NZIER report to the New Zealand Productivity Commission,
February 2023

In reviewing the economics of accountability, the report looks at how the system of public accountability in Aotearoa New Zealand can contribute to increasing the productivity and effectiveness of the social assistance system, with a focus on addressing persistent disadvantage.

NZIER finds that the term ‘accountability’ has many meanings and must be defined within the context within which it is being used. But accountability is always about a relationship between someone exercising power and those on whose behalf they are exercising that power.

There are three main dimensions to accountability. The ‘democratic’ dimension puts into effect a ‘democratic chain of delegation’ from voters to parliament, Ministers, and then officials and those who deliver assistance and provide services. ‘Constitutional’ accountability promotes transparency, honesty, and ethical behaviour. A ‘learning’ dimension supports ongoing improvement at all levels.

Accountability in Aotearoa New Zealand relies heavily on constitutional elements. As a consequence, there are simultaneously claims of an ‘accountability deficit’ on the democratic and learning dimensions and an ‘accountability overload’ on the constitutional accountability front.

NZIER recommends a strengthened, more balanced approach that emphasises accountability methods that focus on learning and using the power of democratic accountability to achieve better results. Determining whether assistance is working requires listening to the people it is designed to help, learning from their experiences, and making adjustments as needed. (From the website).

This report provides input to inform the Productivity Commission's thinking for the inquiry into A Fair Chance for All: Breaking the cycle of persistent disadvantage. Record #8091