A survey of 24 New Zealand regulatory agencies has placed the Takeovers Panel as most respected, with Heritage New Zealand Pouhere Taonga coming out as least-respected.
The results are contained in a report Who Guards the Guards? Regulatory Governance in New Zealand, authored by Roger Partridge and Amy Thomasson for The New Zealand Initiative.
The New Zealand Initiative describes itself as an independent public policy think tank supported by chief executives of major New Zealand businesses.
The report aims to follow the 2014 Productivity Commission report, Regulatory Institutions and Practices, which found a range of shortcomings with regulatory agencies.
The authors say they met major consumer groups to gain their views on leading commercial regulators and surveyed just over New Zealand businesses and professional services providers and asked them to rate and rank the commercial regulators they deal with across 23 performance metrics. Information was also gathered by interviews with leaders of several regulators and government department officials.
The survey result includes ratings for three parts of the Commerce Commission.
Table of rankings of regulators
|2||External Reporting Board||4||0||2||1.6|
|3||Inland Revenue Department||30||3||5||1.1|
|4||Financial Markets Authority||29||1||9||1|
|5||Accident Compensation Corporation||30||3||5||0.6|
|6||Ministry for Primary Industries||15||0||2||0.6|
|8||Energy Efficiency & Conservation Athty||11||1||1||0.5|
|9||Commerce Commission - Price Regulation||23||4||4||0.3|
|10||Commerce Commission - Telecoms||9||1||2||0.3|
|11||Department of Conservation||8||0||1||0.3|
|12||Civil Aviation Authority||7||1||3||0.1|
|13||Health & Disability Commissioner||1||0||0||0|
|15||WorkSafe New Zealand||30||6||3||-0.1|
|16||Ministry of Transport||12||1||1||-0.2|
|17||Commerce Commission - Competition & Consumer||33||10||2||-0.6|
|19||Environmental Protection Agency||6||2||1||-1|
|21||Land Information New Zealand||9||3||0||-1.1|
|22||Transport Accident Investigation||4||0||0||-1.1|
|24||Office of Film & Literature Classification||3||0||0||-1.5|
|25||Fire and Emergency NZ||8||0||0||-1.6|
|26||NZ Transport Agency||16||3||1||-1.7|
|27||Broadcasting Standards Authority||5||3||0||-1.9|
|28||Human Rights Commission||7||3||0||-2.2|
|29||Heritage NZ Pouhere Taonga||2||2||0||-5.5|
Focus on three regulators
The authors say they focused in detail on three regulatory agencies whose influence is felt across the entire economy - the Financial Markets Authority (FMA), the Reserve Bank of New Zealand, and the Commerce Commission: "If any regulators are to be respected, it is most important that these three are".
They say their research found comparatively poor levels of respect for both the Commerce Commission and Reserve Bank. On average only 39.9% of survey respondents either agreed or strongly agreed that the Commerce Commission met the 23 KPIs, and 25.8% disagreed or strongly disagreed. The results were worse for the Reserve Bank, with 28.6% of respondents agreeing or strongly agreeing and 36% disagreeing or strong disagreeing.
The FMA scored comparatively well, with 60.8% of respondents agreeing or strongly agreeing that it met KPIs and just 10.3% disagreeing.
The authors say two aspects in particular of the FMA’s institutional framework, both of which are copied from the private sector, appear to contribute to the FMA’s higher ratings.
"First, the separation of governance and management functions of the FMA’s chair by the appointment of a highly skilled CEO. Second, the transformation of executive ‘commissioner’ positions into non-executive board roles. In tandem, these two factors appear to contribute both to greater levels of accountability by the executive decision-making organ of the FMA and to more widely acknowledged expertise at the board level."
They say that as the board governance model is the most common governance structure among New Zealand’s statuory Crown entities, it is anomalous that the same model is not adopted for the Commerce Commission and the RBNZ.
"The lessons from the FMA are that the model creates better internal checks and balances on regulatory decision-making than the alternative ‘commission model’ of the Commerce Commission or the ‘single member decision-maker model’ of the Reserve Bank."