Strengthening internal systems and processes
NZAID’s work to strengthen internal processes and improve the way we implement, plan, monitor and evaluate
New Zealand's aid and development programmes.
NZAID has undergone rapid growth since its establishment in 2002. In the 2001/2002 financial year NZAID managed 600 international development contracts, and this grew to 950 in the 2008/09 financial year. Over the same period the aid and development budget increased from $227 million to $484 million. Further more, NZAID now has more than 200 staff working both in its Wellington office and at posts overseas.
By 2007 NZAID was aware that its rapid growth had led to pressure on systems and staff and had commenced work to address this. Two independent audits, a performance audit by the Office of the Auditor General (OAG) and Audit New Zealand’s annual statutory audit, found that the management control environment and contract management systems, processes and practices in Wellington and Posts for delivering aid programmes required major improvements.
NZAID’s response to audit recommendations
NZAID and the wider Ministry of Foreign Affairs and Trade acknowledged the seriousness of the audit findings and worked collaboratively and quickly to launch a two-year Control Environment Strengthening Programme (CESP) to strengthen NZAID's contracting and financial management processes.
The CESP has been a high priority for our agency and has involved:
- the development of a single NZAID policy and procedures manual for contract and financial management
- enhanced staff training in Wellington and at our Posts; good practice guidelines and new tools to improve overall understanding and adherence to policy and good practice
- enhanced internal scrutiny of contracts and grant funding arrangements as they are established and varied.
The CESP is overseen by a steering group which includes NZAID’s management team. Progress is monitored and reported to the Minister of Foreign Affairs.
Progress since 2007
Good progress has been made on the CESP and NZAID is on track to full implementation over the two year target timeframe. This is evidenced in the positive comments received from the OAG and Audit New Zealand in 2008 and 2009.
In late 2008 Audit New Zealand commented that:
“NZAID have done well to get to where they are in less than a year. To do this both in Wellington and the challenging environment in overseas posts is commendable.”
In early 2009 the OAG conducted a follow up of its 2008 performance audit and noted that:
“NZAID has responded positively and comprehensively to our performance audit recommendations. Overall, we found that NZAID had completed or partially completed work to implement more than half of our recommendations. Only one recommendation has yet to be progressed. For the rest of the recommendations, substantial work has been completed and some of the initiatives under way will continue as part of NZAID’s ‘business as usual’.
NZAID has focused its improvement work on its processes and controls for funding arrangements through the Control Environment Strengthening Programme. In our view, this has been an appropriate approach and a substantial amount of work has been carried out by NZAID as part of the Control Environment Strengthening Programme.”
NZAID will not be complacent and takes its responsibility as a guardian of public funds very seriously. NZAID is working to identify opportunities to strengthen systems and processes beyond the two year timeframe of the CESP.
Other internal improvement programmes and projects are under way, including the Project, which aims to streamline staff direction and guidance through the aid planning process.