Much of the State sector consists of agencies which are governed by appointed Boards reporting to Ministers. Crown entities are responsible for a significant proportion of government expenditure, and are major providers of public services to New Zealanders. Though the functions of these agencies have been placed at arms-length from Ministers, it is nonetheless important that they are engaged, and capable of engaging, in performance improvement and system change. Some progress has been made following the reform of the Crown Entities Act in 2013 to facilitate the involvement of Crown entities in State sector reform. However, consideration should be given to further ways in which Crown entities can move to a stronger focus on collective impact just as the core Public Service is now doing.
Improving Board performance is the major way that Ministers have of driving for results in the wider State sector. Board performance has a range of determinants, a major one being the quality of Board appointees.
Across the broader State sector, Ministers are responsible for appointing between 2,000 and 3,000 members to more than 520 boards at a cost in excess of $43 million in annual board fees. In 2014 alone, Ministers have some 850 board appointments to make, supported by departments and Crown entities.
The current system for appointments to Boards (outside the schools sector) depends on departments and entities supporting Ministers, and in that respect performance is mixed. There is no overall system to manage the candidate pipeline for the Crown and no standard appointment process. Some agencies interview potential candidates and some donâ€Ÿt; some advertise, some do background checks, but there is no consistent approach. Though we have a number of talented Directors and strong Boards this is the product of the efforts of individual Ministers and Board members rather than an outcome guaranteed by a robust system.
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