34 Part 1 of the SSA deals with the duties, functions and powers of the Commissioner and includes provisions for the Deputy State Services Commissioner. Issues for review included:
- the desirability of inserting a section that sets out the role of the Commissioner
- the need to ensure an accurate and up to date description of the Commissioner's principal functions
- the desirability of expanding the application of the existing power to require agencies to supply certain information
- the desirability of broadening the grounds on which the Governor-General may appoint an acting Commissioner or acting Deputy Commissioner.
Role of State Services Commissioner
35 The SSA is constructed around the statutory officer position i.e. the duties, functions and powers of the Commissioner, rather than the agency i.e. the SSC as a department of State. This construct is appropriate generally for accountability purposes, in so far as people/officers are better able than agencies to be held accountable for functions and powers conferred on them.
36 The SSA was silent about the overall role of the Commissioner. This is a separate issue to the purpose of the Act itself, which is discussed at the start of this paper.
37 Common feedback from stakeholders including public servants in other departments indicated there was a general lack of understanding of the role of the Commissioner (and hence of the SSC, whose employees act as the Commissioner's agents). "What does SSC do?" was a relatively common question. In addition to the range of statutory functions included in the SSA, the Commissioner is regularly asked by Ministers or Cabinet to perform other functions that are not in the Act. Historic examples include administering the Mainstream Supported Employment Programme (transferred to MSD) and hosting the Learning State Industry Training Organisation (transferred to a stand-alone company). Current examples include administering the Fees Framework for members appointed to Crown bodies as well as administering the State Sector Retirement Savings Scheme and Kiwi Saver in the State sector. The variety of the Commissioner's functions and underlying mandates contributes to a lack of clarity about the role of the Commissioner.
38 To ensure the SSA is fit for purpose and meets the current and ongoing needs of the State services, it was desirable to include a provision setting out the role of the Commissioner. Articulating the Commissioner's role would provide clarity about the purpose of the Commissioner, and therefore the SSC.
39 To arrive at an accurate statutory expression of the role of the Commissioner now and for the future, it is useful briefly to review the past. Going back to the origins in 1912, the Public Service Commissioner (and two assistants) were appointed with the two objectives of building a unified career service and of promoting efficiency and economy in the Public Service. The particular concern was to combat the abuses of political patronage; it was assumed efficiency and economy would follow 13.
40 In 1946 the form of control changed to a Public Service Commission (PSC) of three members. In 1962, the McCarthy Commission commented on the range of factors why the PSC "has been unable to deal adequately with the wider aspects of efficiency and economy. It has not been able to give the imaginative and forceful leadership which the Public Service requires" (ch 3.40). The McCarthy Commission wanted to "dispose of the erroneous but common view that the [PSC's] chief function is to act as a personnel authority independent from political control". It wanted the PSC's role "to be changed and strengthened so that it can, and will, become the chief adviser to the Government on matters of Government administration" and that the PSC be "charged with, and indeed exercising, the wider responsibilities needed if it is to provide dynamic and imaginative leadership in a changing world" (ch. 43-44).
41 When Hon Stan Rodger introduced the State Sector Bill to the House of Representatives in December 1987, his emphasis was not about the role of the Commissioner and SSC but about the personnel and industrial relations regime in which people charged with the management of public sector organisations could be held to account for their stewardship. The main feature was that heads of departments would be called chief executives appointed on individual contracts, and they would be the employer of their staff. Chief executives would be responsible to the Minister for the management and general conduct of their departments.
42 Despite the title of "State Sector Act", when promulgated in 1988 the SSC's 14 principal functions were limited to the Public Service (except that negotiating conditions of employment for employees extended to all of the Education service). Subsequently, two important functions were extended beyond the Public Service: the mandate to set standards of integrity and conduct now extends to most of the State services, and the mandate to review the machinery of government now extends across all areas of government. Also, upon request by the head of any part of the State services or of any State owned enterprise, the Commissioner may now provide assistance in respect of the conditions of employment of its employees. These extensions to the Commissioner's mandate were in response to the recommendation in the 2001 Review of the Centre to enhance the Commissioner's ability to provide leadership to State sector organisations beyond the Public Service.
Role to meet current and ongoing needs
43 The next section in this paper will discuss the Commissioner's principal functions, i.e what the Commissioner does. This part of the paper outlines proposals for a statutory expression of why, i.e. the overarching purpose of the Commissioner's office (as distinct from the purposes of the SSA) and hence of the SSC.
44 The Commissioner's purpose is more than a list of statutory and non-statutory functions. The Commissioner's position is a leadership role. In 1912, the Hunt Commission recommended that a Board of Management, subject to review by Cabinet, should be set up as the managing head of the whole Government Service. The Hunt Report stated: "it is to our mind essential that there should be one controlling head ... to hold the whole Service together, and make it work as one well-oiled and efficient machine" 15 . As mentioned above, a call for leadership was explicit in the McCarthy Report in 1962 and the Review of the Centre in 2001.
45 The theme of leadership is inherent in the role of the Commissioner. Arguably, it was part of the raison d'être for the existence of the role, although leadership was not mentioned explicitly in the Hunt Report in 1912. During the past half century, leadership has been called for explicitly.
46 Leadership is central in the BPSAG report, e.g. pages 8, 12:
- "[t]he single most critical driver of successful change is leadership".
- "Starting from the top, the Group considers that the State Services Commissioner needs to be unambiguously charged with leading the leaders: a clearly mandated Head of State Services"
- In this capacity, the Commissioner would be "accountable for overall performance of the state services and empowered to:
- appoint sector leads
- determine functional system-wide leadership roles and appoint chief executives into these roles
- deploy chief executives and second and third tier leaders to critical roles across the system".
47 A statement of the Commissioner's role should be pitched at a level that both cascades from the purposes of the SSA and provides the overarching and enduring framework for the Commissioner's functions discussed in the next section in this paper.
Recommendations to Cabinet
48 In order to reflect the substance of the leadership role described in the previous paragraphs, the Commissioner's role could have been proposed in a single statement along the lines of proving leadership and oversight of the State services. The alternative, preferred by officials, was to include the leadership dimension while also making the Commissioner's role cascade explicitly from the purpose of the SSA. Accordingly, BPS Cabinet paper six proposed that the Commissioner's role should include the following concepts (subject to drafting refinements): To provide leadership and oversight of the State services by –
- promoting a spirit of service to the community
- promoting a spirit of collaboration among agencies
- selecting and appointing high calibre leaders (changed in the Introduction Bill to "identifying and developing high calibre leaders")
- working with leaders across the State services to ensure they are well led and trusted (changed in the Introduction Bill to "working with State services leaders to ensure that the State services maintain high standards of integrity and conduct and are led well and are trusted")
- maintaining oversight of employment arrangements for the Public Service (changed in the Introduction Bill to "overseeing workforce and personnel matters in the State services")
- advising on the design and capability of the State services in the system of government (the Introduction Bill omitted the phrase "in the system of government")
- evaluating performance and promoting excellence and efficiency across the State services
- supporting the achievement of good results by the State services.
49 The concepts in the two bullet points immediately above were re-ordered and rationalised in the Introduction Bill to the following two concepts:
- evaluating the performance of Public Service leaders, including the extent to which they carry out the purpose of this Act
- supporting the efficient, effective, and economical achievement of good outcomes by the State services. A definition of "outcome" was inserted into the Bill, replicating the definition of the term in the PFA.
50 Of note, BPS Cabinet paper six did not single out the concept of stewardship for explicit mention as part of the Commissioner's role. At that stage, the dimensions of stewardship were considered to be included in the combined concepts of the design, capability and performance of the State services. However, during the process of legislative drafting (to insert a definition of "stewardship"; and to describe the stewardship responsibility of chief executives) it became very clear that stewardship constituted such a pivotal concept that it required explicit mention within the Commissioner's role. Accordingly, the Introduction Bill included as part of the Commissioner's leadership role "promoting a culture of stewardship in the State services".
51 The emphasis on collaboration and working with other leaders (not just as part of the Commissioner's role but also in other provisions in the SSA, eg in relation to senior leadership development) was intended to foster a cultural shift in preference to a more coercive role, which traditionally lacked effectiveness.
Select Committee process
52 No changes were made to the Bill during the Select Committee process in respect of the Commissioner's role. The Institute of Public Administration of New Zealand preferred a single statement of leadership and oversight, but departmental advisers preferred the transparent cascade from the list of purposes of the SSA to the various dimensions of the Commissioner's role.
Principal Functions of Commissioner
53 A clear and strong message from the workshops referred to in paragraph 19 was that the current list of principal functions of the Commissioner was pitched too lowly at a mechanical level. The functions should be reframed, lifted up, and cascade from the higher level purposes of the SSA and role of the Commissioner. This feedback reinforced the view already held in the SSC that the list needed to be revised in order to reflect contemporary practice and to better fit the medium and longer term needs of the State services.
54 Section 6 of the SSA provided as follows.
Functions of Commissioner
The principal functions of the Commissioner are-
(a) to review the machinery of government across all areas of government, including-
(i) the allocation of functions to and between Departments and other agencies; and
(ii) the desirability of, or need for, the creation of new Departments and other agencies and the amalgamation or abolition of existing Departments and other agencies; and
(iii) the co-ordination of the activities of Departments and other agencies:
(b) to review the performance of each Department, including the discharge by the chief executive of his or her functions:
(c) to appoint chief executives of Departments and to negotiate their conditions of employment:
(d) to promote and develop senior leadership and management capability for the Public Service:
(e) to negotiate conditions of employment of employees in the Public Service:
(f) to promote and develop personnel policies and standards of personnel administration for the Public Service:
(g) to promote, develop, and monitor equal employment opportunities policies and programmes for the Public Service:
(h) to provide advice on the training and career development of staff in the Public Service:
(ha) to provide advice and guidance to employees within the State services (except Crown Research Institutes) on matters, or at times, that affect the integrity and conduct of employees within the State services:
(i) to provide advice on management systems, structures, and organisations in the Public Service and Crown entities:
(j) to exercise such other functions with respect to the administration and management of the Public Service as the Prime Minister from time to time directs (not being functions conferred by this Act or any other Act on a chief executive other than the Commissioner).
55 The list of principal functions in s6 sets out the main responsibilities of the Commissioner at a 'headline' level. Broadly, they can be rationalised into functions that concern the system of government, and those that concern the people and culture in the system. It is particularly the functions concerning people and culture that are expanded upon through more detailed operational provisions in other parts of the SSA.
56 The Commissioner's principal functions should be expressed in a way that is enduring, and therefore should not contain operational or 'mechanical' detail that could be restrictive or subject to regular change. The SSC considered there should be a cascade from the principal functions in s6 to operational detail elsewhere in the SSA.
57 Accordingly, some of the current operational functions would be better transferred, in modified form if need be, to other parts of the SSA. With regard to the current list of functions in s6, the SSC considered that:
- there was a gap in so far as a new overarching function should be inserted giving effect to the Commissioner's leadership and oversight role, with up-front emphasis on the objective of performance improvement at agency, sector and system-wide level
- function 6(a), dealing with the machinery of government, should be rephrased by including explicit reference to the governance dimension and to inter-agency operations and performance as a system
- function 6(b) should be expanded in anticipation of future departmental agencies (as discussed among the proposals relating to Part 2 of the SSA); at the same time, other provisions suffice to cover reviewing performance by the chief executive of his or her functions
- function 6(c) should be expanded in anticipation of the future establishment of departmental agencies and clarify that, de facto, the Commissioner employs Public Service chief executives; the function includes reviewing their performance, without necessarily linking performance as a chief executive to performance of the department or departmental agency
- function 6(d) should be modified in a way that does not limit leadership development to senior leadership and management, nor focus solely on the Public Service
- function 6(e), dealing with negotiating conditions of employment, should be removed as a principal function of the Commissioner on the basis that operational level details are adequately covered elsewhere in the SSA
- function 6(f), concerning personnel policies and standards, should be elevated to cover workforce matters at a more strategic level, including a more overarching, proactive leadership role pertaining to people matters in the State services
- function 6(g) should be retained, but be transferred to part 5 covering personnel provisions
- function 6(h) should be deleted as a stand-alone principal function, with its substance incorporated in other provisions relating to capability development
- function 6(ha) should be transferred to the operational details in Part 5 relating to matters of integrity and conduct; instead the principal function in s6 should provide a more fundamental mandate expressed in terms of setting and reinforcing standards, and include specific focus on promoting transparent accountability
- function 6(i), dealing with advice on management systems and structures, should be deleted as a stand-alone principal function, with its substance incorporated in the amended function relating to machinery of government
- function 6(j) should be retained without modification.
Recommendations to Cabinet and legislation drafting processes
58 BPS Cabinet paper six reflected the thinking in the previous paragraph by recommending that the Commissioner's principal functions in s6 be replaced along the lines shown in the table in the next paragraph [CAB Min (12) 16/10, paragraph 82 refers].
59 Iterative refinements were made to the wording during the legislation drafting process, as anticipated, and as reflected in the Introduction Bill.
|CAB Min (12) 16/10, para 82||Introduction Bill|
|Cabinet agreed that s6 be replaced so that the principal functions of the Commissioner would be (subject to drafting refinements):||"For the purpose of carrying out the Commissioner's role, the principal functions of the Commissioner are to -|
|to review the system of government agencies and processes, with the objective of advising on ways to improve agency, sector and system-wide performance||(a) review the State sector system in order to advise on possible improvements to agency, sector, and system-wide performance; and|
to review agency and inter-agency governance, structures and systems across all areas of government, including advice on:
(b) review governance and structures across all areas of government, in order to advise on -
(i) the allocation and transfer of functions and powers; and
(ii) the cohesive delivery of services; and
(iii) the establishment, amalgamation, and disestablishment of agencies; and
|to review the performance of each department and each departmental agency||(c) review the performance of each department and each departmental agency; and|
to appoint leaders for the Public Service, including:
(d) appoint leaders of the Public Service, which includes -
(i) acting as the employer of chief executives of departments and chief executives of departmental agencies; and
(ii) reviewing the performance of chief executives of departments and chief executives of departmental agencies; and
|to further the development of leadership capability for Public Service departments and other agencies||(e) promote leadership capability in departments and other agencies; and|
|to promote excellence in workforce development, strategies and practices||(f) promote strategies and practices concerning government workforce capacity and capability|
|(g) promote good-employer obligations in the Public Service; and|
|to set and reinforce standards of integrity and conduct and promote transparent accountability||(h) promote and reinforce standards of integrity and conduct in the State services; and|
|(i) promote transparent accountability in the State services; and|
|to exercise such other functions with respect to the administration and management of the Public Service as the Prime Minister from time to time directs (not being functions conferred by this Act or any other Act on a person other than the Commissioner)||(j) exercise such other functions with respect to the administration and management of the Public Service as the Prime Minister from time to time directs (not being functions conferred by this Act or any other Act on a chief executive other than the Commissioner)"|
60 The function in s6(g) was inserted in the Introduction Bill to maintain the Commissioner's 'visibility' in the area of good-employer obligations, in the context of transferring the function relating to equal employment opportunities [previously in s6(g)] to Part 5 of the SSA. The insertion of s6(g) was consistent with the structure of the SSA whereby the Commissioner's functions cascade from, and contribute to, the purpose of the SSA and the Commissioner's role.
Select Committee process
61 No changes were made to the Bill during the Select Committee process in respect of the amendments to s6 of the SSA.
62 Consequential amendments were made to the Clerk of the House of Representatives Act 1988 and to the Parliamentary Service Act 2000. A clause was inserted to amend those Acts to the effect that, when exercising the s6 functions in relation to the Office of the Clerk and the Parliamentary Service, the Commissioner do so in a manner consistent with the independent functioning of the legislative and executive branches of government. The Office of the Clerk submitted that, because the functions in s6 are linked to the new purpose of the SSA, and because the purpose includes a system that operates in the collective interests of government, such provisions could undermine agencies in the legislative branch that operate independently from the executive. The Parliamentary Service made similar comments. The departmental advisers concurred that the proposed amendments would be appropriate, even if only for the avoidance of doubt rather than to prevent any realistic misunderstanding or mischief.
Powers of Commissioner
63 Sections 7-10 set out the powers of the Commissioner: all such reasonably necessary or expedient powers (s7); power to conduct inspections and investigations (s8); power to obtain information (s9); and power to enter premises and require the production of information and answering of questions (s10).
64 Prior to amendments to the SSA in 2005, the powers in ss7-9 applied to Public Service departments. As from January 2005, some of the Commissioner's functions extended beyond the Public Service to other parts of the State services and even beyond. In particular, the function of reviewing the machinery of government extended to all areas of government [existing s6(a)]; and functions relating to integrity and conduct extended to most of the State services [s6(ha) was inserted and s57 expanded].
65 To reinforce and support the exercise of these functions, there was an equivalent extension of some of the Commissioner's powers:
- the power in s8 extended to any part of the State services that comes under the scope of the function in s6(ha) relating to advice and guidance on integrity and conduct
- the power in s9 extended to: all areas of government for the purpose of reviewing the machinery of government under s6(a); the State services that come within scope of s6(ha); and to Crown entities for the purpose of advising on management systems and structures under s6(i).
66 Among the current amendments to the provisions concerning integrity and conduct (see the explanation in relation to part 5 of the SSA), the SSC proposed that s8(1)(b) be deleted on the basis that it is already included in s57C(1).
67 The SSC's primary proposal was that the power in s9 to require the supply of information in connection with the exercise of the Commissioner's functions should extend to any agency in the State services in respect of any of the Commissioner's functions (ie, not restricted to the limited range of functions and specified groups of agencies as summarised above).
Recommendations to Cabinet
68 In recommending the broadening of the application of the power in s9, BPS Cabinet paper 6 commented that, while agencies generally co-operate in supplying information, the existence of this power would overcome potential reluctance on the part of an agency to supply relevant information. The paper also noted that the power in s9 would not override provisions in other legislation that specifically permit the withholding of certain information.
Select Committee process
69 None of the submissions to FEC commented on the broadening of the application of the power in s9.
Grounds to Appoint Acting Commissioner or Acting Deputy Commissioner
70 Section 14 provides for the Governor-General to appoint an acting Commissioner or an acting Deputy Commissioner, as the case may be, "in the event of the incapacity of the [Commissioner/Deputy Commissioner] by reason of illness or absence or any other cause".
71 There may be occasions where it is appropriate to appoint an acting Commissioner or acting Deputy Commissioner because the incumbent must stand aside for reasons other than incapacity. Potentially, for example, conflict of interest situations could arise if the exercise of their functions or powers involves a close friend or relative. In this case the need to stand down does not arise, strictly speaking, from incapacity.
72 It was desirable that the SSA clarify the ability of the Governor-General in Council to appoint an acting Commissioner or acting Deputy Commissioner in circumstances that require the incumbent to stand down from performing a particular function. The Cabinet paper process that prepares advice for the Governor-General in each case would explain the circumstances and justification for making an acting appointment.
Recommendation to Cabinet
73 Cabinet agreed with the recommendation that the SSA provide for the appointment of an acting Commissioner or Deputy Commissioner in the event of incapacity or any other reasonable cause that requires the incumbent to stand down.
Select Committee process
74 None of the submissions to FEC commented on this amendment.
13 McCarthy Report, ch 3.32-33
14 The State Services Commission as a body of up to 4 persons was replaced in 1989 by the offices of State Services Commissioner and Deputy State Services Commissioner
15 Report of Commission Appointed to Inquire and Report Upon the Unclassified Departments of the Public Service of New Zealand – 1912 (Hunt Report), pgs 18-19