Check out this substantial communication sent from the Office of the Auditor General to the Commerce Commission.
Auditor General Submission Draft ID Determination 13 March 2012
It gives the ComCom a big slap for the way they are attacking the electricity lines companies.
By way of background, the Office of the Auditor General is the most respected, and indeed the highest independent authority in NZ. We remember well the actions of Kevin Brady investigating Labour’s dishonest actions in the 2005 elections as a high water mark for the NZ Civil Service.
So this criticism from the Office of the Auditor-General is a substantial criticism of the Commission’s Mad Dog attacks, noting their misunderstanding of their role, engaging in “duty creep”, and in need of restraint.
To quote from the letter about the Commission’s overall approach:
“At this point, we have some difficulty in understanding the expectations of the Commission because of what appears to be contradictory statements in the 2012 Draft Determination and the accompanying Draft Reasons Paper.”
The OAG accuses the ComCom of imposing unreasonable costs on Electricity distributors, that may not even make sense. See here on page 2 of the letter
“Viewed one way, these expectations could result in a much more exacting audit, with consequent cost implications. Viewed another way, such an audit may be scoped at such a high level that may not meet the Commission’s expectations.”
Check out what the OAG says about the Commerce Commission’s attempts to define extra power for itself on page 3.
“We also question if the Commissioner has the statutory authority to require auditors to state if they have a duty of care to the Commissioner in the audit report.”
The ComCom is due for a mucking out at the top, we’ve pointed out a Commissioner who needed ten months of timeout to recover from self-inflicted alcohol abuse. (Which other government roles do people get 10 months of golf and book reading to recover from their addictions?)
But clearly there is a need for political intervention to ensure the culture of the Commerce Commission is also changed.
We need an authority that promotes competition and ends anti-competitive behaviour, such as price fixing by petrol companies or supermarkets.
We need an authority that stops the shady practices by financial corporates that hurt consumers, like Credit Agricole and the failed Credit Sails financial product.
We don’t need a Commerce Commission that uses anti-commercial approaches to impose extra costs on businesses for no good reason at all.
We don’t need a Commission that is confused and contradictory in its approach to New Zealand infrastructure and public policy.
We don’t need a Commission that is power hungry and seeking to expand its role.
The Office of the Auditor General is now ringing the alarm bells – and for good reason. This should be the signal that National needs to reform the Commission and bring them back into line.