Just when you think there are the occasional promising signs that the Reserve Bank might, perhaps, be becoming a little more open…….they come along and confirm that they are just as secretive as ever.
At the last Monetary Policy Statement, the Reserve Bank indicated that it had made allowance for four (and only four) specific pieces of the new government’s policy programme. They provided no details, beyond the barest descriptions, even though these assumptions fed directly into their projections and to the “acting Governor’s” OCR decision. In one specific example, they indicated that they had assumed that half the planned Kiwibuild houses would displace private sector housebuilding activity that would otherwise have taken place. That assumption directly feeds into their forecasts of resource pressures, but is also quite politically sensitive. You might suppose that in an open democracy, a public agency that came up with such estimates would publish their workings, at least when a formal request was made.
You’d be quite wrong. I lodged a request a few weeks ago, asking for “copies of any analysis or other background papers prepared by Bank staff that were used in the formulation of the assumptions”. I wasn’t asking for emails back and forth between staff, and I wasn’t even asking for the minutes of meetings where these papers were discussed. I certainly wasn’t asking for copies any other government department or minister might have supplied them. Just the analysis and related background papers the Bank’s own staff had done.
In response – having taken several weeks of delay – they didn’t redact particularly sensitive items, they simply withheld everything (down to an including the names of the papers concerned). This is, it is claimed, to “protect the substantial economic interests of New Zealand”, a claim which is simply laughable. Protecting senior officials of the Reserve Bank from scrutiny is not, even approximately, the same thing as protecting the “substantial economic interests of New Zealand”. It might even be less intolerable conduct if they had laid out the gist of their reasoning in the MPS itself. But they didn’t.
Of course, it is par for the course from the Reserve Bank. They consistently refuse to release any background papers related to the MPS, no matter how technical they might be, or how high the degree of legitimate public interest (I did once get them to release such papers from 10 years ago). They simply have no conception of the sort of open government the Official Information Act envisages.
Reform – including opening up the institution – is long overdue. I do hope that the Minister’s review of the Act is going to address these issues seriously.
And in the meantime you and I – citizens, taxpayers, who paid for this analysis – are left none the wiser as to why, say, the Bank thinks a 50 per cent offset is the right assumption for Kiwibuild. Perhaps it is, perhaps it isn’t, but the debate – including around monetary policy – would be better for having the workings in the public domain.
I was tempted to reuse my “shameless and shameful” description from yesterday, but that might a) overstate slightly the true importance of this particular issue, and (b) is a description better kept today for the Prime Minister and her willed blindness to the issues around China’s interference in the domestic affairs of New Zealand. Anything for an FTA extension, nothing for protecting the democratic institutions and values of New Zealanders.
Full letter from the Bank below.
Dear Mr Reddell
On 16 November you made an Official Information request seeking:
copies of any analysis or other background papers prepared by Bank staff that were used in the formulation of the assumptions about the impact of four specific policies of the new government (minimum wages, fiscal policy, immigration, and Kiwibuild), as published in last week’s Monetary Policy Statement.
The Reserve Bank is withholding the information for the following reasons, and under the following provisions, of the Official Information Act (the OIA):
- section 9(2)(d) – to avoid prejudice to the substantial economic interests of New Zealand;
- section 9(2)(g)(i) – to maintain the effective conduct of public affairs through the free and frank expression of opinions by or between officers and employees of the Reserve Bank in the course of their duty; and
- section 9(2)(f)(iv) – to maintain the constitutional convention for the time being which protects the confidentiality of advice provided by officials.
You have the right to seek a review of the Bank’s decision under section 28 of the OIA.
External Communications Adviser | Reserve Bank of New Zealand | Te Pūtea Matua
2 The Terrace, Wellington 6011 | P O Box 2498, Wellington 6140
Email: firstname.lastname@example.org | www.rbnz.govt.nz
7 thoughts on “As non-transparent, and obstructive, as ever”
Might be worth raising with the Ombudsman. Peter Boshier doesn’t stand for any nonsense.
He has, unfortunately, been quite deferential to the Bank, continuing the pattern of several predecessors. But I will give it a go.
I’ve said this before; does any of this surprise you?
No, not really. Disappoints, yes – and I’m one of many who’d like to think “Grant is better than that”, despite the evidence. But you are right that it shouldn’t really be a surprise (apart from anything else, they’ll be sitting there going “but think of the precedent it would set, if we did release something”.)
And if the government/Minister were themselves serious, they’d be urging the Bank to release the material.
“In one specific example, they indicated that they had assumed that half the planned Kiwibuild houses would displace private sector housebuilding activity that would otherwise have taken place.”
We already know that the assumption basis is grossly wrong. Phil Twyford has already confirmed that the target over the next 3 years would more than likely be 1,000 to be built a year and 9,000 to be purchased from existing private sector housebuilding. As National has pointed out, this is a Labour government Kiwibuy programme rather than a Kiwibuild program.
Fletchers only builds around 800 houses a year up from around 400 a year so that itself is an indication even building 1000 houses is a huge challenge.
The maths already indicates that Phil Twyfords 9,000 Kiwibuy will cost $5.4 billion at $600k affordable housing. That is a budget blowout of $3.4 billion already on 9,000 houses. Add the Kiwibuild of $1,000 and you now have a budget blowout of $4 billion. Gosh Steven Joyce is looking more and more accurate with his assessments compared to 7 economists that can’t do maths including BERL economists.
Bear in mind that Kiwibuild involves selling the houses at cost (approximately), so the net cost will not be that much.