Two experienced members of the Reserve Bank's (RBNZ) senior management team are leaving the central bank following a restructure.
The RBNZ has announced Head of Supervision Andy Wood will go before Christmas, and Head of Financial System Policy and Analysis Toby Fiennes will leave in March.
Their departures will coincide with a string of other high-profile resignations.
The RBNZ said Wood and Fiennes chose not to pursue roles created in a restructure.
"Te Pūtea Matua is adjusting the structure of its Executive Leadership Team and a second phase of consultation to realign the functions reporting through to Executive Leadership Team members has been completed," the RBNZ said.
"While new roles have been created to support the new leadership structure, Head of Supervision Andy Wood and Head of Financial System Policy and Analysis Toby Fiennes have chosen not to pursue roles in the new structure."
The RBNZ in October announced Chief Financial Officer Mike Wolyncewicz won’t take up a role in the new structure either, and will leave in May, after 21 years at the Bank.
Wood has been at the RBNZ since 2008, and Fiennes since 2005. Both currently sit at the management level, not the leadership level.
Scott McKinnon will cover Wood’s role until the new structure takes effect in March.
It will see the Bank expand its leadership team from six to eight. Accordingly reporting lines and roles will change.
The RBNZ needs to recruit five people to fill vacant leadership roles.
One of these vacancies has been created by the resignation of Deputy Governor and General Manager Financial Stability Geoff Bascand, who is due to leave in January.
The RBNZ also needs to hire a chief economist to replace Yuong Ha, who recently resigned and will depart in February.
Both Ha and Bascand are part of the Monetary Policy Committee, which effectively sets interest rates.
RBNZ Governor Adrian Orr said, “Andy and Toby have both achieved a huge amount in their careers at the RBNZ. Toby has overseen first class policy advice that has driven a significant expansion of our regulatory responsibilities, and Andy has successfully nurtured talent and led the growth to support our more intensive supervision approach."
RBNZ board hadn't raised concerns over staffing with Robertson
Interest.co.nz asked Finance Minister Grant Robertson whether he was concerned about staff turnover at the RBNZ. He responded, “I’m still comfortable with the Governor and I think the Governor’s been doing a really good job.
"The board of the RBNZ is ultimately responsible for managing matters from a governance point of view with respect to staffing, and I haven’t had concerns raised about that with me…
“I’m sure if the board had concerns about staffing they would raise them with me.”
Members of Parliament will have an opportunity to question Orr and other senior leaders when they appear before the Finance and Expenditure Committee for the RBNZ's annual review at 8am on Wednesday.
Annual staff turnover at the RBNZ sits at 13.5% - only just above the 20-year average of 13.0%. It was 19.3% in 2018 (the year leadership changed), 16.5% in 2019, and 11.4% in 2020.
The Bank has increased its staffing levels from 274 full time equivalents in 2019, to 349 in 2020, and 411 in 2021.
Accordingly, the average length of time RBNZ employees have been at the bank has been falling. At 5.2 years, it’s below the 20-year average of 7.9 years.
For an opinion on staffing and policy changes at the RBNZ, see this piece written last month.
40 Comments
The organisation is restructuring. Staff taking fat pay outs as their roles become "redundant" and choosing not to apply for "new roles" that pay half as much. Same process IRD, MOBIE and other government departments are going through at the moment. Sell the sky is falling narrative though, get those upvotes.
Yep that is what is going to happen. They are going to inflate away the debt at the expense of every New Zealand pay packet. They cannot raise rates. Sure they will jaw bone, and we may have the odd .25% here and there. But it will, all be show. There will not be a realistic attempt to use interest rates to control inflation. They cannot do it without crashing the Ponzi and no reserve bank employee or politician wants to be seen as responsible for that.. There is also Christmas and Turkeys and our next potential PM has 6 houses. Do you really think he is going to push away his own gravy
Fact is any of about fifty solutions could have been implemented in the last 10 years to prevent us being in this situation. But nothing has been done and the only changes implemented have been pro property investors during early covid.
We need political change and media change before anything happens.. the current system has created this and will only make this worse.
There's something a bit unsettling about all of this. I can't quite put my finger on it, and maybe the new staffing will put the unease to bed. Hopefully it's great leadership from Adrian; recognising that a change in direction is needed. Whatever it is, I genuinely hope it works.
The people who are leaving may have made some shocking decisions. (I aggregate, I think they all have. We shouldn't be where we are) but they didn't do it because they thought it was the wrong thing to do. On the contrary, their training and education told them what to do. And that's the problem. They, and any likely successor, have been trained in the same manner and will make the same 'mistakes'.
It's going to take some real courage to change direction. Real courage that supports the 'unconventional', and whilst I hope Adrian Orr has that in him,....well, let's wait and see.
A big problem is there's no playbook for how to manage this particular time and place in economic history. Even the wisest financial minds on earth don't know what to do.
So I can imagine it's not the nicest place to be. Doubly when you see the lynch mob trying to find their witch.
It's Ardern!!
No, it's Orr, he's done this!
Why not neither.
I defer again to the wider world. Some countries have inflation at levels far higher. Economies are in tatters. Housing is more unaffordable anywhere people want to live (I had to laugh on here a few weeks back when someone suggested cheap real estate in Detroit). Countries have opened up, and locked down again.
NZ is doing pretty well, comparatively, in an adverse situation. Some of that's luck, some of its half competent stewardship, from organisations (the govt and RBNZ) used to making decisions over much longer, more stable timeframes.
We keep hearing that (even though the Government does have a pandemic playbook). Along with it being a “tricky” virus. The reality, however, is that history has plenty of examples of what to do and what not to do. Just because it’s politically inconvenient or difficult does not mean that there isn’t good or bad precedents or that smart people don’t know what to do. I think many people know what has to be done, but it’s only human to kick the can and protect one’s own self interests for as long as possible.
I don't recall there being an analogous set of circumstances to this.
There's been pandemics, but in the times of sailboat and horse, rather than a global air network, with just in time delivery and such an interconnect global supply chain.
Seems to be a lot of hard ons for housing prices and interest rates but those are mainly collateral damage to far greater disruption.
Ahhh yes, the exodus continues, exactly as I thought it would. Wait for Orr to go, that's when we really know s$%t is about to hit the fan... he likely has the nous to jump ship just before, to absolve himself of all responsibility. Either that or he will be fired, GR has set him up as a hell of a patsy by recently giving them an impossible task of balancing 12 balls on their nose while juggling chainsaws.
Hi Jenee,
Jacinda Arden in 2017 when was asking votes to get into power. Can you when meet / interview show her this statement and ask for her response, now - will be interesting to see how she, now a seasoned politicians twists and manipulate.
Flashback 2017: "I don't accept that our teachers, nurses, and police officers can't get into their first home... I do not accept that is the future of this country" - Jacinda Ardern 4/7/2017
Not fair on Jenee, to be honest, to shoulder this burden alone given that she has inconvenienced dear leader once already. Sure she can ask the 1 question she will get this quarter, but it will be followed up by a patsy from Jessica or Tova about whether Santa has been given a vaccine pass. The broader problem is that there’s a cabal in the gallery enamoured with Ardern and determined not to ask hard follow up questions that unwind the spin and deflection. This is the real erosion of Western democracy where the media become fans of political celebrities, left or right, and befriend politicians (John Campbell ridiculously so this week) rather than maintain arms length impartiality to ensure that the state is held accountable. As a result, we will continue to slide, relative to Asia, and possibly end up as New Argentina (at best) or New Zimbabwe (at worst). Savage wept.
I think the US stock market is about to tumble, and suspect that Orr's officers are scuttling for the life rafts before they have to deal with whatever is next for NZ sitting on house prices 10xAvg income and commensurate household debt.
Time for another bowl of popcorn.
The relentless S&P rise is starting to look shaky, and some of the chart nerds on Youtube I follow are saying the pattern indicates it is about to break out to the low side. The markets seem well set for a taper tantrum and the Fed is not making any signs of backing down on the taper, and the chat is that Powell got reappointed by promising Biden he'd tackle inflation (which Biden wants before the mid term elections in Nov next year so his poorer voters feel less shat on by rising prices).
It just seems to add up to me that the bosses have decided it is better to have a big stock market correction that the Democrats paying a price at the ballot box.
I propose an activity of imaginary happiness: close your eyes and imagine a NZ where the RBNZ hasn't been active for the last 10 years. You live in a country where the average house is about 450,000, and, if you had a house, your dream house is about 650,000, the interest rate is around 6% so saving a bit of money is rewarded, the inflation rate is around 1% and you have 30% of your income as discretionary.
You can do the same activity as a house investor and you will get a nightmare situation where you owned fewer than 15 houses (you may even need to find a job) or as a banker, and your company has made less than 5 billions this year and you probably need to think about working with productive businesses and not just with houses.
The Bank has increased its staffing levels from 274 full time equivalents in 2019, to 349 in 2020, and 411 in 2021.
Eye-watering, exactly 50% increase in FTE staff in two years. What possible justification is there for such an inflation in the size of the bureaucracy? (It's not just the RBNZ, either.) Has the amount of work done by the RBNZ increased by 50% in that time?
This is a real shame. Both gentlemen are very good at what they do (I say this as a banker on the receiving end of their regulation and supervision). Andy has been particularly good at relationship building, which has not always been great from the RBNZ. References to the titanic and rats leaving the sinking ship are hyperbole but this is a loss.
May be we need more spotlight on the working of the RBNZ ?
Who reviews its performance and how does that performance reports looks like ?
Is there a Parliamentary oversight built in in our system ? What is the role of Treasury ?
Is the appointment of the Governor subject to Parliamentary approval ? If not, should that happen ?
What is the level of independence of RBNZ ?
Good opportunity for Simon Bridges to exercise his mind ?
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