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Budget leak: Nats’ behaviour “entirely appropriate”?

By Steven | May 29, 2019

I’ve just been listening to Simon Bridges’ press conference at Parliament about the budget leak. His main point was to deny that the leaked budget material was a result of a hack. But he made the broader claim that the Nats’ behaviour throughout was “entirely appropriate”. He said there had been “nothing illegal or anything approaching that from the National Party.” He denied that their conduct was at any point unlawful.

I think he’s wrong. I think the Nats have probably engaged in  unlawful behaviour from the get-go. That’s regardless of whether the budget material they released was hacked. The Nats have broken the law relating to Breach of Confidence.

That’s not a crime. It’s a civil claim, like defamation or negligence. But it is the law.

Breach of confidence elements

If information is confidential in nature – that is, not in the public domain – and was created and shared in circumstances in which those possessing it knew is was supposed to be confidential, and was then disclosed without permission, that’s a breach of confidence. That obligation of confidence will usually bind anyone else who comes into possession of the information.

The public interest defence

There is a public interest defence. That’s what usually protects the media when they receive leaks. Otherwise, as you might have noticed, almost all leaks to the media (especially from employees with clear obligations of confidentiality) fall foul of this law. But usually, there will be some substantial justification the media can use. They will be able to point to some significant way the public is being served by the release of the information that would otherwise be protected by the obligation of confidence.

Is there public interest here? I can’t see it. The information was to be publicly released in two days. The National Party could freely criticise it then. How are the public really made better off by learning of these criticisms two days in advance? Is there really any benefit to a matter of legitimate public concern that overrides the obvious – and perhaps even constitutional – confidentiality that attaches to budget papers?

Nor can National argue that it needed to release the information to hold the government to account for its bungling in allowing the leak. It could have made that case without actually releasing the data.

Now, I’m not saying anyone’s going to get sued. There doesn’t seem to be much point (though if the government did sue, there would be an interesting battle over the confidentiality of the Nats’ source  – politicians aren’t protected by the journalists’ source-protection provision in the Evidence Act).

I’m just irritated at the sanctimoniousness of Simon Bridges’ denial that the Nats had done “anything approaching” illegality.

Possible National arguments?

What could National argue? The best I can come up with is: “We felt it was in the public interest to prick the balloon of spin that the government was floating about the budget being a ‘wellbeing’ budget, and itself revealing bits of it in advance, by providing the public with information that revealed these claims to be misleading. In this we were fulfilling our constitutional duty to hold the government to account. And we didn’t release any market sensitive information.”

I don’t think that works. They could make those arguments in two days time and the public would be no worse off. I also note that it turns on the accuracy of the criticism. If the numbers are wrong, or taken out of context, or do not really reveal any misleading government behaviour, that would undermine any attempt to say that the releases were in the public interest. Finally, the fact that the National Party was drip-feeding the leaks tells against any claim that the public needed to have the information urgently and couldn’t wait two days for the budget.

A couple of other arguments for National occur to me. One is that, as recipients of the information, they were not bound by the confidence. It is only those who have “acted unconscionably in
relation to the acquisition of information or in the way it has been employed” who are bound by the confidence. They didn’t hack it themselves, they’ll say. They didn’t steal it. It didn’t do any real harm. They didn’t reveal any sensitive part of it. They believed its use was lawful. Maybe they even took legal advice.

I don’t think that works either. The Court of Appeal has made it clear that the main factor in assessing whether someone has behaved unconscionably in using information is whether they knew (or should have known) that it was confidential. That’s just a slam dunk here. They can’t say that they didn’t know how secret the budget material was supposed to be. They have done harm to the budget process, at the very least. If their use of the material was selective and inaccurate, they’ve also done unfair harm to the government. If they took legal advice, then I think it would have been negligent not to advise of the law of Breach of Confidence and the (legal if not practical) risks involved. I note that Simon Bridges is himself a lawyer.

Finally, there are some cases that say that the government is a bit different in Breach of Confidence cases. The information it possesses is really the people’s information. So, to sue for Breach of Confidence, the government must show that there’s a public interest in keeping the information secret. That might be hard here. The flip side of the observation that there’s not much public interest served in hearing about the budget in advance is that, at least in relation to what the National Party did actually disclose, there wasn’t much harm done to the government. Besides, the government itself had been selectively releasing some of it. Still, it would be a brave lawyer who argued that there was not a compelling general public interest in keeping budget information secret prior to budget day. Obviously some of it could be extremely market sensitive (and I’m not saying the National Party released any of that). But the early release of some of the rest may have implications that are not immediately obvious. And the release of drafts may be dangerous. Since there may be changes as the budget evolves, a court is likely to see an important public interest in the integrity of the budget process as a whole.

I am inclined to think there was a Breach of Confidence here. You could argue the toss. But you can’t argue that National have not done anything “even remotely approaching illegality.”

UPDATE: I should add that if National got it through some area of Treasury’s (or some other government) website that was technically publicly accessible, then that would at least raise arguments that it wasn’t confidential in the first place, because it was in the public domain. That might depend on how easy it was to find and extract. But I suspect a court would be reluctant to say that it was not still confidential, especially if few knew about it.


National have denied that the information came from a hack. They won’t tell us how they got it, but it must follow that they know how it came into their possession. It seems the most likely path is through an official. (UPDATE: unless it was taken from a government website as above).

If that’s the case, then that person was probably committing an offence:

Every official is liable to imprisonment for a term not exceeding 7 years who, whether within New Zealand or elsewhere, corruptly uses or discloses any information, acquired by him or her in his or her official capacity, to obtain, directly or indirectly, an advantage or a pecuniary gain for himself or herself or any other person.

I think it’s hard to argue that an official who is releasing secret budget information to the opposition for the purposes of embarrassing the government is acting anything other than corruptly, and is surely doing it to obtain an advantage for the National Party MPs. It’s also hard to see how that official could be regarded, even colloquially, as a whistle-blower. (Legally, they would not fall under the protections in our whistleblower protection law).

Any person who encouraged such an official to release such information would potentially be criminally liable as a party to the offence. I’m not saying the National Party did that. I am saying there are some questions to be asked. And one of them might be: even if you didn’t encourage your source to provide you with that information, what it ethical for you to profit from what seems to have been obviously criminal conduct?

Again, how did the public really gain from it?



Topics: Breach of confidence | 1 Comment »

One Response to “Budget leak: Nats’ behaviour “entirely appropriate”?”

  1. Daybook and Politics. – Dark Brightness Says:
    May 29th, 2019 at 3:36 pm

    […] has got parts of the budget (due in a couple of days, and always commercially sensitive, as our currency floats) early and published them. There are accusations that this was a hack. But […]