New Zealand

   

Executive Capacity

#3
Key Findings
With a strong focus on interministerial coordination, New Zealand is rated among the top performers (rank 3) in the area of executive capacity. Its score on this measure has improved by 0.1 point since 2014.

A strong government office engages with ministries in a highly collaborative system, and is responsible for centralized strategic planning. Formal and informal coordination between ministries and with the government office is common. Unlike its predecessor, the Labour-led government is a formal coalition, which changes, but does not diminish, the official character of informal coordination.

Impact assessments are mandatory and systematically performed, with a strong quality-assurance component. Societal consultation is robust, although a trend of passing bills under conditions of urgency, precluding public input, was evident under the previous administration.

Ministerial compliance is strong, based on a principle of collective responsibility. Labour cabinets are elected by all party parliamentary members rather than selected by the prime minister alone. After strongly opposing aspects of the Trans-Pacific Partnership trade agreement, the incoming government endorsed the project following negotiation of several amendments.

Strategic Capacity

#6

How much influence do strategic planning units and bodies have on government decision-making?

10
 9

Strategic planning units and bodies take a long-term view of policy challenges and viable solutions, and they exercise strong influence on government decision-making.
 8
 7
 6


Strategic planning units and bodies take a long-term view of policy challenges and viable solutions. Their influence on government decision-making is systematic but limited in issue scope or depth of impact.
 5
 4
 3


Strategic planning units and bodies take a long-term view of policy challenges and viable solutions. Occasionally, they exert some influence on government decision-making.
 2
 1

In practice, there are no units and bodies taking a long-term view of policy challenges and viable solutions.
Strategic Planning
8
The core executive in New Zealand is organized according to new public-management approaches and methods. Most importantly, contracts are negotiated between ministers and chief executives. With the large number of government departments and ministers (28), most of whom are responsible for several portfolios, taking a whole-of-government approach to policy development can be complex and time-consuming. Recent governments have reacted to concerns about fragmentation by recentralizing the steering capacity of the core executive. The most important government departments involved in strategic planning and policy formation are the central agencies of the Department of the Prime Minister and Cabinet (DPMC), the State Services Commission (SSC) and the Treasury. All contracts (performance agreements and departmental statements of intent) support a cooperative and whole-of-government policy approach, though evaluation of the performance assessment of chief executives has a strong focus on departmental achievements. The National government (2008-17) sought to achieve substantial efficiency reforms without a major reorganization of public sector departments and ministries. This led to various initiatives, such as greater rationalization and coordination with respect to back-office functions (such as IT, payroll and procurement) with a view to achieving savings which can be shifted to delivering frontline services. Since chief executives are on contract and employ staff, these changes can occur only with their support and cannot be imposed on individual departments.

Developing strategies to enhance public sector performance management has been progressing for some time. Since the government has imposed a cap on the size of the state sector, these measures are aimed at securing greater efficiency, effectiveness and performance across the sector. Recent initiatives include the Better Public Services (BPS) program and the Policy Project Frameworks. BPS aims to build efficient and effective public services by emphasizing outputs, strengthening leadership and providing better services and greater value for money. The Policy Project Frameworks aims to improve government infrastructure around policy capability, skills and advice. Under the new prime minister, Bill English, who took office after the surprise resignation of John Key in December 2016, the government updated 10 Better Public Services targets as part of a new social investment package that included changed standards for improved math and literacy skills in primary schools, better health outcomes for new mothers and their children, reductions in child abuse and the number of serious crime victims, lower welfare dependence and faster times to access social housing.

The prime minister can draw on only moderate strategic-planning capacity (in the form of a policy-advisory group) vis-à-vis ministers. Ad hoc groups, often including some outside expertise, are increasingly used to complement government agencies’ policy-advisory function.

Citations:
Department of the Prime Minister and the Cabinet (DPMC). Annual Report for the Year Ended 30 June 2015 (Wellington: State Services Commission 2015) http://www.dpmc.govt.nz/sites/all/files/publications/dpmc-annual-report-2015.pdf (accessed 5 October, 2016).
Prime Minister Launches Policy Project Frameworks. Department of the Prime Minister and the Cabinet (DPMC). http://www.dpmc.govt.nz/node/1566 (accessed 5 October, 2016).
Performance Improvement Framework: http://www.ssc.govt.nz/pif (accessed October 9, 2014).
Six Dimensions of System Performance (Wellington: State Services Commission 2013).
State Services Commission: Annual Report for the Year Ended 30 June 2013 (Wellington: State Services Commission 2013).
The Capability Toolkit – A Tool to Promote and Inform Capability Management (Wellington: The Government of New Zealand 2008).
McBeth, Paul, 2017. English flags $321m social investment package for needy Kiwis. New Zealand Herald. 3 May 2017.

How influential are non-governmental academic experts for government decisionmaking?

10
 9

In almost all cases, the government transparently consults with a panel of non-governmental academic experts at an early stage of government decision-making.
 8
 7
 6


For major political projects, the government transparently consults with a panel of non-governmental academic experts at an early stage of government decision-making.
 5
 4
 3


In some cases, the government transparently consults with a panel of non-governmental academic experts at an early stage of government decision-making.
 2
 1

The government does not consult with non-governmental academic experts, or existing consultations lack transparency entirely and/or are exclusively pro forma.
Scholarly Advice
7
In terms of frequency and intensity of policy advice, the relevance of external academic experts for governmental policymaking depends on the subject area. Non-governmental academics with technical expertise can have a significant role in policy areas such as health, energy, social policy and tertiary education. In general, the importance of scholarly advice is increasing. The most recent initiatives in this regard include the establishment of a Maori Language Advisory Group and an expert panel tasked with overseeing the overhaul of Child, Youth and Family, a service agency subordinate to the Ministry of Social Development. One of the innovations of the 2008-17 National government was the appointment of a Prime Minister’s Chief Science Advisor.

Citations:
Eichbaum, Chris und Richard Shaw: Minding the Minister? Ministerial Advisers in New Zealand Government, New Zealand Journal of Social Sciences Online, 2007, Vol. 2: 95-113.
Eichbaum, Chris und Richard Shaw: Revisiting Politicization: Political Advisers and Public Servants in Westminster Systems, Governance: An International Journal of Policy, Administration and Institutions, 2008, Vol. 21, No. 3: 337-363.

Interministerial Coordination

#2

Does the government office / prime minister’s office (GO / PMO) have the expertise to evaluate ministerial draft bills substantively?

10
 9

The GO / PMO has comprehensive sectoral policy expertise and provides regular, independent evaluations of draft bills for the cabinet / prime minister. These assessments are guided exclusively by the government’s strategic and budgetary priorities.
 8
 7
 6


The GO / PMO has sectoral policy expertise and evaluates important draft bills.
 5
 4
 3


The GO / PMO can rely on some sectoral policy expertise, but does not evaluate draft bills.
 2
 1

The GO / PMO does not have any sectoral policy expertise. Its role is limited to collecting, registering and circulating documents submitted for cabinet meetings.
GO Expertise
8
The policy-advisory group in the Department of Prime Minister and Cabinet (DPMC) currently consists of 14 staff members covering a broad spectrum of policy expertise. They are in constant contact with the prime minister and provide advice on all cabinet and cabinet committee papers. They also engage in coordinating interministerial cooperation. The policy-advisory group provides direct support to the prime minister on specifically commissioned initiatives, such as the prime minister’s “Tackling Methamphetamine” Action Plan. In 2015, a Legislation Design and Advisory Committee (LDAC) was established with the aim of improving the quality and effectiveness of legislation. The LDAC advises departments regarding the design and content of bills while still in the development stage.

Citations:
Annual Report for the Year Ended 30 June 2014 (Wellington: Department of the Prime Minister and Cabinet 2014).
Policy Advisory Group: http://www.dpmc.govt.nz/pag (accessed October 24, 2015).
Legislation Design and Advisory Committee: http://www.ldac.org.nz/ (accessed 30 November, 2015).

Can the government office / prime minister’s office return items envisaged for the cabinet meeting on the basis of policy considerations?

10
 9

The GO/PMO can return all/most items on policy grounds.
 8
 7
 6


The GO/PMO can return some items on policy grounds.
 5
 4
 3


The GO/PMO can return items on technical, formal grounds only.
 2
 1

The GO/PMO has no authority to return items.
GO Gatekeeping
9
The key policy adviser in the Department of Prime Minister and Cabinet (DPMC) plays an influential role in policy processes and regularly intervenes to “pull” cabinet papers that are deemed to be inadequate in some way.

Citations:
Confidential information by a policy adviser in the DPMC.

To what extent do line ministries involve the government office/prime minister’s office in the preparation of policy proposals?

10
 9

There are inter-related capacities for coordination in the GO/PMO and line ministries.
 8
 7
 6


The GO/PMO is regularly briefed on new developments affecting the preparation of policy proposals.
 5
 4
 3


Consultation is rather formal and focuses on technical and drafting issues.
 2
 1

Consultation occurs only after proposals are fully drafted as laws.
Line Ministries
9
If line ministries prepare a policy proposal, they are obliged to consult other ministries that are affected as well as the coordinating units, the Department of Prime Minister and Cabinet (DPMC), the Treasury and the State Services Commission. There are clear guidelines which not only de jure but also de facto govern the coordination of policy formulation in the core executive.

Citations:
CabGuide – Consultation: http://cabguide.cabinetoffice.govt.nz/procedures/consultation (accessed October 9, 2014).
Cabinet Manual: http://www.cabinetmanual.cabinetoffice.govt.nz/3.28 (accessed October 24, 2015).

How effectively do ministerial or cabinet committees coordinate cabinet proposals?

10
 9

The large majority of cabinet proposals are reviewed and coordinated first by committees.
 8
 7
 6


Most cabinet proposals are reviewed and coordinated by committees, in particular proposals of political or strategic importance.
 5
 4
 3


There is little review or coordination of cabinet proposals by committees.
 2
 1

There is no review or coordination of cabinet proposals by committees. Or: There is no ministerial or cabinet committee.
Cabinet Committees
9
There are clear guidelines for policy formulation in the New Zealand core executive. All policy proposals are reviewed in cabinet committees. Full cabinet meetings therefore can focus on strategic policy debates and policy conflicts between coalition partners or between the government and its legislative support parties in the House of Representatives. In quantitative terms, from 1 July 2014 to 30 June 2015, the full cabinet met 39 times while cabinet committees met 121 times. A revised cabinet committee structure was implemented in October 2014 following the formation of the government after the 2014 general election. This resulted in the disestablishment of one cabinet committee, reducing the overall number from 11 to 10. Key committees include Economic Growth and Infrastructure, Social Policy and Cabinet Legislation.

Citations:
Annual Report for the Year Ended 30 June 2015 (Wellington: Department of the Prime Minister and Cabinet 2015).
Cabinet Office Circular CO 14) 8. Cabinet Committees: Terms of Reference and Membership, http://www.dpmc.govt.nz/cabinet/circulars, accessed October 24, 2016).

How effectively do ministry officials/civil servants coordinate policy proposals?

10
 9

Most policy proposals are effectively coordinated by ministry officials/civil servants.
 8
 7
 6


Many policy proposals are effectively coordinated by ministry officials/civil servants.
 5
 4
 3


There is some coordination of policy proposals by ministry officials/civil servants.
 2
 1

There is no or hardly any coordination of policy proposals by ministry officials/civil servants.
Ministerial Bureaucracy
9
The cabinet process is overseen by the cabinet office on the basis of clear guidelines. Departmental chief executives typically meet with ministers prior to cabinet meetings to discuss the agenda and clarify matters. The amount and effectiveness of policy proposal coordination varies a great deal depending on the policy field. However, there is clearly coordination in the preparation of cabinet papers and demanding processes specified in cabinet office circulars.

Citations:
CabGuide – Officials’ Committees that support Cabinet Committees: http://cabguide.cabinetoffice.govt.nz/context/definitions/officials-committees (accessed October 9, 2014).
CabGuide – Role of the Cabinet Office: http://cabguide.cabinetoffice.govt.nz/context/definitions/cabinet-office (accessed October 9, 2014).

How effectively do informal coordination mechanisms complement formal mechanisms of interministerial coordination?

10
 9

Informal coordination mechanisms generally support formal mechanisms of interministerial coordination.
 8
 7
 6


In most cases, informal coordination mechanisms support formal mechanisms of interministerial coordination.
 5
 4
 3


In some cases, informal coordination mechanisms support formal mechanisms of interministerial coordination.
 2
 1

Informal coordination mechanisms tend to undermine rather than complement formal mechanisms of interministerial coordination.
Informal Coordination
9
In addition to formal coordination, there are a number of informal channels between coalition partners, government and legislative support parties, and ministers and their parliamentary parties. Although media commentary tends to not draw a distinction between formal coalitions (e.g., Labour/NZ First 2017-) and non-coalition support parties (e.g., National 2008-17), the Cabinet Manual seeks to at least formally clarify which procedures should be used as a guideline in case of informal coordination. For instance, Cabinet Office Circular CO (15) 1 “National-led Administration: Consultation and Operating Arrangements” defines the relationship between government ministers and ministers from parties that are not officially part of the government: “Support-party ministers are not members of cabinet. From time to time, support-party ministers and other ministers outside cabinet may seek the prime minister’s agreement to attend cabinet when significant matters within their portfolios are being addressed.”

Citations:
Cabinet Office Circular CO (15) 1 (Wellington: Cabinet Office 2015).

Evidence-based Instruments

#1

To what extent does the government assess the potential impacts of existing and prepared legal acts (regulatory impact assessments, RIA)?

10
 9

RIA are applied to all new regulations and to existing regulations which are characterized by complex impact paths. RIA methodology is guided by common minimum standards.
 8
 7
 6


RIA are applied systematically to most new regulations. RIA methodology is guided by common minimum standards.
 5
 4
 3


RIA are applied in some cases. There is no common RIA methodology guaranteeing common minimum standards.
 2
 1

RIA are not applied or do not exist.
RIA Application
10
Following its restrictive policy regarding regulation, the National government introduced a guideline in late 2009 with the effect that regulatory impact assessments (RIAs) are systematically undertaken for any policy activity involving options that may result in a paper being submitted to the cabinet and may accordingly lead to draft legislation. This aims at restricting new regulations to those that the government sees as necessary, sensible and robust, while avoiding regulations that are ineffective and costly.

Citations:
Cabinet Office Circular CO (09) 8: Regulatory Impact Analysis Requirements: New Guidance (Wellington: Cabinet Office 2009).
Regulatory Impact Analysis Handbook (Wellington: The Treasury 2013).
New Zealand’s Regulatory Management System: http://www.treasury.govt.nz/regulation/system (accessed November 30, 2015).

Does the RIA process ensure participation, transparency and quality evaluation?

10
 9

RIA analyses consistently involve stakeholders by means of consultation or collaboration, results are transparently communicated to the public and assessments are effectively evaluated by an independent body on a regular basis.
 8
 7
 6


The RIA process displays deficiencies with regard to one of the three objectives.
 5
 4
 3


The RIA process displays deficiencies with regard to two of the three objectives.
 2
 1

RIA analyses do not exist or the RIA process fails to achieve any of the three objectives of process quality.
Quality of RIA Process
9
The Treasury’s Regulatory Impact Analysis Handbook offers comprehensive guidance with regard to consultation within government as well as with stakeholders, to transparency and to quality evaluation. The major instrument for consultation and transparency is the regulatory impact statement (RIS). Independent quality assurance is to be obtained either by a unit located within the Treasury or through a suitable internal review process. A quality-assurance statement is to be provided in the cabinet paper.

Citations:
Regulatory Impact Analysis Handbook (Wellington: The Treasury 2013).

Does the government conduct effective sustainability checks within the framework of RIA?

10
 9

Sustainability checks are an integral part of every RIA; they draw on an exhaustive set of indicators (including social, economic, and environmental aspects of sustainability) and track impacts from the short- to long-term.
 8
 7
 6


Sustainability checks lack one of the three criteria.
 5
 4
 3


Sustainability checks lack two of the three criteria.
 2
 1

Sustainability checks do not exist or lack all three criteria.
Sustainability Check
9
Without using the term “sustainability,” the regulatory impact assessment (RIA) process includes major aspects of this concept’s underlying idea. Part of the quality-assurance monitoring process is to check whether all substantive economic, social and environmental impacts have been identified (and quantified where feasible). In addition, it is an integral part of RIAs to plan for regulatory-instrument reviews that consider the following issues: Is there still a problem (and is it the one originally identified)? Are objectives being met? Are the impacts as expected? Are there any unforeseen problems? Are there any indirect effects that were not anticipated? Is intervention still required? Is the current intervention still the most appropriate, or would another measure be more suitable?

Citations:
Regulatory Impact Analysis Handbook (Wellington: The Treasury 2013).

Societal Consultation

#5

To what extent does the government consult with societal actors to support its policy?

10
 9

The government successfully motivates societal actors to support its policy.
 8
 7
 6


The government facilitates the acceptance of its policy among societal actors.
 5
 4
 3


The government consults with societal actors.
 2
 1

The government rarely consults with any societal actors.
Negotiating Public Support
8
New Zealand has a strong tradition of broad policy consultation with interest groups and with its citizens. The need for consultation has been enhanced by two developments. One is the change to a multiparty system and the formation of minority governments, which require the support of smaller parties to be able to pass legislation. The other relates to a greater diversity and sophistication of voters, with political views that are more difficult to predict and no longer fit within a simple left-right dynamic. While it may be the case that the ideologies of some parties may make them more compatible than others, under a mixed-member proportional (MMP) system it is not always easy to predict where a minor party will sit on a particular issue. Moreover, elected representatives of local governments have generally avoid partisan affiliations, and local governments have a tradition of consulting with their citizens and communities, and consultation is mandated in many cases under the Local Government Act 2002. Consultation is also commonly used by central government agencies with respect to new policy initiatives. When a consultation has taken place, the details of consultations, internal and external, need to be set out in regulatory impact statements. While parliamentary select committees hold hearings on proposed legislation once it has been introduced in parliament, giving individuals and organizations the opportunity to make written or oral submissions, the incidence of by-passing select committees by introducing bills under urgency is growing. In late 2015, for example, a high-profile law to monitor the activities of New Zealand citizens with criminal records who had been deported from Australia was passed under conditions of urgency, thereby precluding any opportunity for public input or debate. In 2014, the government allowed a mere three days of public submissions as part of a review of New Zealand’s anti-terrorism laws. In addition to the aforementioned tools for measuring public opinion, both the government and organizations that are likely to be affected by policy outcomes make increasing use of opinion polls, media and online comment and focus groups. One such initiative was the establishment of a Rules Reduction Taskforce by the local government minister in October 2014. The taskforce held community meetings across the country to hear complaints from property-owners groups and local government about ineffective property rules.

Citations:
Cabinet Office Circular CO (09) 8: Regulatory Impact Analysis Requirements: New Guidance (Wellington: Cabinet Office 2009).
Local Government Act 2002: http://www.legislation.govt.nz/act/public/2002/0084/latest/DLM172326.html (accessed October 9, 2014).

Policy Communication

#12

To what extent does the government achieve coherent communication?

10
 9

The government effectively coordinates the communication of ministries; ministries closely align their communication with government strategy. Messages are factually coherent with the government’s plans.
 8
 7
 6


The government coordinates the communication of ministries. Contradictory statements are rare, but do occur. Messages are factually coherent with the government’s plans.
 5
 4
 3


The ministries are responsible for informing the public within their own particular areas of competence; their statements occasionally contradict each other. Messages are sometimes not factually coherent with the government’s plans.
 2
 1

Strategic communication planning does not exist; individual ministry statements regularly contradict each other. Messages are often not factually coherent with the government’s plans.
Coherent Communication
7
The coherence of government communication strongly depends on the topic under consideration. All recent governments have been of the minority type, which has increased the chances of conflict between the governing party and its small support partners. This may include disagreement over what constitutes an electoral mandate, as well as accusations of broken promises when sacrifices have to be made during the course of the post-election negotiating process. Successive minority governments have freely acknowledged that tension is part and parcel of the governing process under a mixed-member proportional (MMP) system, with an “agree to disagree” clause being all that may separate the government from instability and collapse. That said, MMP governments have been remarkably stable, with only one early election (2002) – which was due as much to electoral considerations as political instability, since the advent of the proportional electoral system in 1996. One development that requires careful reporting is the growing trend of political spin among both politicians and bureaucrats, which exacerbates the public’s skepticism regarding communication processes in government.

Citations:
Jonathan Boston, Innovative Political Management: Multiparty Governance in New Zealand. Policy Quarterly 5:2 (2009), 51-59.

Implementation

#2

To what extent can the government achieve its own policy objectives?

10
 9

The government can largely implement its own policy objectives.
 8
 7
 6


The government is partly successful in implementing its policy objectives or can implement some of its policy objectives.
 5
 4
 3


The government partly fails to implement its objectives or fails to implement several policy objectives.
 2
 1

The government largely fails to implement its policy objectives.
Government Efficiency
9
Throughout the review period, the three-term National government held minority status, although its 2014 victory, with 47% of the vote and 59 out of 121 seats, brought it closer to majority status than any other under MMP (indeed, the last time a party gained over 50% of the vote was in 1951). Minority status implies that the government has to anticipate the policy preferences of other parties in parliament and needs to seek legislative support on an issue-by-issue basis. Nevertheless, minority single party and minority-coalition governments have been relatively successful in implementing their agendas. The focus of the National minority government’s policy priorities included: building a stronger and more competitive economy; ensuring a budgetary surplus; and selectively funding major infrastructure developments and public services.

Citations:
Statement of Intent 2014-2018 (Wellington: Department of the Prime Minister and Cabinet 2014).
Statement of Intent 2014-2018 (Wellington: State Services Commission 2014).

To what extent does the organization of government provide incentives to ensure that ministers implement the government’s program?

10
 9

The organization of government successfully provides strong incentives for ministers to implement the government’s program.
 8
 7
 6


The organization of government provides some incentives for ministers to implement the government’s program.
 5
 4
 3


The organization of government provides weak incentives for ministers to implement the government’s program.
 2
 1

The organization of government does not provide any incentives for ministers to implement the government’s program.
Ministerial Compliance
9
There is a strong tradition of collective responsibility of the cabinet. Ministers are allowed to disagree over policy initiatives, even in public, but once a decision has been made in cabinet they have to follow the collective will. The Cabinet Manual 2008 is very explicit about this. The prime minister has the power to appoint and dismiss ministers (formally it is the governor-general who does this on the advice of the prime minister). In reality, however, whereas the National Party’s cabinet is chosen by the prime minister, Labour’s is subject to an election by all of its members of parliament, with the prime minister’s direct power being largely limited to the ranking of ministers and allocation of portfolios. Naturally, in coalition governments or minority governments with support agreements with other parties, the prime minister’s power over the personnel of another party is restricted. Collective responsibility within a formal coalition arrangement is strengthened by an extensive list of coalition management instruments based on a comprehensive coalition agreement with regard to the legislative agenda but also procedures to ensure coalition discipline. On the other hand, there are procedures for dealing with a minority government. The most recent National minority government built on the experience of earlier minority governments on how to ensure ministerial compliance under a confidence and supply mandate. In its Cabinet Office Circular CO (15) 1 “National-led Administration: Consultation and Operating Arrangements,” the government at the time of writing specified the nature of its agreements with support parties that receive ministerial appointments outside of cabinet. While such ministers may disagree with government policy if it lies outside their ministerial responsibility, they are bound by collective responsibility on issues within their portfolio.

Citations:
Cabinet Office Circular CO (15) 1 (Wellington: Cabinet Office 2015).

How effectively does the government office/prime minister’s office monitor line ministry activities with regard to implementation?

10
 9

The GO / PMO effectively monitors the implementation activities of all line ministries.
 8
 7
 6


The GO / PMO monitors the implementation activities of most line ministries.
 5
 4
 3


The GO / PMO monitors the implementation activities of some line ministries.
 2
 1

The GO / PMO does not monitor the implementation activities of line ministries.
Monitoring Ministries
9
Following from the experience of fragmented policymaking in vertically integrated networks, all recent governments have strengthened the steering capacity of the core executive. All contracts between cabinet and line ministries and ministers and chief executives are based on a whole-of-government policy approach. National introduced a performance-improvement framework intended to strengthen a central-agency approach to assessing, supporting, informing and focusing performance across state services.

Citations:
Statement of Intent 2014-2018 (Wellington: State Services Commission 2014).

How effectively do federal and subnational ministries monitor the activities of bureaucracies and executive agencies with regard to implementation?

10
 9

The ministries effectively monitor the implementation activities of all bureaucracies/executive agencies.
 8
 7
 6


The ministries monitor the implementation activities of most bureaucracies/executive agencies.
 5
 4
 3


The ministries monitor the implementation activities of some bureaucracies/executive agencies.
 2
 1

The ministries do not monitor the implementation activities of bureaucracies/executive agencies.
Monitoring Agencies, Bureaucracies
9
The monitoring of executive agencies is based on the same procedures governing line ministries.

Citations:
State Services Commission: Annual Report for the Year Ended 30 June 2015 (Wellington: States Services Commission 2015).

To what extent does the central government ensure that tasks delegated to subnational self-governments are adequately funded?

10
 9

The central government enables subnational self-governments to fulfill all their delegated tasks by funding these tasks sufficiently and/or by providing adequate revenue-raising powers.
 8
 7
 6


The central government enables subnational governments to fulfill most of their delegated tasks by funding these tasks sufficiently and/or by providing adequate revenue-raising powers.
 5
 4
 3


The central government sometimes and deliberately shifts unfunded mandates to subnational governments.
 2
 1

The central government often and deliberately shifts unfunded mandates to subnational self-governments.
Task Funding
9
The New Zealand governmental system is highly centralized. Local government structures, which are lean and generally uniform, raise only about 5% of total government tax revenues. However, local autonomy in setting tax rates and bases is greater than in any other OECD country. The main source of local tax revenues is the so-called rates, which are taxes on real-estate holdings. At the time of writing, local governments had full discretion to set rates, subject to a general balanced budget requirement. Other revenue sources include user charges and fees. Local government officials have been lobbying central government for the right to raise revenue from additional sources, including road tolls and a gasoline tax. To date, their lobbying has been largely unsuccessful, although the Transport Minister recently announced that Auckland would be given the right to derive transport income by way of a 10 cent per liter fuel tax. There are no block grants from central to local government, but the central government contributes funding to specific local government functions, in particular transportation as well as road construction and maintenance. For example, a major new city rail link in Auckland is being funded by a combination of local and central government money. The National government has reformed the Local Government Act with the aim of limiting local services more to their core tasks to keep costs under control.

Citations:
Local Government Act 2002 Amendment Act 2012 (Wellington: The Government of New Zealand 2012).
M. Reid, J. McNeill and C Scott, Local Government, Strategy and Communities, Wellington, Institute of Policy Studies, 2006.

To what extent does central government ensure that subnational self-governments may use their constitutional scope of discretion with regard to implementation?

10
 9

The central government enables subnational self-governments to make full use of their constitutional scope of discretion with regard to implementation.
 8
 7
 6


Central government policies inadvertently limit the subnational self-governments’ scope of discretion with regard to implementation.
 5
 4
 3


The central government formally respects the constitutional autonomy of subnational self-governments, but de facto narrows their scope of discretion with regard to implementation.
 2
 1

The central government deliberately precludes subnational self-governments from making use of their constitutionally provided implementation autonomy.
Constitutional Discretion
6
There is a clear legal framework for local government autonomy, consisting of the Local Government Act 2002, the Local Electoral Act 2001 and the Local Government (Rating) Act 2002. In addition, the comprehensive reform program, “Better Local Government,” was put into action during the review period, culminating in the Local Government Act 2002 Amendment Act 2014. The Amendment Act became law in August 2014. According to the Department of Internal Affairs, the act includes, among others things: changes in regard to what development contributions can be used for; more collaboration and shared services between local authorities; new requirements for infrastructure strategies and asset management planning; elected members to use technology to participate in council meetings, rather than attending in person; local councils to disclose information about their rating bases in long-term plans, annual plans and annual reports; and discloses risk management arrangements for physical assets in annual reports. In addition, the act includes provisions that enable the Local Government Commission to establish local boards as part of new unitary authorities, and in existing unitary authorities. There is no de facto infringement of this scope. Local governments do not enjoy constitutional status, as they are creatures of statute. As noted already, local governments in New Zealand are unusual in terms of their relatively narrow task profiles and their inability to tap into other commonly used sources of subnational revenue such as sales and/or income taxes. Local governments therefore raise a relatively large proportion of revenue from rates and charges; and given concerns about rating levels, they are fiscally constrained from expanding their roles and functions.

Citations:
Department of Internal Affairs, Better Local Government: http://www.dia.govt.nz/better-local-government (accessed November 30, 2015).
Local Electoral Act 2001 (Wellington: The Government of New Zealand 2012).
Local Government Act 2002 (Wellington: The Government of New Zealand 2012).
Local Government Act 2002 Amendment Act 2014 (Wellington: The Government of New Zealand 2014).
Local Government (Rating) Act 2002 (Wellington: The Government of New Zealand 2011).

To what extent does central government ensure that subnational self-governments realize national standards of public services?

10
 9

Central government effectively ensures that subnational self-governments realize national standards of public services.
 8
 7
 6


Central government largely ensures that subnational self-governments realize national standards of public services.
 5
 4
 3


Central government ensures that subnational self-governments realize national minimum standards of public services.
 2
 1

Central government does not ensure that subnational self-governments realize national standards of public services.
National Standards
7
It is not central government as such but a dense network of agencies that are involved with the development and monitoring of local government. This includes the Minister of Local Government, the Department of Internal Affairs, the Local Government Commission, Local Government New Zealand (representing local councils on the national level), the Office of the Controller and Auditor General, the Office of the Ombudsman and the Parliamentary Commissioner for the Environment. Their roles range from strategic development, policy formulation, regulation and monitoring, to handling complaints about the activities and operation of local government. At the end of 2013 a comprehensive reform program, “Better Local Government,” was introduced, whose provisions are part of the Local Government Act 2002 Amendment Act 2014. In June 2016, the Local Government Act 2002 Amendment Bill (No 2) passed its first parliamentary reading, which includes the Better Local Services reforms. The bill continues the general trend of increasing central government scrutiny and control over local government. These reforms have been the subject of criticism, especially in Auckland with its relatively new “super-city” structure and population of 1.4 million. However, smaller municipalities have also been critical of the reforms, describing them as being undemocratic, especially the “draconian” powers granted to the Local Government Commission. Smaller municipalities argued that they could be forced amalgamate their services. In an open letter to then-Prime Minister John Key, Invercargill Mayor Tim Shadbolt called the legislation the “crushing of local government democracy and seizing control of their assets bill.”

Citations:
Local Government Act 2002 Amendment Bill (No 2). NZ parliament. https://www.parliament.nz/en/pb/bills-and-laws/bills-proposed-laws/document/00DBHOH_BILL69266_1/local government-act-2002-amendment-bill-no-2 (accessed 7 October, 2016).
Woolf, Amber-Leigh, 2016. Minister says Better Local Services reforms not a ‘threat to democracy’ or forced amalgamation. Stuff.co.nz. 3 August 2016 http://www.stuff.co.nz/national/politics/82752225/Minister-says-Better-Local-Services-reforms-not-a-threat-to-democracy-or-forced-amalgamation.

Adaptability

#4

To what extent does the government respond to international and supranational developments by adapting domestic government structures?

10
 9

The government has appropriately and effectively adapted domestic government structures to international and supranational developments.
 8
 7
 6


In many cases, the government has adapted domestic government structures to international and supranational developments.
 5
 4
 3


In some cases, the government has adapted domestic government structures to international and supranational.
 2
 1

The government has not adapted domestic government structures no matter how useful adaptation might be.
Domestic Adaptability
8
New Zealand has ample experience in drastically restructuring its public sector and reforming policymaking to adapt to new challenges. Major reforms were accomplished from the mid-1980s to the mid-1990s. However, this was done under a majoritarian regime, based on a first-past-the-post electoral system. Part of the reform package involved the change to a proportional electoral system, a move that was initiated by the voting public rather than the governing elite. Today, given the existence of a multiparty system and minority government, radical reform is much more difficult to achieve. In retrospect, institutional reforms delivered somewhat less than was anticipated and have at times been disruptive. The government at the time of writing was concerned with driving efficiency and performance improvements into the system, and was seeking to accomplish this with relatively limited emphasis on a major restructuring of government agencies.

To what extent is the government able to collaborate effectively in international efforts to foster global public goods?

10
 9

The government can take a leading role in shaping and implementing collective efforts to provide global public goods. It is able to ensure coherence in national policies affecting progress.
 8
 7
 6


The government is largely able to shape and implement collective efforts to provide global public goods. Existing processes enabling the government to ensure coherence in national policies affecting progress are, for the most part, effective.
 5
 4
 3


The government is partially able to shape and implement collective efforts to provide global public goods. Processes designed to ensure coherence in national policies affecting progress show deficiencies.
 2
 1

The government does not have sufficient institutional capacities to shape and implement collective efforts to provide global public goods. It does not have effective processes to ensure coherence in national policies affecting progress.
International Coordination
8
Given New Zealand’s small population and geopolitical isolation, it has been surprisingly successful at participating proactively in many international organizations and in the international coordination of joint reform initiatives. Major areas include issues regarding the Antarctic region, disarmament and proliferation, environmental protection and human rights. New Zealand is a member of the Asia-Pacific Economic Cooperation (APEC) forum, the Commonwealth, the OECD, the United Nations and the World Trade Organization. Free trade is a central preoccupation within foreign relations, especially in the Asian region. Having signed the Association of Southeast Asian Nations (ASEAN)-Australia-New Zealand agreement and a bilateral agreement with Malaysia and Korea in recent years, current efforts are directed at deepening its “comprehensive strategic partnership” with China and continuing negotiations with India and Russia. In June 2017, New Zealand launched free trade agreement negotiations with the Pacific Alliance (Chile, Colombia, Mexico and Peru). New Zealand has been an enthusiastic supporter of the Trans-Pacific Partnership (TPP) Agreement. The government reinforced its willingness to conclude the negotiations until 2020 even after the election of Donald Trump to the office of U.S. president and the U.S. rejection of further negotiations. After strongly opposing aspects of the TPP Agreement, the new Labour/NZ First successfully negotiated several amendments to the Agreement before giving its endorsement. Negotiations on a Partnership Agreement on Relations and Cooperation (PARC) between New Zealand and the European Union (EU) were concluded in July 2014. The agreement is a platform for pursuing New Zealand’s ambitions for a free-trade agreement with the EU. This, however, might be more complicated after the United Kingdom’s Brexit decision. New Zealand is a member of the United Nations Security Council during the 2015 to 2016 term. It has been very active in campaigning for a humanitarian response to the situation in Syria.

Citations:
Annual Report 2014/2015 (Wellington: Ministry of Foreign Affairs and Trade 2015).
Strategic Intentions 2015-2019 (Wellington: Ministry of Foreign Affairs and Trade 2015).
Trevett, Claire, 2016. Claire Trevett: New Zealand brought new perspective to U.N. Security Council but no major breakthrough. New Zealand Herald. 25 August 2016 (http://www.nzherald.co.nz/politics/news/article.cfm?c_id=280&objectid=11699941).
Editorial: Brexit begins and NZ has work to do. New Zealand Herald. 30 March 2017 (http://www.nzherald.co.nz/opinion/news/article.cfm?c_id=466&objectid=11827847) (accessed January 16, 2018).

Organizational Reform

#1

To what extent do actors within the government monitor whether institutional arrangements of governing are appropriate?

10
 9

The institutional arrangements of governing are monitored regularly and effectively.
 8
 7
 6


The institutional arrangements of governing are monitored regularly.
 5
 4
 3


The institutional arrangements of governing are selectively and sporadically monitored.
 2
 1

There is no monitoring.
Self-monitoring
9
Following from the change to a proportional electoral system in 1996, institutional arrangements in the core executive as well as executive-legislative relations and democratic decision-making have been regularly and effectively monitored. Although the first government under the new electoral system was a majority coalition, subsequent governments have lacked a parliamentary majority. Rather than assembling a formal coalition, the recent National government followed the example of its immediate predecessor, the Labour government of Helen Clark, by keeping its support parties at arm’s length from the cabinet. All 20 cabinet seats were held by National members. Two of the three support parties (United Future and the Maori Party) were given ministerial portfolios outside of cabinet but within the larger executive. The only member of parliament from the Act party, a newcomer to parliament, was given the title of undersecretary (he declined a promotion to ministerial level in a December 2015 cabinet reshuffle). While each party was committed to providing the government with confidence and supply, it was free to oppose the government on all policy matters that lay outside its portfolio responsibilities. This governing arrangement had the dual benefit of limiting the influence of the small support parties while providing them with the ability to retain their separate political and electoral identity.

In contrast, the new Labour/NZ First government is a coalition, with Labour holding 16 of 20 cabinet seats, including the positions of prime minister and finance minister, and NZ First holding four, including deputy prime minister. To ensure it has a legislative majority, the new government secured a confidence and supply agreement with the eight-member Greens. In return, the Greens received three ministerial posts outside of cabinet.

One area of particular interest is the performance of the reformed electoral system. The Electoral Commission regularly commissions surveys to ascertain satisfaction with the way elections are organized, what the barriers to voting are and how to address these barriers. In the context of the general election in 2011, a referendum was held on whether to retain or replace the electoral system. A majority of 56% opted to keep the mixed-member proportional (MMP) system.

Citations:
Colmar Brunton, Voter and non-voter survey report, Auckland and Wellington: Colmar Brunton New Zealand 2012.
Elections New Zealand: Results of the Referendum: http://www.elections.org.nz/events/past-events-0/2011-referendum-voting-system/results-referendum (accessed October 9, 2014).
Ministerial List: http://www.dpmc.govt.nz/cabinet/ministers/ministerial-list (accessed October 24, 2015).

To what extent does the government improve its strategic capacity by changing the institutional arrangements of governing?

10
 9

The government improves its strategic capacity considerably by changing its institutional arrangements.
 8
 7
 6


The government improves its strategic capacity by changing its institutional arrangements.
 5
 4
 3


The government does not improve its strategic capacity by changing its institutional arrangements.
 2
 1

The government loses strategic capacity by changing its institutional arrangements.
Institutional Reform
9
Major adaptations to the multiparty system and coalition government occurred in the mid- to late 1990s. An effective framework is in place with the Cabinet Manual, which has begun to attract more and more interest from other jurisdictions. Cabinet office circulars are used for minor changes. Particularly after the change of government in 2008, a number of such modifications were made. One area of institutional change that has been largely neglected has been the reform of parliament’s conventions and opportunities for public engagement.

Citations:
Cabinet Manual: http://www.cabinetmanual.cabinetoffice.govt.nz/3.28 (accessed October 30, 2015).
Grant Duncan, 2014: New Zealand’s Cabinet Manual: How Does It Shape Constitutional Conventions?, Parliamentary Affairs 2015, 68:4, 737-756.
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