16 July 2002

INTRODUCTION

Establishment of review

1 The Minister of Defence and the Chief of Defence Force have each requested, under section 11(4) of the State Sector Act 1988, that the State Services Commissioner "review the performance of the Defence Force in relation to expected standards of behaviour, and in particular the leaking and inappropriate use of information by Defence Force personnel."

2 To meet that request the State Services Commissioner determined to carry out an inquiry defined in the terms of reference set out in Appendix 1 to this report. The Commissioner appointed us, Douglas White QC and Graham Ansell, under s 25(2) of the State Sector Act 1988, as a Review Team to conduct this inquiry.

3 For the purpose of summoning witnesses and receiving evidence, s 25(1) of the State Sector Act gives the State Services Commissioner the powers of a Commission of Inquiry under the Commissions of Inquiry Act 1908. While those powers attached to our inquiry, we were not a formal Commission of Inquiry as such nor were we expected to hold formal, public hearings with the involvement of parties, and witnesses being cross-examined by opposing counsel.

Context of the review, and relationship to other reviews

4 The Government's Defence Policy Framework released in June 2000 foreshadowed a "review of accountabilities and structural arrangements between the Ministry of Defence and the New Zealand Defence Force".

5 On 10 September 2001 the Minister of Defence announced a review of the accountabilities and structural arrangements between the Ministry of Defence, the New Zealand Defence Force, and the three Services. The Minister of Defence expects the reviewer to provide an interim report to him by the end of 2001.

6 In addition to its concerns about accountabilities and structural arrangements the Government has expressed increasing disquiet about the handling of Defence documents and information, including 'leaks' to members of the Parliamentary Opposition. The Minister has announced two further reviews as a consequence. The first is the review that is the subject of this report, about the performance of the Defence Force in relation to expected standards of behaviour, and in particular the leaking and inappropriate use of information by Defence Force personnel. This review was originally required to be completed by the end of November 2001, so that the results would be available to the first (accountabilities and structural arrangements) review as soon as possible, but the reporting time was extended when we were requested to direct our attention to the more urgent matter of the allegations by Mr Ron Mark MP about misuse of his Army files. On completion of our report on that matter on 13 December 2001 we resumed our work on this report.

7 The third review, which is intended to address specific concerns about a letter written by an Army officer in March 1997, and an e-mail circulated by Navy staff in March 2001, is being conducted under the authority of the Judge Advocate General. The Judge Advocate General was originally expected to report by mid-December 2001, but we understand that it is now unlikely that he will do so before the end of January 2002.

8 Our terms of reference note the possibility of overlap between our review and the review being carried out by the Judge Advocate General, and requires appropriate cooperation and consultation between the two.

Nature of Government's concerns

9 Before beginning our inquiry, we were briefed by the Minister of Defence and the Chief of Defence Force on the nature of the concerns which had led to their requesting the State Services Commissioner to initiate the investigation. This was done both orally and by the submission of documents. Their observations covered two broad areas:

9.1 Unauthorised disclosure of official information

9.2 The Minister supplied us with a list of 44 occasions on which unauthorised disclosures may have been made. These fell into several different categories, and were of varying degrees of seriousness, though all had caused embarrassment. In some cases, Defence personnel had spoken openly to media representatives or written letters to newspaper editors about policy issues. In other cases, information had been published by the media without attribution, or at least with no more than a general reference to Service sources. There were a number of instances in which information had apparently been passed, without authority, to Opposition Members of Parliament as background briefing or in the form of copies of official documents. On some occasions, requests for documentation from the media or from Opposition MPs directed under the Official Information Act 1982 or as Parliamentary Questions to the Minister, appeared to have been prompted by sources within the Services. The report from the Chief of Defence Force covered a number of these cases, and some others; and a further list of apparent breaches was later supplied to us by the Chief of the General Staff. Both officers gave us details of investigations already made, where they had been initiated. We received from both copies of instructions they had issued with the aim of discouraging practices which they held to be unacceptable.

9.3 Standards of Defence Force behaviour

9.4 It was made plain to us that the Government was equally concerned to secure an independent judgement on the standards of behaviour within the Defence Force which had allowed and might have encouraged the spate of unauthorised disclosures. We were asked to endeavour to establish whether within the Force there was a full understanding of the relationship which should properly exist between members of the Force and the Government of the day, and of the need to avoid acting in a way that might suggest disloyalty to Government policies. Reports had reached Ministers and senior officials outside the Defence Force that some members of the Armed Forces believed they had a higher loyalty - to the Queen, through the Governor-General, who is Commander in Chief - which might cause them to work actively against Government policies which seemed to them detrimental to New Zealand defence interests. Essentially, Ministers wished to know whether there had been a breach in the convention of political neutrality within the Defence Force, and if so, what steps the Service Chiefs had taken to remind their subordinates of their obligations and, where necessary, effect a change in attitude.

Our approach and methods

10 At the outset of our review we considered what might be the most appropriate means of making the assessment and answering the questions raised in our terms of reference. We noted that we had not been asked to conduct a formal inquiry into the sources of the unauthorised disclosure of information which had led to our appointment. We were not required to make any findings which might affect the reputation of any identified individual and which might have justified adopting a different approach. We decided that, while under s 25 of the State Sector Act 1988 we had the same powers to summon witnesses and receive evidence as a Commission of Inquiry, the nature of our terms of reference and the need to report expeditiously meant that it would be appropriate and preferable to conduct our review through a series of interviews with persons able to assist us rather than by way of a formal public inquiry. We anticipated that those persons whom we interviewed would be likely to be more forthcoming if we adopted this approach.

11 Statements by the Minister of Defence gave public notice of our review. We believed that anyone who might wish to make a submission to us would have been aware that there was an opportunity to do so. The Minister of Defence also wrote to the members of the Parliamentary Foreign Affairs, Defence and Trade Committee by letter dated 23 October 2001 providing them with a copy of our terms of reference and inviting them to contact us if they wished to contribute to our review. We were not approached by any member of the Committee, although we interviewed Hon. Max Bradford in his capacity as the former Minister of Defence and also Mr Ron Mark MP, the latter primarily in connection with our report on allegations relating to accessing his personal Army files. We received one submission from a member of the public.

12 Having now completed our review, we are satisfied that the process which we adopted was the right one in the circumstances. Since 28 September 2001 we have interviewed a total of 75 people, 5 on more than one occasion. Without exception, everyone interviewed was willing to assist us fully and frankly. Defence personnel had instructions from the Chief of Defence Force to provide us with any information which we sought and they did so. All other persons co-operated fully. A complete list of the persons interviewed appears in Appendix 2 to this report. On several occasions we were welcomed by those interviewed in the Defence Force as providing an opportunity for them to express views to an independent panel. We record our appreciation of the assistance provided by all those interviewed.

13 In the course of our review we interviewed senior personnel at Defence Headquarters in Wellington and also at the Headquarters of the single Services; Ministry of Defence personnel; heads of other relevant Government departments and persons responsible for security intelligence; staff from the office of the Controller and Auditor-General; as well as a range of others including the former Chief of Defence Force (Lt General Tony Birks), the former Chief of the General Staff (Major General Piers Reid), the former Secretary of Defence (Mr Gerald Hensley) and the former Chair of the Parliamentary Foreign Affairs, Defence and Trade Committee (Hon. Derek Quigley). The questioning of Defence personnel included interviews conducted at Trentham (the Joint Forces Headquarters), Linton Military Camp, Whenuapai Air Force Base and Devonport Naval Base. At each of these places we interviewed commanding officers and groups of mid-ranking officers. We found that these interviews gave us a valuable perspective for our review.

14 In addition to conducting the series of interviews, we sought and obtained a substantial amount of documentary material, some of a background nature and some directly relevant to our terms of reference. An index of the key documentary material which we received is contained in Appendix 3 to this report. The directly relevant documentary material included -

14.1 Lists of information believed to have been disclosed without authority over the past 2 - 3 years provided to us by the current Minister of Defence, the former Minister of Defence, the Chief of Defence Force, and the Chief of the General Staff. A summary list of unauthorised disclosures is contained in Appendix 4 to this report.

14.2 Comments on these lists provided by the Chief of the Defence Force and the Secretary of Defence.

14.3 Defence Force Orders and memoranda issued by the Chief of the Defence Force and instructions to his Ministry by the Secretary of Defence relating to the areas covered by our terms of reference, including classified information, official information, protected disclosures and the unauthorised disclosure of information.

14.4 A Crown Law Office opinion on the constitutional nature of the relationship between the Defence Force and the Government of the day (sought by the State Services Commission and the Defence Force). A copy of the opinion is contained in Appendix 5 to this report.

15 As already noted, our terms of reference required us to co-operate and consult with the other reviewers. To the extent appropriate, we have been in touch with Mr Don Hunn, who is carrying out the accountabilities review, and Mr Colin Carruthers QC, who is carrying out the review for the Judge Advocate General.

16 As anticipated in our terms of reference, we have in the time available obtained the information which we required to carry out our review without needing to exercise any powers under the Commissions of Inquiry Act 1908.