Achieving Our Outcomes
This section describes the outcomes and goals we must achieve and the types of output we will deliver in order to achieve them. The process of developing our outcome framework involved significant review and analysis of the challenges confronting government in respect of micro-economic regulation, as well as broader issues such as the economic participation of Māori. This analysis has not been presented in detail in the Statement of Intent, although a brief rationale has been provided for each of the supporting goals described under our outcomes.
Foundation Outcome: The Regulation of Economic Activity Is Effective and Low Cost
To achieve this outcome, the Ministry will focus on the following supporting goals:
1. Transaction Costs are Minimised for Consumers and Businesses in Domestic and International Markets
Unnecessary costs can reduce the competitiveness of our businesses and impose an unfair burden on consumers. In some cases government needs to regulate to keep transaction costs to business down - for example, where access to information would be very costly in the absence of such regulation. On the other hand, government regulation can itself impose costs upon business, whether the regulations are there for economic, social or environmental purposes. Some regulatory costs are inevitable and unavoidable. But the Ministry is working to reduce the cost of regulation to business, and to balance those costs that cannot be avoided against the benefits to the wider community and economy.
Other examples of activities that contribute to this goal are:
- implementing the Government's responses to the Ministerial Panel on business compliance costs;
- work undertaken under the business law reform programme; and
- ensuring that consumer laws and regulations require businesses to provide accurate information to consumers.
For further details of the outputs under the contributing Votes: Commerce, Communications, Consumer Affairs, and Energy refer to the Output Class Specific Performance Measures in Part B.
2. Markets, Businesses and Consumers Have Access to and Use Information Held by the Ministry That Enables Them to Conduct Business Effectively
Information on businesses and markets is necessary to create confidence in those markets, to ensure that participants can make good investment decisions, and to minimise undesirable conduct such as fraud. The Ministry advises on the law that creates obligations on market participants to disclose information. We also manage a range of databases and provide information on a variety of different topics to assist people to make well-informed decisions. We are increasing our use of technology to place much of this information on the internet, thus improving access and reducing the costs of that access.
Examples of activities that contribute to this goal are:
- developing and maintaining effective regulation of capital markets, including reform projects on insider trading and market manipulation;
- the work of the E-Commerce Action Team (ECAT) and promoting the establishment of regional and industry based ECATs;
- making publicly available comprehensive information on energy demand and supply scenarios that assist market participants to make investment and consumption decisions;
- completing online accessibility to all services provided by the business registries;
- ensuring consumers have accurate information about products and services, including how to use them safely; and
- administering gas and electricity information disclosure regulations.
For further details of the outputs under the contributing Votes: Commerce, Consumer Affairs, and Energy refer to the Output Class Specific Performance Measures in Part B.
3. New Zealand's International Connections Enhance and Increase Business Opportunity
International connections are important for a small country like New Zealand because they open up opportunities for investment and business growth. Our relationship with Australia, for example, enables free trade in goods and services, and the free flow of investment, skills and labour. We also need to participate in international institutions such as the WTO that establish the rules governing international business and trade, because an increasing number of the regulations applying in New Zealand are based on norms or rules that are developed in these institutions or in the jurisdictions of our major trading partners.
The Ministry is providing an effective voice in the international institutions that establish regulatory frameworks in order to protect and promote New Zealand's interests. Our participation also provides an opportunity to showcase New Zealand as an attractive country in which to invest, and exposes local business people and policy makers to international thinking and best practice.
Other examples of activities that contribute to this goal are:
- close involvement in the Doha round of World Trade Organisation negotiations;
- close involvement in negotiating Closer Economic Partnerships with key trading partners, as required by the Government;
- advising on climate change matters from an economic development perspective;
- implementing the work programme for closer co-ordination of business law with Australia; and
- implementing and, in 2003, reviewing the Trans-Tasman Mutual Recognition Agreement.
For further details of the outputs under the contributing Votes: Commerce, Communications, Consumer Affairs, Energy and Tourism refer to the Output Class Specific Performance Measures in Part B.
4. Anti-Competitive Behaviour, Abuse of Market Power and Barriers to Market Entry Are All Minimised
Businesses can start and thrive, and consumers get a fair deal, when anti-competitive behaviour is restricted and firms compete fairly for business under transparent rules. The Ministry works to ensure that markets are regulated fairly and effectively, and that the competitive process is protected.
Examples of activities that contribute to this goal are:
- advising on electricity industry self-regulation and delivery of outcomes and objectives in the Government Policy Statement on Electricity;
- advising on effective regulation of the gas market and implementing legislation/regulation as required from 2003 onwards;
- reporting on comparative performance of the New Zealand telecommunications regime in respect of prices and the uptake of key new telecommunications services;
- on-going scrutiny of the operation of the Commerce Act 1986, and revision if required; and
- contributing to the developing international agenda for competition law and policy in the OECD, WTO and elsewhere.
For further details of the outputs under the contributing Votes: Commerce, Communications, Consumer Affairs and Energy refer to the Output Class Specific Performance Measures in Part B.
5. Regulation Promotes Accountability and Responsibility in Business Practice
Businesses, their managers and directors need to be accountable to their stakeholders. Regulation both prescribes this accountability and ensures that shareholders have the information they need to hold managers accountable. The Ministry advises on the rules that establish accountability and promote responsibility, and the institutions and powers required to ensure effective monitoring and enforcement of these rules
Examples of activities that contribute to this goal are:
- supporting enactment of the Securities Markets and Institutions Bill, which strengthens the enforcement of securities law and establishes a co-regulatory regime for capital markets;
- administering compliance and enforcement requirements, including those under the Companies and Insolvency Acts; and
- providing policy advice on the business law reform programme, including insider trading laws and the regulation of life insurance markets.
For further details of the outputs under the contributing Vote: Commerce refer to the Output Class Specific Performance Measures in Part B.
6. Property Rights over Crown-Owned Resources Are Well Managed and Allocated Efficiently
Resources such as the mineral estate and the radio spectrum need to be managed and allocated to maximise opportunities for business growth. The Ministry advises on the management of these assets and allocates the rights to utilise or exploit them, bearing in mind the Crown's obligations under the Treaty of Waitangi.
Examples of activities that contribute to this goal are:
- developing a programme of spectrum allocation for the period 2003-2006;
- promoting investment opportunities for exploration and development of petroleum and minerals; and
- reporting to the Minister on land access provisions under the Crown Minerals Act.
For further details of the outputs under the contributing Votes: Communications and Energy refer to the Output Class Specific Performance Measures in Part B.
7. The Allocation and Registration of Intellectual Property Rights Supports Innovation and Business Activity
New Zealand's intellectual property laws underpin innovation in the economy. People who generate good business ideas need to be assured that their ownership of them is protected so that they can benefit commercially. This also provides incentives for continued innovation and invention. Innovation is also generated through access to knowledge and ideas, and building on the work of others. Legal protection for intellectual property must take account of all of these factors.
Intellectual property laws need to conform to international standards, so that the rights of New Zealand entrepreneurs are protected overseas, and foreign firms feel secure in investing in New Zealand. They should also enable access by New Zealand entrepreneurs to technology developments overseas, as New Zealand is a substantial importer of technology. Finally, the process for protecting intellectual property needs to be smooth, easy and quick, to keep costs down and to reduce the time to market for new products and services.
The Ministry advises on intellectual property law, and offers fast-turnaround registration services to support entrepreneurial activity in New Zealand.
Examples of activities that contribute to this goal are:
- advising on the reform of the Patents Act, a review of issues raised for copyright legislation by digital technology, and the implementation of the new Trade Marks Act;
- processing trade marks and design, patents, and plant variety rights applications rapidly so as to minimise the potential time to market products resulting from innovation and entrepreneurial activity; and
- ensuring the rights allocation methodology is appropriate to give assurance to the business community on the validity of intellectual property rights and interests.
For further details of the outputs under the contributing Vote: Commerce refer to the Output Class Specific Performance Measures in Part B.
8. New Zealand's Regulatory Institutions Can Effectively Monitor and Enforce Business Regulations
New Zealand has the population of a European city, yet we need to maintain a regulatory infrastructure that mirrors that of other modern states. This places a considerable onus upon regulatory institutions such as those with which the Ministry has a relationship - the Commerce and Securities Commissions, the Takeovers Panel, and the Accounting Standards Review Board. Each needs to monitor and enforce regulations in the same way as similar organisations in much larger nations with more resources, and do so over time. These institutions also need to work effectively with private institutions such as the Stock Exchange and professional bodies, if the regulatory goals are to be achieved.
The Ministry is working to enhance our understanding of what New Zealand's capability requirements are in terms of monitoring and enforcement, and will be developing advice which ensures that New Zealand can effectively and efficiently deliver what is required of us as a nation.
Examples of activities that contribute to this goal are:
- advising on appointments to boards of regulatory institutions, and monitoring and reporting on the financial and non-financial performance of those institutions;
- supporting enactment of the Securities Markets and Institutions Bill, which strengthens the enforcement of securities law and establishes a co-regulatory regime for capital markets;
- advising on services and activities regulated under the Telecommunications Act 2001; and
- monitoring and reporting on the Commerce Commission's administration of electricity line regulation.
For further details of the outputs under the contributing Votes: Commerce, Communications, Consumer Affairs, and Energy refer to the Output Class Specific Performance Measures in Part B.
Growth Outcome: Regional Development, Business Growth and Innovation Are Actively Facilitated and Encouraged
To achieve this outcome, the Ministry will focus on the following supporting goals:
1. Regions Have the Capability to Make the Most of Their Economic Potential
Improved economic performance in New Zealand's regions assists local communities as well as contributing to the growth of the nation as a whole. Many regions lack the capacity or institutional structures to make the most of their respective strengths. The Ministry is facilitating the development by regions and communities of local strategies that respond to local opportunities. We are working with other agencies to bring a "whole of government" approach to regional problems, and are providing advice and support to help build regional capability and institutions.
Other examples of activities that contribute to this goal are:
- building partnerships with regional groups to ensure that the processes used to formulate policy advice and development programmes incorporate broad community and sectoral perspectives;
- advising on the design, co-ordination, implementation and review of industry and regional development programmes;
- reviewing the design and implementation of the Regional Partnership Programme, and identifying opportunities to improve the Ministry's engagement with the regions;
- facilitating improvements in regional capability for development and business support; and
- providing targeted financial support for development initiatives through the Regional Investment Fund.
For further details of the outputs under the contributing Votes: Economic, Industry and Regional Development, and Tourism refer to the Output Class Specific Performance Measures in Part B.
2. Increased Māori and Pacific Island Participation in New Zealand's Economic Development
The Government has a particular commitment to the economic development of iwi/Māori. In addition, Māori and Pacific Island peoples represent a growing proportion of New Zealand's population. Improved economic participation of these communities is important for New Zealand's overall economic performance. The Government wants a "whole of government" approach to the creation of greater opportunity for Māori and Pacific Island communities, and the Ministry will be working with other departments and agencies to provide advice and practical assistance to these groups.
Examples of activities that contribute to this goal are:
- encouraging economic development of Māori and Pacific Island communities through targeted facilitation, sponsorship of key events and Ministry scholarships for promising Māori and Pacific Island individuals;
- increasing our knowledge - through research and engagement - of Māori and Pacific Island businesses to identify how policies and programmes can be designed or refined to best meet the needs of these communities; and
- improving our internal capability to engage effectively with Māori and Pacific Island communities, to fully appreciate their issues and interests, and to work with other departments and agencies in identifying and developing practical solutions.
For further details of the outputs under the contributing Votes: Consumer Affairs, Economic, Industry and Regional Development refer to the Output Class Specific Performance Measures in Part B.
3. New Zealand Has Greater Enterprise Capability in Its Businesses and the Wider Community
For New Zealand to increase its rate of economic growth we need more new successful businesses as well as expansion of existing businesses. Many people have business ideas, but few put them into practice, and fewer still translate them into successful commercial enterprises. Those who want to start in business need access to information as well as advice and support. To flourish and grow, firms require skilled workers and sound management. Those seeking to enter or re-enter the workforce, or to change or upgrade their skills, need appropriate support and training. Those managing businesses need access to informal and formal training opportunities so that businesses will have more confidence to grow, and to develop and commercialise new ideas. In our policy advice and our work with other agencies, the Ministry will seek to foster these conditions in our communities.
Examples of activities that contribute to this goal are:
- providing regular updates for the Minister for Industry and Regional Development on regional development priorities, and implications for policies and programmes;
- advising on business opportunities associated with the efficient and environmentally sustainable use of resources, and implications for policies and programmes;
- implementing the Government's growth and innovation framework, and in particular working with other agencies to advise on the means to enhance skills development and innovation;
- reviewing and reporting on Industry New Zealand and Tourism New Zealand programmes; and
- ongoing work with the ICT, Biotech and Creative task forces to identify how these key sectors can enjoy improved sustained economic growth.
For further details of the outputs under the contributing Votes: Economic, Industry and Regional Development, and Tourism refer to the Output Class Specific Performance Measures in Part B.
4. New Zealand Has High Quality and Effective National and Regional Infrastructure
Businesses rely on high quality infrastructure to produce goods and services, maintain contacts, and get products to market on time and at the lowest possible cost. Key infrastructure includes reliable and cost effective supplies of energy as well as modern communications services and fast internet. The Ministry takes a lead role in advising the Government on the regulation of network industries, principally telecommunications, electricity and gas. Our regulatory role is to promote good governance and regulatory design so that supply risks are effectively managed, prices are fair to both consumers and suppliers, and technological development is encouraged. In addition, our regional development policy advice seeks to assist in the co-ordination of infrastructure investment by central and local government to best support business development.
Other examples of activities that contribute to this goal are:
- co-ordinating implementation of the Government's e-commerce strategy;
- developing and implementing a strategy to support the Government's goal of high speed (broadband) internet access being available in all New Zealand communities; and
- advising on initiatives to facilitate contestable provision of telecommunications services in remote areas.
For further details of the outputs under the contributing Votes: Communications, Consumer Affairs, Energy, and Tourism refer to the Output Class Specific Performance Measures in Part B.
5. New Zealand's Culture Promotes and Supports Innovation and Entrepreneurship
We need to take as much pride in our commercial achievements as in our sporting triumphs. Innovators and entrepreneurs generate employment, business opportunities and the potential for higher incomes, and we need to support and enable their effort and risk-taking. The Ministry's policy advice will focus on further encouraging the development of a culture which supports innovation and entrepreneurship in New Zealand.
Examples of activities that contribute to this goal are:
- developing a report on the state and capability of enterprise culture and innovation systems in the regions, and the implications for policies and programmes;
- taking a "roadshow" to the regions, communicating messages from the Innovate Event about how to support local innovation and entrepreneurship;
- facilitating linkages between regional innovators and local agencies offering support for business development; and
- further developing our understanding of the factors which can support and enable the innovation system in New Zealand, and building this into our policy advice.
For further details of the outputs under the contributing Votes: Economic, Industry and Regional Development and Tourism refer to the Output Class Specific Performance Measures in Part B.
6. Government Action to Encourage and Facilitate Sustainable Economic Development Is Based on Robust and Well-Researched Policy Advice
The Government's growth and innovation framework underlines the importance of sustainable economic development to the future wellbeing of our citizens. This is true of all countries, but the international experience of governments intervening to facilitate development has often been disappointing. New Zealand has certain characteristics (such as our size, our distance from major markets, and the preponderance of small businesses) which present particular challenges. The Ministry is working to enhance its understanding of how government can help promote business activity and growth in New Zealand. In doing so, we will draw on the knowledge and expertise of iwi, regional and local government, businesses and consumer representatives. We will be building this understanding into policy advice spanning our diverse range of activities. Over time, this will create a clearer picture of how government can most effectively deploy taxpayer dollars to promote enterprise in New Zealand.
Other examples of activities that contribute to this goal are:
- further developing the Government's growth and innovation framework, and advising on the means to further enhance alignment and co-ordination of public sector policy;
- reviewing and reporting on Industry New Zealand industry development programmes to ensure they are delivering efficiently and effectively against the Government's objectives; and
- facilitating and resourcing communities of interest or stakeholders in the tourism industry, to respond to the recommendations in New Zealand Tourism Strategy 2010.
For further details of the outputs under the contributing Votes: Economic, Industry and Regional Development, Commerce, Energy, and Tourism refer to the Output Class Specific Performance Measures in Part B.
7. Activities That Stimulate Economic Development Are Co-Ordinated Across the Whole of Government
Economic development in New Zealand is not the sole responsibility of the Ministry. The promotion of economic growth, and of wider sustainable development, requires a genuinely "whole of government" approach. The Ministry has been given a leadership role in the implementation of the growth and innovation framework, and also has a wider role in helping to co-ordinate the work of different departments that impact on business activity in New Zealand. This does not imply that the Ministry should be expert in everything, but it does mean that we have a clear responsibility to advise and guide other departments and Ministers on how the public sector can work together to achieve the Government's economic development objectives.
Examples of activities that contribute to this goal are:
- ongoing work with Industry New Zealand and other agencies to ensure the successful operation of the ICT, Biotech, and Creative task forces and engagement in policy dialogue where appropriate; and
- facilitating a Budget Round process that enables Ministers to prioritise expenditure across all government agencies involved in economic development.
For further details of the outputs under the contributing Votes: Economic, Industry and Regional Development and Commerce refer to the Output Class Specific Performance Measures in Part B.
Ministry of Economic Development Outcomes and Supporting Goals
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