Bryce Edwards: Victory for transparency in lobbying reforms

By Bryce Edwards*

Analysis - Two weeks ago Prime Minister Chris Hipkins was pooh-poohing questions about the need for reform lobbying rules, claiming lobbyists have the same access to MPs as any other member of the public. But yesterday he announced a crackdown on lobbyists, claiming he wanted to end the special access lobbyists have to decision-makers.

Hipkins announced three immediate minor reforms, and one big longer-term review of lobbying rules. The immediate tweaks won't change much, but the review to be carried out by the Ministry of Justice could result in exactly the sort of reforms that are necessary to clean up the industry.

Transparency campaigners therefore have reason to tentatively celebrate. It's worth considering what the merits of the four reforms are.

Reform #1: A big review of lobbying

The prime minister has ordered the Ministry of Justice to embark on a review of lobbying in New Zealand, and come up with options for reform. At the top of the list will inevitably be a register of lobbyists and legal stand-down periods for insiders going backward and forwards through the "revolving door" of politics and lobbying.

Hipkins called this a "major piece of work" that will "draw on international best practice". Quite sensibly the investigation will not be rushed, and so will not report back until next year. This is because many of the issues of regulating lobbying are, as Hipkins said yesterday, "complex to work through".

He pointed to the need for the review to learn from former Green MP Holly Walker's 2012 lobbying disclosure bill. This failed because it didn't grasp the complexities of what is required to regulate political activity. And that's one of the biggest lessons for those studying lobbying regulations - there's a need for careful consideration of the regulations, especially to avoid unintended consequences such as regulations having a chilling impact on ordinary citizens who want to lobby politicians.

Hipkins appears to be setting up the review in a way that is likely to obtain multi-partisan support, saying "I want, as much as possible, for this to be a bi-partisan issue and I call on other political parties to support this measure". National has immediately come out in support. And the party that has been pushing hardest on these issues lately - TOP - gave its endorsement of the review yesterday. Outside interest groups seemed to be in favour too - such as the Taxpayers Union.

Of course, the devil could yet be in the detail. New Zealand Herald political reporter Thomas Coughlan rightly says: "With no detail on what this might look like, it's impossible to make a fair assessment of whether it's worthwhile or not." And journalist Max Rashbrooke told the Spinoff yesterday the review was an "insufficient response", and "kicking it out for at least a year raises the possibility that nothing substantive will change."

Reform #2: Abolition of swipe cards

At the moment, Parliament provides swipe cards to lobbyists so that they have the ability to get access to the buildings without having to go through security or book appointments with politicians. As Guyon Espiner explained in his series on lobbying for RNZ, to receive the special accreditation at Parliament lobbyists don't even have to disclose who they are working for. All they need is the sponsorship of an MP or a party's chief of staff. Espiner points out this means, for example, the new chief of staff for Prime Minister Chris Hipkins, "Andrew Kirton, fresh from his lobbying firm, can now grant access to other lobbyists if he wishes".

It's therefore a no-brainer for Hipkins to get rid of this very symbolic part of the lobbying industry. He has written to the Speaker of Parliament to request that the access cards be revoked.

There is a consensus that this won't change anything substantially. Rashbrooke says he's "underwhelmed" by the change. And Coughlan says: "The real work of lobbying happens over the phone, at dinner, and in meetings with ministers - or in the dully transparent grunt work of preparing complicated select committee submissions."

Read more about RNZ's investigation into the lobby industry

• Lobbyist Holly Bennett is lobbying her own colleagues to be more accountable to the public
• Lobbyists in New Zealand enjoy freedoms unlike most other nations in the developed world
• How well-connected lobbyists ask for - and receive - urgent meetings, sensitive information and action on law changes for their corporate clients
• Prime Minister's chief of staff Andrew Kirton led lobbying firm that fought against reforms now binned by Chris Hipkins
• Lobbying firms earning hundreds of thousands from contracts with government agencies

Reform #3: A voluntary code of conduct for lobbyists

It is common overseas for lobbyists to have a code of conduct for how they operate. Hipkins says he wants one established here, and suggests it could be voluntary for lobbyists. He has asked the Ministry of Justice to help the industry establish one. According to Hipkins, the code of conduct "would enhance transparency by, for example, including the names of the clients they represent on their websites".

The fact that the code will be voluntary makes this a particularly questionable reform, and commentary has therefore been derisive. For instance, Coughlan questions how it can possibly be effective: "If the lobbying industry is scary and influential enough to warrant additional regulation, it probably isn't appropriate to ask them how they want to be regulated."

The Taxpayers Union has also protested that the government is funding an initiative that might not be taken up by all lobbyists: "Taxpayers should not be footing the bill for an unenforceable attempt to get lobbyists to behave. Any rules for lobbying should be determined following consultation and should apply equally across the sector."

Coughlan is even more scathing on this: "The fact that lobbying firms will be given free government support for their code of conduct is laughable. If scarce public resources are to be expended on creating the code, it should be mandatory - if firms have no obligation to sign up to this code of conduct, then why should the public be on the hook for resourcing it?"

Reform #4: Changes to the Cabinet Manual about the revolving door

Hipkins has announced that the "Bible of Government", the Cabinet Manual, will be refreshed to give greater guidance to ministers about not allowing future employment as lobbyists to impact on their ministerial decisions. The prime minister says the Cabinet Manual will "make it clear that, while in office, ministers' conduct and decisions should not be influenced by the prospect or expectation of future employment with a particular organisation or sector".

This is the weakest of the four reforms and is being derided by commentators as almost meaningless. Policing the rules will be up to the prime minister, but enormously difficult to enforce. There will still be nothing to stop ministers from taking up lobbying roles soon after leaving office - like Kris Faafoi did last year.

The Government yielded to pressure

There is no doubt that the Labour government has yielded to growing public pressure to tighten up on the access lobbyists and vested interests have to decision-makers.

It was only last year that Faafoi left the Beehive, moving almost straight into lobbying. The government denied this was a problem, or that lobbying needed further regulation. And then two weeks ago the prime minister said he didn't believe that "lobbyists necessarily get preferred access" compared to members of the public.

So what changed? The Faafoi scandal got the ball rolling, and then more recently Espiner's RNZ series on the role of lobbyists close to government started to change the public's perception of the problem.

But it was the Stuart Nash scandal that really moved the dial. A minister was seemingly lobbied on an issue going through Cabinet by his political donors, and he gave them privileged information about what was going on, as well as an indication that he was fighting in Cabinet for a policy change that would benefit their industry.

Despite the fact that the Nash scandal wasn't about traditional consultant lobbyists, it fed into growing public concerns about wealthy vested interests having special access to Cabinet. Hence, according to Coughlan, Espiner's lobbying revelations in combination with Nash scandal, "created an inescapable momentum around the issue" leading to a "belated crackdown".

Similarly, Newshub political editor Jenna Lynch says: "The Stuart Nash story compounded the concerns that were raised a couple of weeks back around lobbying and those two things combined were painting a murky picture about the movings and shakings in Wellington." Therefore, according to Lynch, the Nash scandal meant Labour "needed to reclaim the transparency narrative".

She says that the move yesterday was about rescuing Hipkins' brand: "So much of Hipkins' likeability is linked to trust. Nash and lobbyist access were threatening to chip away at Chippy's honest Kiwi brand. They had to move quickly."

There will be questions about the Labour government's sincerity in reforming lobbying. After all, it's a very rapid change of heart on the matter after years of ignoring it. But that doesn't necessarily mean it won't lead to big progressive changes - especially because the Ministry of Justice will carry out a proper review. It seems inevitable that the Justice Ministry will identify some serious democratic deficits in the current system, and be forced to recommend some major remedies.

But for the moment, the immediate reforms proposed by the government are largely inconsequential. In order to appreciate the degree to which this is true, we need only look at Hipkins' own relationship to lobbying and how little this will change.

Hipkins recently hired lobbyist Andrew Kirton to be his chief of staff. Kirton reportedly left his lobbying job the day before starting his new job running the Beehive. There are some major issues with such lobbyists being invited to the highest jobs in politics.

It's become part of the culture of a revolving door at the top of the Beehive - four out of five of Labour's chiefs of staff since they came to power in 2017 have been lobbyists. And if Labour loses power on 14 October, there will be nothing to stop Hipkins' righthand man from shifting straight back into lobbying, taking all his connections and privileged information to help private sector clients have an advantage in politics.

Sadly, there was nothing in yesterday's announcement to suggest that this reliance on lobbyists at the top of the Beehive might be about to stop.

*Dr Bryce Edwards is a lecturer in Government and Public Policy at Victoria University of Wellington. He is the director of the Democracy Project.

This article was originally published on the Democracy Project.