The State Services Commissioner is defending the Minister Responsible for the Earthquake Commission, whose terse exchange of letters led to the EQC board chair’s resignation. David Williams reports.

State Services Commissioner Peter Hughes has been rolled out to defend Megan Woods’ appointment of a ministerial adviser to the Earthquake Commission.

Instead of answering questions about the advice she received on the appointment, Woods’ office provided Newsroom with a statement from Hughes. The statement says ministers can take advice from a range of sources and Woods asked him to make available a senior public servant, who will work with EQC’s board and management.

“This is an appropriate course of action for the minister to take.”

The high-powered defence of Woods’ appointment comes after last month’s high-profile resignation of EQC board chairman Sir Maarten Wevers. At a hastily arranged press conference, Woods announced Wevers had stepped down after she outlined her intention to appoint the adviser to try and speed up settlement of the remaining 2600 Canterbury earthquake claims. Last week, Newsroom published letters exchanged by the pair, including Woods’ warning of a looming board shake-up.

(It was announced last week that the ministerial adviser is Christine Stevenson, the deputy chief executive of Department of Corrections, while EQC’s interim chair is former Labour Party deputy leader Dame Annette King.)

In an interview with Newsroom, Wevers questions the legal basis for the adviser’s appointment – “we’re not a government department”.

“It’s not the role of the minister to helicopter somebody in to an organisation and just say to the board I’m going to do it,” he says. “She’s talked publicly about wanting to work with management to improve things; we want to improve things too. But it’s not her role to work directly with management. That’s my view.”

The Crown Entities Act gives the board authority to exercise the powers and functions of the Earthquake Commission. And under the Earthquake Commission Act, the minister can issue directives – something former minister Gerry Brownlee did several times. Wevers says there’s a process for that, which involves to-ing and fro-ing between the minister and board.

(Brownlee didn’t respond to a request for comment.)

“If the wheels are falling off it’s actually the responsibility for our ministers to pull some levers to try and sort them out.” – Dean Knight

Wevers says the board would have considered any advice for speeding up the settlement of claims. “But this is the role of the board and management to do that. And we can discuss it with the minister.”

Public law specialist Dean Knight, a senior lecturer at Victoria University of Wellington’s School of Law, isn’t surprised the minister might want greater control or monitoring over EQC. “She, ultimately, is accountable to Parliament and the electorate for what she does. In light of the despair of some of the people in Canterbury that’s been reported, there are question marks about how well that agency is functioning.”

He adds: “If the wheels are falling off it’s actually the responsibility for our ministers to pull some levers to try and sort them out.”

Former State Services Minister Paul East, a Queen’s Counsel and consultant for Bell Gully, also endorses the appointment of the adviser. “I think it’s important that a minister has confidence in the chief executive of the department that they’re responsible for.”

Figures provided by EQC show the public narrative about the Canterbury quake claims – that thousands of people have been languishing in limbo for years – is false. As of January 31, EQC had just over 2600 claims related to the 2010 and 2011 quakes – excluding the 400-odd that are involved in court action. Most of those claims were lodged over the last 12 months. Only 226 pre-date 2016.

Wevers says early last year, EQC had a touch over 10,000 claims on its books. Within 12 months all but 750 had been dealt with. Many of the new claims, he says, relate to damage found after recent property purchases, of houses that have already been repaired or rebuilt.

“But the public discourse is they’ve been seven years in limbo. Well that’s a complete mischaracterisation of what it is. And the other thing is that not all of these claims will result in claims being accepted.”

Meetings or briefings?

Wevers says EQC never provided Woods with detailed advice about the nature of those outstanding Canterbury quake claims – and she never sought it.

Woods’ office counters that. A spokesman says the minister met with Wevers and EQC chief executive Sid Miller on October 30 and November 30 last year and on February 21. She met Miller and other EQC officials on February 14 and met the EQC board on November 28.

Woods’ spokesman says: “The minister has raised the issue of outstanding Canterbury earthquake claims with EQC, including a strong expectation that they need to be settled fairly and swiftly, on every occasion she has met with them.”

He adds: “Advice the minister has received from private insurance companies in relation to EQC was also discussed with EQC at these meetings, including private insurers’ concerns regarding the lack of accurate and reliable claims data which was discussed at the meeting with EQC on 21 February.”

Wevers says he realised he was part of the problem Woods had with EQC’s performance.

“I said to the minister, ‘I didn’t have to take this job on, minister’. And I didn’t. I’d finished eight years in the Beehive as the head of the PM’s department, for two prime ministers, which is not the easiest job in the country, I can tell you that.

“I stuck it out for nearly five years. It needed people to come in and help Canterbury get back on its feet, and that’s why everybody came to help.”

David Williams is Newsroom's environment editor, South Island correspondent and investigative writer.

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