March 5, 2025 3:20pm by David Farrar

Adrian Orr resigns

Adrian Orr has resigned as Reserve Bank Governor. I normally try to highlight the good as well as the bad when someone resigns, but I have to admit in this case I struggle.

I welcomed his appointment in 2017. I noted the currency rose on his appointment and that he had a very good legacy at the NZ Super Fund. And this is true – I thought he did an exceptional job at NZSF, and thought he would do the same at the Reserve Bank.

I think he had a number of failings in his role as Governor. These were:

Bullying. I’ve lost count of how many stories I have heard about Orr acting in a threatening way to either RBNZ critics or senior bank executives. His behaviour would be unsuitable for any senior regulatory role – but especially one so powerful as Reserve Bank Governor. The more powerful the role, the more restrained you should be (unless you are Donald Trump it seems).
A refusal to admit errors. When an analyst points out the Reserve Bank predictions have changed dramatically in a few months, the Governor lashed out at them. There was never any concession about errors made in the Covid-19 response. Admitting that you made mistakes is a strength, not a weakness.
A near tripling of staff numbers at the Reserve Bank. Incredibly even after the change of Government when all other public agencies were reducing staff numbers, the Reserve Bank continued to expand massively. The number of staff earning over $100,000 has gone from 140 to 436.
Operating expenditure has gone from $69m to $186m since 2016
Inflation exceeded the 3% agreed limit for 13 consecutive quarters, or over three years – peaking at 7.3%
Around $11 billion of losses in Covid-19 interventions
A focus on policy areas that are at best tertiary concerns to the Reserve Bak such as Te Ao Maori and climate change, rather than the core focus of inflation
Excessive regulation of banks, increasing costs to consumers