Monitoring: Advice from Treasury
Treasury advises government agencies that they need to establish good information sources and be focused on results when monitoring funding arrangements with NGOs.
Monitoring
Establish information sources
Monitoring will be based on:
- information reported by the NGO in accordance with the contract
- information from other parties, for example, surveys of users
- the ongoing relationship with the provider
- reviews or audits conducted under the contract
- information from other sources.
Focus on outcomes
Government agencies want NGOs to deliver services under the current contract, but also have an interest in their future viability. Reports should not only focus on inputs to or outputs from the NGO's activities, but should indicate improvements in outcomes.
Determine levels of monitoring
The level and nature of the monitoring undertaken by a government agency may differ because of:
- the nature of the service
- the track record of the NGO
- the amount of money involved
- perceptions of risk.
Some government agencies monitor contracts for relatively small amounts of money by requiring some minimum reporting as a matter of course, and providing for a power to do a more in-depth audit. The government agency can then audit perhaps one in 10 such contracts, either randomly, or as a risk assessment, or a mixture of the two. This could include an audit of the government agency's contract management, as well as of the performance of the NGO.
Government agencies need to exercise informed judgment about such monitoring arrangements and where the agency’s resources are best directed (see also section 1.7).
Monitor appropriately
Māori, hapū, and iwi providers report that monitoring and reporting processes should focus more on outcomes collectively desired by Government and Māori communities. These outcomes should also be culturally appropriate and relevant to the model of service provision.
Managing ongoing relationships
Government agencies and NGOs need to understand each other's expectations of the way the relationship will be managed, and managing the contract is part of this. Where the relationship is working well, there will usually be no need to enforce the terms of the contract.
Understand each other
Government agencies should ensure they understand the culture and language of service recipients and the NGOs they contract with.
Record expectations in contracts
Use the contract to record the basic expectations each party has of the other.
Communicate concerns
The government agency must inform the NGO of any concerns about performance under the contract. NGOs should also be encouraged to provide feedback on the government agency's performance.
Specify a contact person
It may be sensible to specify a senior contact person to be available to NGOs to help resolve difficulties.
