Annual Report 2003/2004

1 Overview

2 Statement of Service Performance for the Year Ended 30 June 2004

3 Financial Statements for the Ministry for the Environment

4 Financial Statements and Schedules: Non-Departmental

5 Triple Bottom Line Progress

6 Management of the Ministry

7 Contact Information

Vote: Environment
Output Class: Environmental Policy Advice

Historically this output class covered the provision of policy advice. However, given our new strategic direction and the need to perform effectively, we cannot continue to operate as a 'pure' policy agency. As a result, this (main) output class includes more work than just policy advice.The Ministry is taking a stronger role in environmental governance and provides investigation, analysis, review and provision of advice on a range of environmental issues. This output class includes leading whole of government initiatives, co-ordinating the collaboration of central and local government in the delivery of environmental programmes and administration of legislation as well as advice to the Government and other stakeholders.

Performance measures

Outputs in this class were provided within the appropriated sum and within the timeframes as specified in the Estimates (unless otherwise stated). Performance measures were specified for each output as appropriate.

Drafting instructions were completed subject to timeframes set in the Government's Legislative Programme.

All outputs were delivered to the Ministers' specifications. Orders in Council and regulations were intra vires and in accordance with principal statutes.

Resources employed

Actual 30/06/2003 $000		Actual 30/06/2004 $000	Main estimates 30/06/2004 $000	Supplementary estimates 30/06/2004 $000
	Revenue:
28,107	Crown	24,242	23,012	24,242
0	Departmental	200	20	200
7	Other	0	5	5
28,114	Total revenue	24,442	23,037	24,447
25,977	Total expenses	24,343	23,037	24,447
2,137	Net surplus	99	0	0

Review of output achievements

Output 1.1: Resource Management Act (1991) Administration

Take accountability for effective operation under the Resource Management Act (1991)

Achieved and ongoing. The dissemination of RMA information to practitioners through the Quality Planning Website was substantially increased by the addition of 21 new guidance notes and three question and answer documents. In addition, another eight existing guidance notes were updated to ensure they provide accurate and relevant information. Over 2300 practitioners receive a monthly email newsletter advising them of any new guidance material and matters that may be of interest to them. Content has been developed for the Accreditation of Decision Makers Scheme, which will begin in early 2005, following the appointment of a provider. Material has been developed aimed at enhancing the effectiveness of Maori participation in RMA processes, which will be rolled out in 2005. The council one-on-one assistance scheme was trialled with two councils, with another trial due to be carried out in late 2004.

Administer the Environmental Legal Assistance Fund, Education and Advisory Fund and Environment Centre Grants

Achieved and ongoing. We administered 134 existing deeds for environmental legal assistance, RMA education and advisory, and environment centres. Funding rounds were held in March 2004 for environment centre and RMA education and advisory funding. Of the 15 applications received for RMA education and advisory, 10 were approved funding totalling the maximum available of $250,000. Of the 19 applications for environment centre funding, 10 were approved totalling $300,000.

The Environmental Legal Assistance Fund allocates funding each month to enable communities to take action on environmental issues. Of 89 applications, the Ministry funded 54 in the 2003/04 financial year.

Assist the Department of Courts to reduce delays in the Environment Court

The backlog of Environment Court cases awaiting a hearing had been steadily growing since the early 1990s, to a high point of more than 3000 in June 2001. In 2003/04 the Ministry initiated a number of improvements in the Environment Court that are now showing positive results. These improvements have been supported by an increase in government funding of $1.2 million per year for four years.By June 2004 the number of cases awaiting a hearing had dropped to 1460 with delays having more than halved since 2001 and caseloads now managed more effectively.

Improvements to the Environment Court include:

• an increase in the number of Environment Court Judges and Commissioners
• an increase in the level of administrative support - each of the Environment Court Judges is now assisted by a case manager and a legally qualified hearing manager
• there are now three registries available to lodge and process documents (Auckland, Wellington and Christchurch)
• the Environment Court now operates on a new case management system. This features three tracks: standard, complex (for dealing with priority or urgent matters) and 'parties hold' (if parties request that their case be put on hold, subject to the Court's agreement)
• the ability of the Commissioners to sit alone to hear and decide cases has been increased
• environment Commissioners have completed advanced mediation training to help resolve issues in dispute without the need for a hearing
• the use of digital audio technology assists with transcribing oral evidence and Judges' note taking.

On 10 May 2004, Cabinet agreed for the Associate Minister for the Environment to lead a review of the RMA that would develop a package of improvements to the Act and the way it operates in practice. The focus is on improving the quality of decisions and processes (more specifically increasing certainty and reducing delays, costs and abuse of processes), while not compromising good environmental outcomes or sacrificing public participation. The Ministry commenced leading the cross-government policy advice, establishing a core officials group, and helping to establish and support an ad hoc Ministers group, Chief Executives' group and Ministerial Reference group.The Associate Minister for the Environment is due to report to Cabinet in August 2004 on the outcome of the review.

Output 1.2: Waste and Hazards Management

Work with local government and stakeholders to develop and introduce national environmental standards

Achieved and ongoing. During the year the first set of national environmental standards were developed and approved (in consultation with local government). The national environmental standards automatically apply to local councils and are implemented through resource consent decisions and through local planning documents. These standards were largely focused on air quality and are expected to improve air quality and the health of people in New Zealand.

The standards cover:

• dioxins and toxics - banning certain activities that emit hazardous pollutants to air such as the open burning of tyres
• ambient (outdoor) air quality - to keep the air outdoors clean and safe. The standards deal with the particles smaller than ten micron (PM10), sulphur dioxide, nitrogen dioxide and ozone pollutants
• the design of new home wood burners in urban areas to minimise harmful emissions to air
• landfills (over one million tones), requiring them to collect and destroy landfill gas - to help reduce greenhouse gases.

The standards provide national certainty and consistency in resource management and the Ministry is continuing to work with central and local government in the development of further national environmental standards.

Make the Hazardous Substances and New Organisms (HSNO) Act (1996) more pragmatic, and in particular simplify the transfer of hazardous substances

Achieved. Key elements of the Cabinet-endorsed Hazardous Substances Strategy have been put in place. The work focused on achieving the transfer of single substance dangerous goods and scheduled toxic substances on 1 April 2004, a date fixed in the previous legislation for the renewal of dangerous goods licences.

For the 1 April transfer, it was essential to pass the Hazardous Substances and New Organisms (Transitional Provisions and Controls) Amendment Act. The Amendment Act was passed on 23 March 2004 enabling the Environmental Risk Management Authority (ERMA) to decide the transfer provisions and put them in place by a Gazette notice. The Gazette notice included the controls for stationary containers. Other controls required for the transfer were provided through regulations for compressed gases, tank wagons, and amendments to Class 1-5 Controls Regulations, Identification Regulations and Emergency Management Regulations. These controls came into force on 26 March 2004.

Long-term plans for compliance and enforcement were prepared. Ministers were briefed on ideas for a control identification tool. Together with ERMA and the Department of Labour, the Ministry let a major contract to collect data on the locations and quantities of hazardous substances across New Zealand, and to identify optimal risk management strategies for achieving compliance.

Implement the Hazardous Substances and New Organisms Low-Risk Genetic Modification Regulations 2003

Achieved. The HSNO Low-Risk Genetic Modification Regulations 2003 were gazetted on 3 July 2003 and came into force on 31 July 2003. The Ministry has responded to questions from the Regulations Review Committee relating to the Regulation. The questions dealt with involved:

• the purpose of the Regulation
• its effect and framework
• consultation
• the inclusion of human cells
• the role of Institutional Biological Safety Committee.

A number of technical drafting errors have been identified and a Legislation Cabinet Committee paper drafted for interdepartmental consultation.

Support legislative changes for new organisms following the Royal Commission on Genetic Modification

Achieved. The New Organisms and Other Matters (NOOM) Bill was introduced to the House in April 2003 as an omnibus bill with amendments to the HSNO Act, the Medicines, Agricultural Compounds and Veterinary Medicines Act, and the Biosecurity Act. It was referred to the Science and Education Select Committee with the intention that the legislative changes would be completed before the end of the 'restricted period' (moratorium) on 29 October 2003.

An additional Cabinet paper on biosecurity clearance for conditional release and compensation for verifiable loss as a result of HSNO new organism enforcement action was provided to the Select Committee. The proposed changes were incorporated into the departmental report and the Select Committee agreed to amend the NOOM Bill.

Additionally, the Ministry also provided advice on supplementary order papers. The Select Committee reported back to the House on the NOOM Bill on 1 September, and the Bill took effect on 30 October 2003.

Output 1.3: Biodiversity (including Fisheries and Marine Management), Biosecurity and Biotechnology

Lead whole of government team to drive Oceans Policy

Achieved. The Ministry ran a whole-of-government secretariat comprising staff seconded from the Ministry of Economic Development, Ministry of Fisheries, Te Puni Kokiri, and the Department of Conservation to develop the Oceans Policy. The Ministry also chaired the senior officials steering group and the Chief Executives' Group. The arrangement worked extremely well, to the point where it could be considered an excellent model for running whole of government projects.

The Oceans Policy Secretariat completed the draft Oceans Policy package which consisted of overarching objectives and principles for oceans management, arrangements for the direction and structures that need to be in place to deliver on these, and a series of tools and measures to make management of our oceans better and fill the gaps in oceans management. The package was delivered to the Ad Hoc Ministerial Group responsible for Oceans Policy.

However, on 17 May 2004 Cabinet made the decision not to consider these proposals until after the Foreshore and Seabed legislation has been passed. Further development of the policy is on hold until this time.

While the draft Oceans Policy package was widely consulted on with key stakeholders, Maori (including a Maori Working Group) and local government (through a local government partnership), the public will not be consulted until after Cabinet has approved the package for consultation. This has now been delayed until after the Foreshore and Seabed legislation is passed.

Provide advice on the content of a government policy framework for foreshore and seabed reform, particularly the RMA elements of the reform, by April 2004

Achieved. The Ministry's contribution to the Department of Prime Minister and Cabinet-led programme of work on foreshore and seabed reform represented a significant focus of work across many teams during 2003/04. It also led to a refocus of a number of other related work programmes such as aquaculture reform, Oceans Policy development, and Treaty settlement work.

The Ministry's input to the foreshore reform involved providing advice on:

• drafting of the Government's consultation documents (released mid-August 2003)
• a wide range of policy issues that formed part of the Government's proposed policy response (issued December 2003) - particularly the relationship between resource consent/planning processes under the RMA and the new customary rights regime proposed through the reform
• legislative drafting in the lead-up to tabling of the draft Bill in May 2004
• the content of a departmental briefing to the Select Committee.

The Ministry for the Environment participated in the Steering Group formed to oversee policy development, as well as in a number of cross-departmental working groups convened to consider specific policy areas such as Maori engagement in local decision-making. The Ministry seconded a staff member to the Department of Prime Minister and Cabinet to assist with ministerial advice on RMA-related parts of the policy response and Bill. We also led cross-departmental meetings on issues specific to RMA-related aspects of the Bill.

Provide advice on legislative drafting of the Foreshore and Seabed Bill by 30 May 2004

Achieved. The Ministry participated in cross-departmental work to prepare drafting instructions and comments on early drafts of the Bill.

The Ministry provided direct assistance with processing of early written submissions on the Bill. The Ministry was also involved with early work to assist the Select Committee in its consideration of the Bill (with the Committee due to report back to the House in early November 2004).

Maintain aquaculture moratorium

Achieved. The Resource Management (Aquaculture Moratorium Extension) Amendment Act (2004) was developed and considered by Parliament to extend the moratorium on new aquaculture applications. The Amendment Act also addressed a problem with consents lapsing while applications for marine farming permits under the Fisheries Act (1983) were considered. This was enacted in March 2004.

Contribute to the whole-of-government project to develop the aquaculture reform policy and implement it as legislation

Ongoing. Over the 2003/04 year, the Ministry for the Environment worked with the Ministry of Fisheries, Department of Conservation, Te Puni Kokiri and Treasury to complete the policy behind the core elements of the aquaculture reform. The work on the aquaculture reform was organised into three workstreams:

1. The general reform, which shifts aquaculture management from a dual system under the Fisheries and the Resource Management Act (RMA) to the RMA solely. The Ministry played a significant role in the policy development in this area. From late June 2004, the Ministry began leading the work on the progression of the Aquaculture Reform Bill through the House.
2. The allocation of aquaculture space to Maori. This work stream is led by the Ministry of Fisheries.
3. An implementation programme to help councils deliver the plan changes that will be necessary to give effect to the new policies.

The Ministry's focus was on the general reform, focusing on the development of amendments to the RMA necessary to transfer the existing regime into the RMA planning and consenting system.

In addition to normal policy development processes, this included co-convening a regional government working group to assess the effectiveness of the reforms and report back to the Minister of Fisheries (chair of the Ad Hoc Ministerial group) on proposed changes. We also met regularly with industry representatives to ensure their concerns were properly taken into account, and policy adjustments were made as a result of these sessions. By the end of the financial year, most of the key policy decisions had been taken by Ministers or Cabinet, and only a few outstanding issues remained.

Develop a National Policy Statement on Biodiversity

Ongoing. A draft of the National Policy Statement was prepared and circulated to Ministers and departments at the end of 2003. The Minister for the Environment decided not to notify the document at that stage and sought further options for moving forward. The Ministry, together with the Department of Conservation, completed a detailed assessment of the gap between what currently exists and what might be needed for the future, and we reported our findings to the Ministers. This work has enabled exploration of an alternative approach for the National Policy Statement based on protecting remaining vegetation in land environments that are significantly diminished.

Output 1.4: Promoting Environmental Awareness and Action

Encourage awareness and action on environmental issues

Achieved. An updated set of the Resource Management Act (RMA) public information brochures was published on the Ministry's website and were made available to councils to be able to download and adapt for their own purposes. These brochures cover the range of different ways that the public can be involved in RMA processes, and provide tips and guidance on how to participate effectively.

Further develop the public information on Ministry-related websites

Achieved. The Ministry had previously launched a new website in 2002/03, and in 2003/04 revamped the existing websites for Climate Change and Oceans Policy to comply with the New Zealand Government web guidelines. We also developed new websites for the Bioethics Council and the 4 million careful owners campaign led by the Ministry.

Administer, further develop and promote the Green Ribbon Environmental Awards

Achieved. Twelve awards were presented to individuals and groups in eight categories. The 2003/04 awards (held in June 2004) featured a marked increase in the number of nominees in the Caring for the urban environment category, up nine to 27.

Assist sectoral groups and regional networks involved in environmental education to come together to develop cooperative programmes and partnerships

Achieved. The inaugural National Youth Environment Forum was held in September 2003. The Forum, developed in partnership with regional councils, brought together 49 young people from throughout the country providing an opportunity for young people to have a voice on environmental issues and to learn first hand the complexities of environmental management. The Sir Peter Blake Trust will partner with the Ministry in hosting the second Youth Environment Forum in Wellington in December 2004.

Four issues of the environz newsletter were published, with each edition distributed to over 7000 stakeholders, providing information on the development of environmental policy and Ministry activities.

Undertake a national roadshow, in partnership with regional councils

Achieved. In November 2003 the Ministry, in partnership with regional councils, undertook a national roadshow covering 16 regions from Whangarei to Invercargill. We met with the community, iwi, local government and industry to hear their views about our work and explain how we are going on major work being led by the Ministry. Another roadshow is planned for November 2004.

Output 1.5: Sustainable Development, Transport, Energy and Trade

Develop initiatives to enhance water quality, allocation and protection of water bodies of national significance, under the Sustainable Development Programme of Action (jointly with the Ministry of Agriculture and Forestry)

Achieved and ongoing. The programme began in July 2003 and is due to be completed by October 2005.

A collaborative approach has been adopted for the development of policy. During the year project teams, steering groups and cross-government working group structures were established, and mechanisms for consultation with all key stakeholders were put in place.

Good progress was made in the research and development of base information, as well as issue and option reports within all three streams of work. The key issues and options identified in the first year will be incorporated into discussion documents for a programme of wider public consultation planned for next year.

Participate in the development of a funding package for Auckland transport

Achieved. The funding package was announced in December 2003. This announcement resulted in Ministry involvement in the preparation and drafting of the Local Government (Auckland) Amendment Bill. The Bill was passed into legislation on 30 June 2004.

Partner local government in Auckland on implementation of the Sustainable Cities initiative

Achieved. We participated in the creation of the Joint Action Plan for Auckland. This plan sets out the detailed programme of work to be undertaken in Auckland to progress the Sustainable Cities initiative. The Joint Action Plan identified six work streams, each with a number of projects for implementation. These six work streams are: Transport; Urban Form, Design and Development; Sustainable Communities; Auckland Regional Economic Development Strategy; Child and Youth; and Migrant Settlement.

Prepare material for the New Zealand delegation to the United Nations Commission for Sustainable Development meeting in New York

Achieved. The Ministry prepared background material for the delegation on New Zealand's work relating to human settlements, including speech notes for the Minister, and reported progress against the Johannesburg Plan of Implementation.

Participate in the 12th Meeting of the United Nations Commission on Sustainable Development

Achieved. Ministry for the Environment officials joined the New Zealand delegation participating in the 12th meeting of the United Nations Commission on Sustainable Development in April 2004. The meeting presented opportunities to showcase New Zealand's achievements in terms of giving effect to the Johannesburg Plan of Implementation agreed to at the World Summit on Sustainable Development and to learn from the experiences of other countries. This year was the first meeting where the Commission used the 'thematic cluster' model agreed to in 2003 intended to focus action on a specific set of related issues drawn from the objectives of the Johannesburg Plan of Implementation. The issues will now be addressed over two-year cycles that have a review phase and a policy phase. The meeting was important for the Ministry as the themes that were being reviewed (water, sanitation and human settlements) are closely aligned with work currently being undertaken in the Water Programme of Action and the sustainable cities and urban design work streams of the Sustainable Development Programme of Action. Following on from this review aimed at identifying constraints and obstacles and possible approaches for implementation, next year's policy phase will focus on reaching consensus on practical action.

Establish trade and environment provisions in New Zealand trade agreements

Achieved. The Ministry has been working to ensure that the Government's commitments to sustainable development are reflected in all of its trade negotiations and that trade and environment policies are mutually supportive. We have been negotiating environment provisions in trade agreements with Thailand on a Closer Economic Partnership and also with Singapore and Chile on the Pacific 3 Agreement that is hoped to conclude in the 2004/05 financial year. We were also involved in negotiations around the Trade and Economic Cooperation Framework with China and have made sure that environmental concerns are addressed in the feasibility study for a potential Free Trade Agreement with them.

Promote New Zealand interests in Sustainable Development in multilateral forums

Achieved. The Ministry has actively contributed to the sustainable development debate in other multilateral agencies, such as the Organisation for Economic Cooperation and Development (OECD). We have been engaged in the work of the OECD Environment Committee and joined with other members to ensure the OECD maintained a sustainable development work programme and a co-ordinating mechanism to manage this work. Environment issues have been on the World Trade Organisation Doha Development Agenda, but work in this area slowed after the talks collapsed at the Ministerial Conference in Cancun in September 2003.

Contribute to a submission to the World Trade Organisation on defacto European Union Genetic Modification (GM) moratorium

Achieved. The Ministry provided input into the Ministry of Foreign Affairs and Trade Cabinet paper seeking authority to submit to the World Trade Organisation Secretariat on the dispute between the United States, Canada and Argentina versus the European Union on the latter's defacto moratorium on GM products. The Ministry contributed to the preparation of New Zealand's written submission and provided commentary on the submissions provided to the Secretariat by the principal parties.

Support agencies in Genetic Modification related investigations

Achieved. The Ministry provided support for key agencies and the Minister's office during several investigations into incidents involving the detection of unapproved genetically modified organisms. This included working with the Ministry of Agriculture and Forestry (MAF) and the Environmental Risk Management Authority during the Sunrise corn incident, the Yarrow/Subway bread dough incident, and MAF's suspension of accreditation of the United States GM testing laboratory Biogenetics Services Limited.

The Ministry provided input to the Government's response to the Waitangi Tribunal Claim WAI 1003, the Royal Commission on Genetic Modification Claim before the Waitangi Tribunal. Ministry staff attended the hearing and supported Crown Law at an urgent hearing on the ending of the restricted period.

The Ministry also drafted a Hazardous Substances and New Organisms (HSNO) Ministerial Call-in Protocol with criteria for advising the Minister on when to call-in HSNO applications.

Following completion of the Biosecurity Research Strategy (led by the Ministry of Research Science and Technology), the Ministry provided a response on the Biotechnology Taskforce Report.

Develop a draft Urban Affairs Statement of Strategic Priorities

Ongoing. A draft of the Urban Affairs Statement of Strategic Priorities is due by December 2004. This is being prepared in conjunction with local government representatives and other government departments.

Draft the New Zealand Urban Design Protocol

Ongoing. A draft of the New Zealand Urban Design Protocol is being prepared and will be completed in July 2004, and will be submitted for Cabinet approval and released to the public for consultation in August 2004.