Nathan Surendran's Submission to the RSB (NZ) Consultation

a critique from the vital perspectives of the energy cost of energy (ECoE), biophysical limits, and the realities of the coming age of energy disruptions

Submission to the RSB Consultation - Nathan Surendran

To the Finance and Expenditure Committee,

I am submitting this document to collate and present the significant points from various expert perspectives regarding the Regulatory Standards Bill (RSB) 2025. I believe these points form a compelling case against the Bill.

My background is as a professional engineer, specialised in energy systems, dynamic modelling and resource depletion.

Thank you for the opportunity to comment on the proposed Regulatory Standards Bill (RSB). In the spirit of my "Murihiku Energy Strategy" submission (bit.ly/NS_MESS - contains comprehensive references), I aim to provide a critique from the vital perspectives of the energy cost of energy (ECoE), biophysical limits, and the realities of the coming age of energy disruptions. I believe that an understanding of these fundamental biophysical realities is critical to strategic decision-making, far beyond the narrow financial metrics typically applied.

The Regulatory Standards Bill, as presented, aims to improve the quality of regulation in New Zealand by establishing principles of "good law-making and economic efficiency" and reducing "unnecessary and poor regulation". David Seymour states that regulation acts as a "tax on growth" in a high-cost economy, and the bill seeks to promote productivity by ensuring transparency and accountability in regulatory decisions. However, from a net energy lens, this approach is fundamentally misaligned with the biophysical realities our society faces.

Overall Critique: A Foundation Built on Energy Blindness

The proposed Regulatory Standards Bill is deeply problematic because its underlying philosophy is rooted in a conventional economic paradigm that is "energy blind". Conventional economics largely ignores the fundamental role of energy in underpinning economic output, often reducing human economic activity solely to questions of access to energy, and failing to include energy in production functions. This framework is based on the flawed assumption that the economy is a financial system capable of infinite expansion, rather than an energy system subject to physical laws and limits.

The bill's focus on "economic efficiency" and the reduction of "red tape" to boost "growth" demonstrates a profound misunderstanding of how real economies function. As Steve Keen and others have observed, "Capital without Energy is a sculpture, Labour without Energy is a corpse". The notion that we can simply "green" our energy supply while maintaining current levels of growth and consumption is not credible. Therefore, policies that prioritize economic growth without acknowledging the biophysical constraints are likely to be short-sighted and lead to unnecessarily poor outcomes.

Critique from an Energy Cost of Energy (ECoE) Perspective

The concept of Energy Cost of Energy (ECoE) – or its inverse, Energy Return on Investment (EROI) – is paramount to understanding economic viability. ECoE quantifies how much energy is consumed in the process of accessing or producing energy itself, determining the surplus energy available for all other economic purposes. As the ECoE rises, less surplus energy remains for the broader economy, leading to an inevitable contraction of prosperity.

The RSB's insistence on "economic efficiency" principles, divorced from a biophysical understanding of ECoE, risks reinforcing a system where perceived monetary value masks diminishing energetic returns. The idea that economic growth can be sustained simply by "freeing the flow of capital" or cutting "red tape" ignores that money itself has no intrinsic worth; it only commands value as a claim on the output of the "real" (energy) economy. If the cost of energy rises as a proportion of economic output, we become poorer, regardless of financial metrics. The bill's approach is designed to facilitate growth, yet the real economy is heading into contraction due to rising ECoEs. This approach essentially attempts to break a rock with a twig – the financial system will break, while energy realities remain unaffected.

Critique from a Biophysical Limits Perspective

The mainstream energy narratives, which the RSB implicitly supports, assume that the energy abundance of carbon civilization can be maintained indefinitely. However, we contend that today's energy surpluses cannot be maintained in a carbon-constrained world. The limitations of renewable energy, including significant material input requirements for their manufacture and deployment, mean that they cannot simply replace fossil fuels on a like-for-like basis to support continued energy-intensive lifestyles without a much smaller economy. The physical realities of finite resources set the boundaries within which our economy and society must operate.

The RSB's focus on deregulation and economic freedom does not recognize this fundamental hierarchy where biophysical reality sets the ultimate boundary. Instead, it promotes a "technological fix" mentality, prioritizing narrow technological solutions even when problems are rooted in systemic social, economic, and cultural issues. This approach neglects the need for "sufficiency"—reducing overall demand—which would make meeting energy needs from renewable sources proportionately easier. Without integrating perspectives on planetary boundaries and resource depletion, the bill encourages policies that could lead to further "overshoot" of ecological carrying capacity.

Critique from the Age of Energy Disruptions Perspective

We are entering a period defined by declining net energy and increasing energy insecurity and supply disruptions. This future will be characterized by price volatility and shortages of critical fuels, rather than smooth sailing. The RSB, by emphasizing abstract "economic efficiency" principles, fails to adequately address the urgent need for resilience in our energy systems and society.

The current geopolitical landscape offers stark examples of these disruptions. The proposed blockade of the Strait of Hormuz, a critical choke point through which 20% of global oil passes (with 80% of that bound for Asia), vividly illustrates the fragility of our interconnected energy system. Such an event, whether a "revenge and suicide action by a desperate regime" or a result of escalating tensions, could involve attacking tankers, using limpet mines, ballistic missiles, or even mining the entire Strait. New Zealand, already vulnerable due to geographic isolation and the closure of the Marsden Point refinery, relies heavily on these long and increasingly unstable supply chains for its critical diesel fuel, the "workhorse of the global economy". A significant disruption of this nature would not only cause catastrophic fuel shortages and price spikes, far exceeding those of the 1970s, but also expose the profound energy blindness of policies that do not prioritize local resilience and a strategic reduction in energy demand. The focus on abstract "economic efficiency" in the RSB completely overlooks these very real, escalating geopolitical risks and the imperative to shift towards a more localized, resilient energy future. Here’s an analysis from Australia of how much oil is dependent on Middle Eastern Crude in this part of the world: https://crudeoilpeak.info/australian-diesel-import-dependency-on-middle-east-oil-update-april-2025

Next Step: Therefore, a critical next step involves conducting detailed, dynamic geopolitical risk assessments for key energy supply routes and chokepoints, such as the Strait of Hormuz, integrating these findings into national energy strategy scenarios and resilience planning, and explicitly defining the costs of inaction against such foreseeable disruptions.

Historically, energy infrastructure has been large-scale, centralized projects. However, the coming disruptions demand a shift towards distributed energy generation systems like rooftop solar PV and battery storage, which are critical for local community resilience against natural hazards and supply constraints. The bill's generalized pursuit of deregulation risks undermining the specific, context-dependent planning and investment required for a resilient transition. It promotes an "un-critical consensus" around net-zero targets and renewables that does not fully account for resource limitations and material depletion. We need a holistic, biophysical understanding to properly assess risks and develop coherent, fit-for-purpose government policy.

In conclusion, the Regulatory Standards Bill, in its current form, operates under an outdated and fundamentally flawed understanding of how energy, economy, and the environment interrelate. Its emphasis on a narrow definition of "economic efficiency" ignores the critical insights from biophysical economics, the undeniable reality of rising ECoE, and the impending age of energy disruptions. Rather than freeing up the economy for growth, it risks pushing New Zealand further into unsustainable pathways and unpreparedness for inevitable contractions.

A truly robust energy policy and regulatory framework must integrate a deep understanding of these biophysical realities, prioritizing resilience, sufficiency, and a planned transition to a lower energy throughput society.

Alternative action that parliament should take: I propose a comprehensive and independent biophysical systems modeling exercise, such as the MEDEAS model, to assess the true energetic and material costs and benefits of existing and proposed regulations, ensuring that all future policy decisions are grounded in physical reality rather than solely financial assumptions. This would also encompass an explicit assessment of the risks of inaction or maintaining current flawed assumptions.

Other concerns from notable submissions I support:

Here are the key arguments and observations from other notable submissions that I have reviewed and would like to submit in favour of:

Fundamental Opposition and Ideological Underpinnings

1. According to Jane Kelsey, the RSB is an ideological vanity project of the ACT political party, which secured less than 9% of votes in the 2023 election.

2. According to Jane Kelsey, the Bill was originally designed by ACT’s radical think tank, the Business Roundtable, in 2001 and introduced to Parliament by ACT in 2007. Three variations have been rejected by Parliament over the past 18 years.

3. According to Jane Kelsey, the Bill’s reintroduction is the result of unprincipled backroom horse-trading that undermines the legitimacy of MMP and makes it appear undemocratic and unaccountable.

4. According to Max Harris, the RSB is far-reaching and dangerous, aiming to smuggle in libertarian principles that ultimately seek to protect corporate profit, boost individual private property, and 'chill' legislatures away from regulating in the public interest.

5. According to Max Harris, a central ideological driver of the RSB is libertarianism, the guiding ideology of the New Zealand ACT Party, which has historically sought to use law to limit government spending, balance budgets, reduce regulation, and cut progressive taxes, believing government intervention in the economy must be minimized.

6. According to Max Harris, in practice, libertarian ideology has preserved and boosted the wealth and power of a small group of people. He notes Milton Friedman's extreme hostility to government regulation, even opposing seatbelt and bicycle helmet laws, and his goal to elevate libertarian principles to the level of human rights by establishing an economic constitution.

7. According to Max Harris, this Bill must be regarded as an attempt to lock-in libertarian ideology, specifically to boost the twin goals of profit and property. He believes this ideology is not supported by a majority of people in New Zealand and its enactment would have deeply antisocial effects and detrimental consequences for public health, workplace safety, and environmental protection.

8. According to Jonathan Boston, the RSB can be reasonably characterized as an ‘everything Bill’ because it seeks to influence and constrain the contents of every statute and regulation, bringing them into conformity with a particular societal vision that many critics fear will create an inhumane, unjust, and ecologically barren dystopia, especially hostile to the principles of Te Tiriti o Waitangi and the welfare state.

9. According to Ganesh R. Ahirao, the Bill imposes an economic framework underpinned by a narrow worldview of interests, property, and rights. This framework asserts the primacy of the individual, aligns with a narrow 17th-century view of a uni-directional social contract, assumes the current distribution of interests, property, and rights is *Pareto optimal*, ignores how such property and rights were acquired, and implicitly assumes no externalities, meaning no responsibilities or obligations on those who possess interests, property, and exercise rights.

10. According to Ganesh R. Ahirao, the Bill’s logic is breathtakingly circular, concluding that regulation that protects existing rights and interests is a goal in and of itself, without presenting an explicit objective against which the exercise of responsibility can be assessed.

Flawed Process, Lack of Consultation, and Disregard for Te Tiriti o Waitangi

11. According to Jane Kelsey, the Bill’s process and content show contempt for the fundamental foundations of Te Tiriti o Waitangi and democratic government. This exposes the hypocrisy of ACT’s claims that the Bill is about "best practice", transparency, accountability, and evidence-based regulation.

12. According to Jane Kelsey, the “responsible” Minister explicitly rejected his own ministry’s advice to include the Crown’s obligations under Te Tiriti o Waitangi in the Bill’s “regulatory principles”. Instead, he favored principles designed to privilege those with wealth and private property, making this a re-run of ACT’s failed Treaty Principles Bill.

13. According to Jane Kelsey, the Minister’s initial consultations were limited to members of the Regulatory Responsibility Taskforce, appointed in 2009 by a previous ACT-National coalition to advance ACT’s project. In contrast, the Minister decided against conducting even targeted engagement with Māori and other experts.

14. According to Jane Kelsey, the Waitangi Tribunal has rejected this latest attempt to enact ACT’s Bill.

15. According to Jane Kelsey, a large part of the Preliminary Treaty Impact Analysis was redacted to “maintain legal professional privilege,” which indicates strong concerns were raised about constitutional and legal issues that the Minister did not want known.

16. According to Jane Kelsey, the Minister peremptorily dismissed the overwhelming number of submissions (88% opposed) that rejected the Bill as “not adding anything meaningful,” despite the Discussion Document promising that submission information would determine the Bill's final shape.

17. According to Jane Kelsey, Māori would face yet another provocation which, as the effects accumulate, would make the mobilizations over the Treaty Principles Bill pale by comparison.

18. According to Jonathan Boston, the RSB is especially hostile to the principles of Te Tiriti o Waitangi.

19. According to Jonathan Boston, the list of principles in Clause 8 is highly restricted and deliberately skewed in a very narrow philosophical direction, with honouring the principles of Te Tiriti o Waitangi being one of the many relevant principles missing.

20. According to Jonathan Boston, the Bill could significantly reshape legislation affecting Māori due to the absence of any reference to Te Tiriti o Waitangi, its principles, or the rights and interests of Māori. This is clearly deliberate, and in effect, the Bill appears designed to delegitimize the Treaty and its associated principles, imposing "Anti-Treaty principles".

21. According to Jonathan Boston, the Bill would deem any efforts to achieve substantive equality for Māori as inconsistent with “good law making,” and the proposed Regulatory Standards Board would essentially become an “Anti-Waitangi Tribunal”.

22. According to Max Harris, the process of passing the Bill has lacked what would be expected for constitutional change, with no widespread consultation and no consultation of Māori.

23. According to Max Harris, the Waitangi Tribunal has slammed the Bill for its failure to comply with the principles of Te Tiriti o Waitangi. He also notes the inconsistency and “rank hypocrisy” of the Bill compromising the very principles it purports to safeguard.

24. According to Ganesh R. Ahirao, the Bill has involved breaches by the Crown of Te Tiriti principles of partnership and active protection, as found by the Waitangi Tribunal, by failing to meaningfully consult with Māori before Cabinet decisions on May 5, 2025, and by introducing the Bill without such consultation. He states that it risks further breaches if the Crown enacts the Act without consulting meaningfully with Māori.

25. According to Ganesh R. Ahirao, the 21st-century social contract relevant to Aotearoa must encompass iwi/Māori, collective/community, and future generations as parties to that understanding, and recognize the respective interests and rights of maunga and awa with personhood status.

Critiques of the "Principles of Responsible Regulation”

26. According to Jonathan Boston, the Bill seeks to establish a ‘benchmark for good legislation’ but there is no universally agreed benchmark, certainly not in relation to the *substance* of legislation, and the quest to impose such a benchmark will prove forlorn.

27. According to Jonathan Boston, there are numerous principles and considerations (constitutional, philosophical, legal, administrative, political, ethical) that affect judgments about 'good legislation,' and people often disagree on these, leading to legislation being amended or repealed by subsequent governments.

28. According to Jonathan Boston, there are dozens, if not hundreds, of distinct ethical values (e.g., human dignity, liberty, justice, equality, sustainability) that are often in tension or direct conflict and cannot be reduced to a single norm. This means policy trade-offs are inevitable, and attempting to draft legislation consistent with every conceivable ethical value or principle is simply not possible.

29. According to Jonathan Boston, high-level goals like ‘justice’ or ‘the public interest’ (as implied by Clause 8(j)(iii)) beg further questions because philosophers have provided radically different answers to what they entail.

30. According to Jonathan Boston, the Bill’s proposed ‘principles of responsible regulation’ (Clause 8) encompass only a small fraction of the principles regarded as relevant for good law-making and are deliberately skewed in a very narrow philosophical direction. This exclusion means it is inevitable that most existing and future legislation will be inconsistent with the RSB.

31. According to Jonathan Boston, the proposed legislation is internally inconsistent, for instance, requiring consideration of 'public interest' while the 'liberties principle' excludes it as a ground for restricting liberty.

32. According to Max Harris, while some principles in Clause 8 sound uncontroversial, a closer reading reveals they introduce new ideas prioritizing property, the individual, and a particular worldview. He notes a narrow conception of the rule of law is presented.

33. According to Ganesh R. Ahirao, the clause 8 principles of responsible regulation omit, or ignore, any overarching objective against which the exercise of such responsibility can be assessed. He also notes the Bill accepts a narrow version of a social contract focused almost exclusively on the uni-directional relationship between individuals and government.

Issues with Property Rights and Regulatory Takings

34. According to Jane Kelsey, Minister David Seymour confirmed the Bill is essentially about protecting private property and wealth.

35. According to Jane Kelsey, ACT’s previous attempts to introduce a regulatory takings rule to New Zealand law have failed, with Treasury rejecting such a principle in 2011.

36. According to Jane Kelsey, the version of “regulatory takings” in the latest Bill is vague and potentially fetters swathes of essential regulation, including National Party policies like breaking up the supermarket duopoly. She finds it ironic that ACT opposes state monopolies but proposes a rule protecting private monopolies that "rort" customers and suppliers.

37. According to Jane Kelsey, there is no definition of “property” in the Bill, and no threshold for the nature and extent of “impairment” of property, which would apply to measures impacting value or profitability. The future impact of regulatory change is necessarily speculative, opening the door to limitless arguments about how a new law would impact “property”.

38. According to Jane Kelsey, this rule could impede government action on anti-competitive dominance in various markets, despite National and ACT's commitment to free markets.

39. According to Jane Kelsey, examples of "impairment" include issuing compulsory licenses for vaccines, new restrictions on tobacco/alcohol sales, introduction of capital gains/wealth/digital services taxes, designation of historic buildings, recognizing mana whenua rights to redress Tiriti breaches, climate change measures impacting profits/carbon credits, tightening fisheries quotas, not renewing mining permits for environmental reasons, or tightening construction regulations.

40. According to Jane Kelsey, there is no guidance on “fair compensation,” and in international investment law, compensatory awards include speculative lost future profits with compound interest. She emphasizes the need for the select committee to understand the definition of property, the standard of impairment, the form and extent of compensation, and its consequences for regulation.

41. According to Jonathan Boston, equally forceful objections can be levelled against the proposed principle in Clause 8(c) regarding the taking or impairment of property. This principle is consistent with previous versions, except 'fair compensation' replaces 'full compensation' and 'good justification' replaces 'public interest'.

42. According to Jonathan Boston, the proposed principle is an unorthodox legal principle, especially regarding compensation for 'impairment', and it would establish a very strong doctrine of regulatory takings foreign to the New Zealand constitution.

43. According to Jonathan Boston, attempting to apply this principle could greatly increase the fiscal costs of new regulatory measures. For instance, new environmental regulations might require compensation for affected property owners, effectively replacing 'polluter pays' with 'non-polluters pay', which he finds morally problematic, comparing it to compensating slave owners.

44. According to Jonathan Boston, it will be hard to determine 'fair compensation' and identify the 'beneficiaries,' illustrating with the example of sea-level rise and property displacement, where the principle provides no guidance on what constitutes 'fair'. He concludes that simple all-encompassing principles are often hard to operationalize and can generate unintended and undesirable outcomes.

45. According to Max Harris, the 'property takings clause' suggests legislation should not impair property without consent of the owner without good justification, fair compensation, and compensation from government or the benefiting party. He notes NZ has not opted for this protection due to the risk of it being weaponized by corporations to prevent regulation in the public interest, such as environmental protection that limits profit.

Issues with the Liberty Principle

46. According to Jonathan Boston, the principle relating to ‘liberties’ in Clause 8(b) is open to serious objections, as it is not a well-established legal principle and its broad references to ‘liberty’ and ‘freedom of choice or action’ are unusual.

47. According to Jonathan Boston, the proposed principle is potentially highly restrictive and would be incompatible with a great deal of existing and likely future legislation, as it only permits limitations to a person’s liberty “as is necessary to provide for, or protect, any such liberty, freedom, or right of another person”.

48. According to Jonathan Boston, this constitutes only the 'private harm principle', ignoring the 'public harm principle' (preventing harm to public institutions like tax evasion laws) and other well-established ‘liberty-limiting principles’ (preventing self-harm, requiring actions for one's own good, protecting critical environmental 'goods', enabling collective goals).

49. According to Jonathan Boston, this principle is fundamentally flawed, seeking to impose highly restrictive limits on government regulatory measures, which would require a massive rewrite of existing laws. He argues no democracy has ever embraced such an approach, nor is one likely to, as its full implementation would likely make it impossible to maintain a stable, properly functioning democracy.

Issues with the Equality Principle

50. According to Jonathan Boston, the Bill's principle that 'every person is equal before the law' is problematic. He explains that many legal rights do not apply to all citizens equally; instead, the law distinguishes and discriminates for good, justifiable reasons.

51. According to Jonathan Boston, ‘equality before the law’ means every law should be applied equally *only to those to whom the relevant law in question applies*, with application differing based on characteristics like age, roles, or group membership.

52. According to Jonathan Boston, slogans like ‘one law for all’ are inherently simplistic, misleading, and can be deeply harmful, as legal equality is compatible with serious breaches of fundamental human rights.

Issues with Taxes, Fees, and Levies

53. According to Jonathan Boston, the proposed principles relating to taxes, fees, and levies in Clause 8(d), (e), and (f) are problematic, especially in determining what is 'reasonable' for levies, benefits, costs, and risks.

54. According to Jonathan Boston, it is difficult to assess the benefits and costs of government interventions or the extent and monetary value of positive and negative externalities. He notes that estimates for the social cost of carbon, for example, vary greatly.

55. According to Jonathan Boston, many current government levies are not designed primarily to benefit those on whom they are imposed, but rather to benefit *other people and/or the environment*. He states that under the proposed wording, such levies (e.g., waste disposal, customs, offender levies) would presumably be deemed unreasonable and unjustified, highlighting the philosophically narrow and ideologically-motivated nature of some proposed principles and their indifference to public interest, distributive justice, and environmental protection.

56. According to Max Harris, the 'Taxes, fees, and levies' provisions aim to make it more difficult to impose fees and levies by setting out a rigorous cost-benefit analysis, which he plainly sees as an attempt to handcuff governments in their attempts to introduce taxation.

Practical Implications, Costs, and Unenforceability

57. According to Jane Kelsey, implementation of the Bill is conservatively projected to cost $18 million annually, but it is unclear how that was calculated, and in practice, it may cost a great deal more. She notes that the same ACT party has secured cuts to public services and support for the most needy in order to “eliminate wasteful spending”.

58. According to Jane Kelsey, if coalition partners support the passage of the Bill, they will be unable to implement core policies and face the embarrassment of either having to repeal an Act they supported or routinely making confessions of non-compliance that make a mockery of the legislative process.

59. According to Jane Kelsey, Minister Seymour’s claim that the Bill “is about transparency, not enforcement” is disingenuous, as the redactions of all legal advice and associated commentary hide the legal and fiscal consequences the Minister has ignored.

60. According to Jane Kelsey, there is clearly some possibility of judicial review when ministers’ decisions breach legislated principles.

61. According to Jane Kelsey, there is potential for investor-state dispute settlement (ISDS) brought by an investor against the government under an international investment agreement. She explains that ISDS lacks the essentials of the “principle of the rule of law” (independence of judges, public scrutiny, precedent, appeals).

62. According to Jane Kelsey, ISDS awards commonly run to hundreds of millions or even billions of dollars, even with minimal sunk investment (e.g., Clive Palmer’s A$420 billion claims against Australia).

63. According to Jane Kelsey, special protections for investors enforced through ISDS include direct and indirect expropriation (regulatory takings) and “fair and equitable treatment,” meaning an expectation that the regulatory regime at the time of investment will not change adversely. She notes an investor could try to bolster an ISDS case by pointing to a breach of the Bill’s “principle” or a failure to apply it as a breach of legitimate expectations.

64. According to Jane Kelsey, successive New Zealand governments, including the current Coalition, have recognized the significant fiscal and legal risks and the uncertainty of ISDS, determining not to include it in future international trade and investment agreements. Adopting a domestic regulatory takings rule would be inconsistent with this rationale and would, in effect, provide key elements of ISDS to foreign and domestic investors.

65. According to Jane Kelsey, the most likely and pervasive effect of the regulatory takings principle is “regulatory chill,” where the prospect of being challenged deters a government from adopting new legislation for sound public policy reasons. The threat of judicial review or an ISDS dispute could have a similar effect.

66. According to Jane Kelsey, the Waitangi Tribunal, in its Wai 2522 report, expressed concern over a systemic form of regulatory chill where officials and ministers internalize risks, resulting in self-censorship, potentially circumscribing the Crown’s ability to legislate for Tiriti interests. An example is former Climate Change minister James Shaw admitting the ban on oil and gas exploration was limited due to ISDS risks.

67. According to Jonathan Boston, if enacted, the RSB will generate much needless analysis and disputation, waste the time and resources of officials and ministers, and produce numerous departmental ‘consistency accountability statements’ and ministerial statements that carefully inform MPs and citizens that most legislation is inconsistent with the ‘principles of responsible regulation’.

68. According to Jonathan Boston, the annual cost of producing ‘consistency accountability statements’ for new Bills is estimated at around $10 million across the public service, with a similar annual amount for reviewing all existing legislation over a 10-year period.

69. According to Jonathan Boston, the Bill gives little attention to the application and enforcement of government regulations, including minimizing and avoiding regulatory ‘capture’, thus failing to address several key reasons for poor regulation.

70. According to Jonathan Boston, the Bill fails to address some of the major causes of regulatory failure in Aotearoa New Zealand, including inadequate public investment in assessing modes of regulation, compliance monitoring and enforcement, building skills in regulatory bodies, foresight activities, risk assessment, and addressing regulatory capture.

71. According to Max Harris, the RSB introduces pre-legislative controls requiring "consistency accountability statements" and ministerial statements to assess all legislation against the Bill's principles, giving these principles greater weight and status than the New Zealand Bill of Rights Act 1990.

72. According to Max Harris, clauses 23-25 of the Bill attempt to limit its far-reaching effects by stating that it does not confer or impose legal rights or obligations (except Part 3) and that non-compliance does not invalidate legislation, but he believes there may be legal disputes about these provisions.

73. According to Max Harris, the Bill's fourth intervention is new statutory powers for the chief executive of the regulatory standards Ministry to require information from other public service agencies, which he believes gives heightened power to the Ministry for Regulation and will obstruct the work of other agencies, consuming considerable time and resources, without a well-substantiated problem for this part.

Duplication, Inadequacy, and Alternatives

74. According to Jane Kelsey, the Bill has been rejected by the Legislative Design and Advisory Committee, and even his own made-to-order Ministry of Regulation did not support it.

75. According to Jonathan Boston, the Bill is unnecessary and will contribute to unnecessary duplication of existing quality assurance processes, such as Regulatory Impact Statements, the Parliamentary Counsel Office, Parliament’s scrutiny role, the Legislation Act 2019, independent advisory bodies (LDAC, Law Commission, Human Rights Commission), and judicial review.

76. According to Jonathan Boston, the government failed to follow several of the Bill's own ‘good lawmaking’ principles (Clause 8(j)), such as demonstrating the proposed Bill is in the 'public interest', evaluating options, and analyzing who benefits or suffers detriment.

77. According to Jonathan Boston, the Ministry for Regulation and Treasury (in 2011) believe there are better, cheaper, and more effective ways to achieve the Bill’s main goals without the risks associated with embracing the proposed principles in primary legislation.

78. According to Jonathan Boston, multiple government departments have significant concerns about the RSB, including constitutional implications, unnecessary duplication, high financial cost, undue complexity, risk of tensions between chief executives and ministers, time/resources for Parliament, unintended consequences, and difficulties in determining benefits vs. costs.

79. According to Jonathan Boston, other options for enhancing regulation quality, such as greater use of Regulatory System Amendment Bills (RSABs) and fuller implementation of the Legislation Act 2019, deserve proper analysis. RSABs, which clarify and update statutory provisions, address duplication, gaps, and inconsistencies, and remove unnecessary costs, have significant potential but were not discussed in the Discussion Document or recent RISs.

80. According to Jonathan Boston, proposed Bills are rarely entirely flawed, and the RSB is no exception, as there is merit in requiring departmental chief executives to engage in proactive stewardship (Clause 15) and in the Ministry of Regulation producing a quadrennial briefing (Clause 16). However, he states there is no need for a Regulatory Standards Act to govern such activities, as they could be achieved through amendments to existing legislation like the Public Service Act.

81. According to Max Harris, the Bill claims to be concerned with improving the quality of regulation, but its architects failed to provide evidence that New Zealand’s regulatory quality is particularly low; indeed, evidence suggests NZ has strong tools for ensuring quality. He questions the good faith of the Bill's purported objectives, noting the same government has disregarded principles the Bill purports to uphold.

82. According to Max Harris, it is not outlandish to conclude that this Bill is not really seeking to uphold standards of regulation but is attempting to make it harder for a government to regulate because its architects consider regulation a threat to individual and corporate liberties and powers. He sees this as a jaundiced view that could greatly damage the public good.

83. According to Max Harris, there are many ways to encourage regulatory standards to be upheld, including an expanded role for the Law Commission or through guidelines and other mechanisms suggested by the Ministry for Regulation. He believes the Bill does not do what it claims and is an attempt to cement a fringe, individualistic ideology that will make governing in the public interest harder.

Constitutional Concerns

84. According to Jonathan Boston, the RSB, like its predecessors, is of unquestionable constitutional significance, described as a "regulatory constitution" or a "second Bill of Rights".

85. According to Jonathan Boston, while not "constitutionally superior law" and consistency assessments not legally binding, it is constitutionally important as it is designed to prevent or deter legislation on grounds of being "unconstitutional" (inconsistent with principles). He quotes Professor Andrew Geddis, who states the RSB will create a "regulatory constitution" that imposes limits within which Parliament may properly legislate.

86. According to Jonathan Boston, legislation would be “unconstitutional” if inconsistent with a specific ideological creed, namely neo-liberalism, market liberalism, or a version of libertarianism. This is evident from principles designed to constrain state regulation, making regulations for environmental goals, wealth redistribution, or paternalistic reasons inconsistent with the RSB. This approach is inconsistent with New Zealand’s legislative history, traditions, and cultural values.

87. According to Jonathan Boston, the RSB differs from earlier versions in not mandating a specific role for the courts. However, Clause 24(1) states the Act does not confer or impose a legal right or obligation enforceable in a court, which he finds a highly unusual arrangement with unclear legal implications. It might mean no *legal* obligation for chief executives to prepare 'consistency accountability statements'.

88. According to Jonathan Boston, the requirement for departmental chief executives to produce 'consistency accountability statements' and to 'act independently' of their Minister could create tensions, as ministers will naturally want their legislation to be consistent with the principles, putting chief executives "between a rock and hard place". He notes that most legislation will be inconsistent with one or more of the RSB principles.

89. According to Max Harris, the Bill has constitutional effects by elevating the status of certain core principles and creating new entities and powers. He argues the process of passing the Bill has lacked what would be expected in constitutional change, with no widespread consultation and no super-majority required to pass it.

Minister's Conduct and Transparency

90. According to Jane Kelsey, her Official Information Act (OIA) requests to the Minister were delayed and drip-fed on grounds that the Ombudsman found were not justified, revealing either woeful ignorance or deliberate obstruction by the Minister and his office.

91. According to Jane Kelsey, the Discussion Document released on 19 November 2024 was so heavily redacted that it undermined the supposed purpose of pre-legislative engagement.

92. According to Jane Kelsey, the Minister’s failure to comply with his obligations under the Official Information Act is clearer evidence of his “do as we say, not as we do” approach regarding transparency.

93. According to Jane Kelsey, the Ombudsman found the Minister improperly relied on Section 18(d) of the OIA to refuse information, concluding that the Minister wrongly refused her requests.

94. According to Jane Kelsey, the Minister’s *ex post* handwritten recollection of his feedback and decisions, released on May 12, 2025, seemed calculated and contemptuous, barely legible, and derisory. She quotes his scribbles: “What is a Māori expert?” and “NOWHERE in this report is it explained how including a Treaty principle would deliver better regulation for NZers”.

95. According to Jane Kelsey, her conclusion from this saga is that the Minister believed he could avoid disclosure under the OIA by avoiding documentation and receiving oral advice, and that his overall approach was not complying with the OIA in good faith.

96. According to Jane Kelsey, the Minister’s and his advisers’ conduct in this saga suggests they are clearly not fit persons to be exercising the proposed powers under the Bill.

Conclusion and Recommendation

97. According to Jane Kelsey, the content and process of this Bill are the antithesis of the evidence-based, responsible, principled approach to regulation that it purports to espouse. It is inequitable, unworkable, unaffordable, and in flagrant and deliberate violation of Te Tiriti o Waitangi.

98. According to Jane Kelsey, the Bill carries major legal and fiscal risks, as well as dire social and environmental consequences, and would fetter attempts to make markets operate according to capitalism’s fundamental principle of competition.

99. According to Jane Kelsey, if this Bill were passed, governments would be forced to actively, deliberately, and routinely disobey the law, making a mockery of the parliamentary process. Alternatively, an incoming government would have to repeal it, wasting more public funds.

100. According to Jonathan Boston, the RSB is fundamentally unsound—constitutionally, legally, philosophically, and ethically—and arguably politically inept. If enacted, it will result in large numbers of ‘consistency accountability statements’ showing the government acting inconsistently with its own enacted 'benchmark', which will be politically embarrassing and make the government look foolish.

101. According to Jonathan Boston, the Bill falls short of complying with many of its own principles, uses open-textured language leading to uncertainty, obscures complexities, lacks problem definition, does not assess workable alternatives, and would be impossible to make all existing legislation compliant without massive additional resources, making it a disproportionate and inappropriate response.

102. According to Ganesh R. Ahirao, the Bill is founded on an irrelevant 17th-century view of a uni-directional social contract restricted to individuals with interests and property. A relevant and widely-acceptable 21st-century social contract would include responsibilities and obligations on those with interests and property and recognize interests and rights of non-individual economic actors.

103. According to Ganesh R. Ahirao, the Bill claims to establish principles for "responsible" regulation, but there is no evidence that the stated set is responsible, as no criteria are presented against which the responsibility can be assessed.

104. According to Ganesh R. Ahirao, in addition to the Waitangi Tribunal's findings of breaches and potential further breaches of Te Tiriti o Waitangi, there is a solemn, compelling, and overwhelming case that this Bill should be discarded in its entirety.

105. According to Max Harris, the Bill should be discarded, and those opposing it should commit to its repeal as soon as they are in government.

I recommend that this Bill not proceed.

Thank you for your time and consideration.

Sincerely,

Nathan Surendran

Schema Consulting