Submission to: Finance and Expenditure Committee, NZ Parliament
From: Kevin Hague
Date: 17 June 2025
Re: REGULATORY STANDARDS BILL
Recommendation and Summary
This Bill is without merit and should be rejected in its entirety.
Wrapped up in a cocoon of rhetoric about improvement and transparency this Bill instead is intended to be, and is, a major enabling step for politically-motivated deregulation, the placement of the ACT Party’s extreme libertarian values at the heart of what remains and a substantial concentration of power in the Minister for Regulation.
Problem not established
While any system – including ours in some particular areas – is capable of improvement, it is important to understand that the New Zealand regulatory system is already held to be amongst the best in the world. A continuous quality improvement approach has seen multiple initiatives put in place to improve it further, including Regulatory Impact Statements, the Legislation Act and the Legislation Design and Advisory Committee, alongside the pre-existing functions of PCO and the Cabinet Manual and the scrutiny of the Regulations Review Committee and the judiciary through e.g. judicial review. Thus a problem requiring a solution has not been made out.
Alternatives not considered
To the extent that any problem exists, it is a smaller problem than it was 20-25 years ago, when the ACT Party first started pushing versions of this Bill. Neither the ACT Party nor the responsible Minister has addressed alternative solutions to the claimed problem. Yet the advice of Ministry for Regulation, in the Regulatory Impact Statement for the Bill, does not support the Bill, but rather notes that further development of the structures and processes already in place – and such improvement is already under way – would be both more effective and less costly than the approach set out in this Bill.
Misalignment of objectives and effect
The opposition to the Bill by MfR echoes the opposition by those officials from MBIE and Treasury who conducted the detailed scrutiny of earlier versions of this Bill. This massive discrepancy between the ambitions of a Minister and the objective and comprehensive advice from officials has occurred because officials have assessed the Bill against its stated objectives, but these are not, in fact, the Minister’s objectives at all.
Unforeseen and unintended consequences
Critique of earlier versions of this Bill has noted that they present a very high risk of unforeseen and unintended consequences. For example, the Bill sets out some principles of the ‘rule of law’. Some of these duplicate existing statute or common law principles, some reflect a particular interpretation of existing principles and some existing principles are excluded. What will the Courts make of this? Are the versions of principles included in the Bill to be preferred over existing jurisprudence? Are principles included in the Bill to be considered more important than those that have not been? The Courts would have to work their way through these questions, fundamental to the rule of law, and until they do, nobody would know what the law is. Similar questions arise around the application of clauses related to property rights and takings – the Bill cuts across well-established existing law, meaning that nobody will know what the law is in these areas until the Courts have had the time necessary to work this out.
It seems irresponsible in the extreme for Parliament to pass legislation with effects that are unknown.
Bureaucracy and cost
The biggest immediate effect of the Bill seems likely to be the establishment of a new layer of bureaucracy in the policy-making process. Across the entire sweep of central, regional and local government additional steps will now be required to be able to make regulation. This will make the entire system slower to respond to changed circumstances, less efficient and more expensive to operate. The Regulatory Impact Statement attempts an estimate of cost, but this is likely to be an underestimate because of the Bill’s far-reaching scope. No estimate is made by the responsible Minister or his Ministry of the value of any benefit, beyond hand-waving generalities. It seems likely, as analysis of previous versions of the Bill concluded, that the Bill may well cost more to implement than any value achieved.
Advancement of private and corporate interests over public good
The ‘standards’ that the Bill proposes are a curious and selective mix of mostly already-existing requirements about process and specific new ideas about content of regulation. In seeking to constrain the content of regulation, the Bill seeks to usurp the sovereignty of Parliament. The content of regulation is properly in the domain of Parliament to determine. No doubt the ACT Party would say that the Bill won’t affect the ability of future parliaments to make any decisions they choose, but this claim of having no effect is rather belied by their dogged campaigning for this Bill, despite its having been rejected on multiple occasions.
Of particular concern are those proposed ‘principles’ that elevate private and corporate property rights above others. The sole limitation on freedom, liberty and rights (including property rights) that regulation is necessary to protect the freedom, liberty or property rights of another person introduces a very high legal bar. To establish that regulation that limits freedom, liberty or rights (including property rights) passes the threshold one would need to establish that the protection of freedom, liberty and property rights of other people cannot be achieved without such regulation. Risks seldom eventuate all of the time, so in most cases control of the risk is not necessary – acceptable outcomes are achieved without its being controlled. For example, most houses built from the mid-1980s to the mid-2000s did not create toxic mould problems for their occupants, so regulation to prevent leaky buildings was arguably not necessary. If someone drives their car at 60kph through a suburban neighbourhood, it will almost always not result in injury or death. Can a lower speed limit be said to be necessary? On the day before the Pike River mine disaster, miners went underground with the same poor regulation and enforcement that existed a day later, but nothing happened. “Necessary’ is a very high bar.
This limitation in Cl.8(b) is constrained to personal (individual) property rights and freedoms, but this reflects a particular ideological view of the world. More generally society (and specifically the law and economics) recognise public goods (broadly benefits that cannot be meaningfully ascribed to identifiable individuals, and which would not be reduced by people using them) and collective rights. An example of a public good might be the eradication of malaria-carrying mosquitoes in a geographic area. Each individual’s benefit is hard to quantify, and no matter how many people were in the area, they would all benefit. An example of collective rights might be the right to use a language or practise a culture.
Environmental and biodiversity protection, or action on climate change are also topics on which most people would support the existence of regulation, but individualised human protection is not the purpose of such regulation and it would fail the test in Cl.8(b).
Clause 8(c) further extends the entrenchment of private and corporate property rights and freedom of action above eg the public good, public health, collective rights, climate change action and environmental protection. I am aware that the Committee will receive expert submissions on this issue, and I have chosen to rely on these expert views.
Te Tiriti o Waitangi
I suspect that the Committee will receive a large number of submissions from people principally concerned that one of the intents of the Bill is that Te Tiriti o Waitangi, now a significant and growing dimension to constitutional and other law, should be reconsigned to a “legal nullity” in law. They note that the ACT Party’s first attempt to do this in this parliamentary term was with the wildly misconceived “Principles of the Treaty of Waitangi Bill” and that this current Bill appears to be a second go.
The absence of any reference at all to Te Tiriti, in a Bill with this broad scope, can only be interpreted as an attempt to sideline it (and over time to exclude it) from our law. I argue that this is wrong in law. In his memorable verbal submission on the previous Bill, Hon. Chris Finlayson said that it was possible to legislate that the earth is flat, but that this would not make it so. Whether or not the ACT party likes it, Te Tiriti was signed, it does have binding force, and it has profound implications for our constitutional and other law. More than this, surveys by the Human Rights Commission in 2023 and 2024 demonstrate clearly that a growing majority of New Zealanders both think that Te Tiriti is an important aspect of our national identity and also believe that it is important that Te Tiriti is honoured. It may be that ACT’s intentions are purely performative – to seek to make political capital from a minority of the population by appealing to racist sentiment – but the Committee should be aware that this aspect of the Bill is rejected by the majority, who do not approve of ACT’s divisive tactics.
The eye of Sauron
Hon David Seymour inherited this Bill from a previous leader of the ACT Party, Hon. Rodney Hide. He attempted unsuccessfully to have a previous (very similar) version of this Bill passed as a Member’s Bill. He is the responsible Minister for this Bill. The Ministry for Regulation was established pursuant to ACT’s negotiation priorities in the formation of government. The Ministry reports to him. He would appoint the Regulatory Standards Board. They would also report to him. Through the Ministry and the Board Hon. Seymour would have extraordinary power to reach across into all other aspects of government to require information and intervene in process. Through these mechanisms Hon. Seymour will also have the power to issue “guidance” on interpretation of the Act, should this Bill advance into law. Outside of a state of national emergency it is hard to think of another example of such wide-ranging power concentrated in one person, and implementing law on which he so clearly has a weighted and ideological agenda.
The accountability of the Board to the Minister, rather than to some independent entity is particularly concerning. The Board will be exercising a quasi-judicial role, and so its accountability to the Executive arm of government shifts the relationship between the Judiciary and the Executive. The Board will also take on a role currently performed by the Regulations Review Committee. In this case the Executive will be taking a role of the Legislature.
Similarly, the provision of “guidance” by the Executive, particularly in the initial period before which the Courts have established how this Bill, if enacted, intersects with already existing law would effectively usurp the role of the Courts in interpreting the meaning of legislation. It would be a brave official to disregard the guidance they received from David Seymour’s representatives, believing that the Courts would hold that the law meant something different.
Chilling effect
The Bill does not directly require regulation to comply with the ‘standards’ it sets but instead sets out to make life difficult for regulators if their regulation does not. The intent is to shift behaviour of regulators so that regulation does comply, but without requiring it to do so. The risk that this poses is that the ‘standards’ in the Bill become de facto requirements, without having been subjected to the scrutiny or special requirements for constitutional change.
The LDAC submission on the discussion document also suggests that a related effect is to shift perception of what good regulation looks like, so that regulation that doesn’t comply with the prescription becomes increasingly hard to advance.
This chilling effect will operate particularly in the areas of regulation already mentioned. Regulation to protect the environment, public goods and collective rights or in line with Te Tiriti will become increasingly more difficult.
Interpretive backdrop
There are many questions that come before the Courts that require legislative interpretation. In some cases the thinking behind such interpretation has become well-established, but in novel cases the Court will tend to look beyond the wording of statutes to parliamentary debate, to infer the meaning Parliament intended, and to other statutes and to te Tiriti for guidance as to meaning. While Clauses 24, 25 and 26 mean that the ‘standards’ don’t have any direct legal effect they absolutely will have an effect when the Courts are interpreting legislation. The Courts will be entitled to look, and will look, to this law, if enacted, to draw conclusions about Parliament’s intentions in balancing rights and freedoms, compensation, levy setting and so on.
Introduction
Submitter – I am a retired, Pākehā man living in Greymouth, on the South Island’s West Coast. My career has primarily been in business, the health sector and conservation. I am an acknowledged expert in public health and health services management. I was a Member of Parliament from 2008-2016. I hold several official positions, as the Chair of the Public Health Advisory Committee, Deputy-Chair of the Board for Te Hiringa Mahara (the Mental Health & Wellbeing Commission) and as Group Controller for Civil Defence Emergency Management for the West Coast. While this submission is informed by my experience in those roles, it is made in my personal rather than official capacity.
I am not a lawyer and appreciate that there are likely to be aspects and implications of the Bill that I have not fully understood. That said, I am an experienced legislator and have almost fifty years of working with the law through my various roles. My own qualifications are in geophysics, mathematics, Scandinavian studies and, at post-graduate level, health management, health economics and epidemiology.
On 19th November 2010 I was the MP who lived closest to the site of the Pike River coal mine, and I knew a number of the 29 men who lost their lives. I made it a mission of mine to ensure that the causes of the disaster were uncovered, that steps were taken to ensure this could never happen again, to hold those responsible accountable; and to bring home the men to their families. Day after day in Parliament I used the tools available to me to pursue these goals. What became apparent was that in the early 1990s, at a time when this country had a government with a zeal for deregulation and unfettering businesses, the laws, regulation and its enforcement of occupational health and safety in general, and underground coal mining in particular, were relaxed.

One day, having noticed my parliamentary campaign, a coalmining insider gave me this picture. It is a picture that should never have existed, because it was taken on a cellphone inside the Pike River mine, and cellphones should not be allowed underground because of their potential to create a spark that might ignite methane. It took a while to understand what I was seeing in the picture. It is the beginning of a 200 metre vertical (at one point more than vertical) ladder that led up through a ventilation shaft to the surface. The ladder had never been used in training, and was considered to be extremely difficult to use and impossible in an emergency. Yet it was the only emergency exit from the Pike River mine. I find it – and I hope you will too – a chilling reminder of what happens when private property interests are unfettered to pursue their own goals without being constrained by regulation to protect human rights, the public good, the environment, collective rights and Te Tiriti o Waitangi. There were a very large number of other corners cut in that mine, all the direct consequence of the deregulation agenda of the Government in 1992. Lest there be any thought that compromising workers’ health and safety is not the intention of the RSB, the ACT Party has helpfully spoken publicly about too much economic value being placed on human life and its intention to remove ‘burdensome’ occupational health and safety requirements. They want to go back there.
The Process – I appreciate that it must now be enormously difficult for parliamentary committees to properly consider public and stakeholder feedback on Bills in circumstances where there are very large numbers of submissions. One might venture to suggest that the consideration of public feedback by select committees has only functioned adequately before this because almost everyone in the public did not participate in the process – itself a major shortcoming of democratic process. This hugely increased public participation should be expected to have limitations. For example, many will think of the process as a referendum vote, or like signing a petition: a simple binary choice about a proposed Bill. Such submissions are useful as indicators of extent and depth of feeling. Others may wish to express a view but lack the specialised vocabulary or understanding of the parliamentary system or process to feel confident to do so without assistance. Submitters like these may endorse another submission, use a template or submission generator or artificial intelligence to make their feedback.
In this environment I understand the temptation to use artificial intelligence to manage the task of submission analysis. I concede that it may have a role to play, but this role ought to be augmentation of fully human processes. The Minister in charge of this Bill has dismissed the near total opposition to the idea of it in feedback on the discussion document over the Christmas/ New Year holiday period as generated by bots and lacking any worthwhile arguments. I find his condescending dismissal of the public to be inappropriate and offensive. His hubris and contempt for the public, alongside the role this Bill sets out for him, is one of the reasons that I oppose it so strongly. I was one of the submitters on the discussion document and put considerable thought into making my feedback on it. I did not use anyone else’s submission guide or generator or artificial intelligence and have not done so in compiling this submission.
I object to the Committee’s reported intention to use artificial intelligence to analyse this submission. I put significant thought into how my arguments are expressed, the evidence I offer alongside them and their sequence because I wish to communicate with members of the Committee as effectively as possible. The use of artificial intelligence will flatten all of this, meaning that the Committee will not see my full argument. I believe this to be improper. The second reason for my objection is that artificial intelligence will almost certainly not capture the experience and expertise of the submitter, which human beings would have used to evaluate and weight the arguments made in a submission, and to discern arguments made on their merits from arguments made out of self-interest. The Committee may well be able to do this for submissions selected for oral submissions, but more generally these important features will be lost. I believe that it is a citizenship right for every person to have their unique voice and perspective taken into account in this process. Unless artificial intelligence is only used to augment human submission analysis then the process will not honour this right.
The Bill – Since at least the 1990s there have been expressions of concern about the quality of law, and regulation more generally. These concerns have led to multiple strands of reform and quality improvement, including, for example, the introduction of Regulatory Impact Statements and the Legislation Act. The nature of the quality improvement cycle is that it is a continuous process: no matter what improvements have been made, further improvement is always possible. Thus, even now reforms of the public service, and its culture and improvements to the Legislation Act are currently in train.
Apparently in ignorance of these processes, or at least disregarding them, the ACT Party is now making its fourth attempt to advance more or less the same Bill. The Business Roundtable was infamous for not really being a roundtable at all, reflective of the broad spectrum of business opinion, but rather representative of a narrow, libertarian strand of thinking within the business community. In 2001, Dr Bryce Wilkinson, for the Business Roundtable, produced a paper called “Constraining Government Regulation” proposing a Regulatory Responsibility Bill. The title of his paper is instructive: in the four subsequent attempts to advance a bill along the lines he suggested the focus has not been on improving regulation, but rather on limiting it. Minister Seymour dresses up his Bill as aiming for better regulation, but – as his First Reading speech revealed – his actual twin objectives are for deregulation and for what remains to reflect his own libertarian values.
The first Bill seeking to do this was Hon. Rodney Hide’s member’s bill, the Regulatory Responsibility Bill, introduced in 2006, although it’s worth also noting that the Government had rejected the idea of a regulatory responsibility bill in 1998, and that an attempt to elevate the status of private property rights – the Bill of Rights (Private Property Rights) Amendment Bill – had also been rejected by the House. Mr. Hide’s Bill was considered by the Commerce Committee, which reported back to the House in 2008, unanimously rejecting the Bill, but proposing that a taskforce was established to consider whether any change to the regulatory system should be considered.
189 submissions had been received, mostly opposed to the Bill. The advice to the Commerce Committee from MBIE officials did not support the Bill:
“Although legislation can have a role in providing a set of incentives for improving the quality of the regulatory environment, we have highlighted significant risks associated with the Bill that appear disproportionate to the magnitude and scope of current regulatory issues.”
A Regulatory Responsibility Taskforce was convened and, following its report, Hon. Hide introduced the Regulatory Standards Bill in 2011, and it was again referred to the Commerce Committee. The Committee made an interim report in 2011, having received 46 submissions, mostly opposed. The Bill was reinstated by the 50th and 51st Parliaments and was finally reported back in 2015. Again the Commerce Committee unanimously rejected the Bill and it did not proceed further.
On this occasion the departmental report was from Treasury, who advised that the approach taken by the Bill offered no clear advantage over other methods already available to improve regulation; that the Bill’s potential to induce behaviour change was low; that the Bill posed a high risk of unintended consequences; and the Bill’s potential for reducing cost was very limited.
Some notable submissions opposing the Bill were from the Regulations Review Committee, from Alex Penk of the Maxim Institute (who described it as a “wolf in sheep’s clothing”) and Dr. Richard Ekins and Chye-Ching Huang, who in a comprehensive critique of the Bill called it “hostile to our democratic constitutional order”.
The third attempt to pass essentially the same Bill came with Hon. David Seymour’s member’s bill the Regulatory Standards Bill in 2021. This Bill was defeated at First Reading.
The critiques of these earlier Bills were that they:
- Sought to address a problem that didn’t exist or was, at least, exaggerated;
- Did not take into account other approaches already being made to address perceived problems;
- Were not, or at least had not been demonstrated to be, the best option available to the House to further address any perceived problems;
- Were likely to be ineffective in improving the quality of regulation;
- Were heavily duplicative of mechanisms that already existed and in some cases introduced measures or requirements that were slightly different, creating confusion and greater problems of opacity;
- Were difficult to understand and inaccessible to the public;
- Were likely to incur costs similar to or greater than any cost savings they made;
- Posed a high risk of unintended consequences; and
- Would change our constitutional arrangements, without proper process for doing so, by altering the roles and scopes of Parliament, the Executive and the Judiciary and the relationships between them.
All of these critiques of the earlier versions of the Bill apply to this one. Indeed, as processes for regulatory improvement have been instituted and developed further over all governments of the past 20 years, usually with broad parliamentary support, any potential benefits of the Bill are now substantially smaller than they were in 2006, and the balance of risks against potential benefits has shifted even further against this approach.
The ACT Party’s persistence in promoting versions of this same Bill, in the face of consistent and deep opposition from officials and experts is indicative of the importance of the Bill to ACT’s extreme libertarian agenda. This is not a motherhood and apple pie measure but one that represents an ideological lurch towards oligarchy.
Commentary on Particular Clauses
Cl. 3(1)(a)(i) This clause states that a purpose of the Bill is to “promote the accountability of the Executive to Parliament for the development of high quality legislation”. The responsible Minister, Hon. Seymour, has made it clear in his First Reading speech that this is not his purpose, and the Committee should reflect that this Bill is designed not to achieve its stated purpose, but rather to minimise the amount of regulation and to elevate the status of private property rights. This is particularly germane given the extreme concentration of Executive power in his office intended by the Bill.
Cl. 5 This clause does not include a definition of the term “regulatory system” or of “regulatory management system”. Both these terms appear in the Bill relating to the scope of some particular functions, but without definition they are capable of a broad range of interpretation. What actually is intended?
Clause 5 should also include definitions of “responsible regulation” and “responsible regulations” as these terms are used in the Bill to refer to selective and libertarian regulation and regulations, respectively, rather than their normal English language meanings.
Cl.8 generally There is a curious inconsistency in the drafting of the ‘principles’. In some cases something that looks like a principle is set out, but in Cl.8(a), Cl.8(d), Cl.8(i) and Cl.8(j) a construction using “the importance of” is employed, rendering meaning less certain. For example, the principle set out in Cl.8(a)(i) is:
“the importance of maintaining consistency with the following aspect of the rule of law: the law should be clear and accessible”; rather than:
“the law should be clear and accessible”.
There appears to be no consistent reason why this construction has been used for these clauses. Is there one, or is it just sloppy drafting?
Cl.8(a) There is substantial legal scholarship behind the idea of “rule of law” – attempting to define the characteristics of a country that is governed through the law, rather than by arbitrary power.
The ideas set out in Cl.8(a) don’t appear to relate to the “problem” that the Minister has set out, so it is hard to understand why these are included at all. Certainly if the intention were to incorporate in Cl.8 EVERYTHING that all statute and other regulation needed to take into account, then being lawful would be one of those things. But if this were the motivation for inclusion, then a general requirement to adhere to the principles of the rule of law as determined by the judiciary would be the wiser course of action. Jurisprudence is also dynamic. Increasingly the common law is incorporating Tikanga Māori and the Crown’s obligations under Te Tiriti o Waitangi. A list of principles derived from one generated overseas, and which also seeks to fix legal understanding to one particular point in time will inevitably cause problems.
The superposition of these black letter principles over the existing common law will also create confusion. Should the narrower formulation of a principle set out in this Bill carry more weight than the more well-rounded principle already in law? Should principles included in this Bill carry more weight than principles of the rule of law that have not been included?
In 2010, the English law lord, Lord Bingham set out eight characteristics of ‘rule of law’, from which the ACT Party appears to have selected the ones it likes:
- “The law must be accessible and, so far as possible, intelligible, clear, and predictable”;
- “Questions of legal right and liability should ordinarily be resolved by application of the law, and not the exercise of discretion”;
- “The laws of the land should apply equally to all, save to the extent that objective differences justify differentiation”;
- “Legal protection of such human rights as, within that society, are seen as fundamental”;
- “Means must be provided for resolving, without prohibitive cost or inordinate delay, bona fide civil disputes which the parties themselves are unable to resolve”;
- “Ministers and public officers at all levels must exercise the powers conferred on them reasonably, in good faith, for the purpose for which the powers were conferred, and without exceeding the limits of such powers”;
- “The adjudicative procedures provided by the state should be fair”; and
- “Compliance by the state with its obligations in international law.”
Lord Bingham’s list itself is not exhaustive. Behind each of these principles is a mountain of jurisprudence with which regulation ought to comply. Yet even his summary list has been cherrypicked from to draft this Bill. One notes, in particular, that Cl.8 fails to include Bingham’s limitation in his third principle, and the exclusion of protection for human rights (Bingham’s fourth principle) and compliance with international legal obligations (Bingham’s eighth principle). These exclusions are indicative of the highly ideological drafting of this Bill.
One small further note: while the Subpart is titled “Principles of responsible regulation” and Cl.8 begins on this basis, the sub-clauses, without exception, refer only to legislation. I assume this is just sloppy drafting.
Cl.8(a)(iii) For the most part I will leave the dissection of the proposed rule of law principles to legal experts but I do wish to comment on ‘equality before the law’. I have already noted that the Bill’s proposed wording excludes Bingham’s protection of different treatment for objective differences, but I also want to draw the Committee’s attention to the work of nineteenth century legal theorist Prof Dicey, who set out the principle of equality before the law for the English legal system:
“Equality for all before the law. Every person no matter their rank or condition is subject to the ordinary law. This excludes the idea of any exemption of officials or others from the duty of obedience to the law. We are all subject to the jurisdiction of the ordinary tribunals.”
The idea of equality before the law is that everybody is subject to it. The principle is not that the law cannot deal with different groups of people in different ways, as the ACT Party and the responsible Minister claim, and Bingham’s formulation makes it clear that the law can do this. Further, the international legal obligations our country has, and the domestic enactment of these, often requires that the law should provide for special treatment in order to reach just and equitable outcomes.
Cl.8(b) The whole of Cl.8 is a puzzling mash-up of ideas about the process used for creating and implementing regulation and its content or effect. As a general point it’s not unreasonable to agree some parameters for process, subject to the concerns already raised that parameters for this have, in fact, already been set through the common law, and setting new ones is very likely to either duplicate these or add complexity and confusion to interpretation.
However, the content of legislation (including regulation subordinate to primary legislation) is fundamentally a matter for Parliament, and it is inappropriate and fundamentally anti-democratic to seek to constrain this. Voters determine the strength of political parties in Parliament. This is the basis for the formation of government. Each of these political parties will have distinct values, beliefs and philosophies and policies that reflect these. The legislation that is enacted by a Parliament will reflect the combined ethos of those parties that voters have made the majority. This is the entire basis for democratic legitimacy of law. While this Bill does not directly bind the content of regulation it will place obstacles in the way of regulation that does not fit its preferences for content, and will indirectly drive change.
This is the necessary background to Cl.8(b). This sub-clause is the purest expression of libertarian philosophy imaginable, as espoused by Robert Nozick and others. Naturally the ACT Party is entitled to hold any beliefs that it chooses. It will be no surprise to anyone that they believe that individual liberty, security, freedom and property rights (and those of companies) are more important that the public good, the environment, biodiversity, human rights, collective rights and Te Tiriti o Waitangi. But it will come as a surprise to nearly everyone that any other party supports that position and is prepared to support the subversion of democratic process by making this minority values position a principle of “responsible” law-making and regulation.
Commentary from officials, experts and the public on earlier versions of this Bill has also contrasted the approach taken in the Bill with the Bill of Rights Act, with respect to justified limitations. While it is normal to recognise that all rights are qualified – there are contextual matters that may limit their applicability – the only qualification proposed in Cl.8(b), beyond the use of ‘unduly’, is if exercise of these rights MUST be limited to protect these same rights for another person (including a non-natural person like a company). The only MORE EXTREME formulation possible would be if these liberties and rights were not limited at all.
Even within this single limitation an extraordinarily high bar is set; a regulation can only compromise liberty, freedom, security or property rights if it is NECESSARY to provide for or protect these same liberties and property rights of some other person. This implies that if this objective can be achieved without the regulation, then the regulation does not comply. It is easy to think of examples where most people would agree regulation is appropriate but where such regulation would fail the test. Most buildings don’t burn down, so fire safety regulation can’t be justified under the test. Most people aren’t injured or killed even if other drivers are speeding or have unwarranted vehicles. The men who went to work in the Pike River mine the day before the disaster came home safely despite the inadequacy of occupational health and safety regulation and enforcement, so better ones weren’t necessary.
Cl.8(c) I know others with much more expertise than me will comment in detail on this provision, so I will limit my comments to noting that the basis for this clause is, as with Cl.8(b), ideological. It elevates private property rights (including those of corporates) above public good and seeks to fetter the actions of governments to act for the public good.
Cl.8(d) Adding to the dog’s breakfast nature of this Bill, this sub-clause seems to be entirely unnecessary. Again, it seems appropriate to ask what this list is actually for. Does it intend to codify everything that prospective regulation should do or not do, or is it a list of only some of the things? The more general principle here is surely that subordinate legislation and regulations issued pursuant to delegated authority need to comply with the law more generally, not just with this particular Section. If the regulation being considered is primary legislation, then it may be entirely legitimate for it to not to comply.
Cl.8(e)&(f) Again, these clauses seek to elevate private property (including financial interests) above legitimate policy decisions of democratically elected governments. Putting aside any differences (I can’t see any) between a fee and a levy, these clauses would appear to rule out any progressive measures (where those who can afford to pay more, do so). Another example, the tourist levy, used to fund conservation work and some infrastructure projects, is likely to only marginally comply with Cl.8(f)(i). Levies might also sometimes be used to discourage consumption of particular goods and services that pose risk to others without bans. Such use would not comply with the Bill.
While there is political debate about these examples and the general principles involved, a government with a democratic mandate is entitled to implement such policy. The ACT Party is attempting to prevent that debate, silence its political opponents and have its own ideological position used as the yardstick for assessing policy.
Cl.8(g)&(h) I will leave these to the experts to comment on. The clauses seem to me to be unnecessary duplication of already existing standards.
Cl.8(i) Note that this is one of the sub-clauses using the confusing “the importance of” construction, rendering meaning unclear. There is now an extensive and clear body of law determined by the Courts in relation to consultation – when is consultation necessary, reasonable limitations on that, who is to be consulted, what consultation should involve and – critically – the decision-makers’ attitude and response to feedback received. It is unnecessary to add extra requirements for responsible agencies to comply with what is already the law, but if this is to be done for a belt-and-braces reason, then a simple reference to the existing law would be safest and most appropriate. The approach taken in this Bill, of selecting some parts of the law and attempting to paraphrase them is either inept or yet another attempt to place a thumb on the scales. The sub-clause attempts to introduce a new test of “directly and materially affected” that is not the current law and makes it a matter of the Responsible Agency’s absolute discretion who it considers meets this test, also appearing to give it the choice of selecting “representatives” (as opposed to these being selected by those affected). The thumb on the scales interpretation is that this is an attempt to reduce public participation rights, which should certainly be resisted.
Cl.8(j) This sub-clause again sets out principles that are already in general use. To the extent that it’s useful, it’s unnecessary duplication.
Cl.8(k) Cost Benefit analysis or Cost Utility analysis can be useful tools in some circumstances. Typically, those circumstances will be ones where it is possible to reasonably quantify all benefits and costs or where the costs of different approaches to achieving the same benefit are being weighed up.
The large majority of public policy decisions do not fit either of these scenarios. The main reason is that some or all of the benefits are not quantitative in nature and it is not reasonable to assign quantitative measures for them. This is especially but not exclusively the case where some of the benefits are public goods. For example, a change to superannuation level is being considered. The cost of implementing the policy is easily estimated. It should be possible to measure the personal benefit of relief of material hardship. It is not possible to measure the real and important personal benefit of increased dignity. And it is not possible to measure the real and important public benefit of improved social cohesion.
A second limitation is that for CBA or CUA to be useful it needs to be comparable with the analysis undertaken for another policy, but there is substantial variability around methodology. In particular when cost and benefit are measured, which costs and benefits have been taken into account? Most analyses will include some indirect costs, but analyses vary as to how comprehensive this is, and whether opportunity costs have been taken into account: a stretch of road is in need of maintenance. A CBA might just look at the cost of labour and materials to do the job. Or it might also take into account the costs of wear and tear on tyres for road users depending on the option chosen. And it might go further to take into account the loss of productivity because of the road being out of action during the process, and/or the alternative benefits had the cash and labour been used for something else. Unless analyses are carried out in the same way they cannot be compared, and all will have limitations.
A third issue, arguably a particular case of the second, is around the treatment of future costs and benefits. How these are treated is a major factor in determining the apparent economic soundness of potential decisions and policy options. Future benefits are ‘discounted’, even if we can count them, meaning that policy options that produce (potentially bigger) benefits in the future are less favoured than those with immediate benefits. As many policy proposals are intended primarily for future benefit, use of CBA approaches can have a significant chilling effect, and unless a standardised approach is taken to discounting the comparison of CBA for different options will be meaningless (but appear objective and sciencey).
This is all to say that this sub-clause makes something very complex appear to be straightforward, and places yet another obstacle in front of prospective regulation when CBA will often not be desirable, useful or possible.
Cl.8(l) Fair enough. Except that these three dimensions will seldom all align. Once again something complex is being depicted as simple. In reality decision makers may well assess these criteria (and very likely others) but will then need to make expert judgments.
Cl.15(1)(a) The phrase ‘regulatory system’ is capable of a range of interpretations, but is not defined in the Bill. As the principles in Cl.8 exclusively relate to legislation it seems reasonable that the Bill should be clear about terms like this. Is the ‘regulatory system’ actually just legislation, or are we expected to infer something else from it?
Cl.16(2) A tiny point, but this is very odd drafting.
Cl.24(1) I defer to experts on the implications of this sub-clause. It appears from their public statements that the proponents of the Bill in the ACT Party intend that this sub-clause has been inserted to be able to argue that the ‘principles’ in Cl.8 do not actually bind future governments, but I read it as also meaning that (a) anyone can legally disregard what the Bill (if enacted) says they have to do; and (b) the Courts’ ability to scrutinise actions taken pursuant to the Bill (if enacted) may be limited.
Cl.27 There is nothing to stop Ministers providing guidance to the public service currently. Indeed, this is something that is done relatively frequently in both formal (such as a Cabinet Circular) and informal (such as discussion with chief executives) ways. Notwithstanding Cl.8(g) where the principles indicate that the Courts remain the correct channel for statutory interpretation, this Clause gives some of these same powers, in respect of this Bill (if enacted) to Ministers. There are a couple of obvious problems with this. First, the Executive rather than the Judiciary would be interpreting Parliament’s intention. The example given in the Bill around consultation requirements is a good one, as it is clearly an issue that has generally been adjudicated by the Courts – the Minister’s intention that he will now take this role represents a reduction of the Executive’s accountability. Second, save for the involvement of the Attorney-General, this concentrates even greater power into one point of failure: the Minister for Regulation.
The compromise of accountability is also evident in the wording around guidance. It’s perhaps reasonable for the Executive to give advice to itself on recommended best practice. But the use of “expectations” suggests that the intent is that the public service will be accountable to these Ministers for compliance with the matters set out in Cl.27. Given that Cl.23 limits chief executives’ accountability to their own Ministers for some of these, Cl.27 suggests an attempt both to shift power from the judiciary to the Executive and an attempt to concentrate power withing the Executive.
Subpart 7 – Regulatory Standards Board I will deal with this as a whole, rather than selecting individual clauses. The overall functions of the proposed Board largely duplicate functions that currently exist through judicial review (conducted by the Judiciary) and the Regulations Review Committee (an entity subsidiary to Parliament). Yet the Board would be part of the Executive. In other words, the overall effect of Subpart 7 would be to shift power that currently sits in the Judiciary and the Legislature into the Executive.
While some of the ACT Party rhetoric around the Bill talks about the proposed Board as ‘independent’ it is not set up to be an independent entity in the Bill, and nor is it required by the Bill to act independently. Indeed, the Bill is written to make the Minister for Regulation (rather than Cabinet) solely responsible for appointing members of the Board, and the Board to be accountable to the Minister.
The duplication of function is not demonstrated to be necessary, but the constitutional change to concentrate power in the Executive and, especially, the Minister for Regulation, is consistent with other parts of the Bill.
The Bill applied to itself
I am certain that the Committee will receive other submissions that more comprehensively gauge the extent to which this Bill complies with what it claims to be ‘standards’ or ‘principles of responsible regulation’, so I confine my analysis here to the following, non-exhaustive list.
| Clause | Principle | Compliance |
| 8(a)(i) | Clear and accessible | Bill is often clumsily drafted, capable of multiple interpretations and contains considerable unnecessary duplication or complication of existing law that will require further jurisprudence to understand |
| 8(a)(ii) | No retrospective rights and duties | Bill requires reviews of existing regulation |
| 8(a)(iv) & 8(g) | Independent, impartial judiciary | The Board represents the Executive currently assuming some of the functions of the Judiciary, and the Board will clearly not be independent |
| 8(a)(v) & 8(h) | Rules rather than discretion | The inclusion of principles that differ from existing law and the selective nature of the principles list WILL require considerable use of discretion until new jurisprudence is settled. The issuing of “guidance” including “expectations” by the Executive, and some of the functions intended for the Board are replacing the application of law with administrative discretion. |
| 8(i) | Appropriate consultation | Public consultation over the discussion document occurred with little publicity and over the Christmas/New Year holiday period. Arguably this failed some of the Court of Appeal’s established requirement s for consultation processes. Almost all of the submissions received opposed a Bill of this sort, many giving thought-out reasoning. While some of these are captured in the RIS, the Responsible Minister’s dismissal of any and all opposition to his Bill with insults and claims that it was generated artificially, make it clear that he was not considering the submissions received with an open mind – a further legal requirement from the Court of Appeal. |
| 8(j)(i) | Issue evaluation | Different and inconsistent attempts have been made to define the problem the Bill purports to be addressing. In the discussion document the Minister said it was low productivity; in his First Reading speech he said it was too much regulation and insufficient weight given to property rights, and the Bill itself doesn’t really attempt a problem definition but says the Bill aims to reduce the amount of unnecessary and poor quality regulation, suggesting a problem definition by inference. This haziness about what the problem is suggests that the vigorous promotion of the Bill by its supporters is about something else entirely. |
| 8(j)(ii) | Effectiveness of existing law | Expert advice, including from the Ministry itself, is that substantial progress has been and continues to be made to improve regulation. The Bill ignores all of this, with the exception of some references to the Legislation Act. |
| 8(j)(iii) | Public interest | This is not addressed at all by the Bill |
| 8(j)(v) | Winners and losers | No attempt is made to assess who would benefit and who would suffer detriment through the Bill |
| 8(k) | Benefits to exceed costs | The RIS makes a decent attempt to quantify likely direct costs. No real attempt is made to assess indirect or opportunity costs and there is no attempt at all to quantify benefits. It is clearly the case that it cannot be claimed that benefits exceed costs. Indeed, the overwhelming impression, including from experts, is that the Bill largely produces a massive increase in bureaucratic and costly process, without any evidence of gain. |
| 8(l) | Legislation to be the best response | Consistent advice from officials (for the Ministry for Regulation, Treasury and MBIE) as well as experts including LDAC and other legal and public scholars has concluded that this Bill is not the best response to the problem, to the extent that it exists. |
Conclusion
The Bill before the Committee is very poor in the extreme. It imposes unnecessary confusion, bureaucracy and cost. These are certain, while any benefit is speculative at best. The reason for this is that the real objectives for the Bill are ACT Party political ideology: deregulation, alignment of regulation with libertarian thinking and concentration of power in the Executive.

