Executive Summary
2. Recent engagements with sectors have led to an appreciation that a government-facilitated process to address sector specific impediments to growth can be an effective economic development tool. The government has so far taken various approaches and used different selection criteria to identify sectors for potential engagement. A clear framework, specifying rationale and aims, criteria for selection and prioritising sectors, and a process for managing engagement, is needed to effectively prioritise and coordinate government resources involved in sector engagement.
3. The government will continue to engage with vertical sectors at three levels: whole-of-government engagement involving all appropriate agencies to develop a sector led strategy in partnership with the sector, ongoing business as usual engagement through the delivery agencies (NZTE, FRST and TEC), and issue specific engagement. The government should also remain open to identifying and promoting general-purpose technologies on a case-by-case basis because of their potential impact on productivity across sectors (e.g. ICT).
4. The aim of whole-of-government vertical sector engagement should be to help the sector develop a clear vision of how it might improve its sustainable economic growth. Because raising the rate of sustainable economic growth requires all sectors to contribute to higher growth, it is proposed that the government engage with all "economically significant sectors" i.e. all sectors which do, or could potentially, make a substantial contribution to sustainable economic growth based on their contribution to GDP or potential to grow and the value they can add across a range of other sectors. Sector selection should also be based on the commitment and ability of the sector to work in partnership with government and the ability of the government to add value.
5. High-level sector engagement should not normally result in any substantial shift in resource allocations to favour specific sectors. As a general principle, interventions that aim to improve the implementation of existing policies and programmes, or improve the quality of regulation, should be favoured over interventions involving sector-specific direct assistance. Exceptions should only be made where there are compelling and overriding reasons, such as an identifiable market failure or spillover that is specific to a particular sector.
6. A three-stage implementation process for high-level engagement with vertical sectors is proposed: sector selection and preliminary planning, the development of a sector-led strategy, followed by an implementation phase. Each engagement would be designed on a case-by-case basis, according to the requirements of the individual sector. Each would also need Cabinet approval and decisions on specific issues including the lead agency and Ministerial leadership. It is proposed that MED will be responsible for overseeing the coordination and alignment of sector engagement across government and the evaluation of sector engagements.
7. Subject to approval of the framework, further preliminary work and discussion with the sector, it is recommended that the food and beverage sector should be the focus of the next high-level engagement.
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