Prasad Rajen: State Sector and Public Finance Reform Bill — In CommitteeText is incorporated into the Bound VolumePrasad Rajen: State Sector and Public Finance Reform Bill — In Committee[Sitting date: 02 July 2013. Volume:691;Page:11674. Text is incorporated into the Bound Volume.]Dr RAJEN PRASAD (Labour):There you go. Thank you very much. You cannot pull rank all the time. That is great Mr Chairman.I am pleased to take a call on Part 3 of the State Sector and Public Finance Reform Bill. I want to refer to a number of the provisions here. I will put them in the context of the independent Crown entities and the autonomous ones in the advocacy area if you like: the Human Rights Commission the Privacy Commissioner the Children’s Commissioner and the Families Commission. That is the context in which I want to make my comments.Clearly these provisions in Part 3 around Crown entities begin to codify a number of the aspects of Crown entities’ practice and particularly in relationship to their purchasing ministry and the Minister. It is codifying. A lot of this is happening already and here it is now translating into legislation. Many of these changes started my recollection is around 2004 and it is now that we are seeing them coming through in legislation. Some of them are tried and true.But along the same lines as my colleague Jacinda Ardern who just sat down I will talk about clause 162. These are the directions to support a whole-of-Government approach that is possible. My colleague took the line that two Ministers now have the ability to direct in any number of different ways. I agree with those kinds of comments. But in section 107(1) as amended by clause 162(1) paragraphs (a) to (e) in themselves are actually quite broad. We do not have an idea as to what the limits are of some of these directions. Look at the first one in clause 162(1) section 107(1)(a). We can direct independent Crown entities for example “to improve (directly or indirectly) public services:”. That could be anything. There are no limits to what is being suggested here. Indeed Crown entities generally in terms of the delivery of public services cannot be directed as such and many Crown entities actually do not offer a public service in terms of the traditional sense. I wondered what the limitations there were.The second purpose is “to secure economies or efficiencies:”. That also is so broad. Will the two Ministers be able to take under this provision very specific directions on how an independent Crown entity might want to use its resources for structuring itself? I see some difficulties and some dangers here.Some of the others are so self-evident it is difficult to understand why they are being included here. The third purpose is “to develop expertise and capability”. It is self-evident that Crown entities Government departments and ministries will develop expertise and capability. In fact that is why they are appointed but here is the ability to give another direction. Does the Minister have some other ideas in mind about these directions?Without any qualifications from paragraphs (a) to (e) on those kinds of provisions I see some difficulties some dangers probably and some difficulties in the future if these provisions were going to be relied upon by a Minister to instruct a Crown entity to do or not to do certain things. Therefore I see some difficulties in that particular area.Moving on to the provisions of clause 164 here we have again codified procedures for ministerial directions on Government policy. Ministers under the present Crown Entities Act have the ability to direct. Indeed there is quite a well set out series of steps in the Crown Entities Act on what the procedures are if the Minister intends to direct and then how it is to be reported to the House or gazetted. Some of that is being restated here again.I can see how officials have worked on this as a provision but there is another parallel track that operates and this is the very subtle almost surreptitious way in which currently Ministers direct Crown entities. If we take for example the Families Commission here over a period of the last 4½ or almost 5 years the Minister has been directing that commission and reshaping it in a very different way. Much of that is byway of “direction”—in quotes. Yet nothing has been gazetted about what those directions are. There is a bill before the House at the moment where all of that comes together. But the Minister has shaped it by the appointment of the chief commissioner. The Minister has shaped it by the appointment of other commissioners and putting in the kinds of commissioners who have been put in there in probably not so subtle ways has begun to shape that particular Crown entity and indeed others.So although the provisions here are clear and precise and I support them I would expect the Minister to actually follow this and not go along the parallel track that currently is in vogue which is the surreptitious and subtle shaping of the role and activities of Crown entities. I hope the Crown entities will rely upon this much more than the Ministers might to say: “Well if you’re going to direct me there are particular ways in which you might need to do certain things.” according to the provisions of section 115(3A) amended by clause 164.Then section 115 and subsequent sections begin to talk about the review of those directions. Quite interestingly the Crown entities I have been talking about in the advocacy area in the rights area have rarely received a direction from the Minister and the subtle ones have never been reviewed. I know that for a fact. What is the Government contemplating here? What is being signalled here? How can you review something that in a sense you have rarely if ever used on these particular entities that I am talking about?Then under section 115A(3)(b) in clause 165 if there is to be a review the expectation here is that there will be consultation with key people outside. I hope that the Government intends to follow those because in many of the changes it has made to Crown entities particularly to the Families Commission there has been no consultation with the stakeholders outside and yet they have been restructured and reorientated in quite significant ways and they will be a shadow of what they were before if the bill currently before the House is passed.So both the codification of the opportunity to direct and the review of those directions and the time-limited nature of those directions are very good provisions. They are now here they are now codified and I encourage Crown entities to actually utilise them and Ministers to utilise them. I rather suspect that Ministers and heads of Crown entities in the human rights area and the rights and advocacy area will find this a very very useful and transparent process which is what is being talked about here rather than the underhand secretive almost surreptitious way in which some of those Crown entities have currently been shaped.I want to talk a little bit now about the provisions of clauses 168 and 169 about office holders in Crown entities. I am glad to see this particularly clause 168 because it was just a month or two ago that the Social Services Committee was doing the financial review of the Retirement Commissioner. It amazed me that this was actually there—that in answer to questions for written answer the Retirement Commissioner had refused to give information to the select committee saying that this was the privacy of contractors. It took a couple of goes going backwards and forwards to say: “Well hang on they are still working as public servants.” which is what is clarified in section 135(1A) inserted by clause 169. Those provisions are particularly useful and now make it very clear as to the kind of information that select committees can have on these Crown entities.I want to talk a little bit now about the obligations to prepare and report statements of intent. Again this is simply—