State Sector and Public Finance Reform Bill. Andrew Royle, Frank Peek & Warwick White

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1 State Sector and Public Finance Reform Bill Andrew Royle, Frank Peek & Warwick White

2 Overview Key themes raised during select committee: 1. Government Workforce Policy 2. Chief executive powers to delegate 3. Redundancy provisions 4. Immunity for Public Servants 5. Ministers engaging with departmental chief executives and boards once there are 3 year SOIs Other issues

3 Objectives of the Bill Collaboration and organising around a results approach Sharing functions and services, leveraging the scale and expertise of the State services Financial and reporting flexibility Strengthened leadership at the system, sector and departmental level The Bill is one element of an ongoing broader programme of work to support Better Public Services

4 1. Government workforce policy Submitters concerns Order in Council mechanism unnecessary May override existing obligations and rights relating to bargaining (e.g a wage freeze) Aims Provide for transparent development & application of overarching workforce policy, relating to employment relations and workforce capability What the Bill provides for Process to develop workforce policy including principles relating to pay or conditions and development of workforce strategy Promulgation by OIC: Depts & Crown agents to give effect; ACEs to have regard What the Bill does not change Government may establish policy and set expectations about collective bargaining What advisors propose Replace Workforce Orders issued by OIC with Policy Statements issued by Minister Changes to clarify purpose and content More specific avoidance of doubt clause about impact on rights and obligations

5 2. Chief executive powers to delegate Submitters concerns Lack of general obligations and standards outside Public Service Third parties should know if decision made by non Public Service delegate Chief executive duties should not be delegated, only functions and powers Delegates could be provided with greater protection from liability than the department Aims Outside departments: use best placed decision maker; better partnering What the Bill provides for Safeguards: approval by Minister; no subdelegations; OIA; annual report What the Bill does not change Chief executive responsibility; may revoke at any time; maintains statutory restrictions No impact on contracting out What advisors propose Require prior written approval Apply code of conduct and same restrictions as on chief executive Delegate to provide information for 3 rd parties No delegation of chief executive duties

6 3. Redundancy provisions Submitters concerns Retrospective intrusion into agreements, undermines negotiated redundancy entitlements People will be forced into jobs they don t want; lower skilled/paid; will be forced to move Not restricted to public servants big expansion; will lead to flight from public service Aims Avoid taxpayers compensating government employees if no loss of entitlement suffered What the Bill provides for No payment if, before job ends: offer of an alternative role (comparable and same general location) in State Services; offer & acceptance of another position in State Services Expanded grounds of redundancy: for any reason (Crown entities: still if functions transfer) Expanded scope of offers: positions anywhere in State Services

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11 Redundancy cont. What the Bill does not change Offer of alternative position is exempt from notification, merit requirement, review What advisors propose Clarify application: only public servants (& Crown entity employees if functions transfer to depts) Insert: no payment only if other position starts straight after current job ends Clarify: offer & acceptance of another position must be on terms & conditions no less favourable overall and must treat service as continuous service

12 Redundancy: staged implementation Not recommended Inequitable treatment of employees in the same restructure Need for it to be limited in time (e.g. in the example below, limited to 4 years by collective agreement negotiation cycle) Still creates practical difficulties in change processes e.g. Orders in Council still required for some employees Drafting as requested: (4) In relation to the redundancy of an employee who is bound by a collective agreement that came into force before the commencement of this section, (a) this section does not apply; and (b) this Act as it was in force immediately before the commencement of this section applies.

13 4. Immunity for Public Servants Submitters concerns Change law from previous situation Might inadvertently prevent people suing the Crown Aims Re establish protection from personal liability Ensuring Crown remains liable What the Bill provides for Limits situations where public servants can be sued (SSA) Enables the public to sue the Crown (Crown Proceedings Act) What the Bill does not change Enables the public to sue public servants for acts/omissions: (1) bad faith; (2) outside duties What advisors propose Provide similar protection for the Education Service Note broader Law Commission s review: option to reconsider

14 5. Ministers engagement with departmental chief executives once there are 3 year SOIs Opportunities for Ministers to engage with departmental chief executives for setting strategy and performance expectations: When Available levers Focus Legislative requirement Annual cycle before start of each financial year (e.g., as part of Budget planning) Ministers /government s expectations SSC s chief executive performance expectations Priorities and strategy Priorities 4 year plans Strategy, organisation, finance and workforce, and Votes administered by the department Performance expectations for Deliverables appropriations Output plans Deliverables X X X X Any time (e.g., change of Minister or Government) Strategic intentions (can last for 3 years, but can be reviewed and renewed more frequently) Strategy

15 Ministers engagement with Crown entity boards once there are 3 year SOIs Opportunities for Ministers to engage with Crown entity boards for setting strategy and performance expectations: When Available levers Focus Legislative requirement Annual cycle - before start of each financial year Ministers /government s expectations Statement of Performance Expectations Priorities and strategy Deliverables Output agreements Deliverables X X Any time (e.g., change of Minister or Government) Strategic intentions (can last for 3 years, but can be reviewed and renewed more frequently) Strategy Intending that a Minister can require a new SOI to be prepared at any time for Crown entities [cl179,s139(5)] and departments [see Issue 2.7 in Departmental Report]

16 Other issues / questions