Part 3: Performance audits and other work – 2016/17

Annual Plan 2016/17.

Figure 3 provides brief descriptions of the performance audits and other work for 2016/17.

Figure 3
Outline of performance audits and other work for 2016/17

Information theme
1. Sharing information in the border sector

New Zealanders want our border agencies to ensure the efficient movement of people and goods through our border. They also want our border agencies to intercept people and goods that pose a risk to our society and environment.

In the last financial year, the New Zealand Customs Service facilitated 11.8 million passengers through our border, processed over 11 million import and export transactions, intercepted the movement of over 8000 weapons, and intercepted illicit drugs with a street value of over $270 million.

Most trade and travel through our border is legitimate. The border sector agencies need good information and intelligence to continue to facilitate this movement with a "light touch". With the right information, officials can target high-risk people, goods, and craft, and continue to protect our border while increasing the efficiency of lawful movement of people and goods.

In this performance audit, we propose to give some assurance over the effective and efficient use of information and intelligence that assists border officials to protect our border. We also intend to identify where any improvements can be made to help improve New Zealand's security at the border.

We will select an aspect of border operations and assess how well the information and intelligence held by border sector agencies is:
  • shared among agencies; and
  • provided to those who make the key decisions about what is allowed through our border.
2. Digital services and access to information and services

Citizens increasingly expect that information and services will assist them to do things easily and efficiently (for example, using public transport, obtaining a passport or visa, registering a car, or obtaining information about a residential property). More public services are becoming digitally accessible.

We propose to carry out a performance audit looking at whether the shift to digital provision of information and services is resulting in the expected benefits (for example, a better experience for citizens and improving efficiencies). Our audit will examine how the digitalisation of information is enabling and improving access to government information and services for New Zealanders (including those with special requirements, such as the visually impaired) and the effectiveness of the information and service provision.

The particular services we propose to examine are the National Library's digitalisation of records, Quotable Value Limited's home buyers' property information, and real-time travel information at transit points and through smartphone applications.
3. Health patient information systems

The National Health Information Technology (IT) Plan was issued in 2010 with the vision that, by the end of 2014, New Zealanders and the health professionals caring for them would have electronic access to a core set of personal health information. One of the first initiatives was the roll-out of patient portals – online sites where currently 65,000 New Zealanders have access to their patient information and can interact with their GP. By improving patients' access to their information, portals are an important part of the strategic objective to encourage and empower people to be more involved in their health and in decisions about their treatment.

We are interested in understanding how the Ministry of Health has engaged with the health sector in implementing this approach, whether patient portals are working as they are supposed to, and whether they provide safe and secure access to sensitive and personal information.
4. Immigration New Zealand's visa application services

Immigration New Zealand is reaching the final stages of a major change programme. Vision 2015 was designed to improve Immigration New Zealand's effectiveness and efficiency, increase its online services through Immigration Online, and develop a more flexible, responsive, and efficient approach.

We intend to look at how well Immigration New Zealand is managing the visa application process, including through Immigration Online, and whether these changes had a positive effect on customers' experience.
5. Using data to improve public services: the state of leadership, on-the-job learning, investment assessment, and capability development

Worldwide, better use of data is seen as a way to improve the effectiveness and efficiency of public services. We intend to examine how the use of data is being improved in the leadership and development of New Zealand's public services. We will use a mix of methods to evaluate and report on aspects of data leadership and development including:
  • the effectiveness of information functional leadership;
  • how public agencies are learning and collaborating in using data;
  • how public repositories of data are shared and used;
  • what types of data and analysis initiatives (such as social investment) are being identified in departments' four-year plans, and how these are intended to improve the effectiveness and efficiency of public services; and
  • how capability is being built and shared in the public sector.
6. Social housing – how well Housing New Zealand uses information to manage investment, assets and tenancies

Through this performance audit, we propose to examine how well Housing New Zealand uses information to make decisions about tenancy management, asset management, and investment management.

Housing New Zealand is the lead provider of New Zealand's social housing. The housing portfolio that it manages is one of the Crown's largest assets. Pressure has increased on Housing New Zealand to provide and maintain its housing portfolio to ensure appropriately located, well maintained, and fit-for-purpose homes that meet the demand for social housing for people in high need. We will examine Housing New Zealand's ability to do this through the use of information to make well-informed decisions about the management of this important Crown asset to support current and future needs.
7. Infrastructure as a Service: Are the benefits being realised?

Over the last twenty years, information and communications technology (ICT) has made up an increasing part of public entities' balance sheets as the delivery of their services has become more reliant on technology. At the same time, the nature, use, and cost of ICT has rapidly changed. We are interested in how these factors influence how agencies understand and manage their ICT.

Infrastructure as a Service (IaaS) is a vendor-hosted and vendor-managed solution that allows agencies to buy their ICT infrastructure on demand. Buying on demand allows agencies to pay for only what they need when they need it, without the burden of owning and maintaining their own infrastructure.

Adopting IaaS is mandated for a number of central government agencies. We are interested in which agencies have transitioned to purchasing computing IaaS rather than continuing to invest in, own, and manage ICT assets. We are also interested in whether this has achieved the benefits anticipated, and whether the benefits of a system-wide approach are being realised. Given the dynamic environment in which public entities are operating, we intend to examine risk identification and management, both in the transition to IaaS and under the new operating models adopted.
8. Investment to improve the information about local government assets

On a case-study basis, we are proposing to look at how local authorities identify the right information that provides what local authorities need to understand about their assets, and how they collect, capture, and share that information.

We are interested in how well local authorities are managing and planning to provide services now and into the future. This process is important because of the scale and importance of the services local authorities provide and the infrastructure they manage.

Good knowledge about the condition of assets is critical in determining the nature and frequency of maintenance and the timing of renewals. Reliable asset condition information is essential for financial forecasts and asset management plans. It will also inform the 30-year infrastructure strategies that contribute to more robust long-term planning.

In previous reports, we have recommended that local authorities improve the information they hold about assets to help them make good decisions that enable sustainable service delivery.
9. How secure is data in the public sector?

The security of data held by public entities is important to the trust and confidence placed in those entities. We expect public entities to have effective controls over information systems to prevent unauthorised access and loss or corruption of data. During our annual audits of public entities, we typically consider the controls in place over information systems that are important to the financial and performance information we audit. If significant controls are not effective, we communicate the problem to the entity.

Reports to public entities may include control weaknesses identified with data security. We intend to provide a summary of common themes identified around data security. We also plan to provide an overview of:
  • the findings of agencies that monitor public entities' compliance with data security standards; and
  • what those agencies are doing to improve data security.
10. Auckland Council – Review of service performance: Digital re-engineering of customer interfaces

Auckland Council officials have adopted a new three-year organisational strategy. The strategy is expected to enable the Council to achieve its goal to be a high-performing organisation and to position it to meet the challenges that Auckland faces. The strategy is designed to assist the Council to make the necessary links between the Auckland Plan Goals, the commitments made in its long-term plan, and its internal priorities.

Our review of service performance is primarily focused on considering the quality of service delivery to the community. We plan to work with Auckland Council members and officers to select up to three projects identified as priorities for implementation during the first year of the organisational strategy. We intend to review the effectiveness and efficiency of the projects. We will place an emphasis on projects that are related to digital re-engineering of service delivery and procurement processes, and we will also consider projects of a different nature.
11. Overseas Investment Office – how effectively does it collect and manage information relevant to decision-makers?

The Overseas Investment Office (OIO) assesses applications from overseas investors seeking to invest in sensitive New Zealand assets. We have received a request from Parliament to look into the question of how effectively the OIO collects, handles, and uses information that could be relevant to decision-makers. We intend to conduct a performance audit on this question, which will include recent decisions involving the "good character" test.

We would expect to examine:
  • how well the OIO conducts the approvals process (including the principles it applies to assessing applications and the advice it gives about those assessments);
  • the consistency and quality of its decisions (including the quality of the information it uses); and
  • the quality of its monitoring once consent is granted.
Multi-year topics
12. The effectiveness of the Canterbury Earthquake Recovery Authority

We will carry out a review of the role of the Canterbury Earthquake Recovery Authority (CERA) in the recovery of Canterbury following the 2010 and 2011 earthquakes.

CERA was established in March 2011 to lead and co-ordinate the recovery from the Canterbury earthquakes. The establishment of a statutory entity to lead and co-ordinate recovery from natural disaster is common practice internationally. CERA has been disestablished with effect from 18 April 2016, and its various roles and responsibilities have been transferred to other government departments and agencies, including two new entities: Ōtākaro Limited and Regenerate Christchurch.

We will carry out a performance audit to provide an independent review of the performance and cost of CERA, including what has been learnt for managing another such recovery in the future.

This audit will examine:
  • the effectiveness of CERA in performing its various roles;
  • the efficiency of CERA in performing its various roles; and
  • how CERA compared to recovery agencies in other jurisdictions.
13. Education for Māori: Reflections report

We propose to prepare a report that reflects on our previous work on Education for Māori, and answer our overall question:
How well does the education system currently support Māori students to achieve their full potential and contribute to the future prosperity of New Zealand?

The report will pull together the learnings from our previous work on the implementation of Ka Hikitia, relationships between schools and whānau, and using information to improve educational success for Māori. Using the themes described in our 2012 context report to highlight our learnings, the report will describe how well the education sector:
  • implements Māori-student-focused strategies and initiatives;
  • uses resources;
  • works in partnerships;
  • shares good practice; and
  • focuses on monitoring and achieving results.
14. Procurement guidance

We will review and refresh our 2008 guidance in the light of other guidance material and our own procurement audit and inquiry experience since 2008.
15. Procurement: Social services contracting – is it well managed?

We will carry out an audit of how well the Ministry of Social Development (MSD) manages social sector contracts.

MSD purchases about $600 million of services each year from non-governmental organisations (NGOs). Understanding how well this funding is managed is important from both a citizen perspective and a public sector effectiveness perspective. We intend to examine the effectiveness of MSD's procurement and management of third-party contracts for the provision of social services. We will focus on operational and organisational effectiveness in relation to planning, governance, and risk management of MSD's contracts with NGOs.
Other work and analysis
16. Review of the Defence Major Projects Report 2016

Since 2010, the Ministry of Defence and the New Zealand Defence Force have produced the Major Projects Report annually, setting out the status of management of major defence acquisitions. The Auditor-General has reviewed these reports to provide independent assurance about the information that they are based on. In 2016/17, we will review the Major Projects Report 2016.
17. Governance to support the national security system in achieving national security objectives

The Department of the Prime Minister and Cabinet has a strategic objective to ensure that: National security priorities, the civil defence emergency management system and the intelligence system are well led, coordinated and managed.

In its 2014/15 Annual Report, the Department says that, by pursuing this objective, it expects that it will contribute to the following:
  • New Zealand has world-class processes in place to identify and deal with national security events and emergencies and to build national resilience; and
  • the New Zealand Intelligence Community is viewed as trusted, integrated, customer oriented and crucial to building national resilience.
We intend to undertake a performance audit to examine whether governance arrangements for the national security system are effective in enabling achievement of the objectives identified above.
18. Review of the Treasury's Statement on New Zealand's long-term fiscal position

Every four years, the Treasury is required to produce New Zealand's long-term fiscal statement. The long-term fiscal statement provides projections of New Zealand's long-term fiscal position (covering a period of at least 40 years), and identifies and analyses a range of options to address the long-term fiscal position, but, importantly, does not make recommendations.

There have been three long-term fiscal statements produced to date ‒ in 2006, 2009, and 2013. The next long-term fiscal statement is planned for 2016.

As we did in 2013, we intend to review New Zealand's 2016 Long-term Fiscal Statement produced by the Treasury. We are interested in understanding and commenting on:
  • the approach that the Treasury takes;
  • the Treasury's long-term fiscal model and how it is used; and
  • the links between the long-term fiscal model and the information presented in the long-term fiscal statement.
19. Next steps in performance reporting

For more than 25 years, there have been statutory requirements for a range of public entities to report on their service performance. We have long been active in promoting improvements in how public entities fulfil these requirements, and we have seen improvements.

We have seen some evidence of stronger performance frameworks that bodes well for improved reporting in the future.

However, there is still a fair way to go, particularly in reporting that enables users to understand an entity's longer-term strategic objectives and how well it has performed against them.

We intend to reflect on the next steps in performance reporting that will further enhance the accountability of public entities.