H stands for Hide and much, much more

Rodney Hide has stumbled into the H world: say one thing, do another, about perks. Then in Christchurch on Wednesday there was H for hubris as he disparaged “do-nothing” John Key. In Hide’s actual work as a minister, however, the H stands for high-aiming.

His aim: to revolutionise the way law is made. His mechanism: a new law, plus new procedures, to parallel the transparency Ruth Richardson’s Fiscal Responsibility Act injected into government budgeting.

That act required governments to state how they intend to run their finances and then front to Parliament for digressions. The scope for sleight of hand was greatly narrowed.

That’s how Hide wants law to be made. And he wants private property rights to be a core right in our constitution.

In August he persuaded an initially sceptical Bill English to join him in a statement requiring ministers and senior officials to certify, with signatures, that proposed new legislation and regulation is required in the public interest, all practical alternatives, including “private arrangement”, have been considered, benefits exceed costs, entitlements are clear and conform to best legislative practice and implementation issues, costs and risks have been addressed.

If a new law deviates, the minister is to say why. And officials are to give free and frank advice on such a proposal.

Ministers can still make laws that don’t comply but will have to be open about the disbenefits along with the benefits. And signing that off may cause them to think twice.

Hide’s and English’s statement also required officials to stocktake by October 31 all existing legislation and regulation in their portfolios. Almost all did and the rest are close. They must also submit an annual quota of that law to the new-law test. The first tranche is due next June.

Next step: in effect turn the August statement into law. Last week senior ACT member Graham Scott, former Treasury Secretary, tabled a report by a team of high-powered lawyers and economists on what could be done with Hide’s Regulatory Responsibility Bill, stalled in the last Parliament.

Scott’s rewritten version is ground-breaking.

It sets out “aspirational” principles for law-making. These include that new law must not diminish property rights, must not take property unless it is in the public interest and fully compensated. Also new law must be made only after consultation with those affected and accompanied by a full cost-benefit evaluation. It must be “the most effective, efficient and proportionate response”.

Note the property rights emphasis. In Sir Geoffrey Palmer’s 1990 Bill of Rights Act property rights were mentioned only in passing, in a section on “unwarranted search and seizure”.

Scott’s bill would require ministers to certify that a new law conforms to those principles or say why not. People would be able to go to court to get a declaration that it doesn’t. In deciding other cases, the courts would have to interpret legislation against those principles. And officials would have to review existing law and say whether it conforms to the principles.

This is radical — “a world first”, Hide says. Hide — for an instant putting on an H-for-humble hat — protests that it is not constitutional change. But that is on a narrow lawyerly reading of the constitution. If something significantly changes the way power is exercised — for example the Official Information Act in 1982 — that in political terms is constitutional change.

And, just as the Fiscal Responsibility Act, which Hide’s narrow-cast lawyers would also say was not constitutional change, has constrained the handling of the finances, the Scott version of Hide’s less ambitious original bill would change the way ministers — and Parliament — make laws.

Whatever Key thought he was getting when he agreed to appoint Hide Minister for Regulatory Reform, he now has a vehicle, thanks to Hide, through which to deliver the “bonfire of regulations” he promised ACT in March.

How seriously should we take Scott’s report?

First, note that the cabinet gutted Hide’s radical ideas for local government in his grand but woolly cabinet paper in April. Not much survived councillors’ lobbying and the cabinet mill.

So when Hide turns up with Scott’s bill (reworked a bit by Parliament’s law drafters), will it be gutted, too? That English went along with the August statement suggests not. But new law is a bigger step than an administrative edict.

If Hide gets Scott’s bill through, will it work? It is “aspirational”, not mandatory. It has only the same leverage as the Bill of Rights Act, which requires disclosure of inconsistencies in new law with any right in that act but does not rule it out. Parliament can do what it likes — and does.

But judges do take note. A habit develops. A law like the Bill of Rights or Hide’s bill may not be observed to the letter. But it influences behaviour. Hide might yet prove his claim to be the Key minister who effects the deepest change.