Thomas Cranmer: Sidestepping Conflicts - Wellington Style

The best sidestep in town used to be seen at the Cake Tin but the Beehive is now the venue to watch the most electrifying players in the capital sidestep conflicts with consummate ease and panache.

For many years the best sidestep in Wellington belonged to Christian Cullen. His electrifying change of direction and acceleration are the stuff of legend. Cullen is now long retired and his title has since passed to Doug Martin, the former Deputy State Services Commissioner and founder of Wellington-based consultancy firm, MartinJenkins.

Martin has a lower profile than Cullen ever had but his frequent changes of direction are no less exhilarating for his fans within government and bewildering to his opponents. Last November, the Herald reported that opposition parties had questioned Martin’s independence after he had been appointed as the independent chair of the government's working group to review Three Waters.

Christopher Luxon, at the time National’s spokesperson for local government, said:

It is concerning that the same firm that embedded a consultant in a senior DIA role working on the Three Waters programme has now supplied the independent working group chair. That deserves further questioning.

Act’s local government spokesman Simon Court said the appointment would not “deliver the kind of robust and independent critique of Three Waters that's sorely needed. Is MartinJenkins really going to criticise the work of MartinJenkins?”.

Then in May the Herald revealed that the government had spent $21 million on consultants and contractors for its Three Waters reform in the 20 months to the end of February. More than $2.5 million of that amount went to MartinJenkins.

In response to questions put to the government by the Herald, the Department of Internal Affairs confirmed that on top of the amount of $2.5 million, Martin was also directly paid an additional amount for chairing the working group.

When questioned about the apparent conflict of interest in his role as independent chair of a process intended to reconsider the work of his MartinJenkins colleagues, Martin declined to comment. Instead he referred the Herald to the DIA. A spokesperson for Minister Mahuta said “there is clearly no conflict of interest here. Doug Martin has neither had an ownership interest in, nor been director of MartinJenkins for some years”.

That explanation seems barely credible given that Martin still appears on the MartinJenkins website, complete with MJ contact details, and alongside the firm’s directors. Although best avoided, it is possible of course for two individuals (or teams) within the same organisation to work on different and potentially conflicting roles on one transaction provided that there are robust ethical walls in place that prevent the transfer of information between the two individuals or groups, and provided further that if an actual conflict arises (such as one team reviewing the other’s work) one of teams agrees to stand down.

However in the case of DIA and MartinJenkins, it appears that they cannot recognise the conflict, let alone manage it.

The rationale that there is “clearly no conflict” because Martin is no longer a director or shareholder of MartinJenkins is such a bizarre and arbitrary distinction that it can only make sense if you’re a fully paid-up member of Wellington’s governing class.

As if to demonstrate just how nimble his footwork is, when it was announced a few months ago that Martin had been hired by Wellington Water to conduct an independent inquiry into a fluoridation failure at its water treatment plants, the water utility confirmed to the Herald that the contract was in fact with MartinJenkins. One moment the independent chair able to objectively review the work of his “former firm” and the next, a MartinJenkins consultant. Chapeau!

As with all the greats, they inspire the next generation of players to imitate their strengths. And so it is with Doug Martin.

It’s no surprise therefore that when Minister Henare’s partner, Skye Kimura, set up communications agency Tatou NZ with Henare’s twin brother and other family members, she did not become a shareholder or director. Instead the agency is owned by Greg Partington’s Waitapu Group with Kimura being held out as the leader and CEO. The agency pitches for government contracts and even features Minister Henare in its promotional videos but as if by magic there appears to be no conflict with this arrangement.

The newest proponent of this style of business is former Cabinet Minister, Kris Faafoi. His new firm, Dialogue22, specialises in public and government relations, and is also owned by Waitapu Group. Faafoi is described as the leader and CEO of the new outfit, and like Martin and Kimura, is not a shareholder or director.

Will Faafoi take the view that when Dialogue22 is back in his old Beehive stomping ground lobbying former colleagues on behalf of commercial interests there will be no conflict to declare because, like Martin and Kimura, he is not a shareholder or director of the company he represents?

Unmanaged conflicts are not welcome at the best of times. Christopher Luxon can attest to that after last week’s revelations concerning one of his MPs. But the fact that questions relating to conflicts have been raised that go to the heart of the Three Waters reforms is particularly concerning. The reforms are controversial, wide-ranging and of national significance for our water resources. In the circumstances conflicts should be handled assiduously, and where there is doubt (or appearance risk), the government should err on the side of caution. It’s regrettable that it hasn’t on this occasion as it undermines reforms that are already precariously balanced.

Call me old fashioned but I prefer watching Cullen tearing the opposition to ribbons rather than Wellington insiders pulling questionable moves on an unsuspecting public. Ardern has shown herself to be singularly uninterested in this issue so there is no chance of anything being done before the election but perhaps a new government will see the sense in updating some of the laws of the game.

Thomas Cranmer is a pseudonym. You can read Cranmer's substack here