A Little elephant in the room – Part 2

So it’s been established that Andrew Little, leader of the Labour Party doesn’t like people who evade paying tax. So why does he employ one as his Chief of Staff?

That’s a pretty fair question, don’t you think? It’s probably one that David Cunliffe should have considered before he hired Matt McCarten in 2014 and set up the infamous War Room. And it’s certainly something Andrew Little should have considered before he went full retard on John Key over the last two weeks, and before he made a factually incorrect attack on John Shewan.

Matt McCarten and Unite Union’s tax issues first became a public issue in 2010. Rebecca Steven reported this in Stuff on 2 December 2010:

One of New Zealand’s largest unions, Unite, owes IRD over $130,000 including over $36,000 in tax meant to be paid on behalf of its employees.

The union’s accounts, which can be publicly viewed through a Government website, shows Unite’s liabilities exceeded its assets by over $170,000 for the year ended March 2009.

A further $57,630 is owed to the Government tax collector for GST.

Unite head Matt McCarten admitted to BusinessDay this afternoon that the union owed money to IRD and said the union was “keen” to pay.

He said it was “not that much in the great scheme of things”.

PAYE stands for pay-as-you-earn. This money is collected from employees by employers and then paid to the IRD.

Right-wing blogger David Farrar said on his Kiwiblog this was a very bad look for a trade union as it meant Unite had been collecting the tax but not paying it.   

“Over $36,000” might have been “not that much in the great scheme of things” to McCarten, but I am sure it would have come as a very nasty surprise to the staff of Unite Union, who could rightly have expected their boss to pay the money he had deducted from their wages to IRD.

The next day, Stevenson reported that the CTU had issued McCarten a “please explain”:

The Council of Trade Unions wants an explanation from Unite on why it failed to pay the IRD more than $36,000 in PAYE on behalf of its employees.

Further on in that story however, we get an insight into the mind of a union member:

Unite head Matt McCarten confirmed yesterday that the union owed money to the IRD but said he had made choices to pay for union campaigns rather than clear the debt. “I don’t shy away from these decisions, I make the calls.”

He said Unite paid $8000 in PAYE each month to the IRD but kept incurring late payment penalties. He claimed not to know exactly how much it owed the IRD.

He agreed it was not a good look for a workers’ union to fail to pay its employees’ tax.

This is the real nub of this issue as far as Andrew Little is concerned.

Why does Andrew Little continue to make allegations about the Government being soft on tax evaders when he employs someone who, as the next instalment will show, has wilfully failed to meet his employer obligations?




THANK YOU for being a subscriber. Because of you Whaleoil is going from strength to strength. It is a little known fact that Whaleoil subscribers are better in bed, good looking and highly intelligent. Sometimes all at once! Please Click Here Now to subscribe to an ad-free Whaleoil.

  • Sally

    Keep it coming let the sunlight in to expose the tax dodger who is in charged of the Labour Party’s backroom and what a hypocrite Little is.

  • Mine it,Drill it,Sell it.

    I know it is early in the morning but have I missed something.Is this part one or two ?

  • wanarunna

    I do have to disagree with the description of PAYE. It is not collected from the employees, it is, in theory, deducted from the amount that the employer has to pay to the employee. From a cashflow perspective there is a difference, given that PAYE is payable to the IRD at a later date than the wages and salary are paid to the employee

    • Keeping Stock

      It’s pretty simple from IRD’s perspective wanarunna – you deduct the PAYE, you pass it on to IRD on the 20th of the next month, or you face consequences.

      • Huia

        Simple you would think Keeping Stock. My last boss did this very thing to two people who managed his factory.
        So far there has been no action and its now been six years, I think they have now given up the chase because of ill health and falsified records.
        The IRD tell them it is a Police matter and the Police tell them it is an IRD matter.

      • wanarunna

        Not questioning the legalities of it at all, just the way PAYE has been described as being collected from employees by employers and then paid to the IRD. An employer paying an employee say $400 per week is meant to deduct $57 (or thereabouts) from the payment, put it to one side and pay it to the IRD on the 20th of the following month. In reality, many employers will see their weekly cash flow obligation as being to pay the employee $343, with another lump sum payable to the IRD on the 20th of the month.

  • Toby

    Oh you mean to say when the lefties complain the Government won’t spend money on things, they actually mean other peoples money, not their own.

    Imagine if everyone who owed tax said “its not that much in the grand scheme of things”

    • RockinBob625

      Can I steal a $36000 car and say “it’s not that much in the grand scheme of things” ? The next benefit fraudster who has $36000 extra “it’s not that much…”


  • Platinum Fox

    As I understand it, employees are indemnified by the government (which really means by other taxpayers) if their employer fails to pay PAYE deductions to the IRD but this indemnity does not extend to cover non-payment to IRD of Kiwi Saver contributions.
    Do we know if the Kiwi Saver contributions for Unite’s staff were also not paid?

    • dumbshit

      I was about to allude to a situation a nephew related to me. A transport firm he worked for had not payed the correct amount of paye, and he had to top it up plus late payment fees at the end of the year.

  • Orca

    Surely if Unite Union’s Liabilities exceed its assets, then that means that they are insolvent. As I understand it, it is an offence to continue to operate an insolvent company, in this case a union. Who is going to call in the receivers?

    • Disinfectant

      Don’t need a threat, just file an application to wind them up.
      IRD does this every day. Yesterday the Press had about three of them.

  • I thought it was illegal to not pay IRD PAYE?

    How come IRD aren’t prosecuting McCarten?

    Usually they are like rabid dogs chasing businesses that owe them money and this guy has flat out admitted he spent the money on something else.

  • Dumrse

    Saturday morning and what a glorious day outside in the sunshine. Keep it shining WO.

  • Spiker

    I’m pretty sure if I treated my tax obligations in the way Unite & McCarten do I’d be in a whole lot of trouble with IRD. Why are they apparently treated differently?

  • pisces8284 .

    Strapped for cash, we were late with our GST payment. IRD were on the phone straight away. How does he get away with it?

    • Woody

      They get even grumpier even faster if you are late with PAYE, I inadvertently missed a payment once, I was not left in ignorance for very long.

  • Woody

    There is that “Not a good look” phrase again but from Matt the brat this time. I have to conclude that Andy is a simple (read that how you will) mouthpiece for McCarten who is the real puppeteer in charge of the Labour party. this would explain why Andy gets so flummoxed when he finds himself off script, he has no idea what Matt would want him to say.

  • cows4me

    “United head Matt McCarten admitted to business day this afternoon that the union owed money to the IRD and was ‘keen’ to pay”. Yeah sure and I’m the Queen Mother.

    • Left Right Out

      Being “keen” to pay and actually paying are vastly different things

  • Catriona

    People usually end up in jail if they prolong paying P.A.Y.E is my observation. So how come United hasn’t been hunted down and dealt with? Labour don’t seem to understand “people who live in glass houses shouldn’t throw stones” it appears. The most important thing they need to remember is to check their facts before they shoot their mouth off.

  • XCIA

    I’ve often wondered if McCarten was actually offered the job, or being the blagger he is, did he just appoint himself because he knew where all the bodies were buried and what skeletons where in who’s cupboards, so no one could object.

  • Keanne Lawrence

    The real gem is “he had made choices to pay for union campaigns rather than clear the debt. “I don’t shy away from these decisions, I make the calls.”
    This provides the perfect opportunity for employers to pass the collection of union fess over to the unions and see if the members agree it is “not much in the great scheme of things”. One law?
    The truly hilarious thing is the rank and file, flax/grass roots or whatever the current term is for minions are paying these muppets every week. Lol

  • sandalwood789

    I’d *love* to be able to pay no tax.
    After all, my tax is “not that much in the great scheme of things”.

  • Keyser Soze

    Can I get away with making the choice that a new 65″ TV is more important than my tax obligations? I won’t shy away from the decision. I’ll make the call.