Neil Quigley resigns as Reserve Bank chairman ‘with immediate effect’

Neil Quigley has resigned as Reserve Bank chairman. Photo / Mark Mitchell

Reserve Bank board chairman Neil Quigley has resigned “with immediate effect” in the wake of the shambolic handling of Adrian Orr’s resignation as Governor.

Finance Minister Nicola Willis made the announcement just before 6pm on Friday - the day after the Reserve Bank was pushed by the Ombudsman to reveal there was more to Orr resigning than the public was led to believe.

On Thursday, the Reserve Bank revealed Orr temporarily stepped down as Governor a week before he resigned on March 5.

Orr stayed out of the office during this time, as the board presented him with a letter raising concerns over his conduct in meetings, the lack of trust between him, the board, Treasury and Willis, and whether Orr could do his job with less funding than he wanted.

When Orr resigned, the board agreed it would withdraw the letter, as Orr contested parts of it.

Quigley refused to elaborate on why Orr resigned on the day of the resignation, only to say it was a “personal decision”.

Then in June, the bank said the resignation was due to Orr disagreeing with the board over the amount of government funding to pitch for.

Quigley denied there were conduct issues at play. Indeed, the board agree to bin the letter that flagged concerns over Orr’s behaviour in two meetings in late February.

Speaking to Newstalk ZB, Willis said she would have asked Quigley to resign had he not done so himself.

She said that earlier in the day, she talked to Quigley about “ongoing criticism” of the board’s handling of information relating to Orr’s departure.

“I had expressed to him my concern that the bank’s reputation was being impacted, and he had agreed with me that that was a serious matter,” Willis said.

Pushed on whether she herself had been transparent through the saga, Willis said she reiterated on several occasions that the bank should have been more open.

She conceded she knew Orr stepped back from the role before he resigned, and knew the board gave Orr a letter with its concerns. However, Willis said she didn’t want to get involved, as she wanted to uphold the Reserve Bank’s independence from the Government.

Willis never responded to questions the Herald sent her on Thursday night, asking if she still had confidence in Quigley, whether she had been complicit in what looked like a cover-up, and how the public could have confidence in Quigley’s judgement when it came to the appointment of a new Governor.

The board is responsible for recommending who Willis gets the Governor-General to appoint as Governor.

Willis wouldn’t tell the Herald whether she had received a recommendation yet, but said the process was “well advanced”.

Asked whether the public could have confidence in it, she said, “It’s a board recommendation and I have confidence in the process they have followed.”

The Herald understands those in the running for Governor include interim Governor Christian Hawkesby, former Treasury chief economic adviser Dominick Stephens, Auckland University macroeconomics professor and Reserve Bank Monetary Policy Committee member Prasanna Gai, and Motu Research executive director John McDermott.

Willis said the board’s deputy chairman Rodger Finlay would exercise the functions of the chairman until an appointment was made. The search would also begin for an additional board member to fill the vacancy created.

“Mr Quigley departs with a new funding agreement in place, a major review of capital settings out for consultation and the recruitment of a new governor well-advanced,” Willis said.

“He leaves the bank well-positioned for the future. I thank him for his service and wish him well for the future.”

The Herald has requested comment from Quigley.