V vote Communications - A Guide to Stimulus Program

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1 VOTE Communications B.5 Vol.I 189

2 Communications Overview Appropriations sought for Vote Communications in 2000/2001 total $ million. This amount is to be applied as follows: $ million (32.2% of the Vote) purchasing services from the Ministry of Economic Development; including: $3.044 million on policy advice on the communications sector, including management of the radio spectrum. $ million on operational management of the radio spectrum. This activity is third-party funded. Appropriations for non-departmental outputs total $ million (65.9% of the Vote). These relate to the Broadcasting Standards Authority and Te Reo Whakapuaki Irirangi. Details are given under Part C. Appropriations for non-departmental other expenses total $0.930 million (1.9% of the Vote) for the Crown s membership of international telecommunications organisations. The Ministry expects to collect $1.200 million of Crown revenue in 2000/2001, most of which is revenue received from Te Reo Whakapuaki Irirangi (Te Mangai Paho) for an amount equivalent to its administration costs. Details of how the appropriations are to be applied appear in Parts B1, C, D, and E of this Vote. Details of Crown revenue appear in Part F. 190 B.5 Vol.I

3 Terms and Definitions Used APT BSA ITU TRWI Asia-Pacific Telecommunity Broadcasting Standards Authority International Telecommunications Union Te Reo Whakapuaki Irirangi (Te Mangai Paho) Footnotes Note 1 Note 2 Not applicable as Crown revenue is not appropriated. Appropriations are stated GST inclusive (where applicable). B.5 Vol.I 191

4 Communications VOTE MINISTER: Minister of Communications ADMINISTERING DEPARTMENT: Ministry of Economic Development The Minister for Economic Development is the Responsible Minister for the Ministry of Economic Development Part A - Statement of Objectives and Trends Part A1 - Objectives for Vote Communications Related Government Outcomes The services to be purchased under Vote Communications will contribute to the Government s Key Goals, primarily in the areas of: Growing an Inclusive, Innovative Economy for the Benefit of All, by providing policy advice on the regulation of the telecommunications, broadcasting and postal sectors, and managing the radio spectrum efficiently and effectively Strengthen National Identity and uphold the Principles of the Treaty of Waitangi, by promoting Maori language and culture through a range of Maori broadcasting initiatives. Output Classes Outputs purchased from the Ministry of Economic Development (MED) will contribute to the Government s strategic priorities in varying degrees. Specific key priorities and action steps are incorporated in the Purchase and Performance Agreement between the Minister and the Chief Executive and will subsequently be reflected in staff performance agreements. The appropriations are intended to fund activities, which fall into the following broad areas: Policy advice in respect of telecommunications, postal services, broadcasting and the management of the radio spectrum Operational management of the radio spectrum. 192 B.5 Vol.I

5 Part A2 - Trends in Vote Communications Classes of Outputs to be Supplied Up until 1998/99 output costs remained relatively constant. Since then a number of changes have occurred in Vote Communications impacting on its appropriations. Non-Departmental Output for Maori Broadcasting has been increased in 2000/01. This increase replaces funding previously provided to Te Mangai Paho through the Public Broadcasting Fee, collected by NZ On Air and transferred to Te Mangai Paho under a ministerial direction pursuant to section 53L of the Broadcasting Act The Public Broadcasting Fee was abolished with effect from 1 July Offsetting this change is one off funding transferred from 1998/99 to 1999/2000 reflecting delays in the timing of expenses incurred in the establishment of a Maori television channel. Furthermore, during 1999/2000 the Administration of Public Broadcasting Funding, Public Broadcasting Funding and associated policy advice functions have moved from Vote Communications to Vote Culture and Heritage, following the transfer of responsibilities of the Broadcasting Commission (NZ on Air) from the Ministry of Economic Development to the Ministry of Culture and Heritage. The full impact of these changes is reflected in reduced 2000/01 appropriations. Other changes to departmental activities have also had an impact on the appropriation trends for Vote Communications. These mainly reflect the following: the successful completion of Year 2000 readiness initiatives during the 1999/2000 year means that no appropriation is sought in 2000/01 for these outputs ($4.240 million in 1999/2000); the transfer of IT policy ($0.628 million) to Vote Commerce from 2000/2001 reflecting more appropriately the wider role that IT plays in the economy additional funding of $0.644 million for 1999/2000 and $0.191 million for 2000/2001 for the Ministerial Inquiry into Telecommunications. Crown Revenue and Receipts The fluctuations in Crown revenue over the period are generally due to the number and nature of radio spectrum auctions held and the extent to which licence holders seek replacement licences. Strategic Issues In 1999/2000 the Government established the Ministerial Inquiry into Telecommunications to examine whether the current regulatory environment is best suited to achieving its objective in this sector. A major focus for the Ministry of Economic Development in 2000/2001 will be the implementation of Government decisions on the recommendations of the Inquiry, including detailed legislation and regulation. B.5 Vol.I 193

6 Trends in Vote Communications - Summary of Appropriations and Crown Revenue 1995/ / / / / /01 Appropriations to be Used Types of Appropriation Actual Actual Actual Actual Budget Estimated Actual By the Department Administering the Vote Annual Other For Non-Departmental Transactions Annual Other Total Operating Flows Classes of Outputs to be Supplied 23,977 23,567 23,290 34,779 58,528 42,653 15,967-32,675-48,642 Benefits and Other Unrequited Expenses N/A N/A Borrowing Expenses N/A N/A Other Expenses Capital Flows Capital Contributions Purchase or Development of Capital Assets N/A N/A Repayment of Debt N/A N/A Total Appropriations 24,879 24,374 24,120 35,668 59,458 43,456 15,967-33,605-49,572 Total Crown Revenue and Receipts (see note 1) 23,022 4,886 7,116 5,099 8,374 3,622 N/A N/A N/A N/A 1, B.5 Vol. I

7 Part B - Statement of Appropriations Part B1 - Details of 2000/01 Appropriations (see note 2) 1999/ /01 Vote Estimated Actual Vote Appropriations Annual Other Annual Other Annual Other Description of 2000/01 Appropriations Departmental Output Classes (Mode B Gross) D1 Policy Advice - Communications 4,037-3,683-3,044 - Policy advice on telecommunications, postal services, broadcasting and on the management of the radio frequency spectrum, including creating and disposing of licences and management rights. D2 Management and Enforcement of the Radiocommunications Act ,051-12,956-12,923 - Management of the radio frequency spectrum by granting radio apparatus licences, compliance activities, maintaining a register of licences issued, and creating spectrum licences for Crown-owned management rights. D3 Year 2000 Readiness 4,240-3, No appropriation is sought in 2000/01. Total Appropriations for Departmental Output Classes (Mode B Gross) 21,328-20,564-15,967 - Refer to Part C1 for a full description. Non-Departmental Output Classes O1 Maintenance of Standards in Broadcasting Exercise of the statutory functions of the BSA. O2 Public Broadcasting Funding 6,961-6, No appropriation is sought in 2000/01. O3 Administration of Public Broadcasting Funding No appropriation is sought in 2000/01. O4 Maori Broadcasting 27,918-12,807-30,825 - Funding to be disbursed by TRWI for the promotion of Maori language and Maori culture through broadcasting. B.5 Vol. I 195

8 Part B1 - Details of 2000/01 Appropriations (continued) 1999/ /01 Vote Estimated Actual Vote Appropriations Annual Other Annual Other Annual Other Description of 2000/01 Appropriations Non-Departmental Output Classes cont d O5 Administration of Maori Broadcasting 1,300-1,300-1,300 - Administration costs for TRWI. Total Appropriations for Non- Departmental Output Classes 37,200-22,089-32,675 - Refer to Part C2 for a full description. Other Expenses to be Incurred by the Crown Contributions to International Telecommunications Organisations The Crown's annual membership of the Asia - Pacific Telecommunity (APT) and subscription to the International Telecommunications Union (ITU). Total Appropriations for Other Expenses to be Incurred by the Crown Total Appropriations 59,458-43,456-49, B.5 Vol. I

9 Part C - Explanation of Appropriations for Output Classes Part C1 - Departmental Output Classes For more detailed analysis of Departmental Output Classes, including financial and non-financial performance measures, please refer to the Ministry of Economic Development's 2000/2001 Departmental Forecast Report (DFR). Output Class D1 - Policy Advice - Communications The Minister of Communications will purchase policy advice in respect of telecommunications, postal services, broadcasting and the management of the radio spectrum. Outputs in this class are: Policy advice on the regulation, operation, development and effectiveness of these sectors Representation of New Zealand s international interests in these sectors Advice on the operations of the Broadcasting Standards Authority (BSA), and Te Reo Whakapuaki Irirangi (TRWI) (known as Te Mangai Paho) Advice on the exercise of ministerial statutory powers Policy advice on the management of radio spectrum Monitoring and enforcement of compliance with telecommunications, broadcasting and postal services legislation, and the establishment of tradable radio spectrum rights. A special focus for 2000/2001 is to implement Government decisions on the recommendations of the Ministerial Inquiry into Telecommunications. Output Class D2 - Management and Enforcement of the Radiocommunications Act 1989 This output class provides radio frequency spectrum management services. Outputs in this output class include: Licensing and compliance management of the radio frequency spectrum Radio frequency allocation Provision of new technologies and services Registration of radio spectrum rights. B.5 Vol.I 197

10 Part C2 - Non-Departmental Output Classes Output Class O1 - Maintenance of Standards in Broadcasting Description The Minister of Communications will purchase from the BSA the quasi-judicial determination of complaints on broadcasting standards, and support for broadcasters in discharging their responsibilities in relation to programme standards. The BSA is responsible for encouraging the establishment and maintenance, by broadcasters, of acceptable standards of broadcasting on television and radio within the context of current social values and research. The BSA: receives and determines complaints where the public is dissatisfied with the broadcaster s response imposes sanctions on broadcasters where appropriate issues advisory opinions on standards and ethical conduct ensures codes of practice are developed and observed conducts and publishes research on standards matters. Quantity, quality, timeliness and cost Performance Measures Quantity Formal complaints received. Research and code reviews. Quality Compliance with statutory requirements (Broadcasting Act 1989, Parts II and III) and the Authority s Statement of Intent. Consultation with broadcasters and other interested parties in accordance with statutory requirements. Timeliness Decisions on complaints issued within 40 working days after full documentation received unless delayed by court proceedings. 2000/01 Performance Standards (estimate - the actual number will be demand driven). At least 1 piece of original commissioned research and 1 code review. 100% compliance. 100% compliance. 90% Cost 2000/01 Total output class to be provided within (GST inclusive) $550, /2000 Total output class to be provided within (GST inclusive) $550, B.5 Vol.I

11 Provider Broadcasting Standards Authority. Output Class O4 - M ori Broadcasting Description The Minister of Communications will purchase from TRWI broadcasting outputs in accordance with TRWI s statutory functions and the Government s Maori broadcasting policy. Quantity, quality and cost Performance Measures Quantity Under section 53B of the Broadcasting Act 1989, TRWI is required to promote Maori language and Maori culture by making funds available for broadcasting and the production of programmes to be broadcast. In particular it will purchase: programmes to be broadcast on television and on iwi radio; and a range of programmes which have a minimum of 70% Maori language, to be broadcast on television networks. Activities will be carried out in accordance with the provisions of the Broadcasting Act 1989, provisions of the Memorandum of Understanding between the Minister of Communications and TRWI and TRWI s annual Statement of Intent. Quality Activities will meet the standards defined in the Memorandum of Understanding between the Minister of Communications and TRWI, and in TRWI s annual Statement of Intent. Cost 2000/01 Performance Standards Information about the nature and level of intended purchases is specified in the Statement of Intent tabled in Parliament and made available to all interested parties at the beginning of the financial year. 100% compliance. 100% compliance. Quarterly reports will be provided to the Minister of Communications on TRWI s Statement of Intent output performance. 2000/01 Total output class to be provided within (GST inclusive) $30,825, /2000 Total output class to be provided within (GST inclusive) $27,918,000 Provider TRWI. B.5 Vol.I 199

12 Output Class O5 - Administration of M ori Broadcasting Description The Minister of Communications will purchase administration services from TRWI to enable TRWI to meet its statutory functions and deliver on the Government s Maori broadcasting policy. Quantity, quality, timeliness and cost Performance Measures Quantity, quality and timeliness Activities will be carried out in accordance with the provisions of the Broadcasting Act 1989, the Memorandum of Understanding between the Minister of Communications and TRWI, any notices in writing issued by the Minister pursuant to section 53M of that Act, and the agency s annual Statement of Intent. This will include: both formal and informal consultation with Maori broadcasters; groups interested in Maori language; Maori audiences, and other government agencies. The purchase of both broadcasting services and programmes designed to promote Maori language and Maori culture, involving the following processes: developing funding policies for the purchase of radio and television programmes making purchasing decisions to meet TRWI s statutory obligations developing and monitoring funding contracts monitoring contract compliance. 2000/01 Performance Standards 100% compliance. Quarterly reports will be provided to the Minister on TRWI s output performance on its Statement of Intent. Cost 2000/01 Total output class to be provided within (GST inclusive) $1,300, /2000 Total output class to be provided within (GST inclusive) $1,300,000 Provider TRWI. 200 B.5 Vol.I

13 Part D Explanation of Appropriations for Other Operating Flows Part D1 - Benefits and Other Unrequited Expenses There is no appropriation for Benefits and Other Unrequited Expenses. Part D2 - Borrowing Expenses There is no appropriation for Borrowing Expenses. Part D3 - Other Expenses Information on this appropriation is provided in Part B1. B.5 Vol.I 201

14 Part E - Explanation of Appropriations for Capital Flows Part E1 - Capital Contributions There is no appropriation for Capital Contributions. Net Worth of Entities Owned Statement of Estimated and Forecast Net Worth Crown Entities: Balance Date Estimated Net Worth 1999 $ million Forecast Net Worth 2000 $ million BSA 30 June TRWI (Te Mangai Paho) 30 June Part E2 - Purchase or Development of Capital Assets by the Crown There is no appropriation for Purchase or Development of Capital Assets by the Crown. Part E3 - Repayment of Debt There is no appropriation for Repayment of Debt. 202 B.5 Vol.I

15 Part F - Crown Revenue and Receipts Part F1 - Current and Capital Revenue and Receipts 1999/ /01 Budgeted Estimated Actual Budget Description of 2000/01 Crown Revenue Current Revenue Non-Tax Revenue Administration of Maori Broadcasting 1,156 1,156 1,156 In accordance with the Broadcasting Act 1989, the Crown receives revenue from TRWI equivalent to the agreed administration costs of that Crown entity. These administration costs are paid to TRWI via a separate payment from the Crown. Broadcasting Commission 1,674 1,674 - This figure represents the administration costs of the Broadcasting Commission (NZ On Air), which in turn refunds the Crown an equivalent amount. Broadcasting Standards Authority - Complaints Upheld The Broadcasting Act 1989 (as amended by the Broadcasting Amendment Act 1996) empowers the BSA to order costs of up to $5,000 against a broadcaster on each complaint upheld against that broadcaster. These receipts will be treated as Crown revenue, and a corresponding payment made to the BSA by the Crown. Radio Spectrum 5, Revenue is obtained from auctioned spectrum rights and from resource payments under the Radiocommunications Act Total Non-Tax Revenue 8,374 3,622 1,200 Total Current Revenue 8,374 3,622 1,200 Total Crown Revenue and Receipts 8,374 3,622 1,200 B.5 Vol. I 203

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