MP TAMIHERE CLEARED IN FIRST OF TWO

C O N F I D E N T I A L SECTION 01 OF 02 WELLINGTON 000058

SIPDIS

DEPT FOR EAP/ANP

E.O. 12958: DECL: 01/20/2015
TAGS: PGOV PREL PHUM NZ
SUBJECT: MP TAMIHERE CLEARED IN FIRST OF TWO
INVESTIGATIONS; HITS THE COMEBACK TRAIL

REF: 04 WELLINGTON 909

Classified By: ACTING DCM KATHERINE B. HADDA, FOR REASONS 1.4(B,D)


1. (U) Summary. Beleaguered Labour MP John Tamihere has
begun his political rehabilitation, offering a "state of the
nation" speech January 19 that attacked the "separatist"
Maori party, defended Labour's economic policies, and
eschewed the left-right division of unions and business
leaders in favor of pragmatic solutions. Following a
two-month investigation, a report released December 21
cleared Tamihere of charges related to tax liabilities on a
"handshake" payment provided by his previous employer, the
Waipareira Trust. However, an investigation by the Serious
Fraud Office (SFO) on related issues is outstanding, and it
is unlikely that Tamihere will be returned to Cabinet in the
near future. End summary.

"I Am A Maori and They Have Stolen My Name"
--------------


2. (U) This was Tamihere's first public speech since
resigning as Minister in November. Playing on his appeal to
more right-wing Labour voters, Tamihere decried the old
ideologies of left and right, extolling unions and business
leaders to focus on working concepts instead of archaic
stereotypes of the "boss as bad" and "unions as lazy
lefties." While the bulk of the speech focused on
election-year themes - immigration, economic development and
the on-going Constitutional Inquiry - Tamihere spoke most
sharply on race issues. He attacked the newly formed Maori
Party as "tribalists" who "advocate grievance and
victimhood." He also expressed frustration that the educated
academics who run the Party have allied with the new
"checkbook" elite -- Maori made rich by Governmental Treaty
of Waitangi settlements. "I am a Maori and they have stolen
my name," Tamihere said. (Note: Popular Maori Party
co-leader Dr Pita Sharples was chosen to stand against
Tamihere on October 25 (reftel) and Tamihere's Tamaki
Makaurau seat is seen as vulnerable in the upcoming
election.)

Still Out in the Cold
--------------


3. (U) Following a two-month investigation, a report released
December 21 cleared Tamihere of charges related to tax
liabilities on a "handshake" payment provided by his previous
employer, the Waipareira Trust, finding that tax liability
rested with the Trust. But the report found that Tamihere
did not declare his receipt of income on the Ministerial
register, and has referred this issue to the Commissioner for
Inland Revenue. Tamihere's political future remains
uncertain, as an investigation by the Serious Fraud Office
(SFO) into eight allegedly false invoices signed by Tamihere
is still underway. If the SFO finds Tamihere innocent, the
way would be clear for him to resume his role of strong
advocate for Maori issues. This could be helpful in the
run-up to the 2005 election, in which all seven
Maori-designated Parliament seats will be hotly contested.


4. (U) PM Helen Clark sent Tamihere a strong signal with her
Cabinet reshuffle on December 20, when she reassigned his
portfolios on a permanent basis. All is not lost, however,
and following the first report's release Clark publicly
stated that Tamihere has "a strong future", hinting that he
can expect a portfolio after the 2005 general election.
Clark offered a surprisingly high level of solidarity with
Tamihere, noting that Tamihere has been the most-investigated
MP, and hinting that this may be the result that the
Opposition fears his strong appeal to Maori and non-Maori
Labour voters.

Confession Is Good For the Soul
--------------


5. (C) Comment: Throughout the initial scandal and the
subsequent inquiry, Prime Minister Clark consistently applied
the same rigorous moral standard to Tamihere that she has to
other Ministers who have violated her cardinal rule of "No
scandal." But although she sent Tamihere to the backbenches
to serve his time, Clark has kept dangling the possibility of
his future rehabilitation into the Cabinet. At the same
time, demonstrating the political mettle that has kept her
firmly in control of the Labour Party for the past ten years,
Clark has maintained a sufficient distance from Tamihere that
should he be found to have committed an impropriety, neither
she nor the Party will suffer.


6. (C) Tamihere's speech, with its folksy comments softening
Union "ownership" of the Labour party and controversial
comments on Maori separatism, demonstrates clearly his
ability to attract voters who are generally supportive of
Labour but put off by the party's left-wing,
politically-correct agenda. For this reason, Labour Party
leaders are no doubt keeping their fingers crossed that
Tamihere's political rehabilitation will hold throughout the
upcoming election campaign.
Swindells