Engagement Objectives, Process and Structure
15. The size of the Food and Beverage sector, the range of players at various points in the value chain and the number of government agencies that are involved in the sector, means that the process and governance arrangements for the engagement will be more complex than for previous engagements.
The Engagement's Name
16. It is recommended that the Food and Beverage engagement group be called a "Taskforce" so that it can build on the GIF Sector Taskforce branding, hence positioning it in the innovation and "high-growth high-value" firm space. Ministers may also want to specifically position Food and Beverage as a key GIF initiative. This would assist in mitigating an impression prevalent in the sector that the GIF process has not been sufficiently focused on the contribution and potential of Food and Beverage.
Engagement Objectives
17. Government sector engagement policy [CBC (04) 70 refers] defines the generic objectives of sector engagement as:
- Facilitating sustainable economic development, e.g. by encouraging an increase in the proportion of firms pursuing high value-added activities;
- Ensuring generic policies and institutional arrangements are impacting on a sector in a consistent and mutually reinforcing way; that is, opportunities to change government generic or sector specific policy settings in order to lift industry growth rates should be identified;
- Improving co-ordination, linkages and networks between government and the sector, particularly in respect of industry assistance, science and education.
18. The key task for the Food and Beverage Taskforce will be establishing a development agenda for the sector, including bold targets if these are deemed appropriate, and securing stakeholders ownership of that agenda and commitment to implementing it.
19. The Taskforce should provide vision, drive and information to help shape strategic thinking in the sector, in order to take it to the next level of development.
20. Full Terms of Reference, including identification of the scope of the engagement, specific Food and Beverage engagement objectives and criteria for Taskforce membership is attached as Annex 1.
Ideal Outcome
21. The ideal outcome would be that the resources of industry, government, science and education are focused in partnership to deliver faster, smarter, sustainable growth in the Food and Beverage sector.
Importance to Māori Economic Development
22. Māori have significant interests in fishing quota and agricultural assets. It will be important that Taskforce membership includes people with knowledge of Māori interests in the Food and Beverage sector, and the suggested candidates for Co-Chair and Taskforce membership (see Annex 2 and Annex 3 and discussion below) takes this into consideration. MAF has a strong Māori policy capability focused on Māori land and skills and employment issues, and this capability will be applied as an integral part of the sector engagement. The Food and Beverage sector engagement could have a significant impact in addressing the interests and opportunities of Māori.
Focus on Sustainable Economic Growth
23. The Food and Beverage engagement must be positioned in the context of the Government's vision for New Zealand, as outlined in the Growth and Innovation Framework and reaffirmed in the Sustainable Development Programme of Action. Sustainability is particularly important to primary production industries such as Food and Beverage. In addition increased consumer demand for safe, healthy and sustainably produced products provides important economic opportunities.
Lessons from Previous Sector Engagements
24. The experience of both the GIF Taskforces and the Wood Processing Strategy has been reviewed. From this information the following five components are considered essential to a successful engagement process:
- Senior Ministerial leadership - particularly to assure the sector of the Government's commitment to progress issues and drive whole-of-government participation including implementation;
- Participation and commitment of key sector leaders - if this cannot be secured then the engagement should not proceed;
- The leadership and close involvement of senior public servants, particularly if they have a mandate and direction from their Ministers to take action and drive the process forward;
- Effective co-ordination of the whole of government process including government agency input, policy analysis and implementation; and
- Effective project management.
25. Taking these lessons into consideration, and recognising the complexity of the task, the following model is suggested.
Preferred Model
26. An evolutionary and flexible model similar to the Wood Processing Strategy is preferred over the GIF Taskforce model, but with some important improvements. The proposed improvements include:
- the engagement should be time-bound from the outset with clear (albeit overlapping) engagement and implementation phases;
- in recognition of the size and importance of the sector and the need to demonstrate the Government's commitment to the process, the Chief Executives of MAF and NZTE should both be members of the core Taskforce - this is in line with Australian practice; and
- a final report (as with the GIF taskforces) will not be a required outcome, but the Taskforce might decide to publish a report or series of papers, to enable its thinking, particularly on any strategic objectives, to be communicated to the many thousands of participants in the sector.
27. A flexible process will enable a dynamic working relationship to develop with issues addressed as they arise and recommendations implemented as they are agreed, rather than waiting until the Taskforce process is complete.
Ministerial Responsibilities
28. Given the relevance of both portfolios to the sector, it is proposed that the Minister for Economic Development and the Minister of Agriculture both serve on the Taskforce, with the Minister for Economic Development acting as Co-Chair, taking a similar role to that played in the Wood Processing Strategy and GIF Taskforces.
29. In addition, the involvement of other Ministers with a direct, day-to-day role in the Food and Beverage sector, such as the Minister for Food Safety; the Minister for Research, Science and Technology; the Minister for Social Development and Employment; the Associate Minister of Education (Tertiary Education); and the Minister of Fisheries will be important. These Ministers and others as appropriate can be co-opted to participate in Taskforce meetings as required.
30. As innovation will be a core component of the Taskforce's deliberations, all GIF Ministers will have an interest in the engagement and will need to be kept appraised of progress.
Working Groups
31. The Taskforce will identify the key issues and opportunities for the sector, and may establish Working Groups to work on specific priority issues. These will be comprised of expert sector representatives and officials from government agencies responsible for policy relating to the issue in question, such as MAF, NZTE, TEC, MoRST, FRST, Department of Labour, Ministry of Social Development and others. It is at this level that other groups within the sector, such as Industry Training Organisations or sector representative bodies may be involved or consulted. The size of Working Groups will be flexible as will be their duration. They will be Co-Chaired by a sector representative and a government official.
32. The output of the Working Groups will usually be advice to the Taskforce on possible actions for the government and/or industry to address the issue under consideration. The Working Groups may also produce discussion papers or other papers on issues. In parallel with advice to the Taskforce, the relevant government officials will, as appropriate, advise relevant Ministers on policy proposals.
Taskforce Size and Membership
33. The Taskforce needs to be a manageable size, bearing in mind that key players and experts not included on the Taskforce itself will likely be called upon to participate at the Working Group level.
34. Officials are working on the assumption that the Taskforce will be made up of:
- the Minister for Economic Development (as Co-Chair) and the Minister of Agriculture;
- the Chief Executives of the Ministry of Agriculture and Forestry and New Zealand Trade and Enterprise (see also Lead Agencies below);
- a private sector Co-Chair; and
- up to twelve further representatives drawn from the private sector and the education, science and research sectors.
Appointment Process
35. Officials sought views on potential candidates for Taskforce membership as part of the consultation with private sector stakeholders on the engagement. Officials from MAF, NZTE and the New Zealand Food Safety Authority (NZFSA), who have extensive knowledge of the sector, have also had comprehensive discussions on the potential makeup of the Taskforce, in consultation with officials from MED.
36. From these deliberations a list of recommended Taskforce candidates from which the Taskforce can be drawn has been compiled and is attached as Annex 3. Three options for the private sector Co-Chair are also provided and attached as Annex 2.
37. In drawing up this list officials applied the following criteria:
- knowledge of the whole value chain, rather than attempting to represent every food and beverage sub-sector;
- knowledge of key aspects such as skills and talent, science and innovation, and investment as well as a strong economic development perspective;
- the need for participation of key players in the industry;
38. Detailed membership criteria are provided as part of the Terms of Reference attached as Annex 1.
39. It is proposed that Cabinet note the attached list of candidates for the Taskforce and private sector Co-Chair. Candidates will then be contacted to ascertain their availability.
40. It is proposed that the Ministers of Economic Development and Agriculture be empowered to finalise selection of the private sector Co-Chair and Taskforce membership (including going outside the attached lists if required) in consultation with the Prime Minister.
41. It is proposed that the final selections for Taskforce membership, including the Co-Chair, will be submitted to Cabinet by the Minister for Economic Development and the Minister of Agriculture for approval.
Payment of Taskforce Members
42. In line with the practice for the GIF Taskforces, Taskforce members will not be paid, but will be reimbursed for travel and accommodation costs. The cost of participation by government officials, e.g. at the working group level, will be borne by their respective agencies.
43. Because of the size of the Food and Beverage sector and the complexity of the engagement, the commitment of the private sector Co-Chair to the process will be crucial. For this reason, consideration should be given to paying the Co-Chair the equivalent of a director's fee. If this is agreed, then it is suggested that the amount be commensurate with that paid to the Chair of the Growth and Innovation Advisory Board.
Lead Agencies
44. Cabinet has agreed that, on a case-by-case basis, the lead agency for high-level vertical sector engagement should be the agency with the best overview of the sector [CBC (04) 70 refers]. Both MAF (and the New Zealand Food Safety Authority) and NZTE have key roles and complementary expertise with respect to the Food and Beverage sector. As the perspectives of both will be crucial to the success of the engagement, it is recommended that MAF and NZTE act jointly as the lead agencies responsible for the Food and Beverage Sector engagement. As indicated above, it is recommended that the Chief Executives of MAF and NZTE be included as members of the Food and Beverage Taskforce.
Secretariat
45. Building on the institutional experience of running sector engagements, NZTE will be responsible for leading the engagement's organisation and administration (the operational dimension) and will provide the Secretariat.
46. The role of the secretariat will be to project manage the engagement and provide administrative support to the Food and Beverage Taskforce and Working Groups.
47. The Secretariat will be comprised of a contracted project manager and an administrator. Officials from MAF, NZFSA, MED, NZTE, TEC, Department of Labour, MFAT and other agencies as required will be seconded to the Secretariat on an as-needed basis.
Whole of Government Co-ordination
48. MAF will be responsible for leading the whole of government co-ordination and input (that is, the policy dimension), including ensuring robust government agency input into the engagement, such as participation in working groups, and timely implementation of recommended actions.
49. To this end an Inter-Agency Food and Beverage Policy Group has been established with representatives from MED, TPK, MAF, NZFSA, NZTE, TEC, MoRST, MFAT, FRST, DoL, Ministry of Fisheries, Ministry of Social Development, Treasury and DPMC. Other agencies as appropriate will be added to this group. This group will be the key vehicle for a robust whole-of-government process. It may also be used to proactively seek input and explore policy issues with the public sector agencies, particularly in those areas for which government has key responsibility, such as regulation, capability-building and public good research, science and technology. Departments will also be key to ensuring the process builds on the learning and policy development of past engagements.
50. This Inter-Agency Policy Group will be convened by MAF on an as-needed basis.
Officials Oversight Committee
51. The Taskforce will be responsible for directing and oversight of the work programme. It will be important, however, for there to be a mechanism at officials' level to oversee the engagement in terms of process and organisation, including monitoring risks, quality, timeliness and the effectiveness of governance arrangements. To this end an Officials Oversight Committee comprised of representatives from NZTE, MAF, NZFSA, and MED and the project manager will be established. This Committee will report on these issues to Ministers of Economic Development and Agriculture quarterly.
Flexible Approach to Development of Process
52. This engagement will be complex, and the agencies involved recognise that managing the issues and inter-relationships between them will require close working relationships and a willingness to change the management of the process as it progresses if that is required.
Timeline
53. Two phases of work are envisaged.
Active Engagement Phase
54. The active engagement phase will be a series of Taskforce and Working Group meetings. It is recommended that the Taskforce and associated working groups be allowed up to 18 months to complete their work (to June 2006), remembering that implementation will begin concurrently.
55. The engagement work programme following the initial Taskforce meeting will be dependant on the priorities identified by the Taskforce itself.
Implementation Phase
56. The implementation phase will potentially last 3-5 years. It is recommended, however, that the Taskforce itself be asked to provide advice on the length of the implementation phase, taking into account the nature of the recommendations, and need for this to be a time-bound process.
57. It is envisaged that the implementation phase will begin concurrently with the active engagement phase, so that early wins can be implemented on an as-you-go- basis. The precise nature of the implementation will depend on the outcomes of the engagement process.
58. The following is an indicative timeline.
Indicative Timeframe
| 2004 |
|---|
| October 2004 | Submission to Cabinet to agree process |
|---|
| October - November 2004 | Recruit and appoint Taskforce members, set up secretariat |
|---|
| November - December 2004 | First Taskforce meetings |
|---|
| 2005 |
|---|
| February 2005 | Taskforce meetings continue.
Working groups set-up.
Implementation of early agreed wins begins (if any). |
|---|
| March 2005 onwards | Taskforce and Working Group meetings continue. Implementation of early wins. |
|---|
| 2006 |
|---|
| June 2006 | Engagement phase ends, implementation phase continues to agreed completion date. |
|---|
Measurements
59. The project will be successful if it:
- identifies pathways to generate a higher rate of sustainable economic growth in the sector;
- establishes a clear action plan for how this objective can be delivered;
- delivers tangible economic benefits as a result of the implementation of the action plan; and
- is considered by the sector leaders to have been beneficial.
60. It should be noted that there are gaps in the Food and Beverage statistics, and there is a case for a regular and comprehensive statistical publication on the sector which could act as a scorecard. Such a scorecard has been pioneered in South Australia and has been shown to be an effective means of measuring progress.
Engagement Budget
61. Running the engagement is estimated to cost $800 000 over 2 years. This includes re-imbursement for travel and accommodation for Taskforce and Working Group members from the private sector, meeting costs, project management and administration, and funding available to contract research and specialist advice.
62. This will be funded out of NZTE baselines. Relevant government agencies will also have to commit resources to Working Groups and to policy work in response to recommendations.
Implementation Budget
63. Cabinet has agreed that high-level sector engagement should not lead to any substantial re-allocation of resources in favour of particular sectors, unless there are exceptional and overriding reasons for addressing a market failure or spillover [CBC (04) 70 refers].
64. Implementation of recommendations arising out of the Food and Beverage sector engagement should in the main be met from existing baselines. Nevertheless, it will be prudent to consider potential fiscal implications in establishing a contingency for the 2005 GIF Budget.
Relationship to Existing Food and Beverage Work
65. Agencies including NZTE, FRST, the Ministry for Social Development and the Department of Labour have a mandate to deliver assistance to the Food and Beverage sector, including for example funding of Industry Training Organisations (ITOs) operating within the sector. Work by these and other agencies should continue. The engagement, however, will be a means of testing and if necessary re-aligning these initiatives.
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