Cunliffe David: State Sector and Public Finance Reform Bill — In CommitteeText is incorporated into the Bound VolumeCunliffe David: State Sector and Public Finance Reform Bill — In Committee[Sitting date: 02 July 2013. Volume:691;Page:11666. Text is incorporated into the Bound Volume.]Hon DAVID CUNLIFFE (Labour—New Lynn):Tēnā koe Mr Chairman. It is delightful to see you at this hour of the morning which I think is still technically part of Tuesday but you are looking in pretty good shape. I am so pleased that you have mentioned the schedules because I am sure that they are going to excite a lot of attention from members on our side of the Chamber. Part 3 is a very important part of the State Sector and Public Finance Reform Bill and I hope that with your good grace Mr Chairperson we will have ample time to scrutinise its clauses because this is fundamental legislation. This might sound like housekeeping but believe me it is not. This is some of the core legislation that amends the Public Finance Act the State Sector Act the State-Owned Enterprises Act and other core Acts that actually determine the machinery of government so that when the Ministers of the day the Cabinet of the day pull the levers of power something happens and we can tell what happened. For that to occur we need to make sure that the rules of delegation of financial probity of accountability all are tight as a drum and work as they should.In the past one of the things that has happened is that in an effort to make sure that the Public Service and the public sector operate efficiently and accountably there has been a tendency for departments to work on an individual basis and for their differing views to ultimately be brought together around the Cabinet table if they have not been harmonised prior in a Cabinet committee. For many many years Governments of both sides have viewed that as an imperfect state of affairs. We look forward to hearing the Minister in the chair the Minister of Immigration with his long experience give the Committee the benefit of his views as to how this could be made to work better. But for members opposite the objectives set out in Part 3 of the bill are incontrovertible. That is that the Government should be able to issue whole-of-Government directions andemploy a range of new legislative powers set out in this part of the bill to require if persuasion has not already done it Government agencies to work together for a common cause.It might be for example—let us think of a random example—border security requiring immigration and customs to cooperate by data sharing to pool their information to better identify risks coming across the border. A lot of that happens anyway. I do not wish to create any false impression. There is excellent cooperation between those two agencies but at the level of detail if necessary this part of this bill will give the Crown the authority to legally require cooperation between departments which is particularly important for enforcement agencies.Of course this is an interesting week to be discussing this bill because outside the Chamber in media-land public attention has been focused on cooperation between a number of other agencies some of which have been decidedly outside the law where some of our security agencies have been subcontracting to others without legal authority. There is now a desperate scramble by the Government to legalise activities that have hitherto by its own admission been outside the law in some 88 known cases. That is certainly something that neither side of the House could countenance. The question is whether the solution to that is actually to rein in some of those behaviours or otherwise to adjust the law to catch up with reality. The Labour Opposition believes that the rule of law should be paramount and that at no time should there be any actions outside the law but that is a debate for another day.The amendments to Part 3 are crucial. They are just aspects of the Crown Entities Act 2004 and they bring that alignment to bear not only on Government departments but on entities that are one step removed from departments—Crown entities. This is also an extremely interesting avenue for debate because there is a well-known and very visible oxymoron going on on the part of the National Government here. On the one hand it is passing this legislation which we heartily agree with that there should be ways of improving cooperation between core Crown agencies and Crown entities and getting Crown entities to work together and on the other hand it has embarked on a partial privatisation programme for the State-owned entities which will make it harder for the Crown to govern those State-owned enterprises as a portfolio and puts them further away from cooperative effort.The key example is the electricity system. We are an energy-dependent country. Right around the country New Zealanders are either shivering through the winter or facing bigger power bills and the Prime Minister thinks that that is just fine and dandy and that power prices are not too high. He thinks they are “about right” but New Zealanders know they are not about right at all. Power prices have been going up faster than wages faster than incomes and they are putting huge pressure on our families. Last weekend I was doorknocking in Upper Hutt and I had the privilege of meeting some families who are doing it tough in flats that looked more like dog kennels that leak that had mould growing up the walls that had children growing up in them with respiratory disease. Every time I go out doorknocking in areas of high deprivation I am shocked all over again by the way some people live. Why do I mention that? Because energy poverty is part of the bigger picture. Privatising our energy system as the Government is trying to do is going to be putting more pressure on family budgets because power prices are going to rise.What is the relevance to this bill? The relevance is very clear. In this bill the Government is trying to draw Crown entities into closer cooperation by requiring that cooperation through whole-of-Government directions. At the same time it is removing the existing power to direct State-owned enterprises the power companies currently residing in the State-Owned Enterprises Act and scrubbing that out because they willjust be publicly listed companies like any other in which the Crown happens to hold 51 percent. But there is no power to direct no no-surprises rule no portfolio synergies no sense of strategy—that will be the oxymoron at play. The Government is probably doing the right thing in this bill but it sure as heck is doing the wrong thing with the privatisation of State-owned enterprises.Broadening the grounds as this part does on which the Minister of Finance and the Minister of State Services can issue whole-of-Government directions and allowing those directions to be issued either to all departments or to a smaller group of entities including Crown entities presupposes a more important point a prior point: does the Government have a strategy upon which to direct? We have a Government here which at best resembles parts of the Holyoake Government of the 1960s—steady as she goes don’t fiddle with it she’ll be right. I have never seen four less effective more boring Budgets than the last four that Bill English has brought down. The bits that were not boring and meaningless were positively downright awful like giving huge fiscally negative tax breaks to rich people and putting GST up on everybody else. What has this Government actually done in the way of economic strategy other than making New Zealand’s incomes more unequal through the tax system and putting off paying for superannuation so our children face higher taxes?The Government wants to issue whole-of-Government directions. This part of this bill gives it the power to do so. We think that is a good thing. But in order to issue whole-of-Government directions it has got to have a direction to travel in in the first place and the problem with this good-for-nothing lackadaisical lazy useless National Government is that it would not know a direction if it tripped over it. Government members would not know a strategy if it bit them on the behind. They would not know an economic plan if it fell off the top of Steven Joyce’s glossy head. I have seen so many glossies out of “MoBIE Dick” the Ministry of Business Innovation and Employment that I am so sick of public relations spin rebranding and reissuing things that have been done since Adam was a cowboy. What I am still waiting for is a real plan that will grow jobs and incomes and employment and well-being. It is all very well in this part of this bill—Part 3 of the innocuous boring State Sector and Public Finance Reform Bill—to give themselves the power to issue whole-of-Government directions but there is no direction to issue because they have no idea what direction the country should be heading in.