Health Research Council of New Zealand

Health Research Council of New Zealand

Statement of Intent 2010 - 2013

Phone: +64 9 303 5200 Fax: +64 9 377 9988

Level 3, 110 Stanley Street, Auckland 1010

PO Box 5541, Wellesley Street, Auckland 1141

www.hrc.govt.nz

ISBN: 978-1-877495-04-5

Table of Contents Summary ................................................................................................................................ 1

Part 1: The HRC’s Five-Year Framework – Operations and Outcomes ...................... 4

Introduction........................................................................................................................ 4

Operating Environment.................................................................................................... 4

Scope of HRC’s Functions and Intended Operations................................................... 5

Our Operating Intentions ................................................................................................... 8

Managing Organisational Health and Capability....................................................... 14

Reporting/Information for Owners/Funders............................................................. 15

Part 2: Statement of Service Performance ...................................................................... 16

Financial Statements .......................................................................................................... 26

Acquisition of Shares......................................................................................................... 36

Information on the Organisation .................................................................................... 36

Statement of Intent 2010 - 2013 1

Summary

The Health Research Council of New Zealand (HRC) is a Crown Agent that invests in health research. HRC currently funds health research in more than thirty different research “host” organisations, and at June 2010, there is $170-180M committed to active contracts, some of which will run for more than three years. HRC’s research contracts support around 515 full time equivalent researchers; given that many researchers are supported only part-time on an individual research project, this translates into a HRC-supported workforce of approximately 1,500 individuals. In identifying which health research to fund, HRC uses an international best practice model based on contestability and peer review. We use both international and local (NZ and Australian) experts to provide thorough scientific review of research proposals. HRC uses rigorous processes to avoid conflict of interest in decision making. All active research contracts are monitored by HRC at least annually for progress towards the stated outcomes. Our responsible Minister is the Minister of Health, although funding for research investment comes through Vote RS&T. HRC supports research that will grow knowledge relating to health and illness, and inform health sector policy and services. That knowledge transforms into both economic gains through creation of new products and services, and into longer, healthier and more independent lives for New Zealanders by contributing to improved health and disability services and the protection and promotion of good health. HRC will deliver four outputs; health research contracts, health research career development contracts, co-funding relationships and support to policy, ethical and regulatory frameworks.

Health research contracts HRC has streamlined funding application processes, thereby reducing transaction costs for research host organisations. The money invested in any year is for a mixture of ongoing research (approved in previous years) and for new research proposals. At the end of December 2009, there were 214 active health research contracts. There are always more high quality research proposals, judged worthy of funding, than the budget allows, therefore some prioritisation is required. In the coming year we will implement new funding priorities, to support research meeting health sector needs, underpinned by a high quality research workforce. Research investment of $76.88M will be made in four priority areas, termed Research Investment Streams:

Research for New Zealand Health Delivery, aiming to deliver research that will influence health service delivery and policy within a five year time frame (approximately 20% of new investment);

Improving Outcomes for Acute and Chronic Conditions, specifically

understanding, prevention, diagnosis and management of a wide range of conditions that impact on the lives of New Zealanders, such as stroke,

2 Statement of Intent 2010 - 2013

cardiovascular disease, cancer and respiratory disease (approximately 35-40% of new investment);

Rangahau Hauora Māori, focusing on research that will improve Māori

health outcomes and quality of life (approximately 5% of new investment), and

Health and Wellbeing, this priority recognises that staying healthy is the

best long term strategy to reduce demand on the health system. Research will focus on maintaining health and wellbeing throughout the life course, and includes, but is not limited to, reproductive health, health promotion, mental health, injury prevention and infectious disease (approximately 35-40% of new investment).

Health research career development contracts HRC supports the recruitment, education, training and retention of those engaged in health research through targeted career development awards. Our awards are mainly aimed at developing the health research workforce in areas where there is evidence of low capacity and capability, these being the Māori, Pacific and clinical research workforce. In addition, HRC offers up to three significant awards per year for upcoming research stars; these Sir Charles Hercus Health Research Fellowships are valued at $0.5M over four years and are aimed at those transitioning from postdoctoral researcher to research group leader. At the end of December 2009, there were 130 active career development contracts. In the coming year, HRC intends to invest $6.10M in this area.

Co-funding relationships HRC’s Partnership Programme establishes and manages health research co-funding relationships with a wide range of government and non-government organisations. By coordinating needs and funding across organisations, these partnerships make efficient and effective use of scarce resources. At the end of December 2009, partnerships were supporting 41 active research contracts and HRC was leveraging $2.97 of partner funding for every dollar of Vote RS&T funding. Additionally, HRC supports the development of international research partnerships that return gains for New Zealand, such as access to equipment, expertise, resources or overseas funding. There were 18 such contracts at December 2009. In the coming year HRC will invest $5.96M in contracts that involve partnering, to support research in areas as diverse as tobacco control, oral health, prostate cancer, clinical trials (collaboratively with Australia) and cardiovascular disease (collaboratively with A*STAR in Singapore). All research contracts are subject to HRC’s usual stringent quality assessment and monitoring.

Contribution to policy, regulatory and ethical frameworks In the coming year, HRC will expend $0.4M to support activities that complement the more direct investment in health research. This includes support for HRC committees to provide independent ethical advice and accredit all health and disability ethics committees, to provide independent monitoring of large clinical trials in New Zealand to ensure safety for participants, to provide advice to the Director General of Health on proposals for clinical trials using modified, synthesised or non-human origin nucleic acid, and to provide advice to the Director


General of Health on applications to use medicines for clinical trials under Section 30 “Exemption for clinical trial” of the Medicines Act (1981). Mr Robert Stewart ONZM Professor Richard Beasley Chair Deputy Chair


Part 1: The HRC’s Five-Year Framework – Operations and Outcomes

Introduction The Health Research Council of New Zealand (HRC) is the Government’s principal Funding and Investment Agent for health research. The HRC’s major activity is investing in health research; some proposed by health researchers themselves, some sought through directed requests for proposals on specified topics, and through training and development support for the research workforce in areas where the workforce is weakest. The HRC provides internationally best practice processes to ensure that only high quality research that will deliver outcomes is supported. This Statement of Intent describes the activities to be conducted by the HRC in 2010/11 in the relation to our medium term goals. It is in two parts; Part 1 provides a longer term context for HRC’s plans, while Part 2 describes specific activities, investments and performance measures for the next twelve months.

Operating Environment The HRC was established as a Crown Entity in 1990, to administer part of the Government’s investment in health research. In 2005, the HRC became a Crown Agent - required to give effect to the general policy of the Government in relation to health research. Although the Minister of Health is the responsible Minister for the HRC, we receive much of our funding for research-related activities from Vote Research, Science and Technology, with a smaller component from Vote Health. The relationship between the Minister of Health and Minister of Research, Science and Technology is covered by a Memorandum of Understanding. While HRC is the government’s principal purchase agency for health research, significant public funds also are invested in health research through the Marsden Fund, the Foundation for Research, Science and Technology and the Tertiary Education Commission.

Addressing Government Priorities The primary outcome that HRC seeks to achieve is that New Zealand gains benefit through health research. This HRC outcome will contribute to the two health and disability system outcomes:

New Zealanders living longer, healthier and more independent lives, and New Zealand’s economic growth is supported.

In brief, HRC will support research that makes a difference to the health and well-being of New Zealanders. Research will deliver the evidence for new treatments, for managing illness and development of health policy, and for improving effectiveness and efficiency of the health system. This will be achieved by investing in a mix of research, some of which is likely to have impact in the short term, but also some that is more basic and will have a longer time to potential outcome. In addition to the impact of a healthy population on economic growth, the HRC will support research


that creates new knowledge that can be turned into products and processes that have commercial value. Health research is one of the priority research outcome areas for the Government’s investment in Research, Science and Technology (RS&T). The HRC will work with the other funding and investment agencies in the RS&T sector to deliver research within the priority framework. Additionally, HRC will continue to work to simplify the processes for researchers seeking funding, to limit the transaction costs and to ensure value for money in the health research investment. In the 2010/11 Letter of Expectation from the Minister of Health, particular emphasis was placed on HRC working collaboratively with both the Ministry of Health and MoRST to maximise the benefits from New Zealand’s investment in health research. The Letter of Expectations also notes the Government’s new set of priorities for RS&T; the current Statement of Intent aligns with the new Vote RS&T structure. Work initiated in 2008/2009 is reflected in changes to HRC’s major investment process, the annual funding round. In 2010/11 the final elements of the restructuring will be introduced. The changes (see page 17) will better target the health research investment, simplify the process and reduce transaction costs for research providers.

Scope of HRC’s Functions and Intended Operations The framework for the HRC’s work is provided by the Health Research Council Act (1990). HRC undertakes two broad functions mandated by the Act. 1. Invest in high quality health research that will benefit New Zealand. The HRC issues contracts for specific research, based on proposals sought within constraints set by Council and published annually. The Universities of Auckland and Otago are the two major health research providers, but there is an increasing number of other organisations capable of delivering health research and which have been supported by HRC. These include other universities, the Crown Research Institutes, District Health Boards, health research institutes and a range of other public and private research providers. In 2009/10 more than 25 different organisations received HRC funding. The HRC determines priorities for research investment, to ensure the best use of its funding. In setting priorities, HRC consults with a wide range of stakeholders and in the 2009/10 year a major adjustment of priorities and funding processes was undertaken and will determine the research that is supported from 2010 onwards. The HRC uses contestability of funding and peer review of research proposals as tools to ensure the quality of the contracted research and, therefore, to maximise the quality of research outcomes. Each research proposal undergoes our international best practice model of peer review. This involves proposal review by external research discipline specialists as well as by committees comprising experienced New Zealand and Australian research experts. Scrupulous attention is paid to avoiding conflicts of interest during the proposal review and funding approval process. All research receiving funding demonstrates a combination of high scientific merit and


relevance to health. Details of the HRC investment strategy and assessment processes are published annually (www.hrc.govt.nz), and all funding decisions are made by the HRC Board. To ensure contracted research meets its objectives, funded researchers are required to report at least annually and progress is reviewed. 2. Support the recruitment, retention and training of the health research

workforce. Workforce support is provided through a variety of mechanisms. Salaries of researchers are paid as part of health research contracts, and there are specific schemes that benefit clinicians and emerging researchers. The HRC also provides targeted scholarships and fellowships in areas where there is a demonstrable gap in capacity of the workforce, with the purpose of ensuring that New Zealand has the health research capacity to deal with current and future challenges.

The HRC's Outcome Framework The following schematic shows the HRC's outcome framework, and provides the structure for reporting our medium-term information and annual performance. The HRC has identified four outcomes it seeks to achieve in the medium term; research addresses NZ health needs, research contributes to international advances, benefits from research are maximised, and the health research environment is ethical responsive and compliant. For each of the outcomes, we have identified several impacts that will make a difference.


The HRC's Outcome Framework

Inputs

Vote RS&T Allocations, Output Expense: Research Contract Management, Health & Society, International Relationships, & Vision Mātauranga Capability Fund (funds to output

links, p16)

Vote Health funding for HRC Output: Research Support Activities

Overarching Outcome: New Zealand Benefits Through Health Research

Outcomes Where HRC Has Influence

1. Health research addresses NZ needs

2. Research contributes to international

advances

3. Benefits of health research are maximised

4. Health research environment is

ethical, responsive & compliant

Research addresses key health priorities

Capacity built in priority areas

Development of health technology

& innovations

Support for best people & ideas

Support promising early career researchers

International research collaborations supported

Uptake of research findings facilitated & promoted

Engagement of end-users in research

High-quality ethical consideration

Responsiveness to specific groups

Compliance to regulatory requirements

Intermediate Outcomes (Impacts)

Outputs

1. Health research contracts

2. Career development

contracts

3. Co-funding relationships

4. Contribution to policy, regulatory

& ethical frameworks


Our Operating Intentions

Outcome 1: Health Research Addresses New Zealand Needs

Why is this important? New Zealand has a unique and diverse population and our geographic and demographic characteristics present us with challenges that mean we cannot rely solely on health research conducted in other countries to meet our needs.

What will we do to achieve this outcome?

We will align our investment with government and health-sector priorities …

To this end we are restructuring our investment processes to more simply and clearly reflect our priorities and those of our stakeholders. We will replace our nine Research Portfolios with four Research Investment Streams and issue annual Investment Signals for each stream that clearly communicate the priorities for investment.

… build capacity and capability to conduct research in priority areas …

We will address key capacity and capability gaps through targeted support for emerging researchers and through our Career Development Awards in the priority areas of Māori health research, Pacific health research and clinical research. Māori health research and research paradigms will be specifically supported through the Rangahau Hauora Māori Research Investment Stream. The HRC's framework for supporting Māori health research, which includes our peer review model to ensure research excellence, and requiring that applicants for funding address responsiveness to Māori has been considered a 'best-practice' model by research funders overseas.

… and support the development of technologies that will advance health delivery and bring economic benefits for New Zealand …

HRC-funded research has resulted in technological advances, which benefit New Zealanders through improved diagnosis, management and treatment of disease but also through their potential impact on the New Zealand economy. We will continue to support top researchers and the best research ideas to gain knowledge critical for technological advances. Support for health technologies is a focus of the Research for New Zealand Health Delivery Investment Stream.

How will we measure if we have been successful? We have set targets that will challenge us but are achievable without increased funding.


Impact Indicator & Baseline Performance

5-yr Target 2016

Research addresses key health priorities Our processes should ensure our investment strategies are aligned with the key priorities outlined by the Ministry of Health and MoRST. These strategies should remain fairly constant to allow the research community to respond over a number of years.

Alignment with the key health research priorities of the Ministry of Health and MoRST (baseline: new measure).

Full alignment achieved by

2011 & maintained.

Percentage of career development awardees successfully gaining research qualifications (baseline: 85%).

85% Capacity built in priority areas Training young researchers in priority areas results in the right expertise for design and conduct of research and the networks to promote uptake of research findings. We should see an increase in the number of investigators qualifying, and participating on research contracts. Māori, Pacific &

clinical researchers participating on research contracts (baseline: Māori 12% FTEs1, Pacific people 1% FTEs, Clinicians 10% FTEs. Increase by 25% over five years).

Māori 15%, Pacific 2% &

clinicians 12.5%

Number of new methodologies and techniques developed by researchers (baseline: new measure).

20 Development of health technology and innovations Our actions to fund high-quality, oriented-basic research will lead to new discoveries, and translation into health benefits.

Number of new spin-off companies arising from HRC-funded research (baseline: new measure).

3

1 Full-time equivalents, a standard measure for calculating workforce contributions - full-time is 1.0. Researchers split their time across a wide variety of different projects and activities and so workforce hours must always be calculated using FTEs.


Outcome 2: Research Contributes to International Advances

Why is this important? Being well connected to the global research effort means the health sector will get early access to advances in treatment that will benefit patients in New Zealand, as well as overseas findings that can be adapted to New Zealand populations and conditions. Linkages to the international research community develop when researchers’ expertise is known and valued.


We need to ensure that we support the best people and best ideas ...

We will continue to invest in the highest quality research, identified via a rigorous peer-review system. The success of this system means those funded are well placed to form the international linkages.

... support promising health researchers early in their careers ...

We will support the best emerging health researchers through the Sir Charles Hercus Research Fellowship scheme. We need to keep these scientists in New Zealand so that they can be trained and mentored by the individuals that they will ultimately replace - keeping our future workforce strong and respected internationally.

... and actively facilitate international research collaborations.

Collaborations between New Zealand researchers and international collaborators will be supported. For example, the HRC has formed a successful partnership with the Canadian Institutes of Health Research and the Australian National Health and Medical Research Council in the field of indigenous health research.

How will we measure if we have been successful? One of the most important actions that we can take under this Outcome is to ensure that we are funding the very best health research, and the people that will take their novel findings into the global arena. Consequently, our performance measures here relate to assessing the quality of the research that we fund, in comparison to other agencies in New Zealand and overseas. The best way to do this is to conduct a bibliometric survey of international health research literature, looking at peer-reviewed publications in indexed journals2. We plan to undertake this survey at least every five years; the last survey was completed in 2007 for contracts funded in the five years to 2001, to allow for lag-time in publication of findings3. Around the world, publications rates and citations are the benchmark on which academic performance in most fields of research is judged. We can also judge our success by the resources we have managed to leverage for New Zealand through the international partnerships we have created and facilitated. 2 Those indexed by the Institute for Scientific Information (Thomson ISI) which maintains databases on the impact of all the journals which they have indexed and the number of times each publication within them has been cited in other indexed journals. 3 A Bibliometric Analysis of the Impact of HRC-funded publications, 1997-2001, Health Research Council of New Zealand, 2007. Available on the HRC website http://www.hrc.govt.nz. ISBN 978-0-908700-87-3.


Impact Indicator & Baseline Performance

5-yr Target 2016

Bibliometric survey shows HRC-funded research publications exceed the world average for citations (baseline 2007 survey: HRC 6.08 citations per publication versus world average 5.83).

Exceeds world

average.

Bibliometric survey shows HRC-funded publications are cited at a greater rate than those supported from other sources in NZ (Baseline 2007 survey: average citation rate for HRC-funded publications 55% and 26% higher than that of health research publications supported by NZ universities and non-HRC investment, respectively).

25% higher than the

average for all other NZ

health research funders.

Support best people and best ideas If our peer-review process is accurately identifying research good enough to have an international impact, then HRC-funded research will be cited in the international literature at a rate that is at least equivalent to the world average, and better than other NZ health research. We also need to ensure that we maintain our investment in significant programmes of research, that often produce high-impact findings and involve international collaborations.

Ensure at least 50% of research investment is in longer term Programme contracts (baseline: 50%).

50%

Support for promising early career researchers We need to invest in top researchers, early in their careers. We will maintain current levels of investment until funding is available to increase the number of awards.

Recipients remain active in health research after completion of Hercus Fellowship (baseline: new measure).

>80%

International research collaborations promoted, facilitated and supported The survey of publications is also an excellent way of tracking international collaborations that have arisen as a result of HRC-funded research.

Bibliometric survey shows that at least one third of HRC-funded publications involve international collaborations (baseline 2007 survey: >30%).

33%


Outcome 3: We Maximise the Benefits of Our Health Research

Why is this important? Health research only benefits New Zealanders if the findings are valued, taken up and used. The quality of research findings must be assured, and knowledge must be transferred to those who can translate the knowledge into new products or services, or used for policy formulation.


We need to facilitate and promote the uptake of research findings …

Over the next 2-3 years, HRC plans to increase the availability of health research findings, by promoting data sharing and by developing an on-line interactive research findings database. We will continue regular dissemination of research highlights that occurs through our regular online and print publications.

… increase engagement of end-users in research …

We will grow partnering with health research end-users through the HRC’s Partnership Programme (see page 22). By partnering with end-users, such as clinicians, planning managers and policy makers, research is more likely to address issues of relevance to their needs, and the findings are more likely to be understood, taken up and applied. Additionally, funding and ‘in-kind’ support available for applied, end user-driven research is maximised, enabling, larger, more meaningful research projects that individual partners could not support alone.

How will we measure if we have been successful? The key indicators under this outcome relate to national dissemination of findings and the expansion of the HRC’s partnering activities.

Impact Indicator & Baseline

Performance 5-yr Target

2016

Uptake of research findings facilitated and promoted Greater ease of access to research findings will support uptake and application by the health sector.

Goal: Development of a searchable, on-line database of key research findings from HRC contracts (new action, indicators to be developed on achievement of goal).

Database developed &

widely promoted to stakeholders.

Engagement of end-users in research Greater end-user engagement with research, including those decision-makers involved in service-planning and delivery, will enhance utility and uptake of research findings.

Percentage of research contracts that have clear end-user involvement (baseline: new measure).

20%


Outcome 4: The Health Research Environment is Ethical, Responsive and Compliant

Why is this important? One of the core activities of the HRC is to champion the integrity of the New Zealand health research environment. The HRC advises the Minister of Health on the safety and merit of research involving gene technologies, accredits all health and disability ethics committees in New Zealand and provides independent data monitoring of large-scale clinical trials, to safeguard participants.


We need to provide expert opinion and timely advice …

The HRC will ensure that appropriate expertise is engaged to deliver high quality advice and review in relation to ethics of health research, safety and monitoring of clinical trials and trials involving gene technology.

... and ensure that our own investment processes are responsive to Māori and culturally appropriate for all research participants.

The relationship with Maori is a unique and valuable feature of health research in New Zealand. To ensure that the particular expertise and knowledge of Maori is captured, There is an obligation, and considerable benefit for the health of New Zealanders, to use processes that ensure that health research is culturally appropriate, particularly for Maori and Pacific peoples, and addresses the needs of those people. We will continue to provide guidelines and support to applicants in making their research more responsive to end-users and tailoring their communication strategies to be appropriate for the stakeholder that they are addressing.

How will we measure if we have been successful? We have not set indicators and targets for our five-year framework under this outcome. Our work in this area is not strategic, but core to our functioning as a relevant and responsible health research purchasing agency.


Managing Organisational Health and Capability

Governance and Committees The HRC has a ten-member Board appointed by the Minister of Health (see page 36) with a range of expertise defined by the HRC Act 1990. Members of the Board chair each of the HRC’s four Statutory Committees (the Biomedical Research Committee, Māori Health Committee, Public Health Research Committee and Ethics Committee) and three of the Standing Committees. The HRC has five Standing Committees: the Pacific Health Research Committee, the Grant Approval Committee, the Risk Management Committee, the Standing Committee on Therapeutic Trials (SCOTT) and the Gene Technology Advisory Committee (GTAC). During 2009/2010 the HRC established a new Standing Committee, the Long Range Strategic Advice Committee (LSAC). While research that meets the short term needs of the health sector is often obvious and communicated to HRC by various partnering organisations, the longer term needs are less apparent. LSAC was established to provide advice to the Board about how research investment should be shaped in relation to health sector needs 10-15 years out. The HRC’s committees provide advice and recommendations on HRC policies and procedures and play a major role in the peer-review processes used to assess research proposals and applications for career development awards.

HRC Secretariat A strength of the HRC continues to be its highly skilled Secretariat staff, many of whom have post-graduate qualifications and research experience. This provides credibility with research providers and helps HRC shape, in a practical way, its investment processes and policy development. The organisation is committed to enhancing and making best use of the skills and strengths available, engaging Secretariat staff in achieving organisational goals. The HRC will continue to use a transparent and impartial employment process to guarantee that there is no barrier to employing the best people for the job, and offer flexible working practices to attract and retain a quality workforce. The HRC is focused on acting with high standards of integrity, ensuring all outcomes are perceived as being fair, impartial, responsible and trustworthy. We employ a comprehensive induction process, and organisational policies and procedures in order that all staff meet and deliver on the State Services Commission Standards of Integrity and Code of Conduct. The Secretariat works closely with both the Board and the HRC’s statutory and standing committees. Relationships between the Secretariat, MoH, MoRST and other funding and investment agents are important. The Chief Executive and members of the management team participate in regular and productive meetings with MoH and MoRST at which matters germane to the health research environment are discussed. The Chief Executive participates in regular Funding and Investment Agent meetings, which include representatives from the Royal Society of New Zealand and the Foundation for Research, Science and Technology, hosted by MoRST.


Reporting/Information for Owners/Funders

No surprises from the Council In addition to the specific reporting requirements indicated elsewhere in the Statement of Intent, the Council will to the extent practicable, ensure that the Minister is adequately warned in advance about any issue affecting the Council that is likely to attract external attention or represent potential risk to the Government.

Annual reports Annual Report – as per the Crown Entities Act 2004 requirements.

Statement of Intent – as per the Crown Entities Act 2004 requirements.

Investment Impact Report – provided to MoRST and MoH, the purpose of which is to demonstrate the effectiveness of the investment made by the Council, and to provide advice on the future effectiveness of these investments.

RS&T scorecard provided to MoRST, for the purpose of monitoring the performance of vote RS&T investments. Data on more than 70 components is provided.

Six-monthly reports

Exceptions-based, 6-monthly reports against this Statement of Intent and Output Agreements with the Ministry of Research Science and Technology.

Exceptions-based, quarterly reports against this Statement of Intent and Output Agreements with the Ministry of Health.


Part 2: Statement of Service Performance

The links between HRC’s outputs and our funding streams are shown in the table below.

HRC Output Funding Sources Vote Output Expense

1. Health Research Contracts

Vote RS&T Bequests & donations Cost-sharing

arrangements Interest

Health & Society Vision Mātauranga Capability Fund

2. Career Development Contracts

Vote RS&T Interest

Health & Society

3. Co-funding Relationships a) Partnership Programme b) International

collaborations

Vote RS&T Third-party

management fees Interest

a) Health & Society b) International

Relationships

4. Contribution to Policy, Regulatory & Ethical Frameworks

Vote Health Vote Health


Output 1: Health Research Contracts

Scope of the Output The HRC invests in health research contracts through annual contestable funding rounds and co-funding partnerships. This output covers research contracted through annual funding rounds. In the period ending December 2009, there were 214 active health research contracts, some of which had been initiated up to three years previously.

Annual Funding Round The annual funding round is our major opportunity for investigator initiated research proposals. Ensuring that research proposal assessment and contracting is equitable, free from conflict of interest and identifies the best ideas is a major part of the work of the HRC. The process of assessment, leading to funding decisions, takes about 6 months in total and will involve approximately 240 expert committee members and a further 450-500 specialist reviewers. The HRC will support four different types of contract through the annual funding round: Projects (up to 3-years duration, $1.2 million maximum), Programmes (5-years duration, $5 million maximum), Feasibility Studies (1-year duration, $150,000 maximum) and Emerging Researcher First Grants (3-years duration, $150,000 maximum). All new contracts will be selected using our international best practice method of peer review and be subject to monitoring to ensure delivery of contracted outcomes. In 2010/11, HRC expects to support 20-25 new Projects, 3-4 new Programmes, 6-7 new Feasibility Studies and 10 new Emerging Research First Grants, in addition to the research contracts still current from previous years. Historically, a one-stage application process was used, with applicants spending considerable time preparing detailed research proposals. Greater than 80% of proposals, however, did not receive funding. In order to help reduce the transaction costs for researchers, in 2009 the HRC moved to a two-stage process that requires researchers to submit a brief Expression of Interest (EoI) before investing a lot of time and effort in developing a full application. The EoIs are assessed by committees of experts and only if the EoI is accepted do they then go on to prepare a full application. The number of EoIs invited to full application is regulated such that the success rate at full application will be about 50%. This approach considerably reduces transaction costs for research organisations and most applicants. Furthermore, the HRC has fewer full applications to process and review, reducing the pressure on expert peer-reviewers.

Cost 2010/11 $ Million Budget revenue: Refer to Financial Statements Note 6: $72.87M Contestable funding round: $76.88M Deficit funded from reserves $4.01M


Another major change to this output has been the introduction of Research Investment Streams. These represent newly defined broad priority areas for HRC’s research investment, and reflect our drive to deliver greater value for money by ensuring that investment targets areas of greatest research need. The four Research Investment Streams, and the indicative proportion of new investment, are:

o Research for New Zealand Health Delivery, 20%. Research will impact on the health system and service delivery in the short term, to contribute to services being delivered more effectively.

o Rangahau Hauora Māori, 5%. The Stream will support Māori health research improving Māori health outcomes, and quality of life.

o Health and Wellbeing, 35-40%. Research funded through this stream will contribute to health and wellbeing throughout the life course. The stream recognises that enhancing health and wellbeing is the best long-term strategy to reduce demand on the health system. The scope includes, but is not limited to, reproductive health, health promotion, mental health and wellbeing, injury prevention, infectious disease, disability research and research on social, cultural and environmental factors influencing health.

o Improving Outcomes for Acute and Chronic Conditions, 35-40%. Research supported in this Stream will contribute to the understanding, prevention, diagnosis and management of non-communicable conditions.

Ngā Kanohi Kitea HRC will support iwi, hapu and Māori community groups to address community-identified health needs through a specific funding opportunity. Funding will be derived from the Vision Mātauranga Capability Fund. An important component of the scheme will be the development of capacity to engage in research.

Alignment with HRC's Outcome Framework Health research contracted through this output delivers to the following outcomes:

Outcome 1: Health research addresses New Zealand's needs, and

Outcome 2: Research contributes to international advances. The key impacts that the HRC expect to achieve through this investment are listed with the performance indicators through which we will measure our success.

Performance Indicators The key performance indicators for this output relate to the quality of the science that is needed to underpin health benefits, innovation, and the relevance of the research investment to New Zealand. We need to focus on both excellence and need. We will use indicators that are internationally accepted as surrogate markers of research excellence – publication of findings in peer-reviewed, indexed research journals and participation in international conferences. Given that the cost of research contracts has increased faster than increases in funding in recent years, and therefore the total number of contracts has reduced, maintaining the level of some indicators is considered an appropriate target, although we expect greater performance in several areas as a result of changes to investment priorities.


Impacts Indicator Standard 2010/11

Percentage of final reports on research contracts assessed as satisfactory or better (baseline 90%)

90%

Number of peer-reviewed publications reported by contract holders per annum (baseline: 473 publications)

450

Support for best people & best ideas (Outcome 1)

Number of invited or keynote presentations at national or international conferences reported by contract holders per annum (baseline: 312)

300

Patents registered as pending, awarded or PCT4 phases (baseline: 17 per annum)

20 per annum

Development of health technology & innovations (Outcome 1) Number of research contracts meeting translational

research criteria per annum (baseline: 8) 12 per annum

Research addresses health priorities (Outcome 1)

Number of current research projects that respond to the priorities and needs identified in HRC's Māori Health Research Strategy; He Korowai Oranga; and Vision Māturanga (baseline: 50)

50

4 Patent Corporation Treaty


Output 2: Career Development Contracts

Scope of the Output The HRC will offer a programme of career development awards, each aimed at addressing a gap in the health research workforce and building vital capacity. In the period ending December 2009, there were 130 active career development contracts, some of which had been initiated up to four years previously. Around 30 awards will be offered in the areas of Maori, Pacific and clinical health research, and disability research, to support a mixture of Masters, PhD and post-doctoral researchers. In addition, about 45 summer studentships will be supported, for undergraduate students wishing to experience health research as a potential career option. Finally, three prestigious Sir Charles Hercus Health Research Fellowships will be offered. These Fellowships aim to build future capability to conduct world-class research in New Zealand. These advanced post-doctoral fellowships support an outstanding emerging researcher (4-8 years post PhD) who wishes to establish a career in health research in New Zealand – this includes those returning to New Zealand from overseas. All career development awards are chosen on the basis of expert review of the proposed research and the potential and record of the applicant.

Alignment with HRC's Outcome Framework Career development contracts awarded through this output deliver to the following outcomes:

Outcome 1: Health research addresses New Zealand's needs, and

Outcome 2: Research contributes to international advances. The key impacts that the HRC expect to achieve through this investment are listed with the performance indicators through which we will measure our success.

Performance Indicators The progress of all career development awardees is monitored through review of annual reports. Satisfactory progress reflects several factors including an effective awardee selection process, good recipient performance and an appropriately supportive training environment.

Cost 2010/11 $ Million Budget revenue: Refer to Financial Statements Note 6 $5.98M Budget Cost $6.10M Deficit funded from reserves $0.12M



Research addresses health priorities (Outcome 1)

Percentage of annual reports on career development awards contracts assessed as satisfactory or better (baseline 90%)

90%


Output 3: Co-Funding Relationships

Scope of the Output Through research co-funding relationships, the HRC can maximise the investment in health research. By using Vote RS&T funding to leverage additional investment from other agencies (both public and private sector), not only can more significant pieces of research be funded than the individual agencies alone could support, but there is increased coordination of research across agencies. Additionally, co-funding is a useful tool to promote the “ownership” of health research outcomes by other agencies, thereby increasing the likelihood that there will be transfer of research knowledge and translation into tangible policy of practice change. The HRC invests in co-funding relationships through the Partnership Programme and the International Relationships Fund. In 2010/11 HRC and partners will support research in areas as diverse as tobacco control, oral health, prostate cancer, clinical trials (collaboratively with Australia) and cardiovascular disease (collaboratively with A*STAR in Singapore).

The Partnership Programme The HRC established the Partnership Programme in 2000 to deliver research that more effectively meets the knowledge needs of policy-makers, planners and those involved in healthcare delivery. In addition, the HRC has used this model as a means of leveraging funding, making it possible to commission larger, more significant pieces of research than each funding partner alone could afford to support. Through the programme, the HRC partners directly with stakeholders to commission research that is needed for the purposes of planning or policy. Since the inception of the programme, the HRC has entered into funding agreements with a wide range of partners - both government and non-government agencies. Use of the HRC’s expertise and processes for commissioning research is a prerequisite in all funding agreements. We also commission health research on behalf of other funders who wish to take advantage of these processes, but do not require co-funding from the HRC.

International Relationships Fund The HRC will support international research collaborations that leverage gains for New Zealand from access to overseas funding streams, expertise or equipment that is not available here. Allocation of funds is contestable and subject to HRC’s standard peer review processes.

Cost 2010/11 $ Million Budget revenue: Refer to Financial Statements Note 6 $5.84M Budget Cost $5.96M Deficit funded from reserves $0.12M


Alignment with HRC’s Outcome Framework Health research contracts awarded through this output deliver to the following outcomes:

Outcome 1: Health research addresses New Zealand's needs;

Outcome 2: Research contributes to international advances, and

Outcome 3: Benefits of health research are maximised. The key impacts that the HRC expect to achieve through this investment are listed with the performance indicators through which we will measure our success.

Performance Indicators Of all of the HRC’s initiatives, the Partnership Programme is most likely to be affected by financial constraints resulting from an economic downturn, as partners have less investment for research; consequently, standards of performance for 2010/11 are set lower than the 2010 baseline.


Engagement of end-users in research (Outcome 3)

Number of Partners involved in co-funding research with HRC Partnership Programme funding agreements (baseline: 17)

15

Uptake of research findings facilitated & promoted (Outcome 3)

Percentage of completed Partnership Programme contracts that have a direct policy impact (baseline: 100)

100%

International collaborations promoted (Outcome 2)

Percentage of completed international collaborative contracts that identify benefit to NZ, e.g. upskilling, access to resources unavailable here, etc. (baseline: 100%)

100%


Output 4: Contribution to Policy, Regulatory and Ethical Frameworks

Scope of the Output Under this output, the HRC undertakes regulatory activities and safety monitoring, and provides strategic advice on health research issues. These activities are provided primarily through the work of several HRC committees, which are listed below with their key functions. HRC Ethics Committee: Provides independent ethical advice on health research of

national importance or great complexity, accredits all health and disability and institutional ethics committees in New Zealand, provides second opinions on disputed decisions for research involving human participants and on the ethics of introducing innovative practices, and produces guidelines on ethical research conduct. The Ethics Committee also administers the Data Monitoring Core Committee.

Data Monitoring Core Committee (DMCC): provides objective, independent monitoring of clinical trials in New Zealand. Primarily, large-scale clinical trials initiated by New Zealand researchers relating to life-threatening diseases, or diseases which cause irreversible morbidity or where there are special concerns regarding patient safety, where the study investigators are inexperienced, or where study integrity could be enhanced by the independence of the DMCC.

Gene Technology Advisory Committee (GTAC): Assesses the scientific merit of New Zealand applications to produce new medical therapies through the transfer of genes from another species to humans, and between species. If necessary, GTAC will advise the Minister of Health that such trials should not be allowed to proceed.

Standing Committee on Therapeutic Trials (SCOTT): When requested by the HRC Board, SCOTT will assess whether or not the proposed clinical trial of a medicine will provide clinically and scientifically useful information, particularly in relation to the safety and efficacy of the agent.

Part of the HRC’s contribution to an ethical health research environment is ensuring that health research in New Zealand is conducted in a way that is culturally appropriate and responsive to the needs of our diverse population. To this end the HRC provides guidelines on the conduct of Māori health research and Pacific health research and requires that applicants formally address responsiveness to Māori in research proposals.

Cost 2010/11 $ Million Budget revenue, Vote Health: $0.29M

Budget Cost $0.40M

Deficit funded from reserve $0.11M


Alignment with HRC Outcomes Framework Health research contracts awarded through this output deliver to the following outcomes:

Outcome 4: Health research environment is ethical, responsive and compliant. The key impacts that the HRC expect to achieve through this investment are listed with the performance indicators through which we will measure our success.

Performance Indicators It is difficult to place performance indicators and standards around the work of these HRC committees, which operate on an ‘as-required’ basis to provide expert advice. Instead we have concentrated on placing indicators around the way that we communicate the ethics information, promote responsiveness to Māori and respond to ministries.


High-quality ethical consideration (Outcome 4)

Regular publication of ‘Ethics Notes’ to inform researchers of issues on ethics in health research (baseline: 3 editions annually)

3 editions annually

Responsiveness to specific groups (Outcome 4)

Proportion of applications that adequately address the HRC’s responsiveness to Māori criteria (baseline: 80%)

90%

Compliance to regulatory requirements (Outcome 4)

Convene Ethics Committee, DMCC, SCOTT and GTAC as required

Convened & provide timely

advice as needed


Financial Statements

Statement of Accounting Policies

For the period ended 30 June 2011

Reporting Entity

These prospective financial statements have been prepared in accordance with Section 38 of the Health Research Council Act 1990, Section 41 of the Public Finance Act 1989, Section 138 of the Crown Entities Act 2004 and are consistent with generally accepted accounting practices.

The financial reporting standard regulating Prospective Financial Statements (FRS-42) requires such statements to be prepared in accordance with the accounting policies expected to be used in the future for reporting historical general purpose financial statements.

From 1 July 2007 the New Zealand equivalent to the International Financial Reporting Standards (NZIFRS) have been applied in the preparation of general purpose financial statements. NZIFRS has been applied in preparing these prospective financial statements.

Accounting policies

The following are the particular accounting policies, which have a material effect on the measurement of results and financial position.

Measurement system

The measurement base used is historic cost.

The cost of producing outputs is recognised on the basis that contract costs will be recognised in the period in which expenditure is expected.

Revenue

All revenue is recognised when it is due and is reported in the financial period to which it relates.

Accounts receivable

Accounts receivable are stated at expected realisable value.

Deposits

Investments are stated at the lower of cost or net realisable value. Any decreases are recognised in the statement of financial performance.


Financial instruments

The Health Research Council is party to financial instruments as part of its normal operation. These financial instruments include bank accounts, short-term deposits, debtors and creditors.

Fixed Assets

All assets are stated at cost less accumulated depreciation.

Depreciation

Depreciation on fixed assets is based on a straight line basis at rates calculated to allocate the cost of the assets over their estimated useful lives. The useful lives adopted are:

Office and computer equipment 3 to 5 years Leasehold improvements Over term of lease

Goods and Services Tax

All items in the financial statements are exclusive of GST, with the exception of accounts receivable and accounts payable which are stated with GST included. Where GST is irrecoverable as an input tax, it is recognised as part of the related asset or expense.

Taxation

In terms of the Health Research Council Act 1990 the income of the HRC is exempt from income tax.

Operating leases

Leases where the lessor effectively retains substantially all the risks and benefits of ownership of the leased items are classified as operating leases. Payments under these leases are recognised as expenses in the periods in which they are incurred. HRC leases office premises.

Statement of cash flows

Cash means cash balances on hand, held in bank accounts, demand deposits and other highly liquid investments in which HRC invests as part of its day-to-day cash management.

Operating activities include cash received from all income sources of the HRC and records the cash payments made for the supply of goods and services.

Investing activities are those activities relating to the acquisition and disposal of non-current assets.

Financing activities comprise the change in equity and debt capital of the HRC.


Cost allocation policy

Direct costs are charged directly to significant activities. All indirect costs are allocated to Outputs.

Employee Entitlements

Provision is made in respect of HRC’s liability for annual, long service and retirement leave.

Changes in Accounting Policies

There have been no changes in accounting policies. Policies have been applied on a basis consistent with those used in previous years.


Statement of Financial Position

As at 30 June 2010

Projected $(Million)

As at 30 June 2010 Expected

$ (Million)

Notes As at 30 June 2011 Projected $(Million)

As at 30 June 2012 Projected $(Million)

As at 30 June 2013 Projected $(Million)

Current Assets

0.10 10.33 Bank and short-term Investments

10.91 13.00 9.03

14.48 11.57 Accounts Receivable 6.57 0.57 0.57 14.58 21.90 17.48 13.57 9.60

Less Current Liabilities 3.04 3.52 Accounts payable 3.48 3.73 3.73

11.54 18.38 Working Capital 14.00 9.84 5.87

0.09 .08 Fixed Assets 0.10 0.09 0.11

Agency Funds

16.81 20.03 Funds held for agents 1 15.03 10.03 5.03 (16.81) (20.03) Less Funds owing to agents (15.03) (10.03) (5.03)

$11.63M $18.46M Net Assets $14.10M $9.93M $5.98M

$11.63M $18.46M Equity 2 $14.10M $9.93M $5.98M


Statement of Financial Performance 12 months to 30 June 2010


As at 30 June 2010 Expected

$ (Million)

Notes 12 months to 30 June 2011


12 months to 30 June 2012




Revenue

82.28 82.24 Vote Research, Science and Technology

3 83.54 82.02 82.02

0.29 0.29 Vote Health 4 0.29 0.29 0.29 0.26 0.75 Interest 0.50 0.10 0.10

0.34 0.79 Other 5 0.65 0.45 0.45

83.17 84.07 Total Revenue 6 84.98 82.86 82.86

87.13 83.57 Cost of Services 7 89.34 87.03 86.81

(3.96) 0.50 Operating (Deficit) (4.36) (4.17) (3.95)

15.59 17.96 Balance Brought Forward 18.46 14.10 9.93

$11.63M $18.46M Transfer to equity 2 $14.10M $9.93M $5.98M


Statement of Cash Flows 12 months to 30 June 2010

Projected (SoI) $ (Million)


Expected $ (Million)







Cash Flows from Operating Activities Cash was Provided from:

80.57 83.30 Government Grants 88.83 88.31 82.31 0.26 0.75 Interest 0.50 0.10 0.10

0.69 0.79 Other Income 0.65 0.45 0.45 $81.52M $84.84M Total $89.98M $88.86M $82.86M

Cash was Applied to:

87.43 83.52 Supply of Outputs 89.33 86.69 86.75

($5.91M) 1.32 Net Cash Flows from Operating Activities (Deficit)

0.65 2.17 (3.89)

Cash Flows from Investing Activities Cash was Applied to:

0.05 0.05 Fixed Assets Purchased 0.07 0.08 0.08

($5.96M) $1.27M Net Cash Movement $0.58M $2.09M ($3.97M)

($5.96M) $1.27M Net (Decrease) Increase Cash Held $0.58M $2.09M ($3.97M) $6.06M $9.06M Add opening cash brought forward $10.33M $10.91M $13.00M $0.10M $10.33M Ending cash carried forward $10.91M $13.00M $9.03M


Notes to Financial Statements 1 The HRC receives and manages funds on behalf of parties involved in jointly funded research projects (Agency funds). These funds are

often transferred to the HRC before appropriate research investments can be established.

2 In the period 2010/2011 – 2012/2013 HRC will manage expenditure by varying the number and size of research contracts to progressively reduce equity to $5.28M.

3 Revenue from Vote Research Science and Technology is derived from the following appropriations.


Projected (SoI)

$ (Million)



12 months to 30 June 2011 Projected $(Million)





3.19 3.19 Research Contract Management 3.19 3.19 3.19

70.95 70.96 Health Research - - - - - Health and Society 76.63 76.63 76.63 5.09 5.04 Career Development Awards - - - 1.98 1.98 Maori Knowledge & Development - - -

Vision Matauranga Capability Fund 1.98 1.98 1.98 1.07 1.07 International Investment Opportunities - - -

International Relationships 1.74 0.22 0.22 $82.28M $82.24M Total $83.54M $82.02M $82.02M

4 Revenue from Vote Health is applied to Output Research Support Activities. 5 Revenue other: HRC expects to receive income from the following during 2010/11: Bequests $0.05M, Partnership Management Fee $0.60M.


6 In 2010/11 revenues streams are applied Outputs as follows:

Health Research Contracts

Career Development

Awards

Co-Funding Relationships

Contribution to Policy

Regulatory & Ethical

Frameworks

Total

Research Contract Management 2.76 0.23 0.20 3.19 Health and Society 69.61 5.72 3.27 78.60 International Relationships 1.74 1.74 Contribution to Policy Regulatory & Ethical Frameworks

0.29 0.29

Other income 0.50 0.03 0.63 1.16 $72.87M $5.98M $5.84M $0.29M $84.98M

7 Cost of services


Projected $ (Million)








4.70 4.00 Research Contract Management - - - 71.28 69.19 Health Research - - -

- - Health Research Contracts 76.88 75.90 76.05 5.74 4.90 Career Development Contracts 6.10 6.35 6.45 2.71 2.71 Maori Health Research - - - - - Co-Funding Relationships 5.96 4.37 3.90 2.66 2.38 International Investment Opportunities - - -

0.39 0.39 Contribution to policy, regulatory and ethical frameworks 0.40 0.41 0.41

$87.48M $83.57M Total $89.34M $87.03M $86.81M Research Contract Management is funded from Vote Research Science and Technology appropriation, other income and funding carried forward.


8 Significant Administration Costs


Projected $ (Million)








2.85 2.85 Staff costs 2.90 2.96 3.02 0.32 0.30 Property costs 0.31 0.35 0.35 1.05 1.04 Meetings including Board 1.06 1.08 1.10 0.35 0.35 Audit fees 0.40 0.42 0.45 0.50 0.53 Depreciation 0.52 0.80 0.57

Administration costs are apportioned across all outputs


Committed Funds

Research Commitments At 30 June 2010 research contract commitments will value between $170m and $180M. Lease commitments will total $0.52M. The commitments are spread as follows:






Research Contracts $80M to $85M $60M to $70M $40M to $50M Lease Commitments $0.21M $0.10M

The committed support is contingent on continued Government funding.


Acquisition of Shares

Before the Health Research Council of New Zealand subscribes for purchases, or otherwise acquires shares in any company or other organisation, it will first obtain the written consent of the Minister of Health. There are no current plans to acquire such shares.

Information on the Organisation

Council membership

The Board of the Health Research Council meets between nine and 11 times per year. Membership of the Board is set out in the Health Research Council Amendment Act 1991, and comprises five persons who are or have been actively engaged in health research, and five persons who have skills and experience in areas such as community affairs, health administration, law or management or knowledge of health issues from a consumer perspective.

(Chair): Mr Robert Stewart ONZM Businessman, Christchurch (Deputy Chair): Professor Richard Beasley CNZM

Director, Medical Research Institute of New Zealand, Wellington

Ms Kath Fox Chief Executive, Richmond New Zealand, Christchurch

Dr Matire Harwood Clinical Director, Tamaki Healthcare, Auckland

Ms Elspeth Ludemann Partner in a pastoral farming business, Oamaru

Professor Richie Poulton Director, Dunedin Multidisciplinary Health and Development Research Unit, University of Otago, Dunedin

Dr Conway Powell Business Consultant, Dunedin Professor Anthony Reeve Director, Cancer Genetics Laboratory,

Department of Biochemistry, University of Otago, Dunedin

Professor Linda Smith Pro-Vice Chancellor Māori, Waikato University, Hamilton

Associate Professor Susan Stott Associate Professor in Paediatric Orthopaedic Surgery, Department of Surgery, University of Auckland, Auckland

Kaumatua Mr Ngarau Tupaea

Rapua te Oranga Hinengaro, Auckland

Chief Executive Dr Robin Olds

Health Research Council of New Zealand

Documents

Health Research Council of New Zealand