19 Effect of directions on operational objectives

(1)

This section applies if the Governor considers that giving effect to a direction under section 17 or 18 (while not being inconsistent with the economic objectives of monetary policy) would be inconsistent with 1 or more operational objectives set out in a remit.

(2)

The Governor may, by notice in writing,—

(a)

advise the Minister that the Bank will, in giving effect to the direction, be unable to give effect to those operational objectives; and

(b)

request that the operational objectives be amended or replaced.

(3)

The Governor may only give a notice with the approval of the MPC.

(4)

If a notice is given,—

(a)

the MPC and the Bank are not required to give effect to the existing operational objectives:

(b)

the Minister must, within 1 month after the notice is given,—

(i)

make a recommendation under clause 6 of Schedule 2 for the purpose of replacing a remit to amend or replace the operational objectives; or

(ii)

give advice under section 12 for the purpose of amending or replacing the operational objectives in a remit that is included in an order in force under that section.

(5)

Subsection (4) does not apply if the Minister withdraws the direction.

Section 19: replaced, on 1 April 2019, by section 9 of the Reserve Bank of New Zealand (Monetary Policy) Amendment Act 2018 (2018 No 59).