David Seymour's subtle powerplay

The soon-to-be deputy PM has already made a crucial win behind the scenes.

Margaret Thatcher used to love Prime Minister’s Questions.

If you’re not familiar, the UK Parliamentary system has a weekly procedure where the Prime Minister is subject to at least half an hour of sustained questions from the Commons. Thatcher wasn’t Prime Minister when the tradition got going but she did make a major decision that has lasted: opting not to transfer any of the questions to her cabinet colleagues, but instead taking every one head on - whether it was about foreign policy, health spending, monetary policy, anything.

As Tom Hamilton and Ayesha Hazarika argue in a fantastic book about the process, this allowed Thatcher to massively consolidate power within her own office at Number 10, rather than with Cabinet as a whole, because she suddenly had an excuse to be in every other minister’s business. After all - she could conceivably be asked about basically anything one of her ministry did, so she had to be briefed on those decisions and potentially offer input on them. Cabinet Government isn’t supposed to be quite that centralised, but PMQs gave her an excuse to make it that way.

Thatcher’s PMQ takeover came to mind while reading the Cabinet Circular¹ taking the power to review Regulatory Impact Analyses (RIAs) away from Treasury and to David Seymour’s new Ministry for Regulation, released in the dying days of 2024.

If you’re not familiar, RIAs are bits of paperwork that Government departments have to produce before they do almost anything which, in an ideal world, make clear that what they are doing makes sense. Public servants have to identify what the actual issue being addressed is, detail the action to be undertaken, detail the risks inherent in the action, and compare it to the status quo (doing nothing!) and occasionally some other options. These papers are generally proactively released to the public, giving journalists and other sickos a deeper look at the thinking behind major decisions - whether that be public servants arguing against a political decision a minister has made, uncomfortable risks involved in the policy, or just a few roads not taken².

Since the last National Government set up the modern RIA process Treasury have had a team whose job it was to assess the RIAs. This basically made sure that departments weren’t cutting corners in their analysis and also obviously gave some power to Treasury, who traditionally see it as their remit to both:

1. Stand somewhat apart from the Government of the day and speak uncomfortable truth to power when needed.

2. Stand in judgement of every other department and their spendthrift/squishy ways.

The new circular takes this power from the Treasury team and hands it to the new Ministry for Regulation.

Intuitively, this makes some sense. The Ministry for Regulation gets to regulate regulations!

But the circular also steps up the level of involvement of the new Ministry in the business of every other Government department, by pushing for earlier involvement in policymaking.

You can see this by comparing the new Cabinet Circular to the one it replaced, which was released in 2020. In 2020, it was recommended that agencies should get in touch with their quality assurance team early, before a regulatory proposal is even developed:

The Treasury’s Regulatory Quality Team and the relevant Treasury policy team will provide feedback on these areas at the request of the agency policy team. This feedback is most effectively provided in the early stages of policy development – for example, during the planning of a consultation exercise or the drafting of a discussion document, which may eventually lead to a regulatory proposal […]

It is strongly recommended that agencies seek this feedback, including from their own Quality Assurance panel or specialist. [Emphasis mine.]

While in the new circular, it is mandated:

government agencies are to contact the Ministry for Regulation as soon as possible after policy work commences on an issue that may result in a regulatory proposal being recommended to Cabinet; The appropriate point may be when preparing a first briefing for a Minister.

In other words, we are leaving a world where agencies are encouraged to contact Treasury early to one where agencies must contact this new Ministry of Regulation as early as possible.

The difference is subtle but not unimportant in the context of coalition government. Treasury at core is responsible to Finance Minister Nicola Willis, and before her Finance Minister Grant Robertson - key figures in the largest party of their respective governing arrangements. It’s hard to conceive of any future MMP Government where the largest party gives away this crucial power. As such, it makes some sense for Treasury to be marking the homework of every other Government department - as it had an institutional bias towards independence at some level and a structural allegiance to a member of the largest party in Government.

Now, agencies will technically be mandated to contact a brand new agency, controlled by a coalition partner, before even getting to a briefing for their minister. Even if Seymour or his office have no interest in modifying said proposal, it at the very least could give them the useful political intelligence of what issues other ministers are dealing with, and the options they may take.

It would be easy to get carried away here - after all as a full member of Cabinet Seymour already gets some level of oversight on all kinds of matters far from his own portfolio, as do NZ First. And there are simply so many things going on in Government that it would be hard to use this new power to massive effect without burning bridges Seymour needs for his own policy priorities³. Ministers don’t like other ministers being all up their shit.

But it is still true that Seymour, who has set the political agenda to a large degree without this power, is gaining quite a bit more. After all the circular comes alongside the larger Regulatory Standards Bill, which sets an ACT Party view of “good” lawmaking into law and creates a new board, appointed by Seymour, able to pass non-binding judgement on whether existing laws meet these standards.

The transfer of a “deputy prime ministership” - an essentially meaningless role when the Prime Minister is in the country - pales in comparison with the power Seymour is gaining over the machinery of Government. To be clear, there is also a future where this power essentially lays dormant - where agencies twist Seymour’s standards to fit whatever they want to do anyway and he doesn’t have anywhere near enough time to busy himself in the business of any other minister. Yet if he wants to use this power, he certainly has a lot of it.

1. Cabinet Circulars are the documents that set out how Government departments and ministers behave, they are not bits of law but they are treated as largely inviolable, as supplements to the hallowed ‘Cabinet Manual’ you have probably heard more about. They are very effective tools for Governments to change how governing actually happens.

2. I wrote a bit about the value of these tools when the Coalition made noises about not using them for manifesto commitments.

3. There is also, funnily enough, some weakening of the RIA process within this Cabinet Circular, with the scope of actions that don’t need a RIA slightly widened.