Dr Eric Crampton: RBNZ’s campaign to boost banking cash services struggles under scrutiny

Government is awash in consultation processes. So much so that “consultation fatigue” is a real term.

But it is a bit odd when an agency consults over a proposal that it may not have the legal authority to implement – when it cannot do the thing that it proposes doing, or at least not without legislative or regulatory changes beyond the agency’s own authority.

Roger Partridge: Why boundaries matter in government

The Reserve Bank keeps inflation in check, oversees the financial system, regulates banks and issues the country’s currency. These are important jobs, defined by Parliament. Nowhere among them does it say: decide where banks must put their ATMs.

But that is what the Bank is now attempting. It wants banks to establish more than 1,200 cash service sites across the country, at an estimated annual cost of $104 million. An 84-page consultation document details coverage maps and cost projections. What it conspicuously lacks is a legal basis for any of it.