In this evidence to the High Court case of Winston Peters vs Paula Bennett, Anne Tolley and the Crown over his superannuation leak, Sir Maarten Wevers, the former head of the Prime Minister’s Department outlines NZ’s governing arrangements. Here, in Part 2, he looks at how chief executives should work with their ministers. In the first part Sir Maarten addresses the system of government, cabinet, ministers and the public service.
Chief Executives
Chief Executives head departments. Chief Executives are responsible to their Ministers for the performance of their departments.
Chief Executives are appointed and their performance is overseen and reviewed by the State Services Commissioner, under the State Sector Act. The State Services Commissioner’s independent role in appointing Chief Executives and the independence of Chief Executives in matters concerning their departmental employees underpin the neutrality of the Public Service.
A key responsibility of a Chief Executive is to ensure that the Minister has confidence that the department is always acting with political neutrality and within the law, is performing well in service delivery, delivering value, and achieving the objectives set for it in the government’s work programme. A Minister will also want to be assured that linkages with other departments are effective and appropriate and that agencies are working collaboratively to get improved results.
The frequency and regularity of engagements between Ministers and their Chief Executives is principally a matter for a Minister to determine. In my experience arrangements vary a great deal, depending on the department and the personalities and working style of the Minister and their Chief Executive, the issues at hand, diary pressures, travel arrangements, whether or not there are Associate Ministers, and so on. The key point from my perspective is that the principal obligation for ensuring that there is a professional and constructive relationship with the Minister rests with the Chief Executive. Whether or not an individual Chief Executive personally supports a particular policy the Minister or the Government is pursuing is beside the point.
To illustrate, when I was Chief Executive of DPMC I was once asked by a group of visitors what I thought about a particular opposition party’s policy and I said I did not have a view. They seemed surprised. I explained to them that it was not my job to have a view about the political position that was taken by political parties either in the run-up to an election or when they were in office. A Chief Executive is there to support the duly elected and appointed Minister who is serving in the government of the day. If the policy is to go in a particular direction then your responsibility as a public servant is to recognise that and to provide, to the very best of your ability, advice about how the objectives associated with that direction can be achieved, what the pathways are for most effective achievement, the risks and costs and implications for other programmes, and so forth.
If a Minister proceeds with a particular policy strategy, then she or he is accountable to the House and the public for whether or not it succeeds. Clearly the Chief Executive and the agency concerned also has a major role to play in achieving the desired results. But both the Minister and the agency have responsibilities. A public servant can be called before a Select Committee to be questioned about a particular programme, but the Minister is the one with accountability to the House. For a public servant, the question of whether or not a policy or initiative is going to be popular, or defensible in public, is a matter for the Minister, not them. Whether other parties will support or criticise is, likewise, something that rests with the Minister wearing a political hat. It is the Minister’s role and responsibility, to defend, to advocate and to build support for the policy line they have decided to take. It is the Chief Executive’s role and responsibility to implement, as effectively and efficiently as possible, the policies that are adopted by the Minister or government of the day.
The role of being a Chief Executive is enormously challenging. You have to deal with whichever Minister is appointed, and do your best to make the relationship work. You must provide free and frank, and I would say, fearless, advice, which may or may not be welcomed or acted upon. You are responsible for recruiting and managing and leading the staff of your agency, and ensuring that they perform in accordance with the attributes of the New Zealand Public Service. As a matter of course, you are responsible for the delivery of the agency’s services to client groups, providing advice and support, executing any new policy development and new service delivery functions, managing risks, technological change and relationships with numerous third parties, and contributing to and at times leading sector and whole of government collaboration. Attracting, recruiting and retaining quality people to fill Chief Executive roles is a matter of great significance.
It is the nature of the small and intimate government in New Zealand that Ministers are regularly briefed by advisers, including departmental Chief Executives.
The approach that a particular Chief Executive might take to briefing his or her Minister will be influenced by the importance, urgency and sensitivity of the information, but also by the relationship they have with their Minister. I would assess that in cases that were urgent or important, Ministers in New Zealand would almost certainly agree quite quickly to grant a request for a meeting with their Chief Executive. That is a good thing, and how the system should work in my view.
Some briefings will be scheduled on a recurring basis, for example, before Cabinet on a Monday morning. Other briefings might be of a more ad hoc nature, at the request of the Minister, or scheduled around a Cabinet Committee meeting, or prior to a meeting a Minister has scheduled with a third party. A Minister may also ask to be briefed on an event, an issue or an operational matter that they have a particular interest in.
Decisions by a Chief Executive on when and over what matters to request to brief a Minister that is not part of a scheduled meeting always involve questions of judgement. Ministers are busy people, and a Chief Executive needs to ensure that demands on the Ministerial diary are appropriately calibrated, and are mindful of what else the Minister may be dealing with at the time.
Briefings involving sensitive information
The responsibilities of most Ministers are such that it is likely that briefings to Ministers will routinely include sensitive material.
The sensitivity may relate to matters ranging from national security, commercially sensitive negotiations, budget sensitive decisions, diplomatically confidential disputes, stakeholder relationships or matters affecting individuals or groups that are personal or confidential to them. The fact that such matters may be discussed with Ministers is recognised in a number of places in the Cabinet Manual – examples being paragraphs 8.11 to 8.13 (which address information relating to commercial entities) and paragraphs 8.71 to 8.74 (which address personal information).
Examples of briefings relating to individuals could include:
The Chief Executive of the Department of Corrections might brief the Minister of Corrections on a high profile individual who is coming up for parole;
The Secretary for Justice (as the Chief Executive of the Ministry of Justice) might brief the Minister of Justice on a high profile individual who is subject to an extradition request by a foreign government;
The Secretary for Transport (as the Chief Executive of the Ministry of Transport) might brief the Minister of Transport on a failure to meet transport safety standards by a particular provider;
The State Services Commissioner might brief the Minister of State Services on the leak by a public servant of sensitive information, or on performance issues with a named Chief Executive, or particular difficulties a Chief Executive was having with another Minister or with senior public servants in their department; and
The Chief Executive of the Ministry of Business, Innovation and Employment (MBIE) might brief the Minister of Immigration on concerns that Immigration New Zealand have about an application for residency by a named individual.
Briefings which involve national security considerations have particular arrangements in place around them, including very limited attendance by other parties, and generally participation only by those with an appropriate security clearance. It should be noted that Ministers with national security responsibilities are not required to hold a security clearance to receive classified information, but do normally receive a security briefing from the NZSIS before receiving classified material. More generally, Ministers as a whole are not required to undergo security vetting upon being sworn into office. Our Westminster system operates on the basis that Ministers are to be trusted.
As a corollary of the reality that Ministers in practice regularly require and receive briefings containing sensitive information, it is obviously expected that Ministers will not use the information that they receive to their personal or political advantage. This is fundamental. This expectation can be seen in paragraphs 2.65, 2.106, 8.9 and 8.11 to 8.13 of the Cabinet Manual. The Cabinet Manual also addresses, in paragraphs 8.120 to 8.123, the expectation of non-disclosure of official information by former Ministers.
Chief Executives are entitled to expect Ministers to uphold these expectations. Indeed, they could not perform their roles on any other basis.
Chief Executives are also entitled to rely on Ministers to honour the expectation that they will act lawfully and behave in a way that upholds and is seen to uphold the highest ethical standards. This is an obligation on all Ministers. It is addressed in paragraphs 2.55 to 2.56 of the Cabinet Manual.
It would be quite improper for a Chief Executive to attempt to ‘filter’ information that a Minister is entitled to receive on the basis of any assessment that a Minister might act inappropriately. That would be a fundamental breach of the obligations of political neutrality, putting the Chief Executive into some sort of gate keeper role making decisions based on his or her views of the likely political or personal attributes of the Minister. It is the Minister and not the Chief Executive who is accountable to the House for the performance of their portfolio, and Chief Executives are obliged to provide their Ministers with information and advice to support that accountability, regardless of who fills that role. If a Chief Executive had genuine concerns about the conduct of their Minister, that would be a matter for them to raise with the Chief Executive of the Department of the Prime Minister and Cabinet or the State Services Commissioner, who in turn might take the matter to the Prime Minister. Responsibility for the conduct and discipline of Ministers lies with the Prime Minister, not government officials.
Briefings on operational matters
Mr Peters at paragraphs 93 and 126-127 of his brief of evidence suggests that Ministers have no responsibility for operational matters, and a briefing could not be given where the matter was of an operational kind. The statement that Ministers have no responsibility for operational matters is incorrect, for the reasons I have already discussed. Ministers are accountable for such matters to the House. The suggestion that a ‘no surprises’ briefing (or any other kind of briefing) is not permitted on an operational matter is not correct.
Paragraph 3.7 of the Cabinet Manual recognises that it is fundamental that the accountability of Ministers to the House, and therefore to the public, extends to operational matters associated with their portfolio departments. It will not necessarily be the case that the Minister is expected to do anything more than note the information provided. For example, paragraph 3.22(b) of the Cabinet Manual recognises that briefings may be provided for the Minister’s information only. Consistent with that, a Chief Executive would be expected to inform their Minister of significant or controversial operational issues, and would usually do so on a routine basis.
Drawing on my own experience as Chief Executive of DPMC and as a member of the senior management group of the Ministry of Foreign Affairs and Trade, the kinds of operational matters that were raised at Ministerial level (whether on a ‘no surprises’ basis or otherwise) include:
A major construction project;
A proposal to establish a shared back-office capability between agencies;
Major contracts relating to service delivery;
Notification of trade disputes that a foreign State had initiated against New Zealand;
Human resource issues, such as serious misconduct, key role appointments, or matters relating to organisational culture;
A proposed official visit to New Zealand, including where there were disputes about the itinerary or arrangements; and
The organisation of a major international conference
Contrary to what Mr Peters suggests in paragraphs 95 and 131 to 132 of his brief of evidence, whether or not it is appropriate to brief a Minister on matters such as these does not depend on whether the department ‘requires the assistance’ of the Minister or of Cabinet. I have not heard of the criteria that Mr Peters refers to in those paragraphs before, nor am I aware that they have ever been applied in practice, and I note that they are not referred to in the Cabinet Manual. As I explained earlier, a briefing may be to keep the Minister informed, without requiring any decision or assistance.
Briefings under the ‘no surprises’ principle
Briefings by a Chief Executive on a point that their Minister has not requested will sometimes involve what are referred to as ‘no surprises’ briefings.
A ‘no surprises’ briefing is intended to inform a Minister promptly of matters of significance within his or her portfolio responsibilities, particularly where the matters may be controversial or may become the subject of public debate.
Some ‘no surprises’ briefings will include information that is sensitive for one or more of the reasons I identified earlier. Others will not. Often ‘no surprises’ briefings will relate to operational matters, as those tend to be the sort of issues that arise unexpectedly.
‘No surprises’ briefings are addressed in paragraph 3.22 of the 2017 Cabinet Manual in particular, but also in paragraphs 3.13, 3.70, 3.74 and 8.53 of the Manual.
In preparing this evidence I have reviewed the earlier Cabinet Manuals in place before the current 2017 Manual. References to Ministers needing to be given ‘early warning’ of matters of significance, or which might become public, go back at least to the 1991 Cabinet Manual. By the time I joined DPMC the ‘no surprises’ principle was well established as a practice.
The purpose of a ‘no surprises’ briefing is to ensure that a Minister is aware of significant matters within the portfolios that she or he is accountable for, because of that accountability. The Minister may want to take action about the matter, or be kept informed or take further advice about the matter. The Minister may also want to know about the matter in order to be prepared to answer questions if they arise, from any source – from Ministerial colleagues, from members of the public, from the media, or in the House. The ‘no surprises’ principle supports individual ministerial responsibility.
The ‘no surprises’ principle also helps to underpin the relationship of trust and confidence that needs to exist between a Minister and their Chief Executive, in order for that relationship to be effective in practice. If a fuse is burning on an issue that is likely to blow up, or there are operational issues or problems that might lead to a Minister being ambushed when he or she steps off a plane or in Parliamentary question time, Ministers expect to be forewarned. They do not like there to be a perception that they have been ‘caught napping’ because a piece of information that their Chief Executive knew in connection with their portfolio was held back from them.
The ‘no surprises’ principle can be seen as important to our Westminster system of government because it helps to promote public trust and confidence in the integrity of departments as institutions of government. That trust and confidence might be shaken, and the integrity of public institutions undermined, if the Minister who is accountable for the department cannot demonstrate to the public competence and confidence in relation to significant or controversial matters concerning the department and its operations.
In practice, the ‘no surprises’ principle can require difficult judgement calls to be made under the pressures of time and competing demands for attention. For example, Chief Executives are not able to choose when an unexpected situation arises or evolves – they have to deal with it in real time. As a result, Chief Executives need to make a judgement call in deciding whether, and sometimes more importantly, when and to what level of detail to give a ‘no surprises’ briefing to their Minister. Those are judgement calls that reasonable and experienced Chief Executives could reach different decisions on without being wrong.
Also relevant is that the information that is the subject of ‘no surprises’ briefings often concerns things that may come at a Minister from outside and from a quarter they do not expect. It could be another MP, or a complainant, or the media. And with the media the source of the information could be someone within a department who leaked it. This is not to say that Chief Executives should not trust their own staff, but more realistically to recognise that information can be leaked and it sometimes is.
‘No surprises’ briefings are also not limited to matters that may become public. I am aware of and I have myself provided ‘no surprises’ briefings on matters that did not become public. They could for example relate to matters where the Minister might be contacted by a colleague or by a stakeholder involved in a matter being handled by the department.
Because it is all such a matter of judgement, some care is needed when looking at ‘no surprises’ briefings with the benefit of hindsight. It is also important to remember that Chief Executives are appointed with the trusted expertise and experience to make the sometimes hard judgement calls of this kind.
Briefings on evolving matters
Mr Peters suggests at paragraphs 88 and 120 of his brief of evidence that a ‘no surprises’ briefing could not be given where the matter had not been the subject of a final report. I do not understand the ‘no surprises’ principle to be limited in that way.
‘No surprises’ briefings are in the nature of a timely heads-up and, in my view and experience, they are appropriately provided even where there is a degree of uncertainty as to circumstances or events in issue. They certainly should not wait until a matter has been concluded and the department has finished their internal final reporting processes, which may not be for some time. For example, the Minister of Health would expect to be informed of a major water contamination issue prior to the Ministry of Health reaching the end of an investigative process and completing its final report on what caused it.
Briefings during pre-election periods
Under our Westminster system the government has the right to govern until the general election. The caretaker convention does not apply in the pre- election period in New Zealand, unless the government has lost the confidence of the House before then. In cases other than this one, the government has full power and authority to make decisions in the pre-election period.
Successive governments have, however, chosen to restrict certain actions to some extent in the period leading up to the election – recognising that a change in government is potentially imminent. Restraint is exercised in making significant appointments, and in relation to government advertising. This is recognised in paragraphs 6.9 to 6.10 of the Cabinet Manual.
In the main, the Public Service expectations during the election period are about heightened awareness due to the context.
I disagree with the suggestion by Mr Peters in paragraph 121 of his brief of evidence that Ministers are not entitled to receive ‘no surprises’ briefings inside three months before a general election. Under our Westminster system Ministers have full authority until such time as their warrant is revoked, and remain fully accountable for the departments in their portfolio. If a matter comes up during this period that a Minister should be briefed on, including on a ‘no surprises’ basis, the up-coming election context does not mean that the briefing should be withheld.
The ‘no surprises’ briefing by Brendan Boyle
In my opinion, based on my experience, it was appropriate for Mr Boyle to brief Minister Tolley on a ‘no surprises’ basis in the circumstances here. The factors that were in my view particularly relevant to, and supported the taking of that action, are:
A high profile, notable and very powerful public figure had received money through the State benefit system that he was not entitled to.
That followed an error he had made on the form that he had confirmed was correct by way of a statutory declaration.
That individual was a former Cabinet Minister, a sitting senior (in terms of his experience) MP and the leader of a political party that might have a role in the formation of the next government.
As a result there were issues in play as to the integrity of the system. There was a risk of perception of special treatment due to Mr Peters’ personal power and his political influence. The receipt of the overpayments was long-standing, as I understand it a period of some seven years. It was not a one-off transgression with minor financial implications for MSD or for Mr Peters.
At the same time the disclosure by Metiria Turei, the co-leader of the Green Party, that she had made false claims to receive higher benefit payments was receiving a high level of media attention.
Together, these factors meant that the overpayment to Mr Peters and MSD’s response to it was a matter that was significant, because it could call into question the integrity of MSD’s operation of the benefit system. There was also the potential for it to become controversial and a matter of public debate.
The fact that this was in the lead up to the election did not make the matter any less significant, or less likely to be controversial – in fact the opposite. Of course it made the information even more sensitive, and Mr Boyle needed to, and apparently did, bear that in mind.
In terms of the judgement call that Mr Boyle made it is also significant that he sought advice. He did not rush to judgement. He consulted with the State Services Commissioner, as he is perfectly entitled to do – and as I would have fully expected him to do – on a tricky issue such as this, which involved the interface between the State Sector and a senior politician. As I said earlier, Public Sector neutrality is very important, and for Brendan to seek the assistance of the State Services Commissioner is in itself part of the buttressing of the advice and the maintaining of political neutrality.
In my view, Mr Boyle’s briefing met the expectations for a ‘no surprises’ briefing as set out in the Cabinet Manual. Given what was going on with Ms Turei at the same time, this was a matter of potentially high public interest. That is the context in which if Mr Peters’ affairs did become public it could be considered that something similar had emerged; another MP had also made a wrong declaration; another MP had also received State money they were not entitled to. There was a risk that this was going to end up in the public domain and that the Minister was going to be blindsided by it if she had not received a briefing. Ministers would expect to be forewarned about this and to be assured that the MSD had handled the matter appropriately, so they could answer appropriately and diffuse any suggestion that there had been preferential treatment. Issues like this move fast, and the timing of such assurances can be critical for public confidence.
Mr Peters at paragraph 126 of his brief of evidence appears to suggest that file notes should be made recording any ‘no surprises’ briefing. I do not understand the ‘no surprises’ principle to require a file note to be taken of every briefing. My own experience was that it was common for briefings to be provided to Ministers orally, and I certainly did not take file notes of every briefing that I gave to a Minister. That was a judgement call I made depending on the circumstances.
The ‘no surprises’ briefing by Peter Hughes
In terms of the judgement call that Mr Hughes made to provide a briefing to his Minister, in my opinion that too was consistent with the ‘no surprises’ principle as I understand it. As I explained in relation to the ‘no surprises’ briefing by Mr Boyle, there was a risk these matters might become known in the public domain, and they related to standards of conduct in the public sector and the integrity of the MSD’s systems in how they dealt with the overpayment. These are core matters which the State Services Commissioner and his Minister are the custodian of. In the same position, I would have taken the same course.
Part 1, covering the general governing arrangements of NZ, is here.
Sir Maarten Wevers had 35 years of experience in the state sector, mainly in the public service, and worked directly with or for five different Prime Ministers: The Rt. Hon. David Lange, The Rt. Hon. Jim Bolger, The Rt. Hon. Dame Jenny Shipley, The Rt. Hon. Helen Clark and The Rt. Hon. Sir John Key. He gave this evidence as an expert witness for the Crown defendants in the Winston Peters superannuation leak case in the High Court at Auckland – the Attorney-General on behalf of the Ministry of Social Development, its former chief executive Brendan Boyle and the State Services Commissioner, Peter Hughes.
