Treasury secretary Gabriel Makhlouf. Image: Radio NZ/ Rebekah Parsons-King
Treasury secretary Gabriel Makhlouf. Image: Radio NZ/ Rebekah Parsons-King

The BulletinJune 28, 2019

The Bulletin: Farewell Makhlouf, shame about the mess

Treasury secretary Gabriel Makhlouf. Image: Radio NZ/ Rebekah Parsons-King
Treasury secretary Gabriel Makhlouf. Image: Radio NZ/ Rebekah Parsons-King

Good morning, and welcome to The Bulletin. In today’s edition: Makhlouf departs with questions hanging in the air, emissions still not moving the right way, and ministerial roles in housing reshuffled.

A few months ago, you’d probably be forgiven for not knowing the name Gabriel Makhlouf. Until yesterday, he was the secretary of Treasury – an important job, to be sure, but for those outside business or the public service, an obscure one. Then he found himself at the centre of a storm, made everything worse, and in doing so opened up a whole lot of new questions about the public service and accountability.

We’ll start with what happened yesterday – a report into the response to the now-infamous Treasury breach came out. Interest has a good wrap of what it said: Makhlouf screwed up, and “did not act reasonably” in characterising what happened as a “hack.” Rather than owning his department’s mistakes, he put the focus on those who had got the information out. The report suggested it probably wasn’t a sackable offence, but still, Makhlouf never offered to resign, but he has now however said sorry for not keeping budget information secure – something that wasn’t really what he needed to apologise for. The biggest consequence for him personally, ahead of taking up the top job at Ireland’s central bank, is that his reputation has suffered.

Is that accountability? Not in the slightest, say the National party, who appointed him to the job in the first place. Stuff reports they now say he should have been booted for the failings, and also say it calls into question the accountability of finance minister Grant Robertson. After all (and let’s be fair, this is heavily disputed) National argue Robertson dishonestly called the party criminals in how they came about the information. Just to reiterate, Robertson maintains he accused them of nothing of the sort, and depending on how you read that statement, you can make either case.

Then there’s the question around what Treasury itself became, under his watch. Economist Dr Eric Crampton wrote eloquently about that on The Spinoff earlier in the month, about whether it is still fit for purpose as an agency giving economic advice. The new boss at Treasury will be “world class economist” Dr Caralee McLiesh from Australia, reports the NZ Herald. That’s well and good, by as Dr Crampton pointed out in his piece, it’s the whole organisational culture of Treasury that has lost economics expertise.

It’s easy to dismiss all this sort of stuff as not particularly relevant to anyone’s day to day lives, outside of a small handful of those at the top. But people like Makhlouf are extremely well paid, from the public purse, to lead organisations competently and take responsibility when something goes wrong. It’s not that mistakes get made – that’s happens. It’s the response to those mistakes that should worry the public. In this case, a lot of people have been made to look very foolish indeed. But what’s worse is that maybe this is just how things work now. How future mistakes are handled by other public service bosses will give a clear sign of whether accountability is still a core principal of such roles.

The emissions of households in New Zealand have risen by 20% in a decade, reports Radio NZ. That’s largely based on increased use of cars, and increases in household emissions go against international trends – worryingly, households are actually becoming less efficient in terms of emissions production. However, it’s not the full picture – even with the rise, that still only accounts for 11% of New Zealand’s total emissions profile. Emissions from dairy farming have also increased significantly, and as this Stuff report notes, around half of all of New Zealand’s emissions are produced by primary industries.

Phil Twyford is no longer the housing minister, but he is still sort of a housing minister. The Spinoff’s Toby Manhire has unpacked the changes to how the Housing ministry will be overseen, with Megan Woods taking the lead role. Twyford will stick around to oversee urban development, and Kris Faafoi will also join the new ministerial team. It’s the biggest change in the Ardern ministerial reshuffle, and comes amid a wider ‘reset’ of the Kiwibuild policy.

The potential sale of the Westland Milk co-op to Chinese buyers has raised plenty of concerns around the primary industries. It’s brilliantly deconstructed in this (paywalled) NZ Herald piece by Andrea Fox, with a headline that perfectly captures the conundrum – ‘the money or the flag.’ The sale seems imminent, as the buyers are willing to pay way more than what anyone really believes the co-op is valued at. But the question of such a long-standing organisation going into foreign ownership is giving many pause for thought. The shareholder vote will be cast on 4 July.

Here’s an interesting suggestion for a new name for our neighbourhood. Radio NZ reports a group of Pacific scholars say Oceania should be renamed as Moana, the idea being that it would challenge the Western framework of how the people and cultures of the Pacific are conceptualised. But it’s not a simple question – others pointed out that while there are shared histories of Pacific people, there are many distinctions and differences which can’t be boiled down together.

If you’re looking for a good explainer on the new R&D tax credit system, look no further than this from The Spinoff’s Jihee Junn. A much wider range of businesses will have access to this sort of government support, but there’ll be heaps of new complexities to factor in. Even with the changes too, some smaller businesses will still be left frustrated.

A bit of feedback from reader Cathy, on yesterday’s discussion of how MP’s approached the End of Life Choice bill debate. It’s certainly a point to keep in mind. “Interesting that many MPs use their personal experiences to inform their decision making around the End of Life Bill. I personally support it, but in the wider scope of things, it’s a shame there aren’t more people in positions of power who have personally experienced extreme poverty, needing an abortion, living in a leaky home, and relying on public transport.”

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WorkSafe ‘enforceable undertakings’ are a way of educating companies to change their attitude to worker safety. (Photo: Getty.)

Right now on The Spinoff: Toby Morris explores the troubling statistics about how much more likely police are to use force against Māori in a new edition of The Side Eye. Queer and trans cartoonist Sam Orchard joins Two Sketches, to talk, draw and ruminate. Joshua Hitchcock unpacks the pros and cons of a Māori owned bank, to service the growing Māori economy. Lyn Barnes explores the use of restorative justice in the workplace around health and safety breaches. Britta Stabenow has a fascinating essay about video game collection, and the strange subculture that lives and breathes it.

For my money, the must read piece of the day is this from Scott Hamilton, who has taken a brutally honest look at New Zealand’s forgotten history of anti-Indian racism. Did you know, for example, that Carterton was effectively ethnically cleansed and many major newspapers endorsed it? Or that the RSA used to have a policy against Indian immigration? I didn’t know either, but it says a lot about why aspects of New Zealand are the way they are today.

For more artistically minded filmmakers, Cannes is the pinnacle of their medium. So why don’t NZ films ever seem to be there? This Pantograph Punch feature by Doug Dillaman seeks to unpack this question, and the answers are partly cultural, and partly logistical. But either way, the odds remain stacked against New Zealand filmmakers in this part of the industry. Here’s an excerpt:

When I made my first feature, I applied to Cannes. Why wouldn’t you? Everybody dreams of going to Cannes, and you’ve got to buy a lottery ticket to be in the game. In retrospect, lottery tickets would have been a substantially wiser investment.

Here’s what I didn’t understand: you shouldn’t make a feature film and then see where it fits in the market. Unless you’re working with the barest of means, you’re investing a great deal of money and time with negligible opportunities for return. When audiences have thousands of hours of streaming content at their fingertips, optimised by professionals for maximum engagement, “good for a first feature” ain’t good enough. Hell, even “objectively good” isn’t good enough. Anything short of “great, with easily salable elements”, and you’re screwed. That’s just as true for film festivals as it is for the multiplex.

For those wanting to know the shape of the 2019 All Blacks, the Super Rugby semi this weekend could give a good guide. As Stuff’s Brendan Venter writes, the Hurricanes and Crusaders will supply a huge share of players to the top team this year, and there will be a lot of unspoken competition for places in key positions. Call me biased, but I’d love to see the Hurricanes run them off the park.

Finally, something to listen this weekend: We had a really cool episode of The Offspin come out yesterday, with two people who were right there for Pakistan’s 1992 World Cup triumph. Hamid Ikram was the team’s liaison in New Zealand, and we were joined by him and his son Ali Ikram (who you might know as an excellent broadcaster and writer) to talk about the secret history of Pakistan’s run to the title. The Black Caps play Australia this Sunday, and a semi-final berth looks likely, but a win would lock it in without doubt.

From our partners: A two-tier system of energy use is developing, with those on high incomes much more able to reduce their bills than households on lower incomes. Vector’s Chief Risk and Sustainability Officer Kate Beddoe outlines what the company plans to do about that.

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