Appendix 3: Central agencies' statutory responsibilities

The State Services Commissioner (the 'Commissioner') and the Treasury have statutory responsibilities or powers regarding Crown entities and/or the Crown Entities Act 2004 ("the Act"), and Ministers should seek their support as appropriate.

The SSC and the Treasury are jointly responsible for the administration of the Act. The Treasury administers Part 4 (Crown entity reporting and financial obligations) while the SSC administers all other parts. The Act, State Sector Act 1988 and the Public Finance Act 1989 provide the State Services Commission and the Treasury with powers to require the production of information from Crown entities to allow them to carry out their respective functions. These complement Ministers information rights under the Crown Entities Act.

The Act provides for the Ministers of Finance and State Services to jointly issue 'whole of government' directions to entire categories of entities or to types of statutory entities (see s107). Such directions may not be issued to single entities or to smaller aggregations of entities. If departments are considering advising Ministers whether an issue could be addressed by issuing a 'whole of government' direction they should first seek the advice of the SSC and the Treasury. To the extent that the Ministers consider it necessary, consultation must occur with affected entities and stakeholders before a whole of government direction can be issued (s108).

Consultation with the SSC and Treasury is necessary on any machinery of government proposal that could result in the establishment of a new organisation that might be a Crown entity, including a proposal to establish a trust. The SSC and the Treasury have shared interests in reviewing the operations and performance of an entity or group of entities (especially if Ministers exercise their powers under s132 of the Act).

Lead Responsibilities of the State Service Commission

The Commissioner's mandate under the State Sector Act 1988 was broadened from January 2005 to include responsibilities regarding:

• providing advice and guidance on, and setting minimum standards regarding, matters of integrity and conduct in Crown entities (does not apply to Crown Research Institutes)
• providing advice on management systems and structures in Crown entities, and
• reviewing the machinery of government across all areas of government including Crown entities (the latter giving statutory recognition to existing practice).

The Commissioner must also act on a wider range of matters affecting Crown entities if directed by the Prime Minister or a Responsible Minister for an entity. The Commissioner has responsibilities under the Act to review and advise on the remuneration packages of Crown entity chief executives (see s117) and, if so directed by the Governor-General, to review and advise on collective employment agreements applying to entity employees (see s116).

In interpreting the Act, departments should seek advice from the Commissioner or the SSC on:

• the organisational form most appropriate to the functions being performed by an entity
• reviewing the internal management systems and structures of an entity
• establishing and operationalising standards and systems relating to the integrity and conduct of both members and entity employees, including as they relate to identifying and managing conflicts of interest, and
• the remuneration of entity chief executives.

Lead Responsibilities of the Treasury

In interpreting the Act, advice should be sought from the Treasury on:

• budget and expenditure information and processes
• the application of rules set down under the Act relating to: the acquisition of securities; borrowing; the giving of guarantees; the granting of indemnities; and the use of derivative financial instruments, and
• the interpretation of, and compliance with, reporting requirements.

The Treasury will be consulted as part of your normal business practice on all issues that impact on expenditure or revenue, or that have financial, fiscal or economic implications. This includes all performance and reporting issues that may influence decisions on value-for-money.