Tamihere upset as Clark reshuffles portfolios

John Tamihere is upset that, just before the release of the first report on his financial dealings, Prime Minister Helen Clark has effectively ruled out a return to the Cabinet for him in her announcement yesterday of a Cabinet reshuffle.

She has decided not to keep his post at No 17 open any longer and has reallocated his portfolios on a permanent basis, not on an acting basis as she had before.

Asked if that sent a signal that Mr Tamihere would not be readmitted to the Cabinet before the election, she said: "It does send that signal."

She then gave conflicting reasons for keeping him out - first, that she didn't want ministers to be acting ministers for "a long period of time" and then that "the election isn't actually that far away".

The election has to be held by September 24 and Helen Clark said the "the present intention" was to run full term.

She said she also wanted the Serious Fraud Office to be given time to conduct its inquiry.

Mr Tamihere was clearly upset by Helen Clark's signal that he would not be back.

"I'm extraordinarily surprised by her comments because I've had conversations and never had that view been solidified," he told the Herald.

"I was not aware that that was a view held by the Prime Minister until you have expressed it to me."

Mr Tamihere stood aside from the Cabinet in early November after admitting he had accepted a golden handshake from the Waipareira Trust which he had earlier said he would refuse and while two inquiries were conducted into allegations of financial misconduct.

One is being conducted by the Serious Fraud Office and the other, which Helen Clark commissioned, was undertaken by Douglas White, QC.

His report was delivered to the Prime Minister late yesterday and is expected to be released today or tomorrow.

The draft report is understood to have found fault with Mr Tamihere over the non-declaration on the ministerial register of gifts, interest and assets of a free Toyota Landcruiser he was given as part of the golden handshake.

Only four Cabinet ministers were untouched by the reshuffle, which is perhaps why the notion got about that it was going to be extensive. In the event, it was not as big as expected.

"It's a question of getting a balance between continuity and bringing in fresh blood and signalling where things may lie in the future," Helen Clark said.

She signalled that she expects to make major changes if re-elected, including putting Pete Hodgson into health to replace Annette King.

She also suggested that some of the present Cabinet would not be reappointed.

Deputy Prime Minister Michael Cullen has been made Attorney-General, which may be interpreted in some quarters as payback to the Judiciary. Helen Clark and Dr Cullen, a non-lawyer, have engaged in verbal volleys with the Judiciary over the sovereignty of Parliament.

Relative newcomer David Benson-Pope, who joined the Cabinet in March, has been catapulted to a key responsibility as schools minister.

Education Minister Trevor Mallard will keep oversight of early childhood education but has gained tertiary education, which caused trouble for Steve Maharey with scandals over the proliferation and funding of community courses at polytechnics.

Mr Maharey has acquired the science portfolio from Mr Hodgson, who has picked up associate health, as training for health minister, and commerce, from the Speaker-designate, Margaret Wilson.

Jim Sutton has shed two portfolios. Progressives leader Jim Anderton has taken forestry from him and minister outside Cabinet Damien O'Connor has picked up rural affairs.

Mr Sutton lost popularity with the rural sector over land access proposals, as did Mr Mallard with his schools closure policy.

David Cunliffe, also a minister outside Cabinet, has been given a significant promotion, picking up the full portfolios of communications and information technology from Paul Swain.

Mr Swain gets state-owned enterprises from Mark Burton, who will take treaty negotiations from Margaret Wilson.

Under-Secretary Mita Ririnui has been made a minister of state outside Cabinet.

The president of the New Zealand Bar Association, Dr Jim Farmer, QC, did not believe there would be a problem with the appointment of non-lawyer Dr Cullen as Attorney-General so long as it was "an interim, short-term measure".