Part 9: Register of Pecuniary Interests of Members of Parliament

Central government: Results of the 2004-05 audits.

9.1
Amendments to the Standing Orders of the House of Representatives in 2005 established a Register of Pecuniary Interests of Members of Parliament (the register).1 The Auditor-General has been given certain functions in relation to the register.

9.2
In this Part, we describe the register and, in particular, the Auditor-General’s new functions.

Purpose and scope of the register

9.3
The new Standing Order requires members of Parliament to record and disclose certain personal financial interests. Members must disclose such things as business interests, employment, trusts, involvement in organisations seeking government funding, real estate, debts, overseas travel, and gifts.

9.4
In general, members of Parliament must file a return after being elected, and annually each February. The first returns were due to be filed in early 2006.

9.5
The register comprises all returns submitted by members.

9.6
Only the fact of a personal financial interest is required to be recorded in the register, not its value. The register is not designed to be a “register of wealth”.

9.7
The purpose of the register is to promote greater transparency, openness, and accountability in the parliamentary process. It ought to strengthen public trust and confidence in the integrity of members of Parliament and, more broadly, the public sector. It brings Parliament into line with similar requirements that already exist for Ministers2 and for members of legislatures in several other Commonwealth countries.

9.8
The register will be a useful tool to help identify and avoid possible conflicts of interest. However, by itself the register will not necessarily prevent or detect abuses of public office by members of Parliament; nor is it designed to do so. It only records interests. It does not record particular instances of conflicts of interest; nor does it address how a member should act when a conflict of interest does arise. Separate requirements for express disclosure where a financial conflict of interest arises in a specific situation in the House already exist for members of Parliament.3

9.9
Formally disclosing the personal financial interests of members of Parliament can help ensure that any conflicts of interest that arise are identified and carefully managed before they cause trouble. Such a disclosure minimises any temptation for a member to use their office for personal pecuniary benefit, and also reduces the potential for false allegations of improper behaviour.

9.10
A registrar is appointed to compile and maintain the register, and to provide advice and guidance to members about their obligations. The inaugural registrar is a former Ombudsman, Judge Anand Satyanand.

9.11
The registrar publishes – on a website and in booklet form – a summary containing a description of the information in the returns.4 The full returns themselves are not made public.

The Auditor-General’s functions

9.12
The registrar supplies copies of members’ returns to the Auditor-General. The Auditor-General has certain functions in relation to them. These functions are:

  • review of returns (which is mandatory); and
  • inquiry and report (which are discretionary).

9.13
The review function is –

The Auditor-General will review the returns provided [by the registrar] as soon as is reasonably practicable.5

9.14
The inquiry and report functions are –

The Auditor-General may inquire, either on request or on the Auditor-General’s own initiative, into any issue as to whether –

(a) any member has complied, or is complying, with his or her obligations under [the provisions relating to the register], or

(b) the registrar has complied, or is complying, with his or her obligations under [the provisions relating to the register].

The Auditor-General may, after he or she has completed an inquiry …, report to the House the findings of the inquiry and any other matter that the Auditor-General considers it desirable to report on.6

Review

9.15
We do not intend the regular review of returns to involve a detailed audit. Our review will not attempt to verify or certify that the details in every return are accurate and comprehensive, and we do not propose to investigate the interests or activities of members of Parliament beyond what is contained in returns. To do this would involve obtaining separate information from each member to check the veracity of the interests disclosed (for example, proof of share ownership). To do this annually for every member would be time-consuming and unnecessarily invasive of personal privacy. It would be almost impossible to give positive assurance that every member had declared all applicable interests.

9.16
Our review of returns will enable us to check generally that all members have filed a return in the correct form and at the correct time, and whether the return appears to address all the necessary matters. Our knowledge of the contents of each member’s return will help us decide when to exercise the inquiry function.

Inquiry

9.17
We will address serious questions about the truthfulness of a particular member’s return on a case-by-case basis by conducting an inquiry. This is where we would, if necessary, verify precise details of a member’s return. The primary focus of an inquiry would be on fact-finding. We would ordinarily report the findings of any such inquiry to the House of Representatives.

9.18
We can begin an inquiry on our own initiative or on request. For instance, we may begin an inquiry as a result of our review of returns, in response to concerns raised in the media, or after receiving a complaint from a member of the public or another member of Parliament.

9.19
We envisage that, in practice, our inquiry function will be exercised rarely.

Other consequences

9.20
The Standing Orders provide that a member of Parliament who knowingly fails to file a return when required, or who knowingly provides false or misleading information in a return, may be in contempt of the House. However, we would not be responsible for taking enforcement action against a member who has not complied with their obligations. As with most of our other functions, our role is simply to report our findings. Any further action against a member would be a matter for the House.

Summary

9.21
Our practice of reviews and inquiries is likely to develop over time. We expect to liaise closely with the registrar over the implementation of the register, especially in the early days as members of Parliament get used to these new requirements.

9.22
Sound processes and openness in managing conflicts of interest are essential to maintaining the integrity of Parliament. The register ought to assist this. We anticipate that our involvement will provide an additional measure of assurance over the operation of the register.

1: See Standing Order 164 and Appendix B of the Standing Orders of the House of Representatives.

2: See the Cabinet Manual, paragraphs 2.52-2.55.

3: See Standing Orders 165-167.

4: The registrar also publishes explanatory notes and forms to assist members of Parliament to comply with their obligations. See http://www.clerk.parliament.govt.nz/Publications/Other/.

5: Clause 15(1) of Appendix B.

6: Clauses 15(2) and 15(3) of Appendix B.

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