Wilkinson Kate: Crown Entities Reform Bill — Second Reading 
Text is incorporated into the Bound Volume 
Wilkinson Kate: Crown Entities Reform Bill — Second Reading 
[Sitting date: 22 May 2012. Volume:680;Page:2240. Text is incorporated into the Bound Volume.] 
Hon KATE WILKINSON (Minister of Conservation) 
on behalf of the Minister of State Services: I move  
That the Crown Entities Reform Bill be now read a second time 
. I would like to thank members of the Government Administration Committee for their prompt consideration of this bill. The bill is an omnibus bill that seeks to make changes to machinery of government arrangements in the health and charitable sectors. The proposals contained in the bill which I will now briefly recap are designed to reduce State sector fragmentation bring together complementary functions and expertise and create efficiencies by having stand-alone functions carried out by larger more resilient agencies.  
The bill provides for the following structural changes. Part 1 establishes as a Crown agent a new Health Promotion Agency to carry out the health promotion functions currently being carried out by a number of agencies across the health sector. The bill disestablishes the Alcohol Advisory Council of New Zealand (ALAC) and the Health Sponsorship Council and transfers their functions to the new Health Promotion Agency. It is also intended that the new agency will carry out other health promotion work including programmes currently delivered by the Ministry of Health. Part 1 also disestablishes the Crown Health Financing Agency. It is intended that some of the agency’s present functions will transfer to the Ministry of Health while others will continue to be carried out by Treasury’s New Zealand Debt Management Office.  
Part 2 brings forward the disestablishment date for the Mental Health Commission to 30 June 2012 superseding the current date of 5 p.m. on 31 August 2015. Part 2 also establishes a new Mental Health Commissioner as a deputy commissioner to the Health and Disability Commissioner and gives the Health and Disability Commissioner the new functions of monitoring addiction services and mental health services and advocating for improvements to those services.  
Part 3 disestablishes the Charities Commission and transfers its functions duties and powers to the Department of Internal Affairs except for decisions on the registration and deregistration of charities. The bill assigns these decisions to an independent board of three persons which will be supported by the Department of Internal Affairs. This independent board may make registration decisions itself or delegate responsibility for them in whole or part to the Chief Executive of the Department of Internal Affairs. However if the board chooses to so delegate the chief executive will also not be responsible to the Minister for registration decisions but must act independently.  
The select committee process showed a high level of support amongst submitters for some aspects of the bill particularly the establishment of the Health Promotion Agency and also some concerns about the implementation of the changes to the Mental Health Commission and the Charities Commission. I will address these concerns during the course of this speech.  
The bill’s intention with the Health Promotion Agency is to create an agency that is viable in the long term resilient and able to deliver better public health outcomes. It will lead to greater integration of health promotion across a range of public health issues encompassing not just the work currently carried out by ALAC and the Health Sponsorship Council but other health promotion work as well. There are significant opportunities to improve the delivery of health promotion programmes. These include taking advantage of shared expertise when developing or delivering programmes and reflecting the fact that a number of health promotion programmes focus on the same individuals communities or groups. The bill was intentionally drafted to reflect the Ottawa Charter recognising that effective health promotion relies on multiple agencies carrying out complementary functions. The Health Promotion Agency will be able to draw upon wider expertise utilise a fuller range of existing relationships and lead the health sector on health promotion issues.  
The bill ensures that the Health Promotion Agency will continue to exercise ALAC’s current autonomous advisory functions because these are well established and have proven effective for alcohol matters. The bill also preserves ALAC’s current alcohol levy and ensures it will be spent only on the Health Promotion Agency’s alcohol-related activities.  
It is worth briefly setting out some of the history of the Mental Health Commission. The commission was always intended to have a limited lifespan. There is a section in the Mental Health Commission Act 1998 that was to disestablish the commission at 5 p.m. on 31 August 2015. This bill brings forward the commission’s disestablishment date to 1 July this year. Originally the Mental Health Commission was established in response to the Mason inquiry of 1996. It worked as a committee for 2 years and then was established as a Crown entity in 1998 with a sunset clause that would disestablish it after 3 years. That date for disestablishment was extended in 2000 in 2004 and again in 2007. The time has come to stop the uncertainty created by these continuous extensions. By transferring the Mental Health Commission’s functions to the Office of the Health and Disability Commissioner and creating the office of the Mental Health Commissioner within that agency we will secure a permanent home for the functions in an independent resilient and well-established Crown entity.  
There was some concern amongst submitters that transferring the Mental Health Commission’s functions to the Office of the Health and Disability Commissioner would compromise the independence of the functions and the commission’s current focus on mental health advocacy and monitoring. However the functions’ independence from the Crown will in fact be increased. This is because the Office of the Health and Disability Commissioner is an independent Crown entity unlike the current Mental Health Commission which is an autonomous Crown entity. The bill also specifically provides for a Mental Health Commissioner who will function as a deputy commissioner within the Office of the Health and Disability Commissioner. This will be the only deputy commissioner specifically identified and provided for in the Health and Disability Commissioner Act 1994. This identification of the new Mental Health Commissioner in statute is intended to ensure that focus is maintained on the important mental health monitoring and advocacy work of the commissioner.  
Furthermore there are alignments between the new mental health functions and the current work of the Health and Disability Commissioner. The Office of the Health and Disability Commissioner has a well-known complaints resolution function but it also advocates for service improvement once problems have been brought to its attention. The Health and Disability Commissioner’s current service improvement activities align well with the new mental health monitoring and advocacy functions provided for in the bill. Transferring the Mental Health Commission’s mental health functions to the Office of the Health and Disability Commissioner will also provide the opportunity for efficiencies to be achieved by integrating back-office functions.  
In relation to the Charities Commission firstly some minor amendments to Part 3 of the bill are necessary as a consequence of the recently enacted Charities Amendment Act 2012. I propose to address these by way of a Supplementary Order Paper. There are three different issues that I will speak about in relation to the Charities Act amendments. They are the continued independence of the commission’s functions of registration and deregistration of charities the continuation of the commission’s education function and the request to delay this process until after the review of the Charities Act is complete.  
The bill provides for an independent board of three members to make registration and deregistration decisions. The bill has been carefully drafted to ensure the continued independence of this board when exercising its professional judgment on registration and deregistration decisions. The Minister will not be able to direct the board. Likewise if the board chooses to delegate some or all of its functions to the Chief Executive of the Department of Internal Affairs then the chief executive will also not be responsible to the Minister for registration and deregistration decisions but will have to act independently. The board will be statutorily independent from the Crown but will be supported by the Department of Internal Affairs. The bill therefore strikes an appropriate balance between important independence considerations and achieving administrative efficiency.  
The Department of Internal Affairs has extensive experience in supporting independent boards and offices of the kind provided for in the bill. These include the Gambling Commission the Local Government Commission the Registrar-General of Births Deaths and Marriages and the Chief Archivist. To take the example of the Gambling Commission it has been successfully supported by the Department of Internal Affairs since 2003 and has demonstrated its independence on numerous occasions by overturning Department of Internal Affairs decisions. I expect the board established by this bill to operate just as successfully as the Gambling Commission and any of the other independent entities supported by the Department of Internal Affairs for that matter in terms of exercising its statutory independence.  
The bill elevates the Charities Commission’s current functions of promoting public trust and confidence and encouraging and promoting the effective use of charitable resources to the Charities Act’s purpose section. This is a clear and explicit statement on the continued importance of the charities’ education functions. The bill also retains all the Charities Commission’s other education functions: issuing guidance and rules providing information to charities about their rights duties and obligations under the Charities Act and stimulating and promoting research into charities matters. The Department of Internal Affairs will be accountable to the House for the performance of these functions as normal. It is intended that these measures will help ensure the long-term viability of the charities functions and make them better equipped to respond to challenging financial circumstances than they would be in a stand-alone agency. It is precisely these considerations that have driven the Government’s approach when developing the changes proposed in this bill. This is a good bill and I commend it to the House.