Appendix 1: Our proposed performance audit work programme
Proposed performance audits and studies in 2007/08
The Auditor-General proposes to conduct the following performance audits and studies in 2007/08. For context, we also provide a list of work due to be completed and work about to start in the remainder of 2006/07.
The proposed performance audits and studies marked with an asterisk (*) have not previously been described in our annual plans, and are described in more detail on the following pages.
The actual work programme we deliver in 2007/08 may differ from this proposal. Our proposed annual work programme is necessarily determined many months in advance of the year to which it relates. As time elapses, we may need to alter our priorities. For example, other urgent work such as an inquiry may intervene, or government policy or the circumstances of a particular entity may change so that a particular audit is no longer relevant. The reports for some audits that will commence in 2007/08 may not be presented to the House of Representatives until 2008/09.
|
Proposed performance audits and studies for 2007/08
|
|---|
| *Accident Compensation Corporation – effectiveness of implementation of the Falls Prevention Strategy |
| *Guidelines on audit committees in the public sector |
| *Civil Aviation Authority (and Ministry of Transport) – follow-up on response to 2005 audit |
| *Guardians of New Zealand Superannuation – governance, management, and administration of the New Zealand Superannuation Fund |
| *Health sector – management of funding to non-government organisations by the Ministry of Health |
| *Health sector – management of funding to non-government organisations by District Health Boards |
| *Housing New Zealand Corporation – maintenance of state housing |
| *Inland Revenue Department – effectiveness of the Industry Partnerships Programme |
| *Local government – asset management planning |
| *Local government – regulatory practice – liquor licensing |
| *Local government – water services assessments |
| Ministry of Defence – major acquisition projects |
| *Ministry of Education – effectiveness of teacher professional development services |
| *Ministry of Education – monitoring and support of school Boards of Trustees |
| *Ministry of Health – monitoring the implementation of the Primary Health Care Strategy |
| *Ministry of Health and Department of Corrections – prisoner mental health treatment |
| Ministry of Social Development – benefit fraud |
| New Zealand Aid – Official Development Assistance |
| *New Zealand Trade and Enterprise – follow-up to 2004 audit of administration of grant programmes |
| *ONTRACK (New Zealand Railways Corporation) – systems, policies, and procedures for maintaining and renewing rail infrastructure |
| Procurement guidelines update |
| Revitalisation of Te Reo Māori |
| *Work and Income – effectiveness of case management of sickness and invalid beneficiaries |
| Performance audits and studies due to be completed by 30 June 2007 |
|---|
| Collaboration in roading |
| Department of Corrections – management of Resource Management Act consultation processes |
| Department of Labour – management of immigration identity fraud |
| “Get checked” – a programme to better manage diabetes |
| *Guidelines on managing conflicts of interest |
| Local government – waste management plans |
| Local government – guidelines on decision-making and consultation |
| *Statements of corporate intent |
| Performance of the New Zealand Customs Service in collecting revenue |
| New Zealand Debt Management Office – management and administration |
| New Zealand Qualifications Authority – quality assurance of education provided by polytechnics |
| Sustainable development – implementation of the Programme of Action |
| Te Puni Kōkiri – administration of grant programmes |
Proposed performance audits and studies not previously described in our annual plans
The following paragraphs provide more information about our proposed performance audits and studies that have not previously been described in our annual plans.
Accident Compensation Corporation – effectiveness of implementation of the Falls Prevention Strategy
Falls are the single largest cause of injuries requiring hospital admission. In June 2005, Cabinet approved a strategy, to be led and implemented by the Accident Compensation Corporation, that is intended to reduce the number of injuries from falls. The proposed audit would examine the effectiveness of the implementation of the strategy. The audit would also report on the lessons that can be learned from implementing a sector-wide strategy that requires effective leadership of a wide range of government, private, and volunteer organisations.
Guidelines on audit committees in the public sector
We propose a publication in the nature of a “good practice guide” that will cover matters such as the role of an audit committee, its membership, and the scope of its work.
Civil Aviation Authority (and Ministry of Transport) – follow-up on response to 2005 audit
We intend to conduct an audit of the Civil Aviation Authority (CAA) to follow up on its response to the recommendations made in our 2005 audit of the CAA’s certification and surveillance functions. We have agreed to a request from the Minister of Transport to examine, as part of this audit, the CAA’s and Ministry of Transport’s responses to the recommendations made by the Christchurch Coroner in relation to the 2003 Air Adventures crash.
Guardians of New Zealand Superannuation – governance, management, and administration of the New Zealand Superannuation Fund
The New Zealand Superannuation Fund (the Fund) was established to partially provide for the future cost of New Zealand Superannuation. The Fund is governed by a Crown entity, the Guardians of New Zealand Superannuation, which is expected to invest the Fund in a prudent and commercial manner, without undue risk, and in a manner that avoids prejudice to New Zealand’s reputation. The management of the Fund appoints external firms to undertake day-to-day portfolio management.
The Government plans to allocate around $2 billion a year for the Fund to invest. The Fund held assets of $10.7 billion at 30 September 2006, and is expected to hold assets of $120 billion by 2025. The Fund is a major public investment, and is therefore a high priority for a performance audit.
Our audit will provide assurance to Parliament as to whether the New Zealand Superannuation Fund is being prudently managed. It will cover those elements of the Fund’s activities that are critical to assurance about its overall management. These may include governance, development, and implementation of the Fund’s investment strategy; appointment and monitoring of external fund managers; and the planning and systems that support management of the Fund.
Health sector – management of funding to non-government organisations
Our Annual Plan 2006/07 stated that, in 2007/08, we would start a programme of auditing selected agencies’ management of public funding to non-government organisations. This follows on from our good practice guide Principles to underpin management by public entities of funding to non-government organisations, published in June 2006. The audits for the health sector are:
- the management of funding to non-government organisations by the Ministry of Health; and
- the management of funding to non-government organisations by District Health Boards.
Housing New Zealand Corporation – maintenance of state housing
Housing New Zealand Corporation manages more than 66,000 properties nationwide with a value of more than $11.3 billion. Effective maintenance of the state housing portfolio is important because it protects the value of a significant national asset and has flow-on effects for the health and well-being of state housing tenants.
Our performance audit will provide assurance to Parliament on the management of Housing New Zealand Corporation’s state housing maintenance programme. The audit is likely to consider overall planning for the maintenance programme, contract management, and performance monitoring and reporting of the maintenance function.
Inland Revenue Department – effectiveness of the Industry Partnerships Programme
The Inland Revenue Department’s Industry Partnerships Programme involves building relationships with, and providing educative material to, industries where there is the potential for relatively high levels of cash to be obtained through legal trading activities that is under-declared for income tax purposes. A performance audit is proposed to assess the effectiveness of the Inland Revenue Department’s design, implementation, monitoring, and management of the programme.
Local government – asset management planning
The Office has consistently encouraged sound asset management planning in local government. Our recent audits of Long-Term Council Community Plans indicated a need for better asset management planning in the sector, and stronger linkages to levels of service and financial forecasting. In many local authorities, limited capacity presents a challenge to comprehensive asset planning. The proposed audit would examine the approaches taken by selected local authorities, describe good practices as models for other authorities to follow, and reinforce best practice principles.
Local government – regulatory practice – liquor licensing
The Sale of Liquor Act 1989 requires local authorities to carry out statutory liquor licensing responsibilities within their districts. The Act is designed to establish a reasonable system of control over the sale and supply of liquor to the public, with the aim of contributing to the reduction of liquor abuse. This requires local authorities to consider various sets of commercial and community interests in exercising their statutory powers under the Act, and in giving effect to their associated policies. The audit would examine how local authorities are discharging these liquor licensing responsibilities.
Local government – water services assessments
The Local Government Act 2002 requires local authorities to undertake water services assessments from time to time. The assessments relate to key infrastructure asset systems maintained by local government, and must cover water supply, wastewater, and stormwater. Management of these services is critical to the quality of life of individual local communities, and the primary purpose of the assessments is to safeguard public health. The assessments are a mechanism for local authorities to identify demand and risks for water services, which can then be incorporated into future service and asset planning to ensure that public health is maintained.
We propose a performance audit to examine water services assessments and how the assessments are integrated into planning by local authorities.
Ministry of Education – effectiveness of teacher professional development services
The Ministry of Education is responsible for funding teacher professional development services from third-party providers. There is a risk that this funding does not reach those teachers most in need of professional development, or the subject/topic areas or locations where professional development is most needed.
We propose a performance audit to examine the effectiveness of the Ministry of Education’s prioritisation and provision of post-training teacher professional development services. The audit will not examine the effectiveness of individual professional development support services.
Ministry of Education – monitoring and support of school Boards of Trustees
The schools portfolio comprises about 2450 schools, each a separate Crown entity governed by a Board of Trustees elected from the community. This system of school governance is one of the most devolved in the Organisation for Economic Co-operation and Development. A Board of Trustees is responsible for governing its school; however, the Ministry of Education is responsible for monitoring school and Board effectiveness. As part of this role, the Ministry provides and facilitates support and training for Boards and trustees. The Ministry’s Schooling Strategy 2005-10 states that:
…schools will continue to be self-managing, but there are times when schools need additional support. For this reason, it is important to have review and monitoring systems so that schools with difficulties can be identified early on. Any resulting interventions will then focus on what is needed to address the situation.
The Ministry uses information from a variety of sources in its monitoring. It also has a variety of possible interventions, ranging from providing advice to (in extreme cases) removing the Board. There are risks that the Ministry is not gathering sufficient information, is not using the information gathered to identify Boards at risk in a timely manner, and is not implementing appropriate and timely interventions to support Boards.
We propose a performance audit to examine the systems used by the Ministry of Education to ensure that there is effective monitoring and support of school Boards of Trustees. We propose to assess the level of training and other support available to trustees as part of our audit.
Ministry of Health – monitoring the implementation of the Primary Health Care Strategy
The Primary Health Care Strategy’s objectives are to reduce health status inequalities and improve health. The Strategy is principally being implemented through Primary Health Organisations. Since 2001, the Government has provided more than $2 billion to improve patient access to primary care and to improve services. The Ministry of Health is responsible for ensuring that the Strategy is implemented and seeing that its objectives are being achieved. Our performance audit will assess the Ministry’s performance in these areas.
Ministry of Health and Department of Corrections – prisoner mental health treatment
There is evidence that the prevalence of mental illness among the prison population is disproportionately higher than that of the general population. There is therefore a significant need for mental health services in prison. The Department of Corrections and the Ministry of Health have undertaken to provide health services to prison inmates at the same level available to the general population. Both agencies have identified the provision of mental health services to prisoners as a problem area. The extent to which prisoners’ mental health needs are being met is unclear.
We propose an audit focusing on the provision of mental health services to prisoners. It will examine the roles and responsibilities of the justice and health sectors in mental health service delivery to prisoners. In particular, this will include how prisoners’ mental health needs are identified, and how these needs are being met.
New Zealand Trade and Enterprise – follow-up to 2004 audit of administration of grant programmes
We intend to conduct an audit to follow up on our 2004 audit of NZTE’s administration of grant programmes. Since our report on that audit, NZTE has undertaken an extensive business process improvement programme to address the concerns we raised in our report. We will examine the changes that have been made, and assess the appropriateness of NZTE’s current administration of grant programmes.
ONTRACK – systems, policies, and procedures for maintaining and renewing rail infrastructure
ONTRACK (the trading name of the New Zealand Railways Corporation) took responsibility on behalf of the Crown for the ownership and maintenance of the national rail infrastructure after the Crown’s repurchase of the network in 2004.
We are interested in rail as an area of major asset management. The audit will examine ONTRACK’s systems, policies, and procedures for maintaining and renewing the rail network.
Work and Income – effectiveness of case management of sickness and invalid beneficiaries
Sickness and invalid beneficiaries are a significant benefit client group, in terms of both numbers and government expenditure. The Ministry has a strategy to provide more active support to these beneficiaries in achieving independence and finding employment. Options for the audit include examining the application of eligibility criteria, examining the case management of beneficiaries, or an assessment of the outcomes of the strategy. We will further consider these options with a view to focusing our audit to best effect.
Guidelines on managing conflicts of interest
We wish to improve awareness and understanding in the public sector of the nature of conflicts of interest and how best to deal with them. We have provided advice on managing conflicts of interest in the public sector in a range of inquiry and other reports. We now intend to build on our previous work, and publish guidance in a more general and accessible form.
Statements of corporate intent
Our 1998 article Statements of Corporate Intent: Are They Working? set out our expectations of Statements of Corporate Intent (SCIs), including recommending changes to some legislation governing SCIs. The article also reviewed, and found variable compliance with, the requirements for SCIs. We propose an update of our 1998 article. The report will review our expectations and the statutory requirements of the SCI model. It will also review compliance with legislation about SCIs by port companies, energy companies, council-controlled organisations (including council-controlled trading organisations), State-owned enterprises, and Crown research institutes.
page top