Auditor-General's overview

Annual Report 2012/13.

The Government expects the public sector to deliver better public services with greater effectiveness and efficiency. This expectation has sparked changes in the public sector and in the way services are delivered, which has presented significant opportunities and challenges for my Office.

My Office's unique view of the entire public sector puts us in a position to help improve the performance of the public sector, and promote good accountability for that performance. In 2012/13, we used our observations of wider patterns and emerging trends, and our access to financial data, to add to debates and start new conversations. We have, for example, put forward a model of financial analysis using financial sustainability, reliability, and resilience, for others to debate and improve on.

I am pleased with our work that specifically addressed the theme of how well prepared the public sector is for our country's future needs. We have confidence that our report on biosecurity and the responses to that report will help to protect the country's economy and natural heritage in the long term. Our report on local authorities' most recent long-term plans added usefully to discussions about debt levels and financial prudence. In another report, we provided public entities with examples and "food for thought" about using social media effectively. In 2013/14, we will complete an overview of our work on future needs, and start our next theme-based work programme, which will look at how effectively services are delivered to the public.

It has been a challenging year for our inquiry work. A number of large inquiries and requests with significant political and media interest, combined with our routine work, contributed to a high workload. Our inquiry into Kaipara District Council's management of the Mangawhai community wastewater scheme is the largest that my Office has carried out for some years, and is exceptional in its complexity. We expect that the lessons learned from this inquiry will be important to many public entities.

This year, my Office prepared for its future by finalising a strategy with four main goals:

  • helping to build a stronger public sector,
  • striving to be a model organisation,
  • having a stronger focus on citizens, and
  • positioning our audit work for the future.

In line with our strategy, my staff explored ways to improve our services and the way we work. One example that worked particularly well was when we seconded staff from other public entities to help us to assess the strategy aimed at supporting Māori students to succeed. Being agile and able to adapt to change productively and cost-effectively has been important in our response to a rapidly changing public sector environment. For example, we have published our ageing population material as work has progressed, and we have started to use more types of social media to talk about and share our work.

Our latest client survey results indicate that we engage well with clients, and I acknowledge my staff's work to achieve these results. We remain alert to the need to seek improvements to meet our stakeholders' and clients' evolving needs.

We made good progress in addressing our long-term property needs. This year, after a capital injection from the Crown, our staff in Auckland and Wellington moved into newly refurbished premises. We were also very pleased to inform our Christchurch staff that we have signed a contract to lease space in a new building on the outskirts of Christchurch's central business district.

I have now completed half of my seven-year term as Auditor-General. Soon after I started, I said we would first focus on six significant matters. These six matters and our achievements are:

  1. Local government re-organisation in Auckland – Auckland Council was established on 1 November 2010. We have audited the transition, dissolution, 30 June financial statements, and two long-term plans. We have published seven parliamentary reports on Auckland-related matters, including this year's report on the transition and emerging challenges.
  2. Performance reporting – The overall quality of public entities' service performance information has improved. Audits increasingly give an opinion on the appropriateness of the service measures. To support this change, we have run workshops and produced publications. The challenge for entities and key stakeholders is to use this service performance information effectively and for accountability purposes.
  3. Analysis and reporting of sector information – We are continuing to increase our analysis and reporting of information and results by sector, and working more closely with sector representatives.
  4. Changes to financial reporting and auditing standards – New Zealand has adopted International Public Sector Accounting Standards with a tiered approach to reporting based on the size of the entity. We have actively supported these changes because we consider that they will, over time, improve the understandability and usefulness of financial statements. I remain committed to clearer, more useful reporting.
  5. Adding value through our annual audits, inquiries, and performance audits – My staff have actively considered how the public sector can gain the most value from the audit work we carry out. We will continue to focus on this, and it is a core part of our strategic direction.
  6. Identifying a theme to underpin our audits and other work – Our work programme in 2012/13 was the first with an underpinning theme. The results were pleasing and will be summarised to contribute to debates about how well the public sector is prepared for the future. Our focus for 2013/14 is on service delivery.

We are regularly told that other countries aspire to New Zealand's standard of public sector performance. Those who are governing, managing, and working in public entities can be justifiably proud of that reputation. However, we can never be complacent. My Office remains committed to maintaining and improving the quality of our public sector.

I thank all my staff and audit service providers for their support, commitment, and contribution to the work of the Office during the last three years and, in particular, for 2012/13. We are in a good position to meet our future challenges and to help improve the performance of, and the public's trust in, the public sector.

Signature - LP

Lyn Provost
Controller and Auditor-General

30 September 2013

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