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  • Writer's pictureGrant McLachlan

Kiwis are more corrupted than they think

[This article has since been updated]

New Zealanders place more trust in their politicians and journalists than they should.

Transparency International’s Corruption Perception Index regularly rates New Zealand the least corrupt country in the world. Australia regularly rates at 13th. Perception, however, is not reality.

Corruption Perception Index rankings. (Courtesy Transparency International New Zealand.)

Rodger Kerr-Newell was a CEO at three New Zealand councils. Before he left Auckland’s Rodney District Council, he claimed $42,000 – an amount which was not contractually required and was in breach of statutory requirements. The Auditor-General, however, said they had no power to require repayment.

Two years later, prosecutors spoke of a “culture of corruption” where two former Rodney council transport managers received $1.1m in bribes. Several other staff were sacked. The sentencing judge was concerned that investigators only found the tip of the iceberg.

Rodger Kerr-Newell.

Kerr-Newell moved to Australia to head the Halls Creek Shire in Western Australia. He appointed his kiwi partner before the recruitment process completed and then increased her pay by $6000 a year without disclosing their relationship. Not disclosing his financial interests, he took considerable leave for his secondary employment yet claimed $78,000 for time in lieu from the council. He even subverted the council tender process to purchase vehicles from a friend.

A two-year Australian Corruption and Crime Commission investigation concluded that Kerr-Newall had “disregard for the rules”, “took short-cuts to benefit himself”, and was “the very embodiment of corruption.”

Compared to Aussies, Kiwis have a low bar on what is perceived as corruption. Quid pro quo is part of Kiwi culture. Conflicts of interest aren’t taken seriously. Instead of denouncing corruption, it is bartered.

(Click to enlarge)

[A member of a political party was elected to the local board of a council. Earning $88,979 as chair of the local board (a fulltime position), he then campaigned to convert the chamber of commerce to a Business Improvement District ("BID"). Having achieved the required 25% threshold of support from local businesses, all businesses became compulsory members of their chamber of commerce and their membership dues are invoiced by the council as a council 'targeted' rate. The politician then was appointed as the manager of the BID and is paid an additional $92,979 salary for the 'fulltime position.' After several years in the job, his colleagues congratulated him for "his ability to find innovative ways of doing things."]

Often, it is only after journalists apply pressure when authorities investigate.

Two Members of Parliament were prosecuted and jailed only after the media got wind of their misdeeds. One minister secured a work-permit for an immigrant worker to tile his holiday home at a discounted rate. Another MP used taxpayer funds meant for an under-privileged kids’ reading programme to instead pay for a stomach stapling operation and private school tuition for her two children. Once convicted and jailed, the reading foundation offered the MP a $60,000 bonus, saying she should never have been prosecuted.

A judge in New Zealand’s highest court received a golden handshake to avoid the cost of an expensive inquiry. When a coal mine exploded, killing 29, out-of-court payments avoided the prosecution of the mine’s management.

Political interference of the civil service is a major concern. Emails surfaced that then-Police Minister Judith Collins tried to undermine the head of the Serious Fraud Office. Predictably, the investigation was a whitewash. More recently, in a 'James Comey-level intrusion', whilst investigating Labour, National, and NZ First, the the Serious Fraud Office chose to first prosecute two people linked to the NZ First Foundation.

[Following the laying of charges against the NZ First Foundation officials, the negative media attention led to NZ First being voted out of Parliament. The two men have since been acquitted.]

[The whistle blower who exposed corruption within the National Party was ejected from the party. His successor in his safe electorate seat, Christopher Luxon, became the leader of the National Party. As at September 2022, the trials of the National and Labour Party officials were heard together.]

A National MP with links to Chinese spy agencies only retired after a Chinese Labour MP did the same. If it weren’t for a whistle-blower trying to score political points, an undeclared $100,000 donation from Chinese businessmen to the New Zealand National Party wouldn’t be before the courts. The court then banned the whistle-blower from disclosing information about another 60,000 donations.

I've made donations to political parties that weren't declared. I've lodged complaints of bribery and corruption to the Serious Fraud Office that were ignored. The perception this gives is that the civil service are only to serve certain interests.

New Zealand has a Mixed Member Proportional (MMP) electoral system where political parties can gain representation in Parliament by either winning an electorate or gaining more than five percent of the total party votes cast. The number of MPs each party is allocated is roughly proportional to their share of the total party vote.

The problem with such a system is its vulnerability to political polling. I have analysed political news stories for the past decade from media organisations who commission polling companies. There is a disturbing spike in negative stories about particular politicians for the week before and during polling periods, resulting in dramatic swings.

In the past month, there has been a barrage of negative stories about the two minor parties who support Jacinda Ardern’s Labour-led government. According to polls, their support is wavering around the five percent threshold.

Such polling affects voter behaviour. Many voters, not wanting to waste their vote on a party that might not get across the threshold, may vote for another party.

As witnessed throughout the world, polls can be wildly inaccurate. Journalists in New Zealand, however, try to use their polling as a self-fulfilling prophecy.

Under MMP, no minor party supporting a government has increased their share of the vote. The media has effectively become their opponents. 'King or queen-makers' are damned either way.

Compared to an international survey of 40 countries, New Zealanders are the fourth most trustworthy of the media. Australia ranked 20. Such a level of trust should carry responsibility.

(Courtesy RNZ, 23 April 2020)

I have seen young and ambitious journalists corrupt elections. I remember neighbour, Mihingarangi Forbes, skiting about a 'scandal' for months but broke the story days before an election. Lloyd Burr ambushed a politician after colleague Jenna Lynch was leaked personal information from a government department about a politician during a polling period a month before an election. These disturbing patterns of behaviour continue and escalate in frequency to this day.

The public should be most concerned by what the media won't report. Certain journalists failed to disclose their conflicts of interest - including the closeness of their relationship with the subject of a scandal - and the information was either not published, buried, or used against the whistle blower.

New Zealand’s media is vulnerable to interference. A substantial proportion of the New Zealand Herald’s advertising is property-related. When a section editor published an article stating that property prices were falling, they received a dressing down from the chief editor.

The Herald has since used a National Party-aligned property investment lobbyist as its property commentator. These conflicts of interest are rarely disclosed.

Such a lack of balance in reporting can lead to irrational exuberance. But the Herald is not alone in their questionable motives.

More recently, faced with dropping advertising revenue, media executives have been 'lobbying' politicians for government assistance. Based on the focus of news from certain media outlets, I have serious concerns about their editorial independence.

In Australia, unethical journalism would be scorned by media rivals. New Zealand rivals, however, often turn a blind eye. Anyone who challenges media outlets can be 'totsched' (death by silence) or be treated as 'persona non grata.'

New Zealand’s election is to be held on 17 October with votes able to be cast from 3 October. New Zealand could learn a lot from Australia by challenging perceptions rather than condoning misconceptions.


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