Housing crisis, Covid misinformation, racism: Problems flagged to new ministers

Author
NZ Herald,
Publish Date
Wed, 16 Dec 2020, 4:19PM
The Government has published all the ministers' briefings on their portfolios. Photo / Supplied
The Government has published all the ministers' briefings on their portfolios. Photo / Supplied

Housing crisis, Covid misinformation, racism: Problems flagged to new ministers

Author
NZ Herald,
Publish Date
Wed, 16 Dec 2020, 4:19PM

Racism in health, extremism in prisons, light rail in Auckland, coronavirus misinformation and an ongoing housing crisis are among the priorities outlined to incoming ministers in hundreds of pages of documents released this morning.

The Briefings to Incoming Ministers (BIM) were released on the Beehive website at 10am.

The briefings are from officials on important and developing issues in their respective portfolios as well as previous work in key policy areas.

Among the documents is advice to the new Covid-19 Response Minister Chris Hipkins, Housing Minister Megan Woods and Finance Minister Grant Robertson.

Even if a minister continues to hold a portfolio from the last term, they still receive a briefing on that area.

Prime Minister Jacinda Ardern will also receive briefings as Minister for National Security and Intelligence, Child Poverty Reduction, and Minister Responsible for Ministerial Services.

Covid-19

Officials advised the Government countering Covid-19 misinformation, rumour and disinformation needs to be a "key focus" of the ongoing public health response to the virus.

The strategy to counteract this is guided by four ideas:

• Rapid intervention to provide an alternative to the mis/disinformed narrative.
• An "inclusive approach" which "recognises audience diversity".
• Using social media to slow/stop the spread of inaccurate information.
• Direct engagement that is "respectful and culturally appropriate, encourages participation, and empowers through dialogue".

"In the event of any future community-based outbreak, trusted and effective communications will again be one of the key elements to successfully stamping it out," the briefing said.

"Continuing to challenge misinformation will also be an ongoing necessity."

Besides commercial fishing vessels, there are a number of private foreign ships - like yachts - wanting to enter New Zealand.

"This can be because the visas of people on vessels in various places in the Pacific are expiring; people cannot easily travel home or go elsewhere; New Zealand is fairly free of Covid-19; these vessels are seeking refuge from the Pacific cyclone season; or people want to come to the America's Cup racing."

The BIM did not advise how these vessels were being treated by officials.

The ministers have been advised that decisions around immigration settings for the border are needed "early in the next term of government".

"These decisions will include consideration of the current settings for critical workers and other exceptions as well as the possibility of allowing larger groups to enter. This work will be led by MBIE."

Covid-19 Response Minister Chris Hipkins. Photo / Mark MitchellCovid-19 Response Minister Chris Hipkins. Photo / Mark Mitchell

They will also need to make decisions in the short term around the on-going supply of MIQ facilities, the booking system and the overall cost. The BIM did not include projections of costs but advised MBIE would provide further advice on this.

They will also receive further advice on the demand for foreign vessels wanting to enter New Zealand - especially ahead of the America's Cup.

"Funding decisions will be required in a range of areas, including for MIQF provision, the aviation sector (including maintenance of air freight capacity), and the operational costs of the border agencies that are substantially funded from third party fees and charges. Border agencies will lead this advice."

Economic warning

They've also been issued the bleak warning that the "long-term economic and psychosocial impacts will likely be experienced for years after economic growth has returned".

And Māori, Pacific peoples and ethnic communities have already been disproportionately laid off in higher numbers than New Zealand Europeans since February.

"Disabled people have experienced longstanding barriers to accessing employment and it will be more difficult to navigate in a tightened labour market competing with other displaced workers."

Older people are less likely to suffer material hardship due to Covid-19 but some were expressing financial difficulties and "more older people are struggling financially".

The Government has been warned that although global output picked up after countries rolled out local support, the global recovery has lost momentum in recent months and a resurgence in the virus could halve the IMF and OECD's projections that global GDP will expand by 5 per cent in 2021.

Many major advanced economies could have lost the equivalent of four or five years of per capita of real income growth by 2021, the BIM warned.

And much of the progress in reducing global poverty since the 1990s will have been reversed.

"Furthermore, 'scarring' effects are expected to persist over the medium term."

But the Indo-Pacific area looks likely to emerge from the crisis in better shape than other regions and has historically demonstrated resilience and most of New Zealand's key markets are in this region, the BIM said.

Treasury is also predicting a 15.4 per cent drop in overall exports for the year ended June 2021.

Oxygen supplies and PPE

Health officials say ramping up our oxygen supplies is a necessary and urgent precaution - in case of a Covid-19 outbreak.

Advice to the incoming minister warns some DHBs have limited oxygen supply and would struggle to manage a significant surge of the virus.

That same briefing also says our spending on infection prevention controls and protective gear is already high - and rising prices could divert funds from other areas of need.

It says global demand and prices for PPE are far beyond normal levels - with $367 million dished out as of September 8, 2020.

Covid-19 vaccines

The Ministry of Health is planning to replace the National Immunisation Register ahead of the rollout of the Covid-19 vaccines.

It presented a business case to Cabinet in October for the new system, dubbed the National Immunisation Solution (NIS) which will replace the one that's been in place since 2005 and is "no longer fit for purpose".

In July the Government announced it had invested $23m to develop the new system in anticipation of the Covid vaccination regime and in response to last year's measles outbreak. That built on an early investment of $15m.

Housing

The BIM to Minister of Housing Megan Woods made it clear from the outset that: "New Zealand continues to face a housing crisis."

"Too many people are in overcrowded homes, homeless and in need of housing support. Too many people struggle to purchase their first home or access affordable rental homes," the BIM said.

The document goes into a bit of detail about how the Government plans to do this, such as the previously announced build-to-rent scheme and by opening up more land for affordable housing.

But what appears to be a new initiative to build more houses has been redacted.

There is also a line that said the Government plans to expand Kāinga Ora – the Crown agency that provides emergency accommodation.

But, again, any details have been redacted.

Housing Minister Megan Woods. Photo / Mark MitchellHousing Minister Megan Woods. Photo / Mark Mitchell

In its briefing, Kāinga Ora warned Housing Minister Megan Woods that many of New Zealand's state homes are "nearing the end of their economic and functional life".

It notes that roughly 40 per cent of the agency's housing stock was built before 1966.

"We need to replace or renew 60 per cent of our portfolio within the next 20 years."
Kāinga Ora owns and manages 66,000 homes.

Meanwhile the agency has an "ambitious programme" to build even more state houses. Over the next four years, Kāinga Ora plans to invest $11.2 billion in its housing stock, resulting in a net increase of approximately 8250 additional state homes.

There are now 6300 homeless or low-income households living in motels around New Zealand.

That is roughly twice as many as the same time last year.

Some of that total - around 1000 people - came as a result of urgently housing rough sleepers during lockdown to prevent the spread of Covid-19.

The Labour Government previously criticised National for using motels for emergency housing, but has said that they are a necessary housing option until more permanent homes are built.

Health

Racism - including systemic and by health professionals - is a barrier of equitable health outcomes in New Zealand and is causing increasing demands on the public system, the Health and Disability Commission told new Health Minister Andrew Little.

Though life expectancy is increasing for Māori males and females, it remains
7.3 and 6.8 years below that of non-Maori males and females, the health BIM report said.

New Zealand's health and disability system faces major cost pressures, snowballed by Covid-19. But compared with some other high-income countries New Zealand spends on healthcare per capita.

Health funding has failed to keep pace with growing demand since the Global Financial Crisis, the Health Minister was told.

The regulatory environment of the Aged Care sector is under Ministry of Health review to develop advice on potential changes, the health and disability commission told Little.

Reducing the number of patients waiting longer than intended for services is a focus of all DHBs but improvement is needed, the Health Minister was told.

The current workforce pipeline is "vulnerable to economic and environmental impacts", as seen during the Covid-19 response, which disrupted the flow of international workers on whom our system heavily depends, the Health Minister was told.

"The health and disability workforce must adapt and respond rapidly to new technology and ways of working," the health and disability commission have advised the Health Minister.

"The health and disability workforce does not currently reflect the diversity of New Zealand's population. However, there are promising signs among Māori and Pacific graduates of clinical training, particularly nursing."

Cancer

A "State of the Nation" cancer report due February 4 will reveal in detail how each DHB could be measured on its cancer care performance in a bid to put an end to postcode lottery, the Cancer Control Agency told the Health Minister.

The Agency also said that meeting future expectations of stakeholders was inevitably going to be challenging, which could lead to some negative feedback about the value and function of the agency.

"We believe we are in a strong position to support any such transformation, in whatever form it takes," the agency told the minister.

Equity, streamlining pathways and prevention were key priorities for the Cancer Control Agency, the Health Minister was told.

Finance

Finance Minister Grant Robertson was warned that the Government will need to "make strategic choices" about what areas to prioritise and what needs to be stopped, or delayed.

Officials have also put a price on the economic toll of Covid-19.

The BIM said economic growth over the next five years is expected to be $140b lower than pre-Covid forecasts.

"We [New Zealand] will be much poorer as a country than we expected to be prior to Covid-19."

The Treasury warns Robertson that it's not sure how the hit to the economy and the rising level of unemployment will interact with rising house prices.

Financial responsibility

The Reserve Bank has outlined to Robertson a new scheme which looks to guard against greedy executives.

It's called the "Executive Accountability regime" and it would require senior executives at financial firms to "act responsibly and prudently".

There are few other details outside this, other than the Reserve Bank would work with MBIE on the scheme and that work was expected to begin midway through next year.

Education

The Ministry of Education says it faces "significant sustainability challenges" due to a planned cut of $56m-$75m in its baseline budget after June next year.

The funding cuts are due to Covid relief funding ending, no more one-off property sales, and "technical adjustments" such as swaps between capital and operating spending.

"In addition, the ministry faces compounding departmental operating cost pressures due to increasing demand for and price of education services, particularly wage inflation," the ministry says.

The Teaching Council is seeking a law change to divert some disciplinary cases from the Teachers Disciplinary Tribunal to more "culturally appropriate" processes.

The council has told Education Minister Chris Hipkins in a post-election briefing that it is investigating whether change is needed "to help address the increased number of cases referred to the Disciplinary Tribunal by the Complaints Assessment Committee, some of which might be dealt with in a more culturally appropriate, fair and efficient manner".

The Government is being urged to provide further financial help for schools and education institutes that have lost overseas students due to Covid-19.

Education NZ, the state agency that promotes international education, says an initial $51m support package announced in July was only a start.

"Education providers are implementing or considering actions, including retrenchments, in response to the pandemic that will also have flow on effects to support staff, including homestay providers," it says in a post-election briefing to Education Minister Chris Hipkins.

"The sector is at risk of losing the capability and infrastructure needed to support the recovery of the sector.

"With the continued closure of the New Zealand border to nearly all international students, additional short-term initiatives to help these providers retain staff and protect their infrastructure in a further targeted assistance package could be considered."

The agency says New Zealand's border closure in response to Covid-19 "has been the longest and most restrictive in the world".

"New Zealand education providers will be at a competitive disadvantage for years to come," it warns.

It says Britain and Ireland have reopened their borders with quarantine restrictions.

"In addition, Canada just reopened its border with students needing to quarantine for 14 days and providers needing to have a Covid-19 readiness plan," it tells Hipkins.

"You could issue a clear message to students offshore that New Zealand not only recognises the difficult position they are in, but that New Zealand is keen to welcome students to return to New Zealand when it is safe to do so."

Transport

The NZ Super fund says its partnership with a Canadian pension fund called NZ Infra remains open to building light rail in Auckland. It said it wants to progress to the next stage of the project, namely incorporating feedback from the assessment process conducted by the Ministry of Transport, refining its design and beginning commercial negotiations on the finance and ownership model.

Auckland light rail was a flagship policy by Jacinda Ardern in the 2017 election when she promised to have the first leg from the CBD to Mt Roskill completed within four years and running to the airport within 10 years.

In 2018 the Government directed the NZ Transport Agency to lead the development of light rail from the Auckland CBD to the airport, expected to cost about $6b.

Shortly afterwards, the Government received an unsolicited bid from NZ Infra, a joint venture between the NZ Super Fund and CDPQ Infra, a Canadian pension fund, to build the scheme as a public-private partnership.

Fromer Transport Minister Phil Twyford announced the Ministry of Transport would assess the rival bids and recommend the best proposal to Cabinet.

The Ministry recommended the Super Fund's plan in 2020, but it was blocked by NZ First, whose leader Winston Peter said it would cost between $10b and $15b and a "decade of chaos".

The project was referred back to the Ministry of Transport for further work, with a decision left to be made by the new Government.

Infrastructure and Finance Minister Grant Robertson told the Herald earlier this month the Government will be taking another look at light rail early in the New Yerar.

"We had some good work done on this and now we have got to do some wokr and understand that but we are absolutely committed to make sure we deliver this further," Robertson said.

Transport Minister Michael Wood. Photo / Mark MitchellTransport Minister Michael Wood. Photo / Mark Mitchell

Transport Minister Michael Wood said the multi-billion dollar investment will shape Auckland for the next 50 to 100 years "so a little bit of time at this point ... is, I think, the right thing to do".

In a breifing paper to Robertson, the Super Fund said it remains open to re-engaging with the on the original premise of NZ Infra delivering the project.

"We believe that the Ministry of Transport's previous endorsement should give Government confidence that the proposal we put forward was of high quality, has already gone through a robust assessment process, and meets Government's objectives for light metro," the Super Fund said

Social Development

Social Development Minister Carmel Sepuloni has been told that Covid-19 support measures like the wage subsidy had helped soften the initial impact on unemployment.

But job losses were expected to rise significantly over the coming quarters because of the economic impact of border restrictions.

Sepuloni's briefing said the number of people receiving Jobseeker Support was expected to reach 279,100 by January 2022. At the end of November, there were 204,100 people on the jobless benefit.

People in the 18-34 year-old age bracket had been severely affected by the economic shock caused by the pandemic, because they had lower skill levels and more casual jobs. There had also been a rise in the number of jobseekers aged over 50.

Sepuloni has also been given a very bleak warning about increasing housing stress in New Zealand.

Officials admitted that the public housing waitlist was now so long (22,000 households) that many of those on the list were "unlikely to receive a public house".

Despite an increase in 2018, the Accommodation Supplement had not kept pace with rents and was not easing housing stress for many people.

"As a result, increasing housing costs are impacting the wider welfare system, particularly through an increase in demand for special needs grants, temporary additional support and other hardship payments."

Social Development Minister Carmel Sepuloni. Photo / Mark TantrumSocial Development Minister Carmel Sepuloni. Photo / Mark Tantrum

Child Poverty

The Government appears likely to fall short of its child poverty reduction targets.

Officials told Child Poverty Reduction Minister Jacinda Ardern that before the Covid-19 outbreak, the Government was broadly on track to meet the three- and 10-year targets.

They have given an initial assessment of the impact of Covid-19 on the three main targets. It was expected that the number of households below the poverty line after housing costs would rise, and the number of households below the poverty line before housing costs would fall slightly.

The number of children in material hardship - considered to be the most important measure - was expected to rise "strongly" because it was particularly sensitive to economic changes.

Officials also said Ardern would have to set new targets for the next three years, but all discussion of those targets was redacted.

Environment and climate change

Ministers have been urged to finally tackle thorny freshwater issues around allocation and iwi rights, and decide how New Zealand will adapt to climate impacts.

Other big priorities in the environment space set out by officials in just-released briefings include a regulatory overhaul, phasing out hard-to-recycle plastics, and protecting more biodiversity hot-spots on land and sea.

Looming large over the portfolios is what the Government will do about the out-dated Resource Management Act (RMA).

While Cabinet is yet to formally decide on its response to this year's Randerson Report, Environment Minister David Parker has made it clear the RMA should be replaced with a Natural and Built Environments Act and a Strategic Planning Act, as recommended.

Parker was also looking at slashing the number of local government resource management plans to one for each region - and giving more national direction on environmental "bottom lines".

A briefing for environment and climate change ministers said early decisions would be needed on the scope and timing of the reforms, and the arrangements involved.

"These reforms provide the opportunity to maintain the commitment to environmental outcomes and improve these outcomes within the next generation."

A separate briefing for Climate Change Minister James Shaw stressed how a "paradigm shift" in global action on climate change in the next decade was essential to avert "catastrophic outcomes".

"We have a compelling national interest in continuing to champion faster and more far-reaching global action to reduce emissions because our wellbeing depends on the effectiveness and speed of others' decarbonisation efforts," officials said.

When it came to how our under-pressure lakes and rivers should be managed, officials urged ministers to agree an approach to much-debated water allocation - and address Māori rights and interests as a priority.

"There are also areas for further development for the farm planning system, and possible amendments to existing regulations ... to aid their implementation."

The Government's reforms, sealed this year, vowed high health standards at swimming spots, cleaner city rivers, farm plans, and new controls around winter grazing, nitrogen pollution and fertiliser use.

In the climate change space, officials said decisions were now needed to set the direction for New Zealand's adaptation and mitigation response - and how to fund it - alongside yet-to-be delivered emissions budgets and reduction plans.

Elsewhere, ministers needed to decide its funding for round two of its "Jobs for Nature" programme – created in this year's Budget to ease the economic strain of Covid-19 - and also firm up the next steps for expanding the waste levy.

Officials said some "critical success factors" would be required across these reforms, such as working with Treaty partners, setting directions early, and collaborating with councils.

"The local government sector is under pressure due to a combination of financial constraints and a large regulatory implementation programme," they said.

"Work across your priorities should be advanced cognisant of this and engaging well with the sector."

A specific briefing to new Conservation Minister Kiri Allan singled out a need to improve legislation around ocean protection, and continuing work to protect biodiversity hot spots on private land.

Justice

The Ministry of Justice pointed to a raft of areas the Government could overhaul, saying there was a need to work with Māori in transforming the criminal justice system.

It said the key criticism of the criminal justice system included that it did not meet the needs of victims, and did not strike the right balance between punishment and rehabilitation.

"Further, Māori are concerned that the Crown is not consistently working with them as Treaty partners to improve the system, raising significant legitimacy issues for Māori."

It said Māori experience disproportionate harm through the criminal justice system, and partnerships with Māori were critical for changes.

It put forward the suggestion of changes to sentencing laws – including expanding the "clean slate" provisions under which someone's criminal conviction is "hidden" after seven years if there are no subsequent further offences.

"Legislative reform [could] include changes to sentencing and bail legislation to promote consistency and transparency, and expanding the clean slate regime. The significant reduction in the level of offending by young people in the past decade means there is potential for a more tailored response to offending in the critical years of 18 to 24.

Addressing offending effectively at this time of emerging adulthood could lead to lasting change.

The briefing noted the Government's decision to review electoral laws.

It also proposed new Justice Minister Kris Faafoi could review the Official Information Act and the Human Rights Act "to improve transparency, trust and legitimacy".

It also raised the prospect of reforms of adoption laws – something former minister Andrew Little had wanted to start work on but was thwarted by NZ First.

Corrections

Corrections has alerted Minister Kelvin Davis to a rise in signs of extremism amongst offenders.

The department has provided a briefing as Davis heads into his second term in the role.

It says there's been an increase in the number of people it manages, who potentially hold extremist views - or display risk factors specific to radicalisation or violent extremism.

It's established a Prisoners of Extreme Risk Directorate and made violent extremism a priority for Corrections Intelligence.

Corrections says it recognises that extra measures are needed to safely manage those who present an ongoing risk of harm - and the potential to influence others to engage in serious violence.

The department says of the nine thousand people in prison, 91 per cent have been diagnosed with substance abuse or a mental health disorder at some point in their lives.

More than half of inmates - or 4730 - identify as Māori.

Thirty-five per cent are affiliated with a gang, and 36 per cent are on remand.

Treaty Negotiations

Officials have advised returning Treaty Negotiations Minister Andrew Little taking "concrete steps" to restore the Crown's relationship with ngā hapū o Ngāpuhi is one of the "key opportunities" in his portfolio.

In August, the Crown agreed that Ngāpuhi regional hapū groupings could develop mandate proposals to negotiate the settlement of all their historical Treaty/Tiriti claims.

Te iwi Ngāpuhi is made up of more than 100 hapū, to which 18.8 per cent of Māori (125,000) in the country affiliate.

However, the Crown has continued to emphasis preference for a single set of financial and commercial redress negotiations. It has also started working on a Ngāpuhi Investment Fund, to acquire and develop assets to be part of any redress.

Officials have also advised Little to ensure "timely completion of settlements with durability".

The Waitangi Tribunal has regularly criticised the Crown for being "too keen to achieve settlement", and not taking sufficient time to resolve overlapping claims between Māori or to ensure widespread and ongoing support for the mandated entity representing an iwi.

Officials reiterated the key purpose of settlements was to "reset relationships" between Māori and the Crown, which had been strained by "many years of grievance and the exclusion of Māori from meaningful engagement on issues of deep significance to them".

Over the last three years, 29 milestones had been achieved, officials said.

These encompassed six enacted pieces of settlement legislation, four introduced settlement bills introduced, five signed deeds, six initialled deeds, six signed agreements in principle and two recognised mandates.

Key upcoming dates were redacted, but officials noted likely binding recommendations from the Waitangi Tribunal over the transfer to Māori of Crown Forest Licenced (CFL) land worth over $1 billion in the next 18 months.

Officials also noted the disproportionate impact of Covid-19 on Māori.

While the elimination and containment strategies for the virus had largely alleviated predicted health and welfare impacts, it was still likely to have a disproportionately greater economic impact on Māori than on Pākehā.

The Māori economy has been estimated to contract by as much as 20 per cent, from an estimated $50b to $40b, due to effects on investments in sectors such as tourism and forestry.

Officials also stated benefits of the country's Treaty settlement process over the past 30 years were "front and centre" in the Covid-19 response, with Māori taking up "early and strong leadership".

"Māori who have settled were able to respond quickly given their existing infrastructure and were able to financially support their communities.

"They also reached out to Māori that have not settled and were able to join up to support each other's efforts."

Current status of Treaty/Tiriti settlements. Photo / SuppliedCurrent status of Treaty/Tiriti settlements. Photo / Supplied

Defence

The NZ Defence Force has used the Briefing to Incoming Minister Peeni Henare to emphasise the threat posed by climate change. Defence had flagged climate change in 2018 as a "major driver of military operations" in the years ahead.

In the BIM, it stated: "Climate change will be one of the greatest security challenges in the coming decades – the risk of concurrent and more extreme weather events is increasing.
The links between climate change and conflict are indirect but demonstrable.

"When the effects of climate change intersect with a complex array of environmental and social issues, these can be significant contributors to both low-level and more violent conflict."

NZDF's briefing to Henaare warned that there would also be greater need for humanitarian assistance and disaster relief, among other operations, "that will stretch resources and may reduce readiness for other requirements".

Critical assessments of other countries through a New Zealand lens were included in the briefing, including negative commentary on China.

The briefing told of China being "deeply integrated into the international rules-based order" with contributions spanning peacekeeping to counterpiracy.

But it also stated that China "has not consistently adopted the governance and values championed by the order's traditional leaders".

"Both domestically and in its mode of international engagement, China's approach to human rights and freedom of information in particular stand in contrast to prevailing norms in New Zealand."

The briefing went on to explain China's desire to "restore claimed historical levels of influence in its periphery" along with "an enhanced global leadership role" in line with its "increasing influence".

In doing so "some of China's actions in pursuit of its interests have challenged the existing order" in a way that has - at timers - "raised tensions with neighbouring states and with the United States".

The briefing contained assessments on regional and international security, filtered by country and region.

When describing issues in the South China Sea, the briefing again focused on China, highlighting the creation and building of "multiple artificial island features in the Spratly and Paracel Islands upon which it has constructed bases".

"These posts now feature radar and communications arrays, airstrips and hangars, deep water harbours and weapons systems, which provide China with the ability to quickly deploy a range of additional capabilities in and around key international shipping lanes."

The 2017 briefing contained a limited assessment of areas and countries of strategic interest to New Zealand. In focusing on other nations - such as China - there was little that might be considered critical.

Serious Fraud Office

The Serious Fraud Office has warned of a likely spike in fraud because of Covid-19.

In the foreword to its Briefing for Incoming Minister, SFO director Julie Read says Covid-19 delivered extra challenges to the agency, partly because Government subsidies is an invitation to fraud.

"We are likely to see more serious financial crime over the coming years because of the Covid-19-related economic downturn and recovery with fraudsters seeing opportunities to defraud government emergency relief programmes and financial assistance packages rolled out in the wake of the pandemic."

The SFO has received $3.87m over three years from the Covid-19 Response and Recovery Fund to lead fraud and corruption efforts.

The briefing says that international and domestic experience has shown that serious and complex financial crime tended to increase during an economic downturn: "For example, during the Global Financial Crisis, many finance companies in New Zealand collapsed, resulting in the investigation of 16 companies and the prosecution of 29 individuals.

"Disaster recovery, which is accompanied with unusually high levels of investment and often with lower levels of integrity controls on that spending, also creates opportunities for large-scale fraud."

The BIM did not state whether any of its current investigations related to fraud of Covid-19 recovery packages, but said it was further boosting its workforce from 56 to 76 staff by early next year. A recent restructure had seen it add 17 extra investigative officers.

The SFO said about half of its current investigations and prosecutions related to corruption, and since 2014 there had been an increase in corruption complaints relating to the public sector.

"Given the potential impact of corruption cases on New Zealand's reputation, we have prioritised these matters."

The BIM did not specifically refer to investigations it was carrying out into donations received by Labour and the Auckland and Christchurch mayoral elections, or the charges laid against three people – former MP Jami-Lee Ross and two donors – relating to donations to the National Party.

One section advising of an issue the SFO intended to brief Police Minister Poto Williams on was blanked out.

The paper warns the new minister that its legal obligations for confidentiality in dealing with some issues would over-ride the usual 'no surprises' convention under which Government departments and agencies advise Ministers of matters that are potentially sensitive.

State Owned Enterprises

Treasury appears to expect three of New Zealand's major electricity companies will reduce dividends in 2021 due to the impact of Covid-19.

Following the partial sale under the previous National Government, the Crown owns 51 per cent of Meridian, Genesis and Mercury, three of New Zealand large five electricity retailers.

In a note on the state-owned enterprise portfolio, Treasury said some Crown controlled entities had been impacted by Covid, with support provided in some cases.

"Some companies pay the Crown an annual dividend; the majority of this dividend is received from a small sub-set of the companies, such as Meridian, Genesis, Transpower and, before 2020, Air New Zealand."

Air New Zealand stopped paying dividends this year as a result of the impact of 2019, but the electricity companies have continued to pay dividends.

Total dividends were $734 million in 2020, compared to $770m in 2019, Treasury said and while the dividend would be "resilient" it was expected to be lower next year.

"We expect the dividend to decrease in FY21 as the effects of Covid-19 continue," Treasury said.