Annual Report 30 June 2011

Statement of objectives and service performance

For the year ended 30 June 2011

The Minister of Foreign Affairs purchased from the Ministry provision of the following 10 output expenses in Vote Foreign Affairs and Trade, and two output expenses in Vote Official Development Assistance:

Vote Foreign Affairs and Trade

• Administration of diplomatic privileges and immunities
• Consular services
• Pacific Security Fund
• Policy advice and representation – international institutions
• Policy advice and representation – other countries
• Policy advice and representation – other countries (permanent legislative authority)
• Promotional activities – other countries
• Services for other New Zealand agencies overseas
• Hosting Pacific Islands Forum meeting
• Rugby World Cup: Guest of Government

Vote Official Development Assistance

• Management of Official Development Assistance Programme
• Strategic advice and evaluation

The following statement of service performance records results and services delivered for each of the above class of outputs as agreed between the Minister of Foreign Affairs and the Secretary of Foreign Affairs and Trade in the Statement of Intent 2009–2012 and the 2009/10 Estimates of Appropriations and Information Supporting the Estimates, as required by section 45 of the Public Finance Act 1989.

The following table lists departmental expenses by output expenses for the year ended 30 June 2011.

Departmental expenses by output expenses

30/06/10 Actual excl. re-measurement $000		30/06/11 Actual incl. re-measurement $000	30/06/11 re-measurement $000	30/06/11 Actual excl. re-measurement $000	2010/11 Supp. estimates	2010/11 Actual as % of final Supp. estimates
449	Administration of diplomatic privileges and immunities	1,492	(18)	1,474	1,525	97%
14,967	Consular services	20,075	(244)	19,831	19,850	100%
2,419	Pacific Security Fund	1,478	(18)	1,460	2,272	64%
51,399	Policy advice and representation – international institutions	59,618	(726)	58,892	59,825	98%
238,305	Policy advice and representation – other countries	214,004	(2,605)	211,399	227,370	93%
34	Policy advice and representation – other countries (PLA)	646	(8)	638	790	81%
396	Promotional activities – other countries	150	(2)	148	350	42%
14,009	Services for other New Zealand agencies overseas	14,253	-	14,253	14,514	98%
-	Rugby World Cup: Guest of Government	18	-	18	45	40%
-	Hosting of the Pacific Islands Forum Meeting	68	-	68	100	68%
29,231	Management of Official Development Assistance Programme	50,863	-	50,863	51,151	99%
9,242	Strategic evaluation and advice	11,085	-	11,085	12,124	91%
360,451	Total departmental output expenditure	373,750	(3,621)	370,129	389,916	95%

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Vote Foreign Affairs and Trade

Ministerial Services

We provided the following services for Ministers across its two votes in the 2010/11 financial year. This information is aggregated from across all output expense classes to provide clearer reporting.

Performance

The quantity measures for Ministerial services are largely demand driven. While the number of Ministerial letters prepared was less than Expected, the number of Official Information Act (OIA) requests (OIA) that we responded to exceeded initial expectation. The unexpectedly large volume contributed to the underachievement of timeliness measures for OIA requests. As part of Ministry 20/20, we are considering to establish a ministerial services unit.

Performance measures	Expected/ target	2010/ 11 Actual	2009/10 Actual	2008/09 Actual
Number of Ministerial letters prepared	1,650–1,800	1,146	1,968	1,558
Number of Parliamentary Question responses provided	160–330	187	159	129
Number of OIA request responses provided	200–240	260	237	179
Percentage of Ministerial correspondence completed within 10 working days27	90%	85%	37%	New measure 2009/10
Percentage of Ministerial correspondence accepted without amendments	95%	97%	-	New measure 2010/11
Percentage of OIA requests completed within 20 working days28	70%	47%	67%	New measure 2009/10
Percentage of OIA requests completed within 40 working days29	95%	83%	88%	New measure 2009/10

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Output expense: Administration of diplomatic privileges and immunities

This output expense involves the administration of the Government’s responsibilities and obligations under the Diplomatic Privileges and Immunities Act 1968 and the Consular Privileges and Immunities Act 1971, which give effect to the 1961 Vienna Convention on Diplomatic Relations and the 1963 Vienna Convention on Consular Relations.

Services we provided include:

• the administration and facilitation of privileges and immunities to members of the diplomatic and consular corps and their dependants
• the resolution of immunity issues arising under the Vienna Conventions on Diplomatic and Consular relations
• the facilitation, documentation and formalities for the appointment of diplomatic and consular staff of foreign missions and consular posts accredited to New Zealand
• the provision of host government services to the diplomatic and consular corps
• the provision of advice to Ministers, diplomatic missions, government agencies and other parties regarding the interpretation and application of diplomatic and consular privileges and immunities in New Zealand.

Performance

We have met most of our performance standards for this output expense class. This means that New Zealand’s responsibilities and obligations under the respective Vienna Conventions on Diplomatic and Consular Relations, the Diplomatic Privileges and Immunities Act 1968 and the Consular Privileges and Immunities Act 1971, were fulfilled.

Performance measures	Expected/ target	2010/ 11 Actual	2009/10 Actual
Quantity
Diplomatic and consular staff of foreign missions in New Zealand at 30 June30	500–520	792	New measure 2010/11
Policy papers produced for Ministers or Cabinet under this output expense class	6–10	8	New measure 2010/11
Quality
All documentation prepared in compliance with the Diplomatic Privileges and Immunities Act 1968 and Consular Privileges and Immunities Act 1971 and the Vienna Convention on Diplomatic Relations and the Vienna Convention on Consular Relations	100%	100%	New measure 2010/11
Percentage of policy advice rated as 4 or better on a scale of 1–5 by external review against the Ministry’s quality standard for analysis and advice31	80%	79%	New measure 2010/11
Timeliness
All arrival and departure documentation for foreign diplomats in New Zealand completed within 10 working days	95%	95%	100%
All programmes of calls requested by foreign Heads of Mission processed within 10 working days	95%	95%	100%
All documentation for New Zealand Head of Mission appointments processed within a timeframe of six weeks32	95%	95%	92%

Financial performance (Figures are GST exclusive)

30/06/10 Actual $000		30/06/11 Actual $000	30/06/11 Main estimates $000	30/06/11 Supp. estimates $000
	Revenue
459	Crown	1,499	1,971	1,525
459	Total revenue	1,499	1,971	1,525
451	Total expenses	1,492	1,971	1,525
8	Net surplus	7	-	-

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Output expense: Consular services

This output expense concerns the provision of consular and notarial services to New Zealanders abroad. This includes helping New Zealanders in distress, providing a response capability in the event of an emergency involving New Zealanders overseas, such as a terrorist incident or natural disaster, and formally validating documentation for use in other countries.

Performance

The provision of consular services are demand driven, making it difficult to forecast the volume of service required by consular staff. In 2010/11 – the volume of work we handled exceeded all the expected targets. In particular, we responded to an unprecedentedly high number of general consular enquires of 54,812, exceeding the number recorded for the 2009/10 year by more than 25%.

We contracted an independent research company, Research New Zealand, to conduct a client satisfaction survey for those who had used consular services over the past year. The results from the survey are highly positive. Eight-three percent of survey respondents were satisfied with their experience with consular services. This places the survey in the 11th place among 38 government services who use the State Services Commission endorsed Common Measurements Tool (CMT)³³ for service satisfaction benchmark. While we have missed our target of being in the top quartile among the CMT users, the survey captured some very positive feedback from New Zealanders who have received consular assistance. This is a very heartening result for our dedicated staff at overseas posts and in the Wellington office.

Client satisfaction survey

Performance measures	Expected/ target	2010/11 Actual	2009/10 Actual	2008/09 Actual
Quantity
Number of overseas locations where consular services are provided	61	62	-	-
Distressed New Zealanders overseas who received consular services	2,000–2,400	2,446	2,413	2,213
General consular advice enquiries responded to	42,000–46,000	54,812	39,566	38,655
Notarial services provided	8,800–9,600	10,384	9,478	8,999
Consular emergencies responded to	3 to 6	3	4	4
Quality
Survey of recipients of consular services rate the Ministry’s service performance for consular services in the top quartile of departments using the State Services Commission’s Common Measurement Tool to measure their service performance34	Service performance in top quartile	11th of 38	Not measured	Not measured
Lessons learned reviews conducted on all consular emergencies (eg, floods in Australia, unrest in Middle East and North Africa, and Japan earthquake and tsunami)	100%	100%	Not measured	Not measured
Lessons learned incorporated into procedures or otherwise actioned within 6 months	95%	100%	Not measured	Not measured
Percentage of policy advice rated as 4 or better on a scale of 1–5 by external review against the Ministry’s quality standard for analysis and advice	80%	79%	Not measured	Not measured

Financial performance (Figures are GST exclusive)

30/06/10 Actual $000		30/06/11 Actual $000	30/06/11 Main estimates $000	30/06/11 Supp. estimates $000
	Revenue
14,989	Crown	19,414	23,764	19,500
556	Other	537	350	350
15,545	Total revenue	19,951	24,114	19,850
15,027	Total expenses	20,075	24,114	19,850
518	Net surplus/(deficit)	(124)	-	-

Explanation of significant variances

Expenditure includes $19.831 million appropriated expenditure, with the over-spend related to the $244,000 remeasurement of the Ministry’s forward exchange contracts for the year ended 30 June 2011.

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Output expense: Pacific Security Fund

This output expense supports the implementation of New Zealand’s Pacific Security Strategy. The Pacific Security Fund (PSF) is a $3 million contestable inter-agency fund, which we administer. The fund is drawn on by government departments and agencies to meet the cost of activities that advance or protect New Zealand’s security interests by reducing risks from threats arising in or operating through Pacific Island countries.

Performance

We coordinated the work of the Pacific Security Coordinating Committee (PSCC) in taking a whole-of-government approach to the assessment of proposals for funding from the PSF. We also managed expenditure under the PSF. In 2010/11, there has been an under expenditure of $0.794 million compared to the supplementary estimates. This was primarily due to a reduced number of project applications from government agencies being submitted to the PSCC for consideration, some projects coming substantially under budget and some not proceeding because of a range of external factors.

The internal review of activities was not completed for 2010/11 as planned, due to staff vacancy. However, an independent assessor undertook an evaluation of two of the larger PSF projects and found that they had given value-for-money with substantial benefits for both Pacific island countries security and protection of New Zealand interests.

Performance measures	Expected/ target	2010/ 11 Actual	2009/10 Actual
All programmes and project bids are assessed as consistent with the Pacific Security Strategy, and this is confirmed by periodic audit.35	100%	Partially met	100%
Funds are accessed, disbursed and monitored in accordance with the management process established by the Pacific Security Coordinating Committee.36	100%	100%	100%
All activities assessed as being of high quality by internal review.37	100%	Not measured	Not all targets met

Financial performance (Figures are GST exclusive)

30/06/10 Actual $000		30/06/11 Actual $000	30/06/11 Main estimates $000	30/06/11 Supp. estimates $000
	Revenue
2,748	Crown	2,265	3,240	2,272
2,748	Total revenue	2,265	3,240	2,272
2,429	Total expenses	1,478	3,240	2,272
319	Net surplus	787	-	-

Explanation of significant variances

The under-expenditure was primarily due to delays in other agencies projects where funds had been allocated in the 2010/11 financial year under the PSF’s contestable structure.

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Output expense: Policy advice and representation – international institutions

This output expense is concerned with policy advice and representation activities directed to the management of New Zealand’s membership of, and foreign affairs and trade interests in, international institutions. This includes major areas of multilateral cooperation to which the Government has decided to give special attention such as international trade in goods and services, counter-terrorism, disarmament and arms control, international environment and human rights issues.

The organisations include:

• the UN and its associated institutions
• the WTO
• the Commonwealth and its associated institutions
• the OECD
• Antarctic organisations
• international environmental organisations
• international disarmament organisations

Performance

Performance measures	Expected/ target	2010/ 11 Actual	2009/ 10 Actual
Quantity
Policy papers produced for Ministers or Cabinet under this output expense class38	300–350	168	Not measured
Active treaty negotiations serviced by the Ministry under this output expense class39	44	55	Not measured
Quality
Percentage of peers rating the quality of the Ministry’s negotiation of international agreements as 4 or better on a scale of 1–5 against the Ministry’s quality standard for negotiation40	80%	76%	Not measured
Percentage of policy advice rated as 4 or better on a scale of 1–5 by external review against the Ministry’s quality standard for analysis and advice (see the output expense class Administration of diplomatic privileges and immunities for the Ministry’s quality standard for analysis and advice, and related caveats for this measure)41	80%	79%	Not measured

Financial performance (Figures are GST exclusive)

30/06/10 Actual $000		30/06/11 Actual $000	30/06/11 Main estimates $000	30/06/11 Supp. estimates $000
	Revenue
52,387	Crown	59,881	65,258	59,825
52,387	Total revenue	59,881	65,258	59,825
51,604	Total expenses	59,618	65,258	59,825
783	Net surplus	263	-	-

Explanation of Significant Variances

The under-spend is primarily due to net realised foreign exchange losses.

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Output expense: Policy advice and representation – other countries

This output expense is concerned with policy advice and representation activities directed towards the management of New Zealand’s foreign affairs and trade relations with other countries, focusing on individual country relationships and regional organisations of significance to New Zealand.

Performance

The performance on this output expense relates closely to Outcome 1 “New Zealand’s security and economic interests safeguarded through its political and security relations” All the quality measures for this output expense class were introduced in 2010/11 and the targets were set independent of prior information on the likely level of service performance. Despite this, performance levels achieved are very close to the targets. The 2010/11 results will serve as benchmarks against which the Ministry can measure its ongoing performance.

Performance measures	Expected/ target	2010/11 Actual	2009/10 Actual
Quantity
Active formal negotiations serviced by the Ministry	51	42	Not measured
Inwards visits supported by the Ministry	130–180	94	Not measured
Outwards visits by New Zealand Ministers supported by the Ministry	30–40	38	Not measured
Policy papers produced for Ministers or Cabinet42	900–1100	493	Not measured
Quality
Percentage of peers rating the quality of the Ministry’s negotiation of international agreements as 4 or better on a scale of 1–5 against the Ministry’s quality standard for negotiation43	80%	76%	Not measured
Percentage of visits rated as 4 or better on a scale of 1–5 by internal review against the Ministry’s visits quality standard for visits management44	80%	80%	Not measured
Percentage of policy advice rated as 4 or better on a scale of 1–5 by external review against the Ministry’s quality standard for analysis and advice45	80%	79%	Not measured

Financial performance (Figures are GST exclusive)

30/06/10 Actual $000		30/06/11 Actual $000	30/06/11 Main estimates $000	30/06/11 Supp. estimates $000
	Revenue
238,210	Crown	218,118	248,632	227,845
571	Other	429	315	315
238,781	Total revenue	218,547	248,947	228,160
239,312	Total expenses	214,004	248,947	228,160
(531)	Net surplus/(deficit)	4,543	-	-

Explanation of significant variances

The under-expenditure is primarily related to savings in travel costs, reduction in ECA taxable allowances and reduced tax on overseas terms and conditions, staff vacancies and no remuneration market movement, anticipated costs related to closure of posts which did not eventuate and property rental costs less than anticipated due to the recessionary impact on rents. These savings were offset by accelerated depreciation and amortisation of assets due to change in capital plans and impairment of assets such as the Beijing Chancery, contracting service costs due to unfilled vacancies, and re-measurement of the Ministry’s forward exchange contracts for the year ended 30 June 2011.

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Output expense: policy advice and representation – other countries (Permanent legislative authority)

This output expense is limited to the costs set out in the Foreign Affairs Act 1998, of superannuation for local staff employed by overseas posts to help with the management of New Zealand’s foreign and trade relations with other countries.

Performance

The New Zealand Government Superannuation scheme for locally engaged staff in the United States is fully funded which makes the scheme financially viable.

Financial performance (Figures are GST exclusive)

30/06/10 Actual $000		30/06/11 Actual $000	30/06/11 Main estimates $000	30/06/11 Supp. estimates $000
	Revenue
43	Crown	790	21	790
43	Total revenue	790	21	790
34	Total expenses	646	21	790
9	Net surplus	144	-	-

Explanation of significant variances

The requirement to fund the unfunded liability of the North American locally engaged superannuation scheme was less than anticipated.

Output expense: promotional activities – other countries

This output expense supports the promotion of investment in New Zealand by funding a range of activities including:

• enhancing the understanding of New Zealand and offshore markets as investment destinations
• demonstrating the Government’s interest in attracting investment to New Zealand and support for New Zealand industries undertaking overseas direct investment activities
• establishing and maintaining influential overseas investment contacts
• supporting investment-related visits to and from New Zealand
• enabling New Zealand industries to undertake overseas direct investment activities to support their sustainable growth and international competitiveness.

Performance

Performance under this output expense class was independently reviewed during 2009 along with other Ministry funds that are disbursed through a contestable mechanism. A follow-up review in 2011 confirmed that improvements have been made to the administration of the output expense class to ensure better alignment with Government priorities, including regular strategic discussions between us and NZTE – Investment colleagues.

An evaluation of activities undertaken under this output class in 2010/11 concluded that they had made valuable contributions to New Zealand’s investment goals in a number of areas. Particular highlights included:

• networking and promotional activities held in conjunction with the 10th Busan International Film Commission and Industry Exhibition in Seoul in October 2010
• events in London and Los Angeles that promoted New Zealand’s Investor Plus immigration category to selected high net worth individuals
• the launching of the New Zealand – Saudi Arabia Business Network in Riyadh in February 2011.

Performance measures	Expected/ target	2010/ 11 Actual	2009/ 10 Actual
All activities are in conformity with Government objectives and criteria	100%	100%	100%
All activities assessed as being of high quality by internal review	100%	100%	100%

Financial performance (Figures are GST exclusive)

30/06/10 Actual $000		30/06/11 Actual $000	30/06/11 Main estimates $000	30/06/11 Supp. estimates $000
	Revenue
680	Crown	350	500	350
680	Total revenue	350	500	350
398	Total expenses	150	500	350
282	Net surplus	200	-	-

Explanation of significant variances

The under-expenditure was primarily due to cancellation of some projects for which funds were allocated, or deferral of projects in the Trade Access Support Programme and the Investment Promotion Fund until 2011/12.

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Output expense: services for other New Zealand agencies overseas

This output expense involves the provision of services to other New Zealand agencies with overseas interests.

In 2010/11, services were provided to the following departments by our diplomatic and consular posts overseas:

• Ministry of Agriculture and Forestry⁴⁶
• New Zealand Customs Service
• New Zealand Defence Force
• Ministry of Economic Development
• Ministry of Education
• New Zealand Food Safety Authority⁴⁷
• Passports, Department of Internal Affairs
• Immigration New Zealand: Department of Labour
• New Zealand Police
• Ministry of Research, Science and Technology⁴⁸
• New Zealand Tourism Board
• New Zealand Trade and Enterprise
• The Treasury.

These services included assistance with staff transfers to and from posts, accommodation management, general administration such as the provision of receipting and banking facilities, and diplomatic facilitation. Ministry staff also undertook core agency work on behalf of agencies (for example issuing emergency travel documents on behalf of the Department of Internal Affairs and visa processing on behalf of Immigration New Zealand).

An aggregate total of 151 annual fee schedules were negotiated with agencies to cover the services provided by posts to agencies overseas. The fee schedules were calculated on a full cost-recovery basis, with monthly invoicing/payments.

Performance

The Ministry’s performance against the two quantity measures for this output exceeded the targets. However, it did not meet the service quality target. This quality measure was introduced in 2010/11 as a benchmark without prior knowledge of level of service satisfaction. The survey generated not only quantitative but also qualitative feedback on services to New Zealand government agencies offshore and will be taken into account through our transformational change programme, Ministry 20/20.

Performance measures	Expected/ target	2010/ 11 Actual
Number of seconded staff from other government agencies collocated in Ministry posts offshore	96	114
Number of locations providing services on behalf of other government agencies	46	47
Percentage of respondents rating the Ministry’s service performance as 4 or better on a scale of 1–549	80%	62%

Financial performance (Figures are GST exclusive)

30/06/10 Actual $000		30/06/11 Actual $000	30/06/11 Main estimates $000	30/06/11 Supp. estimates $000
	Revenue
14,010	Other	14,242	13,599	14,514
14,010	Total revenue	14,242	13,599	14,514
14,009	Total expenses	14,253	13,599	14,514
1	Net surplus/(deficit)	(11)	-	-

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Output expense: Rugby World Cup Guest of Government

This output expense is limited to the purchase of services to fund the cost of hosting of Guest of Government attending the rugby world cup (RWC).

We are playing a central role in contributing to whole-of-government efforts to make the most of the opportunities offered by the RWC. We have contributed Ministry resources to the RWC Guests of Government Taskforce established to manage a major programme of RWC Guests of Government visits.

Performance measure in estimates	Budgeted standard	Actual standard
Number of visits by leaders secured50	>4	Not measured51
Number of visits by other ministers secured.52	>12	Not measured53
Post implementation report on the visits programme confirms that its objectives were met and that visits were implemented to a high standard.54	Post implementation report on the visits programme confirms that its objectives were met and that visits were implemented to a high standard.	Not measured55

Financial performance (Figures are GST exclusive)

30/06/10 Actual $000		30/06/11 Actual $000	30/06/11 Main estimates $000	30/06/11 Supp. estimates $000
	Revenue
-	Crown	45	-	45
-	Total revenue	45	-	45
-	Total expenses	18	-	45
-	Net surplus	27	-	-

Output expense: Hosting the Pacific Islands Forum Meeting

This output expense is limited to the purchase of services to fund the hosting of the Pacific Islands Forum Meeting in Auckland in September 2011.

In early September New Zealand will be hosting the 40th Pacific Island Forum meeting in Auckland. In the 2010/11 financial year the Pacific Island Forum Taskforce was established to project manage this event.

Performance measure in estimates	Budgeted standard	Actual standard
Post meeting review confirms that the organisation of the meeting was to a high standard.	Post meeting review confirms that the organisation of the meeting was to a high standard.	Not measured56

Financial performance (Figures are GST exclusive)

30/06/10 Actual $000		30/06/11 Actual $000	30/06/11 Main estimates $000	30/06/11 Supp. estimates $000
	Revenue
-	Crown	100	-	100
-	Total revenue	100	-	100
-	Total expenses	68	-	100
-	Net surplus	32	-	-

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Vote Official Development Assistance

Output expense: Management of Official Development Assistance Programme

This output expense purchases the design and management of development assistance programmes, including the procurement, contract management and monitoring of development activities within programmes.

Performance

The contribution of this departmental output expense to outcomes is indirect, through the effective delivery, direction and management of the Crown appropriations of the New Zealand Aid Programme. Those results are provided earlier in this Annual Report, in the section on Our Outcomes. The Ministry’s delivery of outputs in 2010/11 against the Performance measures specified in the Statement of Forecast Service Performance in the 2010/11 Estimates was as follows:

Performance measure in estimates	Budgeted standard	Actual standard 2010/11	Actual standard 2010/09
Indicators of the quantity of output
Number of Programmes administered	30–32	Met – 33	33
Volume of Crown ODA resources administered	$484.9m	$495.0 m spent	$435.3 m spent, compared to appropriation of $483.8m
Indicators of the quality of output
Percentage of programmes rated 4 or higher on a scale of 1–5 by review against the Ministry’s quality standard for programme management	80% 57	Met – 83%	Not measured
Percentage of activities rated 4 or higher on a scale of 1–5 by review against the Ministry’s quality standard for activity management	80% 58	Met – 81%	Not measured
Feedback from programme partners on NZAID engagement	90% or more of partners report expectations met	Not Measured 59	Expectations met
Amount and proportion of sector-allocable ODA directed primarily to sustainable economic development60	$90.0m and 30%	Partially met – $100.6m and 27%	Met – $72 m & 28%
Number of activities61	750 or less	Met – 718	Met – 805
Median annual activity expense62	$150,000 or more	Met – $200,000	Met – $137,688
Percentage of the value of ODA delivered using higher order aid modalities63	55% or more	Met – 59% (by value)	Not met – 52% by value
Progress towards the Paris Declaration 2010 targets for aid effectiveness64	Progress	Progress – 2010 targets partially met	Not met
Percentage of activity payments on time	95%	Not met – 94%	Not measured

Financial performance (Figures are GST exclusive)

30/06/10 Actual $000		30/06/11 Actual $000	30/06/11 Main estimates $000	30/06/11 Supp. estimates $000
	Revenue
29,226	Crown	51,062	29,743	51,062
24	Other	115	116	89
29,250	Total revenue	51,177	29,859	51,151
29,231	Total expenses	50,863	29,859	51,151
19	Net surplus	314	-	-

The under-expenditure relates to travel cost savings, significant staff vacancies and corporate cost savings.

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Output expense: strategic evaluation and advice

This output expense is limited to the work and advice necessary to improve the overall effectiveness of development assistance, comprising international development research, evaluation of ODA programmes and activities, analysis and consultation leading to the development of ODA strategies and policies, the provision of advice on international development issues, and Ministerial services.

Performance

The contribution of this departmental output expense to outcomes is largely indirect, through the effective delivery, direction and management of the Crown appropriations of the New Zealand Aid Programme. Those results are provided earlier in this Annual Report, in the chapter on Our Outcomes. The Ministry’s delivery of outputs in 2010/11 against the Performance measures specified in the Statement of Forecast Service Performance in the 2010/11 Estimates was as follows:

Performance measure in estimates	Budgeted standard	Actual standard
Indicators of the quantity of output
Revision or development of programme strategies65	At least 4	Met – 12
Policy papers and submissions produced for Ministers or Cabinet under this output expense class	120–160	23966
Evaluations or activity reviews67	25–30	Met – 2568
Indicators of the quality of output
Percentage of policy advice rated as 4 or better on a scale of 1–5 by external review against the Ministry’s quality standard for analysis and advice	80%	79%
Reviews and evaluations comply with good practice guidelines	70%	Not met – 64%69
Programme strategies that are up to date as per the schedule of reviews and revisions70	100% (with numbers reported)	Not met – 83% (20 programmes)71

Financial performance (Figures are GST exclusive)

30/06/10 Actual $000		30/06/11 Actual $000	30/06/11 Main estimates $000	30/06/11 Supp. estimates $000
	Revenue
9,365	Crown	12,099	9,671	12,099
85	Other	-	33	25
9,450	Total revenue	12,099	9,704	12,124
9,242	Total expenses	11,085	9,704	12,124
208	Net surplus	1,014	-	-

The under-expenditure relates to travel cost savings, significant staff vacancies and corporate cost savings.

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Footnotes

[27] There was a marked improvement in meeting the Ministerial deadline, however we still fell just short of our performance target. This will be the subject of ongoing improvement actions.

[28] The statutory deadline for responding to Official Information Act requests is 20 days. Requests can, however, be extended under Section 15A of the Act “for a reasonable period of time having regard to the circumstances”. The 40 working day deadline is an attempt to represent an expectation of the outer limit of the criteria set out in Section 15A of the Act and follows the measure set out in the Ministry’s Estimates for the 2010/11 financial year. Figures exclude requests received by the Ministry but transferred to other agencies for reply.

[29] Refer to endnote 28.

[30] This quantity measure is largely demand driven. The figure of 792 does not include cross accredited diplomatic and consular staff or official dependants all of whom require the administration of diplomatic and consular privileges and immunities.

[31] The Ministry contracted an independent consulting firm, the New Zealand Institute of Economic Research (NZIER), to conduct the review on policy advice. A 10-point rating scale was used, which allow the results of the review to be comparable to the reviews of policy advice of other government agencies. The figure report here of 79% is the percentage of papers in the review given a score of 7 or above.

[32] This performance measure has been corrected. It had incorrectly been included in the forecaste Statement of Forecast Service Performance for 2010/11 (and previous years) as three weeks.

[33] The Common Measurements Tool is a set of survey questions and scales that allow State Services agencies to measure client satisfaction and identify service delivery improvements for service users. By using a common set of questions agencies are able to compare their performance with other State Services agencies, with the Kiwis Count national survey and also measure how they are progressing over time.

[34] Refer to endnote 33.

[35] Project bids were reviewed and assessed by an external assessor and the interdepartmental PSCC as being consistent with Government policy goals for Pacific security, although no audit has taken place.

[36] Funding was provided to implementing agencies as laid down in memoranda of understanding between MFAT and the agencies.

[37] The report on the performance of the Pacific Security Fund for year 2010/11 has not yet been produced due to resource issues.

[38] This measure is demand driven.

[39] The figure of 55 includes international agreements led by us as well as agreements led by other agencies. We are engaged in all these treaties at some point but the amount of work entailed varies from large multi-party agreements where we are the lead negotiator, to small-scale arrangements led by other departments. The figure also excludes our ongoing involvement in the functioning of and decision-making in already established international organisations.

[40] We conducted a survey of those who had negotiated alongside us over the 12 months to June 2011. The majority of survey respondents were peers from other New Zealand government agencies. The purpose of the survey was to assess the effectiveness of Ministry negotiator in the eyes of negotiation partners. The survey looked at six key areas: alignment with goals and priorities; negotiation skills; preparation, analysis and reporting; leadership and management; stakeholders management and communication, and continued capability development. The reported figure of 76% represents the percentage of 4 or above ratings in a 5 point scale, among all responses.

[41] Refer to endnote 33.

[42] This quantity measure is largely demand driven.

[43] Refer to endnote 40.

[44] We conducted an internal review of visits management. A panel of staff reviewed a randomly selected sample of 10 visits that took place in the 12 months to June 2011. The figure of 80% is the percentage of 4 or above ratings in a 5 point scale, among all assessed criteria.

[45] Refer to endnote 33.

[46] During the 2010/11 financial year it is noted that the Ministry of Agriculture and Forestry merged with the New Zealand Food Safety Authority, and the Ministry of Science and Innovation was established following the merger of the Ministry of Research, Science and Technology and the Foundation for Research, Science and Technology.

[47] Refer to endnote 46.

[48] Refer to endnote 46.

[49] For the first time, this year we invited peers from New Zealand government agencies who have received support services from the Ministry to participate in a client satisfaction survey. The figure of 62% represents the percentage of respondents who gave a 4 or higher rating on a 5-point rating scale, where 1 means ‘Very dissatisfied’ and 5 means ‘very satisfied’, to the question “How satisfied were you with the overall quality of service delivery?”

[50] Event to be held in September 2011 and will be reported against in the 2011–12 annual report.

[51] Rugby world cup to be held in September-October 2011 and will be reported against in the 2011–12 annual report.

[52] Refer to endnote 50.

[53] Refer to endnote 51.

[54] Refer to endnote 50.

[55] Refer to endnote 51.

[56] Refer to endnote 50.

[57] The New Zealand Aid Programme has 33 programmes it administrates in its official programme framework. For annual reporting purposes, three small regional programmes have been amalgamated together.

[58] In 2011, the New Zealand Aid Programme undertook its first ever quality management review of its programmes and activities against the quality standards in the Performance Information for Appropriations Vote Official Development Assistance. Six programmes and three to four activities (making a total of 21 Activities) under each Programme were reviewed.

[59] This indicator was difficult to measure meaningfully. Over 2011/12, MFAT will identify whether another measure and system would be more appropriate to measure this.

[60] The New Zealand Aid Programme received a new mandate in 2009 requiring a change of focus to sectors directly supporting sustainable economic development. The New Zealand Aid Programme’s expenditure on sectors directly supporting sustainable economic development (for example, transport and energy infrastructure, tourism and agriculture, etc) has increased from $72 million in 2009/2010 to $100.6 million in 2010/11. However, the proportion of expenditure was roughly the same as the previous year, which was 28%. This is due to a $60 million increase in total sector-allocable aid. The percentage figure is Expectedto increase significantly in 2011/12.

[61] A key threat to the effectiveness of the Vote Official Development Assistance (ODA) is the fragmentation of the New Zealand Aid Programme into a large number of small activities. New Zealand Aid Programme is progressively shifting the ration of ODA going from small, administratively expensive aid projects to larger higher impact, more comprehensive initiatives. Accordingly, targets have been set to decrease the number of activities and increase their average size.

[62] Refer to endnote 61.

[63] The use of fewer, longer and deeper interventions reduces the transaction costs for partners, and improves the ability of donors to take a long term view. Such approaches are described as ‘higher order aid modalities’, and the New Zealand Aid Programme is targeting an increase in their usage.

[64] The Paris Declaration indicators and targets reflect the commitments of both donor and partner countries with a specific focus on: ownership, alignment, harmonisation; managing for results; and mutual accountability. The indicators and targets provide a benchmark against which individual donor agencies (like the New Zealand Aid Programme) or partner countries can measure their performance.

For more information on the Paris Declaration on Aid Effectiveness and the indicators please go to the OECD website: www.oecd.org/document A direct link to the indicators document is: www.oecd.org/dataoecd Progress for both donor agencies and partner countries can be found in the Cairns Compact Reporting (PIFS) and OECD-DAC Report on Survey on Monitoring the Paris Declaration (to be released in October 2011).

It is important to note that some indicators and targets and their achievement can be the responsibility of both donor agencies and partner countries, or each individually. With this in mind, for the Ministry’s Annual Report we have only reported against those indicators and targets that are the clear responsibility of the New Zealand Aid Programme (as a donor agency), and where information can be easily collated on an annual basis. These indicators and targets are reported on page 52.

[65] Each of the 30 country programmes administered by the Ministry is governed by a strategic framework or in the Pacific by a Joint Commitment for Development (JCD). Keeping these up to date, reflecting New Zealand government policy and partner priorities is important for achieving development results. Over 2010/2011, 12 strategic frameworks or JCDs were reviewed and/or developed, and have either been: signed-off (or in the process of being signed off) by the Minister; are being negotiated with partner countries; and/or have been substantially progressed.

[66] In 2010/11, the number of policy papers and submissions produced for Ministers or Cabinet is well above the budgeted standard. The number of ministerial submissions has increased significantly as MFAT has refocused its policies, programmes and activities, and undertakes organisational change, to reflect Government priorities. This increase is not Expectedto continue beyond this period of change.

[67] In 2010/11, 23 reviews and evaluations were completed and submitted to IDG’s Evaluation and Research Committee (ERC). This excludes two reviews/evaluations not yet submitted to ERC. The results of these reviews and evaluations are used to improve programme management, and also inform the MFAT Annual Report. The annual review of the quality of evaluations undertaken in 2010 as part of the New Zealand Aid Programme found that 64% of 22 evaluations meet all or most of the quality standards and 36% (eight reports) meet some of the quality standards.

[68] Refer to endnote 67.

[69] Refer to endnote 67.

[70] Refer to endnote 65.

[71] Twenty of the programme strategies are current. Nine strategies were not up dated as a result of the decision to develop a single ASEAN Regional Strategy, which will now encompass five existing programme strategies. Another three programme strategies have not been updated as a result of New Zealand’s Aid Programme review of the business model, which has meant that these programmes have been amalgamated or discontinued. Work on two programmes was delayed awaiting the finalisation of the international development policy, which has now been completed.

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