McNair Craig: Public Finance (State Sector Management) Bill — First Reading 
McNair Craig: Public Finance (State Sector Management) Bill — First Reading 
[Volume:614;Page:10756] 
CRAIG McNAIR (NZ First) 
: 
 The Public Finance (State Sector Management) Bill is a very thick bill—though not I might add as thick as the income tax legislation which is I think the biggest bill ever brought into this House. But this bill is about 350 pages long so it is still a very big bill. Therefore a lot of hours will I am sure be spent on looking at the bill and understanding it fully as the Finance and Expenditure Committee examines it and listens to submissions and as we examine it to make sure it fulfils the purposes and aims that the Government wants from it. 
I note that the Government claims that the bill covers the main Acts that govern public finance and the management of the State sector. I also note that this bill is the culmination of a review of public sector management—the Review of the Centre. The Review of the Centre suggested initiatives to support better integration great flexibility and an increased focus on results without losing the system’s current strengths of transparency accountability and financial management. The finance Minister Michael Cullen has said that the bill is designed to strengthen the public service. He said it will make the public service more transparent and flexible will allow a more integrated response to complex social problems involving a number of State agencies and will invigorate the culture of the State sector. 
New Zealand First will be supporting this bill being referred through to the select committee. That is all we can say at this point. As this bill goes through the select committee process and as we hear submissions New Zealand First members will be looking to see whether the bill does just what Michael Cullen says that it will do. We also want to hear the submissions on the bill before judging whether it will achieve its goals in more ways than one. 
The bill stems from the 2001 Review of the Centre and represents the first major change to State sector governance in a decade. It integrates the Fiscal Responsibility Act into the Public Finance Act as mentioned by the speaker a couple of speeches before me. It amends the Public Finance Act and the State Sector Act and when enacted will create a new Crown Entities Act. It is said that the bill will improve transparency and accountability. I do believe that the bill requires Treasury to report every 4 years on the fiscal outlook and risks over the next 40 years with specific reference to the implications of an ageing population. I believe that New Zealand First has played a key role in this House in the last 10 years—since it was formed—in looking out for the elderly and also in facing up to the implications of an ageing population and what we should do about that with regard to superannuation for example. Superannuation is a big issue with regard to that part of the bill the implications of an ageing population and so on. In 1997 New Zealand First put up a referendum proposal that superannuation be allocated into individual accounts. The funding of superannuation is a problem that will not go away and it is something that the New Zealand First Party has always advocated that we must face as a country. The current Superannuation Fund is one step in the right direction but we have a long long way to go. We have to improve the bill and we also have to improve other measures in order to make sure that as a country we can face those hard decisions. 
I also note that the bill proposes the Budget will include a statement on the impact on revenue flows of recent Government taxation decisions. I believe that that will be very telling. Another issue I would like to raise is why we do not have a similar statement with regard to social spending as well—on what is necessary and what is not. I believe that this Government spends far too much money on the wrong things and that its priorities are in the wrong place. My party agrees with me that this Government spends millions of dollars on the arts for example when we feel that that money could be put into other places— 
David Benson-Pope 
: What? 
CRAIG McNAIR 
: I raised the question a minute ago of superannuation and that would be a great start I tell Mr Benson-Pope. We have to face those things. 
In getting back to the serious issue of this bill I also note that it will require departments Officers of Parliament and Crown entities to report to Parliament annually not just on their finances but also on their intended and actual performances. We are always interested in legislation that promotes performance in Government departments and requires Government departments to give taxpayers the best value for their money. One of the reasons we are supporting the referral of this bill to the select committee is that it has some positive aspects and we want to see whether we can work on the bill and improve it to make sure that it is beneficial for the New Zealand taxpayer in that way. I note that Crown entities encompass a huge number and diverse range of organisations from schools—it is a pity that some of them have been shut down—and hospitals to Radio New Zealand and other organisations and departments. They account for almost half the State sector administrative budget and employ two-thirds of the State workforce. 
In closing it is interesting to note that the bill allows more than one Minister to be responsible for a vote while also making it clear—or the Government says the bill makes it clear—which Minister is answerable to Parliament for each appropriation. Also the bill enables Ministers to make fiscally neutral adjustments between departmental output classes covered by the same appropriation without further reference to Parliament. The question is whether the bill will maintain accountability by requiring performance reporting on the individual output classes and that is something we will have to examine in the select committee. Once again New Zealand First supports the referral of this bill to the select committee and looks forward to hearing submissions on it.