Publications

Annual Report
2003-2004

Statement of Intent - Performance Measures Report

Following is a list of the Commission’s objectives and performance measures from its Statement of Intent and an indication of progress during the year.

Claims Handling and Catastrophe Response

All claims on the Commission are completed to the standards set within the catastrophe response programme.
Performance measurements

  1. Ensure the levels set in all service level agreements with service providers have been met, in times of normal and abnormal activity.
    Achieved.
  2. Meet the requirements of the catastrophe response programme training and exercise programme.
    Achieved. Ten training activities and nine tests and exercises were carried out.
  3. Work with Civil Defence and Emergency Management Groups as they are set up, to help meet joint objectives related to managing repairs and reconstruction of housing.
    Achieved. Eight liaison visits to CDEMGs.

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Management of the Natural Disaster Fund

The performance of investment and protection activities is in accordance with best practice.
Performance measurements

  1. Diversify investments to include an allocation to global equities in accordance with the terms of the Minister’s directive for the investment of the Fund.
    Achieved.
  2. Improve the real value of the Fund (excluding cash held as working capital) over the medium term utilising a mixture of assets designed to:
    1. Achieve an average rate of return of at least 1% p.a. over the Crown’s cost of borrowing over a rolling 10-year period;
    2. Subject the Fund to no more than 1 chance in 4 that over any 10-year period the annual rate of return will be less than the Crown’s cost of borrowing;
    3. Ensure that there is no more than 1 chance in 30 of the Fund incurring an investment return of less than negative 2% in any one financial year.
      Achieved.
  3. Meet or exceed the performance benchmarks set by the Board for individual investment classes and maintain the safe-keeping of assets in accordance with best practice.
    All individual investment classes except international equities met or exceeded performance benchmarks. The full international investment programme was not implemented for the whole period. Safe-keeping of assets was done in accordance with best practice.
  4. Ensure cash inflows from investments, reinsurances and other financial protection policies are sufficient to meet all claims and other liabilities under foreseeable circumstances.
    Achieved.
  5. Meet best practice for the transfer of insurance risk and financial protection of the Fund, which:
    1. With the Fund’s investment strategy, provides optimal cost/benefit and risk management;
    2. Implements a reinsurance programme providing stability over time against reasonably foreseeable events;
    3. Provides flexibility in the reinsurance agreement terms and conditions should the Crown determine a different risk profile under the natural disaster insurance scheme in the future;
    4. Controls the risk to the Commission of default amongst reinsurers/capital markets.
      Achieved.

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Administration of the Scheme

Fair and consistent administration of the scheme, including efficient verification of insurance coverage at the time of a claim.
Performance measurements

  1. Maintain a programme of physical checks and commercial audits which adequately verifies the integrity of the premium payments by insurance companies.
    Achieved.
  2. Complete the compilation of a database of insureds for statistical and analytical purposes, subject to insurance industry co-operation.
    Insurance industry co-operation has not been achieved.

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Public Education

Increased public awareness of the vulnerabilities and of steps that can be taken in the home to mitigate these; more households have taken precautions against damage from seismic events.
Performance measurements

  1. Review the current 5-year communication strategy which is reaching its end, and develop a strategy for the next period.
    Achieved.
  2. Manage the Te Papa sponsorship 5-year contract to ensure EQC receives the expected benefits detailed in the business plan.
    Achieved.

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Research and its Evaluation

In order to build safer communities, the potential for damage caused by natural disasters as defined in the Earthquake Commission Act is reduced by:

  1. Providing support for learning activities and research projects;
  2. Generating, disseminating and applying knowledge;
  3. Developing relevant skills and community capability.
    Performance measurements
  1. Carry out the contestable grants round in accordance with the approved timetable and procedures, and monitor for satisfactory project completion.
    Achieved.
  2. Work with other users, providers and funders of research to ensure risk readiness, reduction, response and recovery activities are underpinned by the necessary knowledge to make them effective.
    Achieved.
  3. Support GeoNet in accordance with approved budgets and procedures, and monitor successful delivery of planned outcomes.
    Achieved.

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Promotion of EQC and its Role

Increased knowledge and appreciation of EQC and its work in order to minimise confusion and misunderstandings which impede EQC’s operations.
Performance measurements

  1. Increase correct awareness of the roles of EQC to 80% by June 2005 according to quarterly surveys.
    Achieved 67%.
  2. Sponsor public exhibits which enhance awareness of the roles of EQC and natural disaster matters.
    Achieved.

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Policy and Advice

Crown policy with regard to its ownership and management of EQC is in accordance with cohesive and sound risk management principles and commensurate with the Crown’s overall responsibilities.
Performance measurement

  1. Complete the review of the insurance scheme provided under the Earthquake Commission Act and Regulations, and make recommendations through Treasury.
    Achieved. To be submitted to the Minister by Treasury by the end of November 2004 as part of the review of EQC.

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Financial Management

Financial reporting requirements are met and audit reviews show standards required by the Board have been met; expenditure is within the budget approved by the Board and Minister.
Performance measurement

  1. EQC Financial Statements meet standards required by the Board, as attested by the Commission’s auditor.
    Achieved.

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