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4.1 Monitoring

Monitoring includes verifying that the terms and conditions under the funding agreement have been met. Monitoring will be based on:

  • Information reported by the NGO in accordance with the contract.
  • Information from other parties (e.g. surveys of users).
  • The ongoing relationship with the provider.
  • Reviews or audits conducted under the contract.
  • Information from other sources.

Government agencies want NGOs to deliver services under the current contract, but will also have an interest in their viability into the future. Ideally, the information sought should provide an indication of the ongoing viability of the NGO, the improvements in outcomes sought, not just outputs produced and certainly not focus mainly on inputs to the NGO’s activities.

Monitoring and contract management imposes costs on the purchaser and the NGO providing the service. There is a range of possible ways to reduce unnecessary costs, while still receiving assurance about the effective use of public money (see section 1.6 and section 1.12). This includes:

  • Realism about the number of reports required from NGOs.
  • Performance indicators should be simple, meaningful, and relate to contracts.
  • Supplying standard reporting templates to NGOs to fill in. Then the NGO need not generate a report itself, and the information is in a standard form. Some Government organisations now supply electronic templates.
  • Monitoring arrangements that are structured according to risk.
  • Where appropriate, developing contract and capability building objectives that are consistent with the NGO’s own performance management system. (eg objectives that make use of information that the NGO is already collecting)

Feedback on the monitoring should be provided in a timely manner to NGOs, to help them understand its use.

The level and nature of the monitoring undertaken by the Government agency may differ according to:

  • The nature of the service.
  • The track record of the NGO.
  • The amount of money involved.
  • Perceptions of risk.

Some Government agencies structure their monitoring arrangements according to assessments of risk. The basis for these assessments should be documented. This may mean focusing resources and greater attention on contracts where risk is assessed to be higher, and requiring some minimum reporting under the contract for lower risk contracts but providing for a power to do a more in-depth audit. The Government agency can then audit 1 in 10 (say) such contracts, either on a random basis, or on the basis of a risk assessment or a mixture of the two. This could include an audit of the Government agency’s contract management, as well as of the performance of the NGO.

Government agencies need to exercise informed judgement about such monitoring arrangements and where the agency’s resources are best directed as is appropriate in their own circumstances. (See also section 1.7)

Maori, hapu and iwi providers have often expressed the need for monitoring and reporting processes to focus more on outcomes that were collectively desired by Government and Maori communities. The outcomes reported against should also be culturally appropriate and relevant to the service provision model.

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