Last week, Minister for Regulation and ACT Party leader David Seymour unveiled his plan to reform New Zealand’s regulatory framework. At the heart of this effort is the proposed Regulatory Standards Bill—the crux of Seymour’s strategy to address the deep-seated issues he sees in regulatory inefficiency. The bill’s consultation period is open until January 13, 2025.
A Response to Regulatory Challenges
New Zealand’s regulatory system has come under scrutiny for its inefficiency, which Seymour links to stagnant productivity and low wage growth. Speaking at the Wellington Chamber of Commerce, Seymour identified poor regulation as the primary culprit, lamenting the country’s declining ranking in the OECD Product Market Regulation Indicators—from 2nd in 1998 to 20th in 2024. “New Zealand’s low wages can be blamed on low productivity, and low productivity can be blamed on poor regulation,” Seymour asserted.
Seymour pointed to NZIER data that highlights the economic burden of inefficient regulation. A 2015 NZIER study estimated compliance costs for businesses at $5 billion annually—around 1.3% of GDP—excluding tax-related compliance. Seymour suggested that the cost of regulatory compliance has only grown since, warning that unchecked red tape “disempowers” businesses and fosters “a culture of fear and compliance” over innovation.
The Vision Behind the Regulatory Standards Bill
The proposed Regulatory Standards Bill is designed to set a new benchmark for regulatory practices. Seymour compares its potential impact to that of the Public Finance Act, which addresses public spending discipline in a similar way. The bill aims to codify principles of good regulatory governance, ensuring future regulations align with clarity, fairness, and efficiency.
Key principles outlined in the bill include:
Regulations should uphold the rule of law and avoid retrospective impositions.
Individuals’ rights to liberty, personal security, and property must not be unnecessarily diminished.
The government must provide fair compensation when regulations impair property rights.
These principles, Seymour argues, will force regulators to prioritise the real-world impact of their actions, asking, as he said in his speech last Tuesday, “Will this rule make the boat go faster, or is it just another barnacle on the ship?”
To ensure accountability, the bill proposes the establishment of a Regulatory Standards Board, which will review complaints about regulations and issue non-binding recommendations. Public reporting by the board will aim to heighten transparency and deter hasty or ill-conceived regulatory decisions.
A 25-Year Journey Toward Reform
The introduction of the Regulatory Standards Bill marks the culmination of nearly 25 years of advocacy. Seymour credits Dr Bryce Wilkinson, whose book Constraining Government Regulation Seymour says laid the groundwork for the legislation, and the Regulatory Responsibility Taskforce, led by experts including Dr Graham Scott and Jack Hodder KC, who refined the proposal in 2009.
In a speech delivered to the Wellington Chamber of Commerce last Tuesday, Seymour emphasised that regulatory reform is essential to reviving New Zealand’s productivity and restoring trust in governance. “I’m proud to stand as New Zealand’s first Minister of Regulation, with a Ministry whose job it is to look for red tape to cut,” Seymour stated. “I think it’s fair to say they’re in demand and they’re going to be busy, but they’re going to make New Zealand a better place.”
Public Engagement and Stakeholder Involvement
The government is now seeking feedback on the bill from various stakeholders, with the consultation period running until January 13, 2025. Seymour has called on farmers, tradies, engineers, teachers, and other professionals to participate, arguing that those on the ground are best placed to identify unnecessary regulatory burdens.
To amplify engagement, the Ministry for Regulation has launched the “Red Tape Horror Stories Portal.” The portal is an online tool that allows individuals to share specific examples of how cumbersome regulations impede their work. Seymour hopes the portal will provide valuable and visible insights into areas requiring urgent reform.
The initiative has already begun targeting key sectors for review. For example, the Ministry has examined regulations in early childhood education, where teachers often spend excessive time on compliance rather than teaching. Similarly, in agriculture, the Ministry is investigating how regulatory delays hinder farmers’ access to products approved in other OECD countries.
“We want to hear from tradies, farmers, teachers, chefs, engineers – every person doing productive work. If there’s red tape in your industry that needs cutting, we want to know about it.” Seymour said. “The Ministry might not be able to resolve every issue that’s brought to its attention straight away, but we are keen to understand more about experiences with regulation.”
Expected Outcomes
Proponents of the Regulatory Standards Bill argue that its principles could transform New Zealand’s regulatory environment. By introducing stricter accountability measures and requiring evidence-based decision-making, the bill aims to raise the political cost of enacting ineffective laws.
The proposed long-term benefits of such reforms are clear: higher productivity, improved wages, and stronger economic growth. However, Seymour acknowledges the challenges ahead. Implementing the bill will require cultural change within government agencies, as well as sustained political will to resist the temptation of quick fixes or populist measures.
Going Forward
Ultimately, Seymour envisions a more productive, high-wage economy supported by effective regulation. He has urged businesses and individuals to engage with the consultation process and share their perspectives.
As quoted in The Lawyer Mag, Seymour said, “If we raise the political cost of making bad laws by allowing New Zealanders to hold regulators accountable, the outcome will be better law-making, higher productivity, and higher wages.”