The 28 Ministers of the Luxon Government. Together they hold 78 portfolios.

While the new Government repeatedly vows to cut waste from within the Government, it has created seven new ministries and abolished only two left over from the Labour Government.

A new study says that the more Ministers a government

has, the more it will spend and the more difficult it is to cut some bureaucratic functions.

New Zealand Initiative Research Fellow Max Salmon argues in a report published last week that public service bloat starts in the Beehive.

“Taking the average of parliamentary democracies of similar size to New Zealand, we have 44% more ministers, nearly triple (282%) the number of portfolios, and one and a half times (156%) as many departments,” his study found.

Salmon finds that the growth in the number of Ministers was more or less contemporaneous with the introduction of MMP in 1996.

The “baubles of office” became a reality.

“The 11 Ministers and 34 portfolios of the 1924 Government have expanded to 28 Ministers and 78 portfolios today,” he says.

“While growth has, on average, been stable, there is a notable spike in ministers from Bolger in 1998 (comprising 16 ministers and a further four outside Cabinet) to the succeeding Clark Government of 20 Ministers, eight outside Cabinet, and an additional nine portfolios.”

Thus, nine of the current Ministry’s 28 members have come from the two coalition partners, ACT and New Zealand First.

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“Maintaining successful coordination and cohesion in a large disparate party or coalition requires the leader to cater to some demands of their political partners and reward them with ‘bonus portfolios,” he says.

“From a public choice perspective, the aim of the majority group in Government is to maintain as much policy power and discretion as possible while appeasing their less-powerful partners.

“Less-powerful partners tend to have narrow demands or policy goals.

“Thus, cohesion may be achieved by carving out a new and limited portfolio for the less-powerful group.

“In this way, the smaller party policy gains control over their specific area, while the more powerful group maintains control of the wider portfolio.

“For example, by establishing a racing portfolio, a government may satisfy internal elements concerned with racing while maintaining its hold on the wider ‘Sports and Recreation’ portfolio.”

That need to satisfy narrow demands or policy goals is seen with the dispropoprtionate number of Associate Ministers from the coalition partners.

They account for nearly half (12) of the 23 Associate Ministers in the Ministry.

Though Associate Ministers look like full ministers with offices in the Beehive, staff, and membership of the Executive Council, they are severely more constrained in what they can do.

The Cabinet Manual says responsibility for a portfolio always rests with the “portfolio” or “principal” Minister.

“Associate Ministers should take particular care to avoid making public statements or taking initiatives of any sort without the knowledge and approval of their portfolio Minister,” the manual says.

ACT leader David Seymour has only one full portfolio: the new Minister for Regulation.

Otherwise, he is an Associate Minister in two portfolios: Education and Health, where he has very specific responsibilities, partnership schools and Pharmacy.

Salmon argues that, along with the substantial creation of new full Ministers, the associate Ministers contribute to considerable overlap between Ministries in the Beehive.

And this interests the Initiative because he argues that it leads to inefficiencies.

Salmon argues that such a large Ministry with so many portfolios impacts the ability of the Prime Minister to manage their Government.

But management is the foundational leadership attribute that Prime Minister Christopher Luxon likes to promote. He claims that he will manage his Cabinet like an executive team, set them goals, and define key performance indicators for them.

But Salmon says: “Consider the role of the Prime Minister in steering Cabinet.

“Maintaining good working relationships with ministers is central to the position and crucial to the Prime Minister’s ability to direct the overall direction of government.”

“With only a finite amount of time at their disposal, the Prime Minister cannot effectively maintain oversight of all the 28 ministers’ programmes.

“Furthermore, as Cabinet acts as the default co-ordinating body of the Executive, that nearly a third of the Executive sits outside Cabinet adds organisational stress and further hampers oversight issues.

“Consider that significant current portfolios held by ministers outside Cabinet include Environment, Tertiary Education, and Climate Change.”

Salmon cites Chris Bishop, the Minister in Charge of RMA Reform (a new portfolio), the Minister of Housing, and the Minister for Infrastructure, as an example of how the proliferation of ministries complicates decision-making.

But Chris Penk, who sits outside Cabinet, is Minister of Building and Construction, but he also holds two other portfolios (Land Information and Veterans and he is an Associate Minister of Defence and an Associate Minister of Immigration.

Salmon says that co-ordinating his work with other ministers is “likely to be challenging.”

 He also says there are other dangers to having such a large executive.

“As the number of ministers increases, the Executive becomes more vulnerable to factionalism.

“A larger number of ministers often reflects a broader diversity of policy preferences among its members.

“More policy preferences mean a more diverse range of perceived directions that government should move in within the executive, and the greater the likelihood that groups will coalesce around these differences and cause coordination issues for the government.”

He says several studies have shown that having more finance ministers and larger Cabinets correlate with larger budgets

 in general.

“Looking at ministerial effect, several studies have shown that having more finance ministers, and larger Cabinets in general, correlate with larger budgets.

 Currently, New Zealand has two full financial portfolios, Revenue (Simon Watts) and Finance (Nicola Willis), with three associate finance portfolios (Chris Bishop, David Seymour and Shane Jones).

Setting aside the wide political divisions between the associate Ministers and the main Ministers, Salmon says that when there are more ministers, governments tend to spend more, run larger deficits, generate higher revenues, increase transfers, spend more on government wages, and rely more on labour taxes.

“This is best explained by the notion that ministers benefit from spending in their area, either because of their policy preferences or to demonstrate their competence.”

And in a comment that is unlikely to be welcome in the Beehive but which reflects a widely held view among those who have close and frequent interaction with the Beehive, it often seems that more is less.

“The more ministers a government has, the lower the standard must become for acceptance into Cabinet,” he says.

And he warns that a position in Cabinet is not merely a political achievement or reward.

“It places the minister at the head of several functions of Government. This would appear to have significant explanatory power for the performance of the recent Labour Government, whose inability to enact policy must be partially attributable to the quality of its ministers.”

There are other issues that he has not discussed.

Sir Geoffrey Palmer argues that the size of the Executive these days calls for an increase in the number of MPs because the Executive is obligated to vote together at party caucus meetings and when it becomes larger than 50 per cent it effectively stifles the chance of back bench MPs having any impact on policy change.

And the size of the Ministry directly impacts the Government’s hopes of cutting public sector waste.

“Once established, bureaucratic structures (such as departments and portfolios) tend to resist disestablishment,” says Salmon.

“Established routines, vested interests, and the challenges associated with organisational change stymie reform.

“A ratchet effect likely amplifies this resistance, making it harder to roll back growth.

“ Over time, these new positions and departments become valuable political tools for government leadership, particularly during electoral cycles.

“Furthermore, New Zealand’s continuous ministerial growth is facilitated by the lack of legislative checks on Executive size, the number of departments, and the number of portfolios. Consequently, New Zealand’s Executive has evolved from a manageable garden into a tangled forest of portfolios, ministers, and departments.”

However, cutting whole functions would mean cutting portfolios. Unlikely.