The new requirement that public sector bosses write assessments of the country’s long-term risks and opportunities is in itself a golden opportunity, write Roger Dennis, Wendy McGuinness and David Skilling.
The Public Service Act 2020 is a new piece of legislation over one hundred pages long. Tucked in near the end is a section that is important for the future of New Zealand. On page 84 is a requirement that every departmental chief executive publish a long-term insights briefing independent of Ministers every three years.
According to the Act, the briefing should cover risks and opportunities that may affect Aotearoa in the medium and long term.
For example, what if the chief executive of Inland Revenue considers there is a major risk of cyber-security to the country’s tax system? Or the Director-General of the Department of Conservation believes there is a significant opportunity to connect green corridors between national parks? The public can and should expect these risks and opportunities to be made public.
The Department of the Prime Minister and Cabinet has written guidance that the briefing should be ready to be presented to the House of Representatives as a Parliamentary paper on or before 30 June 2022.
This is an important initiative. New Zealand policy is famously short-term in nature, as evidenced by our three-year election cycle and the lack of foresight embedded in public policy.
There is often a sense in Aotearoa New Zealand that the future is a series of black swan events that we cannot control as opposed to a landscape that gradually emerges out of the mist; enabling us to shine a light.
Our last attempt at governing with foresight was in 1976 with the establishment of the Commission for the Future. The Commission was established under Muldoon and disbanded in 1982 under Bolger, with the funding used to establish the Crown Research Institutes. Importantly, the Institutes were expected to fill the foresight gap.
In December 2010, Margaret Hunn, former Secretariat co-Director, Commission for the Future, emphasised the conundrum a country faces – a privately funded organisation may be ignored by government if its findings are unpopular while a government-funded organisation is at risk of being disbanded when the possibilities described do not match government thinking.
Hunn concluded that the power of public opinion could be the most valuable tool to ensure the results of futures research do not disappear.
What makes these new briefings a game-changer is they are not just for ministers, but for all MPs. This requirement means other political parties, who do not normally have access to analysis by government officials, will be able to rely on the insights of chief executives to inform their policies and manifestos.
A chief executive not only has a duty of care to understand what matters most to New Zealanders (for example, in terms of social or environmental values) but an obligation to share any relevant, useful and possibly surprising observations on topics they believe should be brought to the surface rather than remain hidden in the shadows.
The briefings should not only boost transparency and accountability (and therefore improve the overall quality of debate in the House), they should also deliver more durable public policy over the medium- to long-term. Political parties will rely on the same data and information at the same time – providing policy-makers with a shared and reliable information platform.
The briefings also require chief executives to act in the public interest and share their insights in the public domain. As part of the process, chief executives must consult with the public on both the topics the draft briefing should cover and the proposed content of the briefing. Importantly, they must also take into account any feedback received before finalising the briefing and giving it to the appropriate Minister to present in the House.
This means a chief executive not only has a duty of care to understand what matters most to New Zealanders (for example, in terms of social or environmental values) but an obligation to share any relevant, useful and possibly surprising observations on topics they believe should be brought to the surface rather than remain hidden in the shadows.
A coherent view of the future is especially important at the moment because the world is undergoing disruptive change across multiple domains. There are significant opportunities for New Zealand over the next decade and beyond, as well as substantial challenges. This level of change means that policy – and the way that it is developed, will also need to change.
Furthermore, in other countries there is a surrounding ecosystem of think-tanks, universities, and large companies developing long-term views on a range of subjects.
This is not the case in Aotearoa; government has to invest more in this space.
The challenges of writing a briefing
Writing a long term briefing that adequately meets the requirements of the legislation is a specialised task. Given the time constraints on this process, some chief executives may be tempted to delegate the process to junior staff in order to meet the deadline.
This is a mistake analogous to preparing for a live television interview by relying on a two-sentence briefing from an intern.
A good briefing needs to acknowledge global levels of volatility and account for the interaction of unpredictable complex systems. More importantly, it needs to challenge a systemic failure of imagination in the development of good foresight.
The pandemic is the most recent example of this, where despite many warnings and weak signals, governments around the world were unprepared for the pace of spread and the second and third level impacts on supply-chains.
How does the private sector do this work?
In the 2019/20 financial year, the total Crown revenue was just over $116 billion. In terms of total employees, the number of public servants working in 36 core government agencies in June 2020 was nearly 60,000.
If you view the entire government as a single organisation, this places it in the same category as a large multi-national corporation. To illustrate this point, while Royal Dutch Shell had more than twice that revenue last year, it has fewer than 100,000 employees globally.
Shell is a useful comparison because it is also one of the best developers and consumers of long term thinking, and has been leading this area for decades. So how does it develop long term insights?
The Shell scenarios team is multidisciplinary and includes more than 30 experts in a range of fields including economics, politics, society and energy.
The head of the programme has been in the role for many years, and along with a global team, travels widely in order to broaden his understanding of a fast-changing world.
This team produces scenarios that take months to create, and then uses these to start strategy conversations with leaders throughout Shell.
How do other governments do this work?
The Singapore government provides an excellent example of how to think about the long term. It established the Centre for Strategic Futures in 2009 and this unit became a part of the Prime Minister’s office six years later.
The Centre has a small team that is led by the former head of the civil service. It has worked extensively with other agencies to embed future thinking teams in many departments.
Good judgement cannot be applied without leveraging real-world experience, and the research phase of the work needs to involve credible experts and international viewpoints. Many of the issues that will impact Aotearoa will originate offshore.
The Centre has many responsibilities, including the internationally respected bi-annual Foresight Week conference that attracts the world’s best foresight experts.
As a result, long term thinking is now common among senior leaders in the Singapore government. Ministers and Permanent Secretaries are regularly briefed on long term risks and opportunities for Singapore.
How should the government do this work?
In our experience, the methodology for developing a LTIB is well understood internationally. At the very least, the process needs to:
- Define what characteristics would make a long-term insights briefing successful.
- Develop a methodology that could be applied by each chief executive consistently across all government departments.
- Scan widely for insight. This means not regurgitating widely held beliefs about the current environment.
- Ensure that early feedback loops are embedded into the insight ecosystem so that the briefings are dynamic and improve over time. This means long term insights briefings should shape investment in research and influence the department’s work agenda going forward.
Furthermore, the focus of the insights matter. In a complex and fast changing world, there are a wide range of issues that could be considered. The development of a long-term insights briefing needs a mix of structure and good judgement to figure out what matters most.
Good judgement cannot be applied without leveraging real-world experience, and the research phase of the work needs to involve credible experts and international viewpoints.
Given the level of uncertainty, we believe it is important for Aotearoa New Zealand that the first set of insights briefings are done very well.
Many of the issues that will impact Aotearoa will originate offshore and are already being explored and engaged with by other foresight organisations. The drivers of change are fairly well known. To complete the first round of long-term insights briefings, the government should actively learn from international experiences rather than starting from scratch.
There is often a sense in Aotearoa New Zealand that the future is a series of black swan events that we cannot control as opposed to a landscape that gradually emerges out of the mist; enabling us to shine a light, build a platform, experiment (and fail fast) or engage early with emerging issues before private sector or party interests become entrenched.
Given the level of uncertainty, we believe it is important for Aotearoa New Zealand that the first set of insights briefings are done very well. If this is achieved, the briefings can serve as a model for future exercises and demonstrate that they can not only strengthen the existing policy process but deliver durable and innovative public policies for generations to come.
Roger Dennis has worked more than two decades with organisations around the world to help leaders make sense of a fast changing world. He is a Senior Fellow at the Atlantic Council in Washington and an Edmund Hillary Fellow.
Wendy McGuinness is the founder and chief executive of the McGuinness Institute Te Hononga Waka. The Institute is a non-partisan think tank working towards a sustainable future for Aotearoa New Zealand using the tools of hindsight, insight and foresight.
Dr David Skilling is the founding Director of Landfall Strategy Group, an economic and policy advisory firm based in the Netherlands and Singapore. David advises governments, companies, and financial institutions in Asia, the Middle East, and Europe on the impact of global macro, globalisation, and geopolitics, from a small advanced economy perspective.
