G.1. Report of the. Te Tari Mahi. for the year ended 30 June 2004

Transcription

1 Report of the Te Tari Mahi for the year ended 30 June 2004 Presented to the House of Representatives pursuant to Section 39 of the Public Finance Act

2 Department of Labour Wellington October 2004 The Hon Minister of Labour I have the honour to present the Annual Report of the Department of Labour Te Tari Mahi for the period 1 July 2003 to 30 June James Buwalda Secretary of Labour 2

3 DEPARTMENT OF LABOUR ANNUAL REPORT 2003/04 INTRODUCTORY INFORMATION CONTENTS Terms and Definitions Used 5 Chief Executive s Overview 7 Achieving Our Outcomes 13 - Our Contribution to Government Goals 13 - Managing for Outcomes 14 - Our Outcome Framework 15 Outcome 1 16 Outcome 2 24 Outcome 3 34 Outcome 4 39 Capability Needed to Achieve Our Outcomes 46 How We Manage Risk 54 Statement of Management Responsibility 56 Report of the Auditor General 57 STATEMENT OF OBJECTIVES AND SERVICE PERFORMANCE VOTE: LABOUR Output Class D1 - Policy Advice - Labour 64 Output Class D2 - International Services 72 Output Class D3 Services to Promote and Support Fair and Productive Employment Relationships 78 Output Class D4 Services to Promote and Support Safe and Healthy People and Workplaces 88 Output Class D5 - Services to Promote and Support Environmentally Sound Work Practices 95 VOTE: IMMIGRATION Output Class D1 Services to Increase the Capacity of New Zealand through Immigration 102 Output Class D2 Services to Position New Zealand as an International Citizen with Immigration- 123 Related Interests and Obligations VOTE: ACCIDENT INSURANCE Output Class D1 - Policy and Monitoring 132 Output Class D2 - Regulatory Services 136 VOTE: EMPLOYMENT Output Class D1 Policy, Purchase Advice and Monitoring 140 Output Class D2 Services to Generate Sustainable Community Wealth and Well-being 146 3

4 DEPARTMENT OF LABOUR ANNUAL REPORT 2003/04 FINANCIAL STATEMENTS Statement of Accounting Policies 154 Statement of Financial Performance 159 Statement of Movements in Taxpayers Funds 160 Statement of Financial Position 161 Statement of Cash Flows 162 Statement of Commitments 163 Statement of Contingent Liabilities 164 Statement of Unappropriated Expenditure 165 Statement of Departmental Expenditure and Appropriations 166 Statement of Trust Monies Memorandum Account Visa and Permits Notes to the Financial Statements 169 Schedules and Statements: Non-Departmental 181 Statement of Accounting Policies 182 Schedule of Non-Departmental Revenue 183 Schedule of Non-Departmental Expenses 184 Statement of Non-Departmental Expenditure and Appropriations 185 Schedule of Non-Departmental Assets 187 Schedule of Non-Departmental Liabilities 187 Statement of Non-Departmental Commitments 188 Statement of Non-Departmental Contingent Liabilities 188 Notes to the Schedules 189 ADDITIONAL INFORMATION Appendix 1: Policy Advice Performance Standards 190 Appendix 2: Legislative Framework 191 Appendix 3: Staffing as at 30 June Appendix 4: Fatal Accidents in 2003/ Appendix 5 : Migrant Levy Collection and Application 199 Appendix 6: Reducing Inequalities for Disadvantaged Groups - Annual Report 201 DIRECTORY 222 4

5 DEPARTMENT OF LABOUR ANNUAL REPORT 2003/04 TERMS AND DEFINITIONS USED TERMS AND DEFINITIONS USED ACC Accident Compensation Corporation AMS Application Management System APC Asia Pacific Consultations APEC Asian and Pacific Economic Cooperation APP Advance Passenger Processing ATV All Terrain Vehicle CAA Civil Aviation Authority CEDAR Community Economic Development Action Research CEG Community Employment Group CEO Community Employment Organisation DIA Department of Internal Affairs DoL Department of Labour ECP Electronic Channels Programme ERA Employment Relations Act 2000 ERE Employment Relations Education ERMA Environmental Risk Management Authority ERS Employment Relations Service FoW Future of Work FTE Full Time Equivalent GDP Gross Domestic Product GIF Growth and Innovation Framework HCF Human Capability Framework HLFS Household Labour Force Survey HR Human Resources HRMIS Human Resources Management Information System HSE Health and Safety in Employment HSNO Hazardous Substances and New Organisms ICT Information and Communications Technology ILO International Labour Organisation IT Information Technology LCI Labour Cost Index LiSNZ Longitudinal Survey of Migrants New Zealand LMPG Labour Market Policy Group 5

6 DEPARTMENT OF LABOUR ANNUAL REPORT 2003/04 TERMS AND DEFINITIONS USED MFAT MPIA MPU MSA MSD NACEW NECBOP NGO NZDMO NZIPS NZIS OECD OCE OSH PACRIM PIDC PNG RAA RRA RSAA SERA SOPEMI SSC TEC TFP TPK UNHCR VSR Ministry of Foreign Affairs and Trade Ministry of Pacific Island Affairs Mäori Perspective Unit Maritime Safety Authority Ministry of Social Development National Advisory Committee on the Employment of Women Northland, East Coast, and Eastern Bay of Plenty Non-Governmental Organisation New Zealand Debt Management Office New Zealand Injury Prevention Strategy New Zealand Immigration Service Organisation for Economic Development Office of the Chief Executive Occupational Safety and Health Service Pacific Rim Immigration Intelligence Conférence Pacific Immigration Director s Conference Papua New Guinea Residence Appeal Authority Removal Review Authority Refugee Status Appeal Authority Survey of Employers who have Recently Advertised (OECD) Sub Committee on Trends in Migration State Services Commission Tertiary Education Commission Total Factor Productivity Te Puni Kokiri United Nations High Commissioner for Refugees Vocational Services Review 6

7 DEPARTMENT OF LABOUR ANNUAL REPORT 2003/04 CHIEF EXECUTIVE S OVERVIEW Chief Executive s Overview James Buwalda Chief Executive Overview The continuing strong growth in the New Zealand economy means the environment in which the Department of Labour operates is changing fundamentally. Where once our challenge was to encourage economic and business growth to create more jobs, it has now shifted to meeting the skill needs of the labour market and increasing workplace productivity. This is a profound shift and it has happened quickly. Over the last four years unemployment has fallen from 6.1% to just 4% - a 17-year low. New Zealand now has more than two million people in the workforce, giving us a high labour market participation rate by the standards of most OECD countries. However, labour productivity, though growing at 1.7% a year, still lags behind that of most of the OECD. High levels of employment have also seen the emergence of skill and labour shortages - not just in specialist areas but also in traditional trades and unskilled or semi-skilled occupations. So there are constraints on the growth that can be achieved simply through increased labour force participation; and raising productivity becomes even more important in improving standards of living for New Zealanders. What all this means is that what happens in the labour market is of crucial importance to New Zealand and the work of the Department of Labour in thinking about and addressing these issues is equally important. That is why much of my focus through 2003 / 04 was on reorganising the Department to better align our policy and service delivery responsibilities with the strategy we re developing to respond to challenges and opportunities in today s labour market. Planning throughout the year led to the 1 July 2004 formation of three new servicedelivery groups Workplace, Workforce and Work Opportunities and centralised Strategy, Corporate, Legal and Maori Perspective groups supporting the whole. This will create a Department of Labour that s more agile, more responsive and delivers much better-connected services to our customers. This didn t slow our core business. We continued to increase our understanding of the labour market and future of work, and shared that knowledge widely. We supported employers and employees, helped build capability in communities, ensured employment and health and safety standards were met in workplaces, and supported skilled migration, refugee resettlement and the safety of New Zealand s borders. We worked with many organisations to overcome skill shortages through better aligning education, career planning and training; improving immigration systems to attract skilled overseas workers who meet New Zealand s needs; and encouraging 7

8 DEPARTMENT OF LABOUR ANNUAL REPORT 2003/04 CHIEF EXECUTIVE S OVERVIEW recruitment of workers not automatically considered for employment, such as older workers, people with disabilities and migrants. We partnered with businesses, employees, iwi, community groups and other government agencies to create conditions in workplaces and communities that help to increase productivity. Highlights of an extremely busy year signal how we ll continue to move the Department forward. Integrated activities such as small business support teams; the new skilled migrant programme; the online labour market portal, WorkSite PaeMahi; managing the labour component of trade negotiations and leading workplace research, enhance our ability to deliver connected service and information to customers everywhere. Post Balance Day Following key decisions by Government in late September in relation to community employment activities, the Department s role in community employment activities will change from a service delivery role to a knowledge role, thereby ceasing the activity of the Community Employment Group. Supporting Workplaces - Growing New Zealand The Department of Labour has a unique role in New Zealand workplaces. What we do makes a real and meaningful difference in people s working lives. We contribute right across the spectrum of work, from providing direct information and support to employers, employees and workplaces, including facilitating immigration, to planning, research and analysis that supports New Zealand s productivity and wellbeing. With New Zealand businesses competing with the rest of the world for skilled workers, and in producing goods for a sophisticated global market, increasing workplace productivity through innovation and superior skills is one way to get an edge. The new focus on workplace productivity has everything to do with working smarter and using best practice, rather than the old connotations of cost and job-cutting. The Department of Labour is involved in three main aspects - excellent workplace conditions; training, skills-development and recruitment; and immigration solutions. High-quality workplaces with active employment relationships, good health and safety systems and decent wages provide higher levels of job satisfaction and motivation which in turn lead to improved retention of valuable staff and the ability to attract more good staff. Thorough health and safety planning and decent employment relationships are an investment people who are off work or under-performing through illness, injury or grievance hold a business back from fulfilling its potential and increasing productivity. Skills development, from modern apprenticeships, industry-based training and foundation learning, to a strategic approach to tertiary education that encourages tertiary institutions to integrate courses with the needs and priorities of businesses and communities, is another key to improving productivity. The Department s current 8

9 DEPARTMENT OF LABOUR ANNUAL REPORT 2003/04 CHIEF EXECUTIVE S OVERVIEW co-ordinated research and analysis, and partnerships with other agencies and organisations, will enable us to take the lead on skills planning in future years. Immigration to meet New Zealand s skills needs, fill gaps, and increase our pool of talent is the third aspect of productivity. In December 2003, the government introduced a new skilled migrant category which shifted the focus from simple acceptance of applications to active recruitment of the skilled migrants New Zealand needs. We appointed relationship managers to work with economic development agencies, industry and employer groups, and other agencies to create a clear picture of skills needs, and reduce barriers to employment of migrants. And we set up closer co-ordination between policy development, skills action planning across the Department, and on-the-ground experiences of immigration, employment relations, health & safety and community employment staff. Connecting for outcomes It became even clearer to me as the year progressed that the devolved way the Department of Labour has worked since the late 80s no longer fits the new environment. Change was needed to create a connected DoL that will use closer links between strategic policy development and frontline experience to provide more useful, comprehensive service to customers and deliver on outcomes. As part of the Connecting for Outcomes changes we revised our second tier intermediate outcomes, which identify in more detail our contributions, reducing them from nine to four. In last year s Statement of Intent we discussed those nine outcomes: this Annual Report refers to the four revised intermediate outcomes. (Refer to page 14 for more detail) Planning during the year resulted in the appointment of seven new Deputy Secretaries and the creation of three new service-delivery groups plus centralised strategic and support functions on 1 July The new Workplace, Workforce and Work Opportunities groups encompass our current service delivery functions and integrate policy capacity with customer service. They have customers in common and will work closely together to provide integrated service. Workplace brings together all aspects of occupational safety & health, employment relations and ACC advice; Workforce combines Immigration and settlement support with employment and skills planning; and Work Opportunities broadens our community employment development and support for diverse communities. The Deputy Secretaries for the Strategic, Corporate, Legal and Maori Perspectives groups join the Deputy Secretaries Workforce, Workplace and Work Opportunities to form the Department s new Strategic Leadership team. While frontline customers will see little change initially, in the longer term service to the government, customers and stakeholders will improve as the Department provides better connections between strategic policy and service delivery, and much better links between arms of the Department. Fixing the failures in systems and processes The Department also faced a number of very public problems during the year, and took steps to ensure our systems, processes and behaviours will meet the highest standards of the public service. 9

10 DEPARTMENT OF LABOUR ANNUAL REPORT 2003/04 CHIEF EXECUTIVE S OVERVIEW An investigation into the Department s handling of information uncovered problems with official information obligations, and related policies, systems and practices. Immediate steps to address these issues included revision of relevant systems and processes; a new Official Information policy and robust management practices for handling official information; and further training for staff in official information and code of conduct matters. Immigration is always in the public eye, and the past year saw several major issues making headlines. Later in the year, systems and process problems in the community employment area were uncovered in investigations into several community grants. Since then we have strengthened our grant systems considerably. New compliance standards, which include new processes for making funding decisions and improved monitoring and reporting, were implemented in April Public servants work hard to deserve and hold the trust and respect of citizens. I am determined that we pay particular attention to this at the Department of Labour. Our services can significantly affect peoples lives: we must respect the authority we hold, be accountable, and work with people fairly and honestly so the public can have ongoing confidence in the Department. Highlights of the year Achievements related to our intermediate outcomes are covered fully in Part A of this publication. Below are the major highlights that contributed to moving New Zealand towards a society where people have high-quality working lives and live in thriving, inclusive communities. People with high-quality work in productive workplaces S To avert later, intensive interventions we provided early, targeted information on employment relationships, problem-resolution services and workplace health and safety to groups, industries, workplaces and individuals through thousands of pro-active visits, seminars and presentations; via websites and our freephone call centre, and through attending popular national events such as Pasifika and Fieldays. S To help employers and employees develop personalised employment agreements we produced the online Employment Agreement Builder tool, which was used for 17,860 agreements from February 2004 to June S We released a draft Workplace Health and Safety Strategy for public consultation, and the construction industry is already amending elements of its strategy so that it aligns with the draft strategy. S With ACC, we led a major review of the medical misadventure provisions in the ACC scheme. S To inform wider New Zealand about the importance of health and safety issues we are working with a television company to create a 10-episode series on the work of OSH staff. 10

11 DEPARTMENT OF LABOUR ANNUAL REPORT 2003/04 CHIEF EXECUTIVE S OVERVIEW S We set up the Decent Work Taskforce in Auckland to investigate and remedy illegal employment and sweatshop activities; and piloted a new system of supporting small and medium enterprises through small business support teams. S We provided policy advice and legislative support for the Holidays Act 2003; Employment Relations Law Reform Bill; the repeal of the Disabled Persons Employment Protection Act (to give people in sheltered workshops the same employment rights as others); the taskforce on pay and employment equity, and changes to the adult and youth minimum wage. More people participating in the skilled workforce and their communities S We completed phase two of WorkSite PaeMahi, the multi-agency labour market portal which now provides jobs, skills, careers, training and other work-related information from regional, private, NGO and community groups, as well as from 10 government agencies S We introduced the new Skilled Migrant Category to better meet New Zealand s skills needs, and marketed New Zealand as a destination to potential skilled migrants in Britain and USA through a number of events and activities. We also revamped the Immigration website to make it easier for potential skilled migrants to access information. S We funded and monitored a range of settlement services to help migrants and refugees settle well, fit into communities and find suitable employment. S We made good progress on the Future of Work programme and research which looks at long-term implications for work and employment in New Zealand; and co-ordinated the skills action plan and job vacancy monitoring programme to inform current planning. More high-quality work opportunities S To identify community ICT priorities for the next five years we hosted a Connected Communities conference, attended by 450 community and government representatives, as part of our leadership of the Connecting Communities Strategy. S To help foster Maori tourism SMEs we developed an online Maori tourism incubator park as part of the Maori Tourism Strategy. S We continued the Community Economic Development Action Research project working with communities in Twizel, Napier and Christchurch to examine the links between assistance and community outcomes. S To make it easier for overseas students to visit and study in New Zealand we held student seminars overseas, and provided improved systems including online applications for students to receive and renew permits. 11

12 DEPARTMENT OF LABOUR ANNUAL REPORT 2003/04 CHIEF EXECUTIVE S OVERVIEW More international influence on global labour and security issues and institutions S We brought to New Zealand and helped settle 812 refugees from trouble spots around the world, including family members of the Tampa boys. S Our Mangere Refugee Resettlement Centre provided a wide range of health and education services for new arrivals, and we worked closely with other agencies to help resettle refugees. To better understand the needs of refugees we completed a three-year study, Refugee Voices, exploring the varied experiences of 398 refugees. S To enhance the security of New Zealand s borders we increased our border and investigation activities. This included forming new intelligence and fraud units which resulted in a significant increase in prosecutions for fraud; 52% more people being refused entry at the border and the number of undocumented passengers arriving in New Zealand dropping by 45%. S By June the Advance Passenger Processing system was available to most airlines flying into New Zealand, and 70% of passengers were able to be screened prior to boarding. S We co-ordinated New Zealand s participation in ILO international events and conferences, including the sub-regional forum on Decent Work in Auckland in October. We provided reports to the ILO on New Zealand s compliance with ILO Conventions, input into the labour aspects of international trade negotiations, and advice to Ministers on the implications of ratifying ILO Conventions. S The United Nations HCR continued to express appreciation for New Zealand s international refugee protection role, and commended our refugee status determination process and the services of the Mangare Refugee centre. Conclusion The Department of Labour has had another extremely busy year delivering a wide range of services and meeting increased expectations, while starting an extensive change process that will maximise our effectiveness. I want to thank staff of the Department for their commitment, energy and dedication to improving the working lives of New Zealanders and the life of communities. I am confident that improvements in our processes and systems, the skills of DoL people and the wider connections we draw on will enable us to work to our potential and deliver on outcomes in the coming years. James Buwalda 12

13 DEPARTMENT OF LABOUR ANNUAL REPORT 2003/04 ACHIEVING OUR OUTCOMES Achieving Our Outcomes Departments are expected to manage for outcomes. This involves defining the impacts the Department wants to have on outcomes for the community; the contribution of these outcomes to the Government s goals; understanding the impact of the Department s services and activities on these outcomes; and ensuring activities are directed towards achieving the outcomes the Government is seeking for all New Zealanders. CONTRIBUTION TO GOVERNMENT GOALS The Department contributes to the following key Government Goals that guide the public sector: Grow an inclusive, innovative economy for the benefit of all through all activities across the Department Maintain trust in Government and provide strong social services through all activities across the Department Improve New Zealanders skills through the Department s activities that contribute to our workforce outcome Reduce inequalities in Health, Education, Employment and Housing through the Department s activities that contribute to our workplace, workforce and work opportunities outcomes Protect and enhance the environment through the Department s activities that contribute to our workplace outcome Strengthen national identity and uphold the principles of the Treaty of Waitangi by incorporating Treaty principles into the Department s activities. 13

14 DEPARTMENT OF LABOUR ANNUAL REPORT 2003/04 ACHIEVING OUR OUTCOMES MANAGING FOR OUTCOMES Over the past year, we refined the Department s strategic direction to sharpen our focus on our unique role in the workplace and the labour market. Purpose We help people achieve high-quality working lives in thriving and inclusive communities, through linking their economic and social interests. We reviewed and reconfirmed our overarching outcome. Overarching Outcome People with high-quality working lives in thriving and inclusive communities. We revised our second-tier intermediate outcomes which identify in more detail our contributions, reducing them from nine to four. Intermediate Outcomes Workplace Employees and employers achieve sustainable productivity gains through highquality workplace environments. Workforce Overall contribution to society will increase as the skills of the workforce increase and the number of people participating in the skilled workforce and their communities increases. Work opportunities Increased high-quality work opportunities generated through more productive enterprises and enterprising communities. International influence Increased international influence on global labour and security issues and institutions, through participation in international forums and fulfilling obligations. We also developed indicators to assess progress towards these intermediate outcomes and therefore the overall outcome. We continued to develop performance measures for activities that are outcome-focused and support the intermediate outcome indicators; and systems to capture data and report on these measures. In the next section we summarise our work programme as a series of key actions in 2003/04 that will help, over time, to achieve our outcomes. We also identify the agencies we worked with to help achieve these outcomes, and the measures to monitor progress towards those outcomes. 14

15 DEPARTMENT OF LABOUR ANNUAL REPORT 2003/04 ACHIEVING OUR OUTCOMES OUR OUTCOME FRAMEWORK 15

16 DEPARTMENT OF LABOUR ANNUAL REPORT 2003/04 ACHIEVING OUR OUTCOMES OUTCOME 1: PEOPLE WITH HIGH-QUALITY WORK IN PRODUCTIVE WORKPLACES The intermediate outcome we are seeking is: Employees and employers achieve sustainable productivity gains through high-quality workplace environments. THE HIGH-QUALITY WORKING ENVIRONMENT Workplaces with excellent work practices and conditions will be more productive over time because employees in high-quality environments are better able to contribute to the productivity of the workplace. High-quality workplaces have higher levels of job satisfaction and motivation, improved retention rates and the ability to attract good staff. They balance the needs of employers and employees. Employers have sufficient flexibility to operate their business and contain costs so that job opportunities can be created and sustained. Employees are able to successfully balance work with other parts of their lives. A high-quality workplace is one that drives out: - poor health and safety practices - workplace illness and disease - time lost through injury - absenteeism - loss of skills and knowledge - costs of disputes - difficulties in recruitment and retention. What we did in 2003/04 towards achieving this outcome IDENTIFY AND SHARE BEST PRACTICE We sought to better understand our customers needs, to provide targeted, practical and timely information and assistance. Key Achievements in 2003/04 Workplace Productivity Project At the request of Cabinet, we are leading a Workplace Productivity Working Group to review understanding, policy settings and practices on workplace productivity 1, develop ideas, and build awareness about lifting productivity. A Workplace Productivity Workshop in May 2004 provided valuable input into the consideration of productivity issues and leads for future work in promoting best practice. The Working Group also discussed engaging with small businesses on workplace productivity with the Small Business Advisory Group, and the particular challenge for small business owners of generating sufficient time to focus on productivity issues. 1 Workplace productivity refers to what occurs inside the firm, in particular workplace relations, managerial capability, the ways that ideas and technology are adapted and adopted by firms. 16

17 DEPARTMENT OF LABOUR ANNUAL REPORT 2003/04 ACHIEVING OUR OUTCOMES The Working Group is preparing four broad sets of recommendations relating to raising awareness; diagnostic support and tools; implementation assistance; and research and evaluation. A website is under development and focus groups are planned for 2004/05 to gain further views on workplace productivity. Small and Medium Businesses The Small Business Active Pilot helped to explore new ways of delivering services to small and medium sized enterprises (SMEs) to meet their employment relations, health and safety and immigration needs, and to promote best practice. Project teams from across the Department worked with migrant businesses in Auckland, umbrella industry and community organisations in Hawkes Bay, and dairy farmers in Invercargill to generate ideas for more effective service. We are building on learning from the Pilot in establishing Small Business Support teams in four regional locations during 2004/05. We participated in the Small and Medium Enterprises Senior Officials Group which was convened to help co-ordinate and align government policies for SMEs. Discussions generally focused on how government agencies can support and strengthen small and medium size enterprises. High-Quality Workplaces We are co-ordinating the development and implementation of a national Decent Work Action Plan aligned with the ILO s concept of decent work that promotes core rights at work, employment opportunities, social protection and social dialogue. We undertook an initial stocktake of our activities, and those of Business NZ and the CTU, which are linked to these four key areas of Decent Work as defined by the ILO. We started a Work-life Balance projec to encourage people to think about work-life balance issues and help more people enjoy the benefits. We consulted with a wide range of people, and a dedicated website encouraged participation in the project. The information collected was analysed, and a summary of what people told us - Achieving Balanced Lives and Employment was published. A framework for considering policy options is being drafted as a basis for a Government response to the issues raised. We reviewed the Paid Parental Leave scheme after one year of operation to assess its effectiveness and where further developments might enhance intended outcomes. This review, which included consultation with key stakeholder groups, demonstrated strong support for the scheme itself and the ease with which employers and employees could access its provisions. Fewer than 10% of employers considered paid parental leave to have had a negative impact. In March 2004 the Government announced its intention to introduce legislative amendments to extend both the period of paid leave and the range of employees who will have access to paid leave. We ran six focus group sessions with SME employers and employees to get their views on the quality of our employment relations problem-resolution services; and their impact on employment relationships. Overall feedback was very positive, with participants commenting specifically about the proficiency and fair-mindedness of mediators and the processes used. After mediation many employers believed they were more diligent about how they worked with staff. There was also a general willingness to resolve future workplace issues through mediation in the first instance rather than through the more formal resolution processes of the Employment Relations Authority and Employment Court. 17

18 DEPARTMENT OF LABOUR ANNUAL REPORT 2003/04 ACHIEVING OUR OUTCOMES Within the context of the New Zealand Injury Prevention Strategy launched in June 2003 we led the development of a New Zealand Workplace Health and Safety Strategy. A draft Workplace Health and Safety Strategy was developed for public consultation. It includes as one of its eight principles the protection of vulnerable workers who have higher workplace injury and illness rates. Public consultation started in August The draft Strategy has already had an impact on the development of the construction sector s health and safety strategy, with amendments made to some elements to bring it more into line with the draft Workplace Health and Safety Strategy. We supported the National Advisory Committee on Occupational Safety and Health, which provides independent advice to the Minister of Labour on major occupational health issues in New Zealand. The Committee s report (due for release in October 2004) provides an overview of the burden of occupational injury and illness in New Zealand. The Committee also considered proposals for projects to start in 2004/05. The first of these is a review of the methods and systems used to measure occupational injury and illness in New Zealand. We continued the cross-agency project to improve understanding of the cost of injury, and in June 2004 published a report, Measuring the Costs of Injury in New Zealand. The report sets out a framework that identifies ways of measuring different types of costs from the perspectives of individuals, employers, government and wider society. It identifies the current state of data in each of these categories and proposes a research agenda for filling in gaps. We led the Pure Business Project, which brought together government agencies and small to medium-sized businesses to explore issues relating to regulation, including how to change what isn t working and expand what is. The project held a forum in June 2003 that shared findings to date, and established the direction for Phase 2, including setting up a number of practice fields to develop and pilot possible solutions. We undertook research into employee and employer perceptions of our occupational safety and health investigation processes. The results demonstrated a high level of general satisfaction, and identified specific aspects for further improvement. We built community and industry networks by being accessible, sharing knowledge and best practice with customers and stakeholders, and raising awareness about the benefits of excellent workplace practices. Key Achievements in 2003/04 We established a Decent Work Taskforce based in Auckland to co-ordinate and focus on ensuring that workers receive their legal entitlements from employers, have adequate health and safety standards and legal immigration status. Since its inception in 2003 the Taskforce has investigated three possible sweatshops, and further investigations are underway. It also identified a clear need among specific groups for more education about minimum rights and obligations. We increased the capacity of the secretariat for the National Advisory Council on the Employment of Women (NACEW) to support the Council's expanded work programme. Highlights of the year for NACEW were an international conference on pay and employment equity in June, the publication of research on women in self-employment, and raising awareness of work-life balance. 18

19 DEPARTMENT OF LABOUR ANNUAL REPORT 2003/04 ACHIEVING OUR OUTCOMES We piloted (in Whangarei and Hamilton) a diagnostic tool to help employers identify potential employment issues, and provided tools and information to mitigate these. This tool will be rolled out to other regions in 2004/05. Our occupational safety and health work programme focused on a range of industries, occupational processes, and workplace hazards and issues which were selected according to rates of illness and injury, potential for catastrophic failure, and topicality. This programme included: providing advice to a range of organisations on processes for gaining agreement to employee participation systems under the HSE Amendment Act. Research into the level of employee participation in health and safety has identified opportunities for further information and assistance introducing or updating 15 best practice documents, often working collaboratively with other agencies such as ACC and industry groups, with a further 37 documents at various stages of production working with MSA and CAA to assist them in their roles as designated agencies charged with the administration of the HSE Act in the maritime and aviation sectors providing information on actions to ensure better management of hazardous substances, as part of the implementation of the recommendations of the Ministerial Inquiry into the Management of Certain Hazardous Substances in the Workplace. We commenced a significant project for social marketing of health and safety issues with Greenstone Pictures. A 10-episode reality television series Special Investigators, focusing on the work of OSH inspectors, started production in During the series, expected to show in 2005, field staff deliver key messages promoting health and safety in workplaces. We worked with ACC to support the establishment of industry health and safety groups, particularly in the 14 industries that the ACC have identified as priorities. There are currently 10 health and safety representative groups known to be operating within these priority industries. We combined with ACC and farming organisations to address the problem of tractor and all-terrain vehicle (ATV) accidents, the leading cause of workplace fatalities in the agricultural sector. There were seven ATV fatalities on farms in 2001/02; this year there were just two. INFORM, EDUCATE AND ASSIST When more people draw on our education and information services, they are able to adopt excellent workplace practices which exceed legal obligations. This helps build the capability of employers and employees to manage their own workplace conditions, thereby preventing problems and reducing the need for enforcement. Key Achievements in 2003/04 A key focus during 2003/04 was investing in educating and enabling employers and employees to build their knowledge and capability. This contributed to building best practice, and averting or minimising employment relations and occupational safety and health problems. We made improvements to our provision of integrated 19

20 DEPARTMENT OF LABOUR ANNUAL REPORT 2003/04 ACHIEVING OUR OUTCOMES information on workplace issues to the public generally, and to target groups in particular. The new WorkInfo programme provided appropriate tools, practices and information systems to support our work with employers and employees. The purpose of Workinfo is to effectively capture and share knowledge across a whole-of Department customer base to provide targeted and integrated information on employment relations and health and safety best practice. Ultimately staff, stakeholders and partners will have information to make better choices about who to target and what tools to apply. In 2003/04 we: developed a shared database to provide better access to and analysis of customer information developed a clearing house for best practice, standards and guidelines on employment relations and occupational safety and health promoted a cultural change within the Department to increase our focus on customers, and encourage a stronger data-gathering and reporting culture diversified communication channels for disseminating knowledge to our staff and customers. These channels include the 0800 WorkInfo call centre and dedicated website which dealt successfully with requests for information and dispatch of a range of publications. We upgraded existing Service communication channels and websites to improve their navigability and increase ease of access to publications; fact sheets; and other sources of assistance, information and tools such as the Employment Agreement Builder on the ERS website. The ERS 0800 Infoline and Website received record numbers of calls, enquiries and visits, particularly following the passing of the new Holidays Act. Since its inception, the Employment Agreement Builder has become the most popular page on the website with 17,860 agreements completed from February to June We continued to build employer and employee capability in best practice employment relations, with the aim of reducing the number and severity of problems. This included thousands of seminars, talks and visits to targeted sectors, to improve their understanding of employment rights and obligations and occupational safety and health issues. Channels included Heartland clinics, community groups, women s organisations, business networks, training organisations, hui and poukai, and meetings with Pacific communities. We participated in a number of national events such as Pasifika and Fieldays to promote our range of services and workplace best practice. Some events included joint participation with other agencies and groups. We established websites dedicated to projects and programmes including Work-Life Balance, the Workplace Health and Safety Strategy and the Future of Work (See Outcome Two), to provide specific information and increased access for input into these projects and programmes. 20

21 DEPARTMENT OF LABOUR ANNUAL REPORT 2003/04 ACHIEVING OUR OUTCOMES SET AND ENFORCE STANDARDS While we placed greater emphasis on enabling and educating, defining and enforcing minimum standards continued to be fundamental to our work. Key Achievements in 2003/04 Employment Relations We provided policy advice on and legislative support to the Holidays Act 2003, which was passed in December 2003 and came into force on 1 April The Act impacts on all employees in every workplace (except the Defence Force) and promotes work practices that are family-friendly and provide work/life balance. A comprehensive information strategy accompanied the new Act. We continued to provide advice and assistance to employers and employees, and to monitor implementation and interpretation of the changes. We provided policy advice on the Employment Relations Law Reform Bill, and continuing support to the Transport and Industrial Relations Committee examining submissions on the Bill, which was reported back in September 04. The Bill confirms and enhances the Employment Relations Act s key policy objective of productive employment relationships. We participated in, and provided policy advice and secretariat support to, the Government Taskforce on Pay and Employment Equity in the Public Service, Public Health Sector and the Public Education Sector. As a result of the Taskforce s recommendations, the Government agreed to a five year action plan to progress pay and employment equity in these three sectors. This work will be led by a dedicated pay and employment equity unit to be established in the Department in 2004/05 to guide and assist agencies in these sectors to implement the plan using a partnership approach. We provided policy advice on the increases in adult and youth Minimum Wages, which provide wage protection to vulnerable workers by ensuring wages paid are no lower than a socially-acceptable minimum, and incomes of people on low incomes do not deteriorate relative to those of other workers. These changes took effect from 1 April 2004 and were supported by targetted information material. We continued to enforce minimum employment rights through our Labour Inspectors and provision of mediation services; and by providing support services to the Employment Relations Authority, Employment Court and Remuneration Authority. Health and Safety in the Workplace We continued to implement and enforce provisions of the Health and Safety in Employment Act, including the changes that came into force in May This included workplace visits to provide information, and assess and assist with the practical application of good health and safety practice, workplace compliance assessments, formal investigations (including workplace fatalities) and prosecutions. As an addition to the existing prohibition and improvement notices, infringement notices were introduced for breaches of HSE legislation, and these were an effective compliance tool available to Inspectors. 21

22 DEPARTMENT OF LABOUR ANNUAL REPORT 2003/04 ACHIEVING OUR OUTCOMES We continued to enforce the Hazardous Substances and New Organisms legislation under transitional arrangements with ERMA, and to enforce HSNO controls with the transfers of explosives on 28 August 2003, flammable and toxic hazardous substances on 1 April 2004, and pesticides on 1 June We continued to work with ERMA and the Ministry for the Environment on an extensive work programme to implement and support the transfers and to improve the workability of the Hazardous Substance provisions of the HSNO Act. We participated in the determination of the controls required for the substances to be transferred and worked on a combined project to identify highrisk workplaces and the substances involved. We also worked with Territorial Authorities (TAs), Regional Councils and associated contractors on the retention of HSNO services, including emergency services, at a local government level to gain the maximum possible participation and coverage by region and risk priority. We provided advice on the repeal of a number of HSE regulations (certificates of competence) made redundant by the transfer of explosives to HSNO controls. We are leading the development of regulations under the HSNO Act to enable infringement notices to be issued as a less harsh option to prosecution, and to clarify matters relating to inspectors rights of entry under the HSNO Act. Accident Compensation We continued to co-lead with ACC a major review of the medical misadventure provisions in the ACC scheme, and made recommendations to government to replace the current provisions with a new concept of 'treatment injury'. These proposals will be reflected in legislation which will be introduced in 2004/05. Who we worked with to achieve this outcome We continued to build strong relationships with employers, employees, business and union partners, industry bodies and sector groups, ERMA, territorial authorities and industries, transport safety agencies (in particular the Civil Aviation Authority, Maritime Safety Authority and Land Transport Safety Authority), employment relations institutions, international institutions with a focus on labour-related issues, and ACC. We provided secretariat services to the National Advisory Council on the Employment of Women (NACEW), the Injury Surveillance Ministerial Advisory Panel and the ACC Ministerial Advisory Group. ACCIDENT COMPENSATION CORPORATION (ACC) The Department of Labour and ACC share the specific objective of preventing injuries in New Zealand and, where injuries occur, assisting people to return to work and regain their independence. ACC addresses all aspects of injury prevention in New Zealand. The Department focuses on preventing injuries in the workplace by improving health and safety practices. In 2003/04 we worked closely with ACC on a number of complementary activities (at national and regional levels) to support injury-prevention initiatives, including developing best practice documents, supporting the establishment of industry health and safety groups, and addressing tractor and ATV accidents. The Department also provided policy, purchase and monitoring advice to Ministers about the ACC scheme, the rehabilitation assistance and compensation available for people who have an accident in New Zealand, and the performance of ACC in 22

23 DEPARTMENT OF LABOUR ANNUAL REPORT 2003/04 ACHIEVING OUR OUTCOMES delivering this assistance. Some of this work, particularly in relation to assisting people who are unable to return to their previous job following an injury, also contributes to the outcome of more people participating in the skilled workforce and their communities. We continued to co-lead with ACC a major review of the medical misadventure provisions in the ACC scheme, and made recommendations to Government to replace the current provisions with a new concept of 'treatment injury'. We worked with ACC to develop a number of other policy proposals that were reflected in legislation which will be introduced in 2004/05, such as changes to calculation of compensation for self-employed claimants, and extension of discretion in provision of certain rehabilitation entitlements. We continued to co-lead the ACC/DoL evaluation strategy, including scoping an impact evaluation for the workplace safety management practices programme, and contributing to a review of the Partnership programme and to scoping an evaluation of rehabilitation entitlements. We also managed the 2004 budget round for Vote ACC, and advised on the required changes to treatment cost regulations to implement the decisions of the 2003 budget. Monitoring progress towards outcomes We expect that over time the Department s activities under this outcome will contribute to: more workplaces demonstrating excellent workplace practices that exceed their legal obligations an increase in the quality of work fewer occupational injuries and less occupational disease an increase in productivity. To assess progress towards this outcome, during 2003/04 we monitored changes in: growth in productivity, employment and wages labour force participation rates and reductions in unemployment knowledge and implementation of best practice in the conduct of employment relationships occupational injury and disease statistics. The results of this monitoring are reported in the Statement of Objectives and Service Performance section of the report under Vote Labour Environmental Information. 23

24 DEPARTMENT OF LABOUR ANNUAL REPORT 2003/04 ACHIEVING OUR OUTCOMES OUTCOME 2: MORE PEOPLE PARTICIPATING IN THE SKILLED WORKFORCE AND THEIR COMMUNITIES The intermediate outcome is: Overall contribution to society will increase as the skills of the workforce increase and the number of people participating in the skilled workforce and their communities increases. INCREASING PARTICIPATION AND SKILLS A highly skilled workforce will help New Zealand be more productive and competitive in the global market and will contribute to higher economic growth. People with skills and qualifications are more likely to get a job and earn more. They are also more likely to stay in employment because their jobs are less vulnerable to fluctuations in the economy, and they are able to move between industries and adapt to changes in the nature of the work they do. To meet the skill needs of New Zealand s changing business environment we need more skilled people participating in the labour market. Within New Zealand there are communities with entrenched barriers to participating in the labour market barriers like poor work conditions, skill shortages, remoteness and lack of local employment opportunities. Building community wellbeing, fostering community leadership and improving local co-ordination of agencies, services and resources helps reduce these barriers over time. Even with increased participation, not all skill needs can be met from within New Zealand. Although we can improve the skills of New Zealanders through education and training, this is not a short-term solution to the need for skilled people. Immigration brings migrants with the skills we need to New Zealand, to participate in our most productive sectors, passing on their skills and knowledge to other people in the New Zealand workforce, and adding value to enterprises. Migrants and their families need to settle successfully into New Zealand life so they can participate in their communities, actively contribute to their workplaces and play their part in growing the New Zealand economy. IDENTIFY AND SHARE BEST PRACTICE We used our knowledge of the labour market to understand labour and skill shortages, and predict short, medium and long-term trends. We made this information available to all New Zealanders, for use in decisions about careers, training, employment programmes and employment strategies. Key Achievements in 2003/04 Employment Policy We continued to lead advice to Government on employment policy. In particular we oversaw and monitored the implementation of the Employment Strategy. This is the integrated framework for implementing the Government s employment priorities, which aims at maximising job opportunities to increase 24

25 DEPARTMENT OF LABOUR ANNUAL REPORT 2003/04 ACHIEVING OUR OUTCOMES potential and enhance productivity; minimising disadvantage and improving sustainability of employment; and improving the quality of people s working lives. The Employment Strategy provides the framework for many of the initiatives below. With the Ministry of Social Development, we continued to support the Employment Evaluation Strategy - an interagency project to improve the ability of evaluators to provide robust and useful information to those responsible for the policy and delivery of employment assistance in New Zealand. Significant progress was made in developing common measures and methods for estimating the net number of people who will move into employment, and assessing the cost-effectiveness of active labour market policies. Identifying and Addressing skill shortages We continued to co-ordinate the Skills Action Plan the whole-of-government strategy that aims to speed up matching people's skills to job opportunities that are currently available, and reduce skill shortages in the future by helping people to make informed decisions about education and training. Working with a wide range of government agencies, we completed a skills development framework and an evaluation and monitoring plan; briefed Ministers on progress in meeting skills needs; and published quarterly reports on skill shortages. These included focus reports highlighting the approaches to co-ordinating interagency work in Canterbury, Taranaki, Bay of Plenty and Northland; and within the wood processing, agriculture, horticulture, and tourism industries. A Meeting Skills Needs: Government Policy Response was completed and released on our DOL website. As part of communicating the Skills Action Plan: We completed phase two of WorkSite PaeMahi ( - the web-based, multi-agency labour market portal launched in 2002 which provides a wide range of labour market-related information from ten government agencies. Phase Two now provides easy access to regional, private, NGO and community information, and more information for specific groups. Pathways have been developed to help users of the site make better choices about their working life. We published further issues of WorkINSIGHT, a six-monthly newsletter for people who advise students, workers and jobseekers about their study and career options, and anyone wanting to keep up-to-date with the latest job market news, research and trends. We made good progress on the Future of Work programme, which aims to increase understanding of future work trends and their implications for the workplace, workforce, employment opportunities and labour market regulation. Future of Work brings together existing information, generates new research and presents findings in an informative and widely accessible manner. The 2003/04 research programme was completed, a workshop held (co-hosted by Healthy Christchurch) and proposals for the 2004/05 research programme sought. We also developed a strategic level workplan which is now being implemented. The findings to date have been made available publicly through a dedicated website and through Work Trends, a new publication designed to help people make more informed decisions about their working lives. About 14,000 copies of Work Trends were distributed and continuing requests have resulted in a 25

26 DEPARTMENT OF LABOUR ANNUAL REPORT 2003/04 ACHIEVING OUR OUTCOMES further reprint. We are working with Careers Services to establish websites to enable their clients to access future-oriented labour market information. In partnership with the EEO Trust we undertook a project - PeoplePower - Successful Diversity at Work - aimed at informing employers about the business benefits of workforce diversity and encouraging them to increase diversity in their own firms. Case study research was completed, and nearly 60 stories of successful workforce diversity were made available through the EEO Trust website ( A free publication featuring twelve case studies, along with facts and figures on the changing face of the New Zealand workforce, and information on assistance available to employers, was prepared. The publication and web resource were launched in August We completed the pilot stage of the Job Vacancy Monitoring Programme. The programme is aimed at gaining new insights into skill shortages in New Zealand and includes surveys of employers who have recently advertised job vacancies, and a monthly analysis of advertised vacancies. Quantitative research was undertaken into factors affecting supply and demand for selected occupations. This information will allow development of policies to improve matching in the labour market and reduce shortages. In 2003/04, pilot reports on 14 skilled occupations deemed to be in shortage were produced. Twenty five occupations in shortage will be analysed in 2004/05 when the programme is fullyimplemented. A Job Market Monitor report is published monthly. We began stage 2 of the integrated Linked Employer/Employee data project (LEED),in conjunction with Statistics NZ and other relevant agencies. LEED will enable improved analysis of the process of job creation, destruction and labour market performance. The project examines questions about workers and their jobs that cannot be answered from employee or employer surveys alone. In time integrated data will offer insights into the way the economy functions, aiding design of policies to support growth, innovation, skill development and employment. We completed a survey on the information needs of labour market consumers and how we can best meet those needs; and undertook consultation on a draft Labour Market Information Strategy. We continued to provide information on trends in the labour market through quarterly monitoring reports such as the Household Labour Force Survey, Quarterly Survey of Business Opinion, Quarterly Employment Survey and Labour Cost Index. We completed the two Regional Immigration Pilots in Wellington and Southland/Clutha, to support regional economic development and enhance regions ability to use immigration to meet skill needs where positions cannot be filled from within New Zealand. We worked with regional councils, economic development agencies and New Zealand employers to better match skills with regional work opportunities and enhance settlement outcomes for migrants. The pilots met the overall objectives with significant improvements in: regional understanding of immigration policies and processes, and issues relating to the employment of migrants the availability of information to both permanent and temporary migrants about employment, investment and lifestyle opportunities in regions the level of our services to regions to assist skilled and business migration ensuring that effective settlement services are available to migrants in regions. 26

27 DEPARTMENT OF LABOUR ANNUAL REPORT 2003/04 ACHIEVING OUR OUTCOMES As part of the Immigration Customised Service:Skilled Migrant (CS:SM) programme we appointed Relationship Managers to actively establish and sustain partnerships with a wide range of stakeholder groups such as central and local government bodies, economic development agencies, industry groups and employer groups, to improve understanding of New Zealand s skill needs and the appropriateness of immigration in meeting specific skill requirements. High-level overviews were completed for the Bay of Plenty, Gisborne, Hawkes Bay, Manuwatu-Wanganui, Taranaki and Wellington regions, plus industry overviews covering energy, recruitment agents, education and health. These identified the most appropriate ways for relationship managers to work proactively with that region or industry. This approach helped identify industry issues including skill shortages, labour market checks, and difficulties with the Occupational Shortages List (OSL) and Priority Occupations List (POL). We undertook education and awareness programmes on work permit and Immigration policy with a wide range of strategic partners including education providers, immigration and travel agents, employer, regional and industry groups and community and ethnic/cultural groups. INFORM, EDUCATE AND ASSIST We developed policy and programmes to assist New Zealanders to become part of the workforce or increase their skills. Key Achievements in 2003/04 With Treasury and MSD, we led the development of policy for the cross-agency Jobs Jolt programme of ten initiatives aimed at tackling skill shortages and getting more New Zealanders into work. (Also see Cyber Communities project) We contributed to the Growth and Innovation Framework through analysis and advice on skill development priorities and input into the Senior Officials Group. We are leading the GIF Skills and Talent multi-agency stream of work designed to achieve "World-class human capability which enhances the competitiveness of the New Zealand economy and supports productive growth" by developing initiatives that progress the skills and talents of New Zealanders. We continued to build and strengthen relationships and initiatives with industry and regional groups, including the Nelson seafood cluster; horticulture; and the textile, clothing and footwear, and forestry industries. As part of the Wood Processing Strategy we assisted with the drafting of the Forestry Contractors Employment Guide and finalising the labour and skills component of the Forestry Industry Framework Agreement. Through the Industry and Regional Co-ordination and Facilitation programme we provided advice, analysis, co ordination and support to industry and regional labour market projects in response to GIF taskforces, particularly to industry and regional clusters experiencing labour market difficulties. With MSD and TEC we contributed to the development of regional skills/ employment forums in Taranaki, Bay of Plenty, East Coast, Wellington and Central Auckland to identify key issues for each region; and assisted with following up the issues raised. Further regional forums are planned for 2004/05. 27

28 DEPARTMENT OF LABOUR ANNUAL REPORT 2003/04 ACHIEVING OUR OUTCOMES We worked with MSD to develop innovative solutions to achieving sustainable employment outcomes, including: an evaluation of the individual jobs account pilot project the Sustainable Employment project to define appropriate measures to monitor sustainable employment outcomes for all benefit recipients on the unemployment register (ie including Sickness Benefit and Invalid Benefit clients who are registered). Initial measures and targets/standards for 2004/05 were agreed, and issues identified to be resolved in 2004/05 on what sustainable employment means for people with ill health or disabilities. Capacity and skill building through education policies With the Ministry of Education, Ministry of Social Development and Tertiary Education Commission, we are leading a project on Youth Transitions which aims to achieve Government s shared goal with the Mayors Taskforce for Jobs that by 2007, all year olds will be engaged in appropriate education, training, work or other options that will lead to long-term economic independence and wellbeing. We engaged with the Mayors Taskforce which brings together Mayors from across New Zealand to provide a national focus of leadership on the jobs issue and supported the Taskforce with specialist advice. Priority areas identified included improving careers information and guidance; vocational education and training; post-school support services; and developing a co-ordinated approach to supporting at risk youth. Key strategies for government attention in 2004/05 and following years were decided, and work commenced on second-tier priorities. We are leading support for young people with disabilities and identifying future job opportunities in industry. We scoped the problems facing young people with disabilities in making the transition from school to work, and are developing policy options for addressing the issues identified. With Waikato Polytechnic we undertook a pilot study of employment outcomes from tertiary education. Following evaluation of the pilot and discussions with the New Zealand Vice Chancellors Committee, further work was planned to gather information from the whole tertiary education sector. The Graduate Destinations survey will provide students and intending students with information on employment prospects and earnings, and will help tertiary institutions to determine and respond to labour market needs. For employers, it will show the number of students graduating from particular courses. We completed a youth labour market project which generated new information on the extent and nature of children s work, and included research on the impact of work on key outcomes such as educational attainment and future employment. The project also focused on what factors influence a successful transition for young people into work. 28

29 DEPARTMENT OF LABOUR ANNUAL REPORT 2003/04 ACHIEVING OUR OUTCOMES Employment for People with Disabilities We continued to provide legislative and policy support for the repeal of the Disabled Persons Employment Promotion (DPEP) Act, which aims to ensure that people with disabilities working in sheltered workshops have the same employment rights as people working in open employment. The repeal Bill had its first reading in May and is before the Select Committee. Work on identifying further measures to support the policy intent of the repeal is underway. We completed the first phase of a monitoring and evaluation plan for Pathways to Inclusion, the Government strategy for vocational services, and are engaging with MSD on the relationship of this work to the wider Sickness Benefit/Invalids Benefit strategy research and evaluation programme. As the first part of the wider Return to Sustainable Earnings programme for getting people back to circumstances in which their earnings are sustainable, we completed a major literature review looking at comparative international practice on getting injured people back to work. We provided community employment development assistance to communities that face significant barriers to labour market participation. Key Achievements in 2003/04 As part of the Jobs Jolt package, we launched Cyber Communities in April 2004 in three pilot communities - Otara, Tokoroa and Southland. Cyber Communities is a new employment partnership between government and communities which targets job sectors that need staff with information and communications technology (ICT) skills. Cyber Communities provides ICT training to long-term unemployed and disadvantaged people while they work with community organisations on ICT projects. Job seekers can then use their newly-gained skills in seeking permanent paid work. We continued to work in partnership with Maori and Pacific communities and disadvantaged urban and rural groups to build capacity to help overcome barriers to labour market participation. A key partnership approach is the Department s community employment Maori Tourism Strategy. Its three major delivery goals are building partnerships and alliances; extending communitybased networks by spreading success and improving communication; and building the commercial capability of Maori enterprises. A milestone during the year was the establishment of a virtual (online) Maori tourism incubator park which is now in use by small and medium sized tourism enterprises. We brokered local inter-agency relationships and co-ordinated areas of significant labour market adversity or change. Key Achievements in 2003/04 We worked with other government agencies in the central North Island to minimise the effects of potential job losses on forestry and related industry. We contributed to an inter-agency group considering responses to the impact of proposed phasing out of tariffs in the textiles, clothing and fabrics industry. 29

30 DEPARTMENT OF LABOUR ANNUAL REPORT 2003/04 ACHIEVING OUR OUTCOMES We worked with other government agencies in the February flood-affected areas of the lower and central North Island, to help co-ordinate support in areas of significant labour market adversity, and support communities in participating in the labour market under changed circumstances. We actively sought people from overseas with the skills we need and assisted them to settle and contribute in New Zealand. Key Achievements in 2003/04 Implementation of Skilled Migrant Category Following a comprehensive review of the General Skills component of skilled immigration policy, we introduced the new Skilled Migrant Category in December It is aimed at meeting New Zealand s identified skill needs and growth opportunities, and ensuring that skilled migrants gain successful employment here. The Skilled Migrant Category shifted the focus to actively recruiting the skilled migrants that New Zealand needs. Prospective migrants submit expressions of interest and points are allocated for skilled employment, work experience, qualifications and age. Submissions are pooled over a number of weeks and ranked from highest to lowest points scored. People selected from this pool fortnightly, in sufficient numbers to meet the annual Immigration Programme, are invited to apply for residence. Applicants may be granted residence at the outset if they have a New Zealand job or job offer, a higher qualification, or a qualification in an area of future growth or in an occupation in absolute shortage. Other applicants may be granted a work-to-residence work permit that allows them up to two years to establish ongoing skilled employment in New Zealand, at which point they can be granted residence. This new policy was put into practice using our longer-term immigration service delivery strategy, Customised Service. The Customised Service: Skilled Migrant (CS:SM) programme focuses on working more closely with customers and delivering skilled migrants who can settle well and contribute to New Zealand s economic and social wellbeing. We progressed a marketing strategy in support of CS:SM in key overseas target markets such as the UK and the USA to promote the Skilled Migrant Category and New Zealand as a migrant destination, and to identify potential migrants who can meet New Zealand s skill needs and opportunities. Several major promotional events were held in the UK, while three new Marketing Directors in the USA worked to identify potential migrants who can meet New Zealand s skill needs and opportunities. We upgraded and launched our new Immigration website which makes it quicker and easier for customers to find information on a wide range of topics. The Occupational Shortages List (OSL) and Priority Occupations List (POL) were updated and improvements were made to the way they are presented. The lists now include direct links to employment fact sheets for the occupations sought and additional information on associated industry, recruitment, training and registration bodies. These enhancements allow potential migrants to assess their skills, make personalised enquiries online and file online expressions of interest for the Skilled Migrant Category. 30

31 DEPARTMENT OF LABOUR ANNUAL REPORT 2003/04 ACHIEVING OUR OUTCOMES Settlement Services We continued to supply settlement services to migrants and refugees by entering into contracts with providers of employment assistance, orientation services and settlement assistance. The regular monitoring and evaluation of these contracts ensured the quality of the services provided, gave us valuable information about migrants settlement needs and helped understanding of migrant experiences. As part of Budget 2004, the Government announced the New Zealand Settlement Strategy which we are now leading. The new strategy brings together government agencies to provide a co-ordinated approach to services for migrants and refugees. In support of the Strategy, the Government will initially invest an additional $62 million over the next four years to assist in achieving good settlement outcomes. The Strategy s six goals for migrants, refugees and their families are that they: obtain employment appropriate to their qualifications and skills are confident using English in a New Zealand setting, or can access appropriate language support to bridge the gap are able to access appropriate information and responsive services that are available to the wider community (for example housing, education, and services for children) form supportive social networks and establish a sustainable community identity feel safe expressing their ethnic identity and are accepted by, and are part of, the wider host community participate in civic, community and social activities. Regulating Immigration Advice It is important that prospective skilled migrants receive accurate advice on migration to New Zealand and that they are treated fairly by those providing the advice. In May 2004, the Minister of Immigration announced Cabinet's agreement in principle to the regulation of immigration advice through a system of licensing. People who provide immigration advice, assistance or representations to an immigration applicant or to third parties will have to meet minimum standards, conform to a code of practice and be subject to disciplinary procedures. People who provide immigration advice without a licence will be subject to sanctions and penalties under the law, and the Department can refuse to accept applications from unlicensed people. Cabinet has agreed to exempt unpaid personal contacts and practising lawyers from licensing requirements. The objectives of regulation are to: enhance the ability of immigration applicants to make a well-informed choice of immigration agent reduce the risk of serious harm to those who use an immigration agent by creating effective incentives for agents to provide competent and ethical services provide clear and accessible complaint and redress procedures for those who use an immigration agent. 31

32 DEPARTMENT OF LABOUR ANNUAL REPORT 2003/04 ACHIEVING OUR OUTCOMES The licensing system will be administered by an independent governing body. The Department is developing the detail of the regulatory model and will report back to Cabinet by 1 December 2004 with further proposals and a framework for legislation. Stakeholder dialogues were held in the four main centres in late July SET AND ENFORCE STANDARDS Poor workplace practices can contribute to labour or skills shortages as prospective employees are unwilling to work for the pay or conditions offered, or in an unsafe work environment. Key Achievements in 2003/04 The Department s activities listed under Outcome 1 help to improve the quality of workplace conditions and so contribute to increasing participation in the workforce. Who we worked with to achieve this outcome We work with many agencies and community organisations to achieve this outcome. Key inter-agency relationships are with the Ministry of Social Development, the Tertiary Education Commission, Ministry of Education, and other key education agencies including Career Services and New Zealand Qualifications Authority. In the community and voluntary sector our key partners are organisations delivering settlement and refugee services; industry training organisations; local community and marae groups; and agencies including the Office for the Community and Voluntary Sector, the Department of Child, Youth and Family Services, Te Puni Kokiri, the Ministry of Pacific Island Affairs and Career Services. We work with local government throughout New Zealand to assist with local solutions to local problems, including close involvement with the Mayors Taskforce for Jobs. We also work closely with the Department of Internal Affairs, New Zealand Trade and Enterprise, and Ministry of Foreign Affairs and Trade on issues related to skilled migration. MINISTRY OF SOCIAL DEVELOPMENT (MSD) Steady employment growth leads to greater opportunities for participation by those currently unemployed. One of Government s main levers to improve labour market participation and outcomes, particularly for disadvantaged job seekers, is through employment assistance provided by the Ministry of Social Development. The Department of Labour provides Government with policy advice on employment issues, and purchase and monitoring advice on the performance of MSD in developing and delivering employment and training programmes to assist New Zealanders to get work. The outcomes MSD is seeking are: working-age people able to work achieve economic independence through sustainable employment working-age people who are unable to achieve economic independence have adequate income, the opportunity to engage in paid work and are able to participate in the life of their communities. These outcomes are aligned with the Department s employment goals and activities. 32

33 DEPARTMENT OF LABOUR ANNUAL REPORT 2003/04 ACHIEVING OUR OUTCOMES EDUCATION AGENCIES The Department of Labour works jointly with the Ministry of Education to provide purchase and monitoring advice to the responsible Minister for the Tertiary Education Commission (TEC). During 2003/04 the Department provided input into TEC s strategic planning process including its Statement of Intent for 2004/05, and developed a Partnership Agreement with the Commission. TEC s role is to increase the effectiveness of post-school education and training, and implement the Government s Tertiary Education Strategy. We work directly with the Commission to develop tertiary education strategy and policy. We also work with other key education agencies, including Careers Service and NZQA, to ensure that tertiary education strategy and policy includes a labour market and employment perspective, and that tertiary education organisations continue to provide programmes that are relevant to the needs of the workplace and the wider community. DEPARTMENT OF INTERNAL AFFAIRS (DIA) The Department of Labour and DIA are both seeking improved outcomes for migrants. Our activities are closely aligned with DIA s identity services and ethnic affairs work. The two agencies have developed a joint work programme to ensure our activities are co-ordinated to maximise their effectiveness for migrants. Work during 2003/04 included exploring possible future use of biometrics for identity purposes; information-sharing and other data management issues; and a working group on lost and stolen passports. Monitoring progress towards outcomes To assess progress towards this outcome during 2003/04 we monitored changes in the: growth in productivity, employment and wages labour force participation rates employment and unemployment rates job growth proportion of the workforce with a qualification percentage of skilled migrants with a relevant job offer percentage of skilled migrants in employment six months after arrival or approval. The results of this monitoring are reported in the Statement of Objectives and Service Performance section of this report under Vote Employment and Vote Immigration Environmental Information. 33

34 DEPARTMENT OF LABOUR ANNUAL REPORT 2003/04 ACHIEVING OUR OUTCOMES OUTCOME 3: MORE HIGH-QUALITY WORK OPPORTUNITIES The intermediate outcome we are seeking is: Increased high-quality work opportunities generated through more productive enterprises and enterprising communities Productive enterprises and enterprising communities This outcome supports the workplace and workforce outcomes by creating opportunities for individuals to work in high-quality workplaces. By supporting the growth and development of community innovation, long-term community wealth and wellbeing can be created. Supporting community development includes investment in new enterprises, which can lead to sustainable high-quality work opportunities. Through migrant investment and growth in tourism and international education sectors, immigration also supports the creation of high-quality work opportunities. What we did in 2003/04 towards achieving this outcome We explored ways our information, skills and resources could support people to create more productive business enterprises and job opportunities. Key Achievements in 2003/04 In addition to the points below, many achievements and activities listed under Outcomes 1 and 2 also helped or are helping us to better use the information, skills and resources we have. For example: through the work of the Workplace Productivity Working Group, Small Business Active Pilot, Small and Medium Enterprises Senior Officials Group, Labour Market Information Strategy, surveys of our customers (employment relations and OSH), WorkInfo and the Future of Work programme. We continued to partner with local groups to identify the success factors affecting community development through the Community Economic Development Action Research (CEDAR) project examining the link between development assistance and the achievement of community outcomes. Over the last three years, we worked with three pilot communities in Twizel, Napier and Christchurch to help them to recognise their own capability and needs, learn from their own past and generate their own goals and solutions for dealing with key issues facing their communities. This first phase of the project was completed in 2003/04 and provided understanding about how community organisations work, how field practice best contributes, and action research as a methodology for community 34

35 DEPARTMENT OF LABOUR ANNUAL REPORT 2003/04 ACHIEVING OUR OUTCOMES development work. These insights have been used to improve both our effectiveness and that of community groups work. The second phase of research focusing on how groups can be supported towards self-sufficiency is progressing two parallel strands of work: action research in two further pilot communities and learning sets for our fieldworkers. We began a review and clarification of the strategic focus of our community employment activities and funding in August The Department reported back to the Minister for Social Development and Employment and Cabinet in May 2004 on progress, with work continuing in these areas. The new strategic direction for community employment, as part of our Connecting for Outcomes project, will ensure a sharper focus on labour market outcomes. INFORM, EDUCATE AND ASSIST We supported enterprising and innovative community activity in communities facing limited opportunities to engage in high-quality work. Innovation and opportunities, spreading success across communities, and partnerships and alliances were priorities for investment and support through project advice and planning, network development and grants. Key Achievements in 2003/04 Community We continued to provide information on community employment development projects through the long-established Employment Matters publication with 12 editions published, and through the dedicated Employment Matters website. The website provides access to archival stories on a huge range of enterprise and development experiences to inspire and inform community responses to local opportunities. We increased the capacity of community groups by providing development assistance to community projects in vulnerable communities. Local fieldworkers throughout New Zealand used their expertise and networks to help communities and community groups take an idea and make it grow. We continued to support and invest in community enterprises to take up local opportunities for development under the Community Employment Organisation (CEO) initiative, including helping to build networking opportunities for CEOs to share and learn from the experiences of other CEOs. We continued to build the capacity of Maori and Pacific communities and community organisations by promoting successful models of capacity building through sharing of skills, information and knowledge. We continued to lead the Government s Connecting Communities Strategy, including hosting the Connecting Communities conference in November 2003 attended by approximately 450 community and government delegates, where community ICT priorities for the next five years were identified and made available on the website, We helped progress the Government's draft Digital Strategy led by the Ministry of Economic Development, particularly in the Investing in Communities and Individuals focus area and the steering committee for this work, and advising on community issues relating to other streams. We will be leading a cross- 35

36 DEPARTMENT OF LABOUR ANNUAL REPORT 2003/04 ACHIEVING OUR OUTCOMES government team in 2004/05 to consult with communities about the direction and content of the draft Digital Strategy. We ensured that new business migrants had information and support to identify viable business opportunities, make investment decisions and be well- placed to establish businesses that create employment opportunities. Through our longer-term service delivery strategy, Customised Service, we provided business migrants with customised information to ensure that they have the right information about business opportunities and settlement in New Zealand. We worked with tourism and education sectors in New Zealand and offshore to increase opportunities to reach tourists and students who will enter New Zealand, purchase our products and services and contribute to New Zealand business and enterprise. Tourism We set up a joint training project with Tourism New Zealand to improve systems for managing tourism from China by running training seminars for Approved Destination Status (ADS) agents (agents accredited by the Chinese Government), and by speeding up visa processing services for these agents. The ratio of visas for ADS tour groups to total Chinese visa applications has been slowly increasing over the last three financial years and the expansion of ADS and the training programme are expected to further increase the ratio. We were in frequent contact with tourism groups such as the Inbound Tour Operators Council (ITOC). In response to requests from ITOC about facilities at Auckland International Airport, a project team consisting of Customs (the lead agency), Department of Labour Immigration, the Ministry of Agriculture and Forestry, Treasury, Aviation Security and Auckland International Airport Limited was formed in 2004 to resolve a number of issues around passenger movements, flight clearances, agency facilities and increased flights. Education Within New Zealand: We worked with the Ministry of Education and the New Zealand Qualifications Authority to ensure that student immigration policy is consistent with the Education Act. When education providers closed, we provided assistance to affected international students to ensure that there was minimal inconvenience. To report on student immigration policy, procedures and service delivery we attended conferences and key meetings on export education, such as the Education New Zealand annual conference, the ISANA conference and the Export Education Promotions Reference Group. Offshore The Immigration Service Moscow Manager participated in a road show run by the Russia/NZ Education Network (REEN) in March. 36

37 DEPARTMENT OF LABOUR ANNUAL REPORT 2003/04 ACHIEVING OUR OUTCOMES The Immigration Service Beijing Manager was a member of the delegation supporting the Ministers of Foreign Affairs and Education during their visit to China to promote New Zealand s education opportunities. The Immigration Service s Beijing, Shanghai and Hong Kong Manager, in conjunction with Trade and Enterprise Commissioners, visited all Chinese provinces and presented student visa processing seminars for all registered student agents. Service Delivery We strengthened our services to people visiting or studying in New Zealand, or wishing to do so, by: holding student seminars offshore and onshore continuing the online facility for visitor visa applications launching in 2003 the Student Online (previously Streamlined Student) Application facility which is an on-campus system that allows education providers to send batches of permit renewals to us. As at June 2004, seven institutions were fully participating in Students Online and another six were in the implementation stage removing the need for overseas students to queue for their permit applications by providing enhanced services through other channels, such as online applications and drop boxes for applications. To encourage continued information sharing, we introduced monthly reports to export education providers on the number of foreign student permits revoked as a result of notifications from educational institutes. SET AND ENFORCE STANDARDS Key Achievements in 2003/04 The Department s activities that contributed to the previous two outcomes, related to improving workplace practices and conditions, and increasing participation and skills in the workforce, contribute to improvements in workplace productivity and more high-quality work opportunities. Who we worked with to achieve this outcome We continued to build relationships with communities to achieve this outcome. We worked with agencies such as the Ministry of Social Development; the Department of Internal Affairs Community Development Group; the Department of Child, Youth and Family Services; Te Puni Kokiri; the Ministry of Pacific Island Affairs; Career Services; and industry training organisations to ensure communities are able to make the most of the assistance available. We also worked with agencies in the community and voluntary sector, and continued to work with local government throughout New Zealand to assist with local solutions to local problems. The Department entered a partnership agreement with Creative NZ to support community employment opportunities arising from creative and arts-related regional development strategies. 37

38 DEPARTMENT OF LABOUR ANNUAL REPORT 2003/04 ACHIEVING OUR OUTCOMES We continued to build relationships with other government agencies, economic development agencies, local government, and industry groups to provide better information about the economic environment and business opportunities to prospective migrants. We also worked with government and non-government partners including the Ministry of Education, Education NZ, Tourism NZ, NZ Trade and Enterprise, regional tourism bodies and national associations, and educational institutions and organisations to ensure the ongoing quality, growth and sustainability of tourism and international education industries. Monitoring progress towards outcomes We expect that over time the Department s activities under this outcome will contribute to: increased investment in businesses and communities the creation of more job opportunities. To assess progress towards this outcome, during 2003/04 we monitored changes in the: growth in productivity, employment and wages (including GDP) labour force participation rates employment and unemployment rates job growth contribution of tourism and international education industries to GDP value of asset and investment transfers attributable to business migrants impact of immigration on education services. The results of this monitoring are reported in the Statement of Objectives and Service Performance section of the report under Vote Employment and Vote Immigration Environmental Information. 38

39 DEPARTMENT OF LABOUR ANNUAL REPORT 2003/04 ACHIEVING OUR OUTCOMES OUTCOME 4: MORE INTERNATIONAL INFLUENCE ON GLOBAL LABOUR AND SECURITY ISSUES AND INSTITUTIONS The outcome we are seeking to achieve is: Increased international influence on global labour and security issues and institutions through participation in international forums and fulfilling obligations. Increased international influence An ability to influence international decision-making is important for advancing New Zealand s international labour and security interests. It ensures we have a say in global matters that affect us. By participating in bilateral and regional trade initiatives we can create ongoing relationships based on collaboration, dialogue and cooperation. This also gives us the opportunity to advocate for improvements in labour standards, and ensure that existing standards are not undermined by parties to bilateral or regional trade agreements who may seek to gain trade advantages by undermining labour standards. By contributing to international standards that are relevant and effective in the modern world we can also be a good international citizen. We can build our influence by participating in international forums and initiatives, and fulfilling our obligations. We want to maintain and further enhance our reputation as a small but constructive and focused international player, and one that meets or exceeds its obligations. What we did in 2003/04 towards achieving this outcome IDENTIFY AND SHARE BEST PRACTICE We advocated New Zealand s interests in improving labour standards and ensuring existing standards are not undermined, by leading the labour component of bilateral and regional trade initiatives. Key Achievements in 2003/04 We provided input into the labour aspects of New Zealand s trade negotiations with other countries by providing advice to Government and promoting New Zealand s interests through effective representation at: the first round of Closer Economic Partnership (CEP) negotiations with Singapore and Chile in September 2003 the informal exploratory round on the labour component of the Closer Economic Partnership (CEP) trade negotiations in Thailand in May 2004 and the first formal round in New Zealand in June 2004 preparing for further negotiations with Thailand, China and the Pacific 3 trade negotiations preparatory work for possible future Free Trade Agreement negotiations. 39

40 DEPARTMENT OF LABOUR ANNUAL REPORT 2003/04 ACHIEVING OUR OUTCOMES A key opportunity to advance New Zealand s international labour and security interests is through international and regional forums. Through participation we can advocate New Zealand s interests and share information on best practice to contribute to the development of international standards. Key Achievements in 2003/04 Labour Interests We continued to provide advice as required to Ministers on relevant issues, including assessing the impact of international developments on New Zealand s labour interests, co-ordinating inter-departmental advice to Ministers on the implications of ratifying International Labour Organisation (ILO) Conventions, and reporting to Parliament on the texts of newly adopted ILO standards. We co-ordinated New Zealand participation in a wide variety of international and local events primarily through New Zealand s membership of the ILO, including arranging attendance of New Zealand delegates at the annual ILO Conference, three annual sessions of the ILO Governing Body and regional ILO conferences, and providing briefing material to delegates. We promoted New Zealand s interests through effective representation at: the November 2003, March 2004 and June 2004 sessions of the ILO Governing Body the 92 nd session of the International Labour Conference in June 2004 an Australian Workplace Relations Ministers Council meeting in Sydney in May 2004 the APEC-LSPN (Labour and Social Protection Network) annual meeting in Korea in May 2004 an ILO Declaration Seminar on the Application of the ILO Declaration of Fundamental Principles and Rights at Work in Bangkok in May 2004 a tripartite meeting on ILO issues with Australia in Sydney in May We fostered New Zealand s international reputation by hosting an ILO Subregional Forum on Decent Work in Auckland in October We co-ordinated New Zealand s input to the Asia-Pacific Economic Cooperation Human Resource Development working group, in partnership with the Ministry of Education. We fostered constructive and positive relationships with Business New Zealand and the New Zealand Council of Trade Unions through tripartite meetings prior to the ILO meetings to discuss priorities and areas of focus, and afterwards to discuss outcomes and follow-up action; and by providing them with improved information. We also consulted on all reports submitted to the ILO and related matters. We arranged visits to New Zealand by officials from ILO and other countries including Australia, Hong Kong, the Commonwealth, Korea and Thailand. We provided input into UNCROC Cabinet report back paper on child labour work programme. 40

41 DEPARTMENT OF LABOUR ANNUAL REPORT 2003/04 ACHIEVING OUR OUTCOMES Immigration We focused on advancing New Zealand s immigration interests through participating actively in key international engagements. These included: contributing to the annual Tripartite Consultations on Refugee Resettlement in Geneva and the Standing Committee meetings of Executive Committee (Ex Com) of UNHCR covering a range of refugee protection matters making a presentation to the APEC Business Mobility Group on New Zealand s implementation of APP in order to enhance other APEC countries confidence in deploying advance passenger information systems continuing to fund a seconded officer to the Pacific Immigration Directors Conference (PIDC) secretariat to increase awareness and technical skills of Pacific Island countries in terms of immigration systems attending a PIDC working group to discuss APP and implementation in the Pacific Region representing New Zealand at the 12th Session of the Facilitation Division of the International Civil Aviation Organisation (ICAO) which approved wide-ranging amendments to the ICAO Convention, including changes relating to the control of travel document fraud and illegal migration. New Zealand supported the call for greater compliance with the international standards and regulations necessary for the safety, security, efficiency and global standards of air transport, as specified in the ICAO Convention. participating in the ILO workshop which looked at labour and immigration issues relating to migrant workers and how ILO Members could co-operate to improve conditions and share best practice attending the APEC Senior Officials Meeting (SOM I) of the Informal Experts Group on Business Mobility (IEGBM) in Chile, and the Standing Committee on Immigration and Multicultural Affairs (SCIMA)/Ministerial Council of Immigration & Multicultural Affairs (MCIMA) bilateral meetings presenting a paper on the Skilled Migrant Category to the OECD Working Party on Migration. International Security We contributed to international forums working to enhance information exchange on, and establish common immigration standards to improve, international security. This included attending Combined Law Agency Group (CLAG) and Interagency Intelligence meetings and a Russian seminar on organised crime; liaising with Allied intelligence agencies (British Foreign Office and British Defence Intelligence Service), and visiting the Australian DIMIA intelligence unit. 41

42 DEPARTMENT OF LABOUR ANNUAL REPORT 2003/04 ACHIEVING OUR OUTCOMES INFORM, EDUCATE AND ASSIST Our reputation as a good international citizen is based on our reliability and willingness to fulfil international obligations. These include ensuring domestic compliance meets or exceeds international labour and security standards, ensuring effective border security, and resettling refugees. Key Achievements in 2003/04 Ensuring domestic compliance meets or exceeds international labour standards. We provided reports to the ILO about New Zealand s compliance in law and practice with ILO Conventions in accordance with the ILO s reporting requirements. These included reports on: how the provisions of ratified Conventions are given effect through law and practice in New Zealand progress made in implementing the principles underlying the core Conventions which New Zealand has not ratified (Convention 138 on Minimum Age and Convention 87 on the Freedom of Association and Protection of the Right to Organise) Conventions which New Zealand has not ratified, for an ILO General Survey on instruments concerning employment and training policies. We continued to oversee compatibility assessment work and co-ordinate interdepartmental advice to Ministers on the implications of ratifying ILO Conventions, in particular ILO Conventions 138 (Minimum Age) and 155 (Occupational Safety and Health). During the year, the Government continued to consider ratification of these two Conventions in line with New Zealand s approach to all international treaties whereby ratification is considered only where NZ domestic legislation, policy and practice fully comply with the provisions of the Convention. The Government deferred a decision to remove New Zealand s reservation to Article 32 of the United Nations Convention of the Rights of the Child (which requires a minimum age for employment) until assessment of ratification of ILO Convention 138 is completed. Resettling refugees In line with New Zealand s international obligations and the annual quota agreed by the Government, 812 UNHCR mandated refugees arrived in New Zealand and were settled into the community. These refugees included family members of refugees resettled from the Tampa emergency such as the immediate families of unaccompanied minors, known as the Tampa boys, and spouses and immediate families of refugees resettled from processing camps in the Asia-Pacific region. Refugees typically have additional resettlement needs, and research has confirmed that unemployment and poor English skills are major issues for recently-arrived refugees. However, with appropriate resettlement support and opportunities, many refugees do well in New Zealand and contribute to thriving communities and the economy. Accordingly, we continued to pay particular attention to ensuring that the additional settlement needs of refugees were met. 42

43 DEPARTMENT OF LABOUR ANNUAL REPORT 2003/04 ACHIEVING OUR OUTCOMES our Mangere Refugee Resettlement Centre continued to provide quota refugees with a range of initial educational and health services and a full orientation programme, which includes sessions on English language, the New Zealand schooling system, and information on services such as housing the initial reception and ongoing integration of these refugees into the community continued to be effected in partnership with other government and non-government organisations, through the volunteer sector and by purchasing settlement services from community-based agencies during the year, we continued to fund the Refugee and Migrant Service (RMS), a national, non-governmental organisation contracted to provide a range of settlement services to the UNHCR-mandated quota refugees, as well as some family members of refugees in New Zealand UNHCR continued to express its appreciation for New Zealand s policies, approaches and enactment of its international refugee protection role. Following their annual assessment of sample refugee status decisions to determine whether they meet international standards and guidelines, UNHCR commended the high quality of the decisions and of the refugee status determination processes. They also consider the services provided at the Mangere Centre for quota refugees and asylum seekers, and the procedures and operation of detention of asylum seekers, as exemplary and in accordance with UNHCR's guidelines on the detention of asylum seekers. UNHCR viewed the Mangere Centre as an open facility with an enlightened programme and services and not as a detention centre. We completed our three year Refugee Voices research project to provide information about the experiences of refugees resettling in New Zealand, and produced the final report, Refugee Voices: A Journey Towards Resettlement. Nearly all of the 398 refugees interviewed reported that New Zealand provided them with a safe and pleasant environment and that for the most part they encountered friendly and helpful people. Review of Samoan Quota and Pacific Access Category We reviewed the policies relating to the Samoan Quota and Pacific Access Category (PAC) which allow 1100 people from Samoa and 650 people spread between Fiji, Kiribati, Tonga and Tuvalu to apply for New Zealand residence each year. The Samoan Quota has been in operation for over 30 years and is considered evidence of the special relationship between Samoa and New Zealand, whereas the PAC has been in operation for only two years. Neither the Quota nor the PAC has been filled for the past two years, with the main issue appearing to be the inability of prospective applicants to obtain the necessary job offers. The review streamlined operational aspects of the two quotas and introduced Pacific Advisors to improve communication and to explore, with the Ministry of Social Development, private sector partnerships to assist prospective migrants into employment. 43

44 DEPARTMENT OF LABOUR ANNUAL REPORT 2003/04 ACHIEVING OUR OUTCOMES SET AND ENFORCE STANDARDS We need to manage risks inherent in many international developments. The heightened global security situation reinforces the need for robust immigration systems and an effective ability to respond to unplanned events. Key Achievements in 2003/04 We continued to concentrate on minimising the adverse impacts of immigration on the infrastructure, laws and policies of New Zealand. Risk management focused on improving inter-agency strategic coordination of border activities to facilitate entry while managing risk, and included a national conference on Minimising Adverse Outcomes - Intelligence Driven Enforcement. We continued to work with the Board of Airline Representatives of NZ (BARNZ), airlines, airports and other government agencies to ensure the smooth processing of international travellers. We made significant progress with the Advance Passenger Processing (APP) system which was rolled out to most airlines flying to New Zealand. By 30 June 2004, about 70% of all passengers flying into New Zealand were being screened using the APP system prior to boarding their flight. During the year 150 people were declined boarding under the APP system. We increased the level of our other border and investigation activities resulting in the number of people refused entry at the border increasing by 52%, and the number of undocumented passengers arriving in New Zealand dropping by 45%, compared to the previous year. We also liaised with embassies, consulates and MFAT to arrange the removal of illegal people in New Zealand, and with District Health Boards to remove people who do not have a right to health treatment here. A total 2,612 investigations and removals, section 35A permits and voluntary departures took place, 48% more than in 2002/ % of new failed refugees were removed or left New Zealand, which was significantly higher than the target of 50%. We continued qualitative research and interviewed people being removed on a custodial basis to gain an in-depth understanding of their entire lifecycle in New Zealand. This study will assist in developing strategies to decrease the number of people who stay illegally. We developed risk management approaches to ensure the integrity of the new Skilled Migrant policy. Work is continuing on risk profile analyses to establish new risk trends and applicant profiles, and to improve quality checks and verification work for application processing. We expanded our intelligence capability and systems, and by 30 June 2004 the new Immigration Intelligence Unit was fully staffed and on track with its programmes. The capacity of the Immigration Fraud Unit was also expanded and 182 charges laid during the year, compared with 48 cases in 2002/03. We undertook more successful joint operations with NZ Police, for example in the areas of people smuggling and identity fraud. We continued to review our preparedness to respond to humanitarian crises and updated our Humanitarian Crisis Plan after actively participating in the Operation Lawman exercise to test the readiness of all agencies to respond to a biochemical terrorism crisis. 44

45 DEPARTMENT OF LABOUR ANNUAL REPORT 2003/04 ACHIEVING OUR OUTCOMES We participated in the development of the DPMC mass arrival plan and interagency scenario planning for mass arrivals, and in UN Mass Arrival planning to ensure Pacific Island nations have the skills and understanding to implement a large-scale mass arrival plan. Who we worked with towards achieving this outcome Developing and maintaining strategic networks and relationships is critical to achieving this outcome. Within New Zealand, this includes close liaison with other government departments and agencies, particularly the Ministry of Foreign Affairs and Trade, the New Zealand Customs Service, the Department of Internal Affairs and New Zealand Police. The Department also maintains close relationships with Business New Zealand, the Council of Trade Unions, and non-government agencies. Externally, this includes the International Labour Organisation (ILO), United Nations High Commissioner for Refugees, other multilateral organisations, other governments (including our neighbours in the Asia-Pacific region), and non-government agencies. Monitoring progress towards outcomes We expect that over time the Department s activities under this outcome will contribute to New Zealand: participating effectively in international forums enjoying an enhanced international reputation having more influence on global labour and security issues. To assess progress towards this outcome, during 2003/04 we monitored changes in: New Zealand domestic law, policy and practice compared with ILO standards New Zealand s processing, assessment and detention procedures compared with UNHCR international standards New Zealand s refugee programme compared with other refugee receiving countries on a per capita basis. The results of this monitoring are reported in the Statement of Objectives and Service Performance section of the report under Vote Labour and Vote Immigration Environmental Information. 45

46 DEPARTMENT OF LABOUR ANNUAL REPORT 2003/04 CAPABILITY NEEDED TO ACHIEVE OUR OUTCOMES Capability Needed to Achieve Our Outcomes The development of the Department of Labour s four intermediate outcomes represents the convergence of several years of strategic thinking about how best to influence the working lives of New Zealanders for everyone s benefit. The Department has reviewed how its structures and systems contribute to achieving those outcomes. Outcomes Project The Outcomes project was established in 2001 to develop an outcome framework for the Department and develop the capability and frameworks to enable us to manage for outcomes. During 2003/04: we refined the Department s strategic direction to sharpen our focus on our unique role in the workplace and the labour market we revised our intermediate outcomes, reducing them from nine to four. The four new intermediate outcomes provided the basis for our Connecting for Outcomes changes We identified indicators to assess progress towards achieving our outcomes, and developed performance measures for activities that are outcome-focused and support the intermediate outcome indicators we have systems to capture data and report on some of these measures, and further work is planned for 2004/05 to implement systems for some of the new measures we reviewed departmental operations to ensure a better alignment to outcomes. Connecting for Outcomes For the Department to provide leadership in workplace and labour market issues we need to work together more effectively as one Department to focus policies, capability and services on meeting the needs of our customers. Connecting for Outcomes is the key project driving this major change. The first step in changing the operational style and focus of the Department was repositioning the Department s leadership team to provide stronger strategic support for the Department across all outcome areas, and better support service delivery. Repositioning our strategic leadership has significant implications for future organisational change, and represents a significant piece of work over 2004/05. The next steps in Connecting for Outcomes are aligning service delivery with each outcome, and establishing the capability we need to achieve those outcomes. This will involve building common systems and standards in key areas such as HR, IT, finance, planning, communications and information management, and in providing strategic support for the Chief Executive. Establishing this shared capability at a Departmental level is likely to require financial investment in the coming years. 46

47 DEPARTMENT OF LABOUR ANNUAL REPORT 2003/04 CAPABILITY NEEDED TO ACHIEVE OUR OUTCOMES Specific issues relating to Maori staff will be addressed through implementing our Maori staff development framework. In conjunction with the review of our strategic direction and Connecting for Outcomes, we reassessed current projects and programmes throughout the Department to build departmental capability, understanding and support mechanisms. Those projects that did not fully align with our strategic direction or did not directly contribute towards achieving our outcomes were either put on hold or terminated. Through working towards outcomes, our focus was increasingly on improving our capability to meet the needs of our customers. Meeting the Needs of Our Customers In addition to the projects and strategies summarised below, many of the activities and achievements under the earlier Achieving Our Outcomes section, and the research and evaluation listed in the Evaluation and Research section, have contributed or are contributing to our understanding of customers needs and how we can better meet these needs. For example: Workplace Productivity Working Group; Small Business Active Pilot; Small and Medium Enterprises Senior Officials Group, Labour Market Information Strategy; surveys of our customers (employment relations/osh); WorkInfo; Future of Work programme; Work/Life Balance and LEED. Actions to improve our systems for further understanding and to meet our customers needs include the WorkInfo programme; improvements to our communications channels and websites including websites dedicated to specific topics and/or projects; and increased visits, presentations and seminars. Other capability projects to meet our customers needs are covered below. Excellent Policy Advice Our Excellent Policy Advice project is aimed at lifting the quality of our external policy advice to Ministers, including operational policy advice. During 2003/04 we: completed a review of our processes for handling Official Information Act requests; and held workshops for staff to reinforce these processes collected information to inform the annual updating of our combined research/evaluation strategy shared work planning processes to improve the co-ordination of work planning across the Department collated project management resources onto a shared internet resource completed a review of recruitment issues for policy staff. Building and sharing our knowledge Understanding the New Zealand labour market is the fundamental capability of the Department of Labour. Through our analysis of trends in New Zealand s labour market we are able to develop policy and provide services that will make a positive difference to the working lives of all New Zealanders. 47

48 DEPARTMENT OF LABOUR ANNUAL REPORT 2003/04 CAPABILITY NEEDED TO ACHIEVE OUR OUTCOMES The Department is enhancing access to workplace information through better-aligned health and safety and employment-related service delivery. Workinfo is a cross-department initiative that will continue to be rolled out over 2004/05. The programme has included development and implementation of a suite of information and support systems to enable targeted interventions, tracking outcome achievement, and linking customers to the Department s bodies of knowledge. We developed, tested and circulated a community organisation evaluation and assessment tool, How are we doing? to our field staff to use with community groups. The tool was based on a US concept community scales. The second phase of the Community Economic Development Action Research (CEDAR) pilot commenced. CEDAR is a joint project with two streams - as well as action research and information-sharing in communities, CEDAR establishes three learning sets for Maori staff, Maori and Pacific women staff, and staff based in the Southern region. Customised service to migrants Customised service is a three-year strategy to help the Department change the way immigration services are delivered to customers, so we can more effectively increase New Zealand s capacity through immigration. It encompasses getting the right outcomes for New Zealand communities and businesses, and for the people who want to come to New Zealand to visit, study, work and live. Customised service is also about staff behaviours and principles such as integrity, judgement and interpersonal skills, and includes a staff training component. The first stage in 2003/04, targeted to skilled migrants, included developing operational policy, procedures and systems for the Individualised Customer Interaction, Decision Making and Keep in Touch stages of the Customer Lifecycle. Between now and 2006, these procedures will be used to expand the delivery of customised service to other immigration services. Immigration Communications Strategy A draft Immigration communications strategy was completed during the year to help communicate outcomes messages and the strategic direction of our immigration services to customers, stakeholders and staff. The first quarterly issue of Immigration Matters was distributed. This 'good news' publication is a component of our strategy to support 'creating a good host community' and is targeted to local and national media, and community outlets such as libraries, Citizens Advice Bureaux and schools. Three issues of Making It Work were distributed to employers and employer groups. This publication provides brief, targeted DoL information and tips on new initiatives, services, or compliance requirements, and links to helpful resources. Immigration service delivery The Department made good progress on several online initiatives for immigration service delivery. The key initiative in 2003/04 was the Students Online on-campus system for student permit renewal, which was formally launched during the second half of the year with full support from the participating institutions. Work also started to increase the usage of the Visitors Online service, which enables visitors to renew their permits online. 48

49 DEPARTMENT OF LABOUR ANNUAL REPORT 2003/04 CAPABILITY NEEDED TO ACHIEVE OUR OUTCOMES Significant progress was made on the Customised Service: Skilled Migrant IT strategy. The CS:SM programme brings together the Government s new Skilled Migrant policy with the Department s longer-term service delivery strategy, Customised Service. Online functionality supported potential skilled migrants registering an Expression of Interest (EOI) and being able to pay online. The response to the online service has been very positive, with more than 80% of EOIs coming through the online channel. Significant progress was made on Advance Passenger Processing (APP). At the end of June 2004 around 70% of all passengers flying into New Zealand were being screened using the APP system prior to boarding their flight. Building our internal capacity to meet the needs of customers Maori Strategy The Department s Maori Strategy, which builds on the collective experience, knowledge and skills of staff and their Maori networks, includes five key strategic goals to be progressed between : establish active relationships with other government departments to ensure a co-ordinated approach to achieving Government s key goals for Maori design products and services that will be effective in building Maori social and economic development increase the Department s capability to support Maori social and economic development develop direct linkages with Maori to achieve long-term sustainable relationships develop flexible and responsive policy and operational processes to ensure Maori participation. These goals align with the Government s key goals for Maori and provide a framework through which policy development and service delivery will meet Treaty of Waitangi obligations and respond to Maori needs, while including Maori in the process. While the strategy concentrates initially on internal capacity, the aim is to increase the Department s capability to improve our work in Maori communities, our ability to support Maori development, and to increase our understanding of Maori issues. During 2003/04, we continued our Nga Rangatahi Toa Maori Scholarships programme. We continued to provide financial support and mentoring to the three undergraduate scholars supported in 2002/03. Opportunities were sought to include these scholars in staff hui where these did not conflict with their studies. Through this programme the Department invests in increasing our own capability, as well as that of the Maori community through the wider networks the scholars represent. The Department s post-graduate scholarship was advertised during the year but has not yet been awarded. As a demonstration to staff of our commitment to training in te reo, the Strategic Leadership Team successfully undertook a course which will be followed up with further training. We are exploring ways of providing te reo, tikanga and Treaty awareness training through electronic media, to be available to all staff. We held a Maori staff network hui to strengthen Maori networks across our organisation and reinforce the value to the Department of our Maori staff. The Chief Executive and Strategic Leadership Team attended the hui, receiving and responding 49

50 DEPARTMENT OF LABOUR ANNUAL REPORT 2003/04 CAPABILITY NEEDED TO ACHIEVE OUR OUTCOMES to a challenge from Maori staff to increase the Department s responsiveness in the coming year. As part of the response to that challenge, and recognising the importance of recruitment and retention of Maori staff to our capability for responsiveness to Maori, a Maori Staff Development Framework has been designed to increase the numbers of Maori staff throughout the Department at all levels and in all disciplines. In working with Maori communities, our key focus continued to be a regional approach involving staff from across the Department. This practice has proved successful in responding to the preference of Maori communities for dealing with the Department as a whole. Pacific Strategy The Department s Pacific Strategy aims to ensure that we are well-equipped to provide the best possible assistance, information, support and advice to Pacific peoples and communities. It focuses on building the skills, knowledge and experience of all staff to address the needs of Pacific peoples; making better use of our existing networks; and strengthening relationships with the Pacific community. The Strategy s desired outcomes are: Leadership the Department of Labour will be recognised by Pacific peoples as a preferred employer who offers opportunities to staff. Building influence the Department of Labour will have strong internal networks and links with the Pacific community we serve, to help inform and influence our approach to how we work, and to inform policy development. Policy and service delivery the Department of Labour will be recognised as a mainstream agency that is a leading-edge provider of labour market policy advice and service delivery to Pacific peoples. Implementation of the Strategy during the year continued to be led by our Pacific Strategy Coach and the DoL Pacific Strategy Team. Our Pacific Strategy Coach provided advice and assistance to the Department on the implementation of the Strategy; and the DOL Pacific Strategy Team developed and progressed initiatives to achieve the above outcomes at the operational level. One highlight of the year was the Pacific Fono on 1 and 2 July 2003, aimed at strengthening the identity of Pacific people within the Department and the capacity of individual Pacific staff. It also provided an opportunity to build greater across-thedepartment understanding and networking. In the three years since the inception of our Pacific Strategy, positive results include an increase in the number of Pacific staff in the Department and in leadership positions, and an increase in positions with a Pacific focus. The strategy also underpinned our contribution to capacity-building in Pacific communities, work led by the Ministry of Pacific Island Affairs (MPIA). During 2003/04, the Department continued our involvement with the work of the MPIA through the Chief Executive Pacific Steering Group and through participation in the Pacific Capacity Building Programmes of Action (PCB), which was delivered in eight regions around the country. With MPIA, the Department conducted community feedback sessions with Community Reference Groups in Auckland on progress on the Pacific Capacity Building Programme of Actions Milestones. Other activity included continuing community training in immigration policy and procedures, working in partnership with Pacific community organisations, and assisting in strengthening the organisational capacity of Pacific groups. 50

51 DEPARTMENT OF LABOUR ANNUAL REPORT 2003/04 CAPABILITY NEEDED TO ACHIEVE OUR OUTCOMES As in the past three years, a highlight of the Department s collective activities in building relationships with Pacific peoples was representation at the annual Pasifika Festival at Western Springs, Auckland, in March With the changes to the Holidays Act and the Minimum Wage coming into effect on 1 April 2004, Pasifika provided a significant opportunity to get this information to the Pacific community. The Department s commitment to working proactively with Pacific peoples was further demonstrated through participation in many other Pacific events. These included the National Tongan Community Fono in Auckland in November 2003, the Te Tai Tokerau Pasifika Expo in Whangarei in April 2004, the annual AMCOR Family Safety Day in Manukau City in May 2004, regular Pacific Business Trust Networking evenings, and the Spacifically Pacific Careers Expo in Christchurch. Staff tooled up and supported Internal forums, including those for managers, staff, operational units and other specialised areas, are one mechanism the Department continued to use to inform and engage staff about work around outcomes. Partnership for Quality As the government department with responsibility for outcomes relating to work and workplaces, the Department needs to ensure that its own workplace practices model good practice. The development of a Partnership for Quality with the Public Service Association is one way we re doing this. The Partnership for Quality is part of a government-wide initiative to enhance the quality of working lives within the public service through an open and co-operative relationship between the Public Service Association and departmental management. It involves a continuing commitment by the PSA to improvements in quality, and the acceptance by government, employers and the union as stakeholders with rights and interests in decisions affecting employees work and employment. Partnership for Quality involves common ownership of plans, issues and problems. It involves direct collective participation of employees through their union and investment in their training, personal development and working environment. The Department is committed to developing a meaningful and sustainable Partnership for Quality. We ve establishing a joint steering group to develop a work plan for the coming year. Disability strategy The Department s Disability strategy, finalised in January 2002, contributes towards the Government s New Zealand Disability Strategy, which aims to identify how to remove barriers faced by people with disabilities to enable their full participation in society. Our strategy has three goals that focus on the Department as an employer, and as a deliverer of policy and operational advice and services. In 2003/04 an accessibility audit of 61 Department of Labour premises was conducted. Identified issues have been prioritised and will be followed up as actions in the Department s Disability Strategy workplan for 2004/05 and future years. The audit has assisted in raising staff awareness of minimum workplace accessibility compliance, with more frequent enquiries received about the suitability of building and workplace sites. The Department of Labour contributes to 17 websites. Most of these are monitored for compliance with government standards, including access for people with disabilities, at least 6-monthly. Significant work has been carried out in the 03/04 year to improve 51

52 DEPARTMENT OF LABOUR ANNUAL REPORT 2003/04 CAPABILITY NEEDED TO ACHIEVE OUR OUTCOMES compliance levels with the result that most DoL websites are now either fullycompliant or moving towards full compliance with e-government Guidelines. Staff have held seminars and talks with a number of disability groups and service providers to discuss health and safety and employment rights and obligations. We have also worked with disability groups to facilitate community employment activities. Health and Safety As part of our commitment to staff, health and safety is now embedded into daily work practices with the aim of best practice across the Department. Health and safety has been adopted as a prime business target, and specific training provided to all managers and health and safety representatives. A Health and Safety co-ordinator works across the Department, and technical expertise is provided to support health and safety representatives and line managers. Service health and safety committees have been established, together with regional and executive committees to deal with central issues. An intranet site has also been established and it provides all information on health and safety for all of the Department s workplaces. For the second year running we were successful in gaining admission to the ACC Partnership Programme at a tertiary level. Systems for services and support During 2003/04, we made progress on a number of systems projects to ensure that we have the robust infrastructure to support delivery of our outcomes. Electronic Channels Programme We continued to implement the Electronic Channels Programme (ECP) which includes developing and implementing a strategy to deliver services through the internet, phone systems and related emerging technologies. This programme is about giving our customers seamless access via electronic channels to Department of Labour information, services and transactions. Electronic channels are aligned with our Connecting for Outcomes programme to educate and enable customers as well as enforce legislated good practice. In 2003/04 we: progressed ECP through projects such as the Customised Service strategy, the Workinfo programme and Phase Two of WorkSite PaeMahi implemented an upgrade of our Information Technology (IT) infrastructure using technology that will create a single IT systems environment across the Department. This work is closely aligned with, and is the Department s response to, the overall e- Government strategy which the State Services Commission s (SSC) e-government unit is leading. The Secretary of Labour is a member of the e-government Advisory Board and the Department is represented on the shared workspace project steering committee. During the year, we also supported the SSC s e-government unit in other ways, for example, managing metadata for the e-government portal and active participation in the Linked Services Project. 52

53 DEPARTMENT OF LABOUR ANNUAL REPORT 2003/04 CAPABILITY NEEDED TO ACHIEVE OUR OUTCOMES Human Resources Management Information System (HRMIS). The aim of this project is to develop and implement an information technology system integrated across the Department to provide enhanced information about our staff and to allow us to better manage our staff, attend to their personal development, look after their health and welfare at work, and recognise and reward their contribution. In 2002/03, we scoped our strategic and operational information needs and identified the key milestones for implementation in 2003/04. Our new Human Resources Management Information System (HRMIS) went live in July 2003 with the move of the payroll to the new supplier; and September 2003 saw the merging of our six Service payrolls into one. A staff self-service kiosk on our intranet which allows staff to check their personal pay and leave details at any time went live in November With the bedding in of this facility we were able to cease printing and issuing payslips at the end of June A set of standard HR reports that managers will be able to access online were developed by the end of the 2003/04 year which will be available from early in 2004/05. 53

54 DEPARTMENT OF LABOUR ANNUAL REPORT 2003/04 HOW WE MANAGE RISK How We Manage Risk As a Department, we seek to balance an awareness of risk so it can be managed with an environment that encourages innovation and is responsive to customer needs. General risks to achieving outcomes include: - unexpected changes in our environment - lack of clarity around and adherence to operational policies - failings in systems and processes - inability to recruit or retain skilled staff - insufficient funding - loss of credibility with the public or government. Risk Management Framework During 2003/04, we developed a comprehensive risk management framework for the Department. The DoL risk management framework provides a structure to deal effectively with uncertainty and associated risk and opportunity; and, in doing so, support the achievement of the Government s outcomes whilst protecting our business activities and reputation. The framework constitutes our organisational capability to manage the impacts of risk on operations, or disruptions or adverse events that threaten assets and service activities. We started to embed this framework within the organisation to ensure that risks and risk management strategies are systematically identified and implemented and there is regular monitoring and reporting to further improve our management of risk. The key area of focus in 2003/04 was on NZIS. In accordance with the framework, NZIS has developed a strategic risk register and operational risk registers. NZIS branches and units report on the development and maintenance of their risk registers in the monthly Balanced Scorecard reports. The strategic risks and actions to mitigate these, identified through the registers, are then used to inform the annual planning process. We will embed the risk management framework throughout the organisation in 2004/05. Integrity of our Staff and Systems Following issues raised about the integrity and performance of staff and systems, we reviewed these and identified areas for improvement. Again, work to improve our processes, systems and controls was started in NZIS. 54

55 DEPARTMENT OF LABOUR ANNUAL REPORT 2003/04 HOW WE MANAGE RISK NZIS developed and implemented an Integrity Policy to communicate expected standards of behaviour to staff and to establish procedures for investigating possible breaches of standards. All NZIS employees were reminded of their obligations to: display high standards of integrity at all times report breaches or suspicions of integrity breaches that relate to fraud, corruption and dishonesty immediately. A one-day training package was undertaken by all staff on standards, expectations, values and ethics to reinforce the Code of Conduct and Integrity Policy. A new process for investigating possible fraud, corruption or dishonesty was implemented. An Assessment Team was established to oversee all investigations, to determine the most appropriate method for investigation and to decide on appropriate action following the conclusion of an investigation. An internal investigator position was established and filled for the first year by a senior officer on secondment from the Police. Work to improve our processes, systems and controls across the Department, including providing training to staff to ensure they fully understand their obligations and the Department s processes and policies, will continue to be a focus for the Department in 2004/05 and beyond. 55

56 DEPARTMENT OF LABOUR ANNUAL REPORT 2003/04 STATEMENT OF MANAGEMENT RESPONSIBILITY Statement of Management Responsibility In terms of sections 35 and 37 of the Public Finance Act 1989, I am responsible, as Chief Executive of the Department of Labour, for the preparation of the Department s financial statements and the judgements made in the process of producing those statements. I have the responsibility of establishing and maintaining, and I have established and maintained a system of internal control procedures that provide reasonable assurance as to the integrity and reliability of financial reporting. In my opinion, these financial statements fairly reflect the financial position and operations of the Department for the year ended 30 June Countersigned by: James Buwalda Brett Mudgway Secretary for Labour Chief Financial Officer 30 September September

57 DEPARTMENT OF LABOUR ANNUAL REPORT 2003/04 AUDIT REPORT AUDIT REPORT TO THE READERS OF THE DEPARTMENT OF LABOUR S FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2004 The Auditor-General is the auditor of the Department of Labour (the Department). The Auditor-General has appointed me, H C Lim, using the staff and resources of Audit New Zealand, to carry out the audit of the financial statements of the Department, on his behalf, for the year ended 30 June Unqualified opinion In our opinion the financial statements of the Department on pages 60 to 189: comply with generally accepted accounting practice in New Zealand; and fairly reflect: the Department s financial position as at 30 June 2004; the results of its operations and cash flows for the year ended on that date; its service performance achievements measured against the performance targets adopted for the year ended on that date; and the assets, liabilities, revenues, expenses, contingencies, commitments and trust monies managed by the Department on behalf of the Crown for the year ended 30 June The audit was completed on 30 September 2004, and is the date at which our opinion is expressed. The basis of the opinion is explained below. In addition, we outline the responsibilities of the Chief Executive and the Auditor, and explain our independence. 57

58 DEPARTMENT OF LABOUR ANNUAL REPORT 2003/04 AUDIT REPORT Basis of opinion We carried out the audit in accordance with the Auditor-General s Auditing Standards, which incorporate the New Zealand Auditing Standards. We planned and performed our audit to obtain all the information and explanations we considered necessary in order to obtain reasonable assurance that the financial statements did not have material misstatements, whether caused by fraud or error. Material misstatements are differences or omissions of amounts and disclosures that would affect a reader s overall understanding of the financial statements. If we had found material misstatements that were not corrected, we would have referred to them in the opinion. Our audit involved performing procedures to test the information presented in the financial statements. We assessed the results of those procedures in forming our opinion. Audit procedures generally include: determining whether significant financial and management controls are working and can be relied on to produce complete and accurate data; verifying samples of transactions and account balances; performing analyses to identify anomalies in the reported data; reviewing significant estimates and judgements made by the Chief Executive; confirming year-end balances; determining whether accounting policies are appropriate and consistently applied; and determining whether all financial statement disclosures are adequate. We did not examine every transaction, nor do we guarantee complete accuracy of the financial statements. We evaluated the overall adequacy of the presentation of information in the financial statements. We obtained all the information and explanations we required to support the opinion above. 58

59 DEPARTMENT OF LABOUR ANNUAL REPORT 2003/04 AUDIT REPORT Responsibilities of the Chief Executive and the Auditor The Chief Executive is responsible for preparing financial statements in accordance with generally accepted accounting practice in New Zealand. Those financial statements must fairly reflect the financial position of the Department as at 30 June They must also fairly reflect the results of its operations and cash flows and service performance achievements for the year ended on that date. In addition, they must fairly reflect the assets, liabilities, revenues, expenses, contingencies, commitments and trust monies managed by the Department on behalf of the Crown for the year ended 30 June The Chief Executive s responsibilities arise from the Public Finance Act We are responsible for expressing an independent opinion on the financial statements and reporting that opinion to you. This responsibility arises from section 15 of the Public Audit Act 2001 and section 38(1) of the Public Finance Act Independence When carrying out the audit we followed the independence requirements of the Auditor-General, which incorporate the independence requirements of the Institute of Chartered Accountants of New Zealand. In addition to the audit we have carried out assurance - related assignments in the areas of a review of quality improvements within the New Zealand Immigration Service, review of Community Employment Group s grant compliance standards, review of three Community Employment Group s grant funded projects carried out by the department s internal auditors and a quality assurance review of an information technology project. The assurance - related assignments are compatible with those independence requirements. Other than the audit and these assignments, we have no relationship with or interests in the Department. H C Lim Audit New Zealand On behalf of the Auditor-General Wellington, New Zealand 59