Story: State services and the State Services Commission

Page 1. Role of central agencies

All images & media in this story

State services

‘State services’ is a technical term for a large number of government agencies. All ministries and departments, and other state organisations such as the police and the armed forces, are included. Many Crown entities – statutory bodies such as the Accident Compensation Corporation and the Civil Aviation Authority – are state services, as are the Reserve Bank and some other institutions listed in the Public Finance Act 1989.

In June 2010 state services employed about 225,000 people, out of a total of 295,000 people who work in the wider state sector. The state sector also includes officers of Parliament, state-owned enterprises and tertiary educational institutions, but these agencies are not considered to be state services.

Legal controls on use of power

A major issue for any democracy is to ensure that the government uses power for the good of society, and to prevent abuse of power.

The first step in ensuring that government agencies are directed to a proper purpose is the law. A host of acts relating to government institutions define and limit the activities of state agencies. These laws include the State Sector Act 1988, the Public Finance Act 1989 and the Official Information Act 1982.

Democratic oversight

Government agencies also need to have appropriate democratic oversight from the elected government of the day. As a general rule ministries and departments report to government ministers and their activities are coordinated by cabinet. However, 20 politicians meeting weekly cannot manage all the work needed to coordinate the activities of the state sector.

Hot topic

Politicians avoided controversy as well as work when they passed control of state-sector employment to an independent commissioner in 1913. For more than 20 years some people had been getting worked up about the religion of those in the public service. There were calls for ‘just and equitable’ sharing of employment, and accusations that a Catholic prime minister was ‘stuffing’ the public service with Catholic appointees. However, there was no evidence of this, and the heat died out of the issue at about the time independent oversight was introduced.

Key areas and agencies

Three key aspects of government activity that must be coordinated are finance (including tax and spending), personnel (the appointment and employment of senior officials) and agenda management (including legislative priorities). Ministers are assisted in these tasks by the work of three central agencies – the Treasury, the State Services Commission and the Department of the Prime Minister and Cabinet. Between them, these departments are responsible for coordinating the work of the government and ensuring that standards of fairness, integrity and efficiency are maintained.

Power and influence

In other countries the coordination of personnel and agenda management are commonly combined in one agency. In New Zealand since 1913 the control of key personnel matters has been handled separately – firstly by a public service commissioner, and then from 1946 by a Public Service Commission, renamed the State Services Commission in 1962.

In a unique New Zealand initiative, the state services commissioner has powers of appointment of top officials. In other countries those powers are generally held by the prime minister. But though the commissioner has power, he or she is not normally involved in day-to-day policy advice, so has less influence.

By contrast, the head of the Department of the Prime Minister and Cabinet has no formal powers, but is the public servant with the highest influence through involvement in advising on all policy matters.

How to cite this page:

Mark Prebble, 'State services and the State Services Commission - Role of central agencies', Te Ara - the Encyclopedia of New Zealand, (accessed 27 February 2021)

Story by Mark Prebble, published 20 Jun 2012