John Key has had some terribly bad luck recently.
First Fran O’Sullivan spilt the beans and told us that Key had this super plan to make New Zealand a bolt hole for the 1%. The article was posted two weeks ago. I mentioned it in this post.
I was struck by how tone deaf Key’s comments were. Wanting New Zealand to be swamped by the uber wealthy and not taxing multi national corporates because there may be a business case are the sorts of things that really clash with the idea that New Zealand should be an egalitarian multicultural society that respects its environment where everyone pulls their weight.
And it clashes with the carefully constructed image of Key being a state house dwelling son of solo mum immigrant. Poor boy does good remembers where they came from. Wanting to bestow privilege on the already wealthy clashes with this.
For some reason this post took off. There were an average number of comments, 91 at the time of typing this. But the Facebook references were huge and there have been a huge number of page views.
You can bet that if there is one thing that Kiwis will be really upset about it is making New Zealand some sort of haven for rich people, especially when their wealth may have been gained in less than morally acceptable circumstances.
Then the Panama Papers hit. Suddenly there was proof, if this was required, that rich people throughout the world had used tax havens to avoid paying their fair share of tax. Great if you want to live the sort of lifestyle that pretty well everyone in the world can only dream of. But terrible if you want to make sure that kids living in your country do not have their lives blighted because they are hungry or they live in cold overcrowded homes or their schools because of funding issues cannot deliver the quality of education that they deserve.
And New Zealand has clearly become an investor’s dream. There may be semantic arguments about its exact status but clearly it has become a haven for people trying to avoid paying tax in their home nation.
Key’s second piece of bad luck was that just over a month ago he finalised his pecuniary interests return. It contained a simple line that referred to “Antipodes Trust Group Limited – short-term deposit”.
This company proclaims itself to be “a specialist provider of trustee and associated services for foreign trusts using New Zealand as their jurisdiction of choice”. Its executive director and main point of contact is Ken Whitney who has been John Key’s solicitor for a while. He is also one of the directors of Whitechapel Limited which is I understand the corporate trustee of Aldgate Trust which is John Key’s blind trust. The evidence of this is that shareholding in the Earl of Auckland Ltd, Devils Creek Ltd (the Winery) and Dairy Investment Fund Ltd were transferred from John and Bronagh and Whitney to Whitechapel Limited in 2009. Here is the Earl of Auckland Ltd shareholding change.
The Earl of Auckland shares are still owned by Whitechapel. The Dairy Investment Fund shares were transferred in December 2008 to Whitechapel and in July 2010 to FNZ Custodians Limited.
The Devils Creek (now called High-water Vineyard) shares are the most interesting.
Even though it appears that Whitechapel no longer has any interest in the winery Key has made a big deal of handing out JK branded wine and has done so for a while. It appears that Key’s trust no longer has any interest in the company but he still hands out JK branded Highwater wine. Perhaps he should be asked about the details of the distribution deal.
The subtleties of his relationship with Antipodes Trust Group Limited will need an explanation. He has explained that the deposit was to cover legal costs for his trusts.
Having a blind trust is one thing but the problem with a blind trust is that you are not meant to know what is going on. Having as a director of the trustee someone who heads a business which proclaims itself to be a specialist provider of trustee and associated services for foreign trusts using New Zealand as their jurisdiction of choice really makes you wonder if some of Aldgate/Whitechapel’s funds have been invested in foreign trusts.
As a minimum Key should release his tax returns. Andrew Little has. David Cameron and George Osborne have.
And rather than hide behind a blind trust our leaders ought to declare what they own. And if they want to be leaders they should cash up their investments so that there is no possibility that the decisions they make may improve their material worth.
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