The key government relationships for Crown boards

Published 13 October, 2010 by Editor

Introduction

As a general principle, boards are the ‘stewards’ for the key stakeholders, the relevant Minister(s). Ministers, as key stakeholders, are accountable to the public interest and that interest has a particular dimension in respect to accountability and responsibility to Parliament. The Ministry acts as the agent of the Minister. (The key internal relationships for boards are discussed under Governance /management interface.)

The Ministers

The relationship between a board and the responsible Minister is usually through the Chair of the entity who may fully or partly delegate this role as appropriate. Board members need to be conscious of the Chair’s ‘link’ role.

For most cultural sector Crown-connected boards, the Memorandum of Understanding between the Board and the Minister helps set out the particulars of how the Board/ Minister relationship operates in practice for your entity. (This is detailed further in the Topic ‘Statements of Intent, Memoranda of Understanding, Annual Reports and Annual Financial Statements’.)

For Crown Entities, the Minister’s roles and responsibilities are detailed in the Crown Entities Act and include:

  • Ensuring that an effective board is in place to govern the Crown entity through the appointment, reappointment and removal of board members;
  • Participating (through the appropriate mechanisms) in setting the direction of the entity;
  • Monitoring and reviewing the Crown entity’s performance and results;
  • Managing risks on behalf of the Crown.

As the ‘responsible’ Minister, the Minister is responsible to Parliament for the entity and this includes relevant oral and written parliamentary questions (PQs).

The Ministry

As the agent of the Minister, the Ministry for Culture and Heritage (MCH) will work with your entity as detailed in the State Services Commission Guidance to Departments in relation to Crown Entities (see web link in appendix): Roles include

  • ensuring that the entity has identified the intended results for New Zealanders;
  • monitoring performance against expected results and outputs;
  • promoting coordination of Crown entities within the Minister’s portfolio;
  • advising the Minister on the entity’s capability to achieve the desired results;
  • advising the Minister on the merits of Crown entity budget initiatives;
  • ensuring that there are appropriate board member appointments, inductions, governance support, Crown entities strategic direction/planning processes and relevant documentation.

Other relationships

All entities are subject to an annual audit carried out (for Crown entities) under the auspices of the Auditor General. Crown entities and other Crown-funded agencies may also be subject to a Parliamentary select committee review. Crown entities will also deal with SSC particularly in respect to Chief Executive appointments and reviews and remuneration.

The Key Government Relationships for Crown Boards - Appendix

Web links

  • 2006 State Service Commission Guide has an overview of Crown entity roles and relationships:
    http://tinyurl.com/38sygy
  • A Treasury view in its 2005 Briefing to the Incoming Government (which outlines the perspective of a Central Agency) is at: Treasury document