The idea is to have the pause to prevent a scrum forming, crouching down and exploding straight into the engage from the crouch in a springing action. When you pause, you have to stop and stabilise it, leading to a better engage.
It was originally an Australian invention. Introduced in the mid 1980's to depower the engage and prevent neck injuries. It worked. I'll dig out the citations for the medical papers that led to it being introduced.
Ash said:It (the touch) stops teams from delaying their crouch. A lot of pro teams used to commonly still be half standing up after the "crouch" call. They would then lower and launch themselves into the engage on "pause", to get around the whole purpose of the "pause" call.