State Services Inquiry Constitutional Society’s Submissions Questioned

Press, Volume CI, Issue 29728, 23 January 1962, Page 14

State Services Inquiry Constitutional Society’s Submissions Questioned

(N.Z. Press Association) AUCKLAND, January 22. The political issues raised cast “grave doubts” on a substantial proportion of the evidence given by the Constitutional Society to the Royal Commission on State Services, the chairman of the commission, Mr Justice McCarthy, said in Auckland today.

His Honour asked the society’s executive officer, Mr A. F. Manning, who had just completed his evidence before the commission, if he had read the commission’s order of reference. A “very substantial proportion” of matters raised by the society were really political matters outside the order of reference. Mr Manning replied that all the society’s evidence concerned changes in the structure of State departments.

The commission began its Auckland sitting this morning and is expected to spend three days hearing evidence from seven witnesses.

In his submissions, Mr Manning said that the defects of the Nelson cotton mill agreement gave little grounds for confidence in the “vast and dictatorial planning department” which the Department of Industries and Commerce had recommended to the commission.

Creation of the proposed department would be an extremely dangerous development which could lead only - to establishment of a powerful State dictatorship, he said.

Under the proposal, the present Department of Industries and Commerce would absorb the Customs Department and take over town and country planning, tourism and fisheries It would have responsibility in a further vast field of State activity and would have a say in the formulation of policy in many other fields It was intended to recruit to the proposed department the cream of the intellectual output of the universities, he said. “Apathy And Cynicism” This would mean a great extension of the situation, already too prevalent in New Zealand, of national policy being determined by the employees of the State and not by the elected representatives of the people, Mr Manning said. "We assert that in recent years the verdict of the electors in general elections has had little effect on administrative procedures or departmental policies and the failure of Governments

to implement clearly enunciated policies and philosophies on which the electors had passed judgment has created a public apathy and cynicism which are a negation of the long-established principle that the sovereign power rests with the people. This experience, we submit, suggests that real power now rests primarily with the bureaucracy.” he said. There was no call for the State to intervene in industry in normal times except to ensure safety and proper working conditions for those engaged in it. It should not be necessary for the proprietors of industry, or those wishing to engage in industry, to have to consult Government officials before they could make any move. State Planning Opposed “The society believes that the elasticity and resilience of the private enterprise system can make a far greater contribution to the welfare of the community generally if unhampered by State restrictions than any amount of elaborate State planning,” Mr Manning continued. “The weakness of State planning in establishing new industries is that the cost to the consumer is seldom considered to be of any importance, and in return for a limited amount of extra employment, sometimes largely of workers who have to be brought from overseas, consumers have to pay prices far higher than for similar imported goods, with detrimental effects on the cost of production of export goods.” Although it might not be the function of the commission to consider the actions of the Government in maintaining secrecy about the

terms of the cotton mill agreement for so long, the society submitted that it was relevant to point out the weaknesses of the agreement, in view of the desire of departmental planners to set up a great department to do much more of that sort of planning. Eminent counsel consulted by the society had commented that the words in the agreement "are so lacking in clarity on a number of points that no-one can say, with confidence, precisely what has been agreed.” It must be incomprehensible to any businessman (it certainly is to a lawyer) that an agreement on which millions of pounds of money and the future of an essential industry depend was not reduced to concise and unambiguous form by a competent legal draftsman.

Incompetence “Proved” The society claimed that incompetence in the negotiation of the agreement was proved by the fact that directors of the company. Ministers and senior departmental officials had to spend many weeks in trying to resolve difficulties arising from the agreement. Furthermore, there was some legal opinion that the agreement was a breach of the Trade Practices Act. which was administered by the Department of Industries and Commerce itself, and that it was a breach of New Zealand's international obligations under the General Agreement on Tariffs and Trade.