New Zealand’s Finance and Expenditure Committee has recommended the Regulatory Standards Bill proceed to second reading despite receiving 159,000 submissions – 98.7% of which opposed the legislation. The committee reported on 9 October with eight amendments, but the bill’s core structure remains unchanged.

The legislation now awaits second reading debate, likely in late 2025 or early 2026. The coalition government is expected to advance it despite unprecedented opposition from the legal community, the Waitangi Tribunal, unions, environmental groups, Māori organisations, and professional bodies.

What the bill does

The bill establishes statutory principles of “responsible regulation” against which all government-initiated legislation must be assessed. These principles include rule of law, protection of liberties and property rights, cost-benefit analysis requirements, and consultation obligations.

Agencies would be required to prepare Consistency Accountability Statements (CAS) for new bills and specified secondary legislation, published when legislation is introduced. Where inconsistency with principles is identified, the responsible Minister must make a public statement explaining why the government is proceeding.

The bill also creates an independent Regulatory Standards Board to investigate complaints about existing legislation and review whether it aligns with the principles. The Board’s findings would be non-binding but publicly reported, creating transparency and political pressure. Ministers and chief executives would face enhanced obligations to regularly review existing regulatory systems for consistency with the principles.

Select committee amendments

The committee made eight changes to the bill as introduced. The most significant shifted Board member appointments from the Minister for Regulation to the Governor-General (acting on Ministerial recommendation) – a change intended to enhance independence.

The property rights principle was also amended, changing “impairment of property” to “severe impairment” to raise the threshold for when compensation would be expected. The bill’s reference to the Constitution Act 1986 was limited to section 22(a) (equal application of law) rather than the entire section.

Critics argue these changes are cosmetic and fail to address fundamental concerns about the bill’s constitutional implications, Treaty of Waitangi exclusions, and ideological foundations. Labour and Green Party members issued minority views recommending the bill be withdrawn entirely.

The scale of opposition

The 98.7% opposition rate is extraordinary for any piece of legislation. Submitters included organisations described by observers as “highly respected” with “no particular political alignment.”

The New Zealand Law Society told the committee the bill is “fundamentally misconceived” and undermines aspirations for high-quality legislation rather than supporting them. The Society noted the policy process itself failed to meet the bill’s own standards, with inadequate problem definition and rushed consultation over the Christmas-New Year period.

The Waitangi Tribunal found in May that the Crown breached Treaty principles of partnership and active protection by failing to meaningfully consult Māori before Cabinet took significant decisions on the bill. The Tribunal recommended pausing progress for genuine engagement – advice the government did not accept.

The New Zealand Council of Trade Unions opposed the Bill “in the strongest terms,” arguing it embeds libertarian political beliefs prioritising individualism and property rights over collective welfare. The NZCTU warned the “taking of property” principle could require compensation when regulation reduces business profits, forcing government to choose between not regulating or breaching principles.

The Parliamentary Commissioner for the Environment recommended the bill not proceed, noting the principles provide no guidance on managing publicly owned or common resources and could be interpreted to prevent regulation of pollution or environmental harm without compensation.

Treasury and the Ministry for Regulation estimated the CAS regime would cost government agencies between $18 million and $60 million annually, depending on scope and implementation approach, plus ongoing costs for the Board and Ministry oversight. These costs would be managed within existing baselines, likely requiring trade-offs against policy development, enforcement, or education activities.

What supporters say

The 1,191 submissions supporting the bill came primarily from business groups and individual business owners. The New Zealand Initiative backed the legislation as an important step toward improving regulatory quality, though it recommended the Board prioritise legal expertise and that government develop clear guidance on applying principles.

BusinessNZ and the New Zealand Taxpayers’ Union argued the bill would protect property rights, improve regulatory quality, and ensure cost-benefit analysis is conducted for new regulations. Minister for Regulation David Seymour has described it as addressing longstanding concerns about regulatory burden and quality.

What happens next

The bill awaits second reading debate in Parliament. If it passes, it will proceed to Committee of the Whole House for detailed clause-by-clause consideration, where further amendments could be proposed via Supplementary Order Papers. A third reading vote would follow before Royal Assent.

Most provisions would come into force on Royal Assent, but the Board establishment and CAS requirements would commence on a date set by Order in Council, no more than six months after enactment.

Regulatory agencies are beginning to prepare for potential implementation despite ongoing uncertainty about the bill’s fate and final form. The regulatory community faces substantial operational changes if the legislation proceeds – including new documentation requirements, systematic review obligations, and interaction with an independent Board empowered to publicly scrutinise regulatory quality.

Fourth attempt at statutory principles

The Regulatory Standards Bill is the fourth attempt since 2006 to embed statutory principles for “responsible regulation” into New Zealand’s legislative framework. Previous versions – proposed in 2006, 2011, and 2021 – were rejected after parliamentary scrutiny or failed to gain sufficient support for first reading.

The bill sits within New Zealand’s broader regulatory management system, which includes regulatory impact statements, Legislation Design and Advisory Committee guidance, Attorney-General vetting under the New Zealand bill of Rights Act 1990, and stewardship obligations under the Public Service Act 2020. Critics argue it duplicates these existing mechanisms while adding cost and complexity.

Most comparable jurisdictions – including the United Kingdom and Australia – use administrative frameworks rather than statutory principles for regulatory quality oversight. New Zealand’s approach, if enacted, would be internationally distinctive but largely isolated from international practice.