THE HAPS
Wow. Real Change Now was a success beyond all expectations. 670 people packed out Auckland’s Sky City Theatre for a rally heaving with energy. Even the media coverage by TVNZ, Newshub, The Herald, Stuff, Newsroom and RNZ was resoundingly positive. Thank you if you came, and if you missed David Seymour’s widely praised speech it is here.
FREEING THE KIWI DNA
At the Rally, ACT launched a stronger policy to cut back red tape where so many have failed. This week, Free Press runs through this policy, which is also set out here.
We’re a nation of pioneers. It must be true because each of us, or our ancestors, travelled farther to give our kids a better tomorrow than anyone else on earth. You can see this basic fact on a map of the world.
The folklore is awesome. No. 8 wire, the Kiwi can-do attitude, Everest and the America’s Cup, we love it. The truth is today New Zealand is a country that says no. Drowning in red tape, orange cones, and poorly thought out regulation.
The problem is not just the extra costs added to things that do happen, like utilities paying more for traffic management plans every time they fix a drain or a wire. The problem isn’t just the projects that don’t happen because of regulatory delays and uncertainty, like the non-existent subdivision where the would-be developer gave up in despair.
Those are real problems, but they pale in comparison to the effect that regulatory overkill has on culture. Over time there is less success around to admire, and giving up becomes a better strategy. What kids see growing up becomes the country’s culture, and red tape is deadening ours. The Polynesian explorers would never have made it out of Hawaiki if they’d had red tape like ours.
Overregulation affects every sector. Farming is an obvious one. Andrew Hoggard’s excellent speech to Real Change Now explained how regulatory uncertainty saps confidence and investment on farm.
Construction is also obvious, building consents are a nightmare to get, and restrict innovation in building, so everything costs a fortune. Anything to do with resource use has been well covered, the RMA is a disaster for productivity and affordability.
But, there are less obvious examples. An Early Childhood Education Centre once told us they have to comply with 303 regulations before they open their door. They get weekly updates from the Ministry of Education, describing new regulations.
The CCCFA law that recently put every borrower on a par with an indebted beneficiary, and every bank on a par with a loan shark was only the latest crazy regulation to face the financial sector. Organising something as innocuous as a Santa Parade with your local council can be like an episode of Yes, Minister.
Many have tried and failed to solve this problem. Nearly every new law is accompanied by a Regulatory Impact Statement. They are often 30 pages thick, but they are hopeless. They are written by the department that proposed the law. They rarely explain what problem is being solved, what the costs and benefits of the law are, or who pays the costs and gets the benefits.
As a result, Regulatory Impact Statements are ignored by everyone. MPs get little value from them. Media probably don’t have time to read them. Every Minister and Department will tell you regulatory responsibility is very, very important, but also their ideas need to be advanced without delay.
If these questions were taken seriously, most of what the current Government has done wouldn’t have got through. Most of their ideas don’t solve a clearly defined problem, have more costs than benefits, and benefit some at the unfair cost of others.
On the weekend ACT made three proposals to change all that. The first is to pass the Regulatory Standards Bill. Making good lawmaking a law in itself means the victims of red tape can challenge bad lawmaking in court. For example the Property Investors Federation might take a case against the latest lunacy forced on landlords.
The second is to take the people who are currently (and badly) doing Regulatory Impact Analysis, and put them under one roof with their own Minister holding them accountable for doing the job properly. If Regulatory Impact Statement are worth doing, they are worth doing right.
They would also go on regular red tape cutting missions to find bad and pointless laws in, say, Early Childhood Education, then present a bill to Parliament that would eradicate them. The onus goes on the Minister to justify keeping the laws on the chopping block, a total reversal of how things work now.
The third is to put some political capital behind doing Regulatory Impact Analysis right. One reason bad laws get passed is that every politician opposes bad law making until they reach the top of the greasy poll and get to make their own.
ACT has form for swimming against the tide, turning down baubles, and taking unpopular positions that prove to be right. The party says it would not vote for laws that haven’t passed the basic tests of problem definition, cost benefit analysis, and other basic tests of a new law or regulation.
This idea shows how ACT could play a positive role in Government. It’s a principled line in the sand. The standard of law making must improve, and this is an innovative policy and political strategy. It will make New Zealand a better place for all those beaten down by bad laws and regulations, including the essence of Kiwi culture itself.