1.2  Role of the administering department

In supporting the Minister responsible for each appropriation or class of outputs, the administering department has four key tasks:

• identifying the non-departmental appropriations and output classes for the annual Appropriation (Estimates) Bill and providing this information to the Treasury each year
• identifying the expected service performance or results for the Information Supporting the Estimates and providing this information to the Treasury each year
• managing and monitoring the contract related to the delivery of the services or results, and
• assisting the Minister to prepare the section 32A report.

Each of these key tasks is discussed below.

1.2.1  Identifying non-departmental appropriations and output classes for the Appropriation (Estimates) Bill

Each Appropriation (Estimates) Bill contains a Schedule listing those non-departmental appropriations and output classes in respect of which reports pursuant to section 32A of the PFA are required. Once passed, the Appropriation (Estimates) Bill becomes the Appropriation (Estimates) Act.

Departments are asked by the Treasury each year to identify which appropriations and output classes for the Votes they administer that should be included in that Schedule. Departments do this by referring to section 32A of the PFA and applying the criteria and thresholds agreed by FEC, as discussed below.

At this time, the administering department will also need to identify any new section 32A appropriations for the current year for inclusion in the Supplementary (Appropriations Estimates) Bill.

1.2.1.1  Agreed criteria and thresholds

Reports are required on the service performance or results achieved during the relevant financial year in relation to:

• Each non-departmental other expense appropriation or non-departmental capital expenditure appropriation except where:
  • The House already receives or has ready access to information that covers the key aspects of performance relevant to the appropriation or
  • The inherent nature of the transaction or causal event giving rise to the expense or expenditure means there is likely to be little additional performance information that could be usefully reported on an annual basis, or
  • The annual appropriation (or its annual average equivalent for multi-year and permanent appropriations) is under $5 million for other expenses or under $15 million for capital expenditure.

And

• Each output class within a non-departmental output expense appropriation except where:
  • There is already a requirement or commitment to report to the House on service performance in respect of the whole of that output class, or
  • The expected level of annual (or annual average) expenses for the output class, or the part that would otherwise be unreported, is under $5 million.

In considering which non-departmental output classes to identify, departments need to be aware that a section 32A report may be required, where there is an appropriation, and when a Crown entity has been exempted from having to provide a report on service performance for particular classes of outputs[5].

In considering which non-departmental other expense and capital expenditure appropriations to identify, departments will need to apply the criteria set out above to all such non-departmental appropriations they administer.

Administering departments also need to be aware that there is not much additional performance information that can be provided on:

• Debt or equity injections to an entity on normal terms, whether or not that entity provides an annual report to the House or
• “Technical” non-cash expenses such as depreciation expenses for the Parliamentary Complex and Library, or the write-down to fair market value of court-imposed fines owed to the Crown, or
• The expenses of independent people or bodies that are met but not set by the Crown and are not contingent on any specific deliverable, such as the payment of salaries and allowances to statutory office holders like judges and MPs, or subscriptions to international bodies in which New Zealand is a participating member, such as the United Nations or the OECD.

1.2.1.2  Relevant appropriations and output classes uploaded to CFISnet

Administering departments, having identified the relevant appropriations and outputs that will require a section 32A report, need to provide this information to the Treasury on CFISnet as part of the Estimates upload, so that the information can be included in:

• a Schedule to the Appropriation (Estimates) Bill, and
• if necessary, for inclusion in the Supplementary Appropriations (Estimates) Bill.

Departments should note any Vote/Name changes.

A template for this purpose is made available each year on CFISnet (under the ‘Treasury Circulars' menu). The date for this information to be provided to the Treasury each year is included in the annual Budget circular as well as on the template.

1.2.2  Identifying expected service performance or results for the Information Supporting the Estimates

It is at this stage, when identifying expected performance or results for the Information Supporting the Estimates, that administering departments have the first opportunity to improve the quality of performance information as expected service performance or results provide the basis for the later comparison within a section 32A report.

Administering departments need to put in place meaningful measures for the expected service performance or results. Where possible, administering departments should discuss measures for the expected service performance or results with those being contracted to provide the service or achieve particular results, and include these in the contract. Departments should access each output that will be provided and consider if performance measures or results are needed, rather than decide this at the appropriation level. This may assist departments with later reporting.

Guidance on performance measures and standards or expected results for other expense and capital expenditure appropriations can be found in Estimates, Supplementary Estimates and their Supporting Information: Technical Guide for Departmentshttp://purl.oclc.org/nzt/g-etg.

1.2.2.1  Expected service performance or results uploaded to CFISnet

Administering departments, having identified the expected service performance or results that will be reported in a section 32A report, need to annually provide this information to the Treasury on CFISnet as part of providing the Information Supporting the Estimates.

1.2.3  Managing and monitoring the contract related to the delivery of the services or results

Administering departments will need to manage and monitor the contract for the delivery of the services or results according to their own policies and procedures. Reporting required of the provider in the contract, should assist with the preparation of the section 32A report at the end of each financial year.

1.2.4  Assisting the Minister to prepare the section 32A report

The section 32A report must provide a comparison of the expected to actual service performance or results. A good section 32A report can be a powerful way to promote better understanding and debate about how resources were used, what was achieved in comparison to what was forecast, and how to improve performance. The non-financial information ie, the performance story is just as important as the financial information.

Administering departments are encouraged to:

• include where relevant comparative (trend) information from earlier years to give a fuller picture of the long-term progress being made over time, and
• apply the same standards of reporting to section 32A reports as is expected in their own departmental annual reports.

1.2.3.1  Period covered

The section 32A report covers the results achieved by use of the appropriation or class of outputs during the preceding financial year (ie, 1 July to 30 June).

1.2.3.2  Report structure

To facilitate consistency within the compendium of reports presented to the House, this guidance outlines a preferred content and structure for individual reports. A template for section 32A reports can be down loaded from http://purl.oclc.org.nzt/g-nda.

Section 32A reports are Parliamentary papers and must conform to the requirements for Parliamentary papers promulgated by the Office of the Clerk.[6]Under current requirements, Parliamentary papers must be produced in A4 size and include the appropriate shoulder number in the top right corner of the cover and title page. The shoulder number for each individual report is B.14 followed by the name of the Vote in parentheses eg, B.14 (Conservation). The shoulder number for the compendium of reports is B.14.

A single report is to be prepared covering all appropriations and output classes being reported on within a Vote. If two or more Ministers are responsible for appropriations within a Vote (eg, Vote Education), a single report is to be prepared on behalf of all the Ministers.

The statement of service performance or statement of result may cover the performance of, or the results achieved from, more than one non-departmental appropriation if to do so would add to the value and accessibility of the report, and the appropriations have the same responsible Minister and administering department.

For an output class where only part of the class would otherwise be unreported, the report may cover the whole class or the unreported part, at the discretion of the Minister responsible for the appropriation.