Annual Report 2016-17 cover

Strengthening our organisational health, capability and culture to allow us to operate as a cohesive, integrated agency

Strengthening our people, capability and culture

The establishment of the Ministry for Vulnerable Children, Oranga Tamariki from 1 April 2017 had implications for our workforce in terms of our size and the way we work. We invested considerable effort in the development of a shared services model for the delivery of ‘backbone’ functions that help agencies run smoothly and efficiently.

We remain committed to enhancing the capability of our people and to fostering a constructive organisational culture to drive performance. Our People Strategy, which we launched in 2016, articulates four broad themes: supporting our people to perform at their best, moving towards a more planned approach for an increasingly responsive workforce, building our leadership capability, and orienting our organisation and workforce around our clients. These themes are underpinned by our principle of embedding a constructive, collaborative and innovative corporate culture.

In 2016/2017 we maintained the momentum of our Building Blue leadership initiatives. We coached 63 senior and middle managers around the Life Styles Inventory (LSI™) 360 degree feedback tool, which supports the organisational culture and leadership programme.

Enhancing our change capability

We continue to invest in growing our change management capability to support our delivery in a dynamic environment. This has involved maintaining a change champion network and including a change management module in our new manager induction programme.

Equal employment opportunities

Our equal employment opportunities (EEO) policy promotes equality and diversity within a culture that is based on respect, fairness, and valuing of individual differences.

In 2016/2017 we worked collaboratively with the State Services Commission to support the Lead Toolkit for employing disabled people in the state sector and with other agencies to identify and share best EEO practices.

Supporting a diverse and inclusive workplace

In 2017 we began the development of an organisation-wide Diversity and Inclusion Strategy to identify future opportunities that will enable a diverse and inclusive working environment across all organisational levels.

We are committed to supporting the State Services Better Public Services 2.0 Diversity and Inclusion approach, which includes addressing the gender pay gap, participating in the systems profile stocktake, and effectively reporting on diversity and inclusion initiatives and outcomes.

Our workforce is predominantly female, more so than across the Public Service as a whole (71 percent compared with 61 percent). However at senior manager/executive level, females occupy less than 39 percent of the roles.

Our gender pay gap (the difference between the average salaries of male and female employees) is also higher than the overall Public Service figure, at 14.7 percent in favour of males compared with 13.5 percent. For the majority of our staff there is little or no gender pay gap: in fact, in the largest occupational group (social, education and health workers) the gap is 0.42 percent in favour of females. However the salary difference is most evident in the managerial occupational group, which has the lowest representation of females of all our occupational groups.

We are committed to supporting the Government’s objectives for the Public Service of addressing the gender pay gap, participating in the systems profile stocktake, and effectively reporting on diversity and inclusion initiatives and outcomes.

The graphs below provide our demographic breakdown.

Gender distribution by level

gender distribution by level

Diversity statistics by gender

diversity statistics by gender

Diversity statistics by ethnicity

diversity statistics by ethnicity

Diversity statistics by ethnicity

Developing effective leaders who back their people to succeed across all levels remains a priority for creating an effective culture. Over the past year we have engaged with our leaders to identify what is working well, barriers to leadership development and performance, and opportunities for improvement. We have developed an overarching leadership development strategy and a talent and succession framework to attract, develop and engage our present and future leaders across MSD.

We have more leadership development opportunities, and graduates, than ever before:

  • Emerging Leaders supports high-performing people who have the potential and aspiration to move into their first management role – 215 people have graduated since its launch, 16 over the past year
  • Te Aratiatia supports high-performing Māori and Pacific people to move into their first management role – 14 people have graduated over the past year
  • Te Aka Matua supports Māori and Pacific leaders to complete their Master’s degree in Public Management – seven people commenced their studies this year
  • MSD Study Awards provide an opportunity for staff to pursue a significant programme of their choice that will benefit themselves and the Ministry – ten awards were made last year
  • Our New Manager Programme involves a suite of workshops for first-time leaders with core management and leadership skills – 32 people have graduated over the past year.

Leadership and governance

Leadership is the single most critical driver of successful change. Given the scale of change we have faced in the last year and will continue to face, it is essential we have strong leadership in place.

Our governance arrangements support whole-of-Ministry leadership and decision-making.

Our Leadership Team is made up of our Chief Executive, five Deputy Chief Executives and the Director of the Office of the Chief Executive. These leaders have collective responsibility for ensuring our organisational health, capability and capacity to deliver services and achieve outcomes.

In 2016/2017 five governance sub-committees of the Leadership Team supported strategic decision-making across the organisation:

  • Information Management Governance Committee
  • Finance and Portfolio Governance Committee
  • Corporate Capability Governance Committee
  • Policy and Cross-Social Sector Committee
  • Health, Safety and Security Governance Committee.

We reviewed this governance framework in the first half of 2017 to ensure it remained fit for purpose, and introduced a new framework in July 2017.

Independent Risk and Audit Committee

The Risk and Audit Committee provides critical support to the Chief Executive through independent advice and challenge on risk, internal control and assurance matters. The Committee’s advisory role provides an alternative perspective on risk management and internal control, internal assurance, external audit, financial and performance matters, and governance frameworks and processes. The perspective provided by the Committee is of critical importance in a time of change for the Ministry.

The Committee met four times during 2016/2017 and comprised four independent external members:

  • Graeme Mitchell (Chair)
  • Kristy McDonald
  • Linda Robertson
  • Sir Maarten Wevers.

The Committee provided advice and assurance on the following key areas of our programme of work:

  • the strategic change programme, including the Transformation programme
  • health, safety and security
  • emergency housing
  • simplification
  • cybersecurity
  • historical claims
  • shared corporate services
  • holiday pay compliance.

Maintaining stable industrial relations

In 2016/2017 we successfully concluded negotiations in relation to our four main collective agreements (Service Delivery, National Office/MYD, and Child, Youth and Family [60]).

We have sought to maintain constructive union relationships through engagement, particularly in relation to significant change such as in the area of health, safety and security and the establishment of Oranga Tamariki. In addition, we have agreed a work programme arising out of collective bargaining, to encourage progress towards joint commitments. Through our collective bargaining, we have also agreed with the Public Service Association (PSA) to identify appropriate ways to support staff who make key contributions through their knowledge and skills of te reo and tikanga Māori.

MSD union membership is 57 percent. Of those union members, 98 percent belong to the PSA.

Human Resources Management System

Getting accurate data and a single source of employee information is an important step in enabling better decision-making and allocation of resources. As well as improving the visibility and capability of our workforce, it increases organisational consistency and compliance.

In November 2016 we introduced the first modules of a new Human Resources Management System (SAP SuccessFactors). This cloud-based system, part of an all-of-government procurement, is a significant investment in our corporate infrastructure.

In the first wave of implementation we introduced core employee data, organisation structures, leave management, recruitment and onboarding. This implementation was a significant organisational change and coincided with higher than normal recruitment volumes and increased support needs because of the establishment of Oranga Tamariki. The changes are taking more time to embed than expected and work is continuing to make sure the system and business processes are well aligned.

Shared corporate services with Oranga Tamariki

As part of system reform, the Government agreed in 2016 that MSD would provide a range of shared corporate services to Oranga Tamariki for at least the first two years of its operation.

We agreed with Oranga Tamariki a series of service level agreements, and we have provided services in accordance with these agreements since 1 April 2017. We have actively managed any issues that have arisen in partnership with Oranga Tamariki.`

New Zealand Business Number

We have established a steering group to oversee the implementation of the New Zealand Business Number (NZBN) within MSD. The steering group will ensure compliance with Government directives and will implement the NZBN where it provides an advantage to us and our clients.

Our Client Management System (CMS) uses the NZBN in the provider database to identify businesses and community organisations that interact with MSD (ie where a NZBN has been adopted) and has begun adding the NZBN to records in preparation for using it as a unique identifier. It is now mandatory for CMS users to enter the NZBN when creating new records for providers registered with the Companies Office.

Resolving complaints and grievances

Chief Executive’s Advisory Panel on Child, Youth and Family complaints

The Chief Executive’s Advisory Panel was the second stage of the Child, Youth and Family formal complaints process up to 31 March 2017. Complainants who were unhappy with Child, Youth and Family’s response to their complaint were able to request a review by the Chief Executive. The Panel assisted the Chief Executive’s review of the complaint by providing a ‘fresh pair of eyes’ independent from MSD, and was made up of independent members who are appointed on the basis of their credibility, community standing and professional respect.

Between 1 July 2016 and 31 March 2017 the Panel received 63 requests for a review, and 60 requests were closed. Twelve of the 60 closed complaints were found to be outside the Panel’s jurisdiction, and four were withdrawn. A further 27 requests were referred back to Child, Youth and Family as they had not been through an internal review.

The Panel heard 19 complaints during this period.

The Chief Executive made decisions on 15 complaints during the period; of these eight were upheld in full and five in part.

On 1 April 2017 Oranga Tamariki took over the functions of Child, Youth and Family, including the formal complaints process. All requests for a Panel review on hand with the Review Secretariat at 31 March 2017 continued to progress through the Panel review process.

Departmental asset services and asset management

Asset services

Our assets enable us to visit clients, communicate, facilitate face-to-face discussion, and meet together online. Many of these assets support services of significant national importance, and maintaining their fitness for purpose and their availability is essential in allowing us to continue to provide services to our clients.

Our asset management practices are designed to optimise the Government’s investment in social services for the benefit of all New Zealanders.


Our ICT assets play a critical role in ensuring that we can provide services in a timely way, reliably, efficiently, and in accordance with current government policy and legislation. Our investment in systems has enabled us to support increased activity through online digital channels.

We continue to work with the Office of the Government Chief Information Officer, which leads and assists agencies in meeting their goals for the effective use of technology.


Our property assets comprise mainly leased commercial office properties. These assets house our staff and enable us to facilitate face-to-face engagement with stakeholders and clients.

We actively collaborate with the Government Property Group and other government agencies to provide effective and safe office accommodation.

Motor vehicles

Our aim is to provide fit-for-purpose, safe vehicles at the lowest total cost of ownership to enable our people to carry out their core functions. The fleet is going through a period of significant change, with the introduction of a new fleet management system that will give us a national view of our fleet and access to meaningful data that will enable us to better meet our transport needs.

We work with the Ministry of Business, Innovation and Employment and participate in an all-of-government vehicles contract to optimise our procurement opportunities.

Asset management

Strong capital asset management and investment management practices are critical to our long-term success. This ensures best value for money from the assets needed to deliver fundamental government services.


[60] There were two collective agreements for Child, Youth and Family before 1 April 2017.