KEY POINTS:
Prime Minister Helen Clark brought an intense media death-watch to an end yesterday - not with a noose around Winston Peters' neck but with a face-saver.
It is a measure of Clark's consummate political skills that she first created sufficient space for her embattled Foreign Minister to cool
down before cutting a deal so the Serious Fraud Office investigation into political donations to New Zealand First can be expedited.
The visit of Brazilian Foreign Minister Celso Amorim provided the perfect cover. While Amorim paid court to Peters over fine wines at dinner on Thursday night, then met Trade Minister Phil Goff and Clark herself yesterday, negotiations continued and the accommodation was stitched up.
Amorim wasn't saying much. Diplomats are diplomatic, he quipped. But the intensity of the allegations surrounding New Zealand's prime diplomat were more redolent of a banana republic than a First World state.
Peters gets to offer up his portfolios to Clark (in the meantime) instead of being stood down or sacked. The SFO gets a prime ministerial nudge to hurry up the investigation instead of playing to the cameras and stretching out inquiries until after the election; a situation which could adversely affect NZ First's electoral chances irrespective of whether charges are ultimately laid.
This is important given the considerable leakage from the SFO's preliminary inquiries and the clear positioning by National MPs in relation to the privileges committee inquiry Peters is also facing.
Gossip was rife among business people and politicians at the farewell function for Australian High Commissioner John Dauth in Wellington on Tuesday evening that the SFO was poised to announce a formal investigation. That announcement did not come until nearly 48 hours later after Peters himself had challenged the SFO to charge him.
SFO director Grant Liddell's press statement and subsequent comments also went further than is the norm. It is problematic that the SFO, which was about to be legislated out of existence, has not played a more prudent hand, a factor that will not doubt be drawn to Liddell's notice when Peters and his lawyer Peter Williams meet the SFO today.
But Clark had other reasons to act: good governance demanded that she ensure Peters stood down while the SFO inquiry took place. Cabinet Minister David Parker was stood down in lesser circumstances. National MP Murray McCully did not achieve Cabinet rank in Jim Bolger's Government until an SFO fraud investigation cleared his company.
Clark also needed to exert leadership within her own ranks as top Cabinet ministers became increasingly restive at how the Faustian bargain Labour struck with Peters has blown up in their faces just weeks from polling day. If Labour is to stand any chance of redeeming its position, clear water needed to be put between itself and the Peters party.
The Foreign Minister was also in extremis. That was abundantly obvious when he made an extraordinary phone-in call to National Radio's Sean Plunkett yesterday morning. Out of kindness to Peters' obvious confusion, Plunkett soft-pedalled as he tried to draw him out into explaining why allegations that political donations to NZ First did not reach their intended destination were vile, malevolent, evil and wrong.
For a politician who has habitually worn the garment of the accuser, it made for pitiful listening. Not too dissimilar, in fact, to former SFO director Charles Sturt's breakdown on the witness stand during the winebox inquiry into Cook Island tax-dodging after being made punch-drunk by Peters' persistent allegations.
No politician under such obvious strain could continue to do his job, but Clark needs to go much further to restore her own diminished credibility.
Next week Parliament's privileges committee will resume its inquiries into the $100,000 donation that businessman Owen Glenn made to further a post-2005 election legal challenge mounted by Peters. Clark should offer to give testimony to the committee on her own conversations with Glenn on this score which she did not reveal until after the obviously primed National deputy leader, Bill English, queried her knowledge in Parliament.
She should also announce an independent commission of inquiry into allegations of corruption in the scampi industry which persist years after a select committee investigation hit rocks.
Act leader Rodney Hide's allegations in Parliament this week that NZ First was paid cash by Simunovich Fisheries after Peters made corruption claims against it cannot be left dangling.
The SFO's Liddell says that on the basis of the information now available he does not have a basis for using statutory powers to inquire into allegations that there was an attempt corruptly to influence the select committee inquiry into the allocation of scampi quota.
The SFO is not the right body to examine such claims. Nothing short of a full public inquiry headed by a High Court judge is needed.
Clark should appoint such a commission then call the election.