Former MP Stuart Nash starts his new job on Monday. Photo / Warren Buckland
OPINION: The Public Purse is a new fortnightly Herald column focused on the public sector and how taxpayer money is spent.
After crashing out of Cabinet in disgrace on March 28, former Labour minister Stuart Nash will take up a new private sector job on Monday: Wellington-based commercial director for staffing agency and global recruiting consultancy Robert Walters.
Should you be in any doubt about Nash’s new role, Shay Peters, chief executive of Robert Walters Australia and New Zealand described it to the Herald this way: “Stuart Nash will be working closely with senior leaders across the state sector to alleviate challenges they are experiencing as they overcome the current skill shortage. He will provide solutions that will enable them to hit their productivity targets, ensuring the delivery of services NZ Inc. needs.
“His knowledge as an ex-Cabinet minister covering multiple social and economic portfolios, including revenue, economic development and small businesses, means he understands the pressures not only the state sector but also businesses in New Zealand are facing and will help them compete on a global stage to showcase New Zealand talent.”
Yes, that’s the same Robert Walters which is almost undoubtedly the largest supplier of contract labour to the New Zealand public sector.
The same Robert Walters which supplied $64m of contract labour and recruiting services to the 10 public service ministries and departments which spent the most on contractors and consultants in fiscal 21/22, the last year for which there is public data.
The same Robert Walters which supplied $11.2m of such labour to the Ministry of Business, Innovation and Employment (MBIE), a large swath of which was presided over by Nash, as Minister for Economic and Regional Development.
The same Robert Walters which supplies its services to the public sector under the All-of-Government contracts that are developed and managed by MBIE’s government procurement division.
And yes, that’s the same government procurement division that was a main portfolio responsibility of, you guessed it, the Minister for Economic Development, until recently, Stuart Nash.
This is an area of government policy that became a flashpoint for recruiters last year when MBIE officials proposed that the new All-of-Government contract (under which they sell across the sector) should require agencies to set their fees as a fixed dollar-per-hour charge levied on their contractors’ wages rather than as a percentage of those wages.
The agencies were unhappy. They would almost certainly lose money, and they said that staff would tend to flow away from the public sector as a consequence. In public it was the industry’s peak body, the Recruitment, Consulting and Staffing Association, of which Robert Walters is a member, which lobbied hard and successfully to roll back MBIE’s changes.
We don’t know if Peters lobbied Nash to intervene in the matter. We do know that Nash’s publicly released ministerial diary shows that in September 2021 the pair had a scheduled half-hour conversation. The topic was not noted, and it’s not clear which of Nash’s portfolios was concerned – at the time he was Minister of Tourism, Small Business, Forestry, and Economic and Regional Development. The entry simply notes: “ministerial”.
It tells us that Peters lobbied Nash and it also suggests that Nash’s ministerial responsibilities were the reason for the pair’s paths crossing.
But ministerial diaries don’t necessarily disclose the extent of the contact: they are unreliable records of meetings and conversations and need not include anything unscheduled. Quiet cellphone chats, texts and even more obvious meetings on government business often go unrecorded. An OIA request for the former minister’s phone records through the Department of Internal Affairs is required for more detail and is in process, but that too has its limits.
Questions about the extent of Peters’ lobbying of Nash are further frustrated by four seemingly missing months of his diary from the Beehive website (September through December 2022). The Prime Minister’s Office undertook to look into the matter at the Herald’s request last week, but it has not yet provided the missing months (ministers’ diaries must be proactively released).
So what exactly is the issue? Hasn’t Nash got as much right to make a living as the next guy? After all, there’s nothing illegal in his taking this new job. And furthermore, you might point out, there’s nothing untoward about contacting a minister, his staff or indeed public servants, to tell them how to improve some area of law, regulation or policy.
Indeed, but democracies should guard against the buying of special government knowledge and special government treatment. The first problem is that Nash’s quick dash to Robert Walters, a company deeply interested in government policy areas that were just recently Nash’s purview, allows too much scope for public suspicion: the possibility that the former minister could have been offered a job because of the decisions he took during his time in the Government.
It is conceivable – though there is no such evidence in Nash’s case – that a minister might, in preparation for departure from government, prepare a soft private sector landing and that this might affect his or her ministerial decisions.
In addition, Nash holds privileged information from his recent time in government – of the Cabinet’s decisions and discussions and of other ministers’ views – and there is now the obvious possibility for Robert Walters to make use of this inside knowledge.
Yes, you say, but that may be a moot point: there is an election at hand, and the polls suggest that the public will boot all of Nash’s former colleagues from the government benches come Saturday.
Maybe the election cycle will ensure that a fresh batch of ministers is ushered into the Beehive shortly, but it will do nothing to refresh the cast of senior public servants who recently reported to Nash on matters closely related to Robert Walters and its staffing and recruiting work.
The circumstances are marginally less compromising of the public interest than Kris Faafoi’s departure from Cabinet last year, when after just three months he announced he would take up government lobbying work. In Nash’s case, exactly who he will be working for is at least clear.
But if either case were to play out abroad, in Canada for example, both ministers would be barred from lobbying public office holders – including both ministers and senior civil servants – for a stand-down period of five years.
The Canadians are among the most toothy on this count. But countries including the UK, the US, Australia and Taiwan all maintain versions of a cooling-off period for ministers (some provisions are more watery and short-lived than others).
There is work under way at the Ministry of Justice to explore this possibility; it was instigated by Prime Minister Chris Hipkins after the news of Faafoi’s post-ministerial work broke, along with other details of the extent of government lobbying. But it is still nascent.
The ministry’s most recent report to Justice Minister Ginny Andersen noted only that the programme of work will include “options around decision-makers who are lobbied”. It’s not even clear that ministers’ post-employment, as it’s often referred to, will be tackled.
A report back to the minister is due in February. At that point, it’s entirely conceivable that Andersen will be out peddling what she knows of this unfolding process to interested parties.
The problem is not specific to Labour or to this Government. It is long-standing. What’s important now is that whoever takes on this particular piece of housekeeping, the revolving door is shut.
The council has also been served with judicial review proceedings.