Reporting entity
Te Tari Taake, Inland Revenue is a New Zealand government department as defined by section 5 of the Public Service Act 2020. The relevant legislation governing our operations includes the Public Finance Act 1989, Public Service Act 2020 and the Public Accountability Act 1998.
Te Tari Taake, Inland Revenue’s ultimate parent is the New Zealand Crown.
We are the principal steward of New Zealand’s tax and social policy system. This means we consider whether the products we administer, and the system as a whole, are effective and efficient, work as intended, achieve the intended outcomes and are fit for purpose. We do not operate to make a financial return and are a Public Benefit Entity (PBE) for performance reporting purposes.
The section on Our Performance covers all our activities as set out in the 2022–23 Estimates of Appropriations for Vote Revenue. It also includes other indicators from across our Performance Measurement Framework (PMF) as outlined in our Statement of Intent 2021–2025. The section on Our Performance relates to the year ended 30 June 2023. It was authorised for issue by the Commissioner and Chief Executive of Te Tari Taake, Inland Revenue on 28 September 2023.
Performance measures are reported on pages 67 to 108. Additional information, including on organisational capability, is not audited but provides additional context to our performance in 2022–23.
We also use performance information from our PMF to provide our organisation’s Enterprise Priorities and Performance Committee and other internal stakeholders with a regular update on performance areas at risk and to inform decision-making, planning and prioritisation.
Statement of compliance
The Our Performance section has been prepared in accordance with Tier 1 PBE financial reporting standards, which have been applied consistently throughout the period, and it complies with PBE financial reporting standards.
We have made judgements on the application of reporting standards and estimates and assumptions concerning the future, discussed below. The estimates and assumptions may differ from the subsequent actual results.
Critical reporting judgements, estimates and assumptions
Performance measures have been selected for our key activities. In selecting measures, we have made judgements to determine which aspects of performance are relevant and material to readers.
Te Tari Taake, Inland Revenue sets targets for output and asset performance measures based on a combination of historical performance, with consideration of factors that may impact future performance and opportunities for improvement. As such, future performance may differ from budgeted performance.
There were no pervasive constraints on information that influenced our service performance information.
Judgement is also involved in determining how to measure performance for the measures selected. The judgements that have the most significant impact on selection and measurement are disclosed below.
Given the size, diversity and complexity of our functions and services, we have grouped our material judgements under the following subsets:
- Policy advice
- Customer experience
- Service delivery
- Organisational health.
We review our performance measures each year. Any proposed changes are approved by our organisation’s Strategic and Investment Board—proposed changes to output measures are then approved by the Minister of Revenue. With the exception of policy advice measures and some externally mandated indicators within organisational health, we have discretion to select our measures and targets.
Policy advice
In keeping with the Policy Quality Framework provided by Te Tari o te Pirimia me te Komiti Matua, the Department of the Prime Minister and Cabinet (DMPC), we measure:
- the quality of our policy advice by applying the framework’s prescribed measures for quality of policy advice, and
- Ministerial satisfaction that all government agencies with a policy advice appropriation must apply.
This includes a target score for both quality of policy advice and Ministerial satisfaction. More information can be found at The Policy Project’s Progress and Performance section on DPMC’s website: dpmc.govt.nz
The Policy Quality Framework sets out a common set of standards that specify what good-quality policy advice looks like. Its purpose is to assess and improve the quality of our written policy and other advice, and whether it is fit for purpose. The advice may be for a Minister, Cabinet or other decision-makers, and may be jointly provided with other agencies.
Quality is assessed by an assurance panel that reviews a random sample of policy advice papers every year. The panel, made up of external and internal members, considers whether each paper meets or exceeds the quality standards of ‘acceptable’. Results are based on these characteristics:
- Context—the paper explains why the decision-maker is getting this and where it fits.
- Analysis—the paper is clear, logical and informed by evidence.
- Advice—the paper engages the decision-maker and tells the full story.
- Action—the paper identifies who is doing what next.
The overall result comes from calculating the average score of papers assessed using a 5-point scale.
The Ministerial Policy Satisfaction Survey contains a common set of questions provided by DPMC. The survey asks about general satisfaction, quality of policy advice and overall performance, using a 5-point scale. There are also 3 free-text questions about satisfaction.
The survey for the Revenue portfolio was discussed with the Minister of Revenue’s office. The Associate Minister of Revenue was delegated responsibility for completing the survey. The survey covered the entire year, during which the Associate Minister was either in that role or Under-Secretary of Revenue. The survey is done once per year.
Customer experience
Customer experience surveys are an important tool to help Te Tari Taake, Inland Revenue understand customers’ experiences and perceptions. Surveying our customers is critical for providing information for individual capability development and to support accountability and improvement.
Survey performance measures have been selected because they provide information on the impact of our services to customers. We use this information to understand whether the services met customers’ expectations, therefore contributing towards our broader outcomes. The PMF contains 11 survey-based measures from our:
- Customer Experience and Perceptions Survey (CX&P)
- Audit Satisfaction Survey
- Survey of support services provided to the New Zealand Productivity Commission (NZPC).
Our largest survey, the CX&P, is an ongoing monitor that helps us measure trust, tax morale and customer experience over time. This continuous, online survey includes weekly random samples of the general public and those who have recently had an interaction with us.
Actual performance is measured from respondents’ ratings on a 7-point scale. Results represent respondents who gave a score of 5 or more. In 2022–23, we received 8,323 responses. The survey was run on behalf of Te Tari Taake, Inland Revenue by Kantar Public.
The Audit Satisfaction Survey asks customers who have been audited their views on the quality of the process across a number of aspects such as: communication, education, how the auditor conducted themselves, timeliness, impacts on the customer and overall experience.
Actual performance is measured by customers rating their experiences on a 5-point scale from ‘strongly disagree’ to ‘strongly agree’. The result represents an aggregate of responses for scores of 4 or more (‘agree’ or ‘strongly agree’). The survey is run quarterly and reported internally twice in the reporting year and once externally. The survey anticipates a minimum response of at least 80 customers.
The NZPC survey seeks annual feedback on the level and quality of support services we provided to NZPC, and where improvements could be made. The survey seeks feedback on the timeliness and quality of:
- accounts payable and receivable transactional services
- financial reporting services
- tax return and payment services, and
- human resource and payroll services.
Actual performance is measured from NZPC’s ratings on a 5-point scale for scores of 4 or more.
Service delivery
Te Tari Taake, Inland Revenue reviews service delivery measures each year to ensure key products or services are represented in our measures, and that our measures are balanced, meaningful to customers and reflect our operating environment. Measures focus on the quality, timeliness and cost of services. They are a commitment of what we will deliver with the funding provided.
Quality
We monitor the quality of our rulings reports, adjudication reports and public items produced to ensure they meet the standards required. An evaluation of whether we have met standards is done by reviewing a random sample of 25% of each report type. Reviews consider whether the contents of reports and items 112 Annual Report 2023 meet the applicable purpose, logic, alternatives, consultation and practicality standards. For instance, that templates include overt consideration of alternative arguments raised and consideration of consultation comments.
Reviews are done by senior staff members who were not involved in the adjudication, ruling or public item.
Timeliness
Timeliness in responding to customer activities is an important part of our role to make it easy for customers to meet their tax obligations and receive their entitlements. Measures cover key activities such as customer registrations, processing returns and payments, answering customer queries, managing debt and unfiled returns and providing rulings and advice.
Cost
- A number of cost-based measures in our Performance Measurement Framework demonstrate the cost effectiveness of our activities. We allocate costs to business services, appropriations and products. Cost allocations include 2 components:
- Direct allocations, where activities contribute directly to an appropriation or category and can be mapped directly to 1 or more business services.
- Indirect allocations, where cost centres do not contribute directly to an appropriation or category and cannot be linked directly to a business service. The allocation rule for these is based on the weighting of ‘direct allocations’ for the direct cost centres that this indirect cost centre is aligned to.
We review direct allocation rates twice a year to ensure that the existing allocations for an individual cost centre still accurately reflect how the cost centre expends its effort.
Organisational health
Organisational health indicators provide information on how Te Tari Taake, Inland Revenue is using our resources to deliver for customers and government and ensure performance is sustainable. A number of indicators are externally mandated such as targets under the Carbon Neutral Government Programme, gender pay gap reporting and timeliness in paying invoices to domestic suppliers.
Performance measure footnotes or additional information
Te Tari Taake, Inland Revenue includes footnotes or additional information for some performance measures. We applied these criteria to ensure disclosure of the most relevant and useful information:
- The reason for not achieving a particular target.
- The reason for achieving 15% above a target.
- Assessment criteria used such as the survey scale.
- Any change in measurement methodology from the previous year.
- Any correction to a previously reported result.
- Clarifying which products or services are included or not included in the result, or the date or timing to which the data relates.