All In The (Mahuta) Family Part 5 – The Only Experts

This is Part 5 of The Daily Examiner’s article series on Labour Minister Nanaia Mahuta & egregious conflicts of interest involving her family. Part 1 “All In The (Mahuta) Family” was published on 14 May 2022 and Part 2 “All In The (Mahuta) Family – Taxpayer-Funded Empire Over Water” was published on 22 May 2022. “All In The (Mahuta) Family Part 3 – Follow The Money” was published on 29 May 2022. “All In The (Mahuta) Family Part 4 – Maniapoto” was published on 5 June 2022. All research & original coverage credit for Parts 1-4 to Twitter profile @kehetauhauaga, which has been tweeting this since 6 May 2022. Research & original coverage credit for this article to Twitter profile @Record_Factory and also to @kehetauhauaga.

Previous articles have highlighted the close involvement of members of NZ Cabinet Minister Nanaia Mahuta’s family, including her husband and sister, in both statutory and advisory roles for the NZ Government. This article reveals the procurement process undertaken by the Ministry for the Environment for some of those roles, that it was not an open and competitive process, that the individuals were directly appointed instead.

Ropu of Maori Experts for Waste Strategy

While Nanaia Mahuta was Associate Minister for the Environment in early 2021, it was announced that the Ministry for the Environment had appointed an expert Maori panel to “guide the development of the new Waste Strategy” for the country.

The announcement provided the composition of the panel, which included William Gannin Ormsby (cousin & husband of Nanaia Mahuta) and two of his relatives, Tamoko Ormsby and his wife Waimirirangi Ormsby. Together, those 3 individuals are Directors of Ka Awatea Services Ltd, with Gannin Ormsby as the sole shareholder. Part 3 of this article series outlines the payments that have been made by the Ministry for the Environment to Ka Awatea Services and Kawai Catalyst Limited, which consists of the couple, Tamoko Ormsby and Waimirirangi Ormsby. The graphic from that article is reproduced below to recap the relationships.

Ministry Procurement Process

OIA responses

Following independent media coverage of the appointment of Mahuta’s relatives onto the ropu and payments made to the 2 companies owned by the Ormsbys, an OIA request was submitted for information on the Ministry for the Environment’s procurement process for this panel.

On 10 June 2022, the NZ Ministry for the Environment published 2 Official Information Act responses on its website, both in relation to the procurement process for its expert Maori panel on the Waste Strategy for NZ. Accompanying both responses are identical lists of 13 documents including the Waste Strategy plan, the procurement plan for the expert panel and CVs for the panel members.

Direct Procurement Process

The procurement plan clearly states that the process was not open and publicly contested, that in essence the panel members were directly sourced and appointed.

Ministry staff were fully aware that this “direct source procurement approach” represented a “major appearance risk”. Yet as above they had simultaneously already concluded there was an “extremely limited pool of expertise” which supported their assumption that “there was likely to be little value in attempting a public/open procurement process”.

The Ministry also attempts to justify the direct procurement on a tight timetable whereby a Cabinet paper was required by Feb 2021. But in a Cabinet briefing paper from 8 April 21, Minister Parker merely notes that they are working with a “Māori expert group to develop a conceptual framework”. So the time pressure does  not seem to have existed, and indeed it is not apparent in any Cabinet papers from 2021 where the work of this expert group is set out (or summarised).

This circular logic of not advertising the roles due to a belief that there was a lack of candidates in the market could perhaps be excused if no conflict existed. But as a “major appearance risk” had already been identified due to the conflict, surely it was even more incumbent on Ministry staff to conduct a fair and open application process. In other words, the Ministry was fully aware of the major conflict perception risk and yet still consciously chose not to allow anyone else to apply for the roles.

Direct Procurement – “Skilled support”

The above only covers three of the five members. Tamoko & Waimirirangi Ormsby were hired under a separate procurement plan calling for “skilled support for the ropu ‐ someone who can work closely with them and “hold the pen”.

Even for this far more generic capability, the Ministry decided against running an open and public process and instead concluded that the only supplier who could carry out this function was Gannin’s relatives’ Kawai Catalyst Ltd (or misspelled as Kiwi Catalyst). Again, the Ministry set aside all normal public procurement principles and went straight to appointing further Ormsby family members without an open and competitive process.

The mere fact that Tamoko and Waimirirangi themselves are a couple is highly unusual in itself and should have given pause. It is even more unusual that the Ministry’s senior leadership were happy to rubberstamp this non-transparent and uncompetitive process, despite the sensitive family connections and obvious youth and inexperience in Tamoko and Waimirirangi.

It is remarkable that the Ministry states that in respect of needing Tamoko/Waimirirangi’s services that “we have not been able to identify any providers offering similar services at present”. That is likely because an open, public and advertised process was not conducted. Had the Ministry done so, it is entirely possible it would have.

It is also significant that the Ministry recognised that Tamoko/Waimirirangi are a “young couple” operating Kawai Catalyst Ltd on their own but still thought it entirely proper to not even propose to conduct an open and competitive process.

While the Ministry consulted the Public Service Commission on Gannin Ormsby’s appointment, it does not appear to have when recruiting Tamoko/Waimirirangi. Despite now forming a highly unusual familial contract bolt-on “chain” to further Ormsby family members, the Ministry simply concluded that “we consider that the same approach applies in this case” in terms of the family conflict being acceptable in the Public Service Commission’s eyes.

Mahuta’s Breakfast

Nanaia Mahuta attended the start of the initial exploratory meeting between Ministry officials and the Ormsbys, in early September 2020. This was disclosed in the main OIA response. The response suggests that “the Maori experts” had already been decided upon for the waste strategy project, as they are part of the hui.

While the Ministry states that Mahuta “did not engage in any substantive discussion with officials and left before the working sessions began”, this is exactly why conflict policies exist – to avoid situations like this. This situation – observing Ormsby in close proximity – would have understandably put officials in an invidious position with respect to the contractual relationship and its evolution.

Conclusion

In summary,

  • The Ministry for the Environment identified a need for the ropu.
  • Like all professional consultancy roles they attracted significant day rates ($1000 p/day).
  • The Ministry proceeded to offer these roles to three close members of Mahuta’s family without any open and competitive process.
  • The NZ public has no way of validating the veracity of the Ministry’s claim that no one else suitable was available throughout the entirety of NZ. If it had been advertised, then we could assess the suitability of other applicants and judge their merit.
  • It is remarkable that the Ministry accepted there was a “major appearance risk” but made no attempt to mitigate the appearance that the Ormsbys may have been appointed ahead of more suitable candidates.
  • Mitigations were put in place to manage the conflict post-appointment. This was obviously necessary but without an open and competitive process, such attempts to retrospectively remedy the appearance perception risk are implausible.

The question then arises for Sam Buckle, Ministry for the Environment Deputy Secretary, as to why he was satisfied that not following an open process mitigated the “major appearance risk”.

Simply declaring a conflict exists does not mitigate it. The appearance is that close relatives of Mahuta were given highly paid government contracts without the wider industry being given any open and transparent opportunity to also apply. To date the Ministry has not provided any evidence to demonstrate that that was not the case. It could be argued that is not compatible with the standards expected of public sector procurement probity in NZ.

Rule 13 of the Government Procurement Rules state that ‘wherever possible an agency should use open competitive processes’. As Twitter profile @Record_Factory asks, “Is it really credible that it wasn’t fundamentally possible for MfE to follow one in this instance?”

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