State Sector and Public Finance Reform Bill — First Reading 
Text is incorporated into the Bound Volume 
State Sector and Public Finance Reform Bill — First Reading 
[Sitting date: 29 November 2012. Volume:686;Page:6952. Text is incorporated into the Bound Volume.] 
State Sector and Public Finance Reform Bill 
First Reading 
Debate resumed from 28 November. 
Mr SPEAKER 
: Order! I ask members leaving the House please to do so a little more quietly. 
Hon TREVOR MALLARD (Labour—Hutt South) 
: 
 There are really a couple of points I want to make and I will make the first point briefly. I think the Finance and Expenditure Committee will have to look really carefully at the question of whether powers delegated to chief executives by this Parliament should in fact be sub-delegated to persons outside the Public Service. I think there is a clear implication there is a clear understanding that where statute has given a chief executive a particular power that can be delegated within the department but not to someone outside. 
The second and more important point that I want to make and make it by warning to Jonathan Coleman the Minister of State Services and the Leader of the House is to ensure that the Government does not intend to ride roughshod over the Standing Orders Committee. It is the role of this Parliament to set some rules for the department and for executives but it is not the role of statute law to organise the running of this House. According to our Standing Orders we have arrangements whereby we have reviews and we have estimates procedures. No statute—no statute—that this Parliament passes can change those Standing Orders and the difference is in the processes that we have agreed to in the past that the House does legislation on a majority basis but the Standing Orders Committee does it on the basis of near consensus. So if a major party objects to a change then that change will not occur and I want to give notice at this point that it is not the intention of the Labour Party to support a change in the Standing Orders that would adversely affect the rights of this Parliament to examine the actions and the proposed actions of departments in the way that is being proposed by this Government. 
The right to scrutinise the executive the right to scrutinise departments is the main function of this Parliament. It is certainly the major role of Opposition parties and when there is a backbencher from the Government who is awake it is part of their role too and to suggest that we will take away from members of Parliament effectively half their rights to scrutinise the activities of the executive and the Government departments is something that is not acceptable. I see the Minister of State Services is now listening to the debate. I want to repeat the offer from Chris Hipkins last night and to indicate to him that it is our intention—it has always been our intention in these State sector matters—to get legislation that will work whoever is in Government. There is part of this bill that we think is really good there is part of it that we think is rotten and there is some stuff in the middle that we might be able to be convinced on. Although we will oppose this bill now what I am hoping for is a flexibility on the part of the Government so that we can work together to get legislation around which there is at least near unanimity. I think we will not always get the entire House to agree with it but what we have got to know is that whichever party is leading the Government it is relatively comfortable with the State sector legislation of the time because you could be dealing with it basically at a month’s notice. 
So I want to emphasise to Jonathan Coleman that it is not the intention of the Labour Party to assist him to change the Standing Orders to facilitate a reduction in the scrutiny of Government and he needs to take that into account when he considers whether or not he cooperates on this legislation. 
The ASSISTANT SPEAKER (H V Ross Robertson) 
: Just before I call the next speaker I advise the House that this is actually a split call. We got a little bit out of kilter so it should have been called from another side but in this case it has already happened. 
KEVIN HAGUE (Green) 
: 
 I think I am probably one of the few members of this House who has been a State sector chief executive and as such has some direct—I am sorry Dr Prasad. Dr Prasad and I I am sure will have shared the experience of working under these various Acts that are being amended by the State Sector and Public Finance Reform Bill: the State Sector Act the Public Finance Act and the Crown Entities Act. As such I think I have probably got some interesting perspectives to make. 
One of the things that I would have observed from my experience as a chief executive in the State sector was that the sector was not well geared up to work together to facilitate a whole-of-Government response. Although we had very many I guess meetings across Government where we sat around and spoke about the problems and agreed that some joined-up response would be the appropriate way of responding to those problems sadly this very seldom came to pass because agencies were not well set up or not well instructed by Ministers to be able to collaborate across their traditional boundaries. 
From that point of view I am a person who welcomes any initiative to make the State sector work better as a whole and deliver on that whole-of-Government response. Very many of the issues that this Parliament wrestles with are ones that demand a more sophisticated response than the fragmented one that we all too often are able to deliver. 
Having said that and noting that that forms the central theme in the explanatory note of this bill—facilitating that whole-of-Government response—those are provisions that the Green Party could support. But we find ourselves in that dilemma that is often posed by Governments that have taken omnibus approaches to law reform where there are parts of the bill that are worth supporting but others that simply are not. Other colleagues have spoken about some of the deficiencies of this bill. I want to mention a few others. Certainly various members have spoken about the issue of making the boundaries around the State sector more porous and ill-defined to facilitate the privatisation of State services. That is one of the things that this bill will do if enacted. 
There is another function that is worthy of discussion and that is that this bill will facilitate Ministers appointing people into departments otherwise than on merit. What that is code for is appointing ministerial observers in departments. That is a development that runs counter to the central aim of the State Sector Act. The State Sector Act was about separating out functions and clarifying responsibilities. What this bill does in this part and in another that I will mention in a moment is it actually facilitates those boundaries becoming blurred. So that is another of the effects of this bill that the Green Party certainly opposes. 
But the one that I want to mention lastly is the effect of the bill to establish these departmental agencies within Government departments. What that will do is confuse the lines of funding accountability and performance accountability. So entities will receive their funding from one source but be accountable to another Minister. Again what that does is take lines that were separated by the State Sector Act and wrap them and tangle them up altogether. So the bill is good in parts but undermines in others the very tenets of the State Sector Act. We oppose it. 
The ASSISTANT SPEAKER (H V Ross Robertson) 
: I call the honourable member David Bennett. 
Andrew Williams 
: Why? 
DAVID BENNETT (National—Hamilton East) 
: 
 It will be good Andrew Little. This bill the State Sector and Public Finance Reform Bill is about recognising the Public Service. I think we need to do that first of all—recognise the good work that many people do in the service of our communities through the Public Service. When you think of all those people out there who give extra time and work hard for our communities it is very sad that the Opposition in this Parliament will create fear in those good people try to put up conspiracy theories and say that things are being done against their nature. It is the true nature of the left that those members try to use fear tactics on the most vulnerable people in our community and they try to do it to the people whom they purport to support. It is a shame and a disgrace for this House to see the left wing do that. 
When we look at the Opposition members they have talked about the amalgamation of estimates and financial reviews and that scrutiny. It is just not true. It is just not true at all. How can somebody like Trevor Mallard come into this House and say things like that? The other person here is Andrew. Andrew Little is it not from the New Zealand First Party. He came in here last night and said that there was a new Soviet-style power grab by the Prime Minister in this bill. What was it? Was it new section 6(j) that Andrew brought into this House— 
The ASSISTANT SPEAKER (H V Ross Robertson) 
: Order! The member’s full name. 
DAVID BENNETT 
: Yes well I do not even know his surname. He has not been here long enough. The member from New Zealand First came in— 
Andrew Williams 
: Mr Williams to you. 
DAVID BENNETT 
: Mr Williams came in and said that. The good thing is that—just for Mr Williams’ knowledge and you should not put a press release out unless you check the facts—that section already exists in the State Sector Act. It has been there since 1988. So it is not a new clause Mr Williams; it actually exists. He did a lovely press release today saying that this section is a new clause. Well stick to the facts get your facts right and do not try to patronise and take advantage of those people who are giving good work to our community. Thank you. 
LOUISE UPSTON (National—Taupo) 
: 
 I am pleased to take the final call on the State Sector and Public Finance Reform Bill. Minister Coleman the Minister in charge of this bill very widely covered what this bill does cover but I just wanted to cover a couple of things that this bill does not do. 
Unfortunately we have seen many examples this week of Labour members of Parliament who are innumerate and cannot count. We have also seen New Zealand First members who are illiterate and cannot read. My colleague David Bennett has already mentioned the fact that there is a clause in the bill that has been there for many many years and unfortunately Andrew Williams the member for New Zealand First cannot read and completely missed that point. So it does not make any changes to what the Prime Minister can do. 
The other area the Labour members have been severely disillusioned about and completely off the planet on is changes to the estimates scrutiny process or the financial review process. There are no changes to that. The Standing Orders of the Parliament are what dictates the scrutiny for Parliament. This bill does not make any changes at all to the estimates and the financial review scrutiny. It also does not affect any of the timing of when those reviews take place. 
I am happy with those few points about what the bill does not do because if you had heard the debate yesterday you would have thought otherwise. But it is just more scaremongering from that side of the House. I am proud of this bill. I am proud of making our public services better and more efficient and delivering more to hard-working New Zealanders. 
A party vote was called for on the question  
That the State Sector and Public Finance Reform Bill be now read a first time. 
Ayes 63 
New Zealand National 59; Maori Party 2; ACT New Zealand 1; United Future 1. 
Noes 57 
New Zealand Labour 34; Green Party 14; New Zealand First 8; Mana 1. 
Bill read a first time. 
Bill referred to the Finance and Expenditure Committee.