Action point 2: Slow the “revolving door” between government and lobbying roles
Internationally, it is standard practice for there to be a “stand-down” (or “cooling off”) period for Ministers and their staff before they move into lobbying roles. New Zealand currently has no cooling off period at all.
The term ‘revolving door’ describes the movement of former ministers, their staff or senior public servants moving directly into industry lobbying roles. The revolving door creates the risk that insider knowledge and access to confidential state information can be used for private benefit and unfair advantage.
The revolving door also works in reverse when lobbyists with major commercial clients are directly appointed to high level government positions. Movements in both directions of the revolving door create harm for the integrity of public policy-making but they require different mechanisms to manage the cooling off periods.
Internationally, it is standard practice for there to be a “stand-down” (or “cooling off”) period for Ministers and their staff before they move into lobbying roles. New Zealand currently has no cooling off period at all. Examples of cooling off periods in other countries are:
- Australia: 18 months
- European Union: 18 months
- United States: 2 years
- United Kingdom: 2 years
- Taiwan: 3 years
- Canada: 5 years.
Cooling off periods are designed to discourage individuals from:
- making decisions while in office in order to curry favour with future employers.
- selling relevant state information, gained while in office, to lobbying clients.
Former government Ministers have access to a huge amount of confidential information that could be used to unfairly advantage industry clients. While in government, ministers are aware of the Government’s future plans and advice from officials. They have insight into the opinions, motivations and concerns of other ministers and have extensive knowledge of the policies within their own former portfolios.
A significant number of ministers and senior staff members have moved directly from government into lobbying roles in recent years, which has generated considerable media interest and public concern.
Managing the reverse flow through the revolving door (lobbyist to senior government role) comes under action point 3 below on managing commercial conflicts of interest
What we are asking for
Action point 1 in HCA’s action plan advocates for the creation of a Regulation of Lobbying Act. To slow the revolving door between government and industry lobbying roles, this act would include:
- A "cooling off" period of 1-3 years in which former ministers, MPs, political staffers and senior public servants cannot lobby government on issues where they had official dealings. This will ensure confidential government information and relationships aren't used for private benefit.
What these measures will achieve
Ministers often have access to sensitive information and decision-making processes that could benefit private interests. A cooling-off period ensures that former ministers have time to distance themselves from their government roles, reducing the risk of using insider knowledge for personal gain.
Allowing former ministers to immediately transition into lobbying roles can create the perception that they are exploiting their government connections for personal gain and commercial gain for their clients. A cooling-off period demonstrates a commitment to ethical behaviour and helps maintain public confidence in the integrity of government officials.
Why action is needed
Introducing a “cooling off” period would bring New Zealand into line with the standard practice followed by many other countries and the latest OECD recommendations that urge nations to, “design effective rules and procedures such as cooling-off periods, subject-matter limits, time limits, disclosure of post-term engagements by holders of at-risk positions, including abroad, and prohibiting any use of any insider information after they leave the public sector.”
- In Opposition, National’s deputy leader, Nicola Willis, expressed support for a one-year stand-down period for ministers, stating, “National thinks there should be a stand-down period of 12 months after any minister leaves government; they shouldn’t be hired by a lobbying firm the next day.”
- In an update on the Political Lobbying Project (instigated by the previous government following a number of scandals associated with lobbying), the Ministry of Justice cautioned that “movement between roles in government and lobbying agencies can result in misuse of privileged information and unfair access.”
- Even lobbyists recognise that the “revolving door” is an issue that needs to be addressed:
- A corporate affairs consultant wrote an opinion piece on the need to slow the revolving door for Stuff in 2022 stating, “The private sector has restraint of trade, gardening leave and the principle of continuous disclosure to prevent trading on inside information. But our democracy has nothing.’’
- The founder of a government relations firm told RNZ that she should not have been able to move from being a ministerial and policy adviser in Parliament directly to lobbying: “I think it’s entirely inappropriate. I shouldn’t have been able to do that.”
- Former Labour Minister Kris Fa’afoi set up a new lobbying firm, Dialogue 22 less than three months after stepping down from his ministerial roles in 2022. Fa’afoi is currently CE at Auckland based Management Consultancy Waitapu Group (the holding company of the now defunct Dialogue 22).
- Former Labour Minister Kiri Allen launched a consulting business KLA Ltd Consulting in October 2023 after resigning as Minister of Justice in July 2023.
- Former Labour Minister Clayton Cosgrove founded Cosgrove & Partners Ltd, a lobbying and consulting firm, immediately after leaving government in 2019
- David Cunliffe, former Leader of the Labour Party and Leader of the Opposition, resigned from Parliament in April 2017 and started working at a Government Consultancy firm – Stakeholder Strategies one month later.
- Former Labour Minister Iain Lees-Galloway who was dismissed from parliament in July 2020, founded Elmbank Engagement Partners, a private lobbying firm in July 2022.
- Former Labour Minister Stuart Nash, who held several senior ministerial portfolios, resigned following confidentiality breaches in March of 2023. Nash joined Robert Walters, a recruitment consulting agency, as a Commercial Director in October 2023.
- Former National Party Minister Amy Adams retired from politics in 2020, establishing her own consulting business ‘Amy Adams Consulting’ in 2021.
Former NZ First Minister Fletcher Tabuteau, who resigned from parliament in 2020, set up his own consulting firm – Hoporona Consulting in 2021, and is also listed as a director at Capital NZ, the same lobbying firm as former Labour Chief of Staff Neale Jones.
- Gordon-Jon Thompson (Former Press Secretary to PM Helen Clark, set up lobbying firm Thompson Lewis, then proceeded to be appointed Ardern’s Prime Minister’s interim chief of staff for about five months before returning back to Thompson Lewis). Thompson took a leave of absence from his lobbying firm in 2017 to work as chief of staff to Prime Minister Jacinda Ardern for four months.
- Andrew Kirton, who was previously Labour’s General Secretary, worked as a lobbyist for Anacta and resigned just one day before being announced as Chief of Staff for Prime Minister Chris Hipkins. At Anacta Kirton worked for alcohol companies lobbying against changes to a container return scheme that were subsequently axed under Hipkin’s leadership.
- Wayne Eagleson, former Chief of Staff to Prime Minister John Key, founded his own political consulting firm Wayne Eagleson Consulting Limited a mere 4 months after leaving parliament. Eagleson now is listed as a director at Thompson Lewis, Gordon-Jon Thompson’s consultancy.
- Tory Whanau (Former Chief of Staff for the Green Party – Resigned in 2021, Moved to the Lobbying firm Capital GR before becoming Wellington Mayor)
- Neale Jones, former Labour Chief of Staff, Political Director, and Communications Director, now owns 80% of Capital Government Relations, a lobbying firm based in Wellington.
- Mark Unsworth (Former private secretary to David Caygill for 2 years, then moved to the specialist lobbying firm Link Consultants, prior to starting his own lobbying firm – Saunders Unsworth Gov Relations Consultants)
- Barry Ebert, formerly Senior Ministerial Advisor to Phil Twyford, is the director and sole shareholder of the PR and lobbying firm Three Point Two Communications, roles he maintained throughout his two-year stint in the Beehive.
