When making decisions, government bodies should act on what’s in the best interests of New Zealand as a whole, even if its not necessarily best for that government body. I would have thought that was unarguable. I mean, you expect your hand to work in the best interests of you as a unitary whole, even if it’s not in the best interests of the hand eh? Seems to me the same principle applies. The State is an artificial construct of our society and its sub-divisions like SOEs are artificial divisions of the State – the artifices exists for the benefit of the society, not the artifices.
But it seems like the Right doesn’t get that. It’s unarguable that as a country we will be better off if Kiwirail chooses to build Auckland’s new trains in New Zealand – we have the capability, the cost is in the same zone as foreign manufacturers would be able to offer, and we would gain jobs, wages, taxes, and all the associated gains that go with them, which we don’t get if the money goes overseas. But the Right’s response, as summed up by Steven Joyce in this appalling, cringing interview, is that Kiwirail must get the best commercial deal – it can only take its direct costs and benefits into account, not New Zealand’s wider interests
I hate the term New Zealand Inc with a passion because the Right uses it to reduce New Zealand to nothing more than a profit making vehicle for capitalists. But if NZ Inc does have any legitimate meaning it’s that we have to consider the impacts of decisions on the country as a whole.
What I would like to see is a fundamental redesigning of how government agencies tender for goods and services to consider the full economic costs and benefits to the country, not just that agency operating in splendid isolation.
This would see Kiwirail source the trains in this country. It would stop Solid Energy building its planned lignite-to-oil plant, which might make sense for Solid Energy alone but will leave the country with a huge carbon emissions bill.
There’s already a model for this. When NZTA undertakes projects it doesn’t look at the profit it can make because it isn’t mandated to make a profit, instead it looks at the costs and benefits to the country. It is on the basis of these cost and benefit ratios that it decides which projects to undertake (until Steven Joyce insists they build stupid projects where the costs to the country exceed the benefits, like his Holiday Highway). Why couldn’t a simplified version of NZTA’s process be used by other government agencies to decide which tenders to accept?
It just seems like common sense. But maybe the real reason the Right opposes this is because they fundamentally don’t believe in New Zealand and New Zealanders’ ability to do things for ourselves.