State Sector and Crown Entities Reform Bill

Thank you, Mr Chair. Now, while we do remain broadly supportive of the bill, we’ve had concerns, which we’ve expressed through the appropriate debate parts this afternoon, particularly around the State sector or Crown entity CEO pay and employment terms and conditions—enough so that, perhaps, such a bland title as the State Sector and Crown Entities Reform Bill may not be the very best title. We’re concerned that this could potentially—not just potentially, actually. We’re concerned, because we haven’t got movement today on some of the provisions around what the commissioner can and can’t do—what they may have to give regard to, but no clear weightings and expectations, in the legislation at least—that this could have a very chilling effect, particularly on those Crown entities on which there have been past public pronouncements around this very area. The Superannuation Fund and ACC strike me as two particular ones. So perhaps we could call it the “Suppressing Crown CEO Salaries Reform Bill”, or the “State Services Commissioner Empire-building Bill”, or any such name like that—not as flippantly as it might sound, but actually because we’ve raised some questions on this side this afternoon which we are concerned haven’t been addressed by the Minister.

I do note that while it’s against Standing Orders to refer to the absence of any member in the Chamber, to my knowledge it is not against Standing Orders to refer to the absence of officials in the Chamber to advise the Minister in the committee of the whole House stage. So while I’m very mindful that the Chair might make a comment about the seriousness of a name change that I might suggest, I’ve only been a member here for four years, but I can’t really recall a committee stage where officials haven’t been present to provide advice to the Minister. I actually think that sends a signal to the committee—I’m a member of it, and it certainly sends a signal to me—that the Minister didn’t come to the committee today with any serious intent to debate the provisions. That is not meant to be unkind to the Minister, but it is reflected in the absence of officials to actually answer the questions, because he hasn’t answered the questions. He’s sought to deflect and dissemble and divert—

💬 Hon Grant Robertson: No, no, he has not. He has answered the questions.

—but he hasn’t actually answered—OK. Mr Robertson raises this, so if I may respond to that interjection, Mr Chair, I specifically asked a question about, in the legislation, what weightings would be applied to the criteria that the commissioner has to give regard to—

CHAIRPERSON (Adrian Rurawhe): Mr Hudson, we’re on clauses 1 and 2.

Yep, but the Minister did not answer that question.

CHAIRPERSON (Adrian Rurawhe): That’s already been accepted by the committee.

If the officials had been here, they could have answered that. So I don’t think it actually would be out of order to say that maybe we should rename the title of this bill, because perhaps the absence of those officials does indicate that this bill is all about suppressing the salaries of hard-working Crown entity CEOs, and perhaps, particularly, those that have enormous responsibilities for the well-being of New Zealanders. I particularly refer to the Superannuation Fund, with their $38 billion worth of assets, and ACC, who are able to wash their own face in terms of managing the risks and potential financial liabilities to ACC because of the nature of how they run their business, and particularly the investment arm of it. So we could, and should, perhaps, call this the “Suppression of Hard-working Crown Entity CEOs’ Salaries and Some Associated Inquiries Amendment Bill”.

The commencement date, I think, is interesting, because it’s not been explained. Normally commencement dates are a date, or “when it receives Royal assent”. It’s not been explained by the Minister, and I call upon him now to take the opportunity to explain: why is there a specified hard date in this legislation? (1), why doesn’t it come into effect as soon as it gets Royal assent? I think the draft Order Paper we saw for this week could see it pass its third reading tomorrow, so why is there no Royal assent element to the commencement date? Why that specific date? Why, in fact, does it not just come into effect for each Crown entity at the time they seek to make their next amendment to CEO salary and conditions, for this particular Part 1, or, indeed, when they next employ a CEO? The Minister might like to just, you know, elucidate on that. I’m sure he’d be keen to.

Thank you, Mr Chair. I will pick up the point that my colleague Brett Hudson was making around the commencement date, 31 October. Here we are on 12 September, and it’s only, what, six weeks away. It just seems like almost unseemly haste in the implementation of this bill. There are a number of steps that still have to come into force, so I’m sure the committee will be watching—oh, we still have to have the third reading. I suppose the Leader of the House will—there was time this morning, in fact, because the House rose an hour and 45 minutes before it was due to, and a couple of bills just slid off. The whip on that side of the House is called Ruth Dyson, so there we are. There was no Minister ready in the House to take a call, which is pretty outstanding work on behalf of the Government—just a shambolic state of affairs, because this morning could have been an opportunity to perhaps pop in another reading of this State Sector and Crown Entities Reform Bill, because the Government just seems to be so very keen to have this bill enacted with a lot of haste.

I think members on this side would have been quite prepared, since the Order Paper has moved around considerably. Not only last evening but today there has been considerable movement on the Order Paper, so I don’t see any reason why for this particular bill we couldn’t have had the committee stage this morning, after the grand mal which was the fault of the senior Government whip and the Ministers present in the House. But our whips, who are ever-vigilant, would have made it possible for us to deal with the committee stage of this bill. Of course, this morning was still yesterday, as members will recall, and so we could well have been on to the next reading of this bill, which would have suited the Government’s agenda. I don’t know why they didn’t think of that.

CHAIRPERSON (Adrian Rurawhe): This is not a general debate. This is a debate on clauses 1 and 2 of this bill.

Oh, thank you—thank you, Mr Chair. I do appreciate your guidance. So I just say, with regret: opportunity missed, and a shambolic morning on behalf of the Government.

We do need to be careful, in the passage of this bill and the provisions in this bill, that we don’t enable a witch-hunt on behalf of this Government for a couple of CEOs and their conditions and rates of pay. If we do see that, then our concerns on this side of the Chamber will be vindicated, but I sincerely hope that we do not. We also need to be mindful of Treasury advice, which said the Public Service agencies are very large organisations that control very large budgets and have a high degree of public visibility and ministerial accountability, and we need to make sure that in enacting this bill we recognise that potential CEOs of these large organisations are, in fact, competing against the private sector for top-quality candidates. I know that this Government wants to bring the top down and wants to sort of suppress the top. I understand that; I understand their philosophy. But we mustn’t—mustn’t—have a situation where good people are turned away from public sector service because of the enactment of the State Sector and Crown Entities Reform Bill and the dampening impact potentially it will have on CEOs’ salaries.

We have to recognise, and on this side of the Chamber we absolutely recognise, that for the important public sector work we need the best candidate possible, and if we can possibly take someone from the private sector and put them into a public sector role, then all power to them. Their experience, and the degree of responsibility they are going to have to show in that public sector role—the visibility they have to all New Zealanders and to the Government—are accounted for in their conditions of work and their remuneration. National does support this bill, but it has noted a number of concerns, and raises a flag to this Government that we will be watching how this bill is enacted.

There are three points that I would like to make in respect of Part 2 of this bill, and I want to particularly draw the Minister’s attention—

CHAIRPERSON (Adrian Rurawhe): We’re on clauses 1 and 2.

Oh, I’m sorry. My humble apologies to the Chair. I had to absent myself quickly from the Chamber—

💬 Hon Grant Robertson: It’s a shambles over there!

Mr Robertson, I’d be happy to provide an explanation of where I was.

💬 Hon Grant Robertson: I really don’t want to know.

Well, actually, I’ll tell you exactly what it was. The Minister in the chair, the Hon Chris Hipkins, has invited our side of the Chamber to engage on important issues around a major State sector reform. The State Services Commissioner said the only time that he could meet with me was this afternoon—at the same time as the Minister in the chair is wanting us to debate a State sector bill. Now, actually, it’s a bit like the fiasco that occurred over education. It actually does make it quite hard, but I’m only moaning about those matters because members opposite wanted to raise them.

In respect of the title and commencement of this bill, I am interested to know from the Minister why it is urgent for these new standards to apply. A question that I put to the Minister on the earlier parts was that we have this controversy raging around the appointment of the Chief Technology Officer—that has resulted in the resignation of a Minister. Now, here’s the really interesting part that’s relevant to this bill, and that is the open question that the Minister did not respond to on the debate on the earlier part, as to whether the new codes of conduct and ethics that are being applied will, in fact, apply to the Chief Technology Officer.

Now, given there is serious doubt—serious doubt—about whether the Chief Technology Officer will be appointed by 31 October or not, is the reason that the Government wants this bill coming into effect in relatively short notice—and that’s more than just a few weeks away—because the Government wants to install some ethics and some standards around the Chief Technology Officer, given that this is one of the more dodgy things that I think this Parliament has seen in some time around the extent of the public sector?

We know it’s a very unusual appointment. It’s unusual in the sense that, unlike an appointment of any of our major public servants, that’s managed by the State Services Commission, the Cabinet paper for the appointment of the Chief Technology Officer directly went around that process. So my question is: is the timing in the commencement clause, clause 2 in this bill, related to that? Or, if not, why is the Government so keen to get this provision in place? Could it be that there is some other thing going on? And I’d love the Minister in the chair to comment. Is there some inquiry under the Inquiries Act that the State Services Commissioner has got his eye on initiating, that there is an urgency with the deadline of 31 October—just six weeks away—when the Minister is wanting these additional powers to be able to bypass the Privacy Act around an issue of an inquiry?

💬 Hon Grant Robertson: We just want to help Simon Bridges with his inquiry.

We would just like—and I notice that Grant Robertson is intervening. I’d love to know as to whether there is some sort of inquiry—

💬 Hon Grant Robertson: There’s only one inquiry going on in this building—right over there.

—that the Government has in mind. I’d love to know from the member opposite: who is it? Mr Robertson has just asserted that it’s from over our side of the House. Does he have information on it? We know the Government knows. We know parts of the Government know. And why not just disclose that so that we can get through that?

💬 Hon Members: Ha, ha!

Members opposite think it’s quite funny. Actually, it goes to the heart of Government if the Speaker’s office or some other public servant has leaked that information, and I’d love to know. I’ll tell you something: I’m absolutely confident that it is not a member of our caucus team. We’ve not gone down the road of ripping our guts apart, as I saw with Grant Robertson when he knifed Andrew Little and when they knifed the other three Leaders of the Opposition. That’s not what we do on our side of the House.

I move, That the question be now put.