Shamed former Cabinet minister Nick Smith is calling for an inquiry to clear his name after falling on his sword over letters he wrote as a minister to help a close friend.© 2012 Fairfax New Zealand Ltd
An emotional Dr Smith resigned yesterday after Prime Minister John Key called him back to Wellington to explain the emergence of a second letter – raising questions over his support for National Party activist and ACC claimant Bronwyn Pullar. The second letter emerged as Mr Key was under mounting pressure to sack Dr Smith and order an inquiry.
It revealed that two other MPs, backbencher Nikki Kaye and former Cabinet minister Pansy Wong, had also been asked to get involved in Ms Pullar's case. But they passed the matter on after declaring a conflict of interest – something Dr Smith failed to do when he signed ACC's formal response.
The saga that led to Dr Smith's downfall began when The Dominion Post revealed last week that ACC had mistakenly sent thousands of clients' files to Ms Pullar.
Senior National Party colleagues admitted they were "gutted" over Dr Smith's fall from grace, which leaves Mr Key with a big hole to fill in his Cabinet. But one source said Mr Key had "nowhere to go". "He saw that [second] letter this morning and thought `well, that's really crossed the line' ... it's been hard for all of us, to be honest."
There are now questions over why Mr Key did not act sooner after he backtracked on his earlier view that Dr Smith had not broken any Cabinet rules on handling conflicts of interest – suggesting instead that while Dr Smith's actions were in breach of the Cabinet manual, it was only there for guidance. Dr Smith had not acted illegally but did show poor judgment, which created a "perception of a conflict of interest", he said.
After abruptly cancelling his plans to attend a funeral in Nelson, Dr Smith boarded a flight to Wellington and penned his resignation letter en route, before telling Parliament he had made two errors of judgment over the letters relating to Ms Pullar's ACC claim while he was ACC minister. The first letter, on ministerial letterhead, explained Ms Pullar's state of health before the accident, prompting her compensation claim. The second letter emerged after a search of all Dr Smith's correspondence relating to Ms Pullar was ordered.
"I do want to put on the public record that I did not, in my view, interfere in any way in the judgment calls that ACC made about that particular person's claim but I do accept that the signing of those two letters is not up to the standard that this Parliament can rightly expect of its ministers," Dr Smith told the House.
He said there may still be an inquiry and he would welcome that. It would show that he received a tonne of emails from Ms Pullar and he did not respond to the vast bulk of those. "I effectively told my office this person is a friend and don't bother responding to her emails."
But Mr Key said he did not see any need for an inquiry beyond one being conducted by police and the Privacy Commissioner over Ms Pullar, who blew the whistle on a mass privacy breach by ACC after it inadvertently emailed details about more than 6000 claimants to her.
ACC has accused Ms Pullar of threatening to go public with the information unless it guaranteed her a benefit for two years – a version of events disputed by Ms Pullar and another close friend, former National Party president Michelle Boag.
Dr Smith has faced questions over his relationship with Ms Pullar after NZ First leader Winston Peters used parliamentary privilege to label it a "shabby little case involving blackmail, sex [and] a minister with a conflict of interest".
Dr Smith's senior colleagues are not ruling out a comeback to Cabinet and Mr Key left the door open yesterday, but Dr Smith said he would decide on his political future closer to the 2014 election. His departure will prompt a minor reshuffle, with Napier MP Chris Tremain tipped as the frontrunner to fill the vacant Cabinet slot.
Ms Pullar would not comment yesterday.
CONFLICT OF INTEREST AT CENTRE OF SAGA
Nick Smith's downfall originates from March 2010 when he failed to declare a conflict of interest when Bronwyn Pullar's ACC case crossed his desk.
Maungakiekie MP Sam Lotu-Iiga wrote to then associate ACC minister Pansy Wong about Ms Pullar's ACC claim on behalf of Auckland Central MP Nikki Kaye. Both Ms Kaye and Ms Wong declared a conflict of interest because they knew Ms Pullar personally. They had passed the matter on.
ACC wrote a formal response to Mr Lotu-Iiga and Dr Smith signed it, without acknowledging his own relationship with Ms Pullar.
"I am replying to your letter because Minister Wong has also declared a conflict of interest as she knows Ms Pullar personally," the letter said.
It said ACC had accepted cover for some of Ms Pullar's injuries and acknowledged she had requested a review of the decision.
In a letter written in December 2010, Dr Smith told Ms Pullar it was inappropriate and impossible for him to intervene in the matter on her behalf.
"I found the tone of your letter pretty over the top with your claims of corruption and rotten to the core etcetera," he said.
In March last year he wrote to Ms Pullar saying he had looked into concerns she raised about an ACC consent form. He reiterated that it would be inappropriate for him to interfere with her ACC case.
"I do hope you are able to resolve these issues and move on with your life."
The second contentious issue was the letter of recommendation Dr Smith wrote in July last year in support of Ms Pullar.
"I can confirm, however, that in my contacts with Bronwyn prior to the accident she was well and a dynamic, capable person who worked hard and achieved a lot," he said.
"I wish to put this on record to assist in any comparative assessment of Bronwyn's current health."
All four letters were written on Dr Smith's ministerial letterhead.
HOW THE STORY UNFOLDED
Tuesday, March 13: Dominion Post investigations editor Phil Kitchin reveals that private details of more than 9000 ACC claims – some featuring well-known people – have been emailed to a person who should not have received them. The privacy breach, described as one of the worst in New Zealand history, included personal information on nearly 250 clients from ACC's most secure unit, the sensitive claims unit.
Wednesday, March 14: ACC says it will telephone or mail an apology to 6748 clients whose privacy had been breached and deal with compensation claims case by case. The corporation said a staff member sent a spreadsheet containing the names and nature of at least 9000 claims, including some by those who said they had been the victims of sexual abuse and other violent crime.
Friday, March 16: The whistleblower who contacted The Dominion Post is referred to police over claims she threatened to go public about being mistakenly sent the confidential details, unless ACC promised to pay her a benefit for two years. In a report to ACC Minister Judith Collins, ACC said the woman tried to negotiate a guaranteed benefit payment: "She made threats that, if her demands were not met, she would not return the information and she would inform the media of the alleged privacy issue."
Sunday, March 18: A Sunday newspaper names the whistleblower as Auckland businesswoman and former National Party activist Bronwyn Pullar.
Monday, March 20: Ms Pullar said she had never made threats or demands about the return of information in her dealings with ACC. "I did not threaten ACC that I would inform the media of the alleged privacy issue, I did not threaten ACC to get my own way in any way."
Tuesday, March 20: Environment Minister Nick Smith apologises to Prime Minister John Key after admitting he wrote a reference for Ms Pullar for her to use in her medical assessment for a claim lodged with ACC. The letter, written in July 2011 when Mr Smith was ACC minister, was written on ministerial letterhead.
http://www.stuff.co.nz/national/politics/6615758/Ex-Minister-Nick-Smith-fights-to-clear-name
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