March 23, 2010 1:19pm by David Farrar

Labour on Productivity Commission

Its nice to be able to say that I support a government policy, albeit with some caveats. I think there is considerable value in a Productivity Commission. One of the main reasons is that it will ensure there is some critical long-term thinking about government policy.

Lianne Dalziel has also said supportive things. I’m pleased to see Labour supportive of this initiative, for two reasons.

The first is simply because it is a good idea.

The second is because the sucess of the Australian Productivity Commission is partly because it does have bipartisan support. and I have long stressed that any NZ counterpart needs to also have such support, to be truly effective.

As David Cunliffe has noted the principal concern about the commission announced here is the breadth of their mandate. From the early indications it looks as though the mandate will be somewhat narrower than the Australian one. I think that is a mistake. Using a broader measure of productivity is essential for the commission to have a positive influence. For example, the Australian commission has recently done a report on the role of the not for profit sector in terms of productivity. I am not sure that would fit in the terms of reference for NZ. It should, if it is to give us some clear long term benefits to our wealth and well-being.

The terms of reference may change over time. I’m not sure it is a bad thing to start more focused, and then maybe expand the brief once it has some solid work done.

We need a commission with an independent and broad focus. This can not be just about regulation and short term issues. I believe if we get the mandate right (and it has support across the political spectrum) it could play a vial role in our development as a country.

Independence is key. While it is not a constitutionally important role that needs the formal agreement of Parliament, I hope both National and Labour would agree on serious consultation with each other (depending on who is in Government) on appointments to the Commission.

Again, it is good to see support from Labour for a NZ Productivity Commission.