List of access keys

2008 Annual Report

Report of the

Parliamentary Counsel Office
Te Tari Tohutohu Pāremata

for the year ended 30 June 2008

Presented to the House of Representatives under section 44(1) of the Public Finance Act 1989

ISSN 1177-6625

CONTENTS

Chief Parliamentary Counsel's Overview

Highlights of 2007/08

Strategic Objectives

Strategic Objective 1—Best Practice Legislative Drafting Services
Strategic Objective 2—Ready Access to New Zealand Legislation
Organisational health and capability

Financial Statements

Introduction to the Financial Statements
Statement of Responsibility
Statement of Financial Performance
Statement of Movements in Taxpayers' Funds
Statement of Financial Position
Statement of Cash Flows
Reconciliation of Net Surplus to Net Cash Flows from Operating Activities
Statement of Commitments
Statement of Contingent Liabilities
Statement of Unappropriated Expenses and Capital Expenditure
Statement of Operating and Capital Expenditure
Notes to the Financial Statements
Statement of Service Performance
Audit Report

Appendices

Legislative framework
Governance arrangements and structure in the PCO
Vision statement
PCO staff

 

The Attorney-General

I am pleased to present to you the Report of the Parliamentary
Counsel Office for the year ended 30 June 2008.

David Noble
Chief Parliamentary Counsel
22 September 2008

CHIEF PARLIAMENTARY COUNSEL'S OVERVIEW

David Noble, Chief Parliamentary Counsel.

This is the report of the Parliamentary Counsel Office (PCO) for the 2007/08 year. In preparing the report, the PCO has followed the guidance provided by the Treasury.1 This Annual Report, together with the PCO’s Statement of Intent,2 form the components of the Managing for Outcomes framework.

The mission of the Parliamentary Counsel Office is to:

  • provide high quality legislative drafting services and advice in a professional, impartial, and responsive manner
  • ensure, so far as it can, that New Zealand legislation is based on sound legal principles
  • ensure that New Zealand legislation is readily accessible.

The Statement of Intent for 2007–10 specified the outcome as “contributing to parliamentary democracy under the rule of law”.3 This is achieved by the PCO drafting legislation for the executive branch of government that reflects the fundamental concepts inherent in the rule of law, is clear, effective, and based on sound legal principle, and that is accessible to the New Zealand and wider public.4

Highlights of 2007/08

This year has been a year of significant achievement, delivery, and change for the PCO. The breadth of outcomes and the high quality work involved in delivering them are a tribute to the creativity and dedication of the whole PCO staff.

  • The PCO drafted 66 Government Bills (including two Members’ Bills) and 427 Statutory Regulations in the financial year ended 30 June 2008.
  • The Public Access to Legislation (PAL) Project was concluded and a new drafting and legislation-handling system, the New Zealand Legislation (NZL) system, was introduced into the PCO, the Inland Revenue Department, and the Office of the Clerk in November 2007.5
  • Associated with the conclusion of the PAL Project, the New Zealand Legislation website—a new, permanent legislation website at www.legislation.govt.nz (replacing the Interim Website)—was launched in January 2008 to provide free public access to legislation.
  • The process of officialising6 the content of the legislation website commenced in the latter part of the 2007/08 year and all the legislation for 2007 (other than the Income Tax Act 2007) was checked and officialised.
  • Fourteen Acts and two Statutory Regulations were issued as official reprints in addition to the legislation on the website that was officialised during the year.
  • PCO staff worked closely with the Law Commission, the Legislation Advisory Committee, and the Legislation Design Committee to improve the quality, clarity, and accessibility of New Zealand legislation.
  • Parliamentary Counsel continued to provide assistance with the development of advanced legislative drafting training for Pacific Island states in collaboration with the Pacific Forum and Commonwealth Secretariats.
  • David Noble took over from Ian Jamieson as Chief Parliamentary Counsel in November and a new senior management and group reporting structure was introduced following on from recommendations of the review of the PCO’s organisational structure and systems completed in 2007.7
  • The PCO hosted the New Zealand Law Librarians’ Association Symposium in June 2008.
  • Also in June, the PCO made a first transfer to Archives New Zealand of a substantial amount of archival material representing a significant contribution to the understanding of the political and legislative history of New Zealand.
  • The contract for the print and retail sales of New Zealand legislation was re-tendered.

STRATEGIC OBJECTIVES

Strategic Objective 1—Best Practice Legislative Drafting Services

The goal of this objective is to provide high quality legislative drafting services.

Drafting of Bills

It has been the practice of successive governments to adopt a legislation programme for the drafting of Bills in each calendar year, but no formal programme exists for the drafting of regulations. Bills are assigned categories on the legislation programme according to their legal and policy importance. The programme changes throughout the year as Bills are added to, or taken off, the programme, and delays in making policy decisions can delay the drafting of Bills.

The categories in the 2008 legislative programme as at 1 March 2008 were:

Category Description Number of Bills
1 Bills that must be passed or introduced as a matter of law in 2008 7
2 Bills that must be passed in 2008 35
3 Bills to be passed if possible in 2008 60
4 Bills to proceed to a select committee in 2008 56
5 Bills for which instructions are to be provided to the PCO in 2008 29
  Total 187

The PCO expects to draft all category 1 and 2 Bills for which instructions are received. As at 30 June 2008, the PCO had drafted six of those seven category 1 Bills and 29 of those 35 category 2 Bills. As at the same date, the PCO had drafted 38 of those 60 category 3 Bills, one of those 56 category 4 Bills, but had not received instructions for any of those 29 category 5 Bills.

Drafting amendments for select committees and committee of the whole House

Legislation is scrutinised extensively in parliamentary select committees, of which there are 13. With the exception of Appropriation, Imprest Supply, and Bills introduced and passed through all stages under urgency, all Bills are referred to a particular select committee for consideration. The process of select committee scrutiny of Bills usually involves the following features:

  • select committees are briefed by departmental advisers about each Bill that public submissions are called for
  • witnesses appear and give evidence at hearings that are open to the public
  • submissions are analysed and reports recommending changes to a Bill are prepared and considered
  • some committees engage independent advisers
  • amendments to a Bill required by the committee are drafted by Parliamentary Counsel in consultation with departmental advisers and considered by the committee
  • a commentary on the committee’s consideration of the Bill is prepared by the committee’s advisers and accompanies the Bill when it is reported back to the House.

Select committee consideration of Bills can occupy many months. The Bills may be extensively amended to take account of changes recommended by select committees following from the public submission process and the select committees’ overall consideration. Parliamentary Counsel attend meetings of select committees when departmental reports are considered and when the amendments to a Bill are decided upon. They will sometimes attend meetings to hear evidence from key witnesses. The drafting work involved can be considerable and time consuming.

Parliamentary Counsel also draft all amendments to Bills required by Ministers at the committee of the whole House stage. Extensive changes are possible at this stage of the legislative process to take account of policy changes or technical refinements that are necessary or desirable.

Law Commission

The PCO maintained a very constructive relationship with the Law Commission and during the year has seconded a Deputy Chief Parliamentary Counsel to assist it with legal research and drafting. The Waka Umanga (Māori Corporations) Bill, which was before the House as at 30 June 2008, arose from a Law Commission proposal and was drafted by the PCO. The Property Law Act 2007 and Sentencing Council Act 2007, which were both passed in the year under review, arose from Law Commission proposals and were drafted by the PCO. The PCO itself is the subject of a Law Commission review in the form of a review of the Statutes Drafting and Compilation Act 1920 and the associated work of the Commission on the presentation of New Zealand Statute Law and associated legislation (such as the Acts and Regulations Publication Act 1989). PCO senior management, Parliamentary Counsel, and other staff have contributed to both of these reviews during the course of the year.

Legislation Advisory Committee and Legislation Design Committee

The Chief Parliamentary Counsel is a member of the Legislation Advisory Committee (LAC) established by the Minister of Justice in 1986, and the Legislation Design Committee (LDC) established by Cabinet in June 2006. The LAC advises the Government on good legislative practice and scrutinises the legislative work of the Government, making submissions to select committee where appropriate. The LDC advises departments on the appropriate legislative architecture for significant or complex policy proposals requiring legislation. Parliamentary Counsel have been heavily involved in assisting both committees achieve their outcomes this year.

Drafting of Statutory Regulations

In the year under review, 427 Statutory Regulations were made. In the calendar year 2007, 408 Statutory Regulations were made. In general, Acts of Parliament contain the main policy components of a legislative regime while Statutory Regulations contain much of the essential detail and administrative mechanisms to make the Act work. It is often through such delegated legislation that a legislative regime has its greatest impact. All proposed Statutory Regulations that are to be made by the Governor-General in Council are considered by the Cabinet Legislation Committee and by Cabinet before they are submitted to the Governor-General in Executive Council. Unlike the drafting of Bills, drafting Statutory Regulations and other legislative instruments can give rise to complex legal questions about whether there is power to make the regulations or instrument under the relevant Act. Parliamentary Counsel are required to certify whether proposed Statutory Regulations are in order for submission to Cabinet, that is, whether there is any question about their vires and whether there is any ground on which they may be challenged under the Standing Orders of the House or disallowed under the Regulations (Disallowance) Act 1989.

Seventy-five exemption notices were drafted for the Securities Commission under the Securities Act 1978 and the Securities Markets Act 1988 and for the Takeovers Panel under the Takeovers Act 1993. These notices can be complex instruments and are often required at short notice. The PCO accords high priority to the requirements of the Commission and the Panel in this regard.

The PCO assists the Rules Committee, established under section 51B of the Judicature Act 1908. Rules of practice and procedure for the Supreme Court, Court of Appeal, High Court, and District Courts are made by the Governor-General by Order in Council with the concurrence of the Rules Committee. In the period under review, the PCO provided advice and legislative drafting services to the Rules Committee. This work included drafting amendments to the High Court Rules and District Courts Rules, and the preparation of draft revisions of those rules.

Clear drafting

The PCO’s goal for clear drafting is continuous improvement. During the development and commissioning phases of the New Zealand Legislation system, some changes were made to format and amending styles. Now that the NZL system is operational, it is expected that further progress will be possible in this area. For example, it may be possible to simplify the amending style in legislation that amends other enactments, and to improve the structure of amending enactments.

The guidance material available to PCO staff involved in drafting legislation includes the PCO Style Manual (which was fully revised in 2006) and the PCO Drafting Manual (which is nearing the end of a comprehensive review).

Assistance for departments

The PCO’s Guide to Working with the Parliamentary Counsel Office was revised and reissued in March. It provides guidance to assist departmental officials when instructing Parliamentary Counsel to draft legislation. This guide helps departments to work effectively with the PCO, particularly when giving instructions and responding to drafts. The Chief Parliamentary Counsel and other Counsel have also presented seminars on the subject to departmental officials and wider audiences this year.

Parliamentary Counsel provide advice to departments:

  • in the course of the development of policy for legislation
  • in the pre-instruction phase
  • during the drafting phase
  • at other times when required.

The subject matter of advice given by Parliamentary Counsel varies enormously. The context in which advice is sought is generally a specific piece of existing legislation or proposed legislation, but may include questions of drafting practice, the application of the LAC Guidelines, general legal principles, Cabinet procedure, parliamentary procedure, the effect of court decisions, and statutory interpretation. The PCO also arranged for the production of a more comprehensive index to the LAC Guidelines to assist departments’ use of the guidelines when instructing the PCO.

Contact with other jurisdictions

The Chief Parliamentary Counsel has participated in the Australasian Parliamentary Counsel’s Committee, particularly with regard to issues relating to common drafting approaches, access to legislation, and benchmarking measures. In addition, a Parliamentary Counsel attended the Commonwealth Association of Legislative Counsel Conference and the Commonwealth Law Conference in September 2007.

Quantity of legislation

The following graphs compare the number of Government Bills drafted and published and Statutory Regulations made and published, plus the numbers of SOPs drafted and published, in the financial years ending 30 June 2004 to 30 June 2008.

Number of Government Bills drafted and published (for the year ended 30 June)
The number of Government Bills drafted and published, from 2004 to 2008.
Number of Statutory Regulations made and published (for the year ended 30 June)
The number of Statutory Regulations made and published, from 2004 to 2008.
Number of Government Bills and SOPs drafted and published and Statutory Regulations made and published (for the year ended 30 June)
The number of Government Bills and SOPs drafted and published, and Statutory Regulations made and published, from 2004 to 2008.

Significant Bills and Acts

In the financial year under review, the following significant Bills were introduced and significant Acts passed. This PCO-drafted legislation can be viewed on the New Zealand Legislation website (www.legislation.govt.nz).

Bills

Affiliate Te Arawa Iwi and Hapu Claims Settlement
Affordable Housing: Enabling Territorial Authorities
Central North Island Forests Land Collective Settlement
Climate Change (Emissions Trading and Renewable Preference)
Commerce Amendment
Electricity Industry Reform Amendment
Family Courts Matters
Financial Advisers
Financial Service Providers (Registration and Dispute Resolution)
Immigration
Land Transport Management Amendment
New Zealand–China Free Trade Agreement
Policing
Public Health
Public Transport Management
Real Estate Agents
Residential Tenancies Amendment
Unit Titles
Waka Umanga (Māori Corporations)
Walking Access

Acts

Appropriation (2007/08 Estimates) Act 2007
Armed Forces Discipline Amendment Act (No 2) 2007
Copyright (New Technologies) Amendment Act 2008
Court Martial Act 2007
Court Martial Appeals Amendment Act 2007
Criminal Disclosure Act 2008
Education (Tertiary Reforms) Amendment Act 2007
Electoral Finance Act 2007
Human Tissue Act 2008
Injury Prevention, Rehabilitation, and Compensation Amendment Act 2008
Limited Partnerships Act 2008
Major Events Management Act 2007
New Zealand Geographic Board (Ngā Pou Taunaha o Aotearoa) Act 2008
Parole Amendment Act 2007
Property Law Act 2007
Sentencing Council Act 2007
Summary Proceedings Amendment Act (No 2) 2008
Terrorism Suppression Amendment Act 2007
Wills Act 2007

Strategic Objective 2—Ready Access to New Zealand Legislation

Public Access to Legislation Project

The PAL Project was designed to improve the way in which New Zealand legislation (Bills, Acts, Statutory Regulations, and Supplementary Order Papers (SOPs)) is handled in the drafting stages and made available to the public. The aim of the project was to provide public access to up-to-date official legislation in both printed and electronic forms.

This project is now complete. The project was implemented within the PCO, IRD, and Office of the Clerk in November 2007 and the New Zealand Legislation website (www.legislation.govt.nz) was launched in mid-January 2008. Electronic versions of draft and enacted legislation are now freely available via that internet site. The PCO has continued its commercial arrangement with the Knowledge Basket website,8 which provides access to historical legislation. Following the successful launch and full operation of the new website, the Interim Website of New Zealand Legislation was withdrawn on 30 June 2008.

The PAL Project implemented a complete, end-to-end, drafting, processing, and publishing system for the PCO. Working with a new XML authoring tool (Epic Editor) to draft and publish legislation is now becoming business-as-usual for the PCO and the other agencies affected by the changes. The PCO is committed to continuing to make enhancements to the system, taking into consideration the demands from Parliament, the public, and other external stakeholders, as well as ensuring that our main users in the PCO, IRD, and Office of the Clerk gain as much efficiency as possible. The system’s first major new release after go-live was successfully implemented at the beginning of June.

As with all major government IT projects, it has been necessary to undertake a formal post-implementation review. The normal time frame for such reviews is three to six months after implementation and their purpose is to assess and review the completed solution, determine whether or not the benefits have been achieved, and highlight what has been learned. This particular review will also consider the governance structures that have been set up to manage the PCO’s information systems, and make recommendations as appropriate. The final report is due early in the 2008/09 financial year.

The graphs below show unique visitor numbers, and bandwidth (in gigabytes), per month for the New Zealand Legislation website since it went live on 16 January 2008. They also include figures for the Interim Website of New Zealand Legislation for the 2007/08 year.9

Total number of unique visitors by month
The total number of unique visitors by month for the Interim Website and the New Zealand Legislation website.
Bandwidth by month (GB)
Bandwidth (GB) by month for the Interim Website and the New Zealand Legislation website.
Publication

The PCO’s contract with Legislation Direct (LD) to provide prepublication services for legislation ended on 29 February 2008. The PCO’s own Prepublication Unit (PPU) took over responsibility for all of the prepublication and publication functions that were previously undertaken by LD, and it also publishes legislation to the New Zealand Legislation website.

PPU is responsible for publishing, in hard copy and to the website:

  • new Acts
  • new regulations
  • Bills (both new Bills introduced to the House and subsequent versions of Bills)
  • SOPs
  • reprints of Acts and regulations.

Reprints

During the reporting period, the Reprints Unit published 3,732 pages of reprinted legislation (14 reprinted Acts and two reprinted Statutory Regulations). This reduction in volume from the 2005–2007 levels arises from concentration on the other priority activities of the Reprints Unit during the year. This meant that the PCO successfully updated the data for the New Zealand Legislation website in preparation for the launch of the site in January 2008, and then embarked on the PCO’s officialisation project to verify that all principal Acts and Statutory Regulations on the legislation website are accurate and that any amendments made to them have been compiled appropriately. “Officialisation” of the website content is currently expected to take at least three years to complete. In the reporting year, the PCO Reprints Unit completed the officialisation of 207 items of legislation, comprising all 2007 Acts and Statutory Regulations (apart from the Income Tax Act 200710) and 19 Acts and Statutory Regulations from 2006.

Total number of pages of reprints published (for the year ended 30 June)11
The number of pages of reprints published, from 2004 to 2008.

The Tables of New Zealand Acts and Ordinances and Statutory Regulations, and Deemed Regulations in Force (the Tables) as at 1 January 2008 were published in February 2008. This is the first edition of the Tables to include information on deemed regulations and the agencies who produce them. The cut-down electronic version was also updated to 1 January 2008, but was removed from the PCO website on 31 March 2008 as it was a duplication of information now provided on the New Zealand Legislation website.

Print tender

In December 2007, the PCO invited organisations to register their interest in the printing, storage, and distribution of Bills, Acts, Statutory Regulations, and related documents with effect from 1 August 2008, for a minimum period of three years.

Tender documents were sent to all those who registered an interest. An evaluation panel, with the assistance of specialist advisers, analysed the completed tender documents. SecuraCopy (a trading division of Blue Star Group) was selected as the preferred tenderer and detailed contract negotiations are currently in progress.

Further initiatives for improving access

The PCO is in contact with other agencies on access to legislation matters, monitoring developments in those other jurisdictions, and sharing information and knowledge.

In particular, the PCO maintained its knowledge of developments in access to legislation in other Australasian drafting offices through attendance at the Australasian Parliamentary Counsel’s Committee IT Forum held in Canberra in July 2007, and through informal contacts with staff in these other offices. There is a ready exchange of information through these contacts. For example, PCO staff were provided with early access to, and invited to provide feedback on, proposed enhancements to the legislation website provided by the New South Wales Parliamentary Counsel’s Office.12 Among the enhancements proposed are the introduction of e-gazettal (the official online notification of the making of statutory regulations) and official authorisation of the online legislative content on the New South Wales legislation website. Legislation is already in place in New South Wales to provide for both these developments, which have particular relevance for possible future enhancements to the New Zealand Legislation website.13 However, following completion of the PAL Project and the implementation of the new NZL system in the PCO, IRD, and Office of the Clerk, the PCO’s priorities within its current budget for the immediate future14 are to achieve simplification and greater resilience of the system rather than adding capacity and additional features to it.15

PCO staff also maintained contact with the Victorian Office of the Chief Parliamentary Counsel with respect to a project in that jurisdiction to back-capture, and make publicly available online, historical Victorian legislation dating back to 1851. This continuing contact has been valuable in contributing to the joint Law Commission/PCO project on the Presentation of New Zealand Statute Law.16

Responding to public interest in legislation

As anticipated, the number of enquiries received by the PCO since the go-live of the New Zealand Legislation website has increased substantially. For the period 1 January to 30 June, three times more enquiries were received in 2008 than in 2007. The enquiries have been responded to using existing PCO resources.

Organisational health and capability

Revised PCO structure

Following on from the appointment of David Noble as Chief Parliamentary Counsel in November 2007, a restructured Senior Management Team was created of Ian Jamieson as Deputy Chief Parliamentary Counsel (with responsibility for the legislative drafting and editing group), the newly appointed Paul de Wijze as Chief Information Officer (responsible for the access to legislation and IS group), and the Corporate Services Manager17 (responsible for the corporate services group). An Organisational Development and Human Resources Adviser has also been appointed (as recommended in the PricewaterhouseCoopers review18). A strategic human resources plan has been developed for implementation commencing from the beginning of 2008. Revised and clearer staff reporting lines were introduced, also in early 2008 (see the chart below).

PCO Organisational Chart.
Developments in human resources

The HR strategic plan identifies a number of major areas for reform, for example the performance appraisal and remuneration systems. It also included new initiatives for the PCO such as the GALLUP Q12 staff engagement survey and a Department of Labour Pay and Employment Equity Review (PEER).

During April the GALLUP Q12 staff engagement survey was administered with a 90% return rate, followed by teams reviewing their results and establishing action plans to be implemented over the 2008/09 year. The PEER review was successfully completed by 30 June 2008 (the shortest time for a PEER review) after a consultative approach by a committee consisting of staff representatives from across the PCO and a PSA representative. The PEER report was presented to the Chief Parliamentary Counsel and the Senior Management Team and the recommendations have since been accepted and their implementation is being coordinated with the HR strategic plan. Some recommendations that arose during the course of the review were implemented immediately by the Chief Parliamentary Counsel.

As at 30 June 2008, the staff gender breakdown is:

  Male Female Total
Total staff 33.4 43 76.4
Parliamentary Counsel 13.4 14.5 27.9
Other Drafting Services staff 4 3.7 7.7
Access to Legislation staff 13 11 24
Corporate Services staff 3 13.8 16.8

Note: Numbers of staff are full-time equivalents.

Research has commenced on the development of a competency framework for all positions in the PCO.

A new policy has been adopted covering KiwiSaver superannuation, and work has commenced on producing an HR manual for the PCO, creating a PCO job description template, and developing a personal records policy.

Recruitment, retention, and secondment of staff

This year has seen staff turnover increase to 15% (turnover was 7% in the 2006/07 year). This includes one Parliamentary Counsel who retired after 31 years’ service with the PCO, two staff members choosing not to return from parental leave, two Parliamentary Counsel moving to other legal posts in the New Zealand public service, and eight other staff resigning over the course of the year. The PCO has also instituted a secondment and exchange programme. In April a Parliamentary Counsel from the PCO exchanged posts with a member of the Office of Parliamentary Counsel in London for a year, and in March the Deputy Chief Parliamentary Counsel (Access) began a secondment to the Law Commission.

Transition from PAL Project to business-as-usual

The transition to the new drafting, processing, and publishing system (NZL system) following its in-house launch in November 2007 was smooth, as the office moved from project mode to business-as-usual. Staff training was completed satisfactorily, and the new methods and procedures have been successfully incorporated into regular PCO operating procedures.

Development Goals for the State Services

The completion of the PAL Project produced a milestone in accessible and networked state services. The PCO has demonstrated its commitment to being an employer of choice and a contributor to excellent State services through the GALLUP Q12 staff engagement survey, the PEER review, and the successful recruitment of high quality legal drafting, IT, and other staff during the course of the year. Work now planned on the review of competencies and leadership development will also contribute to these goals. An example of coordinated State agencies is the PCO’s effective contribution to, and cooperation with, both the LAC and LDC through the Chief Parliamentary Counsel and other Counsel in the PCO, together with instructing departments, to ensure that legislation achieves the desired outcomes. And finally the PCO’s contribution to the goal of trusted State services is reflected in the feedback received from the agencies instructing the PCO, including Judges on the Rules Committee and MPs on select committees.

Risk management

The PCO is establishing an Audit and Risk Committee with external representation and is planning to hold the first meeting of the committee in the first half of the new financial year.

Work is also progressing on developing a risk management framework and methodology for the PCO, which when implemented in the 2008/09 financial year will be the subject of regular reporting to the Audit and Risk Committee.

Records management and access to historical PCO records

In May 2008, the PCO implemented a formal records policy and reviewed the existing retention and disposal schedules. This will lead, in the 2008/09 financial year, to an application to Archives New Zealand for a revision of the PCO’s retention and disposal schedules. All of these are necessary steps toward full compliance with section 17 of the Public Records Act 2005, and Archives New Zealand’s Create and Maintain Standard. At the end of the reporting year, the PCO completed its transfer of all hard-copy administrative files of permanent value and all legislative drafting files closed before 1 January 1998 to Archives New Zealand. These comprise files formally scheduled for permanent retention as archives, as required by the PCO’s current retention and disposal schedules, Archives New Zealand’s General Disposal Authorities, and the Public Records Act 2005.

FINANCIAL STATEMENTS

FINANCIAL STATEMENTS OF THE PARLIAMENTARY COUNSEL OFFICE
For the year ended 30 June 2008

Introduction to the Financial Statements

The Parliamentary Counsel Office (PCO) is responsible for discharging the functions set out in the Statutes Drafting and Compilation Act 1920, and certain functions set out in the Acts and Regulations Publication Act 1989.

The PCO is funded by appropriation of money by Parliament.

The financial statements of the PCO for the year ended 30 June 2008, including the Statement of Service Performance, now follow.

STATEMENT OF RESPONSIBILITY
For the year ended 30 June 2008

In our opinion, the financial information presented in the Statements and Notes to the Financial Statements fairly reflects the position and operations of the PCO.

The PCO has a system of internal control, and this system has provided reasonable assurance as to the integrity and reliability of the financial report of the PCO.

In terms of the Public Finance Act 1989, I, David Noble, Chief Parliamentary Counsel, accept responsibility for the preparation of the financial statements and the judgements used in the financial statements.

David Noble
Chief Parliamentary Counsel
22 September 2008

Countersigned by:
Noel Lee
Corporate Services Manager
Parliamentary Counsel Office
22 September 2008

STATEMENT OF FINANCIAL PERFORMANCE
For the year ended 30 June 2008

30/6/07
 
Actual
$000
 
 
 
Notes
30/6/08
 
Actual
$000
30/6/08
Main
Estimates
$000
30/6/08
Supp.
Estimates
$000
  Revenue        
17,592 Crown   20,446 16,780 20,447
175 Other 2 179 153 213
17,767 Total operating revenue   20,625 16,933 20,660
           
  Expenses        
7,386 Personnel 4 7,859 9,025 8,846
6,613 Operating 5 7,971 5,800 9,511
398 Depreciation and amortisation 6 1,345 1,182 1,628
726 Capital charge 7 933 926 675
15,123 Total expenses   18,108 16,933 20,660
2,644 Net surplus/(deficit)   2,517 0 0

Note:
The accompanying Notes to the Financial Statements form part of these financial statements. For information on major variances against budget, refer to Note 23.

STATEMENT OF MOVEMENTS IN TAXPAYERS' FUNDS
For the year ended 30 June 2008

30/6/07
 
Actual
$000
 


Notes
30/6/08
 
Actual
$000
30/6/08
Main
Estimates
$000
30/6/08
Supp.
Estimates
$000
8,747 Taxpayers' funds brought forward as at 1 July   12,327 12,349 12,327
2,644 Net operating surplus 22 2,517 0 0
2,644 Total recognised revenues and expenses for the year   2,517 0 0
           
3,552 Capital contributions   1,437 200 1,437
(2,616) Provision for repayment of surplus to the Crown 22 (2,517) 0 0
12,327 Taxpayers' funds as at 30 June   13,764 12,549 13,764

Note:
The accompanying Notes to the Financial Statements form part of these financial statements. For information on major variances against budget, refer to Note 23.

STATEMENT OF FINANCIAL POSITION
As at 30 June 2008

30/6/07
 
Actual
$000
   
 
 
Notes
30/6/08
 
Actual
$000
30/6/08
Main
Estimates
$000
30/6/08
Supp.
Estimates
$000
  Taxpayers’ funds        
12,327 Taxpayers' funds   13,764 12,549 13,764
12,327 Total taxpayers' funds   13,764 12,549 13,764
           
  Represented by:        
  Current assets        
7,146 Cash and cash equivalents   5,425 571 1,073
66 Debtors and other receivables 8 732 0 0
125 Prepayments 8 164 19 19
0 Debtor—Crown   0 0 0
7,337 Total current assets   6,321 590 1,092
           
  Non-current assets        
876 Property, plant, and equipment 9 813 13,087 13,990
8,732 Intangible assets 9 10,858 0 0
9,608 Total non-current assets   11,671 13,087 13,990
16,945 TOTAL ASSETS   17,992 13,677 15,082
           
  Current liabilities        
1,246 Creditors and accruals 10 944 418 418
2,616 Provision for payment of net surplus 22 2,517 0 0
255 Provision for employee entitlements 13 354 422 399
4,117 Total current liabilities   3,815 840 817
           
  Non-current liabilities        
501 Provision for employee entitlements 13 413 288 501
4,618 TOTAL LIABILITIES   4,228 1,128 1,318
12,327 Net assets   13,764 12,549 13,764

Note:
The accompanying Notes to the Financial Statements form part of these financial statements. For information on major variances against budget, refer to Note 23.

STATEMENT OF CASH FLOWS
For the year ended 30 June 2008

30/6/07
 
Actual
$000
 


Notes
30/6/08
 
Actual
$000
30/6/08
Main
Estimates
$000
30/6/08
Supp.
Estimates
$000
  Cash flows from operating activities        
  Cash was provided from:        
  Supply of outputs        
19,151 —Crown   20,446 16,780 20,447
134 —Departments   (504) 118 243
19 —Other   12 35 35
292 —Net GST received        
19,596 Subtotal   19,954 16,933 20,725
           
  Cash was disbursed to:        
  Produce outputs        
(7,290) —Personnel   (7,862) (8,751) (8,457)
(6,992) —Operating   (8,111) (6,009) (10,478)
0 —Net GST paid 19 (187) 0 0
(726) —Capital charge   (933) (926) (675)
0 Other expenses   0 0 0
(15,008) Subtotal   (17,093) (15,686) (19,610)
4,588 Net cash flows from operating activities   2,861 1,247 1,115
           
  Cash flows from investing activities        
  Cash was provided from:        
75 Sale of property, plant, and equipment and intangible assets   33 0 0
           
  Cash was disbursed to:        
(1,822) Purchase of property, plant, and equipment and intangible assets   (3,436) (3,852) (6,009)
(1,747) Net cash flows from investing activities   (3,403) (3,852) (6,009)
           
  Cash flows from financing activities        
  Cash was provided from:        
3,552 Capital contributions received   1,437 200 1,437
           
  Cash was disbursed to:        
(2,119) Payment of net surplus to Crown   (2,616) 0 (2,616)
1,433 Net cash flows from financing activities   (1,179) 200 (1,179)
           
4,274 Net increase/(decrease) in cash held   (1,721) (2,405) (6,073)
2,872 Add opening cash brought forward   7,146 2,976 7,146
7,146 Closing cash to carry forward   5,425 571 1,073

Note:
The accompanying Notes to the Financial Statements form part of these financial statements. For information on major variances against budget, refer to Note 23.

RECONCILIATION OF NET SURPLUS TO NET CASH FLOWS FROM OPERATING ACTIVITIES
For the year ended 30 June 2008

30/6/07
 
Actual
$000
 


Notes
30/6/08
 
Actual
$000
30/6/08
Main
Estimates
$000
30/6/08
Supp.
Estimates
$000
2,644 Net surplus/(deficit)   2,517 0 0
  Add/(less) non-cash items:        
398 Depreciation and amortisation   1,345 1,182 1,628
64 Increase/(decrease) in non-current employee entitlements   (88) 0 0
462 Total non-cash items   1,257 1,182 1,628
           
  Add/(less) working capital movements:        
(129) Increase/(decrease) in debtors and prepayments   (705) 0 172
1,559 (Increase)/decrease in debtor—Crown   0 0 0
88 (Increase)/decrease in creditors and payables   (302) 0 (313)
(33) Increase/(decrease) in current employee entitlements   98 65 (372)
1,485 Working capital movements—net   (909) 65 (513)
           
  Add/(less) investing activity items:        
(3) Gain on sale of property, plant, and equipment 2, 3 (4) 0 0
0 Creditors for purchase of property, plant, and equipment and intangible assets   0 0 0
(3) Total investing activity items   (4) 0 0
4,588 Net cash flows from operating activities   2,861 1,247 1,115

Note:
The accompanying Notes to the Financial Statements form part of these financial statements. For information on major variances against budget, refer to Note 23.

STATEMENT OF COMMITMENTS
As at 30 June 2008

30/6/07
Actual
$000
  30/6/08
Actual
$000
  Capital commitments  
2,336 Less than one year 62
0 One to two years 0
2,336 Total capital commitments 62
     
  Operating commitments  
4,059 Less than one year 3,315
1,382 One to two years 2,582
2,860 Two to five years 6,025
133 More than five years 0
8,434 Total operating commitments 11,922
     
10,770 Total commitments 11,984

Note:
The PCO has accommodation and car park leases with the Reserve Bank. The PCO has a contract with Unisys New Zealand Ltd for the maintenance and support of the NZL system. The PCO has a contract with Brookers to maintain the PCO database. The PCO has no finance lease arrangements. The cleaning contract has not been disclosed as it is not significant in value.

Note:
The accompanying Notes to the Financial Statements form part of these financial statements.

STATEMENT OF CONTINGENT LIABILITIES
As at 30 June 2008

As at 30 June 2008, there are no contingent liabilities. (30 June 2007: nil.)

As at 30 June 2008, there are no guarantees or indemnities given under the Public Finance Act 1989 in respect of the activities of the PCO. (30 June 2007: nil.)

Note:
The accompanying Notes to the Financial Statements form part of these financial statements.

STATEMENT OF UNAPPROPRIATED EXPENSES AND CAPITAL EXPENDITURE
As at 30 June 2008

For the year ended 30 June 2008, there are no instances of unappropriated expenses or capital expenditure. (30 June 2007: nil.)

Note:
The accompanying Notes to the Financial Statements form part of these financial statements.

STATEMENT OF OPERATING AND CAPITAL EXPENDITURE
For the year ended 30 June 2008

30/6/07
Expenditure
Actual
$000
  30/6/08
Expenditure
Actual
$000
30/6/08
Appropriation
Voted1
$000
  VOTE: PARLIAMENTARY COUNSEL    
  Operating appropriations    
8,606 Law Drafting Services 8,958 10,004
6,545 Access to Legislation 9,150 10,656
15,151 Total operating appropriations 18,108 20,660
       
  Capital appropriations    
3,552 Capital appropriations to PCO 1,437 1,437
3,552 Total capital appropriations 1,437 1,437

1 This includes adjustments made in the Supplementary Estimates and transfers under section 26A of the Public Finance Act 1989.

Note:
The accompanying Notes to the Financial Statements form part of these financial statements.

NOTES TO THE FINANCIAL STATEMENTS
For the year ended 30 June 2008

Note 1 Statement of Accounting Policies
Reporting entity

The PCO is a government department as defined by the Public Finance Act 1989.

Basis of preparation

These are the financial statements of the PCO for the year ended 30 June 2008, which have been prepared pursuant to the Public Finance Act 1989. The PCO is a public benefit entity. Its primary objective is the drafting and publishing of legislation.

The financial statements have been authorised for issue on 22 September 2008 by the Chief Parliamentary Counsel and the Corporate Services Manager.

These financial statements have been prepared in accordance with, and comply with, NZ IFRS as appropriate for public benefit entities. This is the first set of financial statements prepared using NZ IFRS and comparatives for the year ended 30 June 2007 have been restated to NZ IFRS accordingly. Reconciliations of equity and net surplus/(deficit) for the year ended 30 June 2007 under NZ IFRS, to the balances reported in the 30 June 2007 financial statements, are detailed in Reconciliation of taxpayers’ funds as at 30 June 2007.

The following accounting policies, which materially affect the measurement of financial results and financial position, have been applied consistently to all periods presented in these financial statements.

The measurement base applied is historical cost.

The financial statements are presented in New Zealand dollars and all values are rounded to the nearest thousand ($000). New Zealand dollars is the PCO’s functional currency.

NZ IAS 1 Presentation of Financial Statements (revised 2007) replaces NZ IAS 1 Presentation of Financial Statements (issued 2004) and is effective for reporting periods beginning on or after 1 January 2009. The revised standard requires information in financial statements to be aggregated on the basis of shared characteristics and to introduce a statement of comprehensive income.

Budget figures

The budget figures are those presented in the Budget Night Estimates (Main Estimates) and those amended by the Supplementary Estimates and any transfer made by Order in Council under the Public Finance Act 1989.

Revenue

The PCO derives revenue through the provision of outputs to the Crown and for services to third parties. Such revenue is recognised when earned and is reported in the financial period to which it relates. Revenue is measured at the fair value of the consideration when received.

Cost allocation

The PCO has derived the costs of outputs using a cost allocation system outlined below.

Cost allocation policy

Direct costs are charged directly to significant activities. Indirect costs are charged to significant activities based on cost drivers and related activities/usage information. There have been no changes to the cost allocation policy from last year.

Criteria for direct and indirect costs

Direct costs are those costs directly attributed to an output.

Indirect costs are those costs that cannot be identified, in an economically feasible manner, with a specific output.

Direct costs assigned to outputs

Direct costs are charged directly to outputs. Depreciation and capital charge are charged on the basis of asset utilisation. Personnel costs are charged by actual time incurred. Property and other premises expenses, such as maintenance, are allocated on the basis of floor area occupied for the production of each output.

Basis for assigning indirect and corporate costs to outputs

Indirect costs are assigned to outputs based on a proportion of direct staff costs used for each output.

Trade and other receivables

Receivables are recorded at fair value, after providing for impairment. A provision for impairment of receivables is established when there is objective evidence that the PCO will not be able to collect all amounts due according to the original terms of the receivables.

Significant financial difficulties of the debtor, probability that the debtor will enter into bankruptcy, and default in payments are considered indicators that the debtor is impaired. The amount of the impairment is the difference between the asset’s carrying amount and the present value of estimated future cash flows, discounted using the original effective interest rate. The carrying amount of the asset is reduced through the use of an allowance account, and the amount of the loss is recognised in the schedule of departmental expenses. When a debt is uncollectable, it is written off against the allowance account for debtors. Overdue receivables that are renegotiated are reclassified as current (ie not past due).

Cash and cash equivalents

Cash and cash equivalents consists of cash in the bank and cash on hand.

Finance leases

A finance lease is a lease that transfers, to the lessee, substantially all of the risks and rewards incidental to ownership of an asset, whether or not title is eventually transferred.

At the commencement of the lease term, the PCO recognises finance leases as assets and liabilities in the Statement of Financial Position at the lower of the fair value of the leased item or the present value of the minimum lease payments.

The amount recognised as an asset is depreciated over its useful life. If there is no certainty as to whether the PCO will obtain ownership at the end of the lease term, the asset is fully depreciated over the shorter of the lease terms and its useful life.

Operating leases

The PCO leases premises. As the lessor retains substantially all the risks and rewards of ownership, these leases are classified as operating leases. Operating lease costs are expensed in the period in which they are incurred. Lease payments under an operating lease are recognised as an expense on a straight-line basis over the lease term.

Property, plant, and equipment and intangible assets

The initial cost of property, plant, and equipment is the value of the consideration given to acquire or create the asset and any directly attributable costs of bringing the asset to working condition for its intended use.

All property, plant, and equipment costing more than $1,000 plus GST are capitalised and recorded at historical cost.

Capital work in progress

Capital work in progress is not depreciated. The total cost of this work is transferred to the relevant asset category on its completion.

Depreciation and amortisation

Depreciation of property, plant, and equipment is provided on a straight-line basis so as to allocate the cost of assets, less any estimated residual value, over their useful lives.

The estimated economic useful lives and associated depreciation rates of major classes of assets are:

Furniture 5 years 20%
Office equipment 5 years 20%
Computer systems 3 years 33%
Motor vehicles 3 years 33%
Leasehold property improvements 6 years 16.67%
Intangible assets 5 to 10 years 20% to 10%
Leasehold property improvements

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

Intangible assets—software acquisition and development

Acquired computer software is capitalised on the basis of the cost incurred to acquire and bring to use the specific software.

The carrying value of an intangible asset with a finite life is amortised on a straight-line basis over its useful life.

Costs associated with maintaining computer software are recognised as an expense when incurred. Costs that are directly associated with the development of software for internal use by the PCO are recognised as an intangible asset. Direct costs include the software development, employee costs, and an appropriate portion of relevant overheads.

Disposals

Gains and losses on disposals are determined by comparing the proceeds with the carrying amount of the asset. Gains and losses on disposal are included in the Statement of Financial Performance. When revalued assets are sold, the amounts included in asset revaluation reserves in respect of those assets are transferred to taxpayers’ funds.

Impairment

Assets are tested for impairment annually.

Donated assets

Donated assets, with or without conditions, are valued at fair market value and recognised as revenue when control over the asset is obtained.

Provision for employee entitlements

Provision is made in respect of the PCO’s liability for annual, long service, retirement, and sick leave. Annual leave has been calculated on an actual basis at current rates of pay. Long service and retirement leave have been calculated on an actuarial basis based on the present value of expected future entitlements. Sick leave has been calculated on the past history of sick leave taken by all employees for the last three years to derive the average amount of accrued sick leave taken over and above the entitlement for the year. Sick leave has been actuarially assessed.

Defined benefit schemes

The PCO belongs to the Government Superannuation Fund (GSF). GSF is a defined benefit plan. It has been determined that the scheme is fully funded and as such no liability exists to be recognised by the PCO.

Defined contribution schemes

Obligations for contributions are recognised as an expense in the Statement of Financial Performance as incurred.

Foreign currency

Foreign currency transactions are converted at the New Zealand dollar exchange rate at the date of the transaction. When a forward exchange contract has been used to establish the price of a transaction, the forward rate specified in that foreign exchange contract is used to convert the transaction to New Zealand dollars. Foreign exchange gains and losses resulting from the settlement of such transactions and from the translation at year end exchange rates of monetary assets and liabilities denominated in foreign currencies are recognised in the Statement of Financial Performance.

Financial instruments

Revenue and expenses in relation to all financial instruments are recognised in the Statement of Financial Performance. Where the PCO enters into foreign currency forward contracts to hedge foreign currency transactions, any exposure to gains or losses on these contracts is generally offset by a related loss or gain on the item being hedged.

Goods and services tax (GST)

The financial statements are exclusive of GST, except for creditors and accruals, and debtors and other receivables, which are GST inclusive. All other statements are GST exclusive.

The amount of GST owing to or from the Inland Revenue Department at balance date, being the difference between output GST and input GST, is included in creditors and accruals or debtors and other receivables (as appropriate).

Taxation

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

Commitments

Future expenses and liabilities to be incurred on contracts that have been entered into at balance date are disclosed as commitments to the extent that they are equally unperformed obligations. Commitments relating to employment contracts are not disclosed.

Contingent liabilities

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

Taxpayers’ funds

This is the Crown’s net investment in the PCO. Taxpayers’ funds comprise revaluation reserves and general funds.

Critical accounting estimates and assumptions

In preparing these financial statements, the PCO has made estimates and assumptions concerning the future. These estimates and assumptions may differ from the subsequent actual results. Estimates and assumptions are continually evaluated and are based on historical experiences and other factors, including expectations or future events that are believed to be reasonable under the circumstances.

Statement of changes in accounting policies

There are no changes in accounting policies, including cost allocation policies, beyond those arising on transition to NZ IFRS and explained in Reconciliation of taxpayers’ funds as at 30 June 2007.

First time adoption of New Zealand Equivalents to International Financial Reporting Standards (NZ IFRS)

The PCO financial statements for the year ended 30 June 2008 are the first financial statements that comply with NZ IFRS. The PCO has applied NZ IFRS 1 in preparing these financial statements.

The PCO’s transition date is 1 July 2006. The PCO prepared its opening NZ IFRS balance sheet at that date. The reporting date of these financial statements is 30 June 2008. The PCO’s NZ IFRS adoption is 1 July 2007.

In preparing these financial statements in accordance with NZ IFRS 1, the PCO has applied the mandatory exceptions and no optional exemptions from full retrospective application of NZ IFRS.

The PCO is required to make the following mandatory exemption from retrospective application:

Estimates exemption—estimates under NZ IFRS at 1 July 2006 and 30 June 2007 are consistent with estimates made for the same date under previous NZ GAAP.

Reconciliation of taxpayers’ funds as at 30 June 2007

The following table shows the changes in equity resulting from the transition from previous NZ GAAP to NZ IFRS as at 1 July 2006 and 30 June 2007.

   
Previous
NZ GAAP

1 July 2006
$000
Effect on
transition
to NZ IFRS

1 July 2006
$000


NZ IFRS

1 July 2006
$000
 
Previous
NZ GAAP

30 June 2007
$000
Effect on
transition
to NZ IFRS

30 June 2007
$000


NZ IFRS

30 June 2007
$000
Current assets                
Cash and cash equivalents   2,872 0 2,872   7,146 0 7,146
Debtors and other receivables   1,621 0 1,621   191 0 191
Inventories   0 0 0   0 0 0
Total current assets   4,493 0 4,493   7,337 0 7,337
                 
Non-current assets                
Property, plant, and equipment a 8,256 0 8,256   9,608 (8,732) 876
Intangible assets a 0 0 0   0 8,732 8,732
Total non-current assets   8,256 0 8,256   9,608 0 9,608
                 
Total assets   12,749 0 12,749   16,945 0 16,945
                 
Current liabilities                
Creditors and other payables   1,158 0 1,158   1,246 0 1,246
Provision for repayment of net surplus   2,119 0 2,119   2,616 0 2,616
Employee entitlements b 266 50 316   233 22 255
Total current liabilities   3,543 50 3,593   4,095 22 4,117
                 
Non-current liabilities                
Provision for employee entitlements   409 0 409   501 0 501
Total liabilities   3,952 50 4,002   4,596 22 4,618
                 
Taxpayers' funds   8,797 (50) 8,747   12,349 (22) 12,327
Explanatory notes—reconciliation of taxpayers’ funds
  1. Intangible assets: computer software was classified as part of plant and equipment under previous NZ GAAP. The NZL system was classified under work in progress.
  2. Addition of provision for sick leave: sick leave was not recognised as a liability under previous NZ GAAP. NZ IAS 19 requires the PCO to recognise employees’ unused sick leave entitlement that can be carried forward at balance date, to the extent that the PCO anticipates it will be used by staff to cover future absences.
Reconciliation of surplus for the year ended 30 June 2007

Reported surplus for the year ended 30 June 2007 increased by $28,000 as a result of transition to NZ IFRS. This is due to the reduction in sick leave provision based on the valuer’s report. This is not reflected in the provision for repayment of surplus, as that repayment is based on previous NZ GAAP.

Statement of cash flows

There have not been any material adjustments to the Statement of Cash Flows for the year ended 30 June 2007, on transition to NZ IFRS.

Note 2 Revenue other
30/6/07
 
Actual
$000
  30/6/08
 
Actual
$000
30/6/08
Main
Estimates
$000
30/6/08
Supp.
Estimates
$000
3 Gain on sale of property, plant, and equipment 4 0 0
156 State Services Retirement Saving 163 118 178
16 Recovery of printing expenses 12 35 35
175 Total revenue other 179 153 213
Note 3 Disposal of property, plant, and equipment

During 2007/08, the following item was disposed of:

  Cost

$000
Accumulated
depreciation
$000
Gain/(loss)
on disposal
$000
Motor vehicle 41 12 4
Total 41 12 4
Note 4 Personnel expenses
30/6/07
 
Actual
$000
  30/6/08
 
Actual
$000
30/6/08
Main
Estimates
$000
30/6/08
Supp.
Estimates
$000
7,143 Salaries and wages 7,685 8,907 8,668
32 Annual, retirement, long service, and sick leave 10 0 0
211 Other personnel expenses 164 118 178
7,386 Total personnel expenses 7,859 9,025 8,846
Note 5 Operating expenses
30/6/07
 
Actual
$000
  30/6/08
 
Actual
$000
30/6/08
Main
Estimates
$000
30/6/08
Supp.
Estimates
$000
350 Consultancy 725 383 809
28 Audit fees to auditors for audit of the financial statements 29 22 30
0 NZ IFRS audit fee 5 0 0
0 Fees to auditors for other work 6 0 0
590 Operating lease rentals 654 546 673
4,117 Printing expenses 3,434 2,535 5,497
1,528 Other operating expenses 3,118 2,314 2,502
6,613 Total operating expenses 7,971 5,800 9,511
Note 6 Depreciation and amortisation charges
30/6/07
 
Actual
$000
  30/6/08
 
Actual
$000
30/6/08
Main
Estimates
$000
30/6/08
Supp.
Estimates
$000
190 Computer systems 208 996 1,438
28 Furniture 22 0 0
144 Leasehold property improvements 142 168 172
14 Motor vehicles 7 18 18
22 Office equipment 18 0 0
0 Intangible assets 948 0 0
398 Total depreciation and amortisation charges 1,345 1,182 1,628
Note 7 Capital charge

The PCO pays a capital charge to the Crown on taxpayers’ funds held as at 30 June and 31 December each year. The capital charge rate for the year ended 30 June 2008 was 7.5% (2007: 7.5%).

Note 8 Debtors and other receivables
30/6/07
Actual
$000
  30/6/08
Actual
$000
66 Debtors—Government 732
125 Prepayments 164
191 Total debtors and receivables 896

The PCO had not yet been reimbursed for these payments at balance date. The amounts outstanding are current (less than 30 days).

Note 9 Property, plant, and equipment and intangible assets
 

Furniture


Computers

Office
equipment
Leasehold
property
improvements

Motor
vehicles
Work in
progress
intangibles


Intangibles


Total
Cost or valuation                
Balance at 1 July 2006 324 1,452 146 1,345 70 7,205 0 10,542
Additions 8 147 1 49 31 1,527 0 1,763
Revaluation increase 0 0 0 0 0 0 0 0
Disposals 0 0 0 0 (30) 0 0 (30)
Write off 0 0 0 0 0 0 0 0
Balance at 30 June 2007 332 1,599 147 1,394 71 8,732 0 12,275
                 
Balance at 1 July 2007 332 1,599 147 1,394 71 8,732 0 12,275
Additions 12 340 4 6 0 (7,777) 10,851 3,436
Revaluation increase 0 0 0 0 0 0 0 0
Disposals 0 0 0 0 (41) 0 0 (41)
Write off 0 0 0 0 0 0 0 0
Balance at 30 June 2008 344 1,939 151 1,400 30 955 10,851 15,670
                 
Accumulated depreciation and impairment losses            
Balance at 1 July 2006 (252) (1,115) (64) (835) (20) 0 0 (2,286)
Depreciation expense (28) (190) (22) (144) (14) 0 0 (398)
Eliminate on revaluation 0 0 0 0 0 0 0 0
Eliminate on disposal 0 0 0 0 17 0 0 17
Write off 0 0 0 0 0 0 0 0
Impairment losses 0 0 0 0 0 0 0 0
Balance at 30 June 2007 (280) (1,305) (86) (979) (17) 0 0 (2,667)
                 
Balance at 1 July 2007 (280) (1,305) (86) (979) (17) 0 0 (2,667)
Depreciation expense (22) (208) (18) (142) (7) 0 (948) (1,345)
Eliminate on revaluation 0 0 0 0 0 0 0 0
Eliminate on disposal 0 0 0 0 13 0 0 13
Write off 0 0 0 0 0 0 0 0
Impairment losses 0 0 0 0 0 0 0 0
Balance at 30 June 2008 (302) (1,513) (104) (1,121) (11) 0 (948) (3,999)
                 
Carrying amounts                
At 1 July 2006 72 337 82 510 50 7,205 0 8,256
At 30 June and 1 July 2007 52 294 61 415 54 8,732 0 9,608
At 30 June 2008 42 426 47 279 19 955 9,903 11,671
Assets held for sale and impairment

The PCO does not have any items of property, plant, and equipment classified as held for sale. There were no impairment losses incurred during the year. There are no restrictions on title and no assets pledged as security for liabilities.

Intangible assets/property, plant, and equipment—the NZL system

The NZL system is the PCO’s integrated drafting and publishing system for New Zealand legislation.

The asset valuation was completed in accordance with NZ IAS 38 Intangible Assets. The asset was valued by PricewaterhouseCoopers as at October 2007.

The NZL system’s value has been assessed based on the appropriateness of the costs incurred to date and the valuer’s knowledge of the market. In estimating the useful life of the system the valuer has taken a prudent approach based on the useful life of similar assets in other government entities.

Intangible assets—acquired vs internally generated

All intangible assets are internally generated; therefore no separate disclosure is required for this asset category.

Note 10 Creditors and other payables
30/6/07
Actual
$000
  30/6/08
Actual
$000
263 Trade creditors 622
649 Accrued expenses 175
334 GST payable 147
0 Capital charge payable 0
1,246 Total creditors and other payables 944

Creditors and other payables are non-interest bearing and are normally settled on 30-day terms; therefore the carrying values of creditors and other payables approximate their fair value.

Note 11 Finance leases

The PCO has not entered into any finance leases.

Note 12 Leases

All leases are shown GST exclusive.

Lease expense

Property End date Up to 1 year
$000
1 to 5 years
$000
5 plus years
$000
Reserve Bank 14 April 2010 581 460 0
Car parks 14 April 2009 12 0 0
Total   593 460 0

Reserve Bank office lease: This lease is for the rental of office space on floors 4, 12, and 13 plus basement storage in the Reserve Bank building. The lease has a make-good provision where the lessee can either surrender the fit-outs and alterations to the lessor or remove these and make good. This lease is noncancellable.

Reserve Bank car park leases: These leases are for the rental of car park spaces in the Reserve Bank building and the adjoining building located on the corner of Mowbray and Bolton Streets. These leases are cancellable on the anniversary date.

There are no contingent rents on the above leases; they are all fixed term. There are no restrictions imposed by the lease arrangements.

There are no escalation clauses on the leases.

The Reserve Bank office lease has renewal dates of 15 April 2010 and 15 April 2013. This lease has an expiry date of 14 April 2016. The car park leases have renewal dates of 15 April 2010 and 15 April 2013. These leases have an expiry date of 15 April 2016. None of the leases have purchase options, so are operational leases by nature. The car park leases are automatically renewed annually unless a notice to cancel is provided.

Note 13 Provision for employee entitlements
30/6/07
Actual
$000
  30/6/08
Actual
$000
  Current liabilities  
34 Retirement and long service leave 45
199 Annual leave 287
22 Sick leave 22
255 Total current portion 354
     
  Non-current liabilities  
62 Long service leave 63
439 Retirement leave 350
501 Total non-current portion 413
756 Total provision for employee entitlements 767
Employee benefits

The PCO has employees who are members of the Government Superannuation Fund. This is a fully funded government scheme and, as a result, no liability is recognised.

An independent actuarial valuation was undertaken by Melville Jessup Weaver to estimate the value of long service leave, retirement leave, and sick leave as at 30 June 2008. The major economic assumptions adopted in the valuation process for long service and retirement leave were:

  • salary increase rate: 4% per annum (30 June 2007: 4%)
  • discount rate: 6.4% per annum (30 June 2007: 6.8%).

For sick leave the methodology was calculated according to the Treasury guidance and assumes that sick leave is a short-term compensated absence, as defined in NZ IAS 19.

Note 14 Contingencies

The PCO does not have any contingent assets as at 30 June 2008. (30 June 2007: $1.098 million performance bond issued by Unisys New Zealand.)

Contingent liabilities are separately disclosed in the Statement of Contingent Liabilities.

Note 15 Derivative financial instruments

The PCO does not hold any derivative financial instruments.

Note 16 Financial instruments

The PCO is party to financial instrument arrangements as part of its everyday operations. These include instruments such as bank balances, investments, accounts receivable, accounts payable, and foreign currency forward contracts. The fair value of the PCO’s financial instruments is the same as the carrying value.

The PCO does not have any gains or losses on its financial instruments and no impairments have been recognised to date.

All financial assets and liabilities are non-derivative in form and function and are neither available for sale nor held to maturity.

Credit risk

Credit risk is the risk that a third party will default on its obligations to the PCO, causing the PCO to incur a loss.

In the normal course of its business, credit risk arises from debtors, deposits with banks, and derivative financial instrument assets.

The maximum exposure from trade debtors is the value of the non-government debtors, ie $nil. Default is considered by management to be unlikely and the probable exposure has been determined as negligible. There were no changes in receivables or payables during the year that can be attributed to credit risk.

The PCO is only permitted to deposit funds with Westpac, a registered bank, and enter into foreign exchange forward contracts with the New Zealand Debt Management Office (NZDMO).

The PCO does not require any collateral or security to support financial instruments with financial institutions that it deals with, or with the NZDMO, as these entities have high credit ratings. For its other financial instruments, the PCO does not have significant concentrations of credit risk.

30/6/07
Actual
$000
  30/6/08
Actual
$000
  Loans and receivables:  
7,146 Bank balances 5,425
66 Debtors—Government 732

The PCO is not exposed to any other concentrations of credit risk.

Credit facilities

The PCO does not have bank overdraft facilities as at 30 June 2008.

Currency risk

The PCO has no significant exposure to currency risk on its financial instruments.

Currency risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in foreign exchange rates.

Interest rate risk

Interest rate risk is the risk that the fair value of a financial instrument will fluctuate, or the cash flows from a financial instrument will fluctuate, due to changes in market interest rates.

The PCO has no interest-bearing financial instruments and, accordingly, has no exposure to interest rate risk.

Liquidity risk

Liquidity risk is the risk that the PCO will encounter difficulty raising liquid funds to meet commitments as they fall due.

In meeting its liquidity requirements, the PCO closely monitors its forecast cash requirements with expected cash draw downs from the New Zealand Debt Management Office. The PCO maintains a target level of available cash to meet liquidity requirements.

The PCO considers that it does not have a significant liquidity risk as it ensures it has adequate working capital coverage at all times.

Exposure to risk

The PCO is not aware of any exposure to risk regarding financial instruments that would have a significant impact on operations.

Note 17 Capital management

The PCO’s capital is its equity (or taxpayers’ funds), which comprises general funds and revaluation reserves. Equity is represented by net assets.

The PCO manages its revenues, expenses, assets, liabilities, and general financial dealings prudently. The PCO’s equity is largely managed as a by-product of managing income, expenses, assets, liabilities, and compliance with the Government Budget processes and with Treasury instructions.

The objective of managing the PCO’s equity is to ensure the PCO effectively achieves its goals and objectives for which it has been established, whilst remaining a going concern.

Note 18 Provisions

With the exception of the provision for payment of the net surplus to the Crown, the PCO does not hold any non-employee related provisions.

Lease make good provisions

In respect of the Reserve Bank office lease, the PCO is required at the expiry of the lease term to either surrender to the lessor the fit-out and alterations or remove the improvements and make good any damage caused to the premises. The PCO has the option to renew this lease, which impacts on the timing of expected cash outflows to make good the premises. Given the long-term nature of the accommodation strategies for the PCO, it is unlikely that the make good provisions will crystallise. Therefore no provision has been raised.

Note 19 Cash flow

The GST (net) component of operating activities reflects the net GST paid to the Inland Revenue Department. The GST (net) component has been presented on a net basis, as the gross amounts do not provide meaningful information for financial statement purposes.

Note 20 Related party information

The PCO is a wholly owned entity of the Crown. The Government significantly influences the role of the PCO as well as being the major source of revenue.

The PCO enters into numerous transactions with other government departments, Crown agencies, and state-owned enterprises on an arm’s-length basis. These transactions are not considered to be related party transactions.

Those transactions that occur within a normal supplier or client relationship, on terms and conditions no more or less favourable than those that it is reasonable to expect the PCO would have adopted if dealing with that entity at arm’s length in the same circumstances, are not disclosed.

No provision has been required, nor any expenses recognised, for impairment of receivables from related parties.

Key management remuneration
30/6/07
Actual
$000
  30/6/08
Actual
$000
939 Salaries and other short-term employee benefits 924
0 Post-employment benefits 0
0 Other long-term benefits 109
0 Termination benefits 0
939 Total key management personnel compensation 1,033

There are no other employee benefits.

Key management personnel include the Chief Parliamentary Counsel and the Senior Management Team.

Apart from those transactions described above, the PCO has not entered into any related party transactions and there are no conflicts of interest recorded. The PCO has a policy on conflicts of interest and at each Senior Management Team Meeting any conflicts of interest are recorded.

Note 21 Post balance date events

The PCO does not have any post balance date events for 2007/08. (2006/07: nil.)

Note 22 Repayment of surplus
30/6/07
Actual
$000
  30/6/08
Actual
$000
2,616 Net surplus/(deficit) 2,517
Note 23 Major budget variances
Statement of Financial Performance

A net surplus of $2.517 million was recorded. This was owing to a number of factors. Significant factors are stated below.

There was a surplus of $0.992 million resulting from timing factors associated with the filling of vacant positions, as well as the number of staff on parental leave during the year.

There was a surplus of $1.479 million resulting from the costs of printing annual volumes and reprints, and software licences, being less than anticipated. However, additional costs of $0.420 million were incurred in extending the term of Legislation Direct’s obligation to provide prepublication services, owing to delays in the implementation of the NZL system.

Additional Crown revenue was provided by Cabinet for ongoing support and maintenance of the NZL system.

Ministerial approval was granted for the carry forward of funds totalling $1.988 million from the 2006/07 financial year to the 2007/08 financial year, for the purposes of:

  • accommodating additional staff within the Reserve Bank building through an extensive refit of the premises. Indicative costs of such a refit are in the range $1.26 million to $1.8 million (GST exclusive)
  • costs associated with a delay in the implementation date of the NZL system
  • reimbursing the State Services Commission for costs relating to the appointment of the Chief Parliamentary Counsel and the subsequent relocation and immigration expenses. The costs totalled $195,000 (GST exclusive)
  • printing costs for rewritten parts of the Income Tax Act 2007, which was passed in the 2007/08 financial year. The cost of printing was $348,000 (GST exclusive).
Statement of Financial Position

Total net assets increased by $1.437 million due to the completion of the NZL system. A valuation was carried out by PricewaterhouseCoopers and a total of $10.991 million was capitalised on 16 January 2008.

Note 24 NZ IFRS compliance

The PCO adopted New Zealand Equivalent to International Financial Reporting Standards (NZ IFRS) for its financial year beginning 1 July 2007. This is consistent with Treasury’s timetable for adoption, and requires NZ IFRS comparative information to be collected and reported from 1 July 2006. The PCO has reviewed the adoption of NZ IFRS and has not identified any significant changes to its results reported under the current Generally Accepted Accounting Practice. The PCO has identified itself as a public benefit entity.

STATEMENT OF SERVICE PERFORMANCE
For the year ended 30 June 2008

The PCO agreed to provide outputs in 2007/08 to meet the requirements of the Attorney-General in terms of their nature, outcome emphasis, quality and quantity specifications, and cost.

Output Class—Law Drafting Services

Description

Under this output class, the PCO delivered a service that provides for:

  • drafting Government Bills (including amendments) and Statutory Regulations
  • examining and reporting on local Bills and private Bills, and drafting amendments to them.
Outcomes

Contributing to parliamentary democracy under the rule of law by supporting Parliament and the executive in their law-making roles and contributing to the Government’s objectives by ensuring that legislation that is necessary to change the law to implement Government policies is effective, consistent with other legislation, the general law, and international law, and clear; and ensuring that, having regard to the policy of the legislation, it is also consistent with legal principle and with the rights and freedoms protected by the New Zealand Bill of Rights Act 1990 and the Human Rights Act 1993 and, in the case of delegated legislation, that it will withstand scrutiny by the Regulations Review Committee and challenge in the courts and will not be subject to disallowance under the Regulations (Disallowance) Act 1989.

Quantity

This output class is demand driven. It is accordingly difficult to estimate accurately the number of Government Bills and Statutory Regulations that will be drafted in any year, or the extent of the amendments required to Bills before the House.

  For the year ended 30 June
  2008 2007 2006
Measure Standard Actual Actual Actual
number of Government Bills drafted, and amendments to same number drafted during their passage through the House 50–70 drafted 66 drafted 42 drafted 33 drafted
number of local and private Bills examined, and amendments to them drafted 4–8 drafted,
and amendments drafted
to same number
7: 4 local
3 private
4: 2 local
2 private
2: 0 local
2 private
number of Members’ Bills drafted at the direction of the Attorney-General 4–8 drafted 2 drafted    
number of Statutory Regulations drafted 300–400 427 404 325

Note: The variance between actual and projected figures results from the difficulty in estimating demand.

For comparison purposes:

  For the year ended 30 June
  2008 2007 2006
Number of Government Bills enacted 1361 802 764
Number of Government Bills before the House of Representatives or awaiting Royal assent at the end of the year 56 393 25

1 Six of the Government Bills were drafted by the Inland Revenue Department; two began as Members’ Bills.
2 Three of the Government Bills were drafted by the Inland Revenue Department; three began as Members’ Bills.
3 Two of the Government Bills before the House of Representatives or awaiting Royal assent at the end of the year were drafted by the Inland Revenue Department.
4 Three of the Government Bills were drafted by the Inland Revenue Department.

Quality

The standard is:

  • Bills and Statutory Regulations are legally effective, consistent with other legislation, the general law, and international law, and clear
  • consistent with the policy they implement, Bills and Statutory Regulations are consistent with legal principle, the New Zealand Bill of Rights Act 1990, and the Human Rights Act 1993
  • advice given on matters relating to the provision of legislative drafting services, including advice on legislative drafting, parliamentary procedure, executive government process, and the law, is sound, practical, and clear.
  For the year ended 30 June
  2008 2007 2006
Measure Actual Actual Actual
the Attorney-General is satisfied that the quality standard has been achieved the A-G was satisfied the A-G was satisfied the A-G was satisfied
instructing departments and agencies are satisfied that the quality standard has been achieved, as determined from overall responses to the departmental satisfaction survey (target: 90% satisfaction rating) 94% satisfaction 68% response rate 93% satisfaction 97% response rate 95% satisfaction 94% response rate
select committees are satisfied that the quality standard has been achieved, as determined from overall responses to a survey The Justice and Electoral Select Committee stated: "We would like to thank the Parliamentary Counsel Office for all the work it has done to assist us in our consideration of the bills referred to us."1 not previously measured not previously measured
whether the PCO’s practices, systems, and processes relating to the drafting of legislation, in conjunction with external systems and processes relating to the enactment of statutes by Parliament and the making of Statutory Regulations by the executive, provide a reasonable level of assurance that the quality standard has been achieved PCO’s practices, systems, and processes, and external systems and processes, were applied during the year2 not previously measured not previously measured

1 Report of the Justice and Electoral Committee 2008/09 Estimates Vote Parliamentary Counsel.
2 The PCO is examining further possibilities to improve the quality, structure, and accessibility of legislation with parliamentary authorities and for bench-marking drafting services (Statement of Intent 2008–2011).

Timeliness

The standard is:

  • Bills, Statutory Regulations, and SOPs are drafted in accordance with time frames set by, or agreed with, the Government, select committees, and departments.
  For the year ended 30 June
  2008 2007 2006
Measure Actual Actual Actual
the Attorney-General is satisfied that the timeliness standard has been achieved the A-G was satisfied the A-G was satisfied the A-G was satisfied
instructing departments and agencies are satisfied that the timeliness standard
has been achieved, as determined from overall responses to the departmental satisfaction survey (target: 90% satisfaction rating)
94% satisfaction 68% response rate 93% satisfaction 97% response rate 95% satisfaction 94% response rate
select committees are satisfied that the quality standard has been achieved, as determined from overall responses to a survey The Justice and Electoral Select Committee stated: "We would like to thank the Parliamentary Counsel Office for all the work it has done to assist us in our consideration of the bills referred to us."1 not previously measured not previously measured

1 Report of the Justice and Electoral Committee 2008/09 Estimates Vote Parliamentary Counsel.

Financial performance for Output Class—Law Drafting Services
30/6/07
 
Actual
$000
  30/6/08
 
Actual
$000
30/6/08
Main
Estimates
$000
30/6/08
Supp.
Estimates
$000
8,761 Revenue—Crown 9,855 7,157 9,856
130 Other revenue 132 104 148
8,891 Total revenue 9,987 7,261 10,004
8,603 Total expenses 8,958 7,261 10,004
288 Net surplus 1,029 0 0

Note: Figures are GST exclusive.

Output Class—Access to Legislation

Description

Under this output class, the PCO delivered a service that provides for:

  • supplying printed copies of Government Bills and Government SOPs to the House and, on a selective basis, copies of Acts with proposed amendments incorporated
  • publishing printed copies of Bills and SOPs, pamphlet copies of Acts and Statutory Regulations, and annual volumes of Acts and Statutory Regulations
  • compiling reprints of Acts and Statutory Regulations with their amendments incorporated and publishing them
  • providing the above for sale at designated bookshops and by subscription
  • publishing the Tables of New Zealand Acts and Ordinances and Statutory Regulations, and Deemed Regulations in Force in printed form. The 1 January 2008 edition of the Tables is the first edition to include a list of deemed regulations and the contact details for the agencies that produced them. The electronic version of the Tables was withdrawn from the PCO website from 31 March 2008 as the functions previously provided by the electronic version of the Tables are now provided by the New Zealand Legislation website
  • providing free public access via the internet to an electronic database of Acts (both as enacted and with their amendments incorporated), Statutory Regulations (both as made and with their amendments incorporated), Bills, and SOPs, and maintaining the electronic database of legislation in an up-to-date form.
Outcomes

Contributing to parliamentary democracy under the rule of law by supporting Parliament and the executive in their law-making roles and contributing to the Government’s objectives by ensuring that legislation, including Bills and SOPs, is accessible to the public in both printed and electronic forms, and by providing printed copies of Government Bills and Government SOPs to the House.

Quantity

This output class is substantially demand driven. It is accordingly difficult to estimate accurately the number of Bills, SOPs, Acts, and Statutory Regulations that will be published in any year, or the number of printed copies of Bills and SOPs that will be provided to the House.

  For the year ended 30 June
  2008 2007 2006
Measure Standard Actual Actual Actual
number of Government Bills supplied to the House and published 50–70 68 45 35
number of Government SOPs supplied to the House and published 70–100 54 50 36
the number of Acts of Parliament published 80–120 143 84 78
the number of Statutory Regulations published 300–400 427 404 325
the annual volumes of Acts for 2007 and the annual volumes of Statutory Regulations for 2007 are published volumes are published for 2007 year 7 volumes of Acts, 4 volumes of Statutory Regulations for 2006 year 4 volumes of Acts, 7 volumes of Statutory Regulations for 2005 year 3 volumes of Acts, 6 volumes of Statutory Regulations
reprints of Acts and Statutory Regulations listed on the annual reprints programme are compiled and published 14 Acts 2 Statutory Regulations 14 Acts 2 Statutory Regulations1 35 Acts 9 Statutory Regulations 39 Acts 10 Statutory Regulations
publication in printed and electronic forms of the Tables of New Zealand Acts and Ordinances and Statutory Regulations in Force 2007 edition 2007 edition 2006 edition 2005 edition
publication of the interim indexes of Statutory Regulations indexes are published indexes were published indexes were published indexes were published
provision of free public access via the internet to an up-to-date electronic database of Acts (both as enacted and with their amendments incorporated), Statutory Regulations (both as made and with their amendments incorporated), Bills, and SOPs access is provided access was provided access was provided access was provided

1 In this period, the Reprints Unit updated the New Zealand Legislation website for its launch in January 2008, and officialised the 2007 legislation (220 Acts and Statutory Regulations) and commenced work on the 2006 legislation.

Quality

The standard is:

  • Government Bills approved for introduction and SOPs approved for release are published in an accurate form
  • accurate publication of Acts of Parliament
  • accurate publication of Statutory Regulations
  • the annual volumes of Acts for 2007 contain correct copies of the Acts of Parliament published in the volumes and the annual volumes of Statutory Regulations for 2007 contain correct copies of the Statutory Regulations published in them
  • reprints of Acts and Statutory Regulations correctly state the law enacted or made by the Acts and Statutory Regulations reprinted and by the amendments to that legislation
  • the Tables of New Zealand Acts and Ordinances and Statutory Regulations, and Deemed Regulations in Force are accurate
  • the interim indexes of Statutory Regulations are accurate
  • the electronic database of Acts (both as enacted and with their amendments incorporated), Statutory Regulations (both as made and with their amendments incorporated), Bills, and SOPs is up to date and accurate
  • Bills, SOPs, Acts of Parliament, Statutory Regulations, the annual volumes, reprints, and the Tables of New Zealand Acts and Ordinances and Statutory Regulations, and Deemed Regulations in Force are published in accordance with best industry practice.
  For the year ended 30 June
  2008 2007 2006
Measure Actual Actual Actual
whether the Attorney-General is satisfied that the quality standard has been achieved the A-G was satisfied the A-G was satisfied the A-G was satisfied
in relation to reprints, whether an external expert is satisfied that the quality standard has been met, based on an assessment of selected reprints PCO is in the process of selecting an external assessor not previously measured not previously measured
whether the PCO’s practices, systems, and processes relating to the publishing of Bills, SOPs, and legislation and to the compilation and publishing of reprints and the Tables of New Zealand Acts and Ordinances and Statutory Regulations in Force provide a reasonable level of assurance that the quality standard for publication has been achieved PCO’s practices, systems, and processes, and external systems and processes, were applied during the year1 not previously measured not previously measured
the number of publishing errors reported in the legislation that is published in printed and electronic forms (target: fewer than 10) 6 not previously measured not previously measured

1 The PCO is examining further possibilities to improve the quality, structure, and accessibility of legislation with parliamentary authorities and for bench-marking drafting services (Statement of Intent 2008–2011).

Timeliness
  For the year ended 30 June
  2008 2007 2006
Measure Standard Actual Actual Actual
the time taken to supply Government Bills and SOPs to the House in accordance with the requirements of the Ministers of the Crown in charge of those Bills or SOPs met not previously measured not previously measured
the time taken to make legislation (including Bills and SOPs) available for sale at designated bookshops and by subscription Acts: within 10 working days of introduction or release Statutory Regulations: within 5 working days of being made Acts: most within 10 working days1 Statutory Regulations: all within 5 working days Acts: most within 10 days Statutory Regulations: all within 5 working days Acts: most within 10 days Statutory Regulations: all but 1 within 5 working days
the date of publication of the annual volumes of Acts and Statutory Regulations within first half of 2008 for 2007 year April 2008 for 2006 year within first half of 2007 for 2005 year within first half of 2006
compilation of reprints in accordance with the annual reprints programme   met met met
the date of publication of the Tables of New Zealand Acts and Ordinances and Statutory Regulations, and Deemed Regulations in Force, and the frequency with which the electronic version is updated printed version: within first half of 2008 electronic version: at least twice printed version: March electronic version: met2 printed version: met electronic: not previously measured printed version: met electronic: not previously measured
the dates of publication of the interim indexes of Statutory Regulations 4 times a year 4 times a year 4 times a year 4 times a year
the frequency with which the database of legislation is updated as Bills are introduced and pass through the House, SOPs are released, Acts and Statutory Regulations are enacted and made, and the frequency with which Acts and Statutory Regulations are published in up-to-date form with their amendments   as required N/A N/A
the availability of the electronic database of Acts, Statutory Regulations, Bills, and SOPs. 24/7 met met met

1 Three Acts out of 143 took longer than ten working days after assent to be printed and made available in bookshops. One of these Acts was large (2,855 pages) and had to be printed and bound as a five-volume set, and took 35 working days to produce and make available. Unbound proofs of the set were made available for viewing at retail outlets that stock legislation until printed and bound copies became available. Another of these Acts was assented to in the lead up to the Christmas holiday period, and took 16 days to be printed and made available. The third Act took 12 working days to be made available because of the need to correct a printing error.
2 The electronic version of the Tables was withdrawn from the PCO website from 31 March 2008 as the functions previously provided by the electronic version of the Tables are now provided by the New Zealand Legislation website.

Financial performance for Output Class—Access to Legislation
30/6/07
Actual
 
$000
  30/6/08
Actual
 
$000
30/6/08
Main
Estimates
$000
30/6/08
Supp.
Estimates
$000
8,831 Revenue—Crown 10,591 9,623 10,591
42 Other revenue 47 49 65
8,873 Total revenue 10,638 9,672 10,656
6,545 Total expenses 9,150 9,672 10,656
2,328 Net surplus 1,488 0 0

Note: Figures are GST exclusive.

Overall financial performance

The financial performance of the PCO for the year ended 30 June 2008 resulted in:

  30/6/08
Actual
30/6/08
Estimated (Supp)
30/6/07
Actual
Operating results        
Revenue—Crown $000 20,446 20,447 17,592
Revenue—other $000 179 213 175
Output expenses $000 18,108 20,660 15,123
Other expenses $000 0 0 0
Net surplus/(deficit) $000 2,517 0 2,644
         
Working capital management        
Liquid ratio % 142 131 174
Debtor collection period (third party sales) days 0 0 0
Creditor payment period days 28 28 28
         
Resource utilisation        
Property, plant, and equipment (PPE)—        
Additions as a percentage of total % 29.4 43.0 19.0
PPE as a percentage of total assets % 4.5 92.8 56.7
Taxpayers' funds at year end $000 13,764 13,764 12,327
         
Forecast net cash flows        
Cash disbursed to producing outputs $000 (17,093) (19,610) (15,008)
Net increase/(decrease) in cash held $000 (1,721) (6,073) 4,274

Audit Report

TO THE READERS OF PARLIAMENTARY COUNSEL OFFICE'S FINANCIAL STATEMENTS AND PERFORMANCE INFORMATION
For the year ended 30 June 2008

The Auditor-General is the auditor of Parliamentary Counsel Office (the Office). The Auditor-General has appointed me, John O’Connell, using the staff and resources of Audit New Zealand, to carry out the audit on his behalf. The audit covers the financial statements and statement of service performance included in the annual report of the Office for the year ended 30 June 2008.

Unqualified opinion

In our opinion:

The audit was completed on 22 September 2008, and is the date at which our opinion is expressed.

The basis of our opinion is explained below. In addition, we outline the responsibilities of the Chief Parliamentary Counsel and the Auditor, and explain our independence.

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 the audit to obtain all the information and explanations we considered necessary in order to obtain reasonable assurance that the financial statements and statement of service performance 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 and statement of service performance. If we had found material misstatements that were not corrected, we would have referred to them in our opinion.

The audit involved performing procedures to test the information presented in the financial statements and statement of service performance. 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 Parliamentary Counsel;
  • confirming year-end balances;
  • determining whether accounting policies are appropriate and consistently applied; and
  • determining whether all financial statement and statement of service performance disclosures are adequate.

We did not examine every transaction, nor do we guarantee complete accuracy of the financial statements and statement of service performance.

We evaluated the overall adequacy of the presentation of information in the financial statements and statement of service performance. We obtained all the information and explanations we required to support our opinion above.

Responsibilities of the Chief Parliamentary Counsel and the Auditor

The Chief Parliamentary Counsel is responsible for preparing the financial statements and statement of service performance in accordance with generally accepted accounting practice in New Zealand. The financial statements must fairly reflect the financial position of the Office as at 30 June 2008 and the results of its operations and cash flows for the year ended on that date. The statement of service performance must fairly reflect, for each class of outputs, the Office’s standards of delivery performance achieved and revenue earned and expenses incurred, as compared with the forecast standards, revenue and expenses adopted at the start of the financial year. The Chief Parliamentary Counsel’s responsibilities arise from sections 45A and 45B of the Public Finance Act 1989.

We are responsible for expressing an independent opinion on the financial statements and statement of service performance and reporting that opinion to you. This responsibility arises from section 15 of the Public Audit Act 2001 and section 45D(2) of the Public Finance Act 1989.

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 carried out an assignment during the reporting period being a review of the tender process for the provision of printing services. This assignment is compatible with those independence requirements. Other than the audit and this assignment, we have no relationship with or interests in the Office.

John O'Connell
Audit New Zealand
On behalf of the Auditor-General
Wellington, New Zealand

Matters relating to the electronic presentation of the audited financial statements

This audit report relates to the financial statements of the Parliamentary Counsel Office for the year ended 30 June 2008 included on the Parliamentary Counsel Office's web site. The Chief Parliamentary Counsel is responsible for the maintenance and integrity of the Parliamentary Counsel Office's web site. We have not been engaged to report on the integrity of the Parliamentary Counsel Office's web site. We accept no responsibility for any changes that may have occurred to the financial statements since they were initially presented on the web site.

The audit report refers only to the financial statements named above. It does not provide an opinion on any other information which may have been hyperlinked to/from these financial statements. If readers of this report are concerned with the inherent risks arising from electronic data communication they should refer to the published hard copy of the audited financial statements and related audit report dated 22 September 2008 to confirm the information included in the audited financial statements presented on this web site.

Legislation in New Zealand governing the preparation and dissemination of financial statements may differ from legislation in other jurisdictions.

APPENDICES

Legislative framework

The PCO is constituted as a separate Office of Parliament by the Statutes Drafting and Compilation Act 1920.

Under the Statutes Drafting and Compilation Act 1920, the PCO is responsible for:

  • drafting Government Bills and Statutory Regulations
  • supervising the printing of Government Bills and Statutory Regulations
  • examining local Bills and private Bills
  • compiling reprints of statutes and Statutory Regulations
  • supervising the printing of those reprints.

The Inland Revenue Department is responsible for drafting certain Bills that will become Acts administered by that department (see Inland Revenue Department (Drafting) Order 1995 (SR 1995/286)).

Under section 4(1) of the Acts and Regulations Publication Act 1989, the PCO is responsible for arranging the printing and publication of:

  • copies of Acts of Parliament
  • copies of Statutory Regulations
  • reprints of Acts of Parliament and reprints of Statutory Regulations
  • reprints of Imperial Acts that have effect as part of the laws of New Zealand.

From time to time, the PCO also drafts certain other instruments such as Orders in Council establishing commissions of inquiry, instruments made under the Royal prerogative, and other official documents.

The PCO is not part of the Public Service under the State Sector Act 1988, and thus is not under the direct control of the State Services Commissioner. However, the PCO is part of the State services within the meaning of the State Sector Act 1988, and is subject to certain provisions of that Act (eg sections 57 to 57C, which relate to the setting and enforcement of minimum standards of integrity and conduct).

Governance arrangements and structure in the PCO

The Chief Parliamentary Counsel and Parliamentary Counsel are appointed under the Statutes Drafting and Compilation Act 1920 by the Governor-General on the recommendation of the Prime Minister. Other staff are employed by the Chief Parliamentary Counsel on contract.

The Minister responsible for the PCO is the Attorney-General. Under the Output Plan agreed each year by the Attorney-General and the Chief Parliamentary Counsel, the Chief Parliamentary Counsel is required to report quarterly to the Attorney-General. The Chief Parliamentary Counsel is responsible to the Attorney-General for the operations and management of the PCO.

The organisational structure of the PCO, revised during the 2007/08 year, is shown under Organisational health and capability.

The PCO has key relationships with a number of other organisations, in particular, the Parliamentary Service, which provides a range of services to the PCO. These include accounting and financial reporting services, payroll and the provision of human resources support, and the parliamentary core computing network. Service level agreements are in place to manage the provision of these services.

The PCO works closely with the Office of the Clerk and has developed protocols with that office. The PCO also works closely with the Legislation Coordinator and with the Secretary of the Cabinet Legislation Committee in the Cabinet Office.

The PCO fulfils its obligation to publish New Zealand legislation through a contract with SecuraCopy for the printing, distribution, and sale of hard-copy legislation and by publishing direct to the New Zealand Legislation website.

The Auditor-General is the auditor of the PCO. The Auditor-General has appointed Audit New Zealand to perform the audit of the PCO on his behalf. Audit New Zealand also undertakes the annual Departmental Internal Control Evaluation (DICE) review on behalf of the Treasury.

Vision statement

View the PCO vision statement

PCO staff as at 30 June 2008

Chief Parliamentary Counsel and Compiler of Statutes ACCESS TO LEGISLATION CORPORATE SERVICES
David Noble Deputy Chief Parliamentary Counsel (Access to Legislation) Acting Corporate Services Manager
  Geoff Lawn3 John Farrell
LAW DRAFTING    
Deputy Chief Parliamentary Counsel (Drafting) Chief Information Officer Communications Adviser
Ian Jamieson Paul de Wijze Gillian McIlraith
     
Parliamentary Counsel Administrator Corporate Services Coordinator
Andrew Borrowdale Janice Kirk David Ashton
Melanie Bromley    
Ross Carter Information Systems (IS) Coordinator Corporate Services Officer
Jacqueline Derby Judy Hill Laraine Johnston
Suzanne Giacometti    
Mark Gobbi IS Business Analyst Messenger
Briar Gordon1 Sally Hardham Assuero Fastelli
Elizabeth Grant    
Joanne Guzman2 IS Developer PA to the CPC and Corporate Services Manager
Renato Guzman Devon Heaphy Kay Purdey
Hugo Hoffmann    
Gill James IS Helpdesk Analyst Receptionist
Fiona Leonard Seamus Jolly Judith Keegan
Julie Melville    
Bill Moore IS Support Officer Librarian
Scott Murray Dwain Collins Kate Anthony
Cassie Nicholson2    
Margaret Nixon IS Test Analyst Library Assistant
Leeanne O'Brien Amita Mylavarpu Pia Baarspul
Amy Orr    
Cathy Pooke Legislation Systems Manager Organisational Development and HR Adviser
Frank Riley Grant Johnson Lorna Ward
Leigh Tauakipulu    
Richard Wallace Prepublication Unit (PPU) Coordinator Records Adviser
Peter Williams Michelle Groves Graeme Thompson
Shane Williams    
Catherine Yates PPU Deputy Coordinator Records Administrator
  Graham Minnoch Shannon Tomlinson
Assistant Parliamentary Counsel    
Jillian Penn PPU Officers Secretarial Services Coordinator
  Katherine Barcham Helen Churchill
Special Counsel to the Parliamentary Counsel Office Kevin Hilder  
Don Mathieson QC Peter Johnston Law Drafters' Secretaries
  Harry Masters Linda Dunn
Editorial Services Coordinator Derek McGuinness Suzanne Gledhill
Mark Prentice Doreen Peers Denise Paterson
    Rhea Repia
Legal Publications Officers Reprints Unit Coordinator Jaana Salo
Sharon Boland Juliet Price Ana Visala
Lauren Chambers   Julie Ward
Andrew Delahunty Reprints Officers  
Marion Edmond David Dew  
Reuben Holcroft Cathy Ellis  
Claire Mabey Marcin Frankowski  
Kate Robinson Megan Sang  
Alan Witham Bernardine Teoh  

1 On 12-month secondment to the Office of Parliamentary Counsel (OPC) in London, England. Nicola Holt from the OPC is at the PCO for the same period.
2 On parental leave.
3 On two-year secondment to the Law Commission.

View photo of the staff of the Parliamentary Counsel Office (63Kb JPG)

Footnotes

1Preparing the Annual Report: Guidance and Requirements for Departments 23 June 2008 www.treasury.govt.nz/publications/guidance/accountability/annualreports.
2Statement of Intent Parliamentary Counsel Office for the period 1 July 2007 to 30 June 2010.
3www.pco.parliament.govt.nz/corporatefile/soi/soi2007-2010.shtml#outcomes.
4 This is further explained in the Statement of Intent Parliamentary Counsel Office for the period 1 July 2007 to 30 June 2010.
5 This is in accordance with the intention expressed in the Report of the Parliamentary Counsel Office for the year ended 30 June 2007.
6 "Officialisation" refers to the steps necessary to make each principal enactment in the database of legislation on the New Zealand Legislation website an accurate and authoritative version of compiled legislation.
7 See the Report of the Parliamentary Counsel Office for the year ended 30 June 2007 for more on the review.
8www.knowledge-basket.co.nz.
9 The structure of the New Zealand Legislation website, and the formats it offers, differ from the interim site, making direct comparison difficult. The new site offers PDF versions of documents, which can be downloaded for use offline. The higher bandwidth usage but lower unique visitor numbers may reflect this as PDF files tend to be larger in size.
10 Due to its size and character as a consolidating and amending statute, this Act is currently available on the New Zealand Legislation website in PDF format only. Officialisation of the Act is expected to be completed within the 2008/09 year.
11 Total numbers of enactments reprinted by year ended 30 June: 2004: 11 Acts, 3 Statutory Regulations; 2005: 21 Acts, 35 Statutory Regulations; 2006: 39 Acts, 10 Statutory Regulations; 2007: 35 Acts, 9 Statutory Regulations; 2008: 14 Acts, 2 Statutory Regulations.
12www.legislation.nsw.gov.au.
13 A paper entitled "Public Access to Legislation: Enhancing the Access Experience" was presented by Geoff Lawn (Deputy Chief Parliamentary Counsel (Access) and PAL Project Director) to the Australia–New Zealand Scrutiny of Legislation Conference, held at Parliament Buildings, Wellington, from 31 July to 2 August 2007 (www.pco.parliament.govt.nz/pal/enhancingaccess.shtml).
14 Performance Information for Appropriations: Vote Parliamentary Counsel (www.treasury.govt.nz/budget/2008/ise/v7/ise08-v7-pia-parcou.pdf); Statement of Intent Parliamentary Counsel Office for the period 1 July 2008 to 30 June 2011.
15Statement of Intent Parliamentary Counsel Office for the period 1 July 2008 to 30 June 2011.
16www.lawcom.govt.nz/ProjectMiscellaneousPaper.aspx?ProjectID=132.
17 Noel Lee accepted the position of Corporate Services Manager in June 2008.
18 See the Report of the Parliamentary Counsel Office for the year ended 30 June 2007.

© Crown copyright 1997–2014