An exposé published by the NZ Herald today has blown open a stark loophole in our political transparency regime. Journalist Chris Knox has shown how National MP Carl Bates, a first-term MP for Whanganui, effectively hid a property empire of 25 houses behind family trusts – none of which appears under his name in Parliament’s official Register of Pecuniary Interests. Many of these homes are rentals in his own electorate, making his family one of Whanganui’s largest private landlords. See Knox’s story here: MP put 25 properties in family trust before facing financial declaration rules (paywalled)
Bates insists he’s done nothing wrong, claiming he’s “merely a discretionary beneficiary” of the trusts and has “declared everything required” under the rules. In other words, by shuffling his real estate into a trust just before entering politics, Bates escaped listing those 25 properties on the public register – technically complying with the letter of the law, while thwarting its spirit.
It’s a brazen example of how MPs exploit trust structures to dodge transparency. I’m quoted in the Herald story, saying, “This is a real can of worms. The nexus between housing ownership, pecuniary interests and politicians is of great public concern in New Zealand. If politicians can get away with not reforming this area, they will. There really has to be extra strong pressure put on the institution of Parliament to clear this up because it’s just going to reduce public trust in the political process more and more, and rightly so.”
Carl Bates’ trust shell game
Chris Knox’s Herald article today shows that the mechanism used to shield these assets from public disclosure is a masterclass in legal obfuscation. Public records show that when Bates was elected, he held shareholdings in two family-owned real estate investment companies which, between them, owned the 25 properties. Shortly after his election, a new entity named "Seize the Day Trustee Company Limited" was established. Within a week, Bates’s shareholdings in the two property companies were transferred to this new trustee company. This trustee company, in turn, is understood to be held by The Carpe Diem Trust, of which Bates is a declared beneficiary.
This two-step structure — placing the property-owning companies under the ownership of a trustee company, which itself is held by a trust — creates a legal firewall. Under the current ambiguous rules, this allows the MP to claim he has no direct interest in the properties themselves.
In his defence, Bates has maintained that he has followed all required procedures. He told the Herald, “Upon becoming an MP, I met with the Registrar of Pecuniary Interests in advance of filing my return to ensure I would be declaring everything required of me”. He further stated, “The Registrar advised me that property held in a company whose shares are held by a trust, was not required to be declared”.
This defence is the crux of the issue. It demonstrates that the problem lies not with an individual MP brazenly breaking the rules, but with the rules themselves being so porous as to be functionally useless in such circumstances. The Registrar, Sir Maarten Wevers, is constrained by the flawed Standing Orders and can only provide advice based on them. His office declined to comment on the specifics of the case.
This situation has, rightly, drawn sharp criticism. The political blog No Right Turn described the arrangement as “deeply dishonest and corrupt”, even if it is technically “within the rules (which we all know are bullshit)” – see: A clear conflict of interest. This sentiment reflects a wider public concern about the nexus between politics, property, and power
Widespread use of trusts by MPs
The Bates saga should be a catalyst for cleaning up this mess – but he is far from the only offender. A deep dive into the newly released 2025 Register of Pecuniary Interests reveals that Bates is one of many MPs using trusts to shield real estate assets from full public view. In fact, by my count, over a dozen MPs (across party lines) hold houses or land via family trusts or similar entities rather than in their own names.
This includes some of our highest-profile lawmakers. For example, National’s deputy leader Nicola Willis lists three houses owned by her family trust (the Appledore Trust), in Kelburn, Wānaka, and Wairarapa, on top of her own jointly owned home.
Former National leader Judith Collins similarly records her Auckland family home as “owned by trusts,” and even her Wellington and Nelson investment properties are held via a personal superannuation scheme. Senior National MP Andrew Bayly declares a portfolio of properties all held in trusts or companies, including a family home, a Waikato farm, and apartments in Wellington and Queenstown, none of which are in his personal name.
And it’s not just the Nats: Labour’s Camilla Belich discloses a family holiday home owned by a trust, while Te Pāti Māori’s Hana-Rawhiti Maipi-Clarke, Act’s Cameron Luxton, NZ First’s Winston Peters – the list goes on – all appear to have taken advantage of trust arrangements for real estate.
In total, well over 15 MPs (more than 1 in 8 of our parliamentarians) are using trusts to hold residential or commercial properties. That amounts to dozens of homes and parcels of land effectively tucked behind trust walls, partially invisible in the register.
But it’s hard to know without further investigation how many additional MPs have hidden property in their trusts (in a similar way to Carl Bates). When I went through last year’s Register, I found that collectively, MPs are involved in more trusts than there are members of Parliament — about 130. National had the most MPs with trusts — 35 MPs or 71 percent of the caucus, with the Cabinet having an exceptionally high proportion of ministers using trusts — 75 per cent. For more, see my 2024 column, MPs’ financial interests under scrutiny.
Therefore, the current Register is actually quite opaque. The public might scan the disclosure summaries and see some MPs claiming to have “no real property”, only to later learn that those same MPs enjoy multiple houses via family trusts or shell companies. This gap between technical disclosure and meaningful transparency is precisely what the Register was supposed to bridge. Instead, it’s becoming a joke – a register of half-truths and legal omissions.
Transparency vs Technicalities
The intent of the pecuniary interest rules is clear: to “provide transparency and strengthen public trust” by revealing MPs’ financial interests, especially in areas like property, business and investments that could conflict with their duties.
Standing Orders were even tightened in 2010 (after the Winston Peters donations scandal) to clarify that “all distinct interests must be declared, regardless of whether they are channelled through a trust or third party.” In theory, an MP benefiting from a trust that owns real estate should list those properties just as if they owned them outright. In practice, however, MPs have found ways to game the system. They exploit the fine print and leniency of the Registrar’s office to avoid full disclosure.
For instance, some MPs argue that if they’re merely one beneficiary among others in a family trust (with “discretionary” interest), then the houses it owns aren’t technically their assets to declare. Others rely on complex layering – e.g. the trust owns a company which owns the property – hoping that such indirect interests slip under the reporting threshold.
Indeed, Parliament’s Registrar of Pecuniary Interests, Maarten Wevers, when asked about the Bates situation, pointedly declined to say whether properties owned by companies owned by trusts must be declared, noting “it remains the responsibility of each member to identify their interests”. That sounds like a diplomatic way of saying the rules are ambiguous and easily sidestepped.
Bates himself, when challenged, effectively said “trust us, we’ve complied.” But the public shouldn’t have to trust what they cannot verify. The current system allows MPs to obey the letter of the law while concealing the spirit of their wealth. It’s transparency theatre.
Conflicts of interest – Housing policy and self-dealing
Why does all this matter?
Because it strikes at the heart of public trust in our lawmakers. New Zealanders expect MPs to legislate in the public interest, especially on pressing issues like the housing affordability crisis. But how can we be confident in housing policy when so many MPs are large-scale property owners and landlords themselves?
Nearly half the Cabinet in recent years have owned multiple properties. Now we discover a significant chunk of MPs (particularly in the new government) have extensive real estate holdings cloaked behind trusts. These politicians have a direct personal stake in the property market – in high rents, rising house values, and lax landlord regulations.
Is it any wonder that bold housing reforms (like stricter rental standards, a capital gains or wealth tax, or measures to rein in speculation) are so often watered down or blocked? The pervasive use of trusts to hide property assets suggests that MPs know their holdings would look unseemly, even unethical, if fully exposed.
An MP with a dozen rental properties might think twice about openly voting to, say, end the tax write-offs for landlords. But if those properties are quietly stashed in a trust, the conflict stays off the front page. This murkiness erodes confidence that policies are being made for New Zealanders writ large, not for MPs’ own portfolios.
It also betrays younger and less wealthy Kiwis: How can our representatives truly empathise with people locked out of home ownership or struggling with high rents when they are busy amassing (and concealing) property fortunes? The optics alone are damaging — MPs behaving like a privileged class with insider tricks to guard their wealth.
Every new revelation (be it Michael Wood failing to disclose airport shares, or Carl Bates quietly parking 25 houses in a trust) further alienates the public from the political class.
Loopholes, scandals, and stalled reform
Parliament has periodically been forced to confront these issues – usually after a scandal blows up. In 2008, Winston Peters infamously failed to declare a $100,000 donation (channeled through the Spencer Trust) and was hauled before the Privileges Committee. The committee’s rebuke led to tighter wording in the rules.
More recently, Labour’s Michael Wood was censured for not updating his pecuniary interests (over shares held in his own name). In its final report, the Privileges Committee investigated the question of whether assets held within a trust needed to be declared. While the Registrar argued they should, the committee concluded that under the existing Standing Orders, it was not explicitly required. However, both the Registrar and the committee agreed that more clarity was needed.
Since that official recommendation was made, absolutely nothing has changed. The Standing Orders Committee has not acted, and the ambiguity that protected Michael Wood from a finding of contempt has been left in place, creating the very conditions that now allow for the non-disclosure of 25 properties. Parliament was officially notified of this precise loophole but failed to close it. This inaction has moved the issue from one of reactive negligence to one of proactive inertia.
So here we are in 2025: the 2025 Register still allows MPs to obscure substantial interests. The Standing Orders Committee (which sets the rules) has so far dithered on closing these trust loopholes.
Why? We can guess that turkeys don’t vote for an early Christmas. Many MPs benefit from the status quo, so reform keeps slipping down the priority list.
There have been “stated intentions” to tighten the regime. Speaker Adrian Rurawhe signalled in 2023 that the next Standing Orders review would consider changes. But talk is cheap. The Standing Orders triennial review is happening right now, with public submissions open until Thursday September 25, and one hopes this trust rort is front and centre.
I’m quoted on this in the Herald today: “One of the best ways that this might be corrected is through the review of the standing orders. It sounds like a really boring, dry process, but this is something that does have an impact on whether our democracy works. Anyone with an interest in fairness in politics needs to put in a submission to clear this up.”
Without a loud public outcry, however, MPs may well paper over the issue. After all, they enjoy the advantages of the current system. It’s a classic case of legislators being asked to regulate themselves, and thus far, they’ve shown an inclination to preserve their loopholes and opaque arrangements. Unfortunately, without public pressure, the poachers will continue to write the rules for the gamekeepers, and public trust in our democratic institutions will continue to decline.
Urgent need for true transparency
It’s time for this charade to end. New Zealand politicians endlessly claim that the country has low corruption and open government, but our MPs’ pecuniary interest disclosures are lagging far behind best practice. Other countries are moving to tighten rules around politicians’ wealth (for instance, Australia is debating banning family trusts for ministers; the UK is cracking down on anonymous property ownership). We should expect no less from our Parliament.
At minimum, any beneficial interest in a trust that owns property should require full disclosure of those properties – no more hiding behind “family trust” labels without details. The onus must be on MPs to prove they have nothing to hide. The register should be administered by an independent body with teeth, empowered to investigate inconsistencies (like a trust showing 25 properties in public records when an MP only declared two).
Consequences for obfuscation or non-compliance need to be real, not just a slap on the wrist, but potential suspension or other sanctions to deter the cynical “oops, I forgot” routine we’ve seen. Above all, we need a culture change: MPs should embrace transparency as a duty, not a game of hide-and-seek. As things stand, the integrity of our democracy is undermined when lawmakers exploit devices like trusts to keep their constituents in the dark.
In a housing crisis, with public cynicism rising, the continued existence of these loopholes is untenable. It serves only the self-interest of MPs acting as lawmakers by day and secret landlords by night. The public deserves to know who our representatives really are and where their vested interests lie. Sunlight, as always, is the best disinfectant.
Parliament should waste no time in reforming the rules to require genuine transparency. If they don’t, New Zealanders are entitled to ask: whose interests are our MPs really serving – the public’s, or their own? And if the answer is the latter, the breach of trust may prove far more corrosive to our political system than any short-term embarrassment a tougher disclosure regime might cause.
As I argued in the Herald story today, only “extra strong pressure” on Parliament will force change, because otherwise politicians will happily leave this area murky. Consider this Integrity Briefing my contribution to that pressure. It’s well past time our Parliamentarians came clean and closed the loopholes that have enabled their opaque financial arrangements.
New Zealanders deserve representatives who lead on integrity, not lag behind the law’s loopholes. The longer MPs resist true transparency, the more they will feed the public’s suspicion that they have something to hide – and the more they will damage the already fragile trust in our democracy. So, MPs please reform these rules, now – or risk the cynicism and disengagement of the very citizens you are supposed to serve.
Dr Bryce Edwards
Director of The Integrity Institute
An informative exposé thank you Bryce. Completely agree that we all "deserve representatives who lead on integrity". Such underhand obfuscation is appalling, legal or not. Also generally galling are the crocodile tears about non affordability of housing followed by a great cheer when the "market improves".
An excellent resource thankyou Bryce. If we ever get an individual wealth tax of whatever kind it will require an assessment of beneficial ownership of all assets regardless of how they are held. Maybe the IR should be researching this issue especially for residential housing. If individual have to declare all such ownership for a new net equity/ wealth tax (or risk fraud prosecution) maybe the political transparency problem would disappear?