State Sector Amendment Bill

I am very pleased to speak to this part. I would like to commend my colleague Judith Collins for an exemplary speech to the Committee raising some very important points with regard to Part 1. Part 2, about reorganisation with regard to the public sector, is a pretty substantial part. I would like to raise a matter that was also raised by one of the submitters to this. In mentioning the submitters, my colleague Judith Collins is quite right that the public sector employees would find it very difficult to put in any form of submission protecting their interests on this bill. They would face dismissal or job placement elsewhere—maybe even legislation to move them along.

I would like to bring the Minister’s attention to a document I have here called Legislative Change: Guidelines on Process and Content, revised edition. This was report No. 6 by the Legislation Advisory Committee. This document talks quite clearly about the role of transparency with regard to State sector departments. One of the things this document says is that Parliament should have to approve the addition of new departments to the list of departments scheduled to the State Sector Act 1988, as well as deletions and alterations, and it also recommends that departmental statutes and related legislative provisions should not, in general, be enacted.

Here we have some major concerns around the rearrangement of State sector departments. There should be public and parliamentary debate around the legislative processes to test the merits and demerits of any changes that are proposed. But this part of the bill takes all of that away. That denies the public the right to ensure that the processes and the provisions in their interests will be protected. That is absolutely wrong. They should be able to make sure that whatever has been put in place to protect the interests of the people are clear, transparent, and accountable.

If we adopt the provisions in Part 2 we are shutting down that openness and that transparency, and the public interest will not be well served in that regard. The recommendations come from some pretty substantial people. There is a list of the components of that committee, and their recommendations should not be ignored.

These are the guidelines that have been accepted by this Parliament. They say that the responsibility of developing legislation in accordance with the guidelines rests with the Minister. We have already seen that he has failed in a number of respects in introducing this legislation. He has failed to provide the opportunity for the Supplementary Order Paper to this amendment bill to be put before the select committee, and that is a gross omission. That is an absolute failure of fiduciary duty of this Government. I note that the Hon Lianne Dalziel used that term today—fiduciary duty. Do Government members understand its use when they fail to ensure that the fiduciary duty of the Government has been followed in regard to this Supplementary Order Paper?

I was about to tell members who made up the committee for setting the guidelines for legislative changes, and those legislative changes are meant to be the responsibility of the Minister. I find it surprising that he wants to ignore these recommendations, given the calibre of those who made them in the first instance: Professor F M Brookfield, Mr J G Fogarty QC, Mr A R Galbraith QC, Mr W Iles QC, CMG, Sir Kenneth Keith, Dr Mervyn Probine CB, the Hon Mr Justice Robertson, Judge D F G Sheppard, Mr C J Thompson, Adrienne von Tunzelmann, and Rodney Harris as secretary. The calibre of those people is substantial.

It is interesting that today we are debating a Supplementary Order Paper that covers Part 2, and which is a complete rehash of the bill that we debated way back in July 2001. I was in that debate on 11 September 2001. Here is the bill that we debated then, and even at that time I said that this had been rushed through because we had 4 weeks from introduction through to the second reading and the select committee. One of those 4 weeks was a recess week. In effect we had only 3 weeks, and we heard nine submissions at that time.

Here we have a Supplementary Order Paper tabled at the eleventh hour last night that nobody has had an opportunity to go through to see what it means. What impact does this have on the Government’s organisations? We do not know what the impact is, because this Government, at the eleventh hour—which it so commonly does—drops legislation on us where there is no scrutiny, no opportunity to go through to appraise the legislation, to debate it, and to scrutinise the impacts of it, because this was dropped on us last night.

When I look at this Supplementary Order Paper, which in effect absolutely replaces the whole of Part 2 that was in the bill, I see that it is a complete rewrite. This Government is now in the habit of trying to sneak this stuff through at the eleventh hour without that opportunity of clear scrutiny and transparency that we would expect. If we look at what this bill is to do, we see that it will allow by Order in Council the executive to make the decisions about merging. It will make the decisions about what happens to staff and chief executive officers. Under this regulation, people will not have to fire anybody, because they just amalgamate or abolish the department, and there will be no redundancies for those people. We are aware of what happened with the Rankin affair.

I want to bring the Committee’s attention to a very important message in a submission made by the Regulations Review Committee dated 15 August 2001. I was a member of that select committee at that time. This is the point that was made: “We question whether there are sufficient reasons to allow an Act of Parliament to be amended by a regulation in this way.” It said that there needed to be much closer scrutiny. It then went on to say: “The proposed change may be administratively convenient, but this must be weighed against the loss of parliamentary oversight.” That is a very, very powerful message. That came from the Regulations Review Committee, of which I was a member at that time.

It goes on to say that the amendment will allow an Act of Parliament to be amended by a regulation. This is a Government that is using more and more regulations to get what it wants—more and more regulations so that the scrutiny of Parliament does not take place. This is the place that we should scrutinise these things. This is the place where we should debate these issues, but when this bill is passed it will allow by Order in Council the executive to make those changes. National’s position is very, very clear. We believe that it is an abuse of the process and that it politicises the process and it is something that we will not support.

The Regulations Review Committee also made the statement that the amendments will allow an Act of Parliament to be amended by regulation. I am stating that again, because that is what will happen. It goes on to say: “It is therefore important to consider whether there are sufficiently strong reasons why this matter should be dealt with in regulations rather than primary legislation.” That is the message that the committee set. It had doubts about the process going by regulation and said that there were insufficiently strong reasons that it should not be through primary legislation.

This amendment, and in particular the Supplementary Order Paper that introduces all the provisions to exclude the State sector from the consequences of deemed redundancy on reorganisation, should be an automatic benefit for everyone in the community. But that is obscuring another problem in this part, and that is the constitutional implications of resuming the Department for Courts into the Ministry of Justice. I say there are constitutional implications, because the Department for Courts is shortly expected to have the administrative control of a new Supreme Court. If there is one thing about Supreme Courts around the world, it is that they are intended to have a degree of administrative and budgetary autonomy. That is certainly not expected to be available to the new Supreme Court under the bill that is before the Parliament, or under the pattern that has been established in New Zealand in our Department for Courts model.

Yesterday the Justice and Electoral Committee heard from a person who is regarded as probably the academic expert on top courts in the British system. He is a New Zealander in London. He told us: “Ideally, and in fact commonly, a top court will appoint its own registrar, who will then manage the court’s other administrative personnel appointments.” He had a lot more to say on that, but he said: “It’s a significant detraction from the court’s institutional autonomy, and not consistent with international best practice in the design of top courts, if administrative personnel are treated as ordinary public service employees. The bill should be amended to allow the court to appoint its most senior officers, who should themselves have the responsibility of employing the court’s other administrative staff.”

And there is more in the same vein about budgetary independence and about parliamentary supervision of the budget of such a court. He tells us that in the United States two justices of the Supreme Court, and, in other countries, senior administrative officers, go before a committee of the Parliament to report on operation. In other words, there is a review process. He says: “In a system as relatively small as New Zealand’s, it may be even more important that the court enjoy much greater autonomy in such areas.”

I say to you, Mr Chairman, and to the Minister in the chair, that that is important, because this bill is effecting a merger that has never been explained. Nor has there been any significant report on the effects. Indeed, the Justice and Electoral Committee felt compelled, unanimously—Labour members, members of the Green Party, and other members—to express strong concern about the absence of any explanation of this merger. I quote from our report last month: “We have found it difficult to assess the impact on Vote Justice and Vote Courts, since the merger appears to have been decided upon after the preparation of the 2003/04 estimates.”

We quoted various advice, and then indicated that we did not consider there was an adequate level of discussion for a decision of this importance. We referred to the Auditor-General’s article on organisational change. We have cited the article. We said: “We consider that—as a first step—the purpose of the change and the results sought should be clearly articulated, if Parliament is to be assured that the change is in the public interest, and the effects of the change are to be measured.” This has not happened. There has been no real explanation of why the Department for Courts is being subsumed. The only statements we have had are indeed very worrying when we put them in the context of a Supreme Court that is to have the powers to develop the kinds of laws the Attorney-General, Margaret Wilson, wants it to have.

The purpose, according to what the Minister of State Services said the merger would achieve, is to “enable better coordination of the relationship between the Executive and Judiciary in respect of both policy and administration”. I say to the Minister that we need to know just what is meant by this proposal, that it is not just the executive and the Department for Courts or the administrators. It says “the judiciary”, in respect of policy and administration. Is this an attempt by the executive to bring the judges to heel in policy terms?

I rise to speak against this bill, and, in particular, Part 2. There are many reasons for opposing this bill, and there are many reasons for the Minister to want us to just roll over, like the United Future party and the Greens, and accept this sort of behaviour. One of the things that is very, very concerning about this bill—and I note the submission of the New Zealand Law Society, which has yet again given a very, very good submission—is that it overrides contract law where that contract law is to the benefit of the employee. I say that is wrong.

Many people have entered into employment contracts—either collective contracts or individual contracts, in relation to the more senior members of staff, in particular—and they are entitled to know that their contract means what it states. They are entitled to know that where their Minister has been slack and allowed provisions in the contract, such as technical redundancy provisions whereby they can be paid compensation, they are entitled to the benefit of such clauses, because the contract law should be paramount. In respect of that, I would have thought that those parties in Parliament that are always bleating on about the rights of the employed would actually look at that issue, and consider why they want to take away from employees the rights that they currently have under their contracts. Those particular parties, the Labour Party and the Green Party, should be ashamed of themselves for supporting this bill.

The United Future party, which was not in fact a party at the time when this bill was introduced, should be ashamed of itself, because it has promoted itself as the party of common sense. However, it has shown no common sense here, although it has, in many ways, tried to uphold some centre-right principles in its allegiance with the Labour Party, which has been very difficult for it. Yet here United Future is again saying that the contract law on employment, or employees’ rights, can be stood over by a Minister who loves to bully people—a Minister who loves to try to shout people down—and that he can just continue to do the same to Public Service Association members.

That Minister wants to say the Public Service Association and the Council of Trade Unions made submissions. But I say to the Minister that they did not actually agree with his bill. This bill has been rewritten by Supplementary Order Paper 107, which was lodged only yesterday. It is being rushed through Parliament so that the Department for Courts can be merged with the Ministry of Justice, because obviously the Prime Minister has lost confidence in either one of her Ministers or both of them. Also, the Minister has his eye on any other department or ministry where the chief executive may be doing too well, may be trying to get people off benefits, or may be trying to stand up to a Minister.

The employees of every single ministry should be out there considering their situation, in terms of the fact that the rights they have won through their contracts are being overridden by legislation that is being rushed through the House after sitting around for 2 years. After 2 years of going nowhere, suddenly this legislation is being rushed through without consultation, because the Minister does not really want the employees of the ministries to know what is happening. [Interruption]

I notice that some members on the Government side of the Chamber are calling out “2 years”. They think that makes a difference. But the fact is that if they bothered to look at the Supplementary Order Paper that has been introduced, they would discover that it makes this a different bill from the one introduced then.

I move, That the question be now put.

We are going through a very important process at the moment. My colleague Judith Collins has just said that this legislation is being rushed through. Members on the Government side of the Chamber have said that it has been sitting around for 2 years—that is what they have just said. But the point that we made earlier is that this bill is actually a rewrite, because we had Supplementary Order Paper 107 lodged yesterday at the eleventh hour. No one has had an opportunity to look at it, and what are Labour members doing? They are rushing it through now.

Last night we started on this debate, and here we are today with a completely new bill. Part 2 and all the schedules are absolutely new. The point that I made in an earlier debate was that the original bill went to the Government Administration Committee, which had only 9 days for submissions. I was on that select committee and heard those submissions. Then what happened? The second reading was on 11 September 2001, and the bill sat in abeyance for 22 months. When we came back yesterday to debate this bill, we found that it is not the bill that we had talked about back in September 2001, because we now have a Supplementary Order Paper that is longer than the original bill. We have 13 pages of new material that no one has had an opportunity to look at. The point here is that we believe there needs to be scrutiny and transparency. This is an abuse of the process, because the Minister has lodged a Supplementary Order Paper without the opportunity for anybody to have a say about it.

I want to hark back to the point that Judith Collins and I made about the Law Society. The Law Society stated that the need for cautious assessment of the proposed provisions is given emphasis here because one of the parties to the contracts that are to be overridden by means of statute is the Crown. That is what the Law Society stated; contracts will be overridden by the Crown, by Order in Council. The executive will decide to merge departments, amalgamate them, and abolish them. Those matters will not come back to Parliament, for us to debate and to see the merits or otherwise of—[Interruption] I invite the Minister to take a call and substantiate the reasons that we are debating Supplementary Order Paper 107. It is interesting, is it not, that not one Government member has taken a call on that substantial Supplementary Order Paper?

💬 Hon Trevor Mallard: I did.

Oh well, the Minister says that he took a call, but at that stage we were debating the title. We are now debating the substantive part of the bill, and I would have thought that if the Minister believed that he is not, by regulating, overriding what Parliament can do, then he would take a call to put that matter to rest. The Law Society, in its submission, stated that the Crown would override contracts by means of statute.

The Law Society went on to state that the Crown is not only promoting the legislation but will also be a contractual beneficiary of it. This Government, by regulation, will be able to take away the right of the public to make submissions. This Government is becoming increasingly arrogant, and is increasingly using regulation to push through its programme without the scrutiny of this House, and without the transparency that all members and every other New Zealander expect there to be.

I go back to the point about the Regulations Review Committee. The Minister might like to take a call and answer the question that I put to him earlier on. I invite him again to take the call, because that is what the Regulations Review Committee said. That committee is the watchdog, and the question has not been answered.

Madam Chairperson—

💬 Stephen Franks: I raise a point of order, Madam Chairperson. I wanted to ensure that I did not get into a position where I was debating or questioning the closure motion, but I do ask that before you take the next speaker you consider that Supplementary Order Paper 107 effects a change in the Department for Courts, and there will be no opportunity for select committee discussions on that. This will be the only time that Parliament can debate the detail of that particular change.

The CHAIRPERSON (Ann Hartley): I was going to call the member next, but David Cunliffe has called.

I move, That the question be now put.

I want to make a point that has not been raised, except in the last call that I took, that this bill effects the disappearance of the Department for Courts. The merger announcement, and what I understand to be effectively the only explanation for that, was the statement made by the Minister of State Services on 16 May this year. That merger announcement talked about the justice sector review. A paper to Cabinet released at the same time indicated the merger would have a number of beneficial effects. But there has been, as I understand it, no other explanation of the reason for the provisions in Supplementary Order Paper 107. There has been none of the normal regulatory impact statement that would have been expected, had that measure been in the bill when it came in. There has been nothing to indicate the attention that we would expect to be given to a matter of some constitutional significance.

For example, in this bill we do find a number of changes in the schedules—and I am not debating the schedules at this stage—that point up the extent to which the Department for Courts had been given a position of privilege in relation to information. It has been recognised that the administrative role of registrars and other court officials has an important relationship to the independence and impartiality of justice, and to the perception of a justice system that is not affected by executive or legislative pressure. My concern is that the only thing we know is that the merger is supposed to do a number of things that look as though they are intended to increase the influence of Cabinet and of the executive over the court system.

One of the purpose statements the Minister made was: “better align the administration of the justice system with policy advice on the overall development of the New Zealand legal system”. I could spend time deriding the empty-jargon sound of that, because there must be better ways of stating what was intended. What does “better align” mean? Does it mean “bring together”? How will we preserve the independence of the courts? There is nothing in this bill that does that. What does “improve connections between research policy and practice” mean? Does the “practice of the courts” mean practice in a timetabling sense, or is it “practice” in terms of getting the outcomes that a Government would want, in the efficiency of handling appeals, or in terms of appointments? There is no detail, and this matter is not trivial.

The Minister’s statement, as I have mentioned before, stated: “enable better coordination of the relationship between the executive and judiciary”. What sort of relationship is a healthy one in a country with our kind of traditional relationship between the executive and the judiciary? It is very well established by convention that the relationship should be at arm’s length and very carefully handled. But there is nothing in here that says that the Minister has given any attention to those constitutional conventions.

The statement goes on to state: “reduce fragmentation by combining two agencies in one, and be manageable in terms of risk”. I believe that the Minister owes it to the Committee, and to the “sector”, as it is so often called in the jargon of these kinds of announcements, to explain just what needs better alignment, and what protections there will be in that alignment against the court system being at least perceived to be, and possibly being in reality, subordinated to the wishes of an executive that is obviously contemptuous of some of the conventions.

The Secretary for Justice was not able to help. When asked about just exactly what the “alignment” and “coordination” was to be, she said both organisations in question required more staff, and the main cultural difference is that the ministry is more policy focused. Of course, that is exactly what the Ministry of Justice was supposed to be—that is, policy focused—and the Department for Courts was supposed to be justice focused. But the secretary told us the biggest driver behind the merger was to bring the courts closer to policy development. Does that mean the courts will be developing policy that this Government could never get through Parliament? Does that mean that the Minister of State Services wants to see more of the kind of decision that the Court of Appeal has just made, whereby a major policy implication of the Treaty of Waitangi, a major policy in terms of ownership of and access to beaches and the foreshore, is made by the courts in a way that would never have been voted for by this Parliament, and is made by judges who are not able to be recalled by the people? Is that what is intended by this change?

I move, That the question be now put.

I would like to raise one of the points in the Public Service Association submission that the Hon Trevor Mallard referred to. It states: “Many aspects of the amendment are based on principles that the PSA has negotiated in management of change clauses in collective contracts and agreements.” The Hon Steve Maharey said the association could not do that. Obviously, it is doing that, because it has said so in its submission. No wonder I came up with the title: “Ill-conceived State Sector Amendment Bill”, because, clearly, there is some confusion on the part of the Minister as to what prevails and what does not.

In looking at Part 2, I have to raise again concerns about the obvious lack of cognisance of Legislative Change: Guidelines on Process and Content. The Minister, in that document, is clearly identified as being the person responsible for this legislation, and therefore he is responsible for the appalling state of it. He is also responsible for Supplementary Order Paper 107, which has come in at the eleventh hour from a Government that has no hesitation in putting a requirement for consultation in all its legislation—and going way, way over the top in the Local Government Act—but has not bothered to consult on this Supplementary Order Paper.

The Supplementary Order Paper has not been referred to the Government Administration committee, and, in my view, that is a complete miscarriage of justice. Some significant concerns have been expressed by the New Zealand Law Society. When one considers that the Crown not only is promoting the legislation but also will be the contractual beneficiary of it, and that there is not any select committee process for this Supplementary Order Paper, which is a substantive change, one realises that there is an absolute miscarriage of justice. There is no commentary, nothing. There is no opportunity to have legal involvement in determining the efficacy of this legislation, especially in the light of the guidelines on legislative change. If I were assessing this Supplementary Order Paper against the guidelines on legislative change, this Supplementary Order Paper would not be happening. Anyone in his or her right mind would not support this Supplementary Order Paper—which, in effect, is the bill—which has been put forward by the Hon Trevor Mallard. I keep tending to forget that name; I wonder why.

Consultation is such a biggie with this Government. Government members have put huge costs on local authorities by including a raft of consultative processes within the Local Government Act, yet they cannot even adhere to that principle themselves in the introduction of a major Supplementary Order Paper. It is not having any consultative process attached to it. That is a miscarriage of justice.

Those members are laughing about that. They do not care. They are saying: “We’ll stick it on the public.” They have put in the Local Government Act a requirement to consult. In the Land Transport Management Bill there are about five or six clauses on consultative requirements for Māori alone. Those members love that. They will put that cost on every Joe Bloggs out there, through his or her rates, or through petrol taxes or whatever, but they will not apply that process to themselves. They want this measure, so they say: “Stuff the consultative process!”. That is what those members are saying. They are not going to bother. “Why should we?” is what Labour members are saying; “Why should we care what the people think? This is what we want. We want to change round all these departments as we see fit.” They do not want to go back to the public and be publicly accountable for what they are doing. Goodness me, no! That is why they are going to shove through this Supplementary Order Paper—which is just about the whole bill—and to hang with any requirement to consult the public. Those members are not interested in public opinion.

We have a Government that is going to do what it wants at all costs, and to hang with the consequences. Who will pay? It will be the people of New Zealand who pay, and they will pay in a whole raft of ways. This lack of consultation is typical.

I move, That the question be now put.

Madam Chair, I appreciate your allowing us to express our concern. I had almost completed asking the Minister of State Services in general terms to explain just what is behind Supplementary Order Paper 107, or the merger of the Department for Courts and the Ministry of Justice. I realise that he may not have been prepared for that, but he does have officials with him. It may well be that the merger is something that he has not been directly on top of, and that the reasons for it are not his responsibility, but this Committee is entitled to know just what arrangements are going to be made, given that the Ministry of Justice now also includes functions that were previously with the Department of the Prime Minister and Cabinet.

The Ministry of Justice now has operational functions that some people might have thought were policing functions. There are crime minimisation, or crime reduction, functions. There is coordination work that involves the Youth Courts, the Department of Child, Youth and Family Services, and caseworkers. According to what we have been told, it involves pilot programmes in a number of places that involve the police, and those are, at the very least, constitutionally awkward if they fit within the same administration, without any kind of Chinese wall or any kind of information barrier, as the courts. When our courts are administered as an undivided part of a Ministry of Justice that has functions that come very close to policing, we have the sorts of concerns that at this very time have led the British to go to all the trouble of abolishing the role of Lord Chancellor and moving the House of Lords out of the legislature.

These are not light issues. Countries that take human rights seriously, that worry about the risk of well-meant structures being abused in times of stress, do not simply abolish a department of courts, and merge it with a ministry of justice, at the same time as they are dumping their top court, sacking their top judges, and replacing them with a new set of judges with, at the moment, unknown characteristics and conventions. This Supplementary Order Paper treats this merger as though it were a simple matter of substituting some words for others; substituting references to the Department for Courts with references to the Ministry of Justice. I say to the Minister that that may be easy to draft, and it may be that it is administratively convenient, but, at the very least, there should have been a paper that told us just how the Government will go about preserving not only the substance of independence of the judiciary but also the appearance of it.

I say to the Minister that we need to know that someone has given that some thought. There is no evidence in any document available to New Zealanders that it has even been thought material. For example, will the judges be able to have enough authority to discipline, or to appoint and change, court registrars? Will the judges have any control over court records and the integrity with which they are kept? Will the judges be able to dictate, as they should, the systems that will maintain confidentiality of papers and records that they believe ought to be maintained in confidence? Will the judges be able to ensure that the treatment of witnesses is consistent with respect for justice that is unbiased and not influenced in the direction of the executive and the wishes of the Government of the time? None of this has been addressed in anything that this Government has stated or explained about this merger.

Under the theory that set up the Ministry of Justice as a policy ministry, separated out the operational arms, and set up the Department for Courts, the courts were recognised as having a particular constitutional sensitivity. All of that sensitivity at the time that the department was set up has just been ignored, and, as far as I can tell, the Supplementary Order Paper is seen as the only thing that the Government needs to do to set this off—a Supplementary Order Paper that simply adds the merger of the Department for Courts to provisions that previously referred to a merger of two departments of social work.

I move, That the question be now put.