Vote Economic Development - Supplementary Estimates and supporting information 2010/11

Details of Multi-Year Appropriations#

Details of Projected Movements in Departmental Net Assets#

Ministry of Economic Development

Information Supporting the Supplementary Estimates Vote Economic Development#

MINISTER(S) RESPONSIBLE FOR APPROPRIATIONS: Minister for Economic Development (M25), Minister for Industry and Regional Development (M39), Minister for Small Business (M62), Minister for the Rugby World Cup (M79)

ADMINISTERING DEPARTMENT: Ministry of Economic Development

MINISTER RESPONSIBLE FOR MINISTRY OF ECONOMIC DEVELOPMENT: Minister for Economic Development

Part 1 - Summary of the Vote#

Part 1.3 - Trends in the Vote

Summary of Financial Activity

Part 2 - Details and Expected Performance for Output Expenses#

Part 2.1 - Departmental Output Expenses#

Policy Advice - Small Business (M62)

Scope of Appropriation

Expenses and Revenue

Reasons for Change in Appropriation

This appropriation increased by $1,000 to reflect the increase in the GSF non-funding employer contribution rates.

Policy Advice and Sector Leadership - Firm Capability, Sectoral and Regional Development (M25)#

Scope of Appropriation#

Expenses and Revenue#

Reasons for Change in Appropriation#

This appropriation increased by $8.082 million as a result of:

• funding of $5.600 million to reflect a Cabinet decision relating to the "Government Procurement Reform Agenda - Year One Outcomes and Future Reform Programme" paper
• funding of $1.250 million to reflect a Cabinet decision relating to the "Canterbury Earthquake National Level Co-ordination Mechanisms" paper
• expense transfers from 2009/10 of $1.012 million to reflect the delays for the following projects:
  • "Wine to the World" and "Access to Ohakea" - $350,000
  • ongoing development and management of a Volunteer website for events - $260,000
  • Government's procurement reform training initiatives - $208,000
  • Auckland's research programme - $163,000, and
  • Cross Departmental Research Pool funded project - $31,000.
• funding of $184,000 to reflect a Cabinet decision relating to the "Rugby World Cup 2011 (Empowering) Act 2010: Proposed Regulations" paper, and
• GSF non-funding employer contribution increase in rates of $36,000.

These increases are partially offset by a decrease of $500,000 transferred to Vote Canterbury Earthquake Recovery.

Part 2.2 - Non-Departmental Output Expenses#

Analysis and Development Services for Firms (M25)#

Scope of Appropriation

Expenses

Reasons for Change in Appropriation

This appropriation increased by $4.204 million as a result of:

• $4.200 million fiscal neutral adjustment in the Primary Sector Initiatives, Business Opportunities in Australia and Support for export-focused firms, and
• $4,000 as a result of a foreign exchange movement adjustment.

Canterbury Earthquake Recovery Commission (M25)#

Scope of Appropriation#

Expenses#

Reasons for Change in Appropriation#

This appropriation was established during 2010/11 as a result of a Cabinet decision relating to the "Canterbury Earthquake National Level Co-ordination Mechanisms" paper.

Output Performance Measures and Standards#

Identification and Coordination of International Market Opportunities (M25)#

Scope of Appropriation#

Expenses#

Reasons for Change in Appropriation#

This appropriation increased by $10.963 million as a result of:

• $5.500 million funding through a fiscal neutral adjustment relating to the Primary Sector Initiatives, Business Opportunities in Australia and Support for export-focused firms
• $2.140 million reflecting the Cabinet decision relating to the "Supporting the Delivery of a Successful Rugby World Cup 2011" paper
• $2 million transfer from the Standardised Training and Advisory Services appropriation to assist with New Zealand exporters' operations based in Christchurch following the 22 February earthquake via the Christchurch Market Connections Fund
• expense transfer of $1.100 million from 2009/10 to reflect the delays in leveraging the Shanghai Expo
• transfer of $179,000 from Vote Foreign Affairs and Trade to assist with WTO and FTA/CEP negotiations, and
• $44,000 through a foreign exchange movement adjustment.

International Investment Facilitation Services (M25)#

Scope of Appropriation#

Expenses#

Reasons for Change in Appropriation#

This appropriation decreased by $3,000 as a result of foreign exchange movement adjustments.

New Zealand's Participation at Expo 2010 Shanghai, China (M25)#

Scope of Appropriation and Expenses#

Reasons for Change in Appropriation#

This appropriation increased by $8.217 million as a result of an expense transfer of 2009/10 unspent funds.

Regional and Sector Development Services (M25)#

Scope of Appropriation#

Expenses#

Reasons for Change in Appropriation#

This appropriation decreased by $7.649 million as a result of:

• transfer of $9.544 million to other non-departmental expense appropriations to assist with the Primary Sector Initiatives, Business Opportunities in Australia and Support for export-focused firms, and
• $590,000 transferred to the non-departmental output expense appropriation: Identification and Coordination of International Market Opportunities to reflect a Cabinet decision relating to the "Supporting the Delivery of a Successful Rugby World Cup 2011" initiative.

These decreases are partially offset by the following increases:

• expense transfer of $2.474 million from 2009/10 to reflect the delay in completing the Food and Beverage Taskforce initiatives, and
• $11,000 through foreign exchange adjustments.

Rugby World Cup (M79)#

Scope of Appropriation#

Expenses#

Reasons for Change in Appropriation#

This appropriation was established during 2010/11 as a result of a Cabinet decision relating to the "Rugby World Cup 2011 (Empowering) Act 2010: Proposed Regulations" paper.

Output Performance Measures and Standards#

Conditions on Use of Appropriation#

Stadium Development (GST component) (M25)#

Scope of Appropriation#

Expenses#

Reasons for Change in Appropriation#

This appropriation incurred a one-off cost of $27.873 million as a result of milestones being met by the Eden Park Redevelopment Board (EPRB) via a loan agreement with the Crown. Upon EPRB meeting these milestones, the loan would be forgiven and that it would become revenue to the EPRB and the GST would be payable. The Crown needs to fund this GST component as an Input Tax and the EPDB will be paying the Output Tax to the Inland Revenue Department. This impact is therefore neutral to the Crown.

Standardised Training and Advisory Services (M25)#

Scope of Appropriation#

Expenses#

Reasons for Change in Appropriation#

This appropriation decreased by $4.156 million as a result of:

• $6 million being transferred to the non-departmental output expense appropriation: Identification and Coordination of International Market Opportunities to reflect:
  • a Cabinet decision for funding of $4 million to assist with the "Supporting the Delivery of a Successful Rugby World Cup 2011" initiative, and
  • a transfer of $2 million to the Identification and Coordination of International Market Opportunities appropriation to assist with New Zealand exporters' operations based in Christchurch following the 22 February earthquake via the Christchurch Market Connections Fund.

This decrease is partially offset by the following increases:

• $1.244 million transferred to assist with the Primary Sector Initiatives, Business Opportunities in Australia and Support for export-focused firms, and
• expense transfer of $600,000 from 2009/10 to reflect the delays in the "Deferral of Global Mindset" project.

Part 5 - Details and Expected Results for Other Expenses#

Part 5.2 - Non-Departmental Other Expenses#

Canterbury Earthquake Recovery - Business Support (M25)

Scope of Appropriation

Expenses

Reasons for Change in Appropriation

This appropriation was established during 2010/11 as a result of a Cabinet decision relating to the "Canterbury Earthquake Business Support Package: Capability Development, Promotions and RWC Support" and "Christchurch Earthquake - Short to Medium Term Business Support Measures" papers.

Expected Results

Depreciation on Auckland's Queens Wharf (M25)#

Scope of Appropriation#

Expenses#

Reasons for Change in Appropriation#

This appropriation was established during 2010/11 to reflect the Cabinet decision relating to the "Queens Wharf Development" paper.

Expected Results#

Establishment and operation of the Food Innovation Network New Zealand (M25)#

Scope of Appropriation#

Expenses#

Reasons for Change in Appropriation#

This appropriation increased by $5.765 million as a result of:

• an expense transfer of $4.865 million from 2009/10 unspent funds, and
• $900,000 funding to reflect a Cabinet decision relating to the "Scaled Up Proposal for the Waikato Food Innovation Hub" paper.

International Biotechnology Partnerships (M25)#

Scope of Appropriation#

Expenses#

Reasons for Change in Appropriation#

This appropriation has decreased by $1.700 million as a result of:

• $1 million transfer to assist with the Rugby World Cup Legacy programme (MYA)
• 600,000 to reflect a Cabinet decision relating to the "Canterbury Earthquake Business Support Package" paper, transferring this amount to the non-departmental output expense: Canterbury Earthquake Recovery Commission appropriation, and
• $100,000 in savings returned to the Crown.

International Growth Fund (M25)#

Scope of Appropriation#

Expenses#

Reasons for Change in Appropriation#

This appropriation decreased by $10 million as a result:

• $5 million reprioritised to Square Kilometre Array, Rugby World Cup and Procurement
• $2.957 million in savings returned to the Crown, and
• $2.043 million to reflect a Cabinet decision relating to the "Canterbury Earthquake Business Support Package" paper, transferring this amount to the non-departmental other expense: Canterbury Earthquake Recovery - Business Support appropriation.

Large Budget Screen Production Fund (M25)#

Scope of Appropriation#

Expenses#

Reasons for Change in Appropriation#

This appropriation has increased by $91.724 million as a result of:

• forecast adjustment of $71.104 million for the Cabinet decision relating to the "Issues Concerning New Zealand as the Possible Location for the Filming of The Hobbit" paper
• $20.037 million to reflect a Cabinet decision relating to the "Warner Brothers Memorandum of Understanding" paper, and
• expense transfer of $583,000 from 2009/10 unspent funds.

Major Events Development Fund (M25)#

Scope of Appropriation#

Expenses#

Reasons for Change in Appropriation#

This appropriation increased by $4.529 million as a result of:

• $6.679 million to reflect a Cabinet decision relating to the "Increasing the Benefit to New Zealand from Major Events" paper, and
• expense transfer of $2.500 million from 2009/10 to reflect the delays in the work relating to the Volunteers Programme - RWC 2011.

This is partially offset by the following decreases of:

• $4 million expense transfer to 2011/12 to reflect the delays in the funding application process for Major Event initiatives, and
• $650,000 transferred to Vote Sport and Recreation to reflect a Cabinet decision relating to the "World Rowing Championships 2010 (Karapiro 2010 Ltd) Loan" paper.

Management Development Fund (M25)#

Scope of Appropriation#

Expenses#

Reasons for Change in Appropriation#

This appropriation decreased by $249,000 as a result of a $600,000 expense transfer to 2011/12 to reflect the delays in the Prime Minister's Business Scholarships programme.

This is partially offset by the following increases:

• expense transfer of $316,000 from 2009/10 to reflect the delays in the PLATO Business Pilot programme, and
• expense transfer of $35,000 from 2009/10 to reflect the delay in funding the Prime Minister's Business Scholarships.

Promotion of New Zealand Associated with the America's Cup (M25)#

Scope of Appropriation#

Expenses#

Reasons for Change in Appropriation#

This appropriation decreased by $16.250 million as a result of an expense transfer of $19.750 million to 2011/12 reflecting the delay in the America's Cup. This is partially offset by an increase of $3.500 million as a result of an expense transfer from 2009/10.

Regional Partnerships and Facilitation (M25)#

Scope of Appropriation#

Expenses#

Reasons for Change in Appropriation#

This appropriation decreased by $4.057 million as a result of:

• $2.157 million funding relating to a Cabinet decision for the "Canterbury Earthquake: Short to Medium Term Business Support Measures" paper
• $1 million funding relating to a Cabinet decision for the "Canterbury Earthquake Business Support Package: Capability Development, Promotions and RWC Support" paper
• $1 million to assist with the Primary Sector Initiatives, Business Opportunities in Australia and Support for export-focused firms, and
• $900,000 transfer to the non-departmental output other expense: Establishment and Operation of Food Innovation New Zealand appropriation, relating to the Cabinet decision for the "Scaled Up Proposal for the Waikato Food Innovation Hub" paper.

These decreases were partially offset by the following increases:

• expense transfer of $800,000 from 2009/10 to reflect the delays in the expansion of the Primary Sector initiatives work, and
• expense transfer of $200,000 from 2009/10 to reflect the delays in the redevelopment of the Project Link website.

Rugby World Cup Leverage and Legacy Programmes (M25)#

Scope of Appropriation and Expenses#

Reasons for Change in Appropriation#

This appropriation increased by $1 million as a result of:

• $250,000 transfer from the non-departmental other expense: International Biotechnology Partnerships appropriation to assist with the Rugby World Cup legacy programme.

Transformational Initiatives Fund (M25)#

Scope of Appropriation and Expenses#

Reasons for Change in Appropriation#

This appropriation reduced by $3.500 million as result of a transfer to the Regional and Industry Development Fund appropriation to assist with the contribution to the "West Coast Economic Support Package" initiative.

Part 6 - Details and Expected Results for Capital Expenditure#

Part 6.1 - Departmental Capital Expenditure#

Ministry of Economic Development - Capital Expenditure PLA (M25)

Scope of Appropriation

Capital Expenditure

Reasons for Change in Appropriation

This appropriation increased by $10.482 million as a result of the following:

• capital expenditure PLA update in 2010/11 OBU for all projects - $3 million
• capital expenditure PLA forecast change in 2010/11 Supplementary's for all projects - $3.982 million
• capital transfer from 2009/10 to reflect the delays in the Emissions Trading Scheme project - $3.500 million, and
• capital transfer from 2009/10 to reflect the delays in the Compass project - $4.500 million.

These increases have been offset by the following decreases:

• transfer of $2 million to 2011/12 to reflect the delays in the Emissions Trading Scheme project
• transfer of $2 million to 2011/12 to reflect the delays in the Compass project, and
• technical adjustment of $500,000 to correct an entry processed in error via the 2010 October Baseline Update for the Compass project.

Part 6.2 - Non-Departmental Capital Expenditure#

Seed Co-investment Fund (M25)#

Scope of Appropriation

Capital Expenditure

Reasons for Change in Appropriation

This appropriation increased by $1.300 million as a result of a $16.988 million capital transfer of 2009/10 unspent funds. This was partially offset by a technical adjustment of $15.688 million to reflect the correct phasing of this fund in this year and in the outyears.

Temporary Rugby World Cup showcase and festival building on Auckland's Queens Wharf (M25)#

Scope of Appropriation#

Capital Expenditure#

Reasons for Change in Appropriation#

This appropriation was established during the 2010/11 year to reflect the Cabinet decision on the "Queens Wharf Development" paper.

Expected Results#

Venture Investment Fund (M25)#

Scope of Appropriation#

Capital Expenditure#

Reasons for Change in Appropriation#

This appropriation has been reactivated as a result of a capital transfer of $66.968 million of 2009/10 unspent funds, which is partially offset by a decrease of $47.618 million as a result of a technical adjustment to reflect the correct phasing of this fund in this year and in the outyears.