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Cabinet Paper: Boosting the Impact of Regional Economic Development: Detailed Changes

Hon Trevor Mallard, Minister for Industry and Regional Development
[ Last Updated 14 March 2007 ]


56. All proposals outlined in this paper will be met from within the existing annual appropriation for the RPP and within existing MED and NZTE baselines. From 2007/2008 and outyears the funding for the annual Regional Partnerships and Facilitation Other Expense to be Incurred by the Crown appropriation increases by $15m to a total of $17.756m to support both the development of business incubators and regional clusters, and grants to assist regional partnerships to identify, develop and implement sustainable economic growth strategies. As such, it is necessary to change the scope of the appropriation Regional Partnerships and Facilitation, Other Expenses to be Incurred by the Crown, shown in the Estimates to "Provision of advice and grants to support the development of business incubators and regional clusters, and to support regional partnerships to develop and implement sustainable economic growth strategies."

57. In addition, the Regional Partnerships Programme Fund under the appropriation Regional Partnerships and Facilitation, Other Expenses to be Incurred by the Crown will be disestablished and replaced with Transition Funding, Enterprising Regions Fund, Chatham Islands Funding, Auckland Regional Economic Transformation Fund and Enterprising Partnerships Fund. The impact of this change is fiscally neutral to the Crown.

58. Due to the proposal to grant RPP regions up to $50,000 in 2007/2008 to meet costs directly associated with the movement to 14 regions, and due to the funding flexibility given to regions over a three year period under the Enterprising Regions fund, the expenditure on refreshed regional programmes is expected to vary on a year by year basis, over a three year cycle. The table below sets out the impact on baseline funding.

Initiative Approval Admin 2006/07 2007/08 2008/09 2009/10 2010/11 & Outyears
Existing Fund – No Change
Incubators and clusters9 NZTE NZTE 2.756 2.756 2.756 2.756 2.756
Existing Fund – Disestablished
Regional Partnerships Programme NZTE NZTE - 15.000 15.000 15.000 15.000
Existing Baseline 2.756 17.756 17.756 17.756 17.756
New Funds - Established
Transition funding ($50,000 for 2007/08 only) NZTE NZTE - 1.300 - - -
Enterprising Regions Fund (up to $750,000 over three years) NZTE NZTE - 3.375 3.938 3.187 3.375
Chatham Islands funding (up to $150,000 over three years) NZTE NZTE - 0.075 0.038 0.037 0.075
Auckland Regional Economic Transformation Fund Minister of Industry and Regional Development MED/ NZTE - 1.000 1.000 1.000 -
Enterprising Partnerships Fund Cabinet MED/ NZTE - 9.250 10.450 10.450 11.450
Total – New Funds 15.000 15.426 14.674 14.900
Total – Existing and New Funds 2.756 17.756 18.182 17.430 17.656
Rephasing Change Required to Existing Baseline - - 0.426 (0.326) (0.100)

9 This refers to the existing funding for cluster and incubator programmes, which are not discussed in this paper, but have been included for completeness. No changes are proposed for these programmes.


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