The Public Service Amendment Bill restructures the Public Service Act 2020 to set out a formal list of principal responsibilities for departmental and departmental‑agency chief executives, move certain independence and oversight rules into new procedural settings, and strengthen the Public Service Commissioner’s toolkit. Key institutional changes include a new section 11A describing chief executives’ duties, a change making the Commissioner required to set minimum standards of integrity and conduct, new ‘key positions’ that require Commissioner sign‑off, and expanded powers for the Commissioner to issue directions to manage national‑security risks (including restricting specified vendors, services, or products).
The bill also tightens the legal mechanics that follow transfers of functions between agencies and Crown entities (limiting which employees are covered by pre‑existing collective agreements), requires pre‑notification and annual reporting to the Commissioner about investigations of senior misconduct, introduces business‑continuity obligations for agencies, and creates a published performance‑review framework for chief executives. These are governance and operational changes that affect accountability, employment coverage in reorganisations, procurement risk, and how integrity issues are overseen across the State services.
At a Glance
What It Does
The bill inserts section 11A to list chief executives’ principal responsibilities (advice, implementation, delivery, stewardship, integrity, interoperability and long‑term advice) and makes the Commissioner responsible for setting minimum integrity and conduct standards. It creates a Commissioner‑designated ‘key positions’ regime, narrows which employees can be bound by legacy collective agreements after function transfers, and empowers the Commissioner to issue directions restricting vendors or products on national‑security grounds.
Who It Affects
Departmental and departmental‑agency chief executives, boards of interdepartmental ventures, the Public Service Commissioner and Deputy Commissioner, employees affected by transfers of functions, vendors and suppliers who contract with public agencies, and unions negotiating collective agreements that may be displaced by reorganisations.
Why It Matters
The bill shifts clarity and operational accountability into the statute: chief executives face enumerated statutory responsibilities while the Commissioner gains compulsory integrity standards and stronger intervention tools (including national‑security procurement directions). That changes how disputes over independence, employment coverage after transfers, and vendor restrictions are likely to be managed in practice.
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What This Bill Actually Does
The bill creates a new, statutory set of principal responsibilities for departmental and departmental‑agency chief executives (section 11A). Those responsibilities go beyond the historic ‘‘act independently’’ language: they require chief executives to advise Ministers, implement Ministers’ lawful instructions, deliver goods and services efficiently and economically, manage regulatory performance, maintain financial stewardship, improve inter‑agency co‑operation, and support Ministers in stewarding public institutions and legislation.
The measure distinguishes the responsibilities of host departments and hosted departmental agencies, and clarifies the limits that apply to servicing departments and interdepartmental executive boards.
On oversight, the bill replaces discretionary language with mandatory duties for the Commissioner to set minimum standards of integrity and conduct and expands the Commission’s investigative and review powers. The Commission gains express power to recover actual and reasonable costs for investigations and reviews, new authority to enter agency premises in certain inquiries, witness protections for compelled information, and a requirement to publish a framework for chief executive performance reviews.
Agencies must notify the Commissioner before starting investigations into alleged misconduct by senior employees and must report annually on investigation outcomes for the State services cohort specified in the Act.Employment mechanics receive targeted reform. The bill limits which employees can be covered by a collective agreement that follows a transfer of functions: only those appointed to positions established to carry the transferred functions can be bound by the originating agreement; other employees are covered only by the receiving agency’s pre‑existing agreements.
The reform extends these rules to transfers between public service agencies and Crown entities and keeps redundancy‑restriction rules in force with necessary modifications.To manage national‑security and national‑interest risks, Schedule 3 inserts a new clause giving the Commissioner power to direct agencies to restrict or prohibit specified vendors, services, or products. Classified security information may be relied on in those decisions; the Commissioner must consult specified security and foreign‑policy officials and the Minister, and there are procedures for notifying affected vendors and—where practicable—providing a non‑classified summary of the classified reasoning.
The Schedule also sets out how classified material is handled if litigation follows.The bill inserts operational requirements elsewhere: the Department of the Prime Minister and Cabinet must consult publicly on and prepare a long‑term insights briefing for the Prime Minister at least every three years, agencies and boards must have business‑continuity management plans and make them available to the Commission on request, and the Commissioner must publish a list of designated key positions and be consulted about appointments and performance reviews of occupants of those positions.
The Five Things You Need to Know
Section 11A makes chief executives legally responsible for implementing Ministers’ lawful instructions and for the efficient, economical delivery of their agency’s goods, services, and regulatory functions (including financial stewardship and building a financially literate workforce).
Section 17 is amended so the Commissioner must set minimum standards of integrity and conduct (previously permissive language); those standards must reflect the public service principles and values and may include other consistent matters.
Section 55A creates a formal ‘‘key positions’’ regime: the Commissioner may designate roles as key, the Commissioner must agree to any appointment to a key position, must be consulted on performance reviews, must be notified of redesigns, and must publish the list of key positions.
Schedule 3 (clauses 5B–5F) enables the Commissioner to issue directions to restrict specified vendors, services, or products to manage risks to national security or the national interest, requires consultation with security and foreign‑policy officials and the Minister, and provides a process for notifying affected vendors and, where possible, giving a CSI summary of classified reasoning.
Sections 89A–89E limit which employees are bound by legacy collective agreements after transfers of functions: post‑transfer, only employees appointed to positions established to carry the transferred functions can be bound by the originating collective agreement; other employees fall under the receiving agency’s agreements unless parties agree otherwise.
Section-by-Section Breakdown
Every bill we cover gets an analysis of its key sections.
Purpose of the public service
The bill replaces the Act’s definition of purpose with a two‑part statement: the public service supports Government policy development and service delivery and supports constitutional and democratic government while acting with a spirit of service and in accordance with the law. This reframing tightens the statutory steering language the Commissioner and chief executives must apply when making operational and policy choices.
Principal responsibilities of chief executives
This new section lists in statute the principal responsibilities of departmental and departmental‑agency chief executives: advising Ministers, carrying out lawful Ministerial instructions, ensuring efficient and economical delivery and regulatory performance, exercising statutory powers and duties, operating their agencies to achieve the public service purpose, financial stewardship, improving inter‑agency interoperability, maintaining employee integrity and conduct, responsiveness on collective government interests, and supporting Ministers as stewards of public institutions and legislation. Practically, this provides a clear statutory baseline for performance expectations and for reconciling ministerial direction with public service operations.
Commissioner must set integrity standards and wider guidance coverage
The Commissioner’s power to set standards of integrity and conduct becomes a mandatory duty and must reflect the public service principles and values. Section 19 expands which agencies receive guidance (explicitly covering State services agencies except Crown Research Institutes). That change both elevates the Commission’s role in setting behavioral baselines and widens the universe of agencies subject to such guidance.
Key positions: designation, appointment approvals, and oversight
The Commissioner may designate positions as key if they are critical to public‑service performance or to leader development. Appointments to those positions require the Commissioner’s agreement; the Commissioner must be consulted on performance reviews and notified of redesigns; and a published list of key positions is required. This creates a statutory gatekeeper role for senior talent and an additional check on chief executives’ appointment powers for strategically important posts.
Reorganisations and collective agreement coverage after transfers
These sections define which employees can be covered by a collective agreement when functions transfer between agencies or between agencies and Crown entities. The default rule is that only employees appointed to positions established to carry transferred functions can be bound by the originating agency’s collective agreement; all other employees are to be bound by the receiving agency’s pre‑existing agreements. The provisions also apply redundancy restrictions and adapt Schedule 9 clauses to Crown‑entity transfers, while allowing parties to agree otherwise.
Investigation powers, performance reviews, and national‑security directions
Schedule 3 expands investigative powers (information requests, entry to premises, witness privileges), allows the Commissioner to recover investigation costs, and creates a new performance improvement review power (agency and system level) recoverable from agencies. Critically, clauses 5B–5F permit the Commissioner to issue directions prohibiting specific vendors, services, or products to manage national‑security or national‑interest risks, set procedures for relying on classified security information, require consultation with security and foreign‑affairs heads and the Minister, and include notification and limited disclosure rules for affected vendors as well as court procedures if litigation follows.
Misconduct reporting and performance framework
Agencies must notify the Commissioner before starting an investigation into alleged misconduct by senior public service employees (those who report directly to a chief executive or board). Agencies covered by the Commissioner’s standards must also report annually on concluded investigations; the Commissioner may issue guidance and will publish an annual synthesis. Schedule 7 additions require the Commissioner to develop and publish a performance‑review framework for chief executives and consult the Minister when setting performance expectations and reviewing outcomes.
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Explore Government in Codify Search →Who Benefits and Who Bears the Cost
Every bill creates winners and losers. Here's who stands to gain and who bears the cost.
Who Benefits
- Ministers and central government: clearer statutory duties for chief executives and a single Commissioner with stronger standards makes it easier for Ministers to hold agencies to account for implementation and stewardship. This gives Ministers clearer expectations about who delivers what and how performance will be assessed.
- Public Service Commissioner: gains mandatory standard‑setting power, cost‑recovery for investigations and reviews, entry and witness powers for inquiries, the ability to designate and oversee key positions, and a national‑security direction power—significantly expanding operational oversight and intervention tools.
- National security and foreign‑policy agencies: the Schedule’s vendor‑restriction mechanism centralises a state‑level response to supply‑chain risks and requires consultation with security, intelligence, and foreign‑affairs leaders, enabling quicker protective action against identified threats.
- Senior leadership pipeline: the key‑positions regime and the formal performance‑review framework create clearer pathways and oversight for leadership development and assessment, improving transparency around critical appointments.
Who Bears the Cost
- Public service agencies and host departments: may be required to reimburse the Commission for the costs of investigations and performance reviews, implement business‑continuity plans, and comply with additional reporting and consultation duties, increasing operational and administrative costs.
- Vendors and suppliers: affected vendors specified in a Commissioner direction face commercial disruption, possible exclusion from government contracts, and limited ability to challenge classified reasoning; affected vendors also may receive only a controlled summary of classified bases for restrictions.
- Unions and employees: the new transfer and collective‑agreement rules shrink the universe of employees who can remain bound by originating collective agreements after function transfers, potentially altering bargaining coverage and redundancy protections for some staff.
- Agencies implementing vendor restrictions and regulatory change: affected agencies must reconcile procurement constraints with service delivery needs, potentially incurring transition costs and seeking replacement suppliers under time pressure.
Key Issues
The Core Tension
The bill attempts to reconcile two legitimate public‑service imperatives—strong central oversight to protect national security, integrity, and coherent delivery, and legal protections for chief‑executive independence and employee employment rights—but enhancing the Commissioner’s powers (mandatory standards, key‑position control, vendor restrictions, cost recovery) simultaneously concentrates authority and reduces transparency and contestability, leaving courts, agencies, and stakeholders to sort out where oversight ends and overreach begins.
The bill concentrates discretion in the Commission in two contrasting ways: it mandates integrity standards and gives the Commissioner power to designate key positions and to issue national‑security directions, yet many of those powers rely on subjective judgments (what is ‘‘critical to performance’’ or ‘‘risk to national interest’’). That amplifies the importance of procedural safeguards—consultation steps are required for vendor directions and the Commissioner must consult Ministers on the performance‑review framework, but statutory checks on the use of classified material and the thresholds for intervention remain narrow and could prompt disputes about fairness and reviewability.
Employment‑law friction is another unresolved area. The tight limits on who can carry forward collective‑agreement coverage after transfers aim to reduce legal uncertainty, but they reallocate bargaining coverage in ways that may not match employees’ expectations or long‑standing workplace arrangements; the statute preserves party agreement as an escape valve, but where parties disagree the outcome could be contested in the Employment Relations Authority and courts.
Cost‑recovery for Commission reviews shifts financial burden onto agencies and may deter cooperation or produce uneven incentives between central oversight and frontline delivery.
Finally, relying on classified security information to justify vendor restrictions solves confidentiality problems but creates transparency and contestability risks. The CSI‑summary mechanism provides a limited remedy, yet the Commissioner and specified agency heads can refuse to provide a meaningful summary if doing so would itself disclose classified material; affected vendors may therefore face de‑facto exclusion with constrained procedural recourse.
Litigation pathways are provided, but the practical limits on evidence and remedies in national‑security contexts leave open whether affected parties can obtain effective judicial review or compensation.
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