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• 1999/2000

• Revenue
• Output Expenses

The following explains the most significant movements in actual results between 1998/1999 and 1999/2000 for departmental activities.

Revenue

Revenue Crown earned for departmental outputs has increased by $0.455 million mainly due to:

• an increase in the 1999/2000 Government Superannuation Fund's funding following the transfer of the GSF's residual functions to the Ministry of Economic Development and a review of GSF's departmental baseline during 1998;
• a technical adjustment made in 1999/2000 to meet cost of investment management expenses previously recovered from the GSF fund as third party revenue in contravention of the Government Superannuation Act 1956 (Vote: GSF);
• establishment costs associated with the new Crown entity Industry New Zealand and interim policy advice costs associated with the new Economic Development, and Industry and Regional Development portfolios (Vote: Business Development);
• costs incurred in 1999/2000 for the Ministerial Inquiry into Telecommunications (Vote: Communications);
• one-off cost incurred in undertaking the Electricity Inquiry (Vote: Energy); and
• additional costs incurred in 1999/2000 for initiatives to address the Year 2000 readiness issues (Vote: Communications).

These increases were offset by reductions mainly due to:

• Vote: Commerce related policy advice initiatives reflecting:
• the decision by the Government not to proceed with the completion of the water and waste water review which has since been transferred to Local Government New Zealand;
• the completion of the ACC Reform tasks in 1998/1999; and
• the completion of the consultative regional forums with business undertaken during 1998/1999;
• reduced Energy Efficiency Conservation Authority (EECA) funding in 1999/2000 pending the completion of a review on EECA's optimal structure for the delivery of the Government's energy efficiency and conservation outcomes (Vote: Energy). EECA became a Crown entity, administered by the Ministry for the Environment, on 1 July 2000;
• one-off funding in 1998/1999 to meet transitional costs for the disestablishment of the Business Development Boards and setting up new delivery mechanisms for the BIZ programme (Vote: Business Development); and
• one-off costs in 1998/1999 to host the APEC Ministers Small and Medium Enterprises (SMEs) meeting and associated forum/events (Vote: Business Development).

Revenue Other earned for departmental outputs has reduced by $5.956 million mainly due to:

• lower fees being charged for the registration and granting of intellectual property rights, and the registration and provision of statutory information from 1 July 1999 as a result of a fees review undertaken during 1998/1999 (Vote: Commerce);
• a reduction in radio licence annual fees due to timing of revenue recognition and a drop in land mobile single frequency licence fees (Vote: Communications);
• a reduction in stock rental fees previously recovered from the GSF Fund in contravention of the Government Superannuation Act 1956 and subsequently funded from Revenue Crown (refer also comments above - Vote: GSF); and
• one-off sponsorship for the APEC SMEs conference (Vote: Business Development).

These reductions were offset by a one-off increase relating to the hosting of the New Zealand Petroleum Conference in March 2000 (Vote: Energy).

Output Expenses

Output expenses have reduced by $1.286 million, mainly due to the expense side of the changes referred to above and additional expenses incurred in 1998/1999 to clear a backlog of unprocessed patent and trade mark applications (Vote: Commerce).

These reductions are offset by an increase in expenses associated with the promotion of petroleum exploration. The envisaged increase in third party revenue expected to result from the promotion of petroleum exploration was not achieved because the fall in oil price in early 1999 resulted in the surrender of a number of oil permits (Vote: Energy).