Greens say govt must tender master banking contract with Westpac after Ministers reveal corporate hospitality accepted from the bank

By Alex Tarrant

The Green Party is calling on the government to put out a competitive tender for its master banking contract after ministers revealed they had accepted corporate hospitality from Westpac in the last year at its Westpac stadium box and at the exclusive White House restaurant in Wellington.

The government's master banking contract is thought to be the single biggest banking contract in New Zealand. Last year the Green Party asked Finance Minister Bill English why it had not been put out for a full competitive tender since David Lange was Prime Minister, with the pressure leading to English saying the government would commit to a future procurement process for the contract, although it was unclear this meant a full tender.

"Given the complexity of banking arrangements for key departments, we are currently consulting with these departments on the timing, nature and scope for this process," English said in December.

The master banking contract has been Westpac's for 21 years without being tendered. It covers all government departments, but not Crown entities or State Owned Enterprises.

In December, a spokesman for English told interest.co.nz the contract had not been re-tendered to date because the costs of doing so outweighed the expected benefits, "given the complexity of arrangements with departments and the price reductions negotiated under the existing contract".

Govt needs to come clean

On Wednesday morning the Greens released a full list of answers to the question of whether Ministers or their staff had accepted corporate hospitality from Wesptac over the last year.

"A series of Green Party written questions has revealed a widespread pattern of treating government ministers and their staff. Nine ministers were found to have accepted corporate hospitality from Westpac Bank in the last year, including box seats at the Rugby 7s, dinner at the White House restaurant [where mains cost NZ$50], and tickets to rock concerts [Gerry Brownlee attended Bon Jovi]. Thirteen ministers had staff who had accepted similar hospitality from Westpac," Green Party co-leader Russel Norman said. See the White House menu and costs here.

"The Government needs to reconsider the way they regularly accept gifts from large corporates like Westpac. These gifts aren’t neutral; they buy access to decision makers in an unfair way,” Norman said.

“Ministers accepting personal gifts from Westpac creates a potential conflict of interest as the Government is actively considering retendering part, if not all, of the banking master contract. Most New Zealanders can’t afford this kind of access, and hence it corrodes the public’s belief that we are all equal in the eyes of the Government," he said.

“The fact that so many ministers had staff who also accepted Westpac’s largesse is disquieting, given the central role of ministerial staff in influencing the decisions of their busy Ministers. There’s an important difference between doing business in a friendly way and using money to buy access to power.”

One way to allay concerns over undue influence in Westpac’s case would be to have a competitive tender for the master banking contract, Norman said.

"Westpac’s 20-year monopoly needs to be opened to competitive forces to ensure the taxpayer is getting the best value for money from the Government’s banker," he said.

“Another way to avoid all suspicion is for the Cabinet Manual to be more explicit about accepting gifts. Ministers and their staff need to accept that they must work to a higher ethical standard when it comes to corporate treating. We need to keep politics honest.”

'Why the fuss?'

Prime Minister John Key told reporters on Wednesday afternoon that the Green Party did not have any legitimate concerns, and the contract was going to be tendered.

"The Government has opened the contract to a competitive tender for the first time in 20 years," Key said.

"That process will go through normal procedures...Treasury will make the final decisions," he said.

A spokesman for Finance Minister Bill English noted his comments made in December that the government would open the contract to a competitive process.

"Officials have already begun scoping work on that process, and this will be the first time in over 20 years the Government's master banking contract has been opened to a competitive process," the spokesman said.

The list (from the Green Party website)

Transcript of Westpac Questions for Written Answer

Green Party Research Unit, May 2011

Question 1: Has he/she, in his/her capacity as Minister of _______, attended any events in the last 12 months where Westpac New Zealand Ltd provided him/her or any of his/her staff with a corporate box?

Rt Hon John Key: No, I have not attended any events hosted by Westpac in a corporate box. It is my understanding that a number of my staff have, on occasion, accepted invitations to events hosted by Westpac in a corporate box. However these are not recorded centrally.

Hon Bill English: I did call in to the Westpac box at the 7s in February…In my capacity as Minister for Infrastructure…it is my understanding that a number of my staff have, on occasion, accepted invitations to events hosted by Westpac in a corporate box.

Hon Gerry Brownlee: Yes. It is my understanding that some of my staff have, on occasion, accepted invitations to events hosted by Westpac in a corporate box. However these are not recorded centrally.

Hon Simon Power: Yes, I attended the 2010 Wellington Rugby 7s Tournament, hosted by Westpac New Zealand Ltd in a corporate box at Westpac Stadium. In addition, a member of my staff attended a soccer match in a corporate box at Westpac Stadium…, in my capacity as Minister of Commerce, I was invited to attend the 2011 Wellington Sevens Tournament, hosted by Westpac in their corporate box on 5 February 2011.

Hon Tony Ryall: Yes. It is also my understanding that staff have on occasion accepted invites to events hosted by Westpac in a corporate box, but these are not recorded centrally.

Hon Steven Joyce: No, I have not attended a Westpac corporate box in the last 12 months. It is my understanding that a number of my staff have, on occasion, accepted invitations to events hosted by Westpac in a corporate box. However these are not recorded centrally.

Hon Tim Groser: I have not attended any Westpac corporate box events. I understand that some of my staff have on occasion accepted invitations to corporate box events hosted by Westpac. However, these are not recorded centrally"

Hon Dr Jonathan Coleman: I have not attended any events. However, it is my understanding that on occasion my staff have accepted invitations to events hosted by Westpac in a corporate box. These are not recorded centrally.

Hon Peter Dunne: It is my understanding that a member of my staff has, on occasion, accepted invitations to events hosted by Westpac New Zealand Ltd in a corporate box. However, these are not recorded centrally.

Hon Anne Tolley: I attended a corporate box on the invitation of Westpac New Zealand on 6 February 2011. I have not had any formal meetings with Westpac representatives, but I have met with representatives of Westpac at a number of social events, including in my own electorate. It is my understanding that some of my staff have, on occassion [sic], accepted invitations to events hosted by Westpac in a corporate box. However these are not recorded centrally.

Dr Wayne Mapp: Yes. On 19 February 2011 I attended the Blues versus Crusaders Super 15 rugby game at Eden Park.

Hon Rodney Hide: No. However, it is my understanding that a number of my staff have, on occasion, accepted invitations to events hosted by Westpac in a corporate box. However, these are not recorded centrally.

Hon Phil Heatley: As far as my diary reflects, and I can recall, I have not been hosted by Westpac in a Corporate Box in the last 12 months. Members of my staff may have, on occasion, accepted invitations to events hosted by Westpac. However these are not recorded centrally.

Hon Kate Wilkinson: I have not attended any such events. It is my understanding that a number of my staff have, on occasion, accepted invitations to events hosted by Westpac in a corporate box. However these are not recorded centrally.

Hon Maurice Williamson: Yes, but not in any particular portfolio capacity.

Hon Judith Collins: I have attended one event as a guest in a Westpac corporate box in the last 12 months. No staff members have attended.

Hon David Carter: I have not attended any events in the last 12 months where Westpac have provided me with a corporate box. It is my understanding that a number of my staff have, on occasion, accepted invitations to events hosted by Westpac in a corporate box. 

Hon Paula Bennett: I can advise the Member that in my capacity as Minister for Social Development and Employment and Minister of Youth Affairs, in the last 12 months I have attended a music concert as a guest of Westpac on the 4 December 2010.

Question 2: Has he/she, in his/her capacity as Minister of ________, met with any representatives of Westpac New Zealand Ltd outside of Parliament in the last 12 months; if so, who, what is their position within the bank, and when and where did they meet?

Rt Hon John Key: I opened a new Westpac Branch in Huapai on 4 December 2009. The Chief Executive Officer George Frazis and other Westpac staff attended that opening.

Hon Bill English: In my role as Minister of Finance I attend and host a large number of public and corporate meetings and events, to both present speeches and to hear from New Zealanders about their views. Therefore, I will have met representatives of Westpac at a number of these such occasions.

Hon Gerry Brownlee: Yes. On 4 December I attended the Bon Jovi concert in Wellington in a Westpac corporate box. George Frazis, the CEO, and a range of Westpac employees were present. Why did I attend? Because, "It's my Life".

Hon Simon Power: Yes, I have attended meetings on the following dates: 1 March, 2010, attended dinner with the Westpac Board at the Westin Hotel, Auckland. 23 November, 2010, attended dinner with the Westpac Board at The White House, Wellington…in my capacity as Minister of Commerce, the member will understand that I often attend a significant number of meetings where representatives of Westpac New Zealand are present, along with other industry representatives. It would be difficult to detail all of these meetings, since it may not have been immediately obvious whether Westpac was represented. Having said this, there are a number of meetings where I am aware that representatives of Westpac NZ have been in attendance, amongst others: • Prime Minister's post-Budget speech, attended by the CEO of Westpac NZ, on 21 May 2010 in Auckland • Lunch with Russell McVeagh and other executives, attended by the General Counsel for Westpac, on 29 July 2010 in Auckland • Meeting with the Financial Markets Authority Establishment Board, of which the General Counsel for Westpac was a member, on 5 August 2010 in Auckland • Corporate Affairs and Regulatory Forum, attended by Head of Government Relations for Westpac, on 9 September 2010 in Auckland • Speech at Insurance and Savings Ombudsman Annual Meeting, attended by the Wealth Advisor for Westpac, on 9 September 2010 in Auckland • Speech at Franchise Association of New Zealand's Franchise Awards, attended by a senior representative of Westpac, on 13 November 2011 in Auckland • Discussion with stakeholders regarding the review of securities law, which included the General Counsel for Westpac, on 17 March 2011 in Auckland. • Australia/ New Zealand Leadership Forum, attended by CEO of Westpac NZ, on 28 March 2011 in Auckland In addition, on 21 September 2010 I met with the Corporate Counsel for Westpac Banking Corporation in Sydney, Australia. As noted in my response to question for written answer 37069 (2011), I also attended dinner with the Westpac Board in Wellington on 23 November 2010.

Hon Tony Ryall: Yes. I have attended functions in Auckland and Wellington with the Board's Chair, Board Members and Executives.

Hon Steven Joyce: I attended one social function in Wellington on 23 November 2010 with a number of senior Westpac representatives. It is possible that representatives of Westpac have attended a speech or event I have also attended at another time, but I do not keep a record of every attendee of every event I have been to.

Hon Peter Dunne: In my capacity as Minister of Revenue, I had dinner with the New Zealand Board and Chief Executive Officer of Westpac New Zealand Ltd on 23 November 2010.

Hon Phil Heatley: On Tuesday 5 October 2010 in Sydney, I met with Westpac, as well as other organisations involved in the Bonnyrigg PPP consortium, as part of my visit to investigate Australia's approach to social housing.

Hon Judith Collins: 30 July 2010: Guest at Westpac Women in Business luncheon. Dickson Room, Canterbury Centre, Christchurch. 19 February 2011: Invited by Westpac to be Guest speaker, International Women's Day breakfast, Takutai Square, Auckland.

Hon David Carter: On Wednesday 16 June 2010 I visited the Westpac tent at Mystery Creek Fieldays to hear Brendan O'Donovan, Chief Economist, speak; and on Thursday 9 September 2010 I attended a Federated Farmers information meeting at Darfield High School where Ian Blair, General Manager Business Banking, spoke. I may have met other Westpac New Zealand employees causally on other occasions but have no record of this.

Hon Paula Bennett: I can advise the Member that in my capacity as Minister for Social Development and Employment and Minister of Youth Affairs, in the last 12 months…I have met with John Johnston on 2 March 2010 for lunch at the Backbenchers Bar, on 25 November 2010 in my office and I sat next to him at a event on 7 April 2011 of which I was the guest speaker. I also met with a number of Managers from Westpac New Zealand Ltd on 6 May 2011 and we talked about employment opportunities. This is also my response to written parliamentary question 3253 (2011).