[Sitting date: 21 March 2012. Volume:678;Page:1146. Text is incorporated into the Bound Volume.]
Hon DAVID CUNLIFFE (Labour—New Lynn) to the
Minister for Economic Development: What, if any, are the capital costs, write-downs and redundancy costs expected from the merger of the Ministry of Economic Development with the Ministry of Science and Innovation, Department of Labour and Department of Building and Housing?
Hon STEVEN JOYCE (Minister for Economic Development)
: The specific costings for the items sought by the member are not available at this time. As stated last week when the planned merger was first announced, a due diligence process is now under way, and Cabinet will receive a report next month that will provide further information. We are confident, given our recent experience with other public sector structural change, that the costs will be able to be met within baselines. We also expect savings through better coordination, better-quality advice, and giving businesses one agency to talk to, and that these will outweigh the costs.
Hon David Cunliffe: I seek leave to table a document created by the Parliamentary Library, depicting the Ministry of Science and Innovation’s shiny new logo, which so far has been relevant for only 404 days. [Interruption]
Mr SPEAKER: Order! The member has—[Interruption] Order! This is a point of order. Members have the right to refuse the tabling of a document. [Interruption] Order! Now, look, we will cut out this chipping across the House while a point of order is being considered. Let me check with the honourable member. That is a document created—
Hon David Cunliffe: From the Parliamentary Library.
Mr SPEAKER: —by the Parliamentary Library. Leave is sought to table that document. Is there any objection? There is no objection.
Document, by leave, laid on the Table of the House.
Hon David Cunliffe: I seek leave to table this document created by the Parliamentary Library, depicting the Ministry of Economic Development’s new website branding, which was relevant for no more than 235 days.
Mr SPEAKER: Leave is sought to table that document. Is there any objection? There is objection.
Hon David Cunliffe: Why was a full due diligence not completed on the full costs of the merger prior to its announcement? If one was completed, who conducted the due diligence and what was the result, and if one was not completed prior, why not?
Hon STEVEN JOYCE: Because the Government took a strategic decision—
Hon Member: Oh!
Hon STEVEN JOYCE: It did. It took a strategic decision to, in principle, merge those ministries, and then a full public due diligence process. The reality, as the member knows, is that you have to go through a process and that involves a significant number of officials and people and a significant amount of time. It is appropriate that Cabinet make a strategic decision first, and then that work is done once Cabinet is keen to move forward.
Hon David Cunliffe: Why did the Government merge or propose to merge the Ministry of Economic Development with other entities, when it has yet to receive any advice from any of the six ministerial committees it has announced it will set up to discover an economic development strategy from amongst its laundry lists of action plans?
Hon STEVEN JOYCE: The member is just simply incorrect. The reality of the situation is that the Government has been working, as he knows, across a huge range of areas in the wider economic development space. The Government’s view, though, is that there is a real opportunity to get some real strategic go-forward in the areas of innovation, for example; in the areas of skills, which the previous Government going back many years grappled with and failed; and also in the areas of productivity and competitiveness. Actually, I note that the member himself said that there could be value in the new joined-up entity and that he did not want to take an ideological stand against it.
Hon David Cunliffe: Does he agree with commentator Colin James that the proposed restructuring is “1980s MBA-think.”, which reverses the correct order of form following function and function following strategy, and, instead, puts the organisational cart ahead of the strategic horse?
Hon STEVEN JOYCE: I think the member would be more familiar with 1980s MBA-speak and MBA-think than me. I do not agree with Mr James on that. What I do agree with is a number of stakeholders who have responded to the Government’s announcement very positively. For example, the chief executive of Business New Zealand said it will reduce levels of duplication, and that will be appreciated by many enterprises. Science New Zealand said that Crown research institutes and Science New Zealand welcome this integration: “The new Ministry will integrate and strengthen the government’s policy capability around innovation,”. The New Zealand Manufacturers and Exporters Association, which is not one that I regularly quote, said “There is no doubt that the number of ministries can be reduced and this should improve operational efficiency and help cut operating costs.”