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Output Class > Policy Advice > Business and Competition

Description

This output class provides advice on the effective and low-cost regulation of economic activity. It includes strategic and technical policy advice on the creation and maintenance of a regulatory environment that provides greater certainty for, and positively encourages, business innovation and growth.

Quantity, Quality, Timeliness and Cost

Work Programme

All policy advice projects were delivered in accordance with the terms of the work programme as agreed with the Minister. Changes to deadlines were negotiated with the Minister.

The following outputs were included in this output class for 2004/2005.

Business Environment, Business Law and Competition Policy

This output provides policy advice on corporate and commercial law, including capital markets, insolvency, intellectual property law and competition law and policy. In 2004/2005 the output included the following.

Business Facilitation Policy

This output provides policy advice on enhancing the effectiveness of, and reducing the costs to business from, compliance with laws and regulations, and standards and conformance issues. In 2004/2005 the output included the following.

Trade Policy and Rules

This output provides policy advice on New Zealand's tariff, trade remedies, and government procurement positions to support industry competitiveness. The output also includes policy advice on international regulatory frameworks that support the interests of New Zealand exporters and reduce costs to firms. In 2004/2005 the output included the following.

Building Industry Regulatory Policy

The Ministry progressed a wide-ranging reform of the regulatory regime for building controls to an advanced stage. The Building Act 2004 was passed on 20 August 2004. Responsibility for this output, along with the administration of licensed building practitioners, was transferred to the Department of Building and Housing on 1 November 2004.

Environmental Policy

This output provides policy advice on the impact of environmental and conservation measures on economic development, with a particular focus on the Resource Management Act 1991 (RMA) and the Hazardous Substances and New Organisms Act 1996 (HSNO), climate change, and multilateral environmental agreements that directly impact New Zealand businesses. In 2004/2005 the output included the following.

Providing advice (in conjunction with the Ministry for the Environment and other interested parties) on a strategy to improve the RMA, particularly proposals to improve consent decision-making, ensuring that economic development aspects are represented along with other interests.

The Ministry of Economic Development, in conjunction with the Ministry for the Environment and other interested parties, supported the passage of the Resource Management and Electricity Law Amendment to implement proposals to improve the RMA.

Providing advice (in conjunction with the Ministry for the Environment and other interested parties) on measures to improve the operation of the HSNO for business.

The Ministry of Economic Development has developed and initiated a three-year research programme to improve understanding of the impacts of the RMA and the HSNO on business.

Crown Entity/Statutory Board Monitoring

Monitoring and reporting on the financial and/or non-financial performance of seven Crown entities and eight other boards was provided to the Minister. This included advice on role and functions, appointments, and on the overall contribution of each organisation to the Government's policy objectives. As appropriate to each organisation, these were reflected through:

• the Statement of Intent;
• the Memorandum of Understanding or Purchase/Output Agreement;
• management reports (for reference, as appropriate, to the Minister);
• meetings and reports to the Minister; and
• the Annual Report.

In 2004/2005, a total of 42 appointments were made, within agreed timelines, to Crown entity and statutory boards, as positions for renewal or appointment fell due.

Advice was provided on, and appointments made to, the following organisations:

On 1 November 2004, the Building Industry Authority functions were transferred to the Department of Building and Housing.

The responsibility for monitoring of, and appointments to, the Architects Investigations Committee, the Architects Education and Registration Board, the Chartered Professional Engineers Council and the Engineering Associates Registration Board were transferred to the Department of Building and Housing, effective from 1 November 2004.

The responsibility for the monitoring of, and appointments to, the Charities Commission was transferred to the Department of Internal Affairs, effective from 1 July 2005.

Cost

(Figures are GST exclusive)

Major Budget Variances

The Supplementary Estimates increase mainly reflected funding for travel costs in support of WTO negotiations and bilateral CEP/FTAs ($446,000), additional funding associated with International Connectedness, Single Economic Market and associated business law needs ($332,000), funding to establish a steering group on the regulation of financial intermediaries ($307,000), a transfer from 2003/2004 for the establishment of the Charities Commission ($250,000), additional funding to fully fund the Charities Commission establishment costs ($231,000), a transfer from 2003/2004 for the completion of the Synthesis Report on Compliance Costs Pressures ($58,000) and a transfer from Administration of Trade Remedies to meet cost pressures ($50,000), partially offset by the transfer of building policy functions to Vote: Housing (-$944,000) and a transfer from 2004/2005 to 2005/2006 for research into possible negotiation of an FTA with the USA (-$67,000).

The variance between 2004/2005 and 2003/2004 for actual expenses mainly reflects the changes referred to above.

Output Class > Administration of Part II Tariff Concessions

Description

This output class provides for the administration of tariff concessions, as required under section 8 of the Tariff Act 1988, through the timely assessment of applications by importers for exemption from import duties as defined by the tariff concessions policy.

Quantity, Quality, Timeliness and Cost

(Performance standards are in brackets where applicable.)

Quantity

Applications by Importers:

• 509 (485) applications were lodged.

Quality

Processes complied with the standards contained in current Ministerial delegations and the policies contained in the Tariff Concessions Guidance Manual with no decisions reversed on appeal.

Timeliness

99% (90%) of initial decisions to advertise or decline an application were made within five working days of receipt.

94% (90%) of final decisions on applications were made within 10 working days of the end of the advertising period.

Cost

(Figures are GST exclusive)

Revenue Other was derived from concession administration fees.

Major Budget Variances

The variance between the Supplementary Estimates and actual revenue reflects declining revenue from concession application fees from importers for exemption from import duty.

Output Class > Administration of Trade Remedies

Description

This output class provides investigative services to establish whether New Zealand industries require remedies to prevent injury caused by dumped or subsidised imports or sudden import surges.

The investigative service is conducted under the Temporary Safeguard Authorities Act 1987 and the Dumping and Countervailing Duties Act 1988 in relation to dumped and subsidised goods.

Quantity, Quality, Timeliness and Cost

(Performance standards and forecast volumes are in brackets where applicable.)

Quantity

An estimated ten product-by-country investigations, reviews and reassessments, resulting from applications from New Zealand industries, will be under action during 2004/2005.

Five product-by-country dumping investigations, resulting from applications from New Zealand industries, were conducted during the year.

Fewer applications than expected were received from New Zealand industries.

Quality

Investigations and reporting are to be recognised by the parties involved as consistent with the requirements of either the Temporary Safeguard Authorities Act 1987 or the Dumping and Countervailing Duties Act 1988, provide no grounds for review under judicial review proceedings (no successful court challenges), and provide no grounds for World Trade Organisation dispute settlement proceedings (no successful dispute settlement action against New Zealand).

No court proceedings were initiated.

Timeliness

All (all) interested parties were advised of essential facts and conclusions on which a final determination was based, no later than 150 days from initiation.

All (all) final determinations were made no later than 180 days from initiation of an investigation.

Cost

(Figures are GST exclusive)

Major Budget Variances

The Supplementary Estimates change mainly reflected a transfer to Policy Advice - Business and Competition to meet cost pressures (-$50,000).

Output Class > Registration and Granting of Intellectual Property Rights

Description

This output class provides services relating to the administration of legislation providing for the protection of intellectual property rights in New Zealand by granting patents under the Patents Act 1953, registering trade marks under the Trade Marks Act 2002, registering designs under the Designs Act 1953, granting plant variety rights under the Plant Variety Rights Act 1987, providing registers of information relating to intellectual property, conducting hearings, and acting as a Receiving Office for the World Intellectual Property Organisation.

Quantity, Quality, Timeliness and Cost

(Performance standards and forecast volumes are in brackets where applicable.)

Quantity

Numbers of new applications:

• 5,585 (5,300) patents;
• 27,937 (23,200) trade marks;
• 1,321 (1,200) designs; and
• 148 (155) plant variety rights.

Numbers of renewals:

• 9,134 (9,300) patents;
• 10,014 (10,700) trade marks;
• 775 (730) designs; and
• 1,151 (940) plant variety rights.

All volumes are demand driven. Increased demand for both trade mark and design protection from clients (both domestic and foreign) is consistent with overseas trends.

Quality

All decisions to grant/register intellectual property rights were published in the Patent Office Journal monthly and were available for public scrutiny. No more than 2% (no more than 2%) intellectual property rights published required subsequent republication due to an error in the original notice.⁴

Timeliness

100% (98%) of completed applications⁵ were receipted, acknowledged and a filing date confirmed within one clear business day of receipt.

99% (96%) of applicants were notified of the decision to grant or refuse plant variety rights within four months of completion of testing.

Cost

(Figures are GST exclusive)

Major Budget Variances

The Supplementary Estimates change mainly reflected the marginal cost increases associated with processing an increase in the volumes of trade mark applications and the associated GST impact.

The variance between the Supplementary Estimates and actual Revenue Other has been largely due to trade mark application volumes being 20% higher than expected (27,937 actual applications versus 23,200 forecast applications). This trend is consistent with that being observed overseas.

The variance between the 2004/2005 and 2003/2004 for actual expenses mainly reflects the marginal cost increases associated with processing the increased volumes.

Output Class > Administration of Insolvencies

Description

This output class provides services relating to the administration of bankruptcies and liquidations by the Official Assignee pursuant to the Insolvency Act 1967 and the Companies Act 1993, and the management or disposal of property restrained or forfeited under the Proceeds of Crime Act 1991, and provides enforcement functions under the Insolvency Act 1967.

Quantity, Quality, Timeliness and Cost

(Performance standards and forecast volumes are in brackets where applicable.)

Quantity

Numbers administered:

• 2,995 (2,700) bankruptcies;
• 134 (200) liquidations; and
• 30 (15) proceeds of crime orders.

There has been an increasing trend in the number of bankruptcies over the year.

The number of liquidations administered is lower than forecast, due to an increased number of liquidations being administered by private liquidators.

The increase in proceeds of crime orders is indicative of greater recourse to this legislation by the police.

Quality

In 99% (90%) of instances, a progress report to creditors on the financial position and likelihood of a dividend was provided within 25 clear business days of adjudication or date of liquidation.

All (all) progress reports to creditors were reviewed and signed off against the New Zealand Insolvency and Trustee Service Best Practice Standard prior to dispatch.

Timeliness

To achieve a maximum percentage of case closures as measured against total cases received in the following categories:

Bankruptcies

The percentages of bankruptcy files closed were:

• 94% (80%) or more of bankruptcy files were closed within one year;
• 97% (90%) or more of bankruptcy files were closed within two years; and
• 99% (95%) or more of bankruptcy files were closed within three years.

Targets were exceeded due to improvements/streamlining of processes and systems.

Liquidations

The percentages of liquidation files closed were:

• 68% (60%) or more of liquidation files were closed within one year;
• 88% (85%) or more of liquidation files were closed within two years; and
• 97% (95%) or more of liquidation files were closed within three years.

Targets were exceeded due to improvements/streamlining of processes and systems.

Cost

(Figures are GST exclusive)

Major Budget Variances

The variance between the Supplementary Estimates and Actual Revenue Other arises from the Official Assignee managing fewer company liquidations and greater numbers of bankruptcies with insufficient assets, which have resulted in lower than forecast commissions being received in 2004/2005.

The variance between 2004/2005 and 2003/2004 for actual Revenue Other reflects the circumstances outlined above.

Output Class > Registration and Provision of Statutory Information

Description

This output class provides services relating to the registration and provision of a range of documents and information required to be filed on a public record by corporate entities, insurance and superannuation funds, issuers of securities and holders of securities over personal property interests, and the provision of information services related to the same. It also provides a prosecution and enforcement function under the Companies Act 1993, Securities Act 1978 and Corporations (Investigation and Management Act) 1989.

Quantity, Quality, Timeliness and Cost

(Performance standards and forecast volumes are in brackets where applicable.)

Quantity

Companies Office

Numbers of material documents filed:

• 63,266 (63,100) company incorporations of which 98% (95%) were electronic;
• 91,551 (92,000) name approvals of which 98% (96%) were electronic;
• 451 (1,000) prospectuses;
• 323,197 (326,100) annual returns of which 96% (75%) were electronic; and
• 577,282 (520,300) personal property security interest registrations.

All volumes are demand driven.

The reduction in the number of prospectuses is due to a change in legislation. (The forecast number was reduced to 700 in the 2005/2006 Statement of Forecast Performance.)

The high uptake of electronic filing of company annual returns is due to ease of access and the removal of the online filing fee.

While Personal Property Securities Register (PPSR) registrations were 11% higher than forecast, the PPSR register is a relatively new register and volume trends have yet to establish a meaningful pattern.

Electronic searches conducted:

• 661,589 (553,400) electronic company searches; and
• 2,430,492 (1,460,800) PPSR electronic searches.

The higher than forecast numbers of electronic company searches (19.5%) and PPSR searches (66%) reflects the ease of access and increasing public awareness of these registers.

Other services:

• 24,224 (29,000) company dissolutions were actioned.

Higher levels of business activity and strong economic conditions have meant fewer companies have ceased operation.

Insurance and Superannuation Unit

• 615 (680) Trustee Annual Reports were filed; and
• 22 (14) new scheme registrations were actioned.

The number of superannuation schemes wound up during the year was higher than expected.

A larger number of new one-person schemes was registered than expected.

Quality

Companies Office

100% (99%) of documents entered into the database were free of material errors, as defined in the Companies Office Standards,⁶ for both electronic and manual information.

100% (99%) of images entered into the database were to the required standard to ensure clarity, accuracy and completeness of the data captured.

Timeliness

100% (99%) of material documents⁷ were processed within one clear business day of receipt for paper documents and within 45 minutes of receipt for documents filed electronically.

Cost

(Figures are GST exclusive)

Major Budget Variances

The Supplementary Estimates increase in expenditure mainly reflected marginal cost increases associated with processing an increase in transaction volumes and the associated GST impact ($624,000), partially offset by a rephasing of costs to operate a register of retirement villages (-$43,000).

The variance between 2004/2005 and 2003/2004 for Revenue Other is the impact of a 10-year fee-setting strategy implemented on 1 July 2004 that is intended to reduce the surplus in the Memorandum Account.

The variance between the 2004/2005 and 2003/2004 for actual expenses mainly reflects the marginal cost increases associated with processing an increase in volumes.

Output Class > Administration of Licensed Building Practitioners

This output class provides for the design, establishment and maintenance of the licensed building practitioner's regime under the proposed Building Bill.

Quantity, Quality, Timeliness and Cost

Work Programme

All policy advice projects were delivered in accordance with the terms of the work programme as agreed with the Minister. Changes to deadlines were negotiated with the Minister.

This was the first year of operation for this output class. In 2004/2005, outputs to be delivered included:

• developing and implementing a communications strategy for builders and designers on the new licensing regime;
• developing user requirements for a national register of builders and designers;
• developing associated regulations; and
• appointment of a Building Practitioners Licensing Board.

The projects and related appropriation in this output class were transferred to the Department of Building and Housing on 1 November 2004.

Cost

(Figures are GST exclusive)

Major Budget Variances

The Supplementary Estimates decrease reflects the transfer of building policy functions to Vote: Housing.

No revenue is associated with the expenditure appropriation that was included in the forecast of Memorandum Account Balances for the period ending 30 June 2005 in the 2004-2007 Statement of Intent. In the longer term, revenue will be received by the administering department to effectively operate on a full cost recovery basis.

This is the first year this activity was undertaken.