Finance Minister Nicola Willis took a proposal to the Cabinet this week to change the Public Service Act to allow public servants to calculate the cost of political party promises.
It was the latest iteration in a nine-year battle to establish some form of public body to calculate the cost of parties’ promises. Each time the proposal comes close to being enacted, however, events conspire to block it.
In the most recent case, Act and NZ First stymied Willis’ plan after her counterparts in Labour and the Greens agreed that they supported some form of a non-partisan costings unit.
Hipkins’ letter to Luxon offered Labour’s support to negotiate and pass some kind of legislation to create a costings unit if it came to the House. That would give any legislation 83 votes, more than enough to pass.
The letter said: “While we may disagree on many areas of policy, we share a belief in the importance of transparency, accountability, and evidence-based decision-making.
“As has long been proposed, an independent costing unit would provide the public with greater confidence in the fiscal impact of political promises, particularly during election periods.
“The Labour Party has consistently supported initiatives that improve fiscal transparency. In that spirit, I am formally indicating our willingness to work constructively with you, the Minister of Finance and officials to advance the proposal for an independent policy costing unit.”
The letter did not explicitly support the exact model that Willis proposed, which was quite different from the idea of a Parliamentary Budget Office (PBO) that Labour and the Greens supported when they were in government and which they still support. Labour’s finance spokeswoman, Barbara Edmonds, currently has a Member’s Bill that would create a PBO.
However, Hipkins offered to “support legislation, if required” to create an institution that had independence and was supported across the political spectrum.
Co-operation between the two major parties is rare, but not unprecedented. In the last Labour Government’s first term, Labour looked to lean on National to pass terrorism legislation after demands from the Greens became too much. National’s demands then grew so great that Labour went back to the Greens anyway.
Willis’ proposal had several risks, outlined in a Cabinet paper, regarding leaks and pressures on public servants’ time and resources, but it would have been far easier to establish.
National’s idea was to amend the Public Service Act to allow political parties represented in Parliament to call on the resources of public servants to cost their policies. It would establish a unit within the Public Service Commission to co-ordinate these requests.
