Vigilance against diminution of standards imperative

Sir Anand Satyanand – 

Many contemporary descriptions of Aotearoa New Zealand focus on the country’s natural beauty, its remoteness and what is thought to be the friendly character of its people.  These all add up to presentation of a country which is pleasant to visit as well as to live within.

At another level, our country has enjoyed a long unbroken strand of continuing democracy and an electoral system, now in place for 20 years that ensures participation by minority groupings.

There is an approach exhibited here towards the indigenous Maori population that is characterised by partnership rather than conquest.

All of these above factors tend to push to the background the pervading importance of a sound financial system, which can sometimes be taken for granted.

Reserve Bank tasks

For the past 80 years, the Reserve Bank of New Zealand (RBNZ) has husbanded the task of keeping the economy stable and people’s faith in it constant.

In the past 30 years, successive governments have provided the RBNZ with sufficient powers and tools to ensure that it maintains stability of prices and control over inflation.

It is a matter of general knowledge in the community that every few weeks, in fact seven times per year, there will be an announcement by the Bank expressing and settling the Official Cash Rate.  This is the interest rate set by the Reserve Bank to meet the inflation target that has been specified in the agreement it has with the government of the day.

The rate influences more generally the price of borrowing money in New Zealand and thus enables the RBNZ to influence the level of economic activity and inflation.  Added to this, the Reserve Bank has supervisory powers over operation of companies undertaking business in banking, insurance and dealing in finance.

Financial Architecture

It can be said that governments need to provide the architecture within which business can function. It can also be said that mechanisms like the Reserve Bank ensure distance between the two, but also control and sanction when either of the latter is called for.

In any examination of governance, it is important to see that the institutions are stable and can withstand scrutiny for understandable and fair practices.

The confidence of the business community and the faith of the public depend on this scrutiny being thorough.

New Zealand has developed over time, and in particular during the past 20 years, an internationally respected reputation for accountability and transparency of institutions which has ensured, for example, a prominent and positive placement on the Corruption Perception Index of Transparency International, published since 1993.  In a relatively small country, comprising 268,000 square kilometres and housing 4.6 million people with a small economy, a GDP generating $240 billion, this has required continued activity by a number of players.

Empowering Legislation

Parliament has its part to play with empowering legislation and the ability to conduct inquiries.  The Courts provide recourse for criminal breaches to be prosecuted or for civil claims to be pursued.

Supervisory agencies such as the Ombudsman and the Auditor General are accessible to the public for complaints about maladministration and wrongdoing to be brought to account.  The press plays an important role in bringing to light things which are inadequate or have gone wrong.

There can be no guarantee of continuance and there has to be maintained an ongoing attitude of vigilance against diminution of standards.  Money laundering and illegal practices can flower easily if this vigilance is not maintained.  Central in all of this, is the positioning of suitably skilled and fearless holders of public office to make sure that standards are maintained.  Our country is currently well regarded for operating on free market principles in an open way which provide pathways for an agriculture based export industry supported by manufacturing, technology and services.

Long may all this continue.

 

Sir Anand Satyanand is former Governor General of New Zealand (August 2006 to August 2011) in whose name we conduct the Indian Newslink Sir Anand Satyanand Lecture every year. He is currently Chairman of the Commonwealth Foundation, London.

The Sixth Annual Indian Newslink Sir Anand Satyanand Lecture will be held on Monday, July 25, 2016 at Pullman Hotel Auckland. Reserve Bank of New Zealand Governor Graeme Wheeler will be the Guest Speaker with Victoria University (Wellington) Professor Sekhar Bandyopadhyay as Master of Ceremonies and Business Journalist Rod Oram as the Summation Speaker. The formal, Black Tie event includes Cocktails (from 630 pm to 730 pm), Dinner and Speeches. Tickets priced at $150 plus GST per person (tables seating ten persons at $1500 plus GST) are available. For registration and more information, please call (09) 3910203 or (09) 5336377. Email: editor@indiannewslink.co.nz

 

Add a Comment