The regulatory impact statement from MBIE in August was written several weeks before the government’s cabinet expenditure and regulatory review committee agreed on September 17, in principle, to the proposal by Sapere in its Project Hau Nuku final report that state-owned enterprise MetService be absorbed by the much larger Crown research institute Niwa.
"While the decision to acquire MetService once legally permissible is ultimately a decision for Niwa’s board," the impact statement said, "we understand that Niwa is interested in pursuing the acquisition as they have a sound understanding of MetService’s business."
The impact statement ruled out MetService’s preferred option of a new Crown weather forecasting agency and did not discuss MetService’s suggestion it be done in two steps, to protect existing work, streamline changes and minimise the "risks of culture clash".
MBIE said that option would take longer to implement, due to transferring assets and knowledge to a new organisation and finding new management and board members.
On September 26, Science, Innovation and Technology Minister Judith Collins announced the government had agreed "in principle" to Niwa acquiring MetService.
That decision, which still has to go through regulatory and legal hoops before final cabinet sign-off, comes after years of overlap and competition between the two organisations that led to last year’s Project Hau Nuku review.
MBIE’s impact statement said once the acquisition of MetService was legally possible, Niwa would be able to go ahead with its due diligence.
The price of MetService would need to be worked through, depending on the due-diligence outcome and a valuation of MetService’s shares, it said.
The Otago Daily Times asked Niwa, under the Official Information Act, for details of internal Niwa discussions, during the review process and the government’s deliberations, about how it might work with MetService, including any advice from MBIE on the matter.
Niwa is withholding that information for reasons of "free and frank opinion". A complaint has been made to the Ombudsman’s Office.
GNS Science, or parts of it, may also eventually end up being absorbed into Niwa because of its work on other natural hazards.
That option, canvassed in the Sapere review, was supported by the National Emergency Management Agency.
In a May 31 MBIE-Treasury report, released under the OIA, officials recommended the Niwa-MetService matters be resolved first, as the Science System Advisory Group, being chaired by Sir Peter Gluckman, had "the mandate to assess the integration of wider natural hazard and/or emergency management capability within the weather forecasting system".
However, "Niwa may propose further amalgamation after the acquisition of MetService".
- By Paul Gorman
