ANALYSIS: Leaks Suggest Frustration With NZ Government Ignoring Official Advice

(L-R) Winston Peters, leader of NZ First party, New Zealand Prime Minister Christopher Luxon of the centre-right National Party, and David Seymour, leader of the libertarian-ACT New Zealand party, attend the signing of an agreement to form a three-party coalition government at Parliament in Wellington on Nov. 24, 2023. Marty Melville/AFP via Getty Images

Analysis

In office for only 12 days, the New Zealand tri-party coalition government has been hit by leaks of confidential information, with documents revealing the current Cabinet is ignoring advice from officials.

Earlier this week Prime Minister Christopher Luxon admitted the government was ignoring official advice on repealing the Fair Pay Agreements (FPA).

The paper was prepared for Minister for Workplace Relations Brooke van Velden, a member of the ACT Party, in coalition with National and NZ First.

Mr. Luxon seemed surprised by the leak when asked about it earlier in the week.

The document said the Cabinet would consider repealing the legislation at its meeting on Dec. 11.

While leaks are a common tactic in contemporary politics, it is still unusual for a leak to occur regarding a decision yet to be taken.

It created a hurdle for the government as it included a scalding assessment of what the Fair Pay repeal would mean for people on low incomes, particularly women, young people, Māori, the disabled, and Pacific people.

“Given these populations are disproportionately represented in workforces where there are lower employment terms, they could have disproportionately benefited from any improved terms obtained by an FPA”, the paper concluded.

Previous Process to Scrutinise Proposals Not Being Followed

In the most recent leak, the media was handed a paper from Treasury, revealing the government suspended Regulatory Impact Analyses (RIAs, also called Regulatory Impact Statements) for some proposals, meaning they will not undergo the same processes commonly used under previous governments.

Leaks of Treasury papers are also exceptionally rare.

The decision means the repeal of some laws will face almost no scrutiny.

The former Ardern Labour government also briefly suspended RIAs during the pandemic.

The paper said the Cabinet agreed that proposals that “solely repeal legislation” and were “not seeking approval for new policy” would require an RIA be “suspended.”

Since much of the government’s planned activity in its first 100 days involves undoing much of the legislation passed by the previous government, this will mean a large number of proposals escape public service scrutiny, and ministers will make decisions with no advice beyond that of their advisors, who are mostly political appointments.

What Role RIS Has Played in Government

Aside from ending Fair Pay Agreements, other initiatives that will avoid RIA scrutiny include the contentious repeal of Smokefree legislation—a move which has attracted local and international criticism—legislation to narrow the Reserve Bank’s mandate to price stability, and the removal of the Māori Health Authority.

Somewhat ironically, the RIA regime was introduced by the ACT Party when it was previously in a two-party coalition with the National Party under Prime Minister John Key.

They were originally designed to give ministers (and the public) a warning about any consequences of Cabinet decision-making.

However, they can often be politically embarrassing for the government of the day if those consequences are either unforeseen or have not been transparently explained to the public.

A particularly critical RIA about a change to the rules on GST for KiwiSaver (superannuation) funds saw the former Ardern government forced to change direction within 24 hours of it being published.

Minister Says No Time for RIS

Finance Minister Nicola Willis said the new government was taking a similar approach to its predecessors.

She claimed the public service was working so quickly to implement the 100-day plan that agencies did not “have time to implement an exhaustive RIS.”

“The commitments laid out in the 100-day plan were campaigned on and the new government is getting on with delivering them. A truncated process for Regulatory Impact Statements is appropriate in this context,” she said.

Proposals from the 100-day plan that go to Cabinet after the timeframe expires will have a full RIA.

Deputy PM Critical of RIS

Minister of Regulation and ACT Party Leader David Seymour has previously been critical of the quality of RIAs, and said the government was “committed to substantially improving [their] quality ... so that their inclusion in the law-making process in future is far more valuable.”

However, Labour Leader Chris Hipkins said, “It appears Christopher Luxon is overseeing a government that has not only leaked for the second time in a week, but also thinks it’s above scrutiny ... they’re saying they don’t want advice.

“Regulatory scrutiny is an important part of the policy process, and choosing not to receive it should only be done in specific circumstances, [such as] an emergency response.”

An air of ad hocness has surrounded the new government since the three leaders first appeared on the podium to announce that a tri-party coalition agreement had been reached, when NZ First leader and Deputy Prime Minister Winston Peters began lambasting journalists, with Mr. Luxon seemingly unable to rein him in.

When media were briefly allowed into the Cabinet room to photograph and film the new government’s first Cabinet meeting, Mr. Peters accused them of “taking bribes,” in reference to the Ardern-era, taxpayer-funded Public Interest Journalism Fund.

Mr. Luxon was asked about those comments but did not respond, while other Cabinet ministers appeared uncomfortable with the matter. Mr. Luxon then tried to defuse the situation by making jokes about the roundness of the Beehive.