The controversy over the Auditor-General may not be the last of its kind

by Jane Clifton / 14 June, 2017
RelatedArticlesModule - Martin Matthews

Martin Matthews: acted as soon as he had evidence, says SFO.

More bang for the passed buck?

When US President Harry Truman had someone make his “The Buck Stops Here” desk sign, he can’t have intended future generations of politicians to produce a sequel: “… Till I Can Find Someone Else to Pass It To.”

The art of taking responsibility for cock-ups is all but dead in our politics. Even for catastrophically bad decisions, such as those that led to the Pike River Mine tragedy and the collapse of the Canterbury Television building, the poor old buck is still roaming the deserts of accountability looking for a place to rest.

Its latest quest is quite a trudge. The chief executive who enabled the Serious Fraud Office (SFO) to retrieve every cent of loot stolen by an accomplished fraudster at the Ministry of Transport is now himself in the gun. Martin Matthews, since appointed Auditor-General, has generated more shouty column inches than jailed fraudster Joanne Harrison, who drained more than $725,000 from the ministry.

Matthews was the good guy here, but he has stood down pending further inquiries. Unhappily, by some accounts, he was not good enough early enough. New Zealand First is leading the chorus for his Auditor-General appointment to be reconsidered, pending a State Services Commission reappraisal of how he handled the Harrison affair.

It comes down to whether Matthews can be shown to have acted in a timely enough fashion. To repurpose something Winston Peters once demanded during another political brushfire, “I want to know what he didn’t know and when he didn’t know it!”

The SFO has insisted Matthews acted as soon as he had evidence of impropriety and did so quickly enough that Harrison’s assets could be frozen, forcing her back from her overseas getaway.

But bothersome questions persist.

The plight of two staffers who asked awkward questions about Harrison’s conduct early on has been left cruelly unconsidered. The commission will now hopefully find out whether, as the staffers suspect, their subsequent redundancies at Harrison’s hands were retribution for their attempted whistle-blowing. Compensation and an apology may be in order. But there’s little doubt that without the political arm-waving by Peters and Labour’s Sue Moroney, the pair would have been left to live with a possible gross injustice.

Yet another career fraudster

Going as worryingly to the heart of public sector probity is Harrison’s hiring. She was already under fraud investigation in Australia when she got the Ministry of Transport job. Although it’s understood Australian police kept that secret till some time after her appointment, it should have rung alarm bells when later disclosed, but appears not to have done. Her curriculum vitae is now also thought to be a somewhat unreliable memoir. Her appointment and continued employment even before the fraud therefore remain open to question. This country has been serially embarrassed by overseas career fraudsters in the public service, most mortifyingly the bogus Canadian who once headed Maori Television. Have our state bosses learnt too little from this?

Earlier this year, new Ministry of Transport chief Peter Mersi declined to double-check staff CVs in the wake of the Harrison episode, in case it bred a climate of distrust in his department. Funnily enough, few things breed distrust among staff better than discovering one of their bosses is a thieving liar.

By most accounts, Harrison was a stunningly effective fraudster, manipulative, strategic and charming enough to misdirect inconvenient scrutiny for a staggeringly long time. How unlucky for Matthews to have come up against his Moriarty just before he landed his dream job as the public sector’s Sherlock Holmes.

But that’s why, yet again, it’s time to dust off Helen Clark’s trusty old Allegations Swirl-O-Meter. Even if Matthews emerges from further inquiries as having been as white as a spring lamb and as persistent as the Energizer Bunny, his standing as Auditor-General will forever be tainted by these allegations having eddied around him from day one in office.

Leaks are now trickling from still-disgruntled ex-underlings of Harrison’s, which suggest staffers’ questions about a number of quite compellingly mysterious invoices were not taken sufficiently seriously under Matthews’ watch. It’s not a chief executive’s job to scrutinise invoices. All the same, this is not a reassuring backdrop for an Auditor-General, whose job it most definitely is to scrutinise such things.

But wait, it’s complicated

A further complication is that all the state’s independent watchdogs are appointed by a cross-party parliamentary committee chaired by Speaker David Carter as a protection against executive fiat. Therefore, if the State Services Commission and/or committee’s further inquiries do find Matthews’ stewardship came up short, the result will be some throat-clearing awkwardness. The Government can’t yank him from his job. But so far, the parliamentary committee has been defensive of its decision to appoint him.

Although the committee’s deliberations are legally bound to remain secret, Carter felt moved to bend the rules to publicly reaffirm both the committee’s decision and Matthews’ suitability. He disclosed that the SFO had taken MPs through a detailed account of the early warnings and investigative phase of the Harrison case and had declared Matthews’ conduct “exemplary”.

Putting aside the further complicating question of who might punish Carter for telling us details we are not meant to hear, Matthews’ fate could end up in the hands of a grudge-ridden series of caucus-room punch-ups. The caucuses will have to instruct their possibly reluctant committee MPs to change their minds and rescind the appointment. The whole situation is about as unsatisfactory as it could possibly be, especially considering Matthews appears not to have done anything wrong.

This may not be the last of this variety of bunfight. National may yet rue the recent selection of Hastings Mayor Lawrence Yule in the enviably safe blue-riband seat of Tukituki, given his council’s culpability in the contamination of Havelock North’s water last year. The independent public inquiry has further reports pending, but its primary findings directly link the council’s inattention to bore maintenance to the poisoning that hospitalised 45 and was implicated in three deaths. Truman’s eternally homeless buck is again on the trudge.

This article was first published in the June 3, 2017 issue of the New Zealand Listener.


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