Fran O'Sullivan: Brains trusts to put heads together

Finance Minister Bill English is hatching a series of in-house economic brains trusts to indulge in some blue-sky thinking about issues that matter for New Zealand's future.

It is too soon to say whether English's stratagem will result in a rival court to the commercially-minded young thrusters who are part of Prime Minister John Key's own kitchen Cabinet. Businessmen like the peripatetic NZX boss Mark Weldon who chaired the Prime Minister's Job Summit.

Documents posted on the Beehive's website indicate that many of the 21 key ideas that sprung out of the late February summit still seem bogged-down in Cabinet ministers' in-trays. The programme of work, as reported in Cabinet papers, is woefully under-resourced.

The one-day "do fest" will quickly fade into the background.

Already, Air New Zealand chief executive Rob Fyfe, who was one of the summit leaders, is miffed that English did not announce a big fillip for the tourism industry in the Budget.

Fyfe has put a lot of time in brain-storming ideas directly with Key, who also happens to be Tourism Minister.

But while there is increased funding for tourism promotion in Australia, the crunchy marketing ideas have yet to get over the line.

Council of Trade Unions boss Helen Kelly was also disappointed with the Budget.

Kelly and Fyfe co-chaired the summit work session on core workplace and employment issues that developed the nine-day fortnight.

The CTU boss has extended considerable goodwill to the Key Government which could be jeopardised if she comes to believe that she was invited simply as window-dressing.

Top business people also have only so much time to devote to big Government-sponsored showcase events like the Clark regime's Catching the Knowledge Wave and the Job Summit.

Unless business people who have put up their hands to do some ongoing work are properly enlisted, the event will soon be stigmatized as subject to Weldon-capture.

There is, for instance, no sign that Key intends to appoint someone to his private office to drive progress - which was the expectation of some well-connected business people who attended the summit.

English's soirees will not be in public - more likely sandwiches and coffee in his Beehive office.

He still appears to be at the "no names, no pack drill" stage.

No economists have been publicly shoulder-tapped. But they will come from the independent or academic sphere.

The field is not huge. Academic economists like Brian Easton (Wellington) and Tim Hazeldine (Auckland) have at times been on the outer with the Treasury department. Probably because they are not shy to fearlessly challenge the accepted wisdom.

But English intends to mix the academics up with his Treasury boffins.

Lewis Evans and Brent Layton - both from Wellington - are already on the team that is reviewing the electricity sector.

Top banking economists like Westpac's Brendan O'Donovan or ANZ National's Cameron Bagrie are not intended to be part of the mix as they are "commercial".

Some - like Bagrie - are on Key's own Rolodex and the PM pays them assiduous attention.

From what the Finance Minister's advisers are saying it sounds as if their boss wants to get some perspective on big issues such as how the overseas financial banking crunch may play out in this part of the world - and what to look out for next.

There will be different players involved depending on the issue. But the key point is they are being shoulder-tapped because they are "independent".

Not stated is the obvious, that English's brains trusts will provide a counter-point to the intuitive approach that Key and his financial markets colleagues have on such issues.

This is not the full-blown economic strategy that English hinted the panel might be involved with during question time at Budget lock-up.

But it could well play into the work that English asks the Treasury to put together as he works towards next year's Budget.

This more free-wheeling style is different to his predecessor's mode.

Michael Cullen directly employed advisers like economist Peter Harris within his own office as a counter-point to Treasury.

He also directed another adviser, Chris McKenzie, to work on major transport and rail policy issues rather than go through a Treasury bottleneck.

But Cullen also cut corners by opting not to seek full Treasury advice before committing the Crown to buy back NZ Rail.

English is a former Treasury official and is concerned that the department has been run down by the Clark Government which feared its power.

This is not a return to Treasury's "glory days" but a step in the right direction of getting more contestable ideas into the system.