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Hunn Review: Annexes (30 September 2002)

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Annex F (continued)

Legal Analysis of New Zealand Defence Legislation

Assessment of Current Defence Legislation

Political Responsibility Preserved
  1. The current legislation continues to reflect the conventional constitutional position of the armed forces. The Governor-General's ceremonial position is recognised by the Defence Act. Parliament's scrutiny of expenditure in Vote Defence is the same as for other departments (though annual legislation to authorise the maintenance of a standing army is no longer required). The Minister of Defence's political responsibility for defence matters is explicitly recognised by legislation (and indeed stated to extend to "control" through the command of the Chief of Defence Force). In addition the nature of the relationship between the Minister and the military is set out in detail in statute.
Split of Operational Functions from Policy, Purchase and Review
  1. The current legislation reflects the policy intention to split the unified organisation of the Ministry of Defence into two organisations. The new Ministry is responsible for policy, purchase and review functions, with the New Zealand Defence Force acquiring operational responsibilities. The structures and legislative incentives for cooperative behaviour have also been lessened. The Defence Council, which constituted a forum of significant legal powers, and which presumably required some measure of cooperation to function effectively, was abolished.
  2. It is particularly noticeable that the current, predominantly civilian, Ministry that exercises defence policy, purchase and review responsibilities, has few powers to extract information from the operations organisation of the New Zealand Defence Force.
  3. The three possible legal levers are:
    • Section 24(3) of the Defence Act 1990 which defines the Secretary's statutory powers as including "all such other powers as may be reasonably necessary to enable the Secretary to perform the functions and duties imposed on the Secretary by or under this Act or any other enactment." This power is likely to be too broad to enable the Secretary to require the specific provision of information by the NZDF.
    • Section 31(2), and (3) of the Defence Act 1990 empowers the Minister to require the Secretary and CDF to consult formally if the issues relate to advice that is to be, could be, or has been given to the Minister. Yet formal invocation of ministerial authority is a blunt and haphazard instrument to empower the exercise of the core functions of the Ministry.
    • Standing Order 197 empowers the Foreign Affairs, Defence and Trade Select Committee to require information but this is an even more public and blunt instrument that is unlikely to assist the Ministry to perform its core functions on a day to day basis.
  4. It is not clear to us why the Defence Act 1990 fails to provide the Ministry of Defence with an adequate mandate to obtain information from the NZDF when such powers appear to have been envisaged in the 1989 Cabinet Policy Committee decisions leading to the legislative change. Nor is it clear to us why the Minister of Defence in August 1990 would have wished to have exercised his statutory power under section 24(2) of the Act to circumscribe the Ministry's exercise of its audit and assessment powers by preserving the assessment of professional military performance as the responsibility of the CDF. This direction is apparently still in force.
  5. The Ministry's advice on policy and purchase decisions, as well as its ability to review, can only be as good as the information base it has to work from. In situations where operational incentives exist to skew such decisions, NZDF can be expected to have a natural reluctance to disclose information. Such a relationship can be characterised as a bilateral bargaining game, and cannot be expected to work unless both organisations have institutionally equivalent powers and need each other to succeed (and it may not work very well even then). This condition does not appear to be satisfied under the current legislation.
Ministerial Authority and the CDF
  1. Ministerial authority over the armed forces is emphasised in the current legislation. Three sources of authority are particularly important.
  2. First, section 7 of the Defence Act 1990 provides that "[f]or the purposes of the general responsibility of the Minister in relation to the defence of New Zealand, the Minister shall have the power of control of the New Zealand Defence Force, which shall be exercised through the Chief of Defence Force." The extent of the powers conferred upon the Minister by this section to direct the military is unclear at the margins, and untested in court. It is likely to be affected by the historical evolution of the prerogative in relation to defence matters and the scheme of the current defence legislation. We consider that, if tested in court, the Minister's power would be likely to extend to control over general strategic decisions relating to the deployment of troops and politically sensitive decisions relating to foreign policy. It is unlikely to extend to specific operational decisions in a field of conflict which a court is more likely to find to be the preserve of the CDF. There is a legal grey area here and the circumstances which would test it would require an unfortunate conflict to develop between the Minister and CDF.
  3. The second source of ministerial authority in relation to defence matters derives from the Minister's statutory duty under section 25(2) of the Defence Act 1990 to give to the CDF written terms of reference. These must:
    • Be consistent with the provisions of the Defence Act 1990;
    • Set out the terms and conditions of appointment as Chief of Defence Force;
    • Set out the duties and obligations of that appointment; and
    • Set out the manner in which the Government expects those duties and obligations to be carried out.

The CDF has the duty to act in accordance with those terms of reference (section 25(2)).

  1. In our view the terms of reference may be used by the Minister to direct the overall approach that is to be taken by the CDF. For instance, the terms of reference may direct that one obligation of the CDF on appointment is to act in a cooperative manner towards the Secretary of Defence. This may be able to be extended to a requirement to provide information to the Secretary of Defence upon request. The Minister does not have the power to use the terms of reference to remove or limit the exercise of the CDF's powers, functions and duties that are prescribed in statute, although the Minister may provide direction as to the manner in which these are expected to be conducted. For instance, the Minister can not use the terms of reference to specify which civil staff the CDF is to appoint under section 62A, but could possibly direct which characteristics should be given greater weight by the CDF in making this decision. Our views on the terms of reference are stated generally, in order to give some flavour as to the extent of this power. It would, of course, be necessary to obtain specific legal advice from the Crown Law Office on the validity of any particular proposed set of terms of reference.
  2. The third source of ministerial authority in relation to defence matters lies in the Minister's relationship with the Ministry of Defence. The convention of ministerial responsibility and public service loyalty applies to this relationship as the Ministry is a government department under the State Sector Act, staffed by public servants. The standard directive ability of the Minister in relation to public servants applies.
  3. Finally, the minister's practical exercise of powers depends on the Minister knowing what the key issues are and what the key aspects of key decisions are, especially policy and purchase decisions. This requires good advice. The weakness identified above in the Ministry's power to require the provision of information can be expected to similarly affect the effectiveness of the Minister's role in acting on Ministry advice.
CDF Authority and the Separate Services
  1. The separate nature of the organisation and accountability of each Service has diminished in legislation. The separate Service Boards were abolished in 1971. The role of the Chiefs of Staff Committee was put under the control of the CDF in 1990. The definition of the Armed Forces in the 1990 legislation also has a much more collective flavour to it than previously, a point relied on by Justice Heron in striking out the challenge to the abolition of the Skyhawks in 2001.18
  2. The CDF (or his or her delegate) has the power to "issue and promulgate Defence Force Orders" (section 27(1)). These must:
    • be issued in the performance of the functions and exercise of the powers of the CDF;
    • be issued for the purposes of the Defence Act 1990;
    • be consistent with any of the provisions of the Defence Act 1990, the Armed Forces Discipline Act 1971, or any other enactment (section 27(1)).
  3. Defence Force Orders may relate to, but are not limited to the terms and conditions of service of members of the Armed Forces (section 27(5)); conferring benefits on members of the Armed Forces (section 27(5)); and fixing certain terms and conditions of service, such as provision for appointment, rank, procedure for transfer and conditions attaching to the discharge of members of the Armed Forces (section 47).
  4. Defence Force Orders have the status of orders issued by a superior officer. Failure to comply with a Defence Force Order is punishable by imprisonment for up to two years.19 The right to issue orders is reinforced by the prerogative,20 and the oath taken by all members of the Armed Forces to "loyally observe and obey all orders of Her Majesty, her heirs and successors, and of the officers set over [him], until [he] shall be lawfully discharged".21 This oath legally binds the member to serve in that Service until discharged.22
  5. Each Chief of Staff is appointed directly by the Governor-General (on the advice of his or her ministers) from the officers of the particular Service (section 28) and the Governor-General has the power to release, discharge, cancel or vary an officer's commission or appointment and may delegate this power to the CDF (section 32). The actual procedure for dismissal is not set out in the Act. Under common law, however, "all officers of the Crown -military, naval and civil, are dismissable ..at the Crown's pleasure."23 Although section 32 refers to the Governor-General and not the Governor-General in Council, the Governor-General will still exercise this power on Ministerial advice. The Governor-General's power under this section may also be subject to any conditions of service set out by the CDF under section 45(1), and any Defence Force Orders on the subject that have been issued under section 27(1).24 The exercise of this power is also subject to judicial review. 25
  6. Similarly, each Chief of Staff still retains an ability to report directly and separately to the Minister rather than through the CDF. This is an anomalous position when compared to any ordinary Chief Executive and may not be consistent with current international practice. It presumably enables individual Chiefs of Staff to make end runs around the CDF directly to the Minister and weakens the CDF's authority in advising the Minister. On the other hand, it also serves to ensure that the Minister has contestable advice from professional military officers that may otherwise be stifled by military discipline. The seriously coercive power of the military suggests that there are possible dangers in concentrating the power of military command in one professional military position alone, no matter how well chosen and qualified the individual.

Current Legislation as a Limit on Cooperation

  1. The current legislative regime is designed to separate the defence policy, purchase and review functions of the Ministry of Defence from the operational defence functions of the NZDF. The legal basis of the organisational separation of functions is largely constituted by the creation of two separate organisations. Several sections envisage continued cooperation across organisational boundaries (e.g. sections 24(1)(b), (c), and 31). It may be possible for a number of functions to be undertaken cooperatively and "jointly" across organisational boundaries without breaching the Act.
  2. This section outlines the key barriers in the current legislation to increasing cooperation and coordination between the Ministry of Defence and the New Zealand Defence Force. What is possible without legislative
    change?
  3. The Defence Act 1990 focuses predominantly upon the roles and responsibilities of key officials, rather than specifying the organisational structures of the Ministry of Defence and the New Zealand Defence Force. The separate legal existence of the two organisations, with separate powers and functions, is fundamental to the current legislative regime. This will always enable the Secretary of Defence and/or Chief of Defence Force to withdraw at any time from cooperative or joint structures that are superimposed on the two underlying separate legal entities. However, with goodwill from both of the holders of both of these positions, we consider that a fair degree of "jointness" and cooperation can be achieved between the two organisations without legislative change. If it is intended to create a single integrated organisation then legislative change will be necessary. If it is intended to make specific incremental moves towards more jointness and cooperation then, in the short term at least, legislative change may not be required.
  4. Below, we set out the powers held by key officials under the current legislation that can be used to effect structural change and the powers and functions that cannot be altered without legislative change. Again, please note that these provisions are outlined in order to give a general flavour of what may be possible and what may not be. If specific proposals for incremental moves to increase "jointness" are formulated it will be important to test their validity against the law by way of specific legal analysis.
  5. The existing legislation contains the following powers that could be used to increase "jointness" in the operation of the Ministry of Defence and NZDF:
    • The Minister of Defence has the "power of control of the New Zealand Defence Force" as well as general responsibility for Defence (section 7). (See part III.C above).
    • The Minister of Defence must set terms of reference for the CDF (section 25(2)). (See Part III.C above).
    • The Governor-General may make regulations by Order in Council relating to a wider range of purposes (section 101).
    • The Secretary of Defence has" all such other powers as may be reasonably necessary to enable the Secretary to perform the functions and duties imposed on the Secretary by or under this Act or any other enactment" (section 24(3)).
    • The Chief of Defence Force has the power to issue Defence Force Orders (section 27(1)). (See part III.D above).
    • The Chief of Defence Force has the power to establish a joint force comprising members of two or more Services and determine who is to command that joint force. (section 12(1)) Such a joint force can attain a similar status to the other Service forces, as the CDF may command the force directly through the joint force commander, irrespective of whether the commander of the joint force is a Chief of Staff (section 8(2)(b)).26
    • The Chief of Defence Force may divide the Armed Forces into "such branches or corps, formations, commands, units and other parts as the Chief of Defence Force determines from time to time" (section 11(6)).
    • The Chief of Defence Force has the power to determine the "functions, duties and powers" of the Chiefs of Staff Committee, provided only that these are not inconsistent with the Defence Act 1990 (section 29(2)). (See Part III.D above).
    • The ability of the Minister of Defence, the CDF and each of the Chiefs of Staff to delegate their powers under section 30 may be used to facilitate structural change.
  6. Powers and functions conferred by the current legislative regime, which cannot be altered without legislative change, include:

A Concluding Note about Organisational Reform and Legislation

  1. An effective legislative regime for a government organisation requires well thought-through policy and organisational design. This requires careful analysis of exactly what governmental functions are sought to be fulfilled. It requires analysis of how the activities necessary to fulfil those functions are undertaken. It requires analysis of the incentives necessary to entice the relevant actors to undertake the required activities. It also requires that those incentives are accurately provided for and this must often be by way of legislation. It is vital that the policy decisions are accurately captured in the detail of the legislative provisions. There is no point formulating a lovely set of policy decisions on organisational design if the detailed legislative provisions that effect them are not consistent with the policy intent. Inconsistency between policy intent and legislative effect can lead to policy failure.28
  2. Equally though, while legislation may be an essential ingredient to effective organisational reform, you cannot legislate behaviour. Human behaviour is the driving force in all organisational dynamics and must be taken into account, enabled and harnessed in organisational design and their legislative frameworks.
  1. Curtis v Minister of Defence (20 November 2001) High Court Wellington, CP253/01.
  2. Armed Forces Discipline Act 1971, s 39.
  3. In R v Froggatt (1992) 1 NZCMAR 169, 183, the Court Martial Appeal Court also noted that; "the right to give an order derives from the Royal prerogative and not from statute."
  4. Defence Regulations 1990, s 3.
  5. Defence Act 1990, s 35.
  6. Deynzer v Campbell [1950] NZLR 780, 811 (CA) per O'Leary CJ.
  7. The Defence Act 1990, s 32(1) provides that the Governor-General's powers under this section are subject to the provisions of the Defence Act 1990.
  8. Bradley v Attomey-General [1986] 1NZLR 176.
  9. The Chiefs of Staff have a superior position to that of a joint force commander who is not also a Chief of Staff, due to the provisions in section 28(6) enabling the Chiefs to make representations to the Minister of Defence.
  10. The meanings of "civilian" and "military" advice are not set out in the Act. It is not clear at what point of integration the fact that the support body to the Secretary and the CDF are joint would compromise the nature of the advice that each provides to the Minister, making this advice something "more", or "less" than civilian or military advice.
  11. For further guidance as to the relationship between policy development and implementation into legislation see: Legislation Advisory Committee Guidelines on Process and Content of Legislation (Legislation Advisory Committee, Wellington, 2001); Legislation Advisory Committee Report No.4: Departmental Statutes (Legislation Advisory Committee, Wellington, 1989).

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