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The Perspectives of the Ministry of Consumer Affairs'
Stakeholders
Background Paper to Creating Confident
Consumers
May 2003
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4. About the
Stakeholders
4.1 Internal Stakeholders
Ministry of Economic Development (MED)
MED is
MCA's primary
internal stakeholder.
Structure
In terms of processes,
MCA is a branch
of MED.
Chief Executive Officer (CEO),
Geoff Dangerfield, is accountable to the Minister of Consumer
Affairs for the performance of
MCA.
CEO delegates
functions and authority to the General Manager (GM)
MCA.
GM is seen by the
CEO as his delegate
operating with his authority.
CEO decides the
shape and capability of
MED/MCA,
i.e. how they achieve as well as what they achieve.
CEO is responsible
for the values, performance, and ethics of the whole agency. The
staff of MED
and MCA are,
therefore, one staff and loyalty and allegiance are expected to
be to the whole agency. In other words,
MCA is a
component part of
MED in terms of the legal position and in terms of
accountability, but it has a separate branding.
The practical interface between
MCA and all
other branches of
MED is the Senior Leadership Team (SLT).
The GM
MCA and the
Branch Managers (Deputy Secretaries) of
MED are
members of this team, which is led by the
CEO. This forum is
reported by MED
members of SLT to be
an exercise of influence through debate.
Although members of SLT
reported that there was much greater understanding and
commonality of philosophy between
MED and
MCA now than
there was five or so years ago, there was still a feeling that
there was not yet a common philosophy, and there was also a view
expressed that MED
relied on MCA
to have a different perspective.
MED's
Core Outcome
New Zealand's business environment actively promotes and
enables a higher rate of sustainable economic development.
MED/MCA
Between MED
branches and MCA
the interest in developing relationships varies according to
synergies in workloads. Resources and Networks Branch and
Regulatory and Competition Policy, in particular, expressed
considerable interest in maintaining good working relationships
with MCA and in
having shared philosophies.
Relationships with
RCP
and RNB were
built from the experience of working with the
MCA policy
group. They were reported as if they are personal working
relationships rather than structural relationships. They
happened, rather than being deliberately sought outside the need
to work together on a particular project.
Other Internal Stakeholders
There are four stakeholders who are actually groups set up by
MCA for
specific purposes. They are the Māori
Reference Group, the Pacific Island Reference Group, the Consumer
Representative Network, and the Consumer Nominations Group.
Māori Reference Group
Roopu Tohutoro Māori, the
Māori Reference Group, was set up by
MCA to advise
MCA staff on:
- what matters are of interest to, and specifically relate to
Māori consumer needs
- whether it is necessary to go beyond the resources of the
group to seek a wider Māori
representational view
- with whom, in addition to the group members, you should
consult.
The group is to be consulted, when required, in the early
stages of project planning relating to Māori,
as well as throughout the project.
When consulted the group has provided valuable assistance to
staff. The question is - have they been consulted in every
appropriate case? There is no evaluation available.
Pacific Island Reference Group
The Pacific Island Reference Group consists of 10
representatives reflecting a fair balance of gender and age: two
Samoans, two Tongans, two Cook Islanders, two Niueans, one
Fijian, and one other.
The Pacific Island Reference Group was set up within the
Consumer Information Service (CIS)
to:
- assist and advise the Ministry on our Pacific Island (PI)
networking activities and provide ideas and initiatives to
improve our approach given the limited resources we have
- effectively promote the appropriate use of the
CIS services
- help promote the Ministry to the
PI communities and
inform the MCA
of consumer issues affecting the
PI communities
- assist with nominations of
PI people as part of the Consumer Nominations Group.
It is an Auckland group which is co-ordinated by
MCA Pacific
staff in Auckland. The role of
CIS' Pacific
staff in activating this group is significant.
The Pacific Island Reference Group acts in an advisory and
consultative capacity. The group also see themselves as being
able to pass on consumer information to their peoples in their
own language.
Evaluation tools are yet to be developed.
Consumer Representative Network
The Consumer Representative Network is a network of people who
are, have been, or aspire to be laypersons or consumer
representatives on statutory and other boards. The composition of
the group is intentionally weighted heavily towards those who are
currently or have recently served as consumer representatives.
The first national meeting of the Network was held in
Wellington on Saturday 22 June 2002. The next meeting is planned
for February 2003. The objective is to create a network of
representatives who can consult and assist each other, build the
skills and knowledge of representatives, and give
MCA access to a
wider spectrum of consumer opinion and expertise.
Evaluation tools are being developed; however, at this time it
is too early to evaluate effectively.
Consumer Nominations Group
The Consumer Nominations Group was set up in 2002. Its
membership is 12 consumer representatives selected on the basis
of their extensive networks and willingness to assist the
Ministry by identifying candidates for layperson or consumer
positions. This initiative replaces the
MCA database.
The group is already somewhat successful, having provided the
successful candidate for 36% of the positions they made
nominations for.
The composition of the group is reviewed at least annually in
terms of their individual contributions and the group's
contribution as a whole.
4.2 External Stakeholders
Commerce Commission
The Commerce Commission is funded by
MED to
enforce the Fair Trading Act. Because of its limited funding the
Commission selects the issues they investigate on the basis of
agreed criteria such as widespread detriment or the need for a
warning to be issued.
The Commission doesn't seek redress on behalf of individuals.
It acts to penalise the culprit firm and stop the behaviour.
Individuals have to seek redress through the usual channels
(disputes tribunal, courts).
Ministry of Justice
The Public Law Group of the Ministry of Justice works with
MCA policy unit
on a range of matters including occupational regulation and
commercial and property matters. The Ministry of Justice also
currently enforces the Credit Contracts Act. The new Act will be
enforced by MCA.
Banking Ombudsman Commission
This is a well-established self-regulating body for banking.
The fundamental characteristic of the Banking Ombudsman is the
impartiality of the office. Banking Ombudsman Liz Brown is quite
clear that she cannot and should not act as a consumer advocate.
Ninety percent of the Ombudsman's role is in providing a
dispute resolution service. The Ombudsman is also required to
monitor the Code of Banking Practice.
MCA is
involved in the regular reviews of the Banking Ombudsman
Commission Code and in advising the Minister on the consumer
appointments to the Commission.
Electricity Complaints Commission
The Commission was established in 2001 and is still
developing. The Commission is developing the Code of Practice at
the moment. There are issues about membership of the scheme but
the Commissioner believes these to be primarily about the cost
rather than principle, a matter which may be resolved by the
Code.
The Commissioner is also heartened by the company support of
the scheme. They are taking the Commission seriously and are very
interested in the comparative statistics of complaints (and she
reports that companies have even brought in complaints which are
outside the Code).
MCA had a
significant involvement in the establishment of the Commission,
working with MED.
It will continue to be involved at this level and in advising on
appointments to the Commission.
Māori Women's
Welfare League (MWWL)
The MWWL is
a premier organisation recognised by Māori
and Pākehā for its influence amongst
Māori and within government. The League
talks about itself as providing a place where
Māori women will get information. The League is a national
organisation with well-established regional structures and strong
networks.
Māori are a target group for
MCA.
MCA, through
the CIS, has a
contract with the League. The League is working with
CIS to make
consumer information available to Māori
women. The expectation is that this will be a long-term and
growing relationship.
Consumers Institute
The Consumers Institute began as a product testing
organisation-now 50% of their testing is of services. The
Institute publishes a monthly magazine which is purchased by
subscription, and is also active in the media. The Institute is
willing and able to comment with common sense and force on
consumer issues. In particular, the Institute is concerned about
the ever-increasing disparity in knowledge between consumers and
traders/service providers.
The Consumers Institute's constituency is the readers of its
magazine who are primarily Pākehā and
middle-class, in other words a substantial group of New
Zealanders. The Institute also attempts to think beyond the
boundaries of its constituency.
The Consumers Institute is an effective and accepted lobbyist
on consumer matters. It enters debates often on the basis of
research or knowledge and realistically weighs up the respective
roles and expectations of consumers and traders/service
providers. For these reasons it is respected by Ministers and by
a significant proportion of the New Zealand community.
Nevertheless, funding is as much a problem for the Consumers
Institute as it is for community groups.
New Zealand Citizen's Advice Bureaux
(CABX)
The CABX is a
nationally co-ordinated organisation of local
CABs.
CIS has a
contract with CABs
to provide a telephone advice service on consumer matters.
MCA provides
funding and manuals to local
CABs, and, in
addition, provides training annually for local volunteers.
CABX has 80,000
contacts with consumers and sees itself as the primary frontline
contact on consumer issues. Both Consumers Institute and
MCA refer to
CABX. However,
CABX believes that
this role is not acknowledged by
MCA in terms of
the funding/resourcing provided.
MCA provides
$7,000 per annum plus information manuals and updates, and
training. CABX
claims the actual cost of providing the service for
MCA is $440,000
per annum (@ $5.50 per enquiry: total costs of
CAB ÷ total number
of enquiries).
CABX wants more
funding, and ongoing, regular contact with
MCA, not just
consultation on issues-perhaps regular meetings with the General
Manager or with the
CIS Manager. They intend to use the process of reviewing
the Memorandum of Understanding as a way of developing influence
and also of seeing how things work in
MCA.
New Zealand Federation of Family
Budgeting Services (NZFFBS)
The
NZFFBS is the nationally coordinated body of local Budget
Advice Service branches.
CIS provides
the branches with funding, training, and a manual.
The national body is not funded by
CIS. Although
there is no direct funding of the national body,
MCA does
benefit from the presence of a national structure. For example,
NZFFBS Chief Executive Raewyn Nielsen points out that if
there was no national structure, there would be no economies of
scale, and there would be less professionalism in the service
because it is the national structure which builds this.
NZFFBS has also identified a developing problem for itself
and potentially for
MCA. It reports that there is a drastic shortage of
volunteers for budgeting work.
NZFFBS has lost 200 volunteers each year for the last five
years but has only recruited about 160 each year. This is already
beginning to impact on its ability to provide the service.
NZFFBS has plans to establish three regional paid
positions to recruit volunteers and provide direct support for
volunteers to meet this looming crisis but needs to locate
funding first.
New Zealand Retailers Association (RTA)
The RTA
represents retail businesses in New Zealand. The membership
includes 130 of the 160 national chains of stores and 4,000
independent retailers.
Only 40-45% of
RTA's funding comes from subscriptions. The rest comes
from corporate sponsorship and other special arrangements with
corporates. Events must all be self-funding.
RTA is
hosting a major international conference in New Zealand in 2003.
New Zealand Bankers Association
The Bankers Association has adopted an attitude of enlightened
self-interest and is looking for positive, constructive
discussions with government and opportunities to make a useful
contribution. It recognises that there are other parties who also
have vital interests and is prepared to take that into account in
any discussions. The Bankers Association advise that they have
moved a long way in recent discussions about the Code of Banking
Practice.
More and more of the Association's work is in developing
effective technical standards in banking rather than commenting
on broad industry issues.
Sensortronic Scale Ltd
Sensortronic is a small/medium business set up to supply and
repair weighing equipment. Their contact and interest with
MCA is as a
private sector verifier of weighing equipment authorised under
the legislation.
4.3 Stakeholders in Terms of
Power/Interest Matrix
The power/interest matrix basically divides stakeholders into
four categories: those who are key players; those who we keep
satisfied; those who we keep informed; and those with whom we
make a minimal effort. The matrix is attached as
Appendix D.
It is clear from the transcripts recorded as
MCA managers
and stakeholders identified positions that:
- Each person had their own criteria for deciding where a
stakeholder belongs. There was no known or shared approach
between MCA
managers or between
MCA and stakeholders. This lack of congruence probably
signals that there is not a formal structured or strategic
approach to stakeholder relationships within the Ministry.
- There does not appear to be a consistent or strategic
approach across the Ministry in terms of which stakeholders
meet with GM and which
meet managers or other staff. This means that all relationships
fundamentally tend to lean to the personal rather than the
institutional.
- SLT sees
MCA's
contribution to the overall
MED
outcome in the following terms:
A market-based economy relies on trust to
function effectively. If it does there are wealth and welfare
gains for New Zealand. That is why it is appropriate to have
someone looking at those transactions from a consumer view but
also business to business. Ultimately consumers are critical to
that.
(Lewis Holden)
Economic development is just a proxy for
well-being, which is about consumers, not producers. Economic
development is about improving the well-being of consumers.
(Roger Proctor)
The role of regulation is extending in terms
of reach, which is going to bring us more directly into dealing
with consumers.
(Mark Steel)
- MCA
controls all its relationships with stakeholders except the
Minister of Consumer Affairs and
CEO. The comment
was often made by stakeholders that
MCA tended to
deal with them on an issues basis rather than a relationship
basis. And several managers commented that stakeholders could
have more influence and they were surprised that they didn't
try to have more influence
- MCA
decides its work programme without reference to their
stakeholders.
From the completed matrices it is evident that:
- The majority of
MCA's stakeholders are trader/service provider groups.
There are only four consumer groups consistently mentioned.
They are MWWL,
NZFFBS, Consumers Institute, and
CABX.
- There is agreement that the most influential stakeholders
are the Minister of Consumer Affairs and Chief Executive
Officer MED.
- There is little agreement between
MCA managers,
and between managers and stakeholders, about where
organisations sit on the matrix. The greatest disagreement is
around the extent of the influence stakeholders have.
- There are stakeholders who participate across the Ministry
and then there are those who specialise only in one area.
- Relationships between
MCA and
MED are
relatively underdeveloped. This is a consequence of history and
everyone being very busy rather than any ill-will.
- Although Māori and Pacific peoples
are targeted in MCA
policies, the relationships between
MCA and
Ministry of Pacific Island Affairs (MPIA)
and especially Te Puni Kōkiri (TPK)
are not developed. There was evidence of considerable effort
having been exerted in terms of
TPK but to little or no account.
MCA does have
a working agreement with
MPIA
and there is considerable goodwill there.
- MCA has
not apparently fostered ongoing relationships with any other
departments, even those they may have affinity with. There may
be strategic value in deliberately setting up such
relationships to extend
MCA's
influence and sources of information. In the workplace,
personal friendships between
MCA staff and
staff members from other departments often yield vital
information.
- Given the expected role of global markets in the near
future, there may be value in building a range of international
relationships. At the moment, outside Trading Standards,
international relationships are generally narrow.
4.4 General State of Relationships
The overriding conclusion from the research must be that
MCA has, in
general, developed sound and friendly working relationships with
their various stakeholders. It has a good base on which it can
build if it wishes to.
External stakeholders all feel that relationships with
MCA are honest
and that MCA
listens to them respectfully, but they are not always sure that
their advice has the desired result. They also reported that they
are not involved in the setting of agendas in
MCA. Rather
MCA determines
the agenda and invites them to comment on it.
In terms of relationships of a contractual nature where
MCA purchases
services (e.g. CABX,
MWWL,
NZFFBS), all raised the need for adequate funding levels,
longer term funding to enable them to maintain capacity, and the
role of volunteerism.
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