“Whoever is careless with the truth in small matters cannot be trusted with important matters”.
Corruption – It is one of the world’s most baffling social problems – the dynamic relationship between state power, corruption, corporate power and organized crime and it is alive and well in Christchurch. Many of the decisions, actions and inactions arguably amount to organizational deviance which, when combined with human rights violations, amounts to state crime, systemic corruption, state collusion, corporate crime, and negligence as well as post-disaster cover-ups.
If you’re saying to yourself – those questionable wheelings and dealings in Christchurch in the aftermath of the earthquakes is not corruption, then you are severely mistaken. The corruption can be traced to systematic, pervasive government corruption, hand-in-glove with the global abuse of trust by ‘professionals’ who have conflicts of interest, together with corporate dishonesty by insurers and financiers.
Perhaps you think corruption is not really a crime, or merely an economic crime – yet it is not a victimless crime – it involves the looting of tax payers’ money and we are witnessing a rising amount of corporate and professional corruption in the private sector in Christchurch today. This systematic dishonesty is undermining the recovery and the efficiency of what we get for our dollar. What we need is a system to protect Cantabrians from the ravages of the dishonesty we are experiencing. If you think that corruption is only a small problem and that it has been with us forever and that there is little we can do about it – then you believe in a very dangerous myth which is leading us down a very dark road of which thousands of Cantabrian householders have bitter experience.
A civil society must have a transparent financial governance, which entails the need for more honesty and competence from our civil leaders. It requires corporate and professional social responsibility – and must provide us all with the tremendous opportunity to create a better world. It is actually We, the people, who have the ultimate influence over our elected officials, although the people rarely stop to consider this, but it is my belief that they will soon do so. Civil society needs to rise to the occasion. We have to find an effective remedy – collective action is required.
Yes, insurance IS one of mankind’s greatest inventions and when it works as intended it provides a level of protection to individuals which was at one time, second to none, but when it does not function honestly, wide scale misery is the result as it has been in Canterbury.
True, the power of the insurance industry to remedy disaster is enormous but it is also true that it has no inherent moral character. It is not owned by the people, nor does it work for the best outcomes for the people. What is critical to citizens post disaster, when they are at their most vulnerable, is the importance they attach to that aspect of character called honesty. The current political system is very clearly facilitating the greed of the big insurance corporates and big business generally. This Parliament and this Government have done little or nothing to call them to account – leading to a failure to protect our ordinary citizens against profit-hungry, foreign-owned corporates – leading to the further enrichment of a few of the wealthy at the general expense of New Zealand society. Any sense of social justice would have led an honest government to prohibit these activities. It is also true that it is a fact that the legal system is in place to enforce certain aspects of “good behaviour”, but most good behaviour is voluntary and in any case, access to the civil legal system has been permitted to attain a status which is out of reach of all but the wealthy.
Let us not forget that it is politics that has shaped ‘the market’, to which Mr Brownlee is so apt to refer, and it has shaped the ways in which corporates now have great advantage at the expense of the citizen. Any well-functioning economic system must have rules and regulations; it must operate within a fair and reasonable legal framework. We require behaviour by regulators that prevents political/corporate pressures from dictating political and social policy. The legal framework for the protection of policyholders in this country is all but absent. Making myopic decisions based on the short-run political considerations by the party in power in respect of insurance behaviour and regulation, is not wise policymaking. Public policy relating to insurance needs to be built on principles, not expediency. For example, the decision to reduce EQC’s liability by creating the MBIE ‘minimum guidelines’ for repair, has saddled many unsuspecting Christchurch homeowners with future liabilities for many years to come. Only a structure based on well-designed principle will lead to better outcomes for those at risk and add to an improvement in social wellbeing. Such principles would require that the insurance industry and EQC not take advantage of short-term profit opportunities such as altering premiums dramatically (without any discussion with its policyholders), abandon some of its customers and/ or leave the market entirely (e.g. Ansvar).
I argue that it is the asymmetry in relations between the people and those in power which has led to failing governance. We need the capacity to reintroduce the integrity of politics into our small arena. The impact of corruption in governance is insidious and on-going and until it is stopped the future for Christchurch and New Zealand looks bleak.
It is a global fact that the worst projects are usually realized first in post disaster situations and developed in the most unlikely sets of circumstances – projects that produce no economic benefits – projects such as the anchor projects proposed for Christchurch. Rather than producing benefits for the community they do damage instead, they bring indebtedness to the community at the expense of public amenities and parks and they bring division in the society. Yet together, by consortia of government, banks and insurers, driven by unholy alliances between powerful elites and suppliers, who are the actors in the global marketplace, these projects get the go ahead and they are invariably driven by large-scale corruption. Systematic corruption is perverting our economy and ultimately our recovery.
As many of you will know, I have followed the history of the Christchurch scenario very closely since the outset of the so-called ‘recovery’ and one of the most disturbing aspects I have found in the post quake environment in Christchurch, throughout the insurance process, is the level of dishonesty and self-serving – not only from the insurance industry but the industries that support it – such as the professional engineering firms, the quantity surveyors, loss adjustors, builders and lawyers etc. I have been utterly disgusted at the levels people are prepared to sink to for a ‘quick buck’. For many of these ‘insurance industry supporting roles’, integrity and trust left the building on the day the September 4th earthquake happened and has rarely been seen to surface since.
Let us not forget that a political system allocates – by action as well as inaction in a variety of channels – one very important value: life safety. Despite their apparently mundane nature, decisions on building codes are at the heart of life safety allocations, for such decisions determine, at least in probabilistic terms, who dies in an eventual further disaster: where, when and how. Yet we are constantly seeing the standards allocated to life safety dropping. ( see http://www.stuff.co.nz/the-press/news/christchurch-earthquake-2011/9261735/Appeal-on-building-strengthening-quashed).
Building code violations are part of a well entrenched political process of give and take between the same major key players i.e. professional groups, government and industry. But it is the local population who suffer. There is regrettably little evidence of a professional culture within these affiliated industries or their governing bodies to ensure safe practice.
Conflicts of interest seem to be prevalent everywhere – such as when an individual or organization is involved in multiple interests, one of which could possibly corrupt the motivation for an act in the other. Most professions have clear statements around what is and isn’t a conflict of interest and the professionals flouting the standards are fully aware. If an engineer working for a private insurer only scopes a damaged building on the basis of a repair because that’s what he’s told to do – he has at that moment, lost all professional integrity – yet all around the city there are engineers doing just that. Some are working for insurers and clients at the same time!!
When trust exists in an organization or in a relationship, almost everything else is easier and more comfortable to achieve. Immediately you are left feeling able to rely on the person working for/with you, cooperating becomes easier as does taking thoughtful risks, and believable communication becomes a reality. Yet the insurance industry and the global corporate sector, in its relationship with many of our citizens, and modest enterprises, has been and is, committing a form of grand larceny.
The people need government which is prepared to sit around the table and talk about the means to eliminate the corruption and dishonesty taking place, rather than to promulgate it – and of course, the silent population out there is aware of it. My question is – why isn’t the population demanding more of its public servants? Will we put up with this until we are all financially ruined?
In addition to public lands being made available for privatization, various enterprising firms and
individuals, relying on populist government practice, are likely to be able to build on undeveloped public land before it becomes available for sale. Restrictive rules and regulations are repealed to encourage ‘entrepreneurs’. The commencement of virgin construction companies, relying on the help of friends in local politics to win contracts, companies that will simply disappear after the work dries up, leaving the homeowner with nowhere to turn when the shoddy workmanship goes bad (just as it did with the leaky home scenario). All of these things constitute corruption.
We are seeing building code violations oriented around ‘trade-offs’ between the ‘core values’ of the major players such as professional groups, government and industry at the expense of the homeowner. This incestuousness and the corruption which it nurtures institutionalizes and legitimizes the trade-offs. The advantage for the state is twofold: the incestuousness creates the climate which allows local corruption to flourish; corruption, in turn, ensures the provision of cheap mass housing with substantial profits. Corruption is thus a cheap and devolved means by which our Government seeks to ‘address’ the social housing crisis. Yet what we see is the continued prevalence of examples such as this:
“Council Manager, Resource Consents, John Higgins said the Council welcomed the changes. “The amendments mean the majority of repairs for lower level land damage, including repairs for undulating land, localised ponding, lateral spreading, land cracking, settlement or new groundwater springs will become permitted activities. While some of these repairs will require geotechnical engineer oversight and approval, no resource consent will be required.” (See http://www.ccc.govt.nz/thecouncil/newsmedia/mediareleases/2013/201310104.aspx) and http://www.radionz.co.nz/news/canterbury-earthquake/224292/minister-makes-fixing-quake-damaged-land-easier). The civil engineering practice of deep bore hole investigations would reveal to contractors, consultant engineers and authorities the dangers inherent in the soil conditions. Yet what we are seeing is a purposeful intention not to carry out these tests or only test shallow bores or simply not at all or to an inappropriate standard. Why, because it saves the Earthquake Commission or the private insurer money. The Government (central and local) know that if they wash their hands of as many consents as possible, then they are not liable for the problems that will surface down the track. This is corruption.
The body that creates the codes and building standards is the Ministry of Building, Innovation and Employment. However, the implementation of these codes and regulations is not the
responsibility of this Ministry but of the local governments, and the local governments are not responsible to the Ministry … so there is a dichotomy between who’s responsible and who makes the
rules. That is one of the primary reasons that they are enforced in a confused and ineffective way. In addition there is no mechanism for the inclusion of public participation, yet on the ground in Christchurch there are many concerned citizens lamenting what is taking place. No doubt local interest groups (private developers and contractors) have a stranglehold on the urban planning process, including decisions on what land will be developed, when and how, and on raising urban land rents. And while the Government has sent someone down from ‘head office’ to ‘reconfigure’ the consenting process for repair and construction of homes in Canterbury, an intrinsic component of government ties local political networks to the national government framework and its own agenda. In this way local processes can be manoeuvred from ‘above’.
It is a community’s political system that decides authoritatively through the public policy process who will get how much life safety and who will pay for it. When the next earthquake disaster occurs in Christchurch we will be able to categorically link the undisputed lack of adequate engineering, lack of industry inspection and quality assurance, cheaply and ineffectively repaired buildings to state laxity and the deaths that arise.
Corruption is alive and well in Christchurch! What are you going to do about it??