New Zealand Productivity Commission Act Repeal Bill

Members, we come now to Part 2. This is the debate on clauses 8 to 12, the “Disestablishment of New Zealand Productivity Commission”, and Schedule 2. The question is that Part 2 stand part.

Madam Chair, thank you for the call. It feels like only yesterday we were here discussing this bill. I wanted to lament the fact that we didn’t quite get to cover off clause 7, which was the self-repealing part of it.

💬 Hon Dr Duncan Webb: Wrong part.

I know. I’m lamenting the fact we weren’t able to cover that off. But we will move on to Part 2 and Schedule 2, which is, of course, the substantive part of the bill. The “Disestablishment of the New Zealand Productivity Commission” is the name of the part, and in terms of productivity, can I just give a nod to the Minister for Regulation, in clause 9, where the title of the clause is actually longer than the substantive part of the clause itself. Now, if that is not an example of productivity in legislating and drafting, I do not know what is. So I just wanted to commend the Minister and the drafters and everyone who worked on the bill for their efficiency and their productivity in putting that particular clause together.

Now, I do have a number of questions on this bill. Again, as we went through at length last night—and everyone was very enthusiastic late last night on this bill. But, of course, we do have clause 8, which is the repeal of the New Zealand Productivity Commission Act itself, and that is probably the most substantive part of the bill. That is the part which does all the heavy lifting. It repeals the Act, or it disestablishes the Productivity Commission. It’s the reason why we’re here today. It’s the reason why we are debating this valuable bill, which is part of the Government’s 100-day plan of action.

Now, I’d like to ask the Minister a question about clause 8, and I didn’t know whether it was appropriate to ask in the first part or to ask during the second reading, but—

💬 Hon Dr Duncan Webb: Speak slower.

Sorry, what was that, Dr Webb?

💬 Hon Dr Duncan Webb: Speak slower—it will take longer.

Oh, Dr Webb is instructing me to speak slower. I think that comes from Dr Webb’s years and years and years and years of experience of public speaking, speaking in front of crowds, lecturing at a fine university—Canterbury University. It’s not the best one in the South Island, but close to it—at least in the top two. So I will take the member’s instruction and advice and speak slightly more slowly for the benefit of the member, who may be getting slightly tired at this time of night.

Now, I did have a question for the Minister on clauses 8 to 10, and, of course, clause 10 is the residual assets clause of the bill. Essentially, what this clause does is it vests the residual assets, liabilities, agreements, and leases in the Crown as assets or liabilities in the ministry. I just wanted to ask the Minister what kind of robust discussions and debates he may have had with the finance Minister on this, because, of course, you’re looking at vesting liabilities and assets in the Crown. That’s got to go some way towards the cost savings that we’re trying to get out of the disestablishment—

💬 Hon David Seymour: That’s a second reading question, mate.

—of the Productivity Commission, and I’d like to ask him about that. It may be that these kinds of questions are something more appropriate for other parts and other stages of the House, but as we are here under a constrained sitting environment and we’re all new to the place, it would be great to get a little bit of generosity from the Chair when it comes to debating these kinds of bills.

So then we do have clause 10(2), which is about information held by the commission before it is disestablished also being transferred to the ministry, and there’d be some interesting questions there, I think, for the Minister around how does that work when we’re transferring information. I assume the normal privacy obligations apply when we’re going from a commission and transferring it to the ministry, which we talked about in the interpretation section—so just questions there about how does that work in terms of the privacy obligations of an organisation which is disestablished.

Information which is held and transferred—who has the obligations to notify anyone who holds personal information? Perhaps someone who’s had an interaction with the Productivity Commission in the past would like to make a personal information or a Privacy Act request. Who would they go to to ask that when the Productivity Commission is no longer with us, when it is passed by, and—

💬 Hon David Seymour: That would be a residual liability.

It may be a residual liability, and I would really enjoy the Minister’s contribution and thoughts on that. Thank you.

Thank you, Madam Chair. I think I can probably be a little more concise than the last speaker, James Meager. In clause 10(5), it talks about the completion of reports. Now, yesterday, the Minister for Regulation was very flattering of the work of the commission, and it’s pretty much obvious that there’s going to be a number of reports under way. The clause says that “the Ministry is not under any obligation to complete … reports”, but given that there will be reports in train, is it the case that the ministry will complete the work that the commission has under way?

Thank you, Madam Chair. I say to the member James Meager from the Government benches that I’m happy to answer any questions he has, but, in the meantime, he’d probably be better to go and knock on the office door of Simon Court and get some advice on how to filibuster imaginatively.

In response to Dr Duncan Webb, if he was listening yesterday, he would have heard me say in answer to, funnily enough, Simon Court’s question that we expect the commission to wind up on 29 February. If you may recall, I pointed out that that was an interesting point because it’s a leap year and that the report that’s outstanding would be completed by 15 February.

It’s a pleasure to rise and take a call in the second part of the New Zealand Productivity Commission Act Repeal Bill. I was listening from my office last night to this debate. It’s been great to hear some of the concerns that members have had and to hear that the Minister for Regulation reflects on past ACT positions and says that members should be willing to learn and grow from those past positions, and that is why we’re here today, to disestablish the Productivity Commission.

One of the questions that we heard last night and that we hear out there in the public domain—whether it’s on the blog sites or in the papers—is who will carry out the work of the Productivity Commission once it is disestablished, and so that is my question to the Minister today, which is to reassure the public that, actually, there is a huge body of independent organisations out there that will take up the mantle of the Productivity Commission, because we know it’s an important challenge this country faces. We know that since the 1960s, this country has had a lagging productivity growth rate compared to our international peers, which has led to the fact that any worker in New Zealand can go to Australia and earn, on average, 30 percent more income over there and that any worker can go to America and earn 35 percent more income in America. So that is, I think, a really important thing.

Here’s my reflection on that question, but I would like to hear the Minister’s reflections. It is that there are some fantastic organisations in New Zealand that do work on productivity: organisations like Motu, and I’d like to call out Phil McCann, an amazing professor who does work on the economic geography of this country, and who has done a huge amount of work to understand New Zealand’s geographical position and how it’s led to our low-productivity growth rates. There are places like the New Zealand Initiative: Oliver Hartwich and his team do a great job of understanding, particularly, the economic drivers around education, and financial markets as well. There are universities—and I’d like to call out my own professor, Tim Maloney from Auckland University of Technology and formerly from Auckland University, around labour economics, because, as we know, what drives productivity is finance, labour, and the meshing of those together. That’s called multi-factor productivity.

So that’s my question to the Minister. It is: who will take up the mantle of productivity in this country? There are other great organisations out there, organisations like the Treasury. The Treasury has done—

💬 Hon Dr Duncan Webb: Talk about the bill.

—in the past, some incredible work, and I’d encourage the member opposite to read the Treasury’s papers on productivity, because they are possibly even better than the Productivity Commission’s papers themselves.

There are international organisations—places like the World Bank, the OECD, and the IMF. These organisations do an incredible amount of research on New Zealand’s productivity challenge and what we need to do to resolve that.

So that is the question that I think some of the left-wing blog sites and some of the left-wing papers, and some of the questions that are lingering in the minds of the public that I think the Minister ought to potentially address. My reflection is that there is actually a huge amount of people out there and bodies of organisations that will take up the mantle, and this organisation, although they’ve done some important work, their kaupapa—which is around improving productivity and understanding the key policies that will help to improve productivity in this country—will actually be taken up and adopted and delivered by other important people and organisations in the country.

So that’s my question to the Minister. He may wish to not answer, but we’d like to hear his answer on that question.

💬 Stuart Smith: A substantive answer.

A substantive answer to Part 2. But I support this bill and I would like the Minister to address that question.

I wasn’t going to take a call on this part of this silly and sad piece of legislation, but I’ve been inspired by the contribution from the member Dab Bidois, who’s just resumed his seat. So my question on Part 2 is with respect to clause 9. It’s a relatively simple question for the Minister for Regulation, and that’s “Why?”, because this is an organisation that was created at the behest of the ACT Party and that the Minister, in his first and his second reading speeches last night, told us had done good and excellent work, and yet he brings a bill to the House to disestablish it.

I still haven’t had an answer from the Minister that satisfactorily answers why clause 9 exists, and I guess that there’s a subpart. If “Why?” is not a simple enough question for the Minister, there is a subpart to this, which is to ask the Minister what other options he might have considered. For example, if his concern was, as he has publicly stated in the media, that the Productivity Commission had gone off-piste from where ACT would like it to be—obviously, I disagree with the premise behind that. But if that is the Minister’s concern, why did he not reappoint people that he considered would bring the commission back to where he felt it should be?

As everybody has said in the House over the last night and tonight, productivity and the challenge to New Zealand on productivity is decades long, very complex, and something that we all agree we need to do more about, and having an organisation whose job it is to take the big-picture view and to produce the reports that we can learn from is, presumably, a good thing. The Hon James Shaw last night offered the Minister a couple of other ways and pathways that he might be able to do this, including changing the legislation around how the Government needs to respond to a report of the Productivity Commission, thinking again about the kinds of inquiries it can do, who it can work with and indeed, as I say, who is appointed as commissioners.

So it is a fairly simple question for me. This is an absurd piece of legislation, and the best we’ve been able to get—

💬 Carl Bates: That’s why we’re repealing it.

No, no, no, this—this—is an absurd piece of legislation, and it does strike me that the only credible thing that we’ve heard is that the Minister wants his vanity project with the ministry of regulation and the only way he could get that through was to sacrifice the Productivity Commission. If that is the case—and it does appear to be so—then that is why this is a very, very sad bill.

So that’s my quite simple question for the Minister. Why is clause 9 here, and what else did he consider that he could have done to achieve the goals he has whilst keeping in place a commission that works on the issue that virtually everyone in this House agrees we need to work on?

Thank you, Madam Chair. I want to just graft on to what was said there by the previous speaker, Grant Robertson, because I, years ago, worked for the Law Commission, which is an independent organisation, and those kinds of independent organisations are really rich in having a focus and a capacity for people to engage with them. We heard speakers yesterday talk about how people did engage in a different way with the Productivity Commission and they said that they could do a much longer-term piece of work and they could do a much more specialist piece of work. Now, I can see the Minister for Regulation raising his eyebrows at one of the organisations which I have great respect for—from what I can see—so I would like to know how he intends to continue that tradition of independence if, in fact, when people say things he doesn’t like to hear and that don’t go along with his ideology, he is prepared to dismantle them.

I would like to respond to some of the contributions. I would answer Dan Bidois’ question. However, he gave such a lengthy answer himself, it hardly seems necessary.

In response to Grant Robertson, clause 9 is there to give effect to the policies that were agreed on in Part 2, and, as he says, it’s a very simple clause. It says, “The Commission is disestablished.”, so he should be able to work that out. As for a number of other comments that he made, I could engage with him on that, but it doesn’t really seem worth it. I could make similar comments about some of the characterisation and attacks from Helen White, but I don’t think that’s really necessary.

I wonder if I might talk a little bit about this, because we know—and the Minister for Regulation has been quite clear—that the Productivity Commission will be replaced by a ministry which he will be in charge of in respect of regulation, which he thinks will have some impact on productivity. I wonder if he might comment on the suggestion that he would much prefer to have a ministry which he can direct, rather than an independent commission over which he can’t control the opinions of.

It’s on the record that Mr Seymour has said that the Productivity Commission, he thinks, has been hijacked, and he said that on 5 September 2023. So it strikes me, Minister, that the real reason you’re abolishing the commission is because you don’t like its independent views, and, what’s more, the chair of the commission—you were unkind enough to say that you would not have appointed him. You said that on the same date.

Now, the Hon Grant Robertson has already pointed out that it’s open to you to make your own appointments to the commission. But I would ask you to respond to the fact that what you want is a little department all of your own where you can make sure you can control the opinions that come out of it, rather than have a thoughtful and independent organisation which can give genuinely independent insight into productivity in New Zealand.