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Taxpayer Update: Mahuta trying to gag councils on Three Waters | Auditor General slams tourism slush fund | Nats now leading Labour in latest poll

Dear Supporter,

Louis is away today, so I'm in the hot seat bringing you this week's Taxpayer Update.

Taxpayers' Union Curia Poll: Nats pull ahead of Labour

First thing's first: we've just released this month's Taxpayers' Union Curia Poll, which you can read about on our website here.

This is the first time this poll has shown Labour behind National, and also the first time Labour/Greens would not have the numbers to govern. Since our first poll in September last year, Labour has gone from 25% ahead of National to 1% behind.

National is up 3% to take the lead. ACT and Greens both dip below 10%, while the Māori Party bounces up to 3.6%. The other small parties did not poll well, with NZ First at 1.7%, New Conservatives 0.3%, and TOP 1.2%.

Under these numbers, the Māori Party would hold the balance of power.

The numbers on preferred Prime Minster, and favorability ratings, are available on our website.

💧 Three Waters: First a bribe, now a gag clause! Sneaky and desperate measure to stop councils from criticising Government 🤫

Nania Mahuta

From the "I can't believe they'd sink so low" file, Nanaia Mahuta and her Three Waters officials at the Department of Internal Affairs have been caught out badly.

Last year, at the Local Government New Zealand conference, the Prime Minister announced a $2.5 billion fund to bribe incentivise councils to jump on board the Government's Three Waters agenda. Last week, applications opened for the first $500 million.

At the time, we called it out as a slush fund. The councils are being offered the money to spend even on projects that have nothing to do with water infrastructure.

But now we learn there's a catch. Buried in the funding agreement is a sneaky clause preventing the councils who take the money to improve their infrastructure from criticising the Government!

Newshub reports:

A part of the deal has been slammed as a gag order. It states that councils who get the cash "must not at any time do anything which could have an adverse effect on the reputation, good standing or goodwill of the Department of Internal Affairs or the Government".

Along with your humble Taxpayers' Union, the vast majority of mayors and councillors are campaigning against Three Waters. To put elected officials in a position where they must choose whether or not to take money to improve services for their local community, or to fight for affordable, transparent, and accountable/democratic management of the water assets built by generations of ratepayers, is disgraceful.

As an unnamed opposition MP put it, "this is only one step away from forcing councillors to praise our glorious leader at each meeting". Indeed.

The Newshub piece goes on:

In a statement, the Department of Internal Affairs told Newshub "no clause in the Funding Agreement... prevents or prohibits any council from publicly expressing its own views".

It adds: "It is a common and prudent clause in public funding documents as a safeguard to protect against the misuse of public funds."

Mahuta is promising this is no gag order.

This is the real concern though. It's all very well for politicians to stretch the truth, but as public servants, DIA officials must conduct their duties in a fair, impartial, responsible, and trustworthy way.

Here are the words of the clause again plain and simple:

[Councils] must not at any time do anything which could have an adverse effect on the reputation, good standing or goodwill of the Department of Internal Affairs or the Government

The claim that this isn't a gag clause is a simple lie. We also find the statement from the DIA's spokesperson that such a clause is "common" and somehow protects against misuse of funds very difficult to believe.

Your humble Taxpayers' Union has filed an information request to unmask the names of the officials who approved the statement and what other government contracts contain this (apparently) "common" provision.

Instead of bribing councillors and mayors not to speak out against Three Waters, we say the Government should listen to them and their communities and Stop Three Waters. To support the Stop Three Waters effort click here.

Stop Three Waters banner

Update on Three Waters legal challenge: Mahuta cover-up or stuff up? 

You may recall a few months ago we announced our support of a High Court challenge to the advice Nanaia Mahuta provided her Cabinet colleagues to justify the Three Waters model. Specifically, she claimed that the Government's own lawyers had advised her that the co-governenace model was "necessary for the Crown to comply with its obligations under the Treaty of Waitangi". 

Advice from multiple QCs is that Mahuta's advice cannot be a fair reflection of the law. Water infrastructure assets were not in existence in 1840, and while some iwi may have interests in specific and particular water bodies, that could not reasonably be extended to municipal pumps and pipes paid for by ratepayers across the country.

The Government's approach to the case is fascinating and it is surprising the media aren't turning their attention to what is going on.

Ms Mahuta's lawyers are now trying to suppress Minister Mahuta's Cabinet papers containing the above claims, even though her office authorised the public release of the papers last year!

They are trying to prevent our lawyers, the public, or the High Court, being able to refer to what Ms Mahuta was telling her Cabinet colleagues when they decided to adopt the Three Waters proposals. Just what is Ms Mahuta hiding... 

Screen shot

I recently hosted a Zoom call with the lawyers leading this effort and many of our thousands of supporters who have chipped-in financially to make this legal challenge possible. You can read the summary/watch the discussion here.

The sorry saga of the Strategic Tourism Asset Protection fund 💸

Kelvin Davis

David Farrar has been working through the recent report by the Auditor-General on the $290 million "Strategic Tourism Assets Protection Programme" which saw the likes of AJ Hackett Bungy NZ receiving $10.5 million over-and-above the COVID wage subsidy support (we are careful to note that Mr Hackett is no longer involved in the company). Some extracts:

The Tourism Recovery Ministers decided to fund all tourism businesses that scored more than 15 out of 30 points in the assessment process. They also decided to fund all eligible Māori tourism businesses, including those that scored less than 15 out of 30 points in the assessment process.

So if your owners have the right ancestors, you got funding from the Government even if you scored 0/30!

However, all decisions to spend public money come with an obligation to ensure that the decision-making is consistent and transparent. We saw limited evidence explaining the reasons for the decisions. Without those records, those who have made the decisions are not able to adequately explain why funding was provided. In my view, this is not acceptable practice, regardless of the circumstances. To ensure that the public can be confident in the integrity of the decisions made, the reasons for this should be clearly explained and well documented.

In other words, the Auditor General is saying that we can have no idea if Ministers just gave out money to their mates, as there was no documentation of their reasons.

This, combined with the decisions made that diverged from officials’ advice and the limited documentation to explain the divergence, makes it hard to determine whether the funding was applied fairly in accordance with the published criteria and the extent to which it represents value for money.

So Ministers overrode recommendations of neutral officials, without explaining why.

The Tourism Recovery Ministers agreed to fund Whale Watch Kaikōura. We have not seen any evidence to identify what criteria the Tourism Recovery Ministers used when making this decision. We also did not see any advice from Ministry officials. On 10 June 2020, the Minister announced that Whale Watch Kaikōura had been provided $1.5 million grant funding.

So Whale Watch Kaikōura got $1.5 million of taxpayer money from Ministers on the basis of no criteria and no advice.

This really is banana republic stuff and demonstrates why fighting for Lower Taxes, Less Waste, and More Transparency couldn't be more relevant.


Thank you for your support.


Jordan Williams
Executive Director
New Zealand Taxpayers’ Union


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