Quangos targets for Government’s cuts?

Press, 1 March 1982, Page 18

Quangos targets for Government’s cuts?

By

OLIVER RIDDELL

in Wellington

A chill of fear is sweeping through some Government agencies and their appointed membership. The fear is that the Government intends a drastic pruning of Quangos (quasiautonomous noh-Government organisations) as part- of its general plans to cut Government expenditure and its specific plans to cut departmental expenditure by three per cent. Faced with the increasing public pressure to reduce and/ or restructure taxation, the Government is . acutely conscious of the accompanying need to cut its own expenditure. This direction has become more apparent than ever since the Government’s re-election last November. Indeed, so widespread is- the impression now that this is a cost-cutting Government that some members of it are already starting to identify a backlash from middle-of-the-road voters who fear a major dismantling of the social welfare structure. Quangos would be a popular field for pruning; their roles are often not well understood. It would also be a fruitful one in terms of saving money,, although just how fruitful noone seems able to say exactly. Although efforts have been made to identify the costs of the functioning of the statutory corporations, companies, committees, tribunals, councils, and other Quangos, these have been unsuccessful. Although this information was contained in the Estimates of Expenditure for. the year ending March 31,1982, tabled in Parliament last year, it was not presented in such a way that it could be separated from other costs. In the middle of last year, the Labour Opposition spokesman on constitutional affairs (Mr G. W. R. Palmer,' Christchurh. Central) asked the Ministers of the Government how many appointments they

made to positions on Quangos arid other similar bodies while administering their 43 portfolios. He found there were 4185 such appointments. There are more than 600 Quangos set up in New Zealand whose membership (either all or in part) requires Ministerial approval. That list does not include the thousands of ad hoc bodies such as school committees which are not subject to Ministerial approval but which do, in fact, have responsibilities established by legislation. On the other hand, not all Quangos are set up by legislation. Quangos as a rule examine functions or perform duties not done by the public service, even though members of the public service' may provide their executive and clerical needs. Mr. Palmer has made a study of Quangos, and found that they come in a bewildering variety of shapes and sizes. There are:— * Statutory corporations established to carry out specific .' tasks — for example, the Accident Compensation Commission, the Tourist Hotel Corporation, and the Bank of New Zealand. * Commercial companies in which the Government owns . all the shares — for example, Air New Zealand, and the Petroleum Corporation. * Tribunals set up by statute and empowered to decide questions more pr less in the same fashion, as a Court — for example, the Accident Compensation Commission Appeal Authority, the Planning Tribunals and the Indecent Publications Tribunal. * Committees established to advise the Government — for example, the Torts and General Law Reform Committee, the Medical Services Advisory Committee and the Tobacco Research Advisory Committee. * Incorporated societies — for

example the Rehabilitation League New Zealand (Inc). Quangos include all sorts of bodies which the Government could not scrap without providing some other body to do the work instead. For example, the Meat, Wool. Dairy and Apple and Pear Boards are all Quangos which the Government might wish to influence, and can do so through its own nominees on them and through financial control, but which it would scarcely wish to abolish. However, there are plenty of opportunities for the Government to cut back on Quangos. For example, it could abolish the National Research Advisory Council if it felt research was costing too much to continue to have the importance it had had in the past. It might also suit the Government to still a Quango whose working parties and committees (notably over unemployment) have sometimes embarrassed the Government. Then there are Quangos which seem sometimes to duplicate each other's work, or the work of Government Departments, or to do work Government Departments are equipped to do. An example of this is the similarity between the work of the Environmental Council, Nature Conservation Council and Queen Elizabeth II National Trust. Combining and/or rationalising the work of these three bodies — the latter two of which have their own empowering legislation — has been in the air for several years. Quangos can be very convenient, not only to the Government they serve and to the Ministers who make appointments to them, but to everyone, in enabling specific tasks to be done by (hopefully) very competent people on a body specifically established to do them rather than a Govern-

ment Department wwith a host of other duties. The reasons why Quangos , are established vary even more than their form of legal organisation. They are set up to avoid political control and having a Minister responsible for the organisation (as with farming producer boards); to avoid departmental procedures and the controls exerted within the State Services (as with the Tourist Hotel Corporation); to relieve Ministers of responsibility for detailed or specialised tasks (as with the Overseas Investment Committee); to carry out fairly regulatory functions involving adjudication (as with the Planning Tribunals); to bring outside people into the management of the activity; to allow for representation of special interest in the administration of the activity (as with the National Parks and Reserves Authority). There are an astonishing 3500 Quangos in New Zealand. Even when the 2600 run by the Department of Education 1 (which incude school committees) are left out, there are still about 838. In reply to questions from Mr Palmer in Parliament in the middle of last year, the Minister of Social Welfare said he had 96 Quangos to administer, the Minister of Health 87, the Minister of Energy 62 and the Minister of Agriculture 57. So it is no wonder that those involved with Quangos see themselves as a prime target for Government cuts.

Any cuts in Quangos will need to be discriminating, but may be harsh. It would also be seen as a useful step towards more open government, at a time when a special Parliamentary Select Committee is hearing submissions on the Official Information Bill. Unless Quangos have a deliberate policy of openness, having a Quango can be a useful smok-

escreen to hide behind as most are not accountable to Parliament, and some are not even directly accountable to a Minister. Labour would love to see the Quangos cut. It sees the system as an iniquitous “jobs for boys” situation. Perhaps . because Labour has not held power very often in the last 30 years, it views many of the “boys” with some suspicion as proNational “boys” and the furore over the Marginal Lands Board loan to the Fitzgeralds was seen by Labour as justifying these suspicions.

It is being suggested around Wellington that one of the main reasons the Government is calling Parliament as early as April this year is so it can introduce the legislation needed to abolish a'number of Quangos which have empowering legislation. It is also being suggested that other non-legis-lative Quangos will also be abolished during the year. For a Government keen to cut its expenditure so it can reduce Us internal deficit before borrowing and also offer some tax cuts, the Quangos offer a juicy target.