Report clears payment to MP

John Tamihere

Ousted cabinet minister John Tamihere has been cleared of key charges in an independent inquiry into his $195,000 "golden koha" payment.

But it is understood Douglas White QC's draft findings criticise Mr Tamihere over a four-wheel-drive vehicle he received and over tax liability for a 1998 bonus of $22,784.

Mr White's inquiry has established Mr Tamihere did not have to pay tax on the $195,000 payment he received from the Waipareira Trust in 2000.

Mr White was charged with finding whether appropriate tax was paid, who paid it and what Mr Tamihere understood to be the arrangements for payment.

The Herald on Sunday understands the White report also finds:

* The trust, Mr Tamihere's former employer, should have paid the tax;

* Mr Tamihere legitimately believed he was not responsible for it;

* Mr Tamihere has been cleared of any questions over election expenses.

A month ago, Mr Tamihere resigned from Cabinet after acknowledging accepting the $195,000 payment from the Waipareira Trust.

It was a payment he had earlier claimed to have refused, in line with the Government's 1999 election campaign against golden handshakes.

Last month he justified the payment as "koha", to the Herald on Sunday.

Mr Tamihere refused to comment yesterday on the contents of the White report, even though he is believed to have a copy of the draft.

Drafts have also been sent to lawyers for a number of people who are criticised in the report, including trust chief executive Reg Ratahi and former financial officer Mike Tolich.

Prime Minister Helen Clark would not comment on the report, saying she hadn't seen it.

However, Mr White had originally been due to deliver the finished report to her by November 26, and she has promised to make it public.

Although Mr Tamihere's supporters optimistically envisage a triumphant Waitangi Day reinstatement to Cabinet, it is likely he will remain on the outside for the rest of the Parliamentary term.

It means a first-round draw in the battle that cost the former Cabinet minister his job, with both the Government and the lead accuser, Act party leader Rodney Hide, set to declare victory.

The fight will continue with the Serious Fraud Office inquiry into $100,000 of questionable payments by the trust when Mr Tamihere was chief executive, and the Inland Revenue inquiry.

Helen Clark is not expected to offer any signal of confidence in Mr Tamihere until she is sure she will not be further embarrassed by revelations about the maverick former minister.

Mr White's report does not deal with the moral or political questions over Mr Tamihere accepting the $195,000 payment.

Mr White has tracked the approval of the payment through Waipareira Trust minutes, and quizzed trust members on how they voted.

Mr White is believed to have examined electronic banking records for the trust when looking at other bonus payments to Mr Tamihere. His questions over the 1998 bonus led to his examination of the records, which are operated by trust board members.

The 300-plus page report also carries in-depth discussion of tax issues and other so-called golden handshakes, pointing to further questions about tax for investigation by the IRD.

Naida Glavish, an opponent of Mr Tamihere and interim deputy chair of the trust, said she met with Mr White a month ago and his questions focused on the $195,000 payment. The meeting, at accounting firm KPMG's Auckland offices, was recorded and conducted under the eye of the trust's law firm, Russell McVeigh.

She said he quizzed her over who was at the meetings during which the payment was approved. He also asked about the responsibility for paying the tax.

"He asked whether I accepted the tax was a Waipareira responsibility, and it is, and that's what we've been saying."

Mrs Glavish said Mr White had the minutes of the trust board in front of him, and referred to them as he questioned her. He repeatedly asked if the minutes met her recollection of the events that surrounded the payout being approved.

"It was approved. It was a very tight vote. It went through on a majority. That's where one can question democracy."

The approval for the payment was made when there was no money in the bank to cover it, and Mr White was told it was conditional on the money being available, said Mrs Glavish.

She said this led to a discussion with Mr White about the trust's finances, and also the trust's demands that Mr Tamihere focus on developing relations with Ngati Whatua, pursuing the trust's Waitangi claim and helping establish a wananga (university) in West Auckland.

She said she was also asked about the four-wheel-drive, and told Mr White she believed the vehicle belonged to the trust, not Mr Tamihere. "They can argue it was given to him as the trust representative on the board."

Reg Ratahi, chief executive of the trust, said he wanted taxpayers to cover the $80,000 it cost for the lawyers the trust hired to watch over the 10 members interviewed by Mr White.

- THE HERALD ON SUNDAY