The public service watchdog is looking into government departments' management of potential conflict of interest with regards to awarding contracts to family members of Labour minister Nanaia Mahuta.
Public Services Commissioner Peter Hughes has been tasked with running a ruler across the entire public service to ensure everything is above board - a request that came from Public Services Minister Chris Hipkins. Hipkins was asked to examine the issue by Mahuta following several news stories outlining concerns about potential conflicts of interests.
Hughes told Newshub on Wednesday: "Mr Simeon Brown MP has asked me to look into complaints of conflict of interest at four agencies involving the awarding of contracts. I have agreed to do this."
"The Minister for the Public Service has now asked me to broaden this, to satisfy myself that all Public Service agencies are following proper processes to manage conflicts of interest. I have also agreed to do this."
Speaking to media on Wednesday afternoon, Mahuta said she was "really pleased" Hughes would look into "issues around the way in which conflicts of interest have been managed in relation to government contracts".
Mahuta said she raised her concerns with Hipkins verbally on September 12 and then followed that up with a letter.
"It has concerned me for some time that even though I have declared conflicts of interest and noted they have been managed in accordance with the Cabinet Manual, these stories are still persisting."
She said "that of all the issues that have been raised, I had no say in approving, at contract level, any of the matters that have been raised in the public domain".
Asked if she believed racism was driving social media targeting of Mahuta and potential conflicts of interest, the minister said: "It could well be a number of things".
"If you look at other media platforms, you can see there are certain motivations behind this that aren't helpful".
Mahuta said she doesn't keep a track of her family members involved in local government or who are engaged with government departments.
"There is so much talent in my whanau... our world is a very small one. New Zealand is only two degrees of separation in terms of the relations to others. For Māoridom, it is one degree of separation."
Kāinga Ora on Tuesday became the third agency to announce a review into a contract given to a consultancy group owned by Mahuta's husband Gannin Ormsby.
In a letter to National's Simeon Brown, who wrote to the Public Services Commissioner in August and September about government department contracts going to Mahuta's family members, Hughes said he didn't believe the matter "reaches the threshold" for an official inquiry.
"However, I agree with you that how the four agencies managed conflicts of interest issues here needs to be looked into and I intend to do that," Hughes said.
"Specifically, I intend to look into how these agencies managed perceived or actual conflicts of interest concerning KAS [Ormsby's Ka Awatea Services Ltd] and its associated business enterprises and form a view on the adequacy of what has occurred. Where any issues are outstanding, I will ensure appropriate action is taken to address them."
Brown had written to Hughes regarding contracts between Ormsby's businesses and Kainga Ora, the Ministry for the Environment, the Department of Conservation and Te Puni Kokiri Ministry of Māori Development.
Hughes told Brown in his letter that he had received correspondence from Hipkins about looking across the broader public service.
"While there is currently no indication of any further instances of the same issue, I will establish if any other agencies have similar contractural relationships with KAS. I want to be sure all relevant matters have been identified to ensure prompt, complete resolution so this matter can be put to rest."
Brown said in a statement on Wednesday that he was pleased with Hughes' decision.
"New Zealanders have a right to know how contracts were awarded to Mr Ormsby when Ms Mahuta was the Associate Minister for three Ministries that entered into contracts with him," he said.
"Conflicts of interest, or even perceived conflicts of interest, can severely undermine public trust and confidence in our democracy and public service."
Kāinga Ora told Newshub in a statement on Tuesday that it was "reviewing the procurement process on the awarding of the Ka Awatea contract".
"The review is to understand what learnings there may be and whether the relevant processes and policies were followed when engaging with Ka Awatea," a spokesperson said.
"This includes looking at Kāinga Ora procedures overall on the identification, declaration and management of perceived, and real, conflicts of interest in procurement. The review was commissioned internally and is expected to be completed in the coming weeks."
It said there was no communication with ministers with regards to the contract selection process.
According to NZHerald, Housing Minister Megan Wood has said Kāinga Ora was deficient in its conflict of interest processes in awarding Ka Awatea a nearly $67,000 contract.
The Ministry for the Environment has completed its review and found no political involvement in decision-making over contracts awarded to Ormsby's groups, but there were some issues in its processes. A Department of Conservation review remains underway.
Mahuta said the issues raised were at a "departmental level".
