Orr omnishambles redux: The ‘personal decision’ that wasn’t really personal

Wednesday, 11 June 2025

Reserve Bank Governor Adrian Orr announces the dropping of the OCR in November. He quit a few months later.

ANALYSIS: When is a personal resignation, well, personal?

In a document dump from the Reserve Bank of New Zealand, releasing various correspondence to the public under the Official Information Act about the sudden resignation of former governor Adrian Orr, that is the question that leaps out of the pages of media stratagems and planning.

The Bank (RBNZ) now says Orr left because he felt he could not continue as governor with a lower amount of funding than the RBNZ board was willing to accede to.

Of course the initial press release from the bank announcing his departure gave no reason at all.

Reserve Bank Governor Adrian Orr resigns abruptly, with Professor Neil Quigley, Chair of the Reserve Bank Governance Board, confirming there's no misconduct involved. Orr opts not to address the media.

But the documents show that planning for the internal and external announcements and comms around the departure, which the bank named “Project Baroda”, include the repeated rationalisation and reason given for his exit as a “personal decision”.

This is undoubtedly true - if one takes the view that any decision by anyone to resign is ultimately a personal one - i.e. a decision made by a person, in this case Orr.

But if using a real-world understanding of the term “personal”, rather than the semantic, low-on-EQ and economical-with-the-truth version favoured by the central bank, it was not personal.

Personal usually means burn out, being sick of the job, having an illness or just wanting to retire (or sometimes it might be a euphemism for other matters).

It was none of those things.

And while Orr did make a “personal decision” in the sense that he wasn’t pressured or asked to leave, he did not leave for personal reasons, conventionally understood.

He left for a principled and even practical one: that in his view the bank would not be able to undertake its legal functions with the amount of money that the board had agreed to take from the Government for the coming five years.

You can disagree whether that principle was a significant one, or that Orr’s view of the practical effect of the funding reduction was wrong or that the nature of the role of the governor is to be a price-taker in those negotiations. But either way, Orr felt that he could not continue under those circumstances.

Let’s go to the RBNZ’s statement “explaining Mr Orr’s departure”, released with the documents.

It says: “By the date of the February meeting of the board (27 February) it was clear that the Board and Minister of Finance were willing to agree to a considerably lesser amount than the amount Mr Orr thought was the minimum necessary.

“This caused distress to Mr Orr and the impasse risked damaging necessary working relationships, and led to Mr Orr’s personal decision that he had achieved all he could as Governor of the Reserve Bank and could not continue in that role with sufficiently less funding than he thought was viable for the organisation.”

Reserve Bank board chairman Neil Quigley speaking to reporters after Adrian Orr's shock resignation.

It then says that both the bank and Orr retained senior counsel and negotiated an immediate exit.

Saying that it was personal, while semantically technically true, was a distortion of the truth which the bank now effectively cops to. Whatever negotiations went into using that language, those who agreed to it and then used it should take undertake some careful self-examination.

With the Reserve Bank’s independence comes a requirement for both probity and openness to the extent that the bank can do so without prejudicing its role as either a regulator or a policy maker - particularly in the setting of interest rates.

And when it came to interest rates, the bank is open. It publishes reasons for things then fronts media at Monetary Policy Statements to explain the thinking.

The worst sort of media management bends or has little regard for the truth, treating the public or customers like morons. After the last few years of inflation and hip-pocket hurt, the last thing the bank should have done was not be honest with both its staff and the public about the substantive reason why the man who was in charge during that period was leaving - while at the same time offering worried staff wellness leave and EAP services, according to the documents.

Who thought that was a good idea?

There is no problem with Orr leaving for the reasons that the bank says he did. And there is no problem with the public knowing it. Nor was there on March 5 when he resigned. It would not have materially changed the media management or raised any more questions about bank independence given that the board, which negotiated with Minister of Finance Nicola Willis, was going to agree to the lower sum.

Whoever came up with that strategy and the language around it produced just the sort of political-corporate doublespeak that degrades faith in institutions - especially one meant to be able to stand apart from government and the sort of image considerations that drives political incentives.

Adrian Orr thought the bank needed more money. His board disagreed, the Minister of Finance disagreed, he found the process distressing and he resigned. While not common, the system allows for this and other senior public servants do the same from time to time.

Giving the impression that it was for some undisclosed personal reasons - as the bank has done for three months now which no one really believed, and which the bank confirmed on Wednesday was not really the case - covers no one in glory and leaves an important national institution just a little poorer.