In his penchant for a slimmer, fiscally and ‘morally’ fit government that has more muscle than flesh, Prime Minister John Key has announced the merger of four major departments (Economic Development, Labour, Science and Innovation and Building and Housing) into a super entity called, ‘Ministry of Business, Innovation and Employment.’
The merger and other measures are expected to result in hundreds of job losses.
While his critics accuse Mr Key of going back on his 2008 election promise that there would be no job losses in the government sector, his supporters say that the pledge was for the first term and that times have changed since then.
“The financial crisis in Europe has compounded the government’s mounting debts and hence there is a need to trim finances in every way possible,” they said.
In enunciating the merger of government departments, Mr Key has cited the precedent set in the United Kingdom in 2009, with the establishment of the Department for Business, Innovation and Skills.
Australia made a similar move last year by setting up the Department of Industry, Innovation, Science, Research and Tertiary Education.
These departments have recently reformed their economic advice agencies to ensure quick and effective response to the current global economic situation.
Mr Key was however cautious to warn of obvious difficulties in making international comparisons.
“Both of these reforms have sought to integrate and strengthen policy capability around supporting innovation as the primary driver for improved productivity and competitiveness for business,” he said.
As part of the 2009 reforms, the UK government moved to ensure that its labour market and employment support functions were integrated with its broader economic advice agency. Australia and Canada maintain separate departments for labour market functions, as they have sought alignment for those functions closer to social development policy.
The credit for much of the changes that the Conservative Party went through in the UK over the past ten years belongs to Steve Hilton, an advertising guru.
In the early years of Prime Minister David Cameron’s leadership, he orchestrated the Tories’ re-branding as a greener, kinder party. He went on to champion policies that thrilled the right: competition in public services, elected mayors and police commissioners, welfare reform and business deregulation.
He combined the image and cultural sensibilities of a liberal hipster with a fierce conservatism and a Thatchrite’s hatred of the state.
The government is now moving from policymaking to implementation, which is increasingly a creative process. Insiders say the government wants to spend the second half of this parliament “stimulating a social response” to the policies it put in place in the first half. This means persuading charities and companies to run free schools and welfare-to-work schemes, and prodding non-politicians to run for office. Mr Hilton might have been better at this than the Downing Street technocrats.
The National Party of New Zealand is in a far less envious situation compared to UK, Australia or Canada. With a myriad of problems on the domestic economy and international trade, it has the arduous task of cutting back on external borrowing, achieve surplus over the next two financial years and maintain growth. Some harsh measures that would lead to job redundancies in the government sector would be inevitable.
But none of the moves could compromise the quality of service provided by ministries, departments and agencies.
Mr Key must be mindful of the anti-incumbency factor normally sets in the second term of any government.
