Foreword

New Zealand’s Official Development Assistance funding programme is one of the main ways the Government contributes to reducing poverty in developing countries. The New Zealand Agency for International Development (NZAID) administers the programme. NZAID often works in politically sensitive and geographically remote locations in the Pacific and South-East Asia. NZAID’s work in these areas is valued by its development partners and other international aid agencies.

My staff carried out a performance audit to examine the effectiveness of NZAID’s management of overseas aid programmes. The audit focused on how NZAID planned, implemented, monitored, and evaluated its overseas aid programmes. It specifically looked at how NZAID managed three programmes - the Papua New Guinea bilateral programme, the Indonesia bilateral programme, and the Pacific Regional Health programme.

NZAID has a long-term approach to planning and works closely with its development partners and other international aid agencies in setting up its programmes. It monitors performance and evaluates the effectiveness of its programmes, to varying degrees. However, more clarity, consistency, and direction are needed.

A lack of comprehensive, clear, and accessible processes and procedures for putting in place and monitoring funding arrangements for delivering aid programmes was an area of particular concern during the audit. Although NZAID has recently introduced new processes and procedures, it will need to train all relevant staff and regularly monitor and review compliance to ensure that these new processes and procedures are effectively implemented. This issue will be monitored as part of the annual financial audit process.

I thank the many staff in NZAID, development partner organisations, other international aid agencies, and the overseas governments that they work with for their co-operation during the audit.

K B Brady
Controller and Auditor-General

16 January 2008