B. Roles

Ministers

Ministers' roles in relation to Crown entities are to oversee and manage the Crown's:

• interests in the entities, which are broadly to ensure entities:
• do the right things (e.g. in line with legislation, government goals and, if a Crown agent or ACE, applicable policies and directions)
• do the right things well (i.e. effectively, efficiently and in a manner consistent with their status as instruments of the Crown), and
• relationship with the entities.

The relationship between a Minister and a Crown entity is more arm's length than between a Minister and a department. Minister's responsibilities are described in the Cabinet Office Circular CO (99) 13 Ministers' Roles and Responsibilities in Relation to Crown Entities⁸; many of these responsibilities are expanded on in this guidance by describing how departments can support their Ministers in relation to Crown entities.

Specific powers of Ministers in relation to Crown entities are noted in Appendix 1.

Boards

The role of each board is to:

• be the governing body of the entity
• exercise the powers and perform the functions of the entity
• make decisions (whether themselves or through delegates) about the operation of the entity, and
• ensure that the entity's functions are performed efficiently and effectively.

A board is expected to engage constructively and professionally with the responsible Minister and his/her department. The Ministers of Finance and State Services wrote to boards in December 2004, after the passage of the Act, setting out the Government's expectations of boards (Appendix 2). The letter stresses the need for no surprises, working together for common outcomes, and responsible financial management.

Central Agencies

The Minister of Finance, the Treasury, the State Services Commissioner and the State Services Commission have statutory responsibilities regarding Crown entities and the Act (Appendix 3). Ministers, and departments supporting Ministers in their interactions with Crown entities, should seek the support of the central agencies when appropriate.

Central agencies advise their Ministers on how the Public Sector Management system is performing (including, at an aggregate level, how entities are performing), and support their Ministers' decision-making and statutory approval roles under the Act. They advise on how departments are performing their monitoring functions.

Departments

The Act describes Ministers' roles in relation to Crown entities. While the Act does not describe a role for departments in relation to Crown entities, departments will help Ministers discharge their responsibilities unless directed otherwise. A department's role derives from its status as an agent of the Minister. Ministers may use other agents, including staff from their private offices, for some tasks, but even in these situations the department will normally have a policy and/or Vote administration role to play.

Ministers usually expect, and will normally receive, the following support services:

• an initial briefing on each entity on becoming Responsible Minister that, among other things, gives the Minister a 'heads up' about how to work with the type of entity (Crown agent, ACE or ICE), and provisions in the entity's empowering legislation or other legislation that materially modify core governance provisions in the Act
• briefings to support Ministers' engagement with entities on strategic matters
• ongoing briefings on each entity that identify emerging governance or performance issues that require the Minister's attention
• management of all processes relating to board membership, including appointments, re-appointments, setting members' fees, helping the board induct and train new members⁹, and ensuring compliance with Cabinet expectations and processes in respect of these matters
• transmittal of information to each entity about relevant decisions and/or changes in policy by the Government, relevant government processes, especially the Budget, and the Government's expectations of the entity
• critical review of the entity's draft Statement of Intent (SOI)
• negotiation of an annual output agreement and any protocols (e.g. relationship protocols) as required by the Minister
• monitoring of each entity
• advice on the compliance of Crown entities with their legislation, and
• where appropriate, leadership and/or coordination of departments and entities working within a sector, or working in pursuit of interdependent results.

⁸ This Cabinet Office Circular is about to be updated to take account of the Crown Entities Act 2004 and other developments. The 2006 Circular will be available from www.dpmc.govt.nz/Cabinet/circulars

⁹ Boards must arrange appropriate induction and training of members.