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Home / New Zealand / Politics

Toby Manhire: Key like a cat on a hot tin roof

Toby Manhire
By
Toby Manhire
13 May, 2016 12:11 AM6 mins to read
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The squabble happened during a question from Green MP James Shaw about Mr Key using the examples of Greenpeace and Amnesty as among the entities named in the Panama Papers.

In an early 70s sketch from Monty Python's Flying Circus, Michael Palin arrives at an "Argument Clinic" and undertakes a session with John Cleese, which consists, more or less and back and forth and for several minutes, of Palin saying, "Yes it is," and Cleese responding, "No, it isn't." A similar kind of argument clinic has been in session in New Zealand politics this week, too. New Zealand is a tax haven. No, it isn't. Yes, it is. And repeat until you lose the will to live.

Like beauty, perhaps, it is in the eye of the beholder. Mossack Fonseca, for example, beholds somewhere offering "secure and very flexible company and trust laws, allowing for the speedy formation of appropriate mechanisms for wealth protection, inheritance and tax planning", as explained in one of the leaked documents from the Panama-based law firm.

The website of another outfit promoting New Zealand as a place to park money, meanwhile, observes that "NZ is not well known as a tax haven, and this is a major advantage", trumpeting the attractiveness of "a tax elimination structure from a reputable country that is not regarded as a tax haven".

Amid the white noise of the yes-we-are-no-we're-not squabbling, the truth of course is somewhere in the middle: New Zealand has become attractive as a location for offshore trusts or look-through companies, but these are neither integral to our economy nor a defining characteristic.

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Nor would it be that hard to fix - amp up the disclosure rules, so to flush out or at least dissuade anyone who might be evading tax or laundering money, or otherwise involved in nefarious activity from sticking their cash under our mattress. As tax expert Deborah Russell puts it, it is simply a matter of following the Australian example and "collecting names of settlors and beneficiaries, and proactively disclosing them to authorities elsewhere".

So why doesn't the government do that? There is a distinct sense that the Prime Minister does see the sense in such a path. He was dismissive at the outset four weeks ago, but has since appointed John Shewan to review the offshore trust tax regime and of late started to use, a lot, the word "learnings" - a noun that should itself incur a hefty levy.

But at the same time, some of Key's reaction has been puzzling - enough to prompt Winston Peters to suggest he appeared "like a boy who's had a widdle behind the couch and he's denying it to mum".

First, despite the fact that the NZ-related Panama Papers material unveiled on Monday morning contained nothing politically explosive, Key refused to show up for his weekly interview on RNZ's Morning Report. Then, in question time, he went into petulant-sneer mode and the Speaker turfed him out.

A clutch of opposition MPs and activists insisted this was deliberate on the part of the PM: he sought to get expelled, as part of the infamous Crosby-Textor "dead cat" political strategy (essentially, chuck a dead cat on a table and you'll change the subject from x to the fact there's a dead cat on the table). Yeah, nah. In fact, it was a fairly harsh dismissal; it looked like a trade-off from the Speaker for the soft dismissal of Labour's David Parker the day before, like a referee over-eager to issue a red card because he'd been hasty with one for the other side.

The ejection from the House didn't distract from the Panama Papers issue; it attracted attention - what's got him so hot and bothered? Less dead cat, more cat on a hot tin roof.

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How to explain the PM's overwrought response? Is he anxious there is more to emerge that could affect him directly, as it has, for example, for his counterparts in Britain and Australia? Doubt it: if there had been, it would probably have landed by now. Something to do with the reasons the IRD dropped plans to look into foreign trust rules, and the involvement of his personal lawyer in lobbying on the issue? Unlikely. Or is he worried about the Panama Papers leaker having him singled him out in a statement on the weekend? Key, wrote the leaker (and hacker, probably), has been "curiously quiet about his country's role in enabling the financial fraud Mecca that is the Cook Islands". Maybe there's something in that, but no one seems to know how, exactly - and in the absence of any further substance it's a bit of an underhand assertion.

Maybe John Key just gets bored easily, or really relishes parliamentary jousting, but it's hard to understand why he can't simply acknowledge, as has his friend Barack Obama, that the Panama Papers point up issues of huge financial and moral importance. Why, as far as New Zealand is concerned, he can't disabuse any image of behind-sofa widdling by simply saying: yup, there's a problem, we didn't put it there, but we'll fix it. The most damaging part of the Panama Papers storm for the Prime Minister is starting to become his own response to it.

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PM can thank Hager

The Prime Minister doesn't like Nicky Hager. Not a bit. But when he looks back on his long and successful term, John Key may well have cause to thank him. Because whatever you think about the revelations in the book Dirty Politics, it had one unmistakable effect: cutting the cord with the blogger Cameron Slater, or "Whale Oil", as he calls himself, in a reference to the way some words can sound rude if you say them in an Irish accent.

The Dirty Politics scandal may not have dented National polling, but it did end co-operation between the PM's office and the attack blogger. The text chatter between Slater and Key stopped. Jason Ede, the apparent blog-attack-bridgehead, soon enjoyed the chance to spend more time with family.

This week, it was reported Slater, one of NZ's most strident opponents of name suppression, had tried to have his name suppressed forever in a case over proffered payments for hacked material from a rival blog (the hacks seem never to have happened, but that's another story). After an interim name suppression was lifted - Slater got diversion, despite the police having oddly failed to consult with the owner of the site concerned - Mr Oil has lashed out all over the internet. You can read it if you wish, but make time for a shower after that.

The Prime Minister has far too much on his plate to read it, but one of his advisers probably will. And it wouldn't surprise me at all if they thought: thank goodness we're no longer exposed to that toxin. They might even, maybe, think: thanks for that, Nicky Hager.

Debate on this article is now closed.

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