advice from an independent advisory group and all 149 projects that were eventually chosen by ministers were recommended by that group.
Infrastructure Minister Chris Bishop at the time said ministers followed a “really thorough and robust process” informed by the Cabinet Office with regards to managing potential conflicts of interest. This included ministers transferring responsibility to another if they had a potential conflict.
Controller and Auditor-General John Ryan’s office on Thursday said an inquiry would be carried out into the systems and processes that help ministers identify and manage conflicts of interest, with a particular focus on minister’s decisions about which projects to include in the Bill.
A statement said that identifying and managing conflicts of interest was important to maintaining trust and confidence in how public resources are used and to maintaining New Zealand’s global reputation for transparency, accountability and integrity.
“It is crucial that there are appropriate systems and processes in place to support decision-makers to identify any relevant interests they might have, and to help them manage any conflicts that might arise,” it said.
“This is especially so when decisions are being made at the highest level of government (that is, by ministers), or in relation to significant decisions about how public resources are used.”
The Government announced the projects to be included in the fast-track legislation earlier this month. Photo / Mark Mitchell
Given this and the “significant public interest” in the fast-track approvals policy, the Auditor-General said an inquiry would be carried out to understand and “provide assurance about” how well existing systems were used to identify and manage conflicts.
This will include looking at what systems and processes are in place, how they operated in practice during the selection of projects for the legislation, where are there potential areas of improvement, and what those improvements might be.
“The focus of the inquiry is to gain a better understanding of, and provide assurance about, the overall systems and processes in place,” the statement said.
“We will not examine or comment on policy decisions underpinning the Fast-track process, or the merits of individual projects or the decisions to include an individual project in the Fast-track Approvals Bill.”
It said a report is expected to be published once the inquiry has been completed.
Bishop told the Herald that ministers had “carefully followed advice from the Cabinet Office relating to the proper management of real, perceived or potential conflicts of interest”.
“With the Prime Minister’s agreement, transfers of responsibility were put in place to ensure no minister took part in considering a project for inclusion where they had a conflict of interest.”
Labour responded by saying the Government should consider the outcome of the inquiry before progressing the fast-track approvals legislation through Parliament any further.
“We welcome this inquiry, and call on the Government to wait until the Auditor-General reports back before going to committee stage where 149 projects will be added to the Bill and further progressed through the House,” Labour environment spokeswoman Rachel Brooking said.
“The 149 companies who have projects on the fast track list get an enormous advantage by not having to comply with current laws that protect the environment. The public must have confidence the decision to put projects on the list was not made because a minister had a vested interest in it.”
Bishop has previously gone into detail about the conflict-of-interest process. Following the announcement of the 149 projects, he explained that in the first instance, the ministers of infrastructure, transport and regional development were delegated authority to determine what projects be included, with each minister assessing projects in their own sectors.
Arrangements were made that where one of the three ministers decided there was a conflict, that minister took no part in its consideration and instead transferred responsibility to another.
For example, Regional Development Minister Shane Jones identified conflicts with eight projects and as a result, Tama Potaka considered their inclusion. Bishop said there was one project where he identified a potential conflict of interest so transferred decisions to Simeon Brown.
“It is important to note that these transfers applied only to the relevant ministers’ decision-making responsibilities outlined above. Transfers were not required if conflicts of interest were identified in relation to projects for which that minister did not have sector responsibility.
“Once delegated, ministers had made decisions. The final list of projects was considered by Cabinet Committee and Cabinet. Ahead of those meetings, ministers reviewed their interests and declared any conflicts of interest in relation to any of the listed projects.”
Bishop said ministers who declared an interest with a project here left the room for any discussions relating to it. The minister’s statement didn’t outline which ministers identified conflicts at this point in the process.
He previously told reporters he felt ethically comfortable with how the process had played out.
“We have been extremely thorough and robust in following that process as laid out by the Cabinet Office. I’m very comfortable with the way things have gone.”
Jamie Ensor is a political reporter in the NZ Herald Press Gallery team based at Parliament. He was previously a TV reporter and digital producer in the Newshub Press Gallery office.
