Statement of Intent 2007–2010

Part 7: Financial Information

Table of Contents:

From the Minister

Part 1: Introduction and Health Context

Part 2: The Government’s Priorities

Part 3: The Ministry’s Vision and Outcomes Framework

Part 4: What the Ministry Does

Part 5: Measuring the Ministry’s Progress

Part 6: The Ministry’s Strategy: ‘Better Health for All’

Part 7: Financial Information

References

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In this section:

• Statement of Responsibility
• Ministry of Health – Overview
• Crown Funding
• Financial Highlights
• Statement of Forecast Service Performance
• Departmental Output Expense: Administration of funding and purchasing of health and disability support services on behalf of the Crown
• Departmental Output Expense: Administration of legislation and regulations
• Departmental Output Expense: Funding and performance of Crown entities
• Departmental Output Expense: Information services
• Departmental Output Expense: Payment services
• Departmental Output Expense: Servicing of Ministers and Ministerial committees
• Departmental Output Expense: Strategy, policy and system performance

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Statement of Responsibility

The information contained in this Statement of Intent for the Ministry of Health has been prepared in accordance with section 38 of the Public Finance Act 1989. The forecast financial statements are based on the best information available and incorporate Government’s decisions to date of devolution to DHBs of a range of rights and obligations under service agreements and statutory notices.

As Director-General of Health, I acknowledge, in signing this statement, that I am responsible for the information contained in this Statement of Intent.

The performance forecast for each output appropriation in the Statement of Forecast Service Performance is as agreed with the Minister of Health responsible for Vote Health administered by the Ministry of Health.

The financial performance forecast for the Ministry of Health in the forecast financial statements and the statement of forecast service performance, is as agreed with the Hon Pete Hodgson, who is the Minister responsible for the financial performance of the Ministry of Health.

The information contained in this Statement of Intent is consistent with existing appropriations,and with the appropriations set out in the Appropriation (2007/08 Estimates) Bill.

Signed
Stephen McKernan
Director-General of Health
23 April 2007

Countersigned
Paul D Helm
Chief Financial Officer
23 April 2007

Ministry of Health – Overview

Ministry Funding

Departmental appropriations

Vote Health appropriations ($204.033 million) relate to the functions of the Ministry of Health for policy advice, purchasing of national health services, performance monitoring of the funders and providers of health and disability services, developing and administering regulations related to health service facilities, providers and public safety, ministerial servicing, and information services.

The Vote Health departmental appropriations structure is changed in 2007/08.

Crown Funding

Non-departmental appropriations

Output Expenses

• $10,860.491 million is for funding and purchases of health services and will be spent as follows:
• $8,550.771 million to fund health services from DHBs
• $859.563 million to purchase national disability support services
• $396.435 million to purchase public health services
• $721.611 million to purchase national health services and provide clinical training for health professionals
• $6.765 million to extend the meningococcal vaccine programme
• $291.833 million to address risks and fund health and disability service contracts
• $17.289 million to fund treatment and education services on problem gambling
• $2.095 million to fund services from independent service providers and the Crown Health Financing Agency (CHFA)
• $14.076 million to fund the monitoring and protection of health and disability consumers’interests
• $0.053 million to fund scientific advice on biosecurity in relation to exotic mosquitoes.

Other Expenses

• $17.912 million is for other expenses and is intended to be spent as follows:
• $13.889 million to fund provider development
• $1.778 million to fund legal expenses
• $2.245 million to fund international health obligations including WHO membership, and a contribution to the Australian Kidney Foundation.

Capital Expenditure

$846.267 million is to provide capital funding and will be spent as follows:

• $250.824 million is for capital contributions to DHBs and the NZ Blood Service for construction and other capital requirements
• $109.200 million to fund new debt for DHBs, for construction and other capital requirements
• $3.524 million to fund the capital purchases and development costs to prepare for significant health emergencies
• $20.000 million to finance loans to assist clients in long-term care
• $392.719 million to fund the renewal of DHB loans held by the Crown
• $70.000 million to fund the refinancing of DHB private debts.

Crown Revenue and Receipts

The Ministry expects to collect $591.403 million of Crown Revenue and Receipts in 2007/08,mainly for the reimbursement of accident-related acute public hospital costs from the Accident Compensation Corporation.

Financial Highlights

Summaries of financial highlights are shown in the following tables.

Departmental

	Budget 2006/07 $000	Estimated Actual 2006/07 $000	Budget 2007/08 $000
Revenue:
Crown	168,417	168,417	193,297
Other	16,391	16,391	10,736
Output expenses	184,742	184,742	204,033
Net surplus	66	66	-
Closing taxpayers’ funds	18,498	18,498	26,911
Net cash flows from operating and investing activities	14,800	14,800	(6,685)

Non-Departmental

	Budget 2006/07 $000	Estimated Actual 2006/07 $000	Budget 2007/08 $000
Vote Health:
Output Expenses:
District Health Boards (DHBs)	8,001,890	8,001,890	8,550,771
National disability support	755,908	753,658	859,563
Public health	328,795	327,495	396,435
National health (various appropriations)	539,681	536,619	721,611
Meningococcal vaccine programme	7,730	7,730	6,765
Problem gambling	20,324	20,324	17,289
Independent advice from Crown entities	15,005	15,005	16,171
Primary care and other health services	116,658	116,658	291,886
Total Output Expenses	9,785,991	9,779,379	10,860,491
Other Expenses:
Provider development	13,889	13,889	13,889
Legal expenses	10,287	10,287	1,778
International health obligations	2,245	2,245	2,245
Total Other Expenses	26,421	26,421	17,912
Capital Expenditure:
Equity injection and loans for capital projects	245,208	228,703	360,024
Residential care loans	20,000	10,718	20,000
Refinancing and Renewal of DHB debts	92,253	92,253	462,719
Significant health emergencies	20,230	20,230	3,524
Deficit support for DHBs	38,000	38,000	-
Total Capital Expenditure	415,691	389,904	846,267
Total Non-Departmental Expenditure	10,228,103	10,195,704	11,724,670

Forecast Statement of Financial Performance for the year ending 30 June 2008

	Budget 2006/07 $000	Estimated Actual 2006/07 $000	Budget 2007/08 $000
Revenue:
Crown	168,417	168,417	193,297
Other	16,391	16,391	10,736
Total Revenue	184,808	184,808	204,033
Expenses:
Personnel	90,346	90,346	103,000
Operating	82,181	82,181	88,104
Depreciation	10,933	10,933	11,309
Capital charge	1,282	1,282	1,620
Total Expenses	184,742	184,742	204,033
Surplus/(Deficit) from Operations	66	66	-

Forecast Statement of Financial Position as at 30 June 2008

	Budgeted Financial Position as at 30/06/07 $000	Estimated Financial Position as at 30/06/07 $000	Budgeted Financial Postion as at 30/06/08 $000
Taxpayers’ Funds:
General funds	16,133	16,133	26,911
Revaluations reserve	2,365	2,365	-
Total Taxpayers’ Funds	18,498	18,498	26,911
Represented by:
Assets:
Current Assets
Cash and bank	20,505	20,505	22,218
Prepayments	454	454	454
Receivables and advances	1,116	1,116	1,116
Total Current Assets	22,075	22,075	23,788
Non-current Assets
Physical assets	32,907	32,907	18,712
Intangible assets	-	-	18,234
Total Assets	54,982	54,982	60,734
Liabilities:
Current Liabilities
Creditors and payables	26,820	26,820	24,174
Provision for repayment of surplus	66	66	-
Deferred revenue	1,419	1,419	1,419
Employee entitlements	6,074	6,074	6,125
Total Current Liabilities	34,379	34,379	31,718
Non-current Liabilities
Employee entitlements	2,105	2,105	2,105
Total Non-current Liabilities	2,105	2,105	2,105
Total Liabilities	36,484	36,484	33,823
Net Assets	18,498	18,498	26,911

Revaluations reserve has been transferred to taxpayers’ funds as part of the financial position translation to meet International Financial Reporting Standard requirements.

Forecast Statement of Cash Flows for the year ending 30 June 2008

	Budget 2006/07 $000	Estimated Actual 2006/07 $000	Budget 2007/08 $000
Cash Flows from Operating Activities Cash to be provided from: Supply of outputs to:
Crown	186,169	186,169	193,044
Other	16,325	16,325	10,736
Cash to be disbursed to: Cost of producing outputs:
Operating	(172,527)	(172,527)	(190,851)
Capital charge	(1,282)	(1,282)	(1,620)
Net Cash Flows from Operating Activities	28,685	28,685	11,309
Cash Flows from Investing Activities Cash to be provided from:
Sale of physical assets	78	78	-
Cash to be disbursed to:
Purchase of physical assets	(13,963)	(13,963)	(3,030)
Purchase of intangible assets	-	-	(14,964)
Net Cash Flows from Investing Activities	(13,885)	(13,885)	(17,994)
Cash Flows from Financing Activities Cash to be provided from:
Capital contribution from the Crown	1,400	1,400	8,464
Cash to be disbursed to:
Repayment of surplus to the Crown	(3,126)	(3,126)	(66)
Net Cash Flows from Financing Activities	(1,726)	(1,726)	8 ,398
Net Increase/(Decrease) in Cash Held	13,074	13,074	1,713
Opening cash and bank balances at 1 July	7,431	7,431	20,505
Closing Cash and Bank Balances at 30 June	20,505	20,505	22,218

Reconciliation of Net Cash Flows from Operating Activities to Net Surplus/(Deficit)for the year ending 30 June 2008

	Budget 2006/07 $000	Estimated Actual 2006/07 $000	Budget 2007/08 $000
Net Surplus	66	66	-
Add/(less) non-cash items:
Depreciation	10,933	10,933	11,309
Other non-cash items	-	-	-
Total Non-Cash Items	10,933	10,933	11,309
Add/(less) working capital movements:
Increase/(decrease) in receivables and advances	17,752	17,752	-
Increase/(decrease) in prepayments	-	-	-
Increase/(decrease) in payables and provisions	-	-	-
Increase/(decrease) in GST payable	-	-	-
Increase/(decrease) in other accrued liabilities	-	-	-
Increase/(decrease) in current employee entitlements	-	-	-
Increase/(decrease) in provision for restructuring	-	-	-
Increase/(decrease) in deferred revenuex	-	-	-
Net movements in working capital	17,752	17,752	-
Add/(less) investing activities items:
Net loss/(gain) on sale of fixed assets	(66)	(66)	-
Total Investing Activities/Items	(66)	(66)	-
Net Cash Flows from Operating Activities	28,685	28,685	11,309

Forecast Statement of Movements in Taxpayers’ Funds for the year ending 30 June 2008

	Budget 2006/07 $000	Estimated Actual 2006/07 $000	Budget 2007/08 $000
Taxpayers’ Funds as at 1 July	16,133	16,133	18,447
Net surplus	66	66	-
Capital contribution	1,400	1,400	8,464
Total Recognised Revenues and Expenses for the Year	18,564	18,564	26,911
Other movements:
Provision for payment of surplus to the Crown	(66)	(66)	-
Taxpayers’ Funds as at 30 June	18,498	18,498	26,911

The 2006/07 budgeted and estimated actual financial statements have been prepared under New Zealand General Accepted Accounting Practice, and the 2007/08 forecast financial statements have been prepared under New Zealand International Financial Reporting Standards.

This has resulted in a difference between closing position as at 30 June 2007, and opening position as at 1 July 2007 for Taxpayers’ Funds.

Details of Assets by Category as at 30 June 2008

Projected Position as at 30/06/08
	Net Book Value as at 30/06/07 $000	Cost $000	Accumulated Depreciation $000	Net Book Value $000
Physical assets
Land	4,000	4,000	-	4,000
Buildings	182	204	27	177
Scientific equipment	492	3,081	2,734	347
IT hardware/software	20,854	37,962	30,632	7,330
Furniture and fittings	2,983	6,120	3,367	2,753
Leasehold improvements	4,166	12,806	8,896	3,910
Motor vehicles	230	520	325	195
Total Physical Assets	32,907	64,693	45,981	18,712
Intangible assets
IT software	-	52,265	34,031	18,234
Total Assets	32,907	116,958	80,012	36,946

Forecast Departmental Capital Expenditure for the year ending 30 June 2008

	Budget 07/08 $000	Budget 06/07 $000	Estimated Actual 06/07 $000	Actual 05/06 $000	Actual 04/05 $000	Actual 03/04 $000	Actual 02/03 $000
Physical assets
Buildings	-	-	-	40	-	-	-
Scientific equipment	120	399	399	87	64	55	568
IT hardware	2,500	11,733	11,733	6,945	9,985	5,910	10,160
Furniture and fittings	120	618	618	666	1,440	589	590
Leasehold improvements	250	1,078	1,078	2,364	218	97	942
Motor vehicles	40	138	138	-	-	77	185
Total Physical assets	3,030	13,966	13,966	10,062	11,747	6,728	12,445
Intangible assets
IT software	14,964	-	-	-	-	-	-
Total Departmental Capital Expenditure	17,994	13,966	13,966	10,062	11,747	6,728	12,445

Statement of Objectives Specifying the Financial Performance Forecast of the Ministry

	Unit	Budget 2006/07	Estimated Actual 2006/07	Budget 2007/08
Operating Results
Revenue other	$000	16,391	16,391	10,736
Output expenses	$000	184,742	184,742	204,033
Operating surplus before capital charge	$000	183,460	183,460	202,413
Net surplus	$000	66	66	-
Closing Taxpayers’ Funds
Net current assets	$000	(12,304)	(12,304)	(7,930)
Current ratio	%	64	64	75
Average debtors outstanding	Days	100	100	114
Average creditors outstanding	Days	96	108	124
Resource Utilisation
Physical and intangible assets:
Total physical and intangible assets at end of the year	$000	32,907	32,907	36,946
Value per employee	$000	24	24	26
Additions as % of physical and intangible assets	%	42	42	27
Taxpayers’ funds:
Level at end of the Year	$000	18,498	18,498	26,911
Level per employee	$000	14	14	19
Forecast Net Cash Flows
Net cash inflow/(outflow) from operating activities	$000	28,685	28,685	11,309
Net cash inflow/(outflow) from investing activities
Net cash inflow/(outflow) from financing activities $000 (1,726) (1,726) 8,398	$000	(13,885)	(13,885)	(17,994)
Net increase/(decrease) in cash held	$000	13,074	13,074	1,713

Statement of Objectives Specifying the Performance Forecast for each Class of Outputs for the year ending 30 June 2008

The Vote Health departmental appropriations structure is changed in 2007/08. The changes to the Departmental appropriations structure are intended to provide an output focus, as recommended by the guidelines provided by The Treasury. It will also provide a stronger foundation for the review of the Ministry, as it is independent of the Ministry’s structure.

	Revenue Crown $000	Revenue Dept $000	Revenue Other $000	Total Expenses $000	Surplus/(Deficit) $000
Vote Health
Administration of Funding and Purchasing of Health and Disability Support Services	31,993	-	-	31,993	-
Administration of Legislation and Regulations	5,439	1,903	8,342	15,684	-
Funding and Performance of Crown Entities	7,982	-	-	7,982	-
Information Services	43,097	126	-	43,223	-
Payment Services	21,340	-	-	21,340	-
Servicing of Ministers and Ministerial Committees	12,886	-	-	12,886	-
Strategy, Policy and System Performance	70,560	365	-	70,925	-
Total Vote Health	193,297	2,394	8 ,342	204,033	-

Forecast Statement of Commitments as at 30 June 2008

Forecast 1/7/07 $000		Forecast 30/6/08 $000
	Operating lease commitments:
7,269	Less than one year	8,425
6,397	Between one and two years	7,725
14,508	Between two and five years	16,886
14,042	More than five years	12,883
42,216	Total Commitments	45,919

The Ministry has leases on its premises in Auckland, Hamilton, Wellington, Christchurch and Dunedin. The annual lease payments are subject to regular reviews, ranging from one year to four years. The amounts disclosed above as future commitments are based on the current rental rates.

Operating leases include lease payments for premises, computer equipment to telephone exchange system, facsimile machines and photocopiers.

The Ministry has entered into non-cancellable contracts for computer maintenance, building services and other contracts for services.

Memorandum Accounts for the year ending 30 June 2008

National Radiation Laboratory

	Balance as at 1/7/07 $000	Revenue $000	Expenses $000	Balance as at 30/6/08 $000
Licensing	225	686	(679)	232
Total	225	686	(679)	232

Licensing

A memorandum account was established in July 1998 for National Radiation Laboratory licensing activities required by the Radiation Protection Act 1965.

Forecast Statement of Trust Monies for the year ending 30 June 2008

	Balance as at 1/7/07 $000	Contribution $000	Distribution $000	Revenue $000	Expenses $000	Balance as at 30/6/08 $000
District Health Boards Deposit Trust Account	300	4,146,998	(4,147,020)	15	-	293
Total	300	4,146,998	(4,147,020)	15	-	293

The District Health Boards Deposit Trust Account was set up to hold funds received from DHBs for the delivery of processing services and disbursements.

Statement of Significant Underlying Assumptions

The forecast financial statements have been prepared on the basis of government policies, and in accordance with the Ministry’s Output Plan with the Minister of Health.

The Statement of Intent incorporates the Government’s decisions to date on the devolution to DHBs of a range of rights and obligations under service funding agreements and statutory notices.

Statement of Significant Accounting Policies:Departmental

Reporting entity

The Ministry of Health is a government department as defined by section 2 of the Public Finance Act 1989.

These are the forecast financial statements of the Ministry of Health prepared pursuant to section 38 of the Public Finance Act 1989.

Measurement system

The forecast financial statements have been prepared on a historical cost basis, modified by the revaluation of certain fixed assets.

Revenue

The Ministry derives revenue through the provision of outputs to the Crown for services to third parties. Such revenue is recognised when earned and is reported in the financial period to which it relates.

Cost allocation

The Ministry has determined the cost of outputs using a cost allocation system that is outlined below.

Cost allocation policy: Direct costs are charged directly to significant activities. Indirect costs are charged to significant activities based on cost drivers and related activity/usage information.

Criteria for direct and indirect costs: ‘Direct costs’ are those costs directly attributed to an output.‘Indirect costs’ are those costs that cannot be identified in an economically feasible manner with a specific output.

Direct costs assigned to outputs: Direct costs are charged directly to outputs. Depreciation is charged to business units on the basis of asset utilisation with the balance being charged as indirect costs. Direct personnel costs are allocated directly to the output expenses with the balance being charged as indirect costs.

Basis for assigning indirect and corporate costs to outputs: Indirect costs (corporate services)are allocated over the output expenses, based on the proportion of full-time equivalent staff and contracts, and funding per output.

Debtors and receivables

Receivables are recorded at estimated realisable value after providing for doubtful and uncollectable debts.

Operating leases

Leases where the lessor effectively retains substantially all the risks and benefits of ownership of the leased items are classified as operating leases. Operating lease costs are recognised on a systematic basis over the period of the lease.

Property, plant and equipment

Land and buildings are stated at fair value as determined by an independent registered valuer. Fair value is determined using market-based evidence. Land and buildings are revalued at least every three years. Additions to fixed assets between revaluations are recorded at cost.

The results of revaluing land and buildings are credited or debited to an asset revaluation reserve for that class of asset. Where a revaluation results in a debt balance in the revaluation reserve, the debit balance will be expensed in the Statement of Financial Performance.

All other fixed assets, or group of assets (other than IT equipment) that are material in aggregate,costing more than $4,000 are capitalised and recorded at cost. IT equipment costing more than$1,000 is capitalised and recorded at historical cost. Any write-down of an item to its recoverable amount is recognised in the Forecast Statement of Financial Performance.

Intangible assets

All purchased intangible assets are initially recorded at cost, and thereafter at either cost less any accumulated depreciation and any accumulated impairment losses, or where an active market exists, a revalued amount, being fair value at the date of the revaluation less any subsequent accumulated depreciation and any subsequent accumulated impairment losses.

All capitalised development costs from internally generated intangible assets are amortised through the Statement of Financial Performance over the period of expected benefit.

Where the capitalised development costs of a project exceed the amount that is recoverable from related future economic benefits, the excess will be expensed.

Depreciation

Depreciation of fixed assets, other than work in progress and freehold land (which are not depreciated), is provided on a straight-line basis so as to allocate the cost (or valuation) of assets,to their estimated residual value, over their useful lives.

The useful lives of major classes of assets and associated depreciation rates have been estimated as follows:

Class of assets	Useful life	Depreciation rate
Buildings	40 years	2.5%
Motor vehicles	3–5 years 2	0–33.3%
Furniture and fittings	5–10 years	10–20%
Machinery	5 years	20%
Leasehold improvements	5–10 years	10–20%
IT equipment	3 years	33.3%
Scientific equipment	5 years	20%
IT software	3–5 years	20%–33.3%

The cost of leasehold improvements is capitalised and depreciated over the unexpired period of the lease or the estimated remaining useful lives of the improvements, whichever is the shorter.

Work in progress is not depreciated. The total cost of work in progress is transferred to the appropriate asset class on its completion and then depreciated.

Employee entitlements

Provision is made in respect of the Ministry’s liability for annual leave, long-service and retirement leave and time off in lieu. Annual leave, time off in lieu and other entitlements that are expected to be settled within 12 months of reporting date, are measured at nominal values on an actual entitlement basis at current rates of pay.

Entitlements that are payable beyond 12 months, such as long-services and retirement leave, have been calculated on an actuarial basis on present value of expected future entitlements.

Payables

These are payments due to suppliers for good and services received at balance date but not yet paid for. They are recorded at the estimated obligation to pay.

Forecast statement of cash flows

Cash means cash balances on hand, held in bank accounts, and deposits with the New Zealand Debt Management Officer (NZDMO).

Operating activities include cash received from all income sources of the Ministry and record the cash payments made for the supply of goods and services.

Investing activities are those activities relating to the acquisition and disposal of non-current assets.

Financing activities comprise capital injections by, or repayment of the capital and surplus to, the Crown.

Financial instruments

The Ministry is party to financial instruments as part of its normal operations. These financial instruments include bank accounts, short-term deposits, debtors and creditors. All financial instruments are recognised in the Forecast Statement of Financial Position and all revenues and expenses in relation to financial instruments are recognised in the Forecast Statement of Financial Performance.

Except for those items covered by a separate accounting policy all financial instruments are shown at their estimated fair value.

Goods and services tax (GST)

The Forecast Statement of Financial Position is exclusive of GST except for Creditors and Payables and Debtors and Receivables, which are GST inclusive. All other forecast statements are GST exclusive.

The amount of GST owing to or from the Inland Revenue Department at balance date, being the difference between output GST and input GST, is included in Creditors and Payables or Debtors and Receivables (as appropriate).

Taxation

Government departments are exempt from the payment of income tax in terms of the Income Tax Act 2004. Accordingly, no charge from income tax has been provided for.

Commitments

Future expenses and liabilities to be incurred on contracts that have been entered into at balance date are disclosed as commitments to the extent that there are equally unperformed obligations.

Contingent liabilities

Contingent liabilities are disclosed at the point at which the contingency is evident.

Taxpayers’ funds

The Crown’s net investment in the Ministry is shown as taxpayers’ funds.

Changes in accounting policies

These forecast financial statements to 30 June 2008 have been prepared in accordance with New Zealand International Financial Reporting Standards (NZIFRS).

There have been no significant changes in accounting policies on transition to NZIFRS. The changes relate to the introduction of ‘intangible assets’ accounting policy, and the restating of the value of the Ministry’s fixed asset values, removing the ‘revaluations reserve’.

Schedule of Non-Departmental Appropriations for the year ending 30 June 2008

The Schedule of Non-Departmental Appropriations details appropriations administered by the Ministry on behalf of the Crown. Figures are GST exclusive where applicable.

	Budget 2006/07 $000	Estimated Actual 2006/07 $000	Budget 2007/08 $000
Vote Health
Non-Departmental Output Expenses
Health and Disability Support Services:
Northland DHB	332,758	332,758	357,455
Waitemata DHB	841,754	841,754	948,821
Auckland DHB	808,100	808,100	839,868
Counties Manukau DHB	799,410	799,410	857,753
Waikato DHB	661,792	661,792	715,230
Lakes DHB	208,093	208,093	219,328
Bay of Plenty DHB 4	17,799	417,799	450,604
Tairawhiti DHB	103,625	103,625	107,134
Taranaki DHB	224,352	224,352	240,566
Hawke’s Bay DHB	314,470	314,470	334,875
Whanganui DHB	145,386	145,386	159,807
MidCentral DHB	329,110	329,110	350,926
Hutt DHB	255,901	255,901	267,101
Capital and Coast DHB	478,106	478,106	509,514
Wairarapa DHB	88,616	88,616	93,826
Nelson-Marlborough DHB	275,079	275,079	294,045
West Coast DHB	90,215	90,215	94,866
Canterbury DHB	920,154	920,154	960,146
South Canterbury DHB	116,589	116,589	128,002
Otago DHB	378,444	378,444	397,813
Southland DHB	212,137	212,137	223,091
Total Health and Disability Support Services for DHBs	8 ,001,890	8 ,001,890	8 ,550,771
Clinical Training Agency	-	-	103,612
Health services funding	116,605	116,605	291,833
Management of residential health liabilities and Crown health enterprise debt	1,674	1,674	1,755
Meningococcal vaccine programme	7,730	7,730	6,765
Monitoring and protecting health and disability consumer interests	12,991	12,991	14,076
National advisory and support services	340	340	340
National child health services	-	-	28,768
National contracted services – other	-	-	140,508
National disability support services	755,908	753,658	859,563
National elective services	-	-	201,037
National emergency services	-	-	66,611
National Maori health services	-	-	9,245
National maternity services	-	-	108,661
National mental health services	-	-	63,169
National services	539,681 x	539,681 536,619	-
Problem gambling services	20,324	20,324	17,289
Public health service purchasing	328,795	327,495	396,435
Scientific advice to support pest management strategies as they affect public health	53	53	53
Total Appropriations for Non-Departmental Output Expenses	9,785,991	9,779,379	10,860,491
Other Expenses to be Incurred by the Crown
Australian Kidney Foundation	15	15	15
International health organisations	2,230	2,230	2,230
Legal expenses	10,287	10,287	1,778
Provider development	13,889	13,889	13,889
Total Appropriations for Other Expenses to be Incurred by the Crown	26,421	26,421	17,912
Capital Expenditure Deficit support for DHBs	38,000	38,000	-
Equity for capital projects for DHBs and the New Zealand Blood Service	42,984	26,926	250,824
Health sector projects	21,177	21,177	-
New lending to DHBs	181,047	180,600	109,200
Refinancing of DHB private debt	-	-	70,000
Residential care loans	20,000	10,718	20,000
Response to significant health emergencies	20,230	20,230	3,524
Rollover of Residual Health Management Unit loans	92,253	92,253	392,719
Total Appropriations for Capital Expenditure	415,691	389,904	846,267
Total Non-Departmental Appropriations	10,228,103	10,195,704	11,724,670

Schedule of Forecast Non-Departmental Revenue andCapital Receipts for the year ending 30 June 2008

The Schedule of Non-Departmental Revenue and Capital Receipts details non-departmental revenues and receipts the Ministry collects on behalf of the Crown. As these revenues are not established by the Ministry nor earned in the production of the Ministry’s outputs, they are not reported in the Ministry’s forecast financial statements.

	Budget 2006/07 $000	Estimated Actual 2006/07 $000	Budget 2007/08 $000
Current Revenue
Reimbursement from Accident Compensation Corporation:
ACC – Reimbursement of Complex Burns Costs	6,300	6,300	3,000
ACC – Reimbursement of Work-related Public Hospital Costs	19,662	19,662	19,662
ACC – Reimbursement of Non-Earners Account	185,180	185,180	185,180
ACC – Reimbursement of Self-Employed Public Hospital Costs	5,368	5,368	5,368
ACC – Reimbursement of Earners’ Non-work-related Public Hospital Costs	56,358	56,358	56,358
ACC – Reimbursement of Medical Misadventure Costs	1,716	1,716	1,716
ACC – Reimbursement of Motor Vehicle-related Public
Hospital Costs	46,687	46,687	46,687
Total ACC Reimbursements	321,271	321,271	317,971
Payment of Capital Charge by DHBs	199,709	199,709	199,709
Net Surplus from DHBs	(10,200)	(10,200)	-
Residual Health Management Rental	278	278	278
Total Current Revenue	511,058	511,058	517,958
Capital Receipts Repayment of Residential Care Loans	24,000	24,000	24,000
Repayment of Equity by DHBs	49,445	49,445	49,445
Total Capital Receipts	73,445	73,445	73,445
Total Revenue and Capital Receipts	584,053	584,053	591,403

Schedule of Estimated Non-Departmental Assets for the year ending 30 June 2008

The Schedule of Non-Departmental Assets details the assets administered by the Ministry on behalf of the Crown.

	Budget 2006/07 $000	Estimated Actual 2006/07 $000	Budget 2007/08 $000
Current Assets
Cash	55,074	95,353	94,584
Debtors:
District Health Boards	12,112	7,870	7,216
Others	85,547	80,507	77,161
Inventory	50,978	49,780	50,978
Total Current Assets	203,711	233,510	229,939
Non-Current Assets
Investments	1,585,492	1,423,131	1,783,155
Advances – Residential Care Loans	70,811	70,811	70,811
Total Non-Departmental Assets	1,860,014	1,727,452	2,083,905

Schedule of Estimated Non-Departmental Liabilities for the year ending 30 June 2008

The Schedule of Non-Departmental Liabilities details the liabilities administered by the Ministry on behalf of the Crown.

	Budget 2006/07 $000	Estimated Actual 2006/07 $000	Budget 2007/08 $000
Current Liabilities
Payables and Provisions:
Crown Entities	3,867	3,867	3,867
Others	6,745	6,745	6,745
Accrued Expenses:
Crown Entities	423	423	423
Others	352,984	352,984	352,984
Total Non-Departmental Liabilities	364,019	364,019	364,019

Statement of Significant Accounting Policies for Non-Departmental Schedules

Reporting entity

The forecast financial information for the Crown Vote Health has been prepared by the Ministry of Health and presents the public funds managed by the Ministry that are not incorporated in its forecast schedules.

The Ministry is responsible for an effective and efficient management of revenue, expenditure,assets and liabilities on behalf of the Crown. These have been produced pursuant to section 38 of the Public Finance Act 1989.

Measurement system

The forecast non-departmental schedules have been prepared on a historical cost basis.

Revenue and receipts

Revenue from ACC recoveries and capital charges from DHBs is recognised when earned and is reported in the financial period to which it relates.

Debtors and receivables

Receivables from ACC recoveries are recorded at the value of the contract with ACC. Receivables from capital charges are recorded at estimated realisable value.

Advances

Advances are recorded at cost to providers of residential care.

Investments

Investments are recorded at cost of capital contributions, adjusted by the revaluation of land and buildings and the net worth of Crown entities at the year end.

Payables and provisions

Payables and provisions are recorded at the estimated obligation to pay.

Accrued expenses

Accrued expenses are recorded at the value of funding entitlements owning under the Crown Funding Agreements and the estimated value of the contracts started but not completed.

Financial instruments

Crown Vote Health is party to financial instruments as part of its normal operations. These financial instruments include bank accounts, short-term deposits, debtors and creditors. All financial instruments are recognised in the Schedules of Estimated Non-Departmental Assets and Estimated Non-Departmental Liabilities and all revenues and expenses in relation to financial instruments are recognised in the Forecast Schedules of Non-Departmental Revenue and Non-Departmental Expenses.

Goods and services tax (GST)

The Forecast Schedule of Non-Departmental Assets and Liabilities is exclusive of GST except where creditors and payables and receivables, which are GST inclusive. All the other forecast schedules are GST exclusive.

The Crown does not pay GST to Inland Revenue, except for ACC revenues received. The representative amount of GST owning at balance date is included in the creditors and payables.

Statement of Forecast Service Performance

Statement of objectives

The generic quantity, quality and timelines performance measures for all policy advice and briefings supplied by the Ministry of Health follow.

Quantity

Policy advice and briefings will be supplied on the basis agreed between the Minister of Health and the Director-General of Health. Unanticipated briefing requests will be supplied to the minister as requested. Quality Policy advice will comply with the Ministry of Health’s standards for policy advice. Briefings an advice will:

• be clear, concise and logical
• be factually accurate, practical and complete
• have a clear statement of purpose
• be presented in the correct format
• consider options and implications
• consider legal, financial and health service implications
• meet Cabinet Office requirements where relevant
• comment on intersectoral implications
• be peer reviewed
• follow quality processes for briefings, recorded through the use of audit trails.

The quality assurance procedures followed for ad-hoc ministerial advice will depend on the type of advice and the timeframe in which it is requested. All advice will be signed out in accordance with delegated authority.

• Feedback from Cabinet office on compliance with standards for Cabinet papers.
• Peer review to ensure that standards for policy advice are met.
• Feedback from the Minister on specific advice tendered.
• Regular meetings between the Minister and senior staff, and quarterly reports to the Minister on the Ministry’s progress against project outputs.

Timeliness

Timeframes for policy projects will be met as agreed between the Minister of Health and the Ministry, unless modified with the Minister’s agreement. Short-term and ad hoc ministerial requests will be supplied within the required timeframes. The Ministry manager who is responsible for preparing the request monitors timeliness.

Cost

The out-turn for the year is within budget, in accordance with the Financial Statement of Objectives.

Departmental Output Expense: Administration of funding and purchasing of health and disability support services on behalf of the Crown

This output expense provides interventions planned by the Ministry to deliver on a core operating function for the Ministry, that is funding and purchasing of health and disability support services on behalf of the Crown.

The planned interventions allow funding and purchasing of some health and disability support services, the roll out of the national foundation certificate for home-based support service workers,and post-clinical education and training.

The services funded and purchased will include some disability support services, public health services, specified screening services, mental health services, national personal health services and Maori health services.

In relation to these services, this departmental output expense provides for the Ministry to:

• plan for and undertake developments to improve the benefit of services funded by the Ministry of Health, including cross-agency co-operation and collaboration where appropriate
• fund services, including negotiating service agreements, provider audit and monitoring against contracts and national quality standards
• pay claims from people with a disability
• ensure the effective utilisation of services funding and analyses expenditure and service trends to inform budget monitoring.

Performance measures

Disability support services

The Ministry will plan and fund disability support services specific to people with sensory, physical or intellectual disabilities (generally under 65 years old). This includes funding services such as community residential services, home support, respite, carer support and environmental support services. Performance against an estimated 1200 service agreements will be monitored including(if applicable) the promotion of service quality in the health and disability workforce.

The Ministry will ensure consumer and provider participation in developing and improving disability support services including nationwide consumer forums, representation of consumers on advisory groups and selection panels, and provider networks including Maori provider networks.

The Ministry will implement ongoing development and enhancement programmes to improve disability support services including:

• Environmental Support Services – accessibility and eligibility issues
• Autism Spectrum Disorder (ASD) services including release and impact assessment of the ASD guidelines
• workforce development for targeted groups such as home-based support service (HBSS) workers and needs assessment and service co-ordination (NASC)
• transparent and fair funding models
• implementing a disability information system for NASCs.

Public health

Performance against an estimated 450 service agreements relating to public health will be monitored including collaborative planning and purchasing of Public Health Programmes from DHBs, NGOs and Crown Entities to:

• strengthen the national alignment group model
• adapt public health services to the diversity of needs in the DHBs
• change the contracting approach to one of partnership – and for DHB public health funding,including public health unit activity, to be part of the Crown Funding Agreement.

National Screening Programme

Performance against an estimated 100 service agreements for the delivery of national screening programmes will be monitored.

Mental health

The Ministry will plan, fund, purchase, monitor and evaluate 102 contracts of mental health and addiction services in workforce development, research and development, provision of sector intelligence, problem gambling, alcohol and other drug services and primary mental health initiatives as part of implementing Te Ko¯kiri.

Non-devolved health and disability services

The Ministry will fund and purchase of a range of non-devolved personal health and clinical training services and contract the components of the child and adolescent oral health workstream, including the Clinical Training Agency.

The Ministry will also administer:

• the High Cost Treatment Pool (HCTP)
• the contract with the Central Northern Adelaide Health Service, Australia, providing the administration and management of the Australia and New Zealand Dialysis and Transplant Registry (ANZDATA), the Australia and New Zealand Organ Donor Registry (ANZOD) and the Living Kidney Donor Registry (LKDR).

The Ministry will implement the agreed hepatitis C no-fault proposal.

All service agreements will be managed in accordance with the Ministry’s contracting standards.

A quarterly report will be provided to the Minister on the Ministry’s performance as a funder in relation to the service agreements as specified.

Administration of the Maori Provider Development Scheme

Decisions on the allocation of funds will be in line with guidelines. The relevant DHB and Maori provider organisations will be involved in decisions where appropriate. Funds will be allocated to successful applicants across four categories. Requests for applications, assessments, advice and payment of funds will meet the timeframes stated for the 2006/07 funding round.

Administration of funding and purchasing of health and disability support services

Year	Revenue Crown $000	Revenue Department $000	Revenue Other $000	Total Expense $000
2007/08	31,993	-	-	31,993
2006/07	-	-	-	-

Departmental Output Expense: Administration of legislation and regulations

This output expense provides interventions planned by the Ministry to deliver on a core operating function for the Ministry, that is administration of legislation and regulations and meeting legislative requirements.

These interventions are to administer and enforce statutory obligations, and meet health-specific legislative requirements that include:

• promoting improvement in public health and safety through statutory obligations set out in the Health Act 1956 (and to be strengthened by the development of the Public Health Bill), the Radiation Protection Act 1965, the Medicines Act 1981, and other public health statutes that provide for communicable disease control, and environmental health (including border control)
• leading the whole of government response in preparing for, and responding to, health emergencies requiring a government (national) response as described in the Civil Defence and Emergency Management Act 2002
• discharging the obligations and meet the health-specific requirements of statutes
• implementing Te Kokiri through the administration of legislative and statutory obligations and the protection of human rights for those affected by mental illness
• promoting continuous improvement in providing safe and quality-focused health and disability services through statutory obligations set out in the Health and Disability Services (Safety) Act 2001
• promoting improvement in health and disability outcomes for people with intellectual disability through statutory obligations set out in the Intellectual Disability (Compulsory Care and Rehabilitation) Act 2003
• maintenance and review of the regulatory framework for quality and safety.

Performance measures

Radiation protection services and emergency management

The Ministry will:

• provide an emergency response service 24 hours, seven days a week with regards to the harmful effects of ionising and non-ionising radiations
• provide training for those who respond to incidents involving ionising radiations, at a frequency and level determined by consultation with emergency response services
• publish the Annual Report on Environmental Radioactivity Monitoring in 2007.

The delivery of the Ministry’s emergency management responsibilities (derived from the Civil Defence and Emergency Management Act 2002) will be measured through monitoring the delivery of the Ministry’s Emergency Management Work Programme. This will include monitoring the progress on projects planned for completion in 2007/08, emerging issues and emergency management workstreams continuing into out years.

Environmental health, including border control and drinking-water

• Drinking-water quality management capacity building programmes started in six Pacific Islands.
• International ship sanitation regime implemented.
• A health support service framework developed for dioxin-exposed populations.
• Two hundred small water supplies are involved in the technical assistance programme.
• Revised lead, spray drift, asbestos guidelines will be provided to DHB public health units.
• Implementation of Government’s decision on the sanitary works subsidy scheme.
• Health protection practitioner competency framework promulgated to DHBs.
• Training designated officers to dispense their statutory obligations.

Regulation of medicines and medical devices and establishment of the ANZTPA and a new joint regulatory scheme with Australia

Approximately 1525 new and changed medicines will be evaluated for their safety, effectiveness and quality.

Approximately 43 audits will be undertaken for licences to manufacture medicines and licences to pack as required under the Medicines Act 1981, wholesalers, retailers, pharmacies, companies possessing and dealing in controlled drugs.

The Ministry will:

• investigate complaints about medicine quality and breaches of the legislation
• monitor adverse reactions to medicines and provide updated prescribing advice
• evaluate and approve/reject clinical trial applications
• monitor aberrant prescribing
• enforce border control activities
• develop a new regulatory scheme to be administered by ANZTPA
• provide regulatory advice for the complementary medicines and medical devices sector to enable them to understand the new requirements and facilitate their transition into the new scheme.

Administration of mental health legislation

Produce the Office of the Director of Mental Health’s annual report and produce statistics on the use of Electroconvulsive Therapy annually by 30 June 2007.

Administering public health legislation

• Report produced on the public health role of local government by 30 June 2008.
• Train statutory officers for legislative functions relating to public health.
• Public Health Bill select committee report back (contingent on LEG and introduction in April 2007).

HealthCert

The Ministry will review work carried out by designated audit agencies to ensure compliance with the standards that are approved under the Health and Disability Services (Safety) Act 2001.

• Certificates will be issued within 15 working days of receiving all the information that is required.
• Complaints will be responded to within seven working days of receipt.
• Reports will be completed within 15 working days of an investigation audit being completed and obtaining all relevant information.

Administration of legislation and regulations

Year	Revenue Crown $000	Revenue Department $000	Revenue Other $000	Total Expense $000
2007/08	5,439	1,903	8,342	15,684
2006/07	-	-	-	-

Departmental Output Expense: Funding and performance of Crown entities

This output expense provides interventions planned by the Ministry to deliver on a core operating function for the Ministry, that is achieving the Ministry’s outcomes at the system and societal level by providing advice on the ownership and performance of Crown entities.

DHB and Crown entity ownership advice

• Developing funding advice to DHBs, incorporating interdistrict flows, and National Pricing and the population-based funding formula.
• Developing funding advice to other Crown health entities.
• Developing the planning and reporting requirements for DHBs and other Crown entities,managing the DHBs’ Crown Funding Agreements, and reviewing the performance reports on each DHB and other Crown entities.
• Advice on the performance of DHBs and other Crown health entities in delivering the Government’s New Zealand Health Strategy and New Zealand Disability Strategy.
• Advice on ministerial appointments to the governing bodies of the DHBs and other Crown entity boards and on the expectations of board members.
• Advice on industrial relations across the sector.
• Advice on best practice and policy for DHB elections, and assisting DHBs to meet their legislative obligations around DHB elections.
• Support and training for Maori participation in DHB decision-making.
• Leading the negotiations working towards the resolution of contemporary Treaty of Waitangi claims.
• Co-ordination of sector capital investment plans through the National Capital Committee and the assessment and management of sector capital business cases.
• Advice on governance issues affecting DHBs and other Crown entities, including conflicts of interest, succession planning, codes of conduct, delegation policies and approvals for co-operative and collaborative arrangements.

DHB and Crown entity performance management

• Using the Monitoring Intervention Framework (MIF) for evaluating, recognising and encouraging improved DHB performance.
• Assisting DHB boards with the resolution of governance issues affecting board performance and the promotion of best governance approaches.
• Reviewing ongoing financial and non-financial performance of DHBs and Crown entities and the consideration of any appropriate interventions to achieve performance improvement.
• Aligning DHB accountability and monitoring arrangements with the work of the performance management and assessment steering group.

Performance measures

Quantity

The Ministry, via the National Pricing Programme (NPP), will provide analytical resources and project management support so that a National Price Book is produced, including a revised tertiary adjuster, in time for the 2007 funding programme. The NPP allows for a common process to develop national prices and hospital benchmarking information in a co-ordinated manner,reducing transaction costs in the sector and improving productivity through the development of best practice tools.

The Ministry will maintain the Nationwide Service Framework so that the sector can take a consistent approach to methodologies and processes when analysing, funding and monitoring services.

The Ministry will provide input in Pay and Employment Equity initiatives to ensure that sector views are considered.

The Ministry will provide support, advice and information to DHBs to assist them to implement their Pay and Employment Equity action plans.

Advice will be provided to the Minister regarding the 21 DHB District Annual Plans.

The Ministry will conduct focused publicity campaigns aimed at encouraging candidates to stand for DHB elections and for the public to vote that allows for representation that better reflects the composition of DHBs’ populations.

The Ministry will provide advice to the Minister on the 2007 DHB elections, including a break down of successful candidates, and recommendations for future election.

The Ministry will conduct a centralised induction of board members.

Advice with recommendations on any changes to the PBFF will be provided to the Minister of Health.

Advice with recommendations on 2008/09 service agreements will be prepared for the Minister of Health.

An evaluation of options to investigate a different method of collecting monthly financial information will be complete.

Quality

Advice will be provided in accordance with the Statement of Objectives.

A survey of sector representatives shows satisfaction with the process and outcome of the review of DHB accountability arrangements.

Timeliness

Formal Monitoring Intervention Framework response occurs within eight weeks of confirmed material deterioration in performance to ensure reasons for deterioration are identified and corrective action taken.

Funding and performance of Crown entities

Year	Revenue Crown $000	Revenue Department $000	Revenue Other $000	Total Expense $000
2007/08	7,982	-	-	7,982
2006/07	-	-	-	-

Departmental Output Expense: Information services

This output expense provides interventions planned by the Ministry to deliver on a core operating function for the Ministry.

These interventions provide for the collection and analysis of health information, including:

• Health Information and Strategy – custodianship of the Health Information Strategy for New Zealand (HIS-NZ).
• National Collections – custodianship and operational responsibility for national collections of health and disability information on behalf of New Zealanders.
• Health Records – custodianship and operational responsibility for national health event summaries on behalf of all New Zealanders.
• Data Quality and Analysis – the collection, processing, maintenance, analysis and dissemination of health data, public health intelligence (PHI), statistics and information including strategies to improve data quality and methods to improve data analysis.
• Information Access – responsibility for provisioning health information to the sector and appropriate information to wider stakeholders.
• National Systems – the maintenance and ongoing development of key national systems.
• Anchoring Framework – the maintenance and ongoing development of national indexes (ie,National Health Index and Health Practitioner Index) to ensure connectivity to data stored across national collections.

Performance measures

National Health Information Services		2005/06 Actual	2007/08 Estimate
Quality	Development, maintenance and continuous improvement of key national collections systems.	Quarterly	Quarterly
	Data loads for mental health information national collection (MHINC), breast cancer screening &treatment (BCST), national minimum data set (NMDS) and national booking review system (NBRS) are processed (within 2 days of receipt).	2 days	2 days
	Availability of national health index (NHI) reporting to the sector.	Monthly	Monthly
Quantity	Progressively populate Health Practitioner Index (HPI) with practitioner level data from contracted registration authorities.	N/A	100% pa
	Utilising data collected and stored within national collection system to deliver a minimum of six statistical health information published publications.	7	6
	The national health index (NHI) & medical warning system (MWS) availability (of time).	98%	98%
	Register cancers reported to NZHIS in accordance with the NZ Cancer Registry Act 1993 and Cancer Registry Regulations 1994.	New	100%
	Code underlying cause of deaths for deaths and stillbirths registered in New Zealand, that are reported to NZHIS.	New	28,500 pa
Timeliness	Requests for information from the clinical coding helpdesk are delivered as agreed with clients.	64%	95%
	National health index (NHI) technical help desk availability. 24/7 24/7 Request for information from client stakeholders are delivered as agreed with clients.	95%	95%
National Systems Development Programme		2005/06 Actual	2007/08 Estimate
Quality Quantity Timeliness	Project outputs will meet quality standards, timelines and costs as set out in the project plans as agreed between the Minister and Ministry.	New	Completed within timeframe

Information services

Year	Revenue Crown $000	Revenue Department $000	Revenue Other $000	Total Expense $000
2007/08	43,097	126	-	43,223
2006/07	-	-	-	-

Departmental Output Expense: Payment services

This output expense provides for the administration and monitoring of service agreements and payments for health benefits and service agreements.

These services include:

• payment and administration of agreements
• payments to health providers for contracted services
• payment clinical data collection from health provider claims
• provision of information and reports relating to payment and other health data
• audit and counter-fraud methodologies to ensure that health funds are applied legitimately and appropriately
• patient eligibility administration.

Heath sector payments and administration		2005/06 actual	2007/08 estimate
Quality	Claims (including capitation) and invoices processed and paid.	70,000,221	90,000,000
	Agreements produced and processed.	10,181	11,000
	Monitoring reports loaded into the contract management system.	13,974	14,000
	Applications for eligibility processed.	238,777	280,000
Timeliness	Percentage of applications for eligibility processed within agreed timeframes.	100%	100%
	Percentage of correct claims and invoices will be paid within agreed timeframes.	99%	100%
	Percentage of client calls answered successfully(measured as an abandonment rate of no greater than 5 percent) by the call centre.	64%	95%
	Percentage of approved agreements issued to providers within five working day of approval.	99%	99%
Quality	An audit programme will be conducted as specified in the Ministry of Health – District Health Boards’ Memoranda of Understanding and monitored by the Information Liaison Group.
	A Memorandum of Understanding with the DHBs will be undertaken.
	Agreements will be peer reviewed prior to issuing to providers.
	Payments of claims and invoices will be according to business rules within agreements.

Payment services

Year	Revenue Crown $000	Revenue Department $000	Revenue Other $000	Total Expense $000
2007/08	21,340	-	-	21,340
2006/07	-	-	-	-

Departmental Output Expense: Servicing of Ministers and Ministerial committees

This output expense provides interventions planned by the Ministry to deliver on a core operating function for the Ministry, that is to provide Servicing of the Minister of Health, Associate Ministers of Health and Parliament. This includes:

• advice to ministers not related to interventions planned for the other departmental output expenses but which is either requested by ministers or is of such significance that a minister would be at risk if s/he was not briefed on the matter at hand
• the preparation of draft responses to ministerial correspondence, parliamentary questions,requests for briefing reports and speeches, the provision of replies to questions asked by the Health Committee in respect of the Estimates and Financial Review examinations,appointments to ministerial and occupational statutory bodies and committees, responses to petitions, select committee inquiries, and acting as advisor to select committees in their consideration of bills
• the provision of administrative and advisory services to Ministerial advisory committees serviced by the Ministry.

Performance measures

Policy advice

Quantity	Quality	Timeliness
As agreed between the Minister and the Ministry.	All advice and briefings will meet the quality standards set out in the Statement of Objectives.	Advice and briefings completed within the requested time frame.

Ministerial correspondence

This output concerns the provision of draft replies to Ministerial correspondence received by the Minister of Health and the Associate Ministers of Health.

Quantity	Quality	Timeliness
Provision of an estimated 4500 draft replies.	All draft replies peer reviewed and signed out in accordance with delegated authority.	90% of draft replies completed within 10 or 20 working days as requested.
	93% of replies signed off at first draft.

Parliamentary Questions

This output concerns the provision of draft replies to oral and written Parliamentary Questions for the Minister of Health and the Associate Ministers of Health.

Quantity	Quality	Timeliness
Provision of an estimated 3000 draft replies to Parliamentary Questions	All draft replies peer reviewed and signed out in accordance with delegated authority.	100% of draft replies to Questions completed within the required time frame.

Briefing papers and preparation of speeches

This output concerns the provision of briefing papers and draft speeches to the Minister of Health and Associate Ministers of Health.

Quantity	Quality	Timeliness
Provision of an estimated 500 briefing requests and speech requests from the Minister of Health	All advice and briefings will meet the quality standards for the provision of policy advice and briefings set out in the Statement of Objectives.	100% completed within the required time frame.
	All draft replies peer reviewed and signed out in accordance with delegated authority.

Official Information requests

This output concerns the provision of advice on the interpretation and application of the Official Information Act 1982 and the provision of draft replies to requests for official information received by the Minister of Health, Associate Ministers of Health and the Director-General of Health.

Quantity	Quality	Timeliness
Provision of an estimated 850 responses to requests for official information	All decisions made in accordance with the provisions of the Official Information Act 1982.	100% of requests for Official Information completed within the required time frame.
	All draft replies peer reviewed and signed out in accordance with delegated authority.

Select Committee requests

This output concerns the provision of written responses to written questions from the Health Committee relating to the Financial Review and Estimates examinations.

Quantity	Quality	Timeliness
Provision of 350 responses to written questions from the Health Committee relating to the Financial Review and Estimates examinations	All draft replies peer reviewed and signed out in accordance with delegated authority.	100% of written responses provided within the time frame requested by the Minister of Health and the Health Committee.
Provision of advice and written reports to select committees	All draft replies peer reviewed and signed out in accordance with delegated authority.	Within the time frame requested by Select Committee.

Appointments to Ministerial committees and statutory bodies and committees

This output concerns the provision of support services to the Minister of Health in respect of his appointments to the following Ministerial committees and statutory bodies and committees.

• Advisory Committee on Assisted Reproductive Technology
• Cancer Control Council of New Zealand
• Child and Youth Mortality Review Committee
• Ethics Committee on Assisted Reproductive Technology
• Health Information Strategic Action Committee
• Health Practitioners Disciplinary Tribunal
• Medical Council of New Zealand
• Medical Laboratory Science Board
• Medical Radiation Technologists Board
• Medicines Adverse Reactions Committee
• Medicines Classification Committee
• Medicines Review Committee
• Mental Health Commission
• Midwifery Council
• Health and Disability Ethics Committees
• National Health Committee
• National Kaitiaki Group
• New Prescribers Advisory Committee
• Nursing Council of New Zealand
• National Ethics Advisory Committee
• Occupational Therapy Board Optometrists and Dispensing Opticians Board
• Osteopathic Council
• Perinatal and Maternal Mortality Review Committee
• Pharmaceutical Management Agency
• Pharmacy Council
• Physiotherapy Board
• Plumbers, Gasfitters and Drainlayers Board
• Podiatrists Board of New Zealand
• Psychologists Board
• Public Health Advisory Committee
• Radiation Protection Advisory Council
• Quality Improvement Committee (formerly EpiQual)

Quantity	Quality	Timeliness
An estimated 200 appointments.	All appointments to Ministerial Committees and Statutory Bodies and Committees made in accordance with the New Zealand Public Health and Disability Act 2000 and DPMC and SSC requirements.	90% of appointments to statutory bodies and committees made prior to expiry of the term of appointment, except where the incumbent ceases to hold office prior to the expiry of their term.

Statutory and Ministerial Advisory Committee Support

Quantity and quality

The Ministry will provide secretariat support to the following committees in accordance with Ministry standards and committee expectations in accordance with the committee’s annual workplans:

• Cancer Control Council of New Zealand
• Quality Improvement Committee
• Child and Youth Mortality Review Committee
• Perinatal and Maternal Mortality Review Committee
• National Ethics Advisory Committee
• New Prescribers Advisory Committee
• Advisory Committee on Assisted Reproductive Technology
• Ethics Committee on Assisted Reproductive Technology
• National Health Committee
• Public Health Advisory Committee
• Health and disability ethics committees
• Health Information Strategic Action Committee
• National Screening Advisory Committee
• National Kaitiaki Group.

Timeliness

All milestones and timeframes as agreed between the statutory and ministerial committees and the Minister in annual work plans will be met.

Servicing of Ministers and Ministerial Committees

Year	Revenue Crown $000	Revenue Department $000	Revenue Other $000	Total Expense $000
2007/08	12,886	-	-	12,886
2006/07	-	-	-	-

Departmental Output Expense: Strategy, policy and system performance

This output expense provides interventions planned by the Ministry to achieve progress on the current priorities of chronic disease, child and youth services, elective services, primary healthcare, health of older people, infrastructure and value for money.

Reducing inequalities is a focus in each of these priorities to meet the Government’s expectations that the Ministry leads the ‘Better Health for All’ sub theme of the ‘Families – young and old’ theme in its transformative social policy.

This output expense also provides interventions to develop the long-term sector strategic plan and monitoring the performance of the health system.

Performance measures

Minister’s priorities

Reducing inequalities

Four workshops, with a particular focus on the four regional cancer networks, will be conducted by 30 June 2008 to raise awareness of the need to reduce inequalities.

The Health Equity Assessment Tool with be reviewed by 30 June 2008 and a guide to its use will be developed to improve its uptake.

The Pacific Health and Disability Action Plan will be reviewed by 29 February 2008 and implementation of the action plan for the next period will commence to improve Pacific health and to reduce inequalities.

Chronic disease

• The Healthy Eating–Healthy Action (HEHA) social marketing campaign will be in place by 31 August 2007 to facilitate progress on promoting the key messages from the HEHA strategy.
• The HEHA strategy evaluation will be in place by 31 December 2007 to determine the effectiveness of HEHA implementation and the future direction for the HEHA Strategy.
• The first phase of the project to assess national capacity and capability required to meet future demand for cancer services, and address geographic and ethnic inequalities in access(including for Maori), will be completed by 30 September 2007 (Whakatataka Tuarua).
• Four regional cancer control networks will be established with reporting frameworks by 31 October 2007.
• Intensive tobacco control programmes will be implemented in four high-needs DHBs (Whanganui, Tairawhiti, Lakes and Northland) by 31 December 2007.
• DHB co-ordination pilots on suicide prevention that include contributing to the reduction of Maori suicidal behaviour, will be established by 31 March 2008 (Whakatataka Tuarua).
• Update of the framework for the provision of forensic mental health services will be completed by 30 November 2007.A breastfeeding social marketing campaign will be in place by 31 March 2008 to facilitate progress on the breastfeeding health target.
• All BreastScreen Aotearoa lead providers will migrate to one software system, namely the Orion Soprano BreastScreening system, by 30 June 2008 in order to address performance issues with other existing information systems, and to meet the accreditation requirements of the BSA Data Management Manual version 4.0.

The actions of the National Screening Unit Reducing Inequalities Action Plan completed by 30 June 2008:

• review the funding and contracting arrangements with independent service providers and other providers
• develop measurable and meaningful performance indicators to incentivise providers
• strengthen the focus of screening in DHB District Strategic Plans and District Annual Plans.

• The first year of the three-year joint work programme (with DHBs) for Te Ko¯kiri: The Mental Health and Addiction Plan will be implemented by 30 June 2008 including:
  • completion of phase 1 of the update of the Mental Health Service Coverage Schedule including clarifying the existing document and establishing minimum access levels
  • the development of a new framework for the Mental Health service specifications and the application to at least one service area
  • the development of a monitoring framework
  • review of Te Puawaitanga: Maori Mental Health National Strategic framework.
• The review and update of the Opioid Treatment Guidelines will be completed by 30 June 2008.
• The first phase of the project to assess national capacity and capability required to meet future demand for cancer services, and address geographic and ethnic inequalities in access(including for Maori), will be completed by 30 September 2007 (Whakatataka Tuarua).
• DHB co-ordination pilots on suicide prevention, that include contributing to the reduction of Maori suicidal behaviour, will be established by 31 March 2008 (Whakatataka Tuarua).

Child and youth services

• The ‘Ready for School’ pilot will be in place by 31 August 2007, with the ‘Ready for School’check national implementation phased in from 29 February 2008.
• The well child service review, which will promote whanau ora and improve the delivery of wellchild services to tamariki Maori, will be completed by 29 February 2008 (Whakatataka Tuarua).
• Guidelines for targeted chlamydia testing will be completed by 29 February 2008.
• Public health education and media campaign on safe sex will be under way by 31 May 2008 to follow up the ‘Hubba’ campaign of 2004–05.
• Implementation of a Family Violence death review process will be completed by 30 June 2008.
• The policy environment for maternity services in a devolved DHB context will be completed by 30 June 2008.
• The review and update of the child and youth mental health and addiction policy and service delivery framework will be completed by 30 June 2008.
• The National Immunisation Schedule, including the pneumococcal vaccine, will be implemented by 30 June 2008.

Elective services

• Formal Monitoring Intervention Framework response will occur within eight weeks of confirmed material deterioration in performance.
• Contracts for new initiative money will be monitored throughout the financial year.

Primary health care

• Stronger PHOs, as evidenced by:
  • production of a good governance guide by 30 September 2007
  • participation in governance workshops and training by PHO board members so that they better understand their roles and obligations. At least four courses/sessions during the 2007/08
  • description of the key capabilities required of PHOs to assist DHBs and PHOs with their planning and capability development by 30 June 2008.
• A chronic disease focus in primary health care, as evidenced by:
  • findings from the evaluation of the mental health initiatives completed by 30 June 2008
  • completion of review of best practice guidelines for the management of depression in primary health care settings by 30 December 2007
  • a reviewed scope for the Care Plus Programme by December 2007.
• Better alignment of accountabilities and funding as evidenced by next stage of funding formula review completed by 30 December 2007.

Health of older people

• A Cabinet paper updating progress and advising on next steps on community-based aged care and funding of aged-care services in support of the Minister’s priority for the health of older people will be completed by 10 December 2007.
• Report on gaps in services supporting continuum of care for older people will be completed by 30 May 2008.

Infrastructure – National Systems Development Programme

The National Systems Development Programme has been implemented as agreed between the Minister and Ministry. The programme consists of six workstreams, 28 portfolios and within these portfolios are 129 projects. By June 2008 this progressive programme will have completed some key stabilisation and standards projects that will provide foundation capability for enhancing sector-wide health information, connectivity and systems. The remainder of the deliverables will be achieved by June 2010.

The programme will monitor all programme costs on a weekly basis against forecast and report monthly as per its governance framework. Timeliness performance will be measured by measuring percentage of on-time deliverables against the plan.

Infrastructure – workforce

• New Zealand’s Health Career framework, in partnership with District Health Boards New Zealand, will be published and disseminated by 31 October 2007 to map health and disability careers to support staff retention and innovations in workforce planning and development.
• A Cabinet paper to implement the Workforce Taskforce (advisory to the Minister of Health)recommendations on streamlining medical education and training to produce medical practitioners who are fit for purpose and for practice in the minimum time period, will be completed by 29 February 2008.
• Under the Health Practitioners Competence Assurance Act 2003, the Ministry is required to commence a review of the operation of the Act. This review will be commenced by 30 November 2007 with a view to completion by December 2008.
• The development of a Mental Health and Addiction Core Competencies Framework will be completed by 30 June 2008.
• The development of a National Training Plan for Mental Health and Addiction workers will be completed by 30 June 2008.
• A Public Health Workforce Development Implementation Plan will be completed by 30 June 2008.
• A national body to co-ordinate public health workforce development established by 30 June 2008.

Value for money

• Dependent on the output of health sector survey about multiple audits in the health and disability sector (June 2007), a Cabinet paper on implementing specific feasible solutions to improve efficiency in health provider audits will be completed by 31 August 2007.
• National Service and Technology Review Advisory Committee (NSTR) analyses, reviews, ranks and makes recommendations on business cases submitted to the committee by 30 September 2007.
• The review of the mental health sector service standards will be completed by 30 November 2007.
• A health impact assessment unit will be established within the Ministry of Health by 31 May 2008.
• The development of DHB key mental health performance indicators will be developed by 30 June 2008
• Two DHB reviews relating will be undertaken by 30 June 2008.

Long-term sector plan development

• A long-term sector strategic plan will be completed by 4 December 2007.
• Implementation of government decisions on allocating funding responsibility for long-term support services for people with chronic health conditions will be completed by 30 June 2008.

System performance

• The Director-General’s annual report on the state of the public health will be completed by 30 September 2007.
• The Minister’s report on the implementation of the New Zealand Health Strategy will be completed by 14 December 2007.

Strategy, policy and system performance

Year	Revenue Crown $000	Revenue Department $000	Revenue Other $000	Total Expense $000
2007/08	70,560	365	-	70,925
2006/07	-	-	-	-