Reserve Bank of New Zealand Bill

Members, we come now to the Reserve Bank of New Zealand Bill. First of all, to Part 1. This is the debate on clauses 3 to 7. The question is that Part 1 stand part.

Thank you, Mr Speaker. I’m looking forward to engaging with the Minister of Finance over this bill. It’s a very important bill, the Reserve Bank of New Zealand Bill. We’re talking about fundamental changes here, and there are a number of questions we’d like to ask him. I think the biggest issue about this bill is the issue about: what is the systemic failure that’s taken place for the Reserve Bank that actually requires these changes to the bank’s structure? We’ve already had one bill passed through this House a while ago and this is the second, and there’s another one to follow as well.

In the commentary here, it says the Government’s intention is “to modernise monetary and financial stability policy frameworks, [to] support good economic management and reflect the changing environment in which New Zealanders live and work.” So I think the first point is I’d like the Minister to explain why there’s such a radical need for a change and what has taken place that we can look at and consider. The public who might be tuning into this debate will say, “Well, why do we need to have more of these structural changes to the Reserve Bank?” So that’s probably the first question I’d like to put to the Minister, and hopefully there’s going to be a pretty interactive process, Minister.

Thank you, Madam Chair, and I thank the member for his question. Obviously, we’re looking here at Part 1, and in particular, I presume, the question relates primarily to the “Purposes” clause, clause 3. This is the third, as the member has indicated, in a trilogy of bills on the Reserve Bank. The first of those was the one that altered the objectives of monetary policy to include maximum sustainable employment and change the decision-making process for that to a committee-based process, in line with best practice around the world. These next two bills were also part of the review process, and I guess that’s my starting point to answer the member’s question—that after 30-odd years of operation of the Reserve Bank, we felt that it was timely to undertake a review. A lot has changed in monetary policy since that time.

When we come to the details on this bill, it’s particularly apposite for the role that the Reserve Bank plays in financial policy. If we do go back to 1989, when I was in the seventh form—Mr Bayly was no doubt, sort of, trekking around London bars or something like that at the time—the bank didn’t have the roles around financial policy and financial stability that it now has. As I’ve traversed in earlier readings of this bill, that role in financial policy, financial stability, has evolved in, really, an ad hoc way with different matters added to it.

So this second of the three bills is what we call the institutional bill. This is setting the Reserve Bank up to be a fit for purpose organisation for the jobs that we ask it to do, both in terms of monetary policy—and we’ve dealt with some of that in the first bill, but there’s a little bit in here—and then, in this bill, really particularly around that question of its role in terms of financial stability.

As part of that, the purposes of the Act then should reflect, effectively, modern best practice about how we describe what the role of the Reserve Bank Act is. So, obviously, in this case, it’s to provide for the continuation of what the bank does but also to “promote the prosperity and well-being of New Zealanders and contribute to a sustainable and productive economy.”, and here, what we’re getting right, in the right order, is the cascade of what we want. So this is the highest-level statement about what we want the bank to contribute to, and then we work through how it does that in the operative bits of the Act and also in other elements of what the bank does. So it’s prudential regulations or wherever else it might express what it wants—so it’s setting up a high-level purpose about the place of the Reserve Bank within that broader monetary and financial policy role that it plays.

The second thing I would say around the whole question of the timing is that when we went out to stakeholders—and we basically did three full rounds of consultation around these different changes we made—we did find most stakeholders were looking for ways of improving the operations of their interaction with the Reserve Bank, as well as more clarity about aspects of the role. Then, finally, thirdly, if we look again at that international best practice—in particular, the role of the board, which we’ll come to in Part 2 of the bill—it’s really important to make sure that we’ve got, effectively, a modern governance structure, and I think the board structure that we’re putting in place does that. So, effectively, it’s an exercise in modernisation, an exercise in clarity, and I think it’s one that will serve New Zealand well.

Thank you, Madam Speaker. Thank you for the commentary, Minister. So there hasn’t been any failure that we could look at? What the Minister’s saying is the Government has had a view that it just needs to modernise it after 30 years, but can he point to any systemic issues with the bank that we should have regard for? People listening to this debate might think, “Wow, this Reserve Bank hasn’t been operating well, and we need to set some real specific changes.”, because what I hear is an argument that, yes, we need to keep changing, but, actually, the Reserve Bank model adopted in New Zealand actually has been a framework that many central banks around the world have actually emulated and actually believe is a fantastic structure. So, again, just the same question: why?

By and large, I do think that the Reserve Bank Act has served New Zealand well. I think it’s really important to understand what this particular bill is about in the context of the other two bits of legislation, so I would regard both of them as being more operative, and go more to the question that the member has asked. In the case of the bill we’ve already passed, which is now within the Act, it was the fact that it is our view that the objectives that the bank had were too narrow in terms of just being about price stability, and, actually, we needed to look at maximum sustainable employment. We believe that was because, you know, we don’t make specific monetary policy decisions over here, but what we do do is set the framework for those decisions, and we felt, just as the United States Federal Reserve has, that a broader set of objectives was important. So that’s a change brought on by whether or not we thought it was operating in the best interests of New Zealanders.

The next bill that’s currently being drafted, and we’ve consulted on and announced the policy decisions on, is called the Deposit Takers Act. To give one example within that, we’re looking at the introduction of a deposit insurance scheme, which I do believe is a significant gap in New Zealand’s system—not having a deposit insurance scheme within the mandate of the Reserve Bank. So they’re examples for the member.

That’s not what this bill’s about. This bill is the institutional arrangements, and so it is by its very nature much more a modernisation exercise to help facilitate what would be the more systemic changes and issues that the member’s talking about. So we’re both—he and I—quite confined about what we can talk about, but I have given him that explanation by way of explaining why Part 1 of the bill does what it does.

OK, so I understand what he’s referring to. You gave us some examples, Minister, about operational changes, and I accept that, but the purpose of this bill is actually, to use your term, talking about institutional arrangements. So, again, I can understand why the Minister or the Government want to change some of the operational aspects, but what this bill is about is quite substantial governance arrangements, and that is the core question I’m trying to drive at. What has been the failure, or systemic failure even, at the Reserve Bank level that has led to poor policy outcomes or poor implementation that leads to a massive overhaul as set out in this bill?

I’m at risk of repeating myself here, but this is about making sure we have the best-practice, fit for purpose, modern form of governance for the bank. In 1989, decisions were made about having a single decision maker on virtually everything that the bank did. The member is correct in saying that other jurisdictions around the world looked at what we did and took many aspects of what we did, but you will struggle hard now to find anywhere in the world where a central bank operates entirely on that single decision maker model. So it’s a matter of the fact that in 30 years, the way we do this—the way we govern what we do—has changed. We’ve had significant experience in New Zealand through the Crown entities on how best to see a board like this run, and that’s what we’ll cover when we move into Part 2 of the bill.

We have made sure that it’s fit for purpose for the bank, and so therefore for the things like I know the member will raise around, for instance, the role of the governor on the board, it is different from Crown entities. That’s, I think, fair enough when you’re dealing with a particular institution, but we’ve certainly learnt a lot of lessons. So the member is fishing for some radical issue with the structure of the bank; that’s not the case. It’s about: here’s how we’ve changed the operations of the bank, and therefore here’s how we can change the structure to match those operations and modernise it, because a lot has happened in 30 years about the way that we run Crown entities.

Minister, I think we should accept tonight that these are new rules of Gotham City, or it feels like they’ve been constructed by yourself and Mr Shaw in your youthful days and now they’ve come to pass, and so, as I said the last time, maybe it’s the Sons of Anarchy—it’s following the trilogy. But let’s be honest and straight up about the fact that this is now going to give sweeping new powers to the bank and the Government.

I quote from Gareth Vaughan at interest.co.nz. He said, “the days of our idiosyncratic, light handed, financial regulator [are] numbered. The RBNZ is being moved into international regulatory [system].” That is one of the points that I think this bill is missing, which is the recognition that in 2017, one of the drivers of this reaction was the IMF assessment of New Zealand’s financial capabilities. So, five years on, it’s going to happen again, I guess, in terms of benchmarking, and I’d like to see somebody on the monetary policy committee apart from Mr Orr who can get up to speed with all of that and be found as a policy board member and actually execute that.

So I guess the point we’re making here is that in the next review we should actually recognise that on top of all of this is an international system that we’re abiding to. Maybe it’s worth contemplating that that in itself will provide some indicators around the capital framework, risk management, the nature of the board, and the nature of the Government’s mandate, and we think that the approach of least regret or wait and watch—the direction of travel can happen and change pretty quickly in this modern financial system. To all intents and purposes, the Government is providing an underwrite, and from my banking experience, whenever you underwrite something, you want to make sure that everybody knows what they’re up for and what they’re in for. We believe that the Reserve Bank has to have a policy committee that actually is up for that task, and in that sense, we agreed with the National Party in terms of some of its elements around efficiency in the nature of that relationship.

Let’s be really honest: again, there’ll be no more parliamentary oversight into the various elements of this bill, which will be a very strange departure, and how can we all be held accountable if we’re governing or we’re asked to vote on something that’s beyond our control? To me, I just feel and the ACT Party feel that this should have cross-party consensus. It doesn’t at the moment, but we’re not far away from that, with a couple of minor changes. The Government’s choosing to drive these reforms through without the support of the other side of the House, yet, we believe that that is an area that’s not as insurmountable as we expect.

One of the key things about the Reserve Bank—I remember the good old simple days when I only had a couple of things to do. They did lots of lunches and, you know, everybody talked a good game. But I actually don’t think, in ways, this bill is modern enough. I think we need to look at all the frameworks. I mean, if you look at it now, 85 percent of our banking system is owned by Australia; 60 percent of insurance is owned by the Australian companies as well, yet the Australian Prudential Regulation Authority as the regulator has a shadow presence when they come to review banks and financial institutions in this country, and we believe that should be tighter. We like the idea around the United Kingdom and what has happened there. So even though the instinct might be to drive this forward, I would like the Minister just to spend a bit of time on, really, the fact that we are in the international system now and what that means for this bill.

I thank the member Damien Smith for his comments and I do accept the point he’s making, which is that we are indeed part of an international system in the sense that we’re trying to apply a set of prudential rules that stand up to scrutiny internationally. I think his point around the role of the Australian Prudential Regulation Authority is an interesting one in that regard. It’s not the subject of the bill, but I’m happy to have it as a conversation with the member, because I think it’s incredibly important that New Zealand does set its own rules there for the operation of those entities in New Zealand. We try as much as we can to make sure they’re consistent with what happens in Australia, but our sovereignty around setting those rules is very significant and important, I think.

But in terms of his broader point, yep, he’s absolutely right. The IMF came here. They made a series of recommendations about what New Zealand needed to do to ensure that we were not only at best practice but in line with the various Basel Committee rulings. We have attempted to do that over a succession of changes, and the bank itself has attempted to do that over a succession of changes. That included elements of capital, as he mentioned, which are covered in one part of this bill and obviously in the bank’s work that it does with trading banks. Also, good forms of decision making and the kind of governance that would be expected were part of that as well. So, absolutely, it is an attempt to do that.

Where I would differ from the member is in his description around what this means in terms of how the bank operates and its transparency and so on. The balance we have tried to strike here and in every bit of our reform of the Reserve Bank is to maintain the operational independence of the Reserve Bank. That remains a very important principle to me. What we, however, have got from feedback as we’ve gone out and done our consultation is the importance of us setting out clearly our expectations, our criteria, and our parameters as a Government, and that’s what we’ve done. So we’ve got the monetary policy remit, the financial policy remit that is in here as well, and the rules around the way in which the bank finances itself as well, or we finance the bank and it makes its decisions. We get to set the parameters; they get to decide on the actual operations. So that constant balance is the thing that we are trying to seek through the full suite of reforms, and I think, occasionally, that’s where some of the other amendments that Mr Bayly’s putting up, I think, just lose a bit of that balance when they do that.

Finally, I’d say, yeah, it would be ideal from my perspective if we could get cross-party support on this. We didn’t on the first of our reform bills. It may be that we don’t on this, but I do believe the direction of travel is right and I know that this is the result of extensive public consultation, and so I don’t feel that we’re somehow out on a limb in this piece of legislation. I think it’s important, it’s institutionally sound—this bill—and I do want to make sure that we continue to debate this bill. I think it’s fine in a purpose clause debate like this to have a slightly wider debate, but there are a lot of matters that are about the operation of the Reserve Bank that are either dealt with in other bits of legislation or which are simply not dealt with in this bit of legislation.

Thank you. So, just continuing with my discussion before, did the Reserve Bank come to you seeking the change, or was it something you responded to as a result of Treasury suggesting—

CHAIRPERSON (Hon Jacqui Dean): Order! Order! Not the Speaker.

Sorry. Did the Minister respond to requests from Treasury? That’s the first question I’d just like him to consider.

The second aspect is I think we’ve ended up with a structural change in this bill which is quite significant. As you quite rightly pointed out before, the last bill was around—now an Act—dealing with the issue of the monetary policy committee, which has the governor as the chair of that committee. What were the options around the change or alternative governance structures that could’ve been in place? Because what was presented in the bill was a certain outcome which has basically been followed through into this bill. But, for instance, if I put up another option, why didn’t—or did you consider—

CHAIRPERSON (Hon Jacqui Dean): Order!

Did the Minister consider that you might have established a financial policy committee to deal with the other aspects such as prudential policy, non-bank deposit takers, and insurers? What we’ve been presented with is that all those activities are now being handled by an executive board. So to what extent were other options canvassed and considered, and did you actually, particularly, have regard for that specific issue?

Just, again, conscious of making sure we debate the bill that’s in front of us, in terms of the broader reform process, we campaigned on it in 2017, so I’ll take responsibility/credit for that. When we got in, we worked through with both the Reserve Bank and Treasury the scope of that, we brought in an independent expert advisory panel, and then we launched into a very comprehensive consultation round, which we’ve now done three separate consultations on. As I said in my earlier intervention, the feedback we got as we did that was that people welcomed the opportunity to modernise and refine the bill, as is on the public record released in many, many documents through the proactive release process. On not every single issue was there unanimity between the bank, Treasury, and myself, or the expert advisory panel—that’s to be expected—but on the vast bulk of what we are putting through the House, we did have clear agreement from across those institutions about what should be done.

Yes, we did look at a range of options, and, again, they’re not covered in the bill, so I won’t go into detail on them, but they all are covered within the consultation process and the material that’s being released publicly. It is our view that in terms of the governance model we’ve chosen, this is a model that people will be familiar with in terms of Crown entities, with slight tweaks in order to acknowledge the particular role of the central bank, and, therefore, we think it is appropriate.

When it comes to the question around monetary policy and the way that is done, there is an absolute obligation, in my opinion, for us to uphold the principles of the Act around operational independence, and that’s what’s helped that decide. But, again, for the member’s benefit, those broader issues are not necessarily the ones in this bill, and particularly not the ones in Part 1.

Thank you, Madam Chair, and I appreciate the Minister’s response to all of the questions that have been put so far. There are plenty more.

But I do want to pick up on a point that the Minister made in respect of what he described as “the extensive public consultation” on the bill, and to the degree that there was a small number but very intelligent and thoughtful submissions on the bill, I would agree with him. The issue that I have and that I think is worth canvassing in Part 1 is the fact that after that consultation ended, there were changes that were made to this bill, not the least of which was fundamental to the Reserve Bank’s operation, and that’s to the governance structure. Now, it is mentioned in Part 1, and we’re going to elaborate on it more in Part 2 with the amendment in Part 1 to the preliminary provisions that changes the Governor of the Reserve Bank to be its chief executive to that which then says “and a member of the board;”. This is, to my mind, a quite fundamental change to the governance structure, and one which at the time the bill was introduced and was referred to the select committee was not being considered.

I note the officials’ departmental report to the committee dated 1 April was talking about this. There were two submissions that addressed this particular point, one from Michael Reddell and the other from Helen Dervan and Simon Jensen. They raised concerns, but not about that question.

I would also point out that while there were extensive submissions by the public, as it were, on the removal of the reference to efficiency—which is, I believe, in Part 1 of the existing bill and is now removed—that was not taken up. That has been of concern to National Party members, at least, to the degree that while there was extensive public submission, it didn’t really feel particularly listened to, and there were changes.

So my question, effectively, to the Minister is: did he consider that the changes that were made after the closure of the consideration of the submissions and the amendments that officials recommended to the committee—did he consider that there was merit in actually reopening submissions on at least the question of the governor on the board and some of the other changes, including to remits and so on, that had been recommended to the committee after the closure of submissions?

Just to go back to the beginning of the member’s contribution, I respect the fact that it’s an important part of the process that submissions came through the select committee process, but in the second consultation round, I think we had probably around 60 submissions, and in the third consultation round, around another 30. So I do just want to say that there’s been an awful lot done before we got to the committee.

Issues around the question of the role of the governor and him being on the board have been live discussions throughout the process. The decision was made—and this was an example in response to my comments that I made to Mr Bayly earlier—of where there were differing views amongst the stakeholders involved in this about exactly how this should work in terms of the governor, and the judgment that we made was that given the very particular role of the governor, it is best that they were represented on the board. That is also the position in a number of other central banks as well, and it’s largely to do with the coordination of monetary and financial policy and the fact that the governor still occupies a very unique role. Even though we’ve now moved to the position of a committee-based structure for monetary policy, the governor can provide that level of coordination between financial policy and monetary policy that makes him an appropriate member of the board.

There are—and we will come to this, Madam Chair, in the relevant operative part—in Part 2 a number of mitigations around that for matters to which the governor is not to be a party to, including his own role within the bank, and he would not be part of those decisions within the board’s normal decision-making framework. So our view is that that was important.

The second matter the member raised in his call was the question around efficiency and the place of efficiency. I covered this in one of my earlier responses to Mr Bayly, which was that when we are setting as a cascade, we set the high-level objectives. It’s important that we’re clear about what the primary objectives are. Efficiency then plays its part throughout each of the activities the bank undertakes and in each of the regulatory measures that we might choose, or, indeed, other Acts of Parliament, including the prudential supervisor’s work and so on. That’s where you’ll see it.

So it’s a debatable matter, and I’m not ignoring the fact that some submitters wanted to keep it. Other submitters were comfortable with where it ended up.

Just a quick question to the Minister of Finance. Does he believe that changing the bank’s reporting requirements enables him to manage the fiscal risk associated with the Crown when the Reserve Bank’s activities are at arm’s length and independent, or does it fall short of what you require to manage the Crown’s financial position, considering we’re underwriting, as a nation, their activities?

I think New Zealand has the particular set of circumstances where the Reserve Bank is part of the Crown’s overall balance sheet. That’s not the case in a number of other jurisdictions. As a result, we have to find a way of getting that balance of operating independence versus the point that the member’s raising. That’s done in this bill, albeit not in this part, by us setting the financial parameters and then operational decisions within that being made by the bank itself. To me, that is a necessary compromise in order to protect the operational independence of the bank.

I think if the Minister was able to too tightly control how the bank used its money, that could undermine its position. It is important that we have transparency about that—and we’ll come to this later—but that actually means that that will now be tabled in Parliament, the way in which we do that. I think that’s a useful step forward. It will enable more people to see it. We used to just do it after the fact, essentially; now it’ll come here and be tabled. So that will give all members of the House some opportunity to see that, but, again, to me it’s striking that balance between operational independence and us setting frameworks and parameters. We’re at risk of me saying that a lot in the next few parts of this bill.

Thank you. I just want to refer to Mr Smith’s earlier contribution, which is the substantive issue. Obviously, with this bill the Minister and the Government’s trying to set in place a new framework that, hopefully, will last for another 30 years. Given that it’s inevitable there will be a change of Government and the need to make sure that we put in place a framework that is enduring, can I ask, during the process that the Minister outlined just before, why did he not choose to involve members from the Opposition in that process at an early stage to ensure that we do actually come up with an enduring solution for an institution that I would suggest to the Minister is not equivalent to a Crown entity? It’s probably our most pre-eminent financial institution, and therefore vitally important for all of New Zealand that we get the framework absolutely correct.

A couple of points. The first of those is, clearly, it was open to the members opposite to be involved at any stage of this process, should they have chosen to be, but, clearly, the select committee is the process where they’re mostly involved.

Secondly, with respect to the member, I think by and large there is agreement. He’s got half a dozen Supplementary Order Papers that he’s put up, which is absolutely in his power, but, actually, I think, generally speaking, the agreement is across the House on the way we want the operational independence to work, the way that we want to make sure that there’s clear lines of decision making and accountability, and that there are clear documents that show that, be it the monetary policy remit, the financial policy remit, or anything else that we might decide in the future. So I think this is an enduring piece of legislation, and I want to be really clear that the basis of the governance model is the Crown entity model, but it has been tweaked to acknowledge the specifics of the work that a central bank does and that the Reserve Bank does. So I’m very confident that we’ve got robust legislation and we’re making it more robust after this bill tonight.

I want to draw the committee’s attention to the purpose statement for this bill, which is set out in this Part 1, which says, very clearly, that the purpose of the Reserve Bank bill is to “promote the prosperity and well-being of New Zealanders and contribute to a sustainable and productive economy.” In that context, I want to ask the Minister to what extent he directed his officials, or he himself considered how well the objectives set out in this bill actually marry up with that purpose statement. The context for my question, of course, is that we have seen very clearly in the past 12 months the impact the Reserve Bank’s actions and its monetary policy remit can have on the prosperity and wellbeing of New Zealanders. There are New Zealanders across the country who feel that their wellbeing and prosperity has been detrimentally impacted by soaring house prices, by asset price inflation, and by the bank’s own admission that its actions in relation to interest rate cuts have directly impacted on that and, therefore, have had potentially intergenerational impacts.

The reason this matters in terms of the objectives that are set is that the status quo for the Reserve Bank bill, as other members have outlined, is to very clearly set out that the bank must achieve and maintain financial stability of the financial system, but must also do so in way that is efficient and that maintains efficiency. That concept of efficiency is very relevant when we look to the purpose statement, because the interpretation of what economic efficiency is has long been understood to be a judgment and a balancing of what the costs and ramifications are of actions that the Reserve Bank may take within its financial stability mandate. So if we look, on the one hand, that the bank could do absolutely everything in its power to ensure financial stability, we must also consider the ramifications that would have for wellbeing and prosperity. It was the view of many submitters on this bill who we heard during the select committee process that the inclusion of the efficiency objective ensured some tension in those two things and ensured a better balancing of them, because, otherwise—now, without that efficiency constraint, the bank may take a “least regrets” approach in which it narrowly sees its objective in terms of financial stability.

I note that during the first round of consultation on this bill, this particular issue which I’m addressing now in relation to the purpose statement and the efficiency objective was something that around half of respondents supported retaining. The reasons for that that have been raised are about the fact that that efficiency inclusion actually leads the banks in the direction of minimising and justifying the regulatory burden that it puts in, and that potentially creates some constraint around its actions, as they relate to the distributional impacts, which have been large in recent months; as they relate to innovation and dynamism in the financial system and the need not to cramp on those too much.

So, as I said at the beginning of this contribution, I ask the Minister: to what extent that purpose statement was tested against the provisions of this bill to ensure that they are truly carrying out that purpose of ensuring the prosperity and wellbeing of all New Zealanders?

I thank the member for her contribution. I have covered the efficiency question in several of the earlier interventions. But to take a step back to answer her specific question, and, again, I had covered this as well, what we are trying to do here—and, again, this comes back to best practice internationally around regulators of setting high-level objectives, or a high-level purpose, which she has read out, and then the objectives: yes, they do support that. So the answer to the question is yes.

What this bill does, however, is actually give us far more tools to be able to ensure that that happens, and that, in particular, in this bill is the creation of a financial policy remit. Given the member’s interest and reference to the housing-related questions, that is now the extra tool that we have to actually drive outcomes that go to whatever a Government of the day may decide are the important matters that it wants to see dealt with in financial policy. Those will need to be ones that protect and promote the stability of New Zealand’s financial system as the objectives line out, but, actually, now having that remit is the tool that will be useful. The Government found itself in the position, in the absence of a remit, of needing to use section 68B of the Act to be able to, effectively, ask the Reserve Bank to take a matter into consideration. Now, we’re going to be able to connect the objectives and the purposes much more clearly there, in what we’ll do with the financial policy remit. So I think, actually, this bill does do the thing that the member is concerned about.

I would note that in the issue around efficiency, non-efficiency, and its importance, and whether or not it would play a role in that, there is sort of an internal contradiction there, which is that the problem the member has alluded to around the impacts of house price inflation and so on happened under the rules that we’ve had. So I don’t think it is a question of us removing that. I actually think we are strengthening our ability to have some influence over that, via the financial policy remit.

I move, That the question be now put.

💬 Andrew Bayly: Madam Speaker? Madam Speaker?

CHAIRPERSON (Hon Jacqui Dean): “Madam Chair”.

Madam Chair, sorry—yes, sorry, Madam Chair. I’m used to you sitting down here—

CHAIRPERSON (Hon Jacqui Dean): Me too.

—and I’m used to seeing the Minister beside you, but it’s a very unusual arrangement. But, of course, this is COVID, and that’s why.

I just want to respond in probably my last comment on this, but I just note the Minister’s comments before. If he believes that adequate consultation with the Opposition party is when a bill is introduced to the select committee and members of the Opposition propose a number of changes, very few of which have been picked up, and that is adequate consultation and that’s a way to get cross-party or cross-House support, I’m just putting on record that I think that it’s actually a very disappointing approach.

The potential that this will give rise to is that we do have some Supplementary Order Papers (SOPs) and we do feel deeply about them. We think they’re quite significant, we’re not putting up frivolous SOPs, and I think that gives rise to the potential that the Reserve Bank of New Zealand Act will need to be changed in the future. I think that’s something that’s very disappointing and something that’s actually a bit of a lost opportunity for Parliament, because, as I’ve said before, this is our pre-eminent financial institution and it’s absolutely essential that whoever is in Government has the right framework to make sure that this institution operates effectively in the best interests of all New Zealanders.

The question is that the Minister’s amendment to Part 1 set out on Supplementary Order Paper 44 be agreed to.