Key conclusions​

1. There is no single blueprint for good reform today. While we like to stay positive, there is a lot that can go wrong. Reforms are often born in a sense of urgency, which does not always set the scene for looking back to look forward, and turning our minds to what good reform will require. Failures – of vision, of legislation, of engagement, of execution – are left to individual reforms to own without the mechanisms in place to learn from common missteps along the way. ​

2. Reform is more reactive than responsive. By its nature, reform is defined by system failure, and often long periods of underinvestment. The energy and risk, including political risk, associated with reform kicks the decision down the road. While this pattern may never go away, there are costs and impacts to waiting too long.​

3. Take a Treaty-based partnership approach. Having a more integrated approach alongside Māori and iwi can have lasting positive effects for change, especially where the problem is around issues of equity and poor performance or outcomes. Not having this relationship can, and sometimes does, derail the programme of reform entirely. ​

4. We need a people-centred toolkit. Keeping people at the heart of change (and outcomes) means a more nuanced and expansive understanding of how people change and create change. That means engaging people to drive the demand for change, but also shifting the public discourse about what and who our systems are for will, in the long run, create greater shifts and hold us to account.​​

5. We need depth in capability, but also breadth. Responsibility often falls to the public sector, and they need the leadership stripes and expertise to think strategically, grapple with complexity, engage authentically and deliver at pace. We also need to invest more widely to bring the skills and values of iwi, businesses and communities to successful reform.​

6. Future reforms will need to be more networked, collaborative and distributed. The dominant model is still politically-sponsored and public sector-led. But Government and the public service are not always best positioned to pull the right levers, or do not always have the capability that is needed. Business and community partners also play a key role in co-creating new narratives and shifting mindsets through public discussion and influence. ​

Deloitte Partner, Adithi Pandit, on our findings and recommendations.

Key recommendations ​

1. Create a Reform Office to drive accountability and learning​

Reform is a resource intensive investment, with considerable risk and opportunity to New Zealanders. It is also often driven in verticals – focusing on an industry, a sector, an institution. Compared with other major investments, from public sector transformations to our infrastructure pipeline, there is little review and testing of reforms to provide confidence in the reform investments and choices. There is also little means to hold reforms accountable for what they achieve.​​

A Reform Office should operate throughout the key stages of the lifecycle we describe in our framework to drive accountability and create and disseminate learning. It should test, assess the strength of, and provide confidence against:​

• The case for change – the vision and drivers of reform;​
• How well the proposed reform programme delivers to those drivers;​
• The quality of its delivery plan and mechanisms; and​
• The outcomes and value that it delivers.​

The Reform Office will be able to influence the end-to-end integrity of individual reforms. It will also create increased visibility outside the political sphere of the coherence of reform that will be incredibly valuable during periods of significant reform. A Reform Office looking across reforms will enable us to better signal, align and manage pipelines of reforms, enable strategic workforce planning and disseminate lessons learned in real time. ​

There are existing models that the Reform Office may look to (for example, the Parliamentary Budget Office or the Infrastructure Commission). Critical to its success will be a core enduring workforce with deep knowledge of reform, combined with mechanisms to augment review teams with representatives from across business, iwi, Māori and community groups holding the experience and skills necessary to deeply understand, challenge and critically assess reform choices.​

2. Develop co-innovation and co-governance partnerships​

Government and the public service are not always best positioned to pull the right levers, do not always have the skills and experience needed. Reform partners and stakeholders also play a key role in co-creating new narratives and shifting mindsets through public discussion and influence.​

We need to invest in strategic policy capability inside and outside of government. Harness co-innovation between the public, private and community through mechanisms that bring strategic long-term thinking together outside of the political sphere. Think tanks play an important role here in amplifying the voices of minorities and engaging with stakeholders in ways that the public sector cannot. They also play in a bigger gap between what is possible and what is politically appealing. ​

We also need to transition from engagement to co-governance with iwi and Māori. Embedding genuine decision-making roles and mechanisms that honour Te Tiriti is an enduring call, but perhaps never more so given the nature of the reforms ahead of us and their far-reaching focus on wellbeing of people and land. A recent Deloitte Canada report described a “profound link between Canada’s journey on the path of reconciliation between Indigenous and non-Indigenous peoples and our success in tackling climate change."13 Co-governance means outcomes that are meaningful to all, shared decision-making and a mature and flexible approach to risk. The role set out for iwi and Māori in the new Three Waters system has been both bold and criticised and shines a light on what is possible and how hard the road will be.​

3. Invest in a flexible reform capability ​

Despite, or perhaps due to, the scale of reform underway today, our strategic policy capability is too thin. If reform — and its mosaic of technical capabilities such as strategic policy, implementation, behavioural change – is going to be an ongoing core competency for Aotearoa, we need to invest in this. ​

Beyond existing mechanisms such as the Australia and New Zealand School of Government (ANZSOG) programmes and jurisdictional secondments, Aotearoa should establish a surge capability and mechanism enabling skilled professionals to move flexibly and efficiently between reforms. We can learn from established models overseas, such as Canada’s Free Agent model which employs public servants and deploys them into Federal departments to deliver projects and programmes matching their skillsets. A coordinated approach to adapting resource across reforms will bring the agility of a contractor workforce with the depth and specialism needed, and improves the resilience of our reform programmes by making better use of our capacity. ​

Secondment models between participants in the system – not just public sector departments but business, iwi and community participants – should be encouraged, formalised and invested in. This investment should take the form both of the resource and ability to backfill, and to provide the capacity and mandate for secondees to actively share learnings with both organisations and beyond. Failing to do so will look like flexible capability only to the “winning organisations”, without the strategic investment into the reform (and future state) workforce and to the detriment of smaller, lesser-resourced organisations who are left without the skills and continuity they need to run.​

4. Change the lens to move beyond “engagement”​

There is distance to travel in doing engagement well. Authentic engagement takes time; participants voice a strong desire to stay involved but only want to tell their story once.​

Translating this into more networked and distributed models of delivering reform will take investment outside of the traditional home of the public sector. This includes:​

• Re-anchoring engagement to participants, not reform agendas. Shifting to focus on what is important to system participants, and feeding that to multiple reforms rather than a reform-driven engagement plan. The true cost of quality engagement is already significant, but is hidden in hours that are not paid for and therefore not accounted for. It is also hidden in the cost of quality, when valuable kōrero is missed and key stakeholders engaged too little, too late, or with a constrained focus that does not reflect their true value. 
• Fully costing engagement and consultation, including recognising the value of the time that others are giving to the reform. This is beyond koha, and should include recompensing stakeholders for their inputs and funding and backfilling roles where the skills of partners are heavily leaned on. This is particularly true for iwi, Māori and regional groups who are facing many asks of their time and input.

In conclusion, the pattern of reform repeats: performance deteriorates beyond a point of no return and transformative change is needed again. These leaps take great energy and create winners and losers. The benefits of reform are not easily retained; history shows us many cycles of reform as in time, the new system is reformed again.
Therefore, to enable safe, sustained and just transition to systems of the future, we recommend four actions to smooth out this pattern:

1. Decommission justly. Reform must focus on ramping down the old system as well as creating a new one. The two may run in parallel for a while, so this is essential to managing performance. Importantly, though, it is also effective change management to retire old ways of working and monitor the tendency of systems to slip back.​

2. Create cultural competence. Reform in New Zealand needs a backbone of cultural integrity and that comes from ensuring there is cultural competence to the work being undertaken. The level of competence must be self-determined, by and for Māori.  ​

3. Build the leadership and workforce of the future. Key to the sustainability of reform is looking beyond delivery, to building the skills and competencies people will need in the reformed system. This is true of business, of public service and of the community sector. Joint strategic workforce planning and investment should be a core pillar of reform delivery.​

4. Introduce statutory review periods. To ensure systems are delivering the outcomes that are promised, and to hold the social (and real) licences to operate, the introduction of statutory review periods creates explicit and conscious accountability for how well a stable system is operating outside of a reform process. Creating a regular review cadence will surface issues early; uncoupled from the political cycle it may also surface a broader range of opportunities that would not be generated through purely politically-driven and sponsored leadership. There may be reasonable concerns about increased uncertainty – but against the risk and cost of systems failure, and the need for further expensive reform – we suggest this is a fair trade-off.

Big change is here. To move mountains will require seismic change. As the land shifts, we need to bring people along on the journey and recognise old systems will need to coexist, while new ones are built. ​

While reform causes big disruption, it also creates opportunities to shape a better future for all.