Industry New Zealand Select Committee Report Presented To Parliament

6 May 2002

Today the Commerce Committee presented a report to the House on its 2000/01 financial review of the performance and current operations of Industry New Zealand.

In summary the committee reported on the following matters:

- We view with serious concern the “just adequate’ ratings assigned to INZ, and note INZ’s assurance that it is now working towards improving the accuracy of its reporting and enhancing its performance. We expect substantial improvement between now and the next financial review as systems are established. We will be monitoring progress closely.

- We recognise lags in programme implementation are not entirely unexpected when setting up a new organisation and functions.

- We note with some concern that the Chief Executive of INZ was not appointed until April 2001, six months after INZ became operational. We also note the need to lease executives. We note that INZ has made progress in reducing reliance on contractors and consultants as required by the Minister.

- While we acknowledge that INZ is a new agency, we express concern at the major variance between budgeted and actual expenditure, particularly the extent of new spending in unbudgeted areas such as the regional initiatives fund, sector initiative fund and incubator awards. We are concerned at the slow rate of drawing down for the regional partnership programme and the business growth scheme, particularly given the stated intent of INZ to encourage regional business development, although we note that grants cannot actually be paid by INZ until invoices are received.

- We are pleased to note that INZ is currently working to encourage its clients to initiate the activity for which they will receive funding.

- We would like to see an on-going monitoring programme to highlight actual outcomes beyond the fact that funding has been spent. This is a matter of priority, which we were told is underway.

- We note reports that it is difficult to receive an Enterprise Award grant but are aware that INZ continually monitors the scheme to ensure that access to it is not an issue. However, we note the need to maintain project quality to ensure that desired outcomes are achieved.

- We are concerned at the regional spread of awards and grants made to date, as this is an important issue. We note that work is on-going within the regions to gain funding from INZ and we expect a more even spread in future years.

- We recognise the importance of a sector strategy approach to match regional development and we will be monitoring the outcomes of these sector strategies.

A copy of the report will be replaced on the Office of the Clerk website. www.parliament.govt.nz.

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