Cunliffe David: Standards and Accreditation Bill — In CommitteeText is incorporated into the Bound VolumeCunliffe David: Standards and Accreditation Bill — In Committee[Sitting date: 01 July 2015. Volume:706;Page:5037. Text is incorporated into the Bound Volume.]Hon DAVID CUNLIFFE (Labour—New Lynn): May I begin my contribution by picking up where our chief whip has left off? As chair of the Regulations Review Committee I too would seek an explanation from the Minister about why the Government has introduced a part as sweeping as clause 39.Let me read it again: “The Governor-General may by Order in Council”—which of course is dictated by Cabinet—“make regulations providing for any matter that is contemplated by this Act as necessary—(a) for giving it full effect; or (b) for its administration.” So the regulation-making power is very very broad. It allows essentially the Governor-General on advice from Cabinet to make regulations. That means basically that the Minister is ordering up regulations as the Chair knows on any matter that the Minister sees fit.I turn then to a partner provision under clause 7 of schedule 1 of the bill entitled “Removal of Board members” which provides that “The Minister may at any time remove a member of the Board from office.” by written notice and publishing in the Gazette. Once again it is an almost unfettered power by the Minister to remove any member of the independent standards board. How very interesting.Then I turn to the regulatory impact statement prepared by the Government—by Treasury and the Ministry of Business Innovation and Employment—and what I was curious about as a non-member of the Commerce Committee that considered the bill was the fact that the Labour Party had supported the bill’s referral to the select committee but on the weight of submissions received by the select committee we are changing our vote and are now opposing the bill. This I say for the benefit of people listening is quite unusual. Sometimes an Opposition will oppose a bill’s referral to a select committee and then be reassured on the points that are of concern and vote for a bill thereafter. It is more unusual for us to vote against a bill on the weight of submissions having got it to a select committee in the first place.So what is it that is the core problem with this? Well let us start with what the problem is that the legislative process is designed to solve because this reform programme has been under way since the current Government canned the previous Government’s 2008 reforms in 2012. That is a 3-year ride to get to the point where we are today. So the problem definition is at No. 1 that the current arrangements of an independent statutory board are too unwieldy and too expensive and one reading between the lines might add the phrase “too independent”.A range of options was considered for different aspects of this but the key conclusion is in paragraph 30 on page 6 of the regulatory impact statement which says: “One of the key issues identified was the sustainability”—they mean the financial stability—“of [Standards New Zealand]. MBIE”—that is the Government Ministry of Business Innovation and Employment reporting to Minister Joyce—“have considered the current funding model and consider that it remains appropriate”—here is the punch line—“where regulators and industry … are able to exercise choices about the use of Standards and … their development …”.So the Government’s officials and the businesses that are being regulated are able to exercise choices about what standards are developed and how. That way they can cut out the ones they do not want and get only the ones they do want and that will be cheaper because the body will be doing less. The way to ensure that is to insource Standards New Zealand executive and board within the Ministry of Business Innovation and Employment reporting to the Minister—the same Minister who can write any regulation he or she wants and sack any board member he or she wants under this bill. It is insourced within a Government ministry. Any pretence of independence upon which New Zealand’s international reputation for effectiveness in this area was built has gone out the window. Not surprisingly that is exactly what submitters have told the select committee.National has chosen to go for the Ministry of Business Innovation and Employment embedded option for regulation of standards against the run of the public comments supporting full operational independence. I will boil it down again. Under the guise of addressing issues of financial sustainability—i.e. can we pay for the thing on its current budget—the Government has sneaked through a Trojan horse which is to remove the statutory independence of the chief executive and the board to bring them under a Minister within a Government department where the Minister can write any regulation he or she chooses and can sack any board member upon notice. There is a line official within the Ministry of Business Innovation and Employment who has day-to-day operational responsibility for the development of standards.Well that has got to be a backwards step and that is exactly what the weight of submissions has said. They go on and on and on—the negative submissions criticising the Government for this Trojan horse move. They warn us that not only will it trash New Zealand’s international reputation in the standards area but it could lead to other countries perhaps developing countries with less robust systems of governance adopting the New Zealand model to their detriment—adopting the New Zealand model to their detriment. These are very disheartening words to hear. Why would the Minister why would the Government want to have more control direct control over standards? Well it is lovely to see the Minister entering the Chamber at this moment and I hope that he will take a call and address himself to that matter.Here is what the New Zealand Building Industry Federation—The CHAIRPERSON (Hon Chester Borrows): Come to Part 2.Hon DAVID CUNLIFFE: —said in direct relation Mr Chairperson to Part 2. It said: “Standard-setting should not be subject to direct political influence by the government of the day.” Part 2 contains the schedules which contain the ministerial regulation-making power and the “fire’em sack’em or back’em” power. A consumer representative on a wide variety of standards committees Patricia Cunniffe—no relation—said that she was completely unconvinced that the Ministry of Business Innovation and Employment embedded model was either viable or well functioning.And there were many many many more submissions in a similar vein. Diane Baguley a member of the joint Australia-New Zealand committee since 1995 one of the international leaders in this area criticised it for its lack of independence and robustness. Here is a Government that is making a name for the decline of standards: the decline of broadcasting standards the decline of expenditure efficiency standards the decline of swamp kauri standards—the decline of standards all around the country. Maybe there is no surprise that it would want to have a tamer more compliant more malleable more directable more sackable standards body than currently exists.Under the guise of financial stability here is a Trojan horse by which this Government—which is always going for the short-term high-control solution—is ebbing away our independent institutions; ebbing away corroding away our independent institutions. This is another step along a road vested in Part 2 of this bill which is leading to ultimately more risk more fragility and down the track greater costs because if we get standards wrong we increase our insurance premiums we increase health and safety problems and we may have inter-operability problems that become more pressing in an interconnected world.I see the Minister of Health opposite. The Minister well knows that New Zealand’s 22 district health boards find it difficult to talk to each other online because they do not have and have not had a common set of inter-operability standards. That is a living glowing example of the importance of standards. If we want to shift patient data from an operating theatre in Northland to the family GP in Southland oftentimes it is very difficult to do it because the standards are not as robust as they should be. If we had had more standards of mining regulation we might not have had Pike River. So there are many practical examples about why standards matter.The gist here in conclusion—I see you are leaning forward for your time button Mr Chair—is this. It is a matter of regret that we are insourcing the standards independence within the Ministry of Business Innovation and Employment. That is a backwards step.