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Non-profit InstitutionsSatellite Account

2004

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An economic view of non-profitinstitutions in New Zealand

Statistics New

ZealandNon-profit Institutions Satellite Account

2004

Non-profit Institutions Satellite Account: 2004

CitationStatistics New Zealand (2007), Non-profi t Institutions Satellite Account: 2004,

Statistics New Zealand, Wellington.

Published in 2007 by

Statistics New ZealandTatauranga Aotearoa

Wellington, New Zealand

© Crown Copyright ISBN 0-478-26978-1

Recommended retail price $35.00 (including GST)

iii

PrefaceMany hundreds of thousands of New Zealanders participate in non-profi t institutions or receive services provided by them – often at no cost. Non-profi t institutions are active in areas such as health, sport and recreation, social services, education, culture, emergency response and conservation. These institutions, and the people who are a part of them, have a large impact on New Zealand society as well as on our economy.

Until now New Zealand has had no offi cial way to measure in a consistent framework the quantity and economic value of activities undertaken by non-profi t institutions. As a result, the impact of these groups, and the contribution of their volunteers, has not been clearly visible in New Zealand’s offi cial statistics. A more accurate picture of the size, structure and revenue of non-profi t institutions, including how many there are, how many people they employ, and the level of volunteer input, will help inform debate, research and decision making in government. It is hoped the information will also be of great value to the institutions concerned, enhancing planning and promotional activities.

The Non-profi t Institutions Satellite Account: 2004 is the outcome of an initiative between government, represented by Statistics New Zealand and the Offi ce for the Community and Voluntary Sector, and the non-profi t sector as part of the Study of the New Zealand Non-profi t Sector. The study comprises two inter-related work streams:

● Development by Statistics NZ of the Non-profi t Institutions Satellite Account, as presented in this report. This has involved collecting, assembling and analysing fi nancial and non-fi nancial data on non-profi t institutions and then determining their economic value to the New Zealand economy.

● New Zealand participation in the international comparative study of the non-profi t sector led by the Centre for Civil Society Studies in Johns Hopkins University, Baltimore.

I am grateful for the advice received from the Committee for the Study of the New Zealand Non-profi t Sector and wish to thank Garth Nowland-Foreman, David Robinson, Peter Glensor, Shona Hickey, Peter McIlraith, Robyn Munford, Loudeen Parsons, Bob Stephens, Diana Suggate, Raewyn Good and Tuwhakairiora Williams.

Statistics NZ welcomes feedback on the methods and results presented in this report.

Geoff BascandGovernment Statistician

v

InformationThis report was prepared by Hendrikje Buss, Lucy Husbands, James King, Nedlands Leatua, Brendan Mai, Chase O’Brien, Stuart Payne, Andrew Rae, and Theo Smits of the Macroeconomic Statistics Development unit and published by the Product Development and Publishing Services unit of Statistics New Zealand.

Further informationFor further information on the statistics in this report, and for help fi nding and using statistical information available on our website or in the INFOS computer database, contact our Information Centre:

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Reproduction of materialAny table or other material published in this report may be reproduced and published without further licence, provided that it does not purport to be published under government authority and that acknowledgement is made of this source.

Standards

Percentage changesPercentage movements are, in a number of cases, calculated using data of greater precision than published. This could result in slight variations.

Rounding proceduresOn occasion, fi gures are rounded to the nearest thousand or some other convenient unit. This may result in a total disagreeing slightly with the total of the individual items as shown in tables. Where fi gures are rounded the unit is in general expressed in words below the table headings, but where space does not allow this the unit may be shown as (000) for thousands, etc.

All business counts in this report have been randomly rounded to base 3 or 10 to protect the confi dentiality of respondents. For this reason not all totals will add to that stated.

Changes of baseWhere consecutive fi gures have been compiled on different bases and are not strictly comparable, a footnote is added indicating the nature of the difference.

ValuesAll values shown are in New Zealand currency unless otherwise stated.

Source All data is compiled by Statistics New Zealand, except where otherwise stated. Both administrative and survey data has been used in this report.

Symbols The interpretation of the symbols used throughout this report is as follows:

-- amount too small to be expressed

.. fi gure(s) not available

... not applicable

C confi dential

vii

ContentsPreface .................................................................................................................................................. iii

Information............................................................................................................................................. v

List of tables .......................................................................................................................................... ix

List of fi gures ......................................................................................................................................... xi

List of abbreviations............................................................................................................................... xii

Chapters

1 Introduction………………………………………………………………. .............................................. 1

Why a satellite account? ................................................................................................................. 1

What information does this satellite account contain? .................................................................... 1

Johns Hopkins Comparative Non-Profi t Sector Project ................................................................... 1

Future enhancements ..................................................................................................................... 2

2 Key results…………………………………….…….…….…….………. ............................................... 3

3 Measurement framework……………………………………….……… ............................................... 5

What is a satellite account? ............................................................................................................ 5

What is a non-profi t institution? ...................................................................................................... 5

The two extensions to the NPISA .................................................................................................... 11

New Zealand Standard Classifi cation of Non-profi t Organisations (NZSCNPO) ............................ 12

4 Counting non-profi t institutions…….…………………………………... .............................................. 14

Number of non-profi t institutions ..................................................................................................... 14

Employment numbers ..................................................................................................................... 15

Types of non-profi t institutions ......................................................................................................... 17

5 The Non-profi t Institutions Satellite Account………………………….. .............................................. 18

Contribution to GDP ........................................................................................................................ 18

Components of GDP ....................................................................................................................... 19

Income and expenditure .................................................................................................................. 21

Data sources ................................................................................................................................... 24

Non-profi t institutions in the different sectors of the economy ......................................................... 26

Non-profi t Institutions by industry .................................................................................................... 27

Extending the analysis .................................................................................................................... 28

6 Sources of income ………………………………………………………. ............................................. 29

Defi nitions ........................................................................................................................................ 29

Sales of goods and services ........................................................................................................... 30

Investment income .......................................................................................................................... 31

Transfer income ............................................................................................................................... 31

7 Volunteer labour……………………….……………………….……………… ...................................... 35

Formal unpaid work ......................................................................................................................... 35

Volunteer numbers and hours worked ............................................................................................. 36

Overview of volunteer demographics ............................................................................................. 40

viii

8 Profi les of non-profi t institutions by activity group …………………... .............................................. 43

Culture and recreation ..................................................................................................................... 43

Education and research .................................................................................................................. 49

Health .............................................................................................................................................. 53

Social services ................................................................................................................................ 56

Environment .................................................................................................................................... 58

Development and housing ............................................................................................................... 60

Tangata whenua governance .......................................................................................................... 63

Law, advocacy and politics .............................................................................................................. 64

Grant making, fundraising and voluntarism promotion .................................................................... 66

International ..................................................................................................................................... 68

Religion ........................................................................................................................................... 71

Business and professional associations, unions ............................................................................. 76

Not elsewhere classifi ed .................................................................................................................. 78

9 Technical information ……………………………………………………… .......................................... 81

Defi ning non-profi t institutions ......................................................................................................... 81

Classifi cation of non-profi t institutions (NZSCNPO) ........................................................................ 82

Market and non-market non-profi t institutions ................................................................................. 83

Data sources and methods ............................................................................................................. 84

Counting the number of non-profi t institutions ........................................................................ 84

Counting employment numbers .............................................................................................. 87

Annual Enterprise Survey ....................................................................................................... 87

Religious institutions ............................................................................................................... 87

Estimating the contribution of non-economically signifi cant units ........................................... 88

Calculating and valuing hours of formal unpaid work .............................................................. 88

Terms and defi nitions ...................................................................................................................... 90

National accounting terms and defi nitions ....................................................................................... 92

Detailed tables ................................................................................................................................. 94

Appendices

1 Decision trees: Structural-operational defi nition .............................................................................. 104

2 New Zealand Standard Classifi cation of Non-profi t Organisations (NZSCNPO) ............................ 109

3 Correspondence between NZSCNPO (subgroup level) and ANZSIC96 (subclass level) ............... 112

4 Time Use Survey 1998/99: Purpose of organisation codes ............................................................ 114

References ........................................................................................................................................... 115

ix

Tables 3.01 Determining the scope of the Non-profi t Institutions Satellite Account .................................. 7

3.02 The New Zealand System of National Accounts institutional framework ............................... 10

3.03 The New Zealand System of National Accounts transaction framework ............................... 12

4.01 Number of non-profi t institutions, by activity group, October 2005 ........................................ 14

4.02 Distribution of employees, by number of non-profi t institutions, October 2005 ..................... 16

4.03 Number of employees, by activity group, October 2005 ........................................................ 16

5.01 Non-profi t institutions contribution to GDP, March 2004 year ................................................ 18

5.02 Income and expenditure, total non-profi t institutions, March 2004 year ................................ 21

5.03 Income and expenditure by activity group, March 2004 year ................................................ 22

5.04 Contribution to GDP, by non-profi t institution size, March 2004 year ................................... 25

5.05 Contribution to GDP, by industry breakdown, March 2004 year ............................................ 27

5.06 Extension to SNA-based account: non-market output, March 2004 year .............................. 28

6.01 Non-profi t institution income, by source of income, March 2004 year ................................... 29

6.02 Non-profi t institution investment income, by source of income, March 2004 year ................ 31

6.03 Non-profi t institution transfer income, by institutional sector, March 2004 year .................... 32

6.04 NPI total transfer income including volunteer labour, by institutional sector, March 2004 year .................................................................................................................... 34

7.01 Extension to SNA-based account: unpaid labour, March 2004 year ..................................... 35

7.02 Time use in an average week, productive and non-productive activities, 1999 ..................... 35

7.03 Number of institutions worked for per volunteer, 1999 .......................................................... 36

7.04 Formal unpaid work outside the home, March 2004 year ..................................................... 37

7.05 Value of formal unpaid work, March 2004 year ..................................................................... 38

7.06 Comparison of volunteering for non-profi t institutions, Anglo-Saxon countries ..................... 40

7.07 People who did unpaid work outside the home, four weeks prior to Census night 2006 ...... 41

8.01.01 Culture and recreation non-profi t institutions, key statistics, October 2005 .......................... 44

8.01.02 Culture and recreation subgroups, key statistics, October 2005 .......................................... 45

8.01.03 Culture and recreation non-profi t institutions, by number of employees, October 2005 ........ 46

8.01.04 Culture and recreation non-profi t institutions, income and expenditure, March 2004 year ... 47

8.01.05 Culture and recreation subgroups income and expenditure, March 2004 year ..................... 48

8.01.06 Membership of sports non-profi t institutions, 2001 and 2002 ............................................... 49

8.02.01 Education and research non-profi t institutions, key statistics, October 2005 ........................ 50

8.02.02 Education and research subgroups, key statistics, October 2005 ......................................... 50

8.02.03 Education and research non-profi t institutions, by number of employees, October 2005 ..... 51

8.02.04 Education and research non-profi t institutions, income and expenditure, March 2004 year . 52

8.02.05 Education and research non-profi t institutions subgroups, income and expenditure, March 2004 year .................................................................................................................... 53

8.03.01 Health non-profi t institutions, key statistics, October 2005 ................................................... 54

8.03.02 Health non-profi t institutions, by number of employees, October 2005 ................................. 55

8.03.03 Health non-profi t institutions, income and expenditure, March 2004 year ............................. 55

x

8.04.01 Social services non-profi t institutions, key statistics, October 2005 ..................................... 56

8.04.02 Social services non-profi t institutions, by number of employees, October 2005 ................... 57

8.04.03 Social services non-profi t institutions, income and expenditure, March 2004 year ............... 58

8.05.01 Environment non-profi t institutions, key statistics, October 2005 .......................................... 59

8.05.02 Environment non-profi t institutions, by number of employees, October 2005 ...................... 59

8.05.03 Environment non-profi t institutions, income and expenditure, March 2004 year ................... 60

8.06.01 Development and housing non-profi t institutions, key statistics, October 2005 .................... 61

8.06.02 Development and housing non-profi t institutions, by number of employees, October 2005 ......................................................................................................................... 62

8.06.03 Development and housing non-profi t institutions, income and expenditure, March 2004 year .................................................................................................................... 62

8.06.04 Tangata whenua governance non-profi t institutions, key statistics, March 2004 year .......... 64

8.07.01 Law, advocacy and politics non-profi t institutions, key statistics, October 2005 ................... 65

8.07.02 Law, advocacy and politics non-profi t institutions, by number of employees, October 2005 ......................................................................................................................... 65

8.07.03 Law, advocacy and politics non-profi t institutions, income and expenditure, March 2004 year .................................................................................................................... 66

8.08.01 Grant making, fundraising and voluntarism promotion non-profi t institutions, key statistics, October 2005 ......................................................................................................................... 67

8.08.02 Grant making, fundraising and voluntarism promotion non-profi t institutions, by number of employees, October 2005 ..................................................................................................... 67

8.08.03 Grant making, fundraising and voluntarism promotion non-profi t institutions, income and expenditure, March 2004 year ............................................................................................... 68

8.09.01 International non-profi t institutions, key statistics, October 2005 ......................................... 69

8.09.02 International non-profi t institutions, by number of employees, October 2005 ....................... 69

8.09.03 International income and expenditure, Year ended March 2004 .......................................... 70

8.10.01 Religion non-profi t institutions, key statistics, October 2005 ................................................ 71

8.10.02 Religion non-profi t institutions, by number of employees, October 2005 .............................. 72

8.10.03 Religion non-profi t institutions, income and expenditure, March 2004 year .......................... 73

8.10.04 Religious affi liation, 2006 Census ........................................................................................ 74

8.10.05 Places of worship, by religious affi liation .............................................................................. 75

8.11.01 Business and professional associations non-profi t institutions, key statistics, October 2005 ......................................................................................................................... 76

8.11.02 Business and professional associations, unions non-profi t institutions, by number of employees, October 2005 ..................................................................................................... 77

8.11.03 Business and professional associations, unions non-profi t institutions, income and expenditure, March 2004 year ............................................................................................... 77

8.11.04 Unions and union membership, December .......................................................................... 78

8.12.01 Not elsewhere classifi ed non-profi t institutions, key statistics, October 2005 ....................... 79

8.12.02 Not elsewhere classifi ed non-profi t institutions, income and expenditure, March 2004 year ................................................................................................................... 80

9.01 Non-profi t institutions satellite account and extensions, in summary form, 2004 ................. 86

9.02 Non-profi t institutions satellite account by institutional sector, 2004 ..................................... 96

9.03.1 Non-profi t institutions satellite account, compiled within the SNA framework, production account, 2004 ....................................................................................................................... 97

xi

9.03.2 Culture and recreation subgroups NPISA, compiled within the SNA framework, production account, 2004 ....................................................................................................................... 98

9.03.3 Education and research subgroups NPISA, compiled within the SNA framework, production account, 2004 ....................................................................................................................... 98

9.04.1 Non-profi t institutions satellite account, compiled within the SNA framework, income and outlay account, 2004 ............................................................................................................ 99

9.04.2 Culture and recreation subgroups NPISA, compiled within the SNA framework, income and outlay account, 2004 ..................................................................................................... 100

9.04.3 Education and research subgroups NPISA, compiled within the SNA framework, income and outlay account, 2004 ..................................................................................................... 101

9.05.1 Non-profi t institutions satellite account with extensions, production account, 2004 ............. 102

9.05.2 Non-profi t institutions satellite account with extensions, income and outlay account, 2004 .. 103

Figures

2.01 Contribution of non-profi t institution to GDP, by activity group, 2004..................................... 3

2.02 Number of non-profi t institutions, by activity group, 2005 ...................................................... 4

2.03 Number of employees in non-profi t institutions, by activity group, 2005 ............................... 4

4.01 Number of non-profi t institutions, by activity group, 2005 ...................................................... 14

4.02 Number of employees in non-profi t institutions, by activity group, 2005 ............................... 17

5.01 Value of non-profi t institutions’ contribution to GDP, by activity group, 2004 ......................... 19

5.02 Compensation of employees of non-profi t institutions, by activity group, 2004 ..................... 20

5.03 Source of income for non-profi t institutions, by activity group, 2004 ..................................... 23

5.04 Expenditure for non-profi t institutions, by activity group, 2004 .............................................. 24

5.05 Contribution of non-profi t institutions to GDP, by size of NPI ................................................. 25

6.01 Sources of non-profi t institutions transfer income, by institutional sector .............................. 31

6.02 Non-profi t institutions transfer income, by institutional sector, March 2004 year ................... 32

7.01 Compensation of employees and imputed volunteer wages, by activity group, 2004 ........... 39

7.02 People involved in voluntary work by sex, percentage of age group, 2006 Census ............. 41

7.03 People involved in voluntary work, percentage of ethnic group, 2006 Census ..................... 42

10.1 Structural-operational defi nition: organisation criterion ......................................................... 104

10.2 Structural-operational defi nition: not for profi t criterion .......................................................... 105

10.3 Structural-operational defi nition: institutionally separate from government criterion ............. 106

10.4 Structural-operational defi nition: self-governing criterion ...................................................... 107

10.5 Structural-operational defi nition: non-compulsory criterion ................................................... 107

10.6 Summary of structural-operational defi nition ......................................................................... 108

14 NZSCNPO and Time Use Survey 1998/99 activity group concordance ................................ 114

xii

List of abbreviationsANZSIC Australian and New Zealand Standard Industrial Classifi cation

BERL Business Economic Research Limited

COGS Community Organisation Grants Scheme

DHB district health board

GDP gross domestic product

GST goods and services tax

ICNPO International Classifi cation of Non-Profi t Organizations

ISIC International Standard Industrial Classifi cation

NPISA Non-profi t Institutions Satellite Account

NZAID New Zealand Aid and Development Agency

NZSCNPO New Zealand Standard Classifi cation of Non-Profi t Organisations

NZSNA New Zealand System of National Accounts

PHO primary health organisation

PNZ Philanthropy New Zealand

SNA System of National Accounts

SPARC Sport and Recreation New Zealand

UN United Nations


1

1 Introduction

Why a satellite account?Satellite accounts are recognised internationally as a way of rearranging existing information in the national accounts so that an area of particular economic or social importance, such as non-profi t institutions, can be analysed more closely. Links are maintained between the satellite accounts and the central national accounting framework. This is important as it enables new information to be presented alongside standard economic measures such as gross domestic product (GDP).

The Non-profi t Institutions Satellite Account (NPISA) supplements the existing New Zealand System of National Accounts (NZSNA) and analyses the contribution of non-profi t institutions to the New Zealand economy, as well as including measures of volunteering and unpaid work.

The United Nations (UN) Handbook on Non-Profi t Institutions in the System of National Accounts1 has been used as a guide in compiling the satellite account. The UN handbook recommends statistical standards and guidelines for the development of data on non-profi t institutions. It was prepared as a collaboration between the Johns Hopkins University Center for Civil Society Studies and the Economic Statistics Branch of the United Nations Statistics Division in response to the growing interest in institutions that are referred to as ‘non-profi t’, ‘voluntary’ or ‘non-governmental’ and that are not in a single economic sector under the System of National Accounts.

Several countries have already published non-profi t institutions satellite accounts, for example Australia, Belgium and Canada. As of December 2006, 26 countries are committed to producing non-profi t institutions satellite accounts and implementing the UN handbook.2

What information does this satellite account contain?

The NPISA includes information about non-profi t institutions such as cultural societies, sports clubs, social service institutions, private schools and hospitals, churches, environmental lobby groups, trade unions, political parties and charitable trusts.

The data includes the following fi nancial and non-fi nancial information for the year ending March 2004:

● total income and its components (sales, donations, grants, investment)

● total expenditure and its components (salaries and wages, donations, grants, investment)

● total employment remuneration, including an estimate of the value of formal unpaid labour

● operating surplus and savings

● number of institutions by type (environment, health, social services, etc) as at October 2005

● number of paid employees as at October 2005

● number of volunteers for the year ending March 2004.

The NPISA uses data from two time periods. Financial data was not available beyond the fi nancial year ended March 2004. However, other administrative information relating to the population of non-profi t institutions and their paid employment was available as at October 2005. For purposes of comparison the discontinuity between these two periods is thought to be small.

Johns Hopkins Comparative Nonprofit Sector ProjectThe development of the NPISA is part of a wider international comparative study of the non-profi t sector that New Zealand is participating in. It is being led by the Center for Civil Society Studies at Johns Hopkins University, Baltimore.

The Johns Hopkins University project compares information on the non-profi t sector around the world. Started in 1990, the project now extends to more than 40 countries and involves a common framework for analysis, including information-gathering strategies and a set of defi nitions for determining which institutions

1. United Nations (2003).

2. United Nations Statistical Division (2006).


2

fi t within the project’s scope. The work entails commissioning each country in the project to research the history of the non-profi t sector, the legal and policy environments, and the impact of the sector on society.

A network of national and international advisory committees are used to oversee progress and to help disseminate results. Late in 2004, the Committee for the Study of the New Zealand Non-profi t Sector was established by the Offi ce for the Community and Voluntary Sector to co-manage the input to the Johns Hopkins University project and to advise on the NPISA. The committee is made up of members actively working in the non-profi t sector, independent researchers, academics and representatives from government.

Future enhancementsThe NPISA will be updated on a regular basis, when more recent or improved source data become available. Statistics New Zealand welcomes feedback on the methods and results presented in this report.

Statistics NZ will also begin development on a household satellite account in 2008, which will provide statistics on the contribution of households and informal volunteering to the economy.


3

2 Key results

Contribution to gross domestic product (GDP)For the year ended March 2004, non-profi t institutions contributed $3.64 billion to GDP.3 This was 2.6 percent of New Zealand’s total GDP. GDP is a measure of economic activity and infl ation-adjusted changes in GDP are a measure of economic growth.

The social services group contributed 23 percent of the total GDP of non-profi t institutions.

Figure 2.01

Economic value of voluntary labour in non-profit institutions4 The value of voluntary labour (or formal unpaid work) in non-profi t institutions in New Zealand was estimated to be $3.31 billion for the year ended March 2004. Including this amount in the economic accounts almost doubles the contribution of non-profi t institutions to GDP to $6.95 billion. The addition of formal unpaid work thereby increases the contribution to GDP of non-profi t institutions from 2.6 percent to 4.9 percent.5

Number of volunteersThe number of people who volunteered for one or more non-profi t institutions as at 31 March 2004 is estimated to be 1,011,600.

Number of non-profit institutionsThe number of non-profi t institutions identifi ed as at October 2005 was 97,000. Forty-fi ve percent of these were engaged in arts, cultural, sport or recreation activities.

3 Excluding non-market and volunteer labour extensions. Refer to chapters 5 and 7 for details on these extensions.4 This is one of the two extensions to the account. Refer to chapter 7.5 The economic value of volunteer labour is included in the denominator of this GDP calculation.

Not elsewhere classified

Business and professional associations, unions

Religion

International

Grant making, fundraising and voluntarism promotion

Law, advocacy and politics

Development and housing

Environment

Social services

Health

Education and research

Culture and recreation

0 10 20 30

Activity group

Percent

Contribution of Non-profit Institutions to GDPBy activity group

2004


4

Figure 2.02

Employment numbersNinety percent of non-profi t institutions do not employ paid staff.

The non-profi t institutions identifi ed had a total employment count (of salary and wage earners) of 105,340. These paid employees were employed by only 10 percent of all non-profi t institutions.

Half the total employment count is in just two activity groups, social services (30 percent) and education and research (19 percent).

Figure 2.03



Religion

International




Environment

Social services

Health



0 10 20 30 40 50

Activity group

(000)

Number of Non-profit InstitutionsBy activity group

2005



Religion

International




Environment

Social services

Health



0 10 20 30 40

Activity group

(000)

Number of Employees in Non-profit InstitutionsBy activity group

2005


5

3 Measurement framework

What is a satellite account?The New Zealand System of National Accounts (NZSNA), in line with international standards, covers formal activities in the economy undertaken by business, government, non-profi t institutions and households. However, the standard measurement conventions result in:

1. non-profi t institutions being grouped in different sectors according to their economic role

2. a considerable amount of informal economic activity, such as informal unpaid labour, being omitted from the accounts and hence from key measures such as gross domestic product (GDP).

With regard to (1), the Non-profi t Institutions Satellite Account (NPISA) brings together all non-profi t institutions and analyses the contribution they make to the economy.

With regard to (2), the NPISA aims to provide this missing information, including measuring the value of formal unpaid work. In doing so it extends the production boundary of the NZSNA.

As a result, the NPISA supplements the existing NZSNA.

It is important to note that the intention of the NPISA is not to measure the full range of goods and services that are produced in what is broadly referred to as the ‘non-profi t sector’. This satellite account is confi ned to institutions found within that sector. Individuals, households or groups of people coming together informally to mutually provide services to either themselves or third parties are not included in the NPISA. For this reason, it does not measure the full range of ‘voluntary’ activity occurring in society; it includes only those voluntary activities that take place within non-profi t institutions. To capture the wider range of voluntary activity requires the development of household satellite accounts that would measure all voluntary work, regardless of the particular institutional setting it occurred in.

Moreover, temporary and informal groups such as family gatherings / whänau hui or child-minding groups are viewed as types of (extended) households undertaking production or consumption activities within the household sector. These units – to the extent that they can be identifi ed – may well be the source of great interest, especially as they report collective activities of individuals that could be important for some forms of welfare. However, they are not the subject of the NPISA. Instead, they are better identifi ed and analysed as part of a household satellite account.

What is a non-profit institution?In New Zealand, the majority of goods and services are produced by private enterprises that operate in the market to make a profi t and distribute it to their owners. Government also provides goods and services, usually to the community at large and funded by taxation, to fulfi l its political, regulatory and service delivery roles (such as defence, law and order, and the provision of health and education services).

Outside these market producers and government, further goods and services are produced, principally by way of individuals and households combining together in clubs, societies and other groups. While these institutions may make profi ts (surpluses), they do not have profi t-making as a goal, do not distribute any profi ts to their members and are often reliant on the voluntary provision of free labour and resources to operate successfully. As such, they have been broadly described as non-profi t institutions.

The NPISA looks at those non-profi t institutions that provide goods and services or transfers to households and the community, that are not profi t-oriented, and are operating both voluntarily and independently of government.

The United Nations (UN) Handbook on Non-Profi t Institutions in the System of National Accounts6 proposes a defi nition that brings together those entities that meet fi ve specifi c criteria. Accordingly, for the NPISA non-profi t institutions consist of entities that:

● are organised to the extent that they can be separately identifi ed

● are not for profi t and do not distribute any surplus they may generate to those who control them

6 United Nations (2003) 2.14.


6

● are institutionally separate from government

● are in control of their own destiny

● are non-compulsory in terms of both membership and members’ input.

This defi nition is described as the ‘structural-operational’ defi nition.7

Most institutions – non-profi t or otherwise – are likely to meet some of the criteria. Therefore, if any one criterion is looked at in isolation, an institution may appear to be in scope. For example, public companies meet four of the criteria, but fail to meet the not-for-profi t criterion. Statistics New Zealand, on the other hand, meets the not-for-profi t criterion but is not institutionally separate from government. A neighbourhood watch group is both not-for-profi t and independent of government but it may not have the structure to meet the organisation criterion.

The outcome from applying the defi nition across a range of New Zealand institutions is illustrated in table 3.01. As noted above, to be included in the NPISA a non-profi t institution must meet all fi ve criteria.

7 Refer to chapter 9 – Defi ning non-profi t institutions.


7

Table 3.01

Organisation Not-for-profit Private Self-governing

Non-compulsory In scope

Education / research providersUniversities X XSchool boards of trustees X XParent teacher associationsPrivate schoolsKindergartensPlaycentresKohanga reoIndustry training organisations

Health providersDistrict health boards X XPrimary health organisationsPrivate hospitalsChild health organisations

Welfare organisationsChild support organisationsWomen’s refugesVolunteer fire brigades

International aid organisations

City council-controlled museum trusts X XRepertory theatresBrass bandsLiterary societies

Informal walking groups X XSport and Recreation New Zealand X XRegional sports trustsCricket clubsRacing clubs

Residents’ associationsCommunity law offices

Credit unions X XCommunity and gaming trustsCharitable trusts

Community-based organisationsVeterinary clubsA & P societiesLicensing trusts X X

Tangata whenua-based organisationsRunanga iwi and marae communities

Political partiesPolitical parties

Social clubsRotary and workingmen's clubs

Union, business and professional organisationsTrade unions Business associationsChambers of commerce

Religious congregationsChurch parishes

Determining the Scope of the Non-profit Institutions Satellite Account

Criterion

Advocacy organisations

April 2006

Philanthropic trusts and friendly societies

Social services / emergency providers

International aid organisations

Art and culture organisations

Sports organisations


8

The range of non-profi t institutions that are in-scope is extensive. They include:

● museums, performing arts centres, orchestras, ensembles, historical or literary societies, sports clubs, social clubs

● non-profi t private hospitals, pre-school centres, private schools, social service providers and environmental groups

● religious congregations

● trade unions, business and professional associations, political parties

● advocacy groups that work to promote civil and other rights, or advocate the social and political interests of general or special constituencies

● community-based associations that offer services to or advocate for members of a particular neighbourhood or community

● whänau, hapü and iwi-based organisations that provide governance and/or offer services to or advocate for tangata whenua

● philanthropic trusts, international aid and relief institutions.

Refer to appendix 2 for a more comprehensive list.

As previously mentioned, government-controlled institutions (including universities, school boards of trustees and district health boards) are not included in the NPISA. Also not included, on the grounds that they do not meet the not-for-profi t criterion, are producer boards, cooperatives, trading societies, friendly societies and credit unions. Kindergartens, although classifi ed in terms of their economic role to the government sector in the national accounts, are included in the NPISA as incorporated societies. Other inclusions are racing clubs, community trust boards, industry training organisations and primary health organisations. Full details of inclusions and exclusions can be found in the Statistics New Zealand paper, Identifying Non-profi t Institutions in New Zealand.8

New Zealand System of National Accounts

In New Zealand, the prime quantitative presentation of macro-economic activity is the New Zealand System of National Accounts (NZSNA).

The NZSNA records all types of transactions for both the economy as a whole, and for certain groups or sectors within it. This provides information on economic activities such as:

● the production of goods and services and the costs involved in producing them (refer to the ‘Production’ section of table 3.03)

● the incomes earned by various groups within the economy, and what they do with them (refer to the ‘Production fi nanced by’ and ‘Capital account’ sections of table 3.03).

With this sort of information, answers can be provided to questions such as:

● What is produced and who produces it?

● What inputs are used?

● Who owns the labour, capital and other resources used, and what do they receive in exchange?

● What happens to these incomes when they are received? How much does the government take, how much is consumed, how much is saved and how much is invested?

The NPISA provides answers to these questions for those institutions that come in scope, both as a whole and for some sub-groupings. For non-profi t institutions, additional questions of relevance are:

● What is the redistributional role of non-profi t institutions?

● What is the value of the additional output, if any, provided free by market non-profi t institutions?

● What is the level of the unpaid contribution of volunteers working for non-profi t institutions?

8 Statistics New Zealand (2006).


9

GDP and the concept of value-added

A major objective of national accounts is to measure the value-added resulting from production. The concept of value-added relates to the value that is added to a product or service by capital and labour during its production. If all production was added together, considerable duplication would occur because many goods and services provided by one producer are purchased by another for use in the production of subsequent goods and services. As a result, the value of some goods and services becomes incorporated in the value of other goods and services. One purpose of the national accounting process is to remove the value of these intermediate purchases so as to arrive at a value of production free of duplication.

For individual producers, including non-profi t institutions, total output less intermediate purchases9 measures their value-added and represents a producer’s contribution to GDP. The components of value-added are remuneration of employees (called compensation of employees in the national accounts), taxes on production and the decline in value of fi xed assets used in production, as a result of physical deterioration and normal obsolescence (called ‘consumption of fi xed capital’ in the national accounts).

For those non-profi t institutions that employ paid staff, remuneration of employees is likely to be the largest component of value-added. However, the majority of non-profi t institutions do not employ paid staff (see chapter 4), relying instead on unpaid volunteers. As the contribution of unpaid labour is not measured as part of value-added, conventional GDP understates the full contribution from the employment of unpaid labour, by the amount of unpaid labour.

Market and non-market non-profi t institutions

Distinguishing between market and non-market producers is important since accounts are compiled differently for non-profi t institutions depending on whether they are market or non-market.

A ‘market’ producer is an institution that sells its goods or services at competitive market (or ‘economically signifi cant’) prices. Most non-profi t institutions are classifi ed as ‘non-market’, because they provide their services for free or at below market prices. Their costs of production are mainly fi nanced indirectly by other sources of funds, such as interest, dividends, membership fees, donations or grants, and not directly from sales receipts.

A signifi cant number of non-profi t institutions are market producers however, and are included in the non-profi t institution population as long as they meet the structural-operational defi nition. They may also generate a positive ‘operating surplus’10 by selling their output at market rates. At the same time, they meet the legal requirements of being not-for-profi t because the surplus is either retained within the organisation or distributed to another non-profi t institution or charitable purpose.

In the NPISA, most non-market units are providing services free or at below market rates and therefore are making a ‘loss’. If their output was measured solely on the basis of their sales income, their output (and hence contribution to the economy) would be signifi cantly understated. In many cases, value-added would even be negative. For this reason, the national accounts adopt the convention that the valuation of the output of non-market non-profi t institutions is equal to their costs of production. The output that is not sold is called ‘non-market output provided free’.11 Under this convention, net operating surplus is, by defi nition, zero.

In practice, it is possible for a non-market non-profi t institution to make a surplus. This is recorded as operating surplus, and non-market output provided free is set to zero. This is a relatively rare occurrence.

On the other hand, market units make a positive or negative operating surplus, and conceptually do not have any non-market output provided free. The rationale here is that market units are charging at economically signifi cant prices, so a negative operating surplus represents a loss on operations to the non-profi t institution.

The classifi cation of non-profi t institutions as transactors in the national accounts

From the macro-economic standpoint, the fundamental classifi cation of transactors is by economic role. Such classifi cation defi nes economic units according to ‘institutional sectors’. These are broad economic

9 Or intermediate consumption.10 Refer to chapter 9 – Terms and defi nitions.11 Refer to chapter 9 – Terms and defi nitions.


10

groupings that bring together units that play similar roles in the economy and react similarly to various market prices and/or economic policies. In the national accounts the following institutional units are recognised:

● corporations (including quasi corporations, companies etc) usually set up to make a profi t or operate in the market

● government units

● households, as producers and consumers

● non-profi t institutions, both formal and informal.

Table 3.02

Corporations Government Households Non-profit institutions

Non-financialcorporations

Non-financialcorporations … …

1. Non-financial market NPIs2. NPIs serving business

Financial corporations Financialcorporations … … Financial market NPIs

General government … Government units … NPIs controlled by government units

Non-profit institutions serving households … … … NPIs serving

households

Households … …

1. Households2. Extended households (eg whanau)3. Informal groups

…

Symbol:… not applicable.

Institutional sector

The New Zealand System of National Accounts Institutional FrameworkBy institutional sector

Institutional unit

In the NZSNA, non-profi t institutions can be classifi ed to any of four institutional sectors, resulting in non-profi t institutions being spread across any one of the four non-household sectors they may be classifi ed to. Market non-profi t institutions will be included in the fi nancial and non-fi nancial corporations sectors and non-market non-profi t institutions in the government and non-profi t institutions serving households sectors. In contrast, the NPISA brings them together in a single account as long as each meets all fi ve criteria of the structural-operational defi nition.

In New Zealand, most non-profi t institutions are included in the institutional sector non-profi t institutions serving households, as historically they have not been predominantly involved in the provision of marketed output. In addition, when applying the institutional sector classifi cation, Statistics NZ has placed greater importance on the wider economic role of non-profi t institutions, rather than focusing solely on their production activities. However, this situation is continually changing and with the increasing involvement of non-profi t institutions in providing contracted services subject to open tender, it is expected that more non-profi t institutions will be classifi ed as market and included in the non-fi nancial corporations sector.

Nevertheless, even with the present classifi cations, market non-profi t institutions are economically signifi cant. A presentation of their economic contribution based solely on the national accounts non-profi t institutions serving households sector would tell only part of the story. The NPISA presents the full economic picture of non-profi t institutions, and will do so consistently over time.


11

The two extensions to the NPISAThe fi rst NPISA extension is the imputation for the non-market output of market non-profi t institutions. As noted above, in the national accounts market non-profi t institutions do not produce non-market output, and the services provided to the community by these units are deemed to be fully captured in their sales. In practice this will often not be the case. Market non-profi t institutions, whether making a surplus or a loss, may provide services over and above those they actually charge for. Ideally, these non-market services would be valued in addition to their actual sales. However, the data needed for this method of valuation is not readily available. Instead, following the UN handbook recommendations, this additional non-market output is partially measured by imputing non-market output only for those market non-profi t institutions recording a loss. The convention adopted is to equate their non-market output to their operating loss, which could be considered a minimal value.

The second NPISA extension relates to unpaid voluntary labour. For those non-profi t institutions that employ paid staff, compensation of employees is likely to be the largest component of value-added. However, the majority of non-profi t institutions do not employ paid staff, relying instead on unpaid volunteers. As the contribution of unpaid labour is not measured as part of value-added, conventional GDP excludes the contribution from the employment of unpaid labour. Extending the conventional GDP boundary to include the contribution of unpaid voluntary labour is the second extension.

Unpaid labour

The UN defi nition of voluntary activity or unpaid work is based on three criteria. The work or activity:

● is not undertaken primarily for fi nancial gain

● is undertaken of one’s own free will12

● brings benefi ts to a third party as well as to the people who volunteer.

Unpaid work is split into three broad categories for statistical purposes. Although there are always exceptions around the borders of these defi nitions, the categories are:

1. Informal unpaid work within the home, for example, cooking a meal for an elderly relative in one’s own home.

2. Informal unpaid work outside the home, for example, cooking a meal for an elderly neighbour.

3. Formal unpaid work outside the home for or through an institution, for example, cooking a meal for an elderly neighbour and delivering it as part of a formal institution.

It is this third category, formal unpaid work outside the home for or through an organisation, or formal unpaid work, that is measured as part of the NPISA.

The classifi cation of transactions

The transactions recorded in the NPISA, including the two extensions to the core NZSNA variables described above, are set out in the following table.

12 Cultural obligations around unpaid work can make strict adherence to this point diffi cult. For a more detailed discussion refer to Offi ce of the Community and Voluntary Sector (2007), 8.5.


12

Table 3.03

System of NationalAccounts

Imputed non-market output for

market NPIsVolunteer labour Total

Production accountGross output

Sales of goods and services … …Non-market output provided free

InputsIntermediate consumption … …

Value-addedCompensation of employees …Taxes on production … …Consumption of fixed capital … …Operating surplus …

Income and outlay accountIncomeOperating surplus (brought forward) …Investment income

Interest received … …Dividends received … …

Current transfersDonations received …Government grants … …

OutlaysDonations paid … …Net insurance premiums … …Interest paid … …Non-market output provided free

Savings … …


Transaction

The New Zealand System of National Accounts Transaction Framework

New Zealand Standard Classification of Non-Profit Organisations (NZSCNPO)The classifi cation used to group the non-profi t institutions within the NPISA is the New Zealand Standard Classifi cation of Non-Profi t Organisations (NZSCNPO), which is based on a similar international classifi cation. The NZSCNPO differentiates between various types of non-profi t institutions according to their primary activity.

The NZSCNPO groups together institutions involved in similar activities or serving similar purposes. It comprises 12 major activity groups,13 as follows:

● Culture and recreation

● Education and research

● Health

● Social services

● Environment

13 With the twelfth being a catch-all group, ‘not elsewhere classifi ed’.


13

● Development and housing

● Law, advocacy and politics

● Grant making, fundraising and voluntarism promotion

● International

● Religion

● Business and professional associations, unions

● Not elsewhere classifi ed.

See appendix 2 for a detailed breakdown of the NZSCNPO.

Three principal adaptations of the International Classifi cation of Non-Profi t Organizations (ICNPO) have been made for New Zealand, as follows:

● The fi rst makes provision for early childhood education in the larger education group, refl ecting the signifi cance that non-profi t institutions such as playcentres, kindergartens and kohanga reo play in the New Zealand education system.

● The second adaptation recognises the role that Mäori play in governing tangata whenua outside of central and local government. A new group is made up of tangata whenua governance institutions that manage the affairs of iwi, hapü and marae.

● Third, where appropriate, institutions have been classifi ed as ‘support and ancillary services’ in a new subgroup within each major group, rather than classifi ed as group 12, ‘not elsewhere classifi ed’. This means, for example, that school hostels and parent teacher associations are grouped as support and ancillary services to education, within the main NZSCNPO education group.

Treatment of Mäori in the NZSCNPO

In general, an institution that is affi liated with or run by Mäori will be included in the group that represents its primary activity, for example, marae health centres are included in the health group. The exception is an institution whose primary activity is governance outside of government. These institutions are included in a subgroup that is unique to the New Zealand classifi cation called ‘tangata whenua governance’. See chapter 8 for more details.

Tangata whenua governance includes iwi organisations mandated by whänau and hapü. It includes other institutions with mandate, ownership or management of tangata whenua such as marae committees. Initially only institutions that could be easily identifi ed as marae and those institutions listed in the Maori Fisheries Act 2004 have been included. Statistics NZ recognises that many more institutions exist than have been identifi ed within tangata whenua governance. For this reason separate fi nancial statistics have not been included in the NPISA.


14

4 Counting non-profit institutions

Number of non-profit institutionsThe number of non-profi t institutions identifi ed as at October 2005 was 97,000.

Forty-fi ve percent of non-profi t institutions were engaged in arts, cultural, sport or recreation activities. The next largest groupings were institutions providing social services (12 percent) and religious institutions (10 percent).

Figure 4.01



Religion

International




Environment

Social services

Health



0 10 20 30 40 50

Activity group

(000)


2005

Table 4.01

1 Culture and recreation 43,220 44.62 Education and research 7,400 7.63 Health 2,210 2.34 Social services 11,280 11.65 Environment 1,310 1.46 Development and housing 7,580 7.87 Law, advocacy and politics 2,500 2.68 Grant making, fundraising and voluntarism promotion 610 0.69 International 300 0.310 Religion 9,890 10.211 Business and professional associations, unions 3,130 3.212 Not elsewhere classified 7,560 7.8

Total 97,000 100.0

Note: All count data has been randomly rounded to protect confidentiality. Individual figures may not sum to the totals.


October 2005

Number of NPIs Percentage of all NPIsNon-profit institution activity group


15

The largest groups, and their constituent institutions are:

● Culture and recreation – the largest group, this includes institutions such as fi lm societies, community theatres, toy libraries, historical associations, garden societies, operatic societies, pipe bands, Mäori performing arts groups, sports clubs, regional sports trusts, racing clubs, tramping clubs and vintage car clubs.

● Social services – includes a vast range of social service providers, emergency and relief services and institutions providing income support and maintenance. Examples are early intervention services, services for the disabled and elderly, food banks, self help and other personal social services.

● Religion – includes churches and associations promoting religion or administering religious services. Examples include Bible chapels, churches and temples. Service agencies with religious affi liations, in fi elds such as health, education and social services, are grouped with other relevant service providers rather than being included here.

● Education and research – includes kindergartens, playcentres, kohanga reo, private primary and secondary schools, private tertiary providers, other education providers such as English for speakers of other languages, and research institutions. However, public education institutions such as universities, colleges of education, polytechnics, and state and integrated schools are not included.

● Business and professional associations, unions – includes institutions that promote, regulate and safeguard interests of businesses, professionals and workers, such as trade unions and chambers of commerce.

● Development and housing – includes institutions working towards improving the quality of life within communities or the economy to improve general public well-being. This includes community centres, community development trusts, neighbourhood support groups, employment services, and those tangata whenua governance institutions that manage the affairs of iwi, hapü and marae.

Three sources were used for identifying these non-profi t institutions. These were:

● Statistics New Zealand’s Business Frame (a register of New Zealand businesses)

● The registers of incorporated societies and charitable trusts held by the Companies Offi ce

● Other administrative datasets maintained by Inland Revenue.

Some other non-profi t institutions are not listed in any of these three main registers. To test how many additional non-profi t institutions can be picked up from other sources, a study of a defi ned geographic area, Masterton District, was conducted. An additional 8 percent of non-profi t institutions were identifi ed in this study. While this result needs to be interpreted with caution and cannot be extrapolated to the whole country, it provides a level of confi dence that the large majority of non-profi t institutions are indeed on the three main registers.

Employment numbersThe non-profi t institutions identifi ed had a total paid employment count (that is, the total number of paid employees) of 105,340.

However, 90 percent of non-profi t institutions do not employ staff. As shown in table 4.02, paid employees were employed by only 10 percent of all non-profi t institutions. Employment counts do not distinguish between full- and part-time employment.


16

Table 4.02

Number of employees

0 87,220 89.91–5 6,390 6.66–19 2,450 2.520–99 790 0.8100+ 140 0.1Total 97,000 100.0

Note: All count data has been randomly rounded to protect confidentiality.Individual figures may not sum to the totals.

Distribution of Employees

October 2005

Number of non-profit institutions Percentage of all NPIs

By number of non-profit institutions

Employment counts are much more concentrated by activity than are the number of institutions. Most employment (79 percent) is found in the fi rst four activity groups, with half the total employment count being in just two groups, social services (30 percent) and education and research (19 percent). A further 16 percent of employment was in culture and recreation and 14 percent in health. The next largest group was religion with 9 percent of employment, and the seven remaining groups contributed 12 percent.

Table 4.03

1 Culture and recreation 16,820 16.02 Education and research 20,140 19.13 Health 15,090 14.34 Social services 31,480 29.95 Environment 1,020 1.06 Development and housing 3,730 3.57 Law, advocacy and politics 2,490 2.48 Grant making, fundraising and voluntarism promotion 570 0.59 International 560 0.510 Religion 9,390 8.911 Business and professional associations, unions 3,400 3.212 Not elsewhere classified 640 0.6

Total 105,340 100.0

Note: All count data has been randomly rounded to protect confidentiality. Individual figures may not sum to the totals.

Number of Employees

Number of employees

Percentage of all NPI

employees

By activity groupOctober 2005

Non-profit institution activity group

The employment counts suggest that member-benefi t non-profi t institutions may rely more on unpaid volunteers to deliver their services. With the exception of the culture and recreation group, the institutions in the other three signifi cant groups (social services, education, and health) largely exist to provide services to the general public. In contrast, culture and recreation institutions aim, more generally, to provide services to their own members.


17

Figure 4.02



Religion

International




Environment

Social services

Health



0 10 20 30 40

Activity group

(000)

Number of Employees in Non-profit InstitutionsBy activity group

2005

Types of non-profit institutionsInstitutions registered as either incorporated societies or charitable trusts are prevented under legislation from distributing any surpluses to their members or directors. Traditionally, these institutions are considered to be non-profi t institutions.

The Companies Offi ce provided a list of charitable trusts (15,825) and incorporated societies (21,027) that existed on their register as at the end of September 2005. These numbers may have changed slightly when reconciled with the other registers and duplicates removed. The Statistics New Zealand Business Frame does not distinguish incorporated societies and unincorporated associations. Using the count of incorporated societies from the Companies Offi ce register, the proportion of unincorporated associations counted for this report is estimated to be approximately 61 percent. Of these, 1 percent are other institutions, namely:

● trusts not registered as charitable trusts

● charitable (not-for-profi t) companies.


18

5 The Non-profit Institutions Satellite AccountThis chapter provides an overview of the economic contribution of non-profi t institutions. Data are presented on the contribution to gross domestic product (GDP) (also known as value-added) for all non-profi t institutions, as well as for each activity group. This is further elaborated on by providing international comparisons and comparisons with the total New Zealand economy. The components of GDP are shown, as well as a breakdown of income and expenditure.

Data is presented on a System of National Accounts (SNA) basis in the fi rst instance. Also shown are two extensions to the SNA-based account:

● an extension for the non-market output of market units14

● an extension for unpaid labour.15

Contribution to GDPNon-profi t institutions contribute substantially to the New Zealand economy, as measured by their contribution to GDP. Contribution to GDP is the value-added in the process of producing goods and services.16

GDP attributed to non-profi t institutions amounted to $3.64 billion in 2004 (SNA basis), 2.6 percent of total GDP in New Zealand.

Table 5.01

14 See table 5.0515 Refer to chapter 7.16 Refer to chapter 3 – GDP and the concept of value added.17 Australian Bureau of Statistics (2002), 12.18 Statistics Canada (2006), 9.19 Canada identifi es the core non-profi t sector as excluding public hospitals and universities.

3,640 139,753 2.6

(1) This number has been rounded to the nearest million dollars.

Non-profit Institution Contribution to GDP

Contribution to GDP

Non-profitinstitutions Total NZ economy(1)

Non-profitinstitutionscontribution

(percent)

NPIs contribute 2.6 percent of GDP

$(million)

March 2004 year

Key fact

The contribution of 2.6 percent to total GDP by New Zealand non-profi t institutions is lower than that shown by recent non-profi t institutions data for Australia, at 3.3 percent (2000),17 and the same as Canada, at 2.6 percent (2003).18 No 2004 data is available for the above countries.

The scope of the non-profi t institution data included in the comparisons above is similar, for example public hospitals and universities are excluded from non-profi t institution data for the New Zealand, Australia and the core Canadian non-profi t institution satellite accounts.19 However, even though the scope is similar in principle, the above comparisons may also be affected by how the structural-operational defi nition of non-profi t institutions is adopted in each country, both in theory and in practice.

Of the total non-profi t institution contribution to GDP, the social services group (23 percent) and education and research group (16 percent) are the largest contributors. Given the importance of compensation of employees when measuring the contribution to GDP, these results refl ect the large number of staff employed by these non-profi t institutions.


19

Figure 5.01



Religion

International




Environment

Social services

Health



0 200 400 600 800 1,000

Activity group

$(million)

Value of Non-profit Institutions' Contribution to GDPBy activity group

2004

Components of GDPGDP (or value-added) is defi ned as the sum of total output minus intermediate consumption. The components of value-added are:

● compensation of employees

● taxes on production

● consumption of fi xed capital

● net operating surplus.

Within the Non-profi t Institutions Satellite Account (NPISA), compensation of employees made up $2.61 billion, or 72 percent, of value-added. The contributions of the remaining items were:

● taxes on production: $228 million (6 percent)

● consumption of fi xed capital: $402 million (11 percent)

● net operating surplus: $400 million (11 percent).


20

Figure 5.02

20 The major item in taxes on production is gaming duty paid on gaming machines revenue.21 Refer to table 9.03.1



Religion

International




Environment

Social services

Health



0 200 400 600 800

Activity group

$(million)

Compensation of Employees of Non-profit InstitutionsBy activity group

2004

The largest amount of compensation of employees was made by the social services group ($759 million), followed by education and research ($517 million), then health ($363 million).

The highest contribution of compensation of employees to value-added occurred in the social services group (92 percent). For all other groups, with only one exception, the compensation of employees component made up over 75 percent of value-added.

The exception is the grant making, fundraising and voluntarism promotion group, where compensation of employees contributes less than $16 million (3 percent) to value-added. This group includes gaming trusts, whose principle activities are the operation of gaming machines and the distribution of profi ts arising from these activities. As such, their value-added consists mostly of taxes on production20 (32 percent) and net operating surplus (52 percent).21


21

Income and expenditure

Table 5.02

IncomeSales of goods and services 4,869,708 60.6Interest received 345,971 4.3Dividends received 132,135 1.6Membership, donations and grants(1) 1,905,396 23.7Government grants(2) 758,829 9.4Insurance claims 24,206 0.3

Total income 8,036,245 100.0

ExpenditurePurchases of goods and services 3,479,672 48.7Compensation of employees 2,611,090 36.6Taxes on production 227,676 3.2Donations paid 684,746 9.6Interest payments 96,270 1.3Net insurance premiums 42,691 0.6

Total expenditure 7,142,145 100.0

SurplusIncome minus expenditure 894,100 …

(1) This does not include government grants.(2) Government grants does not include government contracts.

Note: Individual figures may not sum to totals due to rounding.

Symbol:… not applicable

Income and Expenditure

March 2004 yearTotal non-profit institutions

$(000) Percent

More than half the overall income of non-profi t institutions comes from the sale of goods and services. This includes contract payments from the Crown where these have been classifi ed as a sale (see below). It also includes ‘other income’, for example rental income, but excludes non-operating income such as insurance claims, gains on sales or the recovery of bad debts.

Memberships, donations and grants includes transfers of funds from a range of sources, such as households, businesses, and philanthropic and charitable trusts. It includes levies, payments to affi liated institutions such as governing bodies, philanthropic grants and bequests.

The inclusion of memberships is, however, subject to one exception. The membership fees of businesses and individuals acting in a professional capacity, as paid to a professional body or business association, are treated as a purchase of services rather than as a donation.

Government grants include transfer payments from government. These payments had to be assigned to either sales or grants, which was complicated by the sometimes limited detail in the source data. For the NPISA, government transfers to market non-profi t institutions have been recorded as sales, and government transfers to non-market non-profi t institutions have been recorded as grants. The only exception to this rule occurs within health and social services, where most government transfers to non-market non-profi t institutions have been recorded as sales. This is based on specifi c analyses of transfers made to non-profi t institutions in these groups, and where these are more akin to sales or contractual undertakings.


22

Compensation of employees includes salaries and wages, directors’ fees, superannuation and Accident Compensation Corporation payments. It does not include payments to contractors or the purchase of other external labour services.

The largest contribution to taxes on production is from gaming duty and local authority rates.

Table 5.03

1 Culture and recreation 984,000 37,359 3,258 473,951 119,078 6,893 1,624,5392 Education and research 503,404 21,683 3,438 109,359 400,937 3,062 1,041,8833 Health 694,178 11,024 11,122 103,654 30,314 1,323 851,6144 Social services 1,013,297 33,854 6,595 254,032 83,306 3,170 1,394,2555 Environment 124,644 2,580 91 25,798 5,650 187 158,9516 Development and housing 109,408 5,110 925 67,994 68,735 677 252,8497 Law, advocacy and politics 124,816 4,417 1,688 51,615 11,817 308 194,6628 Grant making, fundraising and voluntarism promotion 688,688 147,178 94,204 56,166 4,545 450 991,2329 International 18,528 4,810 406 89,716 11,254 36 124,75010 Religion 145,880 53,620 7,165 534,224 5,435 6,483 752,80811 Business and professional associations, unions 417,920 21,554 3,077 93,643 4,251 1,234 541,67912 Not elsewhere classified 44,943 2,782 166 45,242 13,508 383 107,024Total 4,869,708 345,971 132,135 1,905,396 758,829 24,206 8,036,245

Purchases of goods and services(1)

Interest Compensationof employees

Donations Taxes on production

Netinsurancepremiums

Total

1 Culture and recreation 997,080 20,951 322,836 45,830 26,198 12,158 1,425,0532 Education and research 402,070 10,159 517,438 9,114 3,703 5,400 947,8843 Health 335,689 3,544 362,787 11,536 2,290 2,333 718,1804 Social services 528,356 13,811 758,734 13,091 6,439 5,591 1,326,0235 Environment 110,650 1,147 33,659 2,799 213 329 148,7976 Development and housing 131,054 3,778 93,135 6,578 688 1,194 236,4287 Law, advocacy and politics 88,794 1,463 71,656 2,433 417 544 165,3078 Grant making, fundraising and voluntarism promotion 152,817 12,334 15,624 462,063 181,071 794 824,7039 International 29,708 108 18,695 65,641 57 63 114,27210 Religion 295,546 25,267 246,206 56,142 5,165 11,433 639,75911 Business and professional associations, unions 337,104 1,025 148,398 5,899 1,090 2,177 495,69312 Not elsewhere classified 70,804 2,684 21,922 3,617 345 675 100,046Total 3,479,672 96,270 2,611,090 684,746 227,676 42,691 7,142,145

(1) This is also referred to as intermediate consumption.

Note: Individual figures may not sum to totals due to rounding.

$(000)

Interest Dividends Donations Governmentgrants

Insuranceclaims

Expenditure

$(000)

Income and ExpenditureBy activity groupMarch 2004 year

Non-profit institution activity group

Income

Sales of goods and services

Total

In absolute values, most sales of goods and services were made by the social services group, at $1,013 million (21 percent). Most returns from investment (interest plus dividends) were obtained by the grant making, fundraising and voluntarism promotion group, at $241 million (50 percent). The religion group received more donations than any other group, at $534 million (28 percent), while 53 percent ($401 million) of government grants went to education and research.

On the expenditure side, most purchases of goods and services were made by the culture and recreation group, at $997 million (29 percent). Social services paid the highest amount of any group for remuneration of employees, at $759 million (29 percent), which is consistent with this group having the highest employee count. The largest amount of donations was paid out by grant making, fundraising and voluntarism promotion


23

institutions, at $462 million (67 percent), in line with their predominant activity. These institutions also paid by far the highest amount of taxes on production, at $181 million (80 percent), which was due to the large amount of gaming duty paid.

Figure 5.03

Source of Income for Non-profit InstitutionsBy activity group

2004



Religion

International




Environment

Social services

Health



0 20 40 60 80 100

Activity group

Percent

Sales ofgoods andservices

Memberships,donationsand grants

Governmentgrants

Investmentandinsurance(1)

(1) Does not include government grants.

When analysing the distribution of the different sources of income for each activity group, four groups stand out with regard to sales of goods and services. For the health; social services; environment; and business and professional associations, unions groups; sales of goods and services contributed in excess of 70 percent of their income.

Grant making, fundraising and voluntarism was the only group that received a sizeable proportion of its income as returns on investment – interest and dividends account for 24 percent of income for this group.

For donations received, two groups stand out: religion and international. Over 70 percent of their income was from donations.

Large proportions of income in the form of government grants were received by education and research (38 percent) and development and housing (27 percent).


24

Figure 5.04

Expenditure for Non-profit InstitutionsBy activity group

2004



Religion

International




Environment

Social services

Health



0 20 40 60 80 100

Activity group

Percent

Purchasesof goodsand services

Compensationof employees

Donationspaid

Otherexpenses(1)

(1) Includes taxes on production, interest payments and net insurance premiums.

When analysing the distribution of the different destinations of expenditure for each activity group, culture and recreation, and environment stand out with purchases of goods and services making up more than 70 percent of their expenditure.

Social services (57 percent), education and research (55 percent), and health (51 percent) paid more than half of their expenditure towards compensation of employees.

The largest expenditure item for the grant making, fundraising and voluntarism promotion (56 percent) and international (57 percent) groups is donations, providing funding for non-profi t institutions and charitable purposes within New Zealand and overseas.

Data sourcesThe main data source for fi nancial data is the Annual Enterprise Survey. This survey includes enterprises22 that:

● have greater than $30,000 annual GST expenses or sales

● average a count of greater than two jobs over 12 months (rolling mean employment of greater than two)

● meet some other conditions as applicable.23

22 Refer to chapter 9 – Terms and defi nitions.23 For the full list of criteria refer to chapter 9 – Technical information.


25

Non-profi t institutions included in the Annual Enterprise Survey, plus those included in the estimation of religious institutions, are hereafter referred to as ‘large’.

For ’small’ non-profi t institutions, no specifi c survey data is available, and the estimate of their economic contribution is based on a number of annual fi nancial statements. Refer to the chapter 9, ‘Technical information’, for details of compilation.

Large non-profi t institutions contributed more to GDP (97 percent) than small non-profi t institutions (3 percent), although there are more than fi ve times as many small non-profi t institutions (84 percent) as large ones (16 percent). The main reasons for this are the scale of operations by small non-profi t institutions, as indicated by the size criterion above. For example, small non-profi t institutions have very few or no paid employees. If an estimate for the contribution of unpaid labour were included, then the contribution to GDP of these small units is expected to be much higher.24 However, no data is available to confi rm where most unpaid labour is occupied – whether within large or small non-profi t institutions.

Table 5.04

24 Refer to chapter 7.

Small NPIs(3) 103 81,550 16 percent of all NPIs are large

Large NPIs(4) 3,536 15,450

All NPIs 3,640 97,000

(1) Gross domestic product.(2) October 2005.(3) Small non-profit institutions are those that do not fulfill the Annual Enterprise Survey criteria.(4) Large non-profit institutions are those that fulfill the Annual Enterprise Survey criteria.

Contribution to GDP(1)

$(million)

Contribution to GDPBy non-profit institution size

Large NPIs contribute 97 percent of NPI GDP

Number of non-profit institutions (2)

March 2004 year

Key fact

Figure 5.05

Proportionof NPIs

Contribution to GDPof NPIs

0

20

40

60

80

100Percent

Size measure

Large NPI Small NPI

Contribution of Non-profit Institutions to GDPBy size of NPI

(1) (2)

(1) October 2005.(2) Year ended March 2004.(3) Economically significant.(4) Economically insignificant.

(3) (4)


26

Non-profit institutions in different sectors of the economySo far, data has been shown for all non-profi t institutions covered in the NPISA, regardless of where they are normally classifi ed within the NZSNA. Institutional units are grouped into broad sectors on the basis of the roles they play in the economy,25 with most non-profi t institutions being classifi ed to the non-profi t institutions serving households sector.

However, included in the satellite account are also non-profi t institutions classifi ed in the NZSNA to the corporation and government sectors. Presenting the data based on the institutional sector split makes these non-profi t institutions visible, since they are usually hidden within the national accounts, meaning that their contribution cannot usually be distinguished from other units within these sectors.

In addition to the non-profi t institutions classifi ed to the non-profi t institutions serving households sector, a considerable number of non-profi t institutions with a large contribution to GDP are operating in the non-fi nancial corporations sector.26 This is not surprising because, by the nature of their activity, their income is mainly derived from goods and services they provide at competitive (market) rates. This is the reason for their placement in this sector. However, the non-profi t institutions with the major contribution to GDP remain those within the non-profi t institutions serving households sector (69 percent).

International comparison of the sector results is limited because the degree to which the institutional sector framework is used varies from country to country. Some do not show the non-profi t institutions serving households sector separately, while others have only partly populated it or are using different criteria for deciding where units are placed.

25 Refer to chapter 3 – The classifi cation of transactors.26 Refer to table 3.02. Note that no non-profi t institutions meeting the structural-operational defi nition could be found in the fi nancial

corporations sector.


27

Non-profit institutions by industryTable 5.05

A Agriculture, forestry and fishing 8,801 8 0.1B Mining 1,329 0 0.0C Manufacturing 20,456 4 0.0D Electricity, gas and water supply 3,875 0 0.0E Construction 6,582 0 0.0F Wholesale trade 10,021 0 0.0G Retail trade 8,542 5 0.1H Accommodation, cafes and restaurants 2,537 142 5.6I Transport and storage 5,789 9 0.1J Communication services 4,231 1 0.0K Finance and insurance 8,835 4 0.0L Property and business services 29,192 145 0.5M Government administration and defence 5,895 1 0.0N Education 5,652 495 8.8O Health and community services 7,398 1,183 16.0P Cultural and recreational services 3,444 844 23.9Q Personal and other services 2,042 799 39.1

Financial service charge -5,165 0 0.0Total all industries 129,455 3,640 2.8

GST on production 9,578 … …Import duties 719 … …Other taxes on production … … …

Gross domestic product 139,753 3,640 2.6

(1) Non-profit Institutions Satellite Account.

Note: Individual figures may not sum to total due to rounding.


PercentIndustry group $(million)

Contribution to GDPBy industry breakdown

March 2004 year

NPISA(1) share of industry gross domestic

product

Non-profit institution satellite account

Total industry contribution

GDP attributable to non-profi t institutions amounted to $3.64 billion in 2004. This represents 2.6 percent of GDP for the total economy and 2.8 percent of the total for all industries (by ANZSIC 199627). The latter excludes GST on production and import duties.

Although non-profi t institutions are not a conventional ‘industry’ as such, their contribution to the economy can be compared with ANZSIC industries as a point of reference. By way of such a comparison, the GDP attributable to the agriculture, forestry and fi shing industry was $8.80 billion, and the GDP attributable to education was $5.65 billion. The non-profi t institution contribution to GDP exceeds that of four industry groups (mining; accommodation, cafes and restaurants; cultural and recreational services; personal and other services), but is less than the remaining 13 groups.

27 Refer to chapter 9 – Terms and defi nitions.


28

Non-profi t institutions make the most notable contributions to GDP in the industries of personal and other services (39 percent), cultural and recreational services (25 percent), and health and community services (16 percent).

Extending the analysisThe fi rst extension to the account on an SNA basis adds an estimate of the non-market output of market non-profi t institutions in the corporations sector. This extension is recommended in the United Nations Handbook on Non-Profi t Institutions in the System of National Accounts28 because market non-profi t institutions, unlike other market producers (such as limited liability companies), typically also provide a substantial amount of services (or goods) that are provided free or at reduced rates. Without this adjustment, this additional output is missed.

Table 5.06

(1) System of National Accounts.

2.33,640 82 3,722 Contribution to GDP of non-profit institutions

Accounting for goods and services not charged at commercial rates adds 2.3 percent to the conventional measure of GDP for NPIs.

Extension to SNA(1)-based Account: Non-market OutputMarch 2004 year

Impact of extensionTotalSNA(1)-basis Key fact

Non-market output of market units

$(million) Percent

Extending the data to also include services (or goods) provided free or at reduced rates by non-profi t institutions competing in the market adds $82 million to the contribution of non-profi t institutions to GDP.

The second extension includes a valuation of unpaid labour provided by volunteers, which adds a further $3.31 billion to the non-profi t institution contribution to GDP. This is a signifi cant addition and provides a better measure of the contribution non-profi t institutions make to the New Zealand economy. This extension is discussed in full in chapter 7.

The two extensions together add nearly $3.39 billion to the contribution non-profi t institutions make to GDP. This almost matches their monetary contribution of $3.64 billion. In other words, placing a value on volunteer labour and making an estimate for the services provided free by market non-profi t institutions almost doubles their contribution to the economy.

28 United Nations (2003), 4.78–4.81.


29

6 Sources of incomeThe income of non-profi t institutions is derived from three core sources:

● sales and other income

● investment income

● transfer income.

Table 6.01

29 Refer to chapter 5 – Data sources.30 United Nations Statistics Division (1993), 9.81.

Source of income

Sales and other income 4,869,708 60.6Investment income 478,107 5.9Transfer income 2,688,430 33.5Total non-profit institution income 8,036,245 100.0

$(000) Percent

By source of incomeNon-profit Institution Income

March 2004 year

Table 6.01 shows that sales of goods and services is the main source of income (61 percent) for all non-profi t institutions. Income from transfers (33 percent) is also signifi cant. Investment income is relatively small.

However, when we look at the market/non-market split of non-profi t institutions, the relative importance of the income sources is quite different. Because they are operating in the market, non-profi t institutions classifi ed as non-fi nancial corporations generate 95 percent of their income from sales of goods and services. For non-market units sales income (48 percent) is quite signifi cant. However, they rely also on transfer income (45 percent), which is considered a less stable source of income.

The size of non-profi t institutions is also a factor in the makeup of their income. For the 81,550 non-profi t institutions (84 percent) that are classifi ed as small,29 donations, memberships and grants were the major sources of income, providing them with more than 50 percent of their income.

DefinitionsFor the Non-profi t Institution Satellite Account (NPISA), the following defi nitions of income have been used:


A goods or services sale has the following characteristics:

a) the goods or services are exchanged at economically signifi cant prices, that is, the price has a signifi cant infl uence on the amount the producer is willing to supply and the buyer is willing to purchase

b) there is an exchange, such as cash, for the goods or services

c) it must be possible to observe and record the acquisition of the goods or services

d) the purchaser must have agreed to the provision of the goods or services.30

In practice, all sales receipts will be included even though the actual sales price may not fully satisfy (a) above. Non-profi t institutions may ‘sell’ goods and services at prices that may be below a market price – in order to raise some revenue or as a matter of policy – but the available data sources do not allow a distinction to be made between these types of sales and sales at market prices. All sales are included here.

With regards the exchange in (b) above, the benefi t to the purchaser should be certain and quantifi able, and the goods or service provided in exchange should be proportional to the amount paid. The distinction


30

is not always clear between goods and services provided under these ‘sales/purchase’ arrangements and those provided under some form of grant funding. This is discussed further below.

Sales of goods and services does not include non-operating income such as insurance rebates, gains on the sale of assets or the recovery of bad debts.

Investment income

Included here is the income earned on fi nancial investments – mainly interest and dividends. Excluded are the realised and unrealised gains on fi nancial assets.

Transfer income

Transfers are a payment made without receiving goods, services or assets in return. They can be either in cash or in kind, although most will be in cash.31 The extent to which in-kind transfers are recorded in the NPISA is dependent on the accounting practices adopted by the non-profi t institutions themselves. While most of the transfer receipts will be in cash, it is probable that some in-kind transfers are also recorded. Given the data sources, it is not possible to separately identify these. Transfers include donations, sponsorships, fundraising, and grants from both government and non-government sources.

Not included in the transfer income total in table 6.01 is the imputed value of formal unpaid work donated by households to non-profi t institutions. This is discussed in chapter 7.

The distinction between the different sources of income is not always clear, either in theory or in practice. Increasingly, the government has attempted to improve the effectiveness of the grants it makes to institutions such as non-profi t institutions by accompanying them with accountability contracts. The existence of the contracts has, in turn, blurred the distinction as to whether the government is purchasing a service from the non-profi t institutions or still making a grant without an exchange expected in return, especially as this service is being delivered to third parties (either individuals or groups). As a consequence, contracted grants have been treated on a case-by-case basis. In most cases there will be an expectation on the part of the institution making the transfer that there will be some defi ned outcome. However, this is often diffi cult to quantify and the link between the payment and what may be actually delivered can be quite loose. To be classifi ed as a sale, the contract grant must conform closely to the properties of a sale as listed in characteristics (a) to (d) above.

For example, in the NPISA, Sport and Recreation New Zealand (SPARC) funding to national sports organisations, although couched in contracts, is deemed to be transfers as it is not possible to observe and record the acquisition of individual goods or services. However, in the case of district health board contracts with rest homes, for example, the contracts are classifi ed as the purchase of individual services, as they lead to the delivery of a specifi c service based on the number of beds.

Insurance claims

This is an estimate of insurance claims received by non-profi t institutions.

Sales of goods and servicesAs noted in table 6.01, sales and other income are the largest source of income. Along with the normal range of goods and services one would expect non-profi t institutions to be selling, sales also include the following:

● Government contracts classifi ed as sales, which are signifi cant in the health and social services activity groups.

● Gambling services provided by gaming societies and racing clubs. In the national accounts, gross turnover less winnings is defi ned as the value of the gambling services provided.

● Membership subscriptions and fees charged by business associations. Following national accounts conventions, non-profi t institutions serving businesses are classifi ed as market non-profi t institutions because their subscriptions and fees are deemed to be payments for services rendered, that is, as the sale of a service. Conversely, membership fees and subscriptions paid to non-profi t institutions serving households are not treated as sales because the connection is considered to be less defi ned between the amounts paid and any resulting benefi t. These are classifi ed as donations.

31 United Nations Statistics Division (1993), 8.27.


31

Investment incomeInvestment income makes up only 6 percent of total income and for most of the non-profi t institution activity groups this is not a key source of income.

Table 6.02

Government Non-profit Institutions

Commercial Enterprises

Households

Lottery Grants Board

Licensing trusts

Community trusts

Gaming trusts

Philanthropic trusts

Affi liated payments

Business

Individuals

Bequests

Subscriptions

Donations

Government– local– central

Non-profitInstitutions

Source of income

Interest 345,971Dividends 132,135Total from investment income 478,107

$(000)

Non-profit Institution Investment IncomeBy source of income

March 2004 year

The two major exceptions are the philanthropic trusts in the grant making, fundraising and voluntarism promotion activity group, and religious institutions. For institutions in the former group, returns from investments in fi nancial and real assets are the primary source of income with which they maintain their grant making programmes. Investment income makes up 24 percent of their total income, and would be considerably higher if gaming society trusts were also excluded. Religious institutions also have substantial investment income. Much of this appears to result from national bodies pooling the resources of their constituent institutions and investing on their behalf.

Transfer income32

Non-profi t institutions receive transfers from a wide range of organisations in the economy. The key sources are illustrated in fi gure 6.01, and in table 6.03.

Figure 6.01

Sources of Non-profi t Institutions Transfer IncomeBy institutional sector

32 Excluding insurance claims.


32

Table 6.03

The diversity of non-profi t institution activities is matched by the diversity of sources from which non-profi t institutions receive funds. All institutional sectors make contributions, and household donations are the single largest item.

Sector

Transfer income from business enterprises(2) 215,985 8.1from government 758,829 28.5from non-profit institutions 542,653 20.4from households 1,146,758 43.0

Total transfer income 2,664,225 100.0

(1) Excluding insurance claims.(2) Non-financial and financial enterprises.

Non-profit Institution Transfer Income(1)

$(000)Percentage of total

transfer income

By institutional sectorMarch 2004 year

Transfers include membership subscriptions, fees, donations, sponsorships and grants.

Figure 6.02

Households

Business enterprises

Government

NPIs

Non-profit Institutions Transfer IncomeBy institutional sector

43%

8%

29%

20%

March 2004 year

(2)

(1)

(1) Excluding insurance claims.(2) Non-financial and financial enterprises.


33

33 http://www.dia.govt.nz/diawebsite.nsf/wpg_URL/Services-Community-Funding-Community-Organisation-Grants-Scheme-(COGS)?OpenDocument

34 Business and Economic Research Limited (2007), p38. 35 The report fi gure has been reduced by an arbitrary percentage to allow for infl ation and grants and sponsorship made to non-

profi t institutions. Given the nature of the estimate, no attempt was made to further adjust the fi gure for possible undercount.

Transfers from government

A number of central government departments and crown entities administer schemes that make grants to non-profi t institutions directly. Examples include SPARC, the New Zealand Film Commission and Creative New Zealand. Proceeds from state lotteries are distributed via the Lottery Grants Board.

As previously discussed, the distinction between grants and contracts is often blurred. In the tables, while every effort has been made to distinguish between these on the basis of the criteria previously discussed, grants may include some contracts and vice versa. In some cases, the classifi cation will be reasonably clear-cut, such as the Community Organisation Grants Scheme (COGS)33 administered by the Department of Internal Affairs, and the grants made by SPARC to regional sports trusts, both of which have been classifi ed as grants. However, other government transfers such as the funding of playcentres and a number of health contracts, could be classifi ed as either grants or contract sales. In the NPISA, playcentre funding has been classifi ed as a grant as it is more in the nature of a bulk-funding grant and cannot be clearly tied to the specifi c delivery of pre-school education services at the level of the individual playcentre, while most health payments are contractual in nature and are included in sales.

Local government also makes a number of grants to non-profi t institutions, funded from both their own sources and from central government.

Transfers from business enterprises

Business enterprises provide transfers to non-profi t institutions in the form of either donations or sponsorship, which may be in-cash or in-kind. The extent to which the in-kind transfers are captured in the NPISA donations fi gure will depend upon the accounting practices of the individual non-profi t institutions. A recent report commissioned by Philanthropy New Zealand, Giving New Zealand: Philanthropic Funding 2006,34 estimated that business and corporate donations and sponsorship was $254 million in 2006, a fi gure regarded as conservative because it excluded donations from smaller companies.

The data sources used to compile the NPISA do not distinguish between household and business donations and so an estimate has been made based on the above report.35

Transfers from other non-profi t institutions

Included in the $543 million current transfers received by non-profi t institutions from other non-profi t institutions, is an estimated $147 million from affi liated organisations. An approximately matching amount will be recorded in donations paid.

The remaining amount received by non-profi t institutions in this category will be from those non-profi t institutions that have been specifi cally established as grant-making foundations and charitable trusts. Examples include community trusts, energy trusts, gaming society trusts and other private charitable trusts and foundations.

Energy trusts are statutory bodies established to manage the ownership of lines companies on behalf of communities or consumers. A number of the energy trusts have been set up as charitable trusts and distribute their fi nancial returns via grants to the community, and are considered non-profi t institutions. However, many of the energy trusts distribute all or most of their profi ts to local customers in cash dividends. These institutions are not within the scope of the NPISA.

Gaming society trusts have been established to provide non-casino gaming machine gambling services and are required under statute to distribute their net profi ts to the local community. The distributions from these societies account for a signifi cant proportion of the non-profi t institution grants paid total, and these trusts now play a major role in funding the activities of other non-profi t institutions. Gaming machines are also owned by other non-profi t institutions such as sports clubs and chartered clubs, both of which are included within the scope of the NPISA. However, in these cases, the net profi ts from the machines can be used to fund their own authorised purposes and are predominantly spent within the non-profi t institutions themselves. This expenditure will not be included in transfers, but will be captured in the other operating or capital expenses of the non-profi t institution, depending on the purpose to which they are spent.


34

Transfers from households

Households are the largest provider of transfer income to non-profi t institutions. Households make monetary donations in a variety of settings – from street appeals, to collection plates at churches, to bequests. In addition, their participation in institutions may include a contribution via a subscription or membership fee, both of which are considered transfers because the actual service members may receive from the non-profi t institution is unlikely to bear a strong relationship to the amount paid.

But charitable giving extends beyond the cash fl ows measured here. Voluntary labour is the most signifi cant contribution, while many in-kind goods and personal resources are donated to the local club or society. While no information is available on the value of in-kind goods that may be donated (as with business sponsorship, in-kind household transfers of goods may be included in table 6.03 depending on the accounting practices adopted by the non-profi t institution).

Table 6.04 presents the same information as table 6.03, with the addition of the estimated value of volunteer work ($3.31 billion). As can be seen, the value of free time donated to non-profi t institutions is estimated to be almost three times the size of cash donations from households and represents a very signifi cant component of non-profi t institution income. While no information is available on the value of in-kind goods that may be donated (as with business sponsorship, in-kind household transfers of goods may be included in table 6.03 depending on the accounting practices adopted by the non-profi t institution), an estimate of voluntary labour has been made.

Table 6.04

Sector

$(000)Percentage of total transfer

income

Transfer income from business enterprises(3) 215,985 3.6from government 758,829 12.7from non-profit institutions 542,653 9.1from households total 4,458,728 74.6

from households in cash 1,146,758 19.2from household volunteer labour 3,311,970 55.4

Total transfer income 5,976,195 …

(1) Non-profit institutions.(2) Excluding insurance claims.(3) Non-financial and financial enterprises.


NPI(1) Total Transfer Income including Volunteer Labour(2)

By institutional sectorMarch 2004 year

Volunteer labour for non-profi t institutions is discussed in greater detail in chapter 7.


35

7 Volunteer labourIt is estimated that the value of unpaid labour employed by non-profi t institutions in New Zealand for the year to March 2004 was 2.3 percent of gross domestic product (GDP),36 or $3.31 billion. Including this amount in the economic accounts nearly doubles the contribution that non-profi t institutions make to GDP.

Table 7.01

36 The economic value of volunteer labour is included in the denominator of this GDP calculation.37 A more detailed defi nition is available in chapter 3 – Measurement framework.38 This report used data from the Time Use Survey 1998/1999.


$(million)

Extension to SNA(1)-based Account: Unpaid Labour

PercentKey fact

Total

March 2004 year

6,952Accounting for formal unpaid work within NPIs almost doubles their contribution to GDP.

SNA(1)-basis Unpaid labour Impact of extension

Contribution to GDP of non-profit institutions 3,640 91.03,311

This estimate indicates the reliance many non-profi t institutions have on unpaid (or voluntary) labour. The number of people who volunteered for one or more institutions for the year ended 31 March 2004 is estimated to be 1,011,600.

Formal unpaid workThe unpaid labour category measured formal unpaid work outside of the home for or through an organisation.37 To put formal unpaid work into context, Measuring Unpaid Work in New Zealand 199938 estimated the time use for an average week, for an average person 15 years or older in New Zealand. This average week can be broken down as time used for productive work and time used for non-productive leisure or rest, as illustrated in table 7.02.

Table 7.02

Hours per week 23.6 24.0 1.9 1.7 116.8 168Percentage of total hours 14.0 14.3 1.1 1.0 69.5 100.0

(1) For the average New Zealander 15 years and over.

Note: Individual figures may not sum to total due to rounding.

Total

All activities

Within own household

Informal, outside own household

Formal, outside own household

Time Use in an Average Week(1)

1999

Market work

Productive

Productive and non-productive activities

Unpaid work Non-productive eg sleeping,

exercising, eating

Table 7.02 shows that in 1999 formal unpaid work constituted 1.7 hours a week for the average person in New Zealand. Informal helping of others outside of the home constituted 1.9 hours and work within the home constituted 24.0 hours.


36

While many studies look at specifi c aspects of volunteering, there are very few suitable data sources that look in a consistent manner at formal unpaid labour at the national level. For the estimates in this chapter, the 2001 and 2006 Censuses and the Time Use Survey 1998/99 have been used.

Volunteering for non-profi t and government institutions

The total estimate of formal unpaid work is $3.31 billion, including unpaid work for both non-profi t and government institutions. It is not directly possible to split formal unpaid work between that for non-profi t institutions and that for government institutions, due to the nature of the data from the censuses and the Time Use Survey. However, a conservative estimate can be made for formal unpaid work directly for or through non-profi t institutions. Using the available data on government volunteering, it can be inferred that approximately 2 percent of total formal unpaid work ($70 million) is done directly for or through government institutions.39 Therefore, it is estimated that formal unpaid work for or through non-profi t institutions is 98 percent ($3.24 billion) of all formal unpaid work.

Splitting voluntary labour between non-profi t and government institutions has not been taken further in this account. This decision is based on the lack of robust data on government volunteering. In addition, differentiating between whether formal unpaid work was done for a non-profi t institution or for a government institution can be diffi cult. Close relationships between government and non-profi t institutions, with volunteering for government happening through non-profi t institutions, are common. For example, some public hospitals have closely associated non-profi t foundations that attract, train and help administrate volunteers in the hospital. In an economic sense, the volunteer labour is being donated ‘in kind’ through a non-profi t institution to a government institution. These relationships can have an aspect of reciprocity, with the government institution providing funding, staff or other resources (offi ces, computers etc) to the non-profi t institution.

Volunteer numbers and hours workedBecause the Time Use Survey 1998/99 is essentially fi ve years older than the reference period of March 2004 for this report, the data was extrapolated forward. The census question about ‘other helping or voluntary work for or through any organisation, group or marae’ showed an increase of 2.1 percent between 2001 and 2006. This was the most suitable data available, and was used to rate forward the survey data to 2004, both for the number of volunteers and the hours of formal unpaid work.

Number of volunteers

The number of people who volunteered for one or more non-profi t institutions is estimated to be 1,011,600 for the year ending 31 March 2004,40 representing 31 percent of the New Zealand population aged 12 years and over. The Time Use Survey also provided estimates on the number of institutions. that a volunteer had worked for. Table 7.03 shows that the majority of volunteers (54 percent) conducted formal unpaid work for one institution. However, there was a signifi cant number of people who volunteered for two or more institutions.

Table 7.03

39 The most signifi cant caveat in this estimate is that volunteering directly for public schools (that is not through a parent teacher association or similar organisation) could not be accurately estimated.

40 This estimate is derived from previously unreleased data from the personal questionnaire of the Time Use Survey 1998/99.

Number of institutions1 542 303 104 or more 6

(1) Primarily non-profit institutions, although a small number of government institutions are included.

1999Number of Institutions Worked for per Volunteer(1)

Percentage of volunteers


37

Because 46 percent of volunteers do so for more than one institution, there are more unpaid positions volunteered for than the actual number of people who volunteer. From this perspective, it is estimated that non-profi t institutions fi lled 1,727,400 volunteer positions for the year ended 31 March 2004.

Economic value of hours volunteered

Using data from the Time Use Survey, it was possible to estimate the total number of hours of formal unpaid work, broken down by the survey activity groups – as given in table 7.04. Not all Time Use Survey activity groups are comparable to NZSCNPO. See appendix 4 for a comparison of the survey activity groups with NZSCNPO activity groups.

Full-time equivalent volunteers (FTEs) were calculated by taking the average hours worked per week in paid work in March 2004 (38.8 hours41), and applying this to the total hours worked by volunteers, and then dividing this by 52 weeks.

Table 7.04

41 Derived from the Quarterly Employment Survey

Mäori-based committee, organisation, grouping, etc(3) 27,878 13,803 341,674 Disability support and health-related service 11,198 5,544 137,243 Social support and assistance 22,746 11,262 278,783 Education 40,089 19,849 491,332 Community safety and protection 22,858 11,318 280,147 Leisure and recreation 78,241 38,739 958,926 Member benefit groups 62,106 30,750 761,179 Other(3) 5,115 2,532 62,687 Total 270,230 133,799 3,311,970

(1) Based on the Time Use Survey 1998/99 classification.(2) Non-profit Institutions.(3) Due to the high sample error rates of the source Time Use Survery 1998/99 data, these categories should be used with caution.

Note: Individual figures may not sum to totals.

Formal Unpaid Work Outside the Home(1)

March 2004 year

$(000)Activity group(1)

Total hours worked Full-time equivalent

volunteers for NPIs(2) Economic value

(000) Number

The Time Use Survey activity groups have a few distinct characteristics that should be noted when interpreting the data:

● ‘Mäori-based committee, institution, grouping etc’ covers any unpaid work related to the propagation and support of Mäori language and culture.

● ‘Community safety and protection’ includes environment groups, animal protection institutions, 24-hour emergency services and community wardens.

● ‘Leisure and recreation’ includes institutions with a sporting, cultural or recreational focus.

● ‘Member benefi t groups’ is a catch-all activity group. The general focus is the enhancement of their members, if they are not already included in any other activity group. The group includes religious institutions, service clubs, political parties, and professional associations and labour unions.


38

The technique chosen for estimating the economic value of formal unpaid work was ‘replacement cost’. This technique assumes that an activity in unpaid work is worth the same amount as it is in market employment. Using Time Use Survey activity data, it was possible to assign many of the unpaid activities to similar paid occupations. All unpaid activities were then assigned the wage rate of the corresponding paid occupation. Each ‘wage rate’ was then weighted by the number of unpaid hours worked on that activity, and then aggregated to give an overall average ‘volunteer wage rate’42 of $12.15 an hour43 as at 31 March 2004, which is detailed in table 7.05. In comparison, the minimum wage rate as at 31 March 2004 was $8.50 an hour.

Table 7.05

42 A similar method of valuing volunteer labour was used in: Value Added by Voluntary Agencies: Counting for Something Report, produced by the New Zealand Federation of Voluntary Welfare Organisations. For more information, see www.nzfvwo.org.nz/fi les/VAVAreport_summary.pdf

43 To be conceptually consistent with compensation of employees in the System of National Accounts, a multiplier of 1.0088 was used on the wage rate of $12.15, to model the Accident Compensation Corporation and superannuation payments that would have been paid if the work was paid.

Job descriptionNZSCO code(1)

Special interest organisation administrators 114 10.5 17.07

Office clerks 41 35.1 13.70

Writers, artists, entertainment and sports associate professionals 336 1.7 13.64

Food and related products processing trades workers 741 1.1 13.44

Personal care workers 513 6.7 10.05

Personal care workers and house-keeping and restaurant service workers(4) 512 & 513 44.8 10.00

Total … 100.0 12.15

(1) New Zealand Standard Classification of Occupations 1999.

(4) Residual category for any activities that could not be coded elsewhere.

Note: The wage rate of $12.15 is adjusted by a factor of 1.0088 to be consistent with compensation of employees in the System of National Accounts. This inflates the hourly wage rate to $12.26.


(2) Percentages may not sum to totals due to rounding.(3) Part-time wage rate was used, where available, from June 2003 data.

March 2004 yearValue of Formal Unpaid Work

Percentage of total hours worked(2)

Hourly wage rate ($)(3)

Using the replacement cost method, the average volunteer contributes $3,274 to GDP annually for all the non-profi t institutions they volunteer for.

Comparison of paid and unpaid labour within non-profi t institutions

Volunteers make a signifi cant contribution to the labour force of non-profi t institutions. Using the replacement cost method, the economic ‘wages’ of volunteers can be compared with the salaries and wages of paid workers. It is possible to report this by activity group, with some Time Use Survey activity groups corresponding closely to NZSCNPO categories.


39

Figure 7.01

Compensation of Employeesand Imputed Volunteer Wages

By activity group2004

All other groups

Health and social services



0 500 1,000 1,500 2,000 2,500

Activity group

$(million)

Compensation of employees Imputed volunteer wages

Figure 7.01 shows the contribution of paid staff and volunteers in terms of compensation of employees. Culture and recreation has a relatively large contribution of formal unpaid labour, refl ecting the fact that 94 percent of non-profi t institutions in culture and recreation employ no paid staff. Education and research, while employing the most staff after social services, also benefi ts from the signifi cant contribution of unpaid labour, with parents being a major contributor. Health and social services, while aggregated together, show proportionately the least reliance on unpaid work. This is because these activity groups contain some of the largest and most formalised non-profi t institutions. All other activity groups have a relatively high dependence on unpaid labour, although this will vary from group to group.


40

International comparisons of volunteering for non-profi t institutions

Table 7.06

New Zealand (2004) 2.3 31 5.1

United Kingdom 3.0 (4) 39 (5) ..

Australia (2000) 1.4 32 3.2

Canada (2000) 1.4 27 3.1

United States 2.2 (4) 27 (4) 2.4 (5)

(1) Countries that share a common historical association with the Anglo-Saxon political and legal tradition and a high level of economic developmen. Definition used is part of the Johns Hopkins University comparative study into the non-profit sector.The minimum age from which the volunteering rate is measured from differences betweencountries: New Zealand (12+), United Kingdom, United States (16+), Australia (18+) and Canada (15+).

(2) Gross domestic product.(3) Non-profit institutions.(4) Data derived from 1995 Johns Hopkins University estimates, not from an equivalent

satellite account.(5) For the United Kingdom, this is from the Citizenship Survey, for the United States it is from

the Current Population Survey 2005 estimate.

Symbol:.. figures not available.

Note: International comparisons of this nature should be used with caution.

Comparison of Volunteering for Non-profit InstitutionsAnglo-Saxon countries (1)

Percentagecontribution to

GDP(2) of voluntary labour

for NPIs(3)

Percentage of population

volunteering for NPIs

Average hours worked per week

per volunteer

Volunteering in New Zealand compares favourably with volunteering in other ‘Anglo-Saxon’ countries with which New Zealand has traditionally shared close ties. New Zealand has the highest average hours volunteered per week per volunteer, has the second highest contribution to GDP of volunteer labour, and is third in the proportion of the population volunteering.

These Anglo-Saxon countries share two main characteristics – a high level of economic development, and a common historical association with the British legal and political system, which has emphasised the relatively small role of the state, placing signifi cant reliance instead on private charitable activity. The data given in table 7.06 should be used with caution, as it was collected using different types of surveys, with different interpretations of defi nitions, and the reference year differs for each country. It is, however, the most suitable data available.

The New Zealand data includes numerical and fi nancial data from all non-profi t institutions. The number of universities and public hospitals in New Zealand is relatively small and not included in the non-profi t institution sector. In contrast, non-profi t health-care and education in the UK, Australia, USA and Canada contribute a signifi cant part of the total employment and contribution to GDP of non-profi t institutions. This difference is implicit within the numbers and does not invalidate a comparison between countries.

Overview of volunteer demographicsThe 2006 Census collected information on unpaid work from three tick boxes in the census form. The total number of responses for each category are given in table 7.07.


41

Table 7.07

Type of unpaid work

Looking after a child who does not live in own household 460,146Helping someone who is ill or has a disability who does not live in own household 258,708Other helping or voluntary work for or through any organisation, group or marae 437,241

Total responses

People who Did Unpaid Work Outside the Home Four weeks prior to Census night 2006

There are a number of limitations with the census data. Firstly, the three categories cannot be summed together, as a respondent can tick more than one box. More importantly however, only the third category, ‘other helping or voluntary work for or through any organisation, group or marae’, contains data that solely relates to non-profi t institutions. There is not a clear distinction between informal and formal unpaid work outside of the home in the fi rst category, ‘looking after a child who does not live in own household’, and the second category, ‘helping someone who is ill or has a disability who does not live in own household’, as both contain formal and informal unpaid work.

The demographic characteristics of volunteers in the category ‘other helping or voluntary work for or through any organisation, group or marae’, is explored below. It should be noted that while the Time Use Survey and the 2006 Census have quite different results in terms of the absolute numbers of volunteers, they have very similar demographic distributions.

Age and sex

Figure 7.02

People Involved in Voluntary Work by SexPercentage of age group

2006 Census

15–1920–2425–2930–3435–3940–4445–4950–5455–5960–6465–6970–7475–7980–84

85+

-25 -20 -15 -10 -5 0

Age group (years)

15–1920–2425–2930–3435–3940–4445–4950–5455–5960–6465–6970–7475–7980–8485+

0 5 10 15 20 25

Age group (years)

Percent

Male Female

Figure 7.02 shows two signifi cant points of interest. Firstly, in all age groups from 25 to 75 years, more females than males ticked ‘other helping or voluntary work for or through any organisation, group or marae’ in the 2006 Census. Secondly, the disparity between males and females is relatively pronounced around the two peaks for female formal unpaid work, occurring at ages 40–44 and 65–69 years.

Ethnicity

People can nominate themselves for more than one ethnic group in the census and this should be taken into consideration when interpreting the data. Other factors such as language barriers for migrants, cultural understanding about unpaid work, and the different age structures of ethnic groups can also infl uence how questions on unpaid work are answered.


42

Figure 7.03 shows that in 2006, proportionately more people in the census category ‘other ethnicity’ ticked ‘other helping or voluntary work for or through any organisation, group or marae’ than people of other ethnicities. The ‘New Zealander’ ethnic category makes up 99.7 percent of ‘other ethnicity’. Proportionately more Mäori ticked ‘other helping or voluntary work for or through any organisation, group or marae’ than European or Pacifi c peoples, who had similar levels of response to the question.44 Asian and Middle Eastern/Latin American/African peoples had a lower response than other ethnicities.

Figure 7.03

44 It is possible that the use of the word ‘marae’, prompted more Mäori to respond to the question.45 Refer to http://www.stats.govt.nz/census/default.htm for further detail.

Detailed data on unpaid work, from the 2006 Census, will available in late December 2007.45

Other ethnicity

Middle Eastern/Latin American/African

Asian

Pacific peoples

Mäori

European

0 5 10 15 20 25

Ethnic group

Percent

People Involved in Voluntary WorkPercentage of ethnic group

2006 Census


43

8 Profiles of non-profit institutions by activity group Non-profi t institutions undertake a diverse range of activities and serve many different purposes. It therefore makes sense to group together those institutions that are involved in similar activities, or that are serving similar purposes. The New Zealand Standard Classifi cation of Non-Profi t Institutions (NZSCNPO) has been developed for the Non-profi t Institutions Satellite Account (NPISA). The NZSCNPO comprises 12 major activity groups, which are:


● Education and research

● Health

● Social services

● Environment



● Grant making, fundraising and voluntarism promotion

● International

● Religion


● Not elsewhere classifi ed (a residual, catch-all category).

A detailed breakdown of the NZSCNPO can be found in appendix 2.

Each of these activity groups is distinct, and non-profi t institutions can vary in their structure, size and operational processes across and within activity groups. Information on each of the activity groups can be used to compare an individual non-profi t institution to its group benchmarks, and also to contrast the relative sizes of the 12 groups.

This chapter provides information for each non-profi t institution activity group, including the population of the group, the level of employment, the distribution of this employment, and the contribution of the group to the gross domestic product (GDP).

Tangata whenua governance shows a similar level of detail to the main activity groups. This recognises the importance of these institutions, even though they are treated as a subgroup for the purposes of international comparability.

For the culture and recreation group, and the education and research group, information is provided at a more detailed (subgroup) level.

Income and expenditure information is also presented for these groups and subgroups. The main components of income for non-profi t institutions are sales of goods and services, and donations, memberships and grants. This income is largely spent on compensation of employees, and purchases of goods and services. The contribution of each of these components varies across groups.

Culture and recreation The culture and recreation group consists of cultural arts and sports organisations, social clubs and other recreational clubs. It is by far the largest group in terms of numbers of non-profi t institutions. This refl ects the signifi cant role these activities play in many New Zealanders’ lives. The group is made up of four very distinctive subgroups.

The culture and arts subgroup consists of non-profi t institutions involved in media, communications, visual arts, architecture and performing arts; historical, literary, heritage and humanistic societies; museums; toy libraries; and zoos and aquariums.

The sports subgroup encompasses the full range of amateur sports clubs, physical fi tness, sports competition services and events. This includes a diverse range of grassroots sporting clubs, sports centres and surf lifesaving clubs. The sports subgroup includes some institutions that were diffi cult to classify. For example, racing clubs, which undertake to provide entertainment to households, conduct horse racing, and provide


44

gambling activities. As such they are classifi ed as non-fi nancial corporations serving businesses in the New Zealand System of National Accounts (NZSNA). However, as incorporated societies, they do not distribute surpluses to their members and therefore qualify for inclusion in the NPISA.

The third subgroup is other recreation and social clubs, which includes institutions providing services to members, recreational facilities and local communities. Some examples of these institutions are local country clubs, men’s and women’s clubs, Lions and Rotary clubs, and returned services associations.

The fourth subgroup includes institutions with supporting services for culture and recreation, where actual participation in culture and recreation are not the primary activities.

It is important to note that some institutions were excluded from the NPISA because they did not meet the structural-operational defi nition of a non-profi t institution. Some museums or museum trust boards are administered by local authorities and are therefore classifi ed to the local government sector.

There were some conceptual issues around the classifi cation of some particular institutions:

● Surf lifesaving clubs have been classifi ed under sports, as opposed to the subgroup emergency and relief, because their prime focus is deemed to be sports. This is refl ected in Statistics New Zealand’s existing industrial coding.

● Other recreation and social clubs includes service clubs. The United Nations Handbook on Non-Profi t Institutions in the System of National Accounts clearly includes “membership organizations providing services to members and local communities, for example, Lions, Zonta International, Rotary Club and Kiwanis”46 in this group. An alternative classifi cation would be the economic, social and community development subgroup which is supported by the Community and Voluntary Sector Working Party (Ministry of Social Development, 2001),47 who group service clubs under ‘community and society’.

Key statistics

Table 8.01.01

46 United Nations (2003), 93. 47 Ministry of Social Development (2001).

Number of NPIs employing paid staff 2,380 9,780 24.3 1Number of NPIs not employing paid staff 40,840 87,220 46.8 1Total number of NPIs 43,220 97,000 44.6 1Number of employees 16,820 105,340 16.0 3Contribution to GDP ($000)(3) 466,104 3,640,162 12.8 5

(1) Non-profit institutions.(2) Ranking among all 12 activity-based non-profit institution groups.(3) March 2004 year.

Note: All count data has been randomly rounded to protect confidentiality.

October 2005

Rank(2)All NPIs(1) Percentage of all NPIs

Culture and Recreation Non-profit Institutions


Key statistics

Culture and recreation is the largest non-profi t institution activity group by number of institutions. However, it is only the third largest group by number of employees. Table 8.1.01 indicates that most non-profi t institutions in this group (94 percent) rely entirely on volunteers to maintain their operations. Although culture and recreation has the most institutions, their economic contribution is only the fi fth largest amongst all non-profi t institution activity groups.


45

Table 8.01.02

48 New Zealand Tourism Research, AUT (2007), 2.49 Sport and Recreation New Zealand (2007), 2.

Number of NPIs(1) employing paid staff 350 1,390 610 35 2,380Number of NPIs not employing paid staff 4,670 13,510 22,590 60 40,840Total number of NPIs 5,020 14,910 23,210 95 43,220Number of employees 2,210 9,000 5,310 300 16,820Contribution to GDP ($000)(2) 62,417 261,586 134,328 7,773 466,104

(1) Non-profit institutions.(2) March 2004 year.


Culture and arts (1100) Sports (1200)

Culture and Recreation Subgroups Key statisticsOctober 2005

Subgroup

Other recreation and social clubs

(1300)


support and ancillary

services (1999)

Total

Culture and arts is the third largest subgroup across all measures. This subgroup is unique in terms of its activity. There are 5,020 non-profi t institutions in the culture and arts subgroup, including museums. A recent survey by New Zealand Tourism Research at the Auckland University of Technology showed that there are 426 museums in the country.48 Fifteen percent of those that responded to the survey are either privately owned, or council-controlled institutions, and such museums are therefore not included in the NPISA.

The sports subgroup has the highest number of paid employees (54 percent) and the highest contribution to GDP (56 percent) within the activity group. Of all non-profi t institutions in this subgroup, 13,510 (91 percent) do not employ paid staff, which indicates how important volunteer labour is as part of the ongoing existence of these institutions. A 2007 Sport and Recreation New Zealand (SPARC) report highlighted the volunteer contribution to the sport and recreation sector. According to the report, the sector is dependent on approximately 500,000 volunteers. This is approximately fi fty-six volunteers for every paid employee.49

The other recreation and social clubs subgroup has the greatest number of institutions amongst all the subgroups. They are the second largest subgroup by paid employees (32 percent), however 97 percent of their institutions do not employ paid staff.


46

Employment

Table 8.01.03

Number of paid employees

0 40,840 94.51–5 1,630 3.86–19 570 1.320–99 170 0.4100+ 9 --Total 43,220 100.0

Note: All count data has been randomly rounded to protect confidentiality. Individual figures may not sum to total due to rounding.

Symbol:-- amount too small to be expressed.


October 2005By number of employees

Number of non-profit institutions Percentage

Table 8.1.03 shows that 95 percent of all cultural and recreational non-profi t institutions do not employ any paid staff. Instead, these institutions are entirely dependent on formal unpaid labour. There are just a handful of non-profi t institutions that employ 100 or more paid staff.


47


Table 8.01.04

IncomeSales of goods and services 984,000 60.6Interest received 37,359 2.3Dividends received 3,258 0.2Membership, donations and grants(1) 473,951 29.2Government grants(2) 119,078 7.3Insurance claims 6,893 0.4

Total income 1,624,539 100.0

ExpenditurePurchases of goods and services(3) 997,080 70.0Compensation of employees 322,836 22.7Taxes on production 26,198 1.8Donations paid 45,830 3.2Interest payments 20,951 1.5Net insurance premiums 12,158 0.9



(1) This does not include government grants.(2) Government grants does not include government contracts.(3) This is also referred to as intermediate consumption.



Percent$(000)

Income and expenditureMarch 2004 year

Of every dollar of income, 61 cents comes from the sales of goods and services, while 29 percent of income is from donations, memberships and grants. Total expenses are dominated by two items: 70 percent of expenditure is on the purchase of goods and services; while 23 percent goes towards compensation of employees. After expenses and depreciation have been deducted, the culture and recreation group has recorded savings of close to $33 million.


48

Table 8.01.05

IncomeSales of goods and services 81,773 45.2 516,496 57.2 375,984 72.8 9,748 40.9 984,000Interest received 5,502 3.0 18,779 2.1 10,676 2.1 2,401 10.1 37,359Dividends received 531 0.3 513 0.1 1,956 0.4 258 1.1 3,258Membership, donations and grants(1) 55,492 30.7 292,742 32.4 116,242 22.5 9,475 39.7 473,951Government grants(2) 37,021 20.4 70,904 7.9 9,222 1.8 1,931 8.1 119,078Insurance claims 719 0.4 3,525 0.4 2,608 0.5 41 0.2 6,893

Total income 181,037 100.0 902,960 100.0 516,689 100.0 23,853 100.0 1,624,539

ExpenditurePurchases of goods and services 105,930 64.4 581,157 73.0 301,734 67.3 8,259 51.8 997,080Compensation of employees 50,170 30.5 163,769 20.6 102,417 22.8 6,479 40.6 322,836Taxes on production 105 0.1 5,557 0.7 20,394 4.5 142 0.9 26,198Donations paid 5,469 3.3 28,463 3.6 11,449 2.6 449 2.8 45,830Interest payments 1,550 0.9 11,067 1.4 7,783 1.7 551 3.5 20,951Net insurance premiums 1,268 0.8 6,217 0.8 4,600 1.0 73 0.5 12,158

Total expenditure 164,492 100.0 796,230 100.0 448,378 100.0 15,952 100.0 1,425,053

SurplusIncome minus expenditure 16,545 … 106,730 … 68,311 … 7,901 … 199,486



Total

Subgroup

Culture and Recreation Non-profit Institution SubgroupsIncome and expenditure

March 2004 year

Culture and arts (1100)

Sports(1200)

Culture and recreation support

and ancillary service (1999)

Other recreation and social clubs (1300)

Percent$(000) $(000) Percent $(000) Percent Percent $(000)

The primary source of income for all subgroups is the sale of goods and services, which encompasses the sale of tickets to events such as sport games, theatre, plays, dance shows, and art exhibitions. Donations, memberships and grants are the second largest contributors to income. Through all subgroups, expenses are dominated by purchases of goods and services. These represent a diverse range of purchases such as sports developments, those needed to run theatre shows, cultural performances and other social activities. The second largest component of expenses is compensation of employees.

Membership data

Membership subscriptions are a key component of income for sports clubs in New Zealand. The information in table 8.1.06 shows the distribution of sporting memberships across most major sports disciplines, along with an overall 5 percent increase in sports memberships between 2001 and 2002. The large number of memberships shows that sports clubs are an integral part of the lives of many New Zealanders.


49

Table 8.01.06

2001 2002

Golf 166,027 168,080

Netball 122,350 123,069

Rugby 119,874 121,623

Soccer 109,300 105,000

Cricket 94,567 102,759

Touch 69,426 94,291

Indoor sports 65,477 77,065

Bowls 61,349 60,404

Tennis 42,419 42,312

Hockey 37,449 39,574

Yachting 32,162 31,338

Others 414,762 430,711

Total 1,335,162 1,396,226

Source: Sport and Recreation New Zealand (SPARC).

Membership of Sports Non-profit Institutions2001 and 2002

Number of membersSports

Sports was the only subgroup for which full membership data was available. However, it is recognised that membership plays an important role in many other cultural and recreational institutions even though that information is not readily available.

Education and research Education and research contains all non-profi t institutions that can be broadly defi ned as providing or supporting education. This includes kindergartens, playcentres, kohanga reo, private primary and secondary schools, private tertiary providers, other education providers such as organisations teaching English for speakers of other languages, and research institutions. Public education institutions such as universities, colleges of education, polytechnics, state and integrated schools, however, are not included.

Education and research makes up 16 percent of the total non-profi t institution contribution to GDP. In the context of the wider education sector (including non-profi t, for-profi t, and state education), it is interesting to note the relatively small size of non-profi t institution education and research. In 2004, the entire education sector contributed $5.65 billion to GDP, while non-profi t education and research contributed $495 million, or 9 percent of the education sector’s GDP. The main reason for this relatively small contribution is that the majority of New Zealand’s education institutions are within the government sector. This contrasts with comparable countries such as Australia, Canada, the UK and the USA, where non-profi t education is generally much more widespread. It is also important to note that non-profi t research is a relatively small sector in New Zealand, with many research institutions being either profi t-making companies or within the government sector.

There are signifi cant structural variations between institutions in terms of governance, fi nancial structures, and legal status. For example, one non-profi t institution may have more than one campus or school, but will be counted only once. Furthermore, some institutions employ on behalf of associated institutions. In this case, an institution may not employ directly, and so would be counted as ‘not employing’, even if it has paid staff. It is important to also note that while many state-integrated schools were historically non-profi t institutions, they are no longer, being essentially state schools under the Private Schools Conditional Integration Act 1975.

Volunteering plays a signifi cant role in the education and research group, where 77 percent of institutions do not employ paid staff.


50

Key statistics

Table 8.02.01

Number of NPIs employing paid staff 1,670 9,780 17.1 4

Number of NPIs not employing paid staff 5,730 87,220 6.6 6Total number of NPIs 7,400 97,000 7.6 6Number of employees 20,140 105,340 19.1 2

Contribution to GDP ($000)(3) 581,154 3,640,162 16.0 2



Percentage of all NPIsAll NPIs(1) Rank(2)

Education and Research Non-profit Institutions


Key statisticsOctober 2005

Education and research is dominated by smaller, non-employing non-profi t institutions. Within this activity group, 50 percent are in the education and research support and ancillary services subgroup. Many of these are parent teacher, or home and school associations.

Education and research is the second largest employer among non-profi t activities after social services, and it makes the second largest contribution to GDP (16 percent). Because compensation of employees is the major contributor to GDP from non-profi t institutions, a large contribution to GDP is to be expected in a group with a relatively high employment count.

Table 8.02.02

Number of NPIs(1) employing paid staff 990 75 510 100 1,670Number of NPIs not employing paid staff 1,040 110 980 3,590 5,730Total number of NPIs 2,030 180 1,490 3,690 7,400Number of employees 8,800 4,330 6,050 970 20,140Contribution to GDP ($000)(2) 155,600 169,372 216,279 39,902 581,154

(1) Non-profit institutions.(2) March 2004 year.


Key statistics


support and ancillary

services (2999)

Total

Education and Research Subgroups

Early childhood education (2110)

Primary and secondary

education (2120)

Higher education, other education and

research(2200,2300,2400)

Subgroup

October 2005


51

The early childhood education subgroup makes up just over one quarter (27 percent) of all non-profi t institutions in education and research. Early childhood education has a high level of employment, nearly half of all institutions in this subgroup employ paid staff. Those that do not employ include parent-led groups, and kindergartens whose teaching wages are paid by a central body. Kindergarten associations may administrate from a central location, even though there may be many local kindergartens. In this case, the kindergarten itself may not employ, and so will be counted in the non-employing category.

Primary and secondary education comprises mainly well-established schools, some of which are quite large. The top 10 primary and secondary schools employ 2,233 staff, or 52 percent of the total staff for this sub-group, signifi cantly pulling up the average for schools that employ paid staff. The contribution to GDP of this subgroup is the largest subgroup in the education and research group because of the relatively high number of paid staff.

The remaining subgroup (higher education, other education and research) covers a wide range of non-profi t institutions that consist of either post-school education, research or specialist education. Larger institutions include apprentice training schemes, ‘work in the community’ programmes, theological colleges and research institutions, while the smaller non-profi t institutions are diverse in nature.

Employment

Table 8.02.03


0 5,730 77.41–5 890 12.06–19 600 8.120–99 150 2.0100+ 30 0.4Total 7,400 100.0



Education and Research Non-profit Institutions


Although 77 percent of non-profi t institutions in education and research are non-employing, this is considerably lower than the non-profi t institution average of 90 percent. Most institutions that do employ have between one and 19 employees. There are signifi cantly fewer non-profi t institutions employing 20 or more staff, most of which are large private schools, early childhood education associations, or apprentice training institutions.


52


Table 8.02.04


Total income 1,041,883 100.0


Total expenditure 947,884 100.0




Income and expenditureEducation and Research Non-profit Institutions

March 2004 year

$(000) Percent

Education services are purchased either by individuals paying school fees, or by the government subsidising apprentice training schemes. Donations constitute a considerably smaller proportion of income.

The expenditure data illustrates that education and research is dependent to a large extent on paid staff, with 55 percent of expenditure incurred through salaries and wages. The purchase of goods and services accounts for 42 percent of expenditure, refl ecting the use of teaching resources in the provision of education services.


53

Table 8.02.05

50 For more detail on primary health care and the operation of PHOs in New Zealand, refer www.moh.govt.nz/moh.nsf/indexmh/phcs-faq.

IncomeSales of goods and services 41,495 18.5 205,604 76.7 198,592 44.5 57,712 55.9 503,404Interest received 2,977 1.3 7,686 2.9 7,432 1.7 3,589 3.5 21,683Dividends received 2,345 1.0 433 0.2 510 0.1 150 0.1 3,438Membership, donations and grants(1) 16,488 7.4 13,825 5.2 58,055 13.0 20,992 20.3 109,359Government grants(2) 160,422 71.6 39,616 14.8 181,273 40.6 19,626 19.0 400,937Insurance claims 369 0.2 804 0.3 745 1,143 1.1 3,062

Total income 224,097 100.0 267,967 100.0 446,606 100.0 103,212 100.0 1,041,883

ExpenditurePurchases of goods and services 52,388 25.9 74,716 32.0 210,653 51.6 64,315 62.1 402,070Compensation of employees 145,322 71.7 150,558 64.5 189,361 46.4 32,197 31.1 517,438Taxes on production 582 0.3 1,056 0.5 1,631 0.4 434 0.4 3,703Donations paid 2,712 1.3 25 0.0 3,784 0.9 2,593 2.5 9,114Interest payments 995 0.5 5,689 2.4 1,436 0.4 2,039 2.0 10,159Net insurance premiums 651 0.3 1,417 0.6 1,315 0.3 2,017 1.9 5,400

Total expenditure 202,650 100.0 233,461 100.0 408,179 100.0 103,594 100.0 947,884

SurplusIncome minus expenditure 21,448 … 34,505 … 38,428 … -382 … 93,999



$(000)


Early childhood education

(2110)

Education and research support

and ancillary service (2999)

Higher education, other education and

research(2200,2300,2400)

Total

Percent $(000) Percent

Education and Research Non-profit Institution Subgroups

March 2004 year

Primary and secondaryeducation

(2120)

Subgroup

Percent$(000) Percent $(000)

Government grants make up 72 percent of the income for early childhood education. Compensation of employees makes up 72 percent of expenditure for early childhood education, the largest proportion of any subgroup in education and research.

Private schools are funded almost entirely by school fees and money from government, which is treated as contracted goods or services. These items are allocated to sales, with the result that sales of goods and services make up the majority (94 percent) of income of the primary and secondary education subgroup.

The education and research support and ancillary service subgroup is fi nancially dominated by support services to education, such as school hostels, school trusts and school bus committees.

Health In New Zealand most hospitals are publicly owned and are therefore not included in the NPISA. There are, however, a small but signifi cant number of privately-owned hospitals, some of which are run as non-profi t institutions.

The group encompasses a wide range of health services as well as private hospitals run on a non-profi t basis. These include rehabilitative services, nursing homes, emergency medical services, outpatient health services, public health education, primary health services and mental health services, including psychiatric hospitals, crisis intervention and outpatient treatment.

The group also includes primary health organisations (PHOs), which have been progressively established in response to the government’s Primary Health Strategy (2001) and are responsible for the co-ordination and delivery of primary health services care to defi ned populations.50


54

It should be noted that while nursing homes are classifi ed to health, retirement villages or accommodation for the aged are classifi ed under services for the elderly in social services. In practice it is not always easy to differentiate between rest homes / retirement villages that primarily provide accommodation services and those that provide primarily hospital care services.

There is also the potential for overlap between health and social services with regard to mental health services. Generally speaking, institutions that provide treatment for those experiencing mental health issues are classifi ed within health, while services providing primarily accommodation, information and support to individuals and families are placed within social services.

Key statistics

Table 8.03.01

Number of NPIs employing paid staff 450 9,780 4.6 7





Percentage of all NPIs Rank(2)Health

Health Non-profit Institutions Key statisticsOctober 2005

All NPIs(1)

Table 8.3.01 shows that while health non-profi t institutions make up only 2.3 percent of all non-profi t institutions, paid employees in the health group number more than 15,090 (14 percent of total non-profi t institution employment). There is a strong correlation between paid employment and contribution to GDP, meaning that the health group is the fourth largest contributor to GDP across the 12 non-profi t institution activity groups.

The health activity group’s ranking for number of employees and GDP is high, from relatively few non-profi t institutions. This is explained by the fact that hospitals employ more staff than most other non-profi t institutions. Also, a hospital with more than one location may be counted as a single institution if one specifi c agency operates all locations. Similar comments can be applied to the social services group, in relation to aged care facilities for hospitals.


55


Total income 851,614 100.0






Health Non-profit Institutions

March 2004 year

$(000) Percent


Employment

Table 8.03.02


0 1,770 80.11–5 220 10.96–19 130 6.320–99 70 3.8100+ 30 1.4Total 2,210 100.0


Health Non-profit Institutions

Percentage

By number of employeesOctober 2005

Number of non-profit institutions

Approximately 80 percent of health non-profi t institutions employ no paid staff, which is relatively low compared with the overall non-profi t institution average of 90 percent. Health non-profi t institution providers that do employ paid staff, employ an average of 33.5 staff each. This is the highest of all activity groups.


Table 8.03.03


56

The income of non-profi t institutions in the health group is dominated by sales of goods and services, with four dollars in every fi ve coming from this source. The major component of sales is contract payments from district health boards to non-profi t institutions. Although a proportion of income may be for private treatment, the majority of health care is funded by government. Most government grants to non-market institutions in this activity group are treated as sales of goods and services.

Social services Social services provide the largest contribution to GDP (23 percent) of all the non-profi t activity groups within the NZSCNPO classifi cation. This sizable group includes a vast range of social service providers, emergency and relief services and institutions providing income support and maintenance. Examples are early intervention services, services for the disabled and elderly, food banks, self-help groups and other personal social services such as temporary shelters for refugees. Also included are institutions providing income support and maintenance to those in need.

Many social services are provided by religious institutions – sometimes as stand-alone entities and sometimes as part of an ecclesiastical structure. Iwi-related social services are an important part of this group.

Well over half of the group revolves around community care services, such as accommodation for the aged, and residential and non-residential facilities. There is evidence that private ’for profi t’ agencies are expanding within the aged care service area, however, and are buying out non-profi t aged care facilities.51, 52

It should be noted that while retirement villages or accommodation for the aged are classifi ed under ‘services for the elderly’ in social services, nursing homes are classifi ed to the health activity group. In practice it is not always easy to differentiate between rest homes / retirement villages that primarily provide accommodation services and those that provide primarily hospital care services.

As noted in the previous section, institutions that provide treatment for those experiencing mental health issues are generally classifi ed within health, while services providing primarily accommodation, information and support to individuals and families are classifi ed within the social services group.

Key statistics

Table 8.04.01

51 Service and Food Workers Union, (2005).52 The Methodist Church of New Zealand, (2005).

Number of NPIs employing paid staff 1,750 9,780 17.9 3





Percentage of all NPIsAll NPIs(1)Social services Rank(2)

Social Services Non-profit Institutions

October 2005Key statistics


57

The social services group ranks fi rst across the 12 activity groups in terms of its contribution to GDP (23 percent) and number of employees (30 percent) as a proportion of all non-profi t institutions. Those social service non-profi t institution providers that do employ paid staff, employ an average of 18 staff each. This is signifi cantly above the total non-profi t institution average of 10.8 but not as large as health (33.5).

Employment

Table 8.04.02


0 9,520 84.41–5 930 8.26–19 540 4.820–99 230 2.0100+ 50 0.4Total 11,280 100.0


Social Services Non-profit Institutions By number of employees

October 2005


The majority of non-profi t institutions within social services do not employ paid staff. However, there are a signifi cant number of larger non-profi t institutions within the group that each employ over 20 staff.


58


Table 8.04.03

IncomeSales of goods and services 1,013,297 72.7Interest received 33,854 2.4Dividends received 6,595 0.5Membership, donations and grants(1) 254,032 18.2Government grants(2) 83,306 6.0Insurance claims 3,170 0.2

Total income 1,394,255 100.0






Income and expenditureSocial Services Non-profit Institutions

March 2004 year

$(000) Percent

Payments by government to social service non-profi t institutions have generally been treated as sales in the account. A major component of sales to social services is contract payments from district health boards and other government departments. Many services provided under the government health budget are provided by institutions that are classifi ed to social services. Most government grants to non-market institutions in this activity group are treated as sales of goods and services.

Environment New Zealand has a strong appreciation of environment-focused institutions making a difference in the community. However, the range and diversity of such institutions has made it diffi cult to defi ne just who these institutions are. The NZSCNPO environment group takes a broad view, encompassing all non-profi t institutions that have a direct relationship with wild or domestic plant or animal life, or with the physical environment.

The group is split between the environment subgroup and the animal protection subgroup. The environment subgroup includes institutions that promote pollution abatement and control, natural resource conservation, and the protection and beautifi cation of open spaces. The animal protection subgroup includes institutions concerned with animal protection and welfare, wildlife preservation and veterinary services.


59

Under this defi nition, the environment group is dominated by two types of institutions: those that serve farming interests, and those that are more traditionally associated with environmental and wildlife protection, including animal welfare. This highlights how connected agricultural and environmental interests are in the New Zealand context.

It is important to note that the environment group is fi nancially dominated by the Animal Health Board53

and farmers’ veterinary cooperatives. However, the majority of institutions are those traditionally seen as grassroots environmental or animal welfare groups.

Key statistics:

Table 8.05.01

53 The Animal Health Board is a government and industry contracted organisation that aims to eradicate bovine tuberculosis, primarily through controlling possum populations.

Number of NPIs employing paid staff 110 9,780 1.1 10Number of NPIs not employing paid staff 1,210 87,220 1.4 10Total number of NPIs 1,310 97,000 1.4 10Number of employees 1,020 105,340 1.0 9Contribution to GDP ($000)(3) 39,193 3,640,162 1.1 10



Key statistics

All NPIs(1) Rank(2)Percentage of all NPIs

Environment Non-profit Institutions

Environment

October 2005

Environment is a relatively small group, being slightly greater than 1 percent of the number of institutions, the number of employees, and contribution to GDP for all non-profi t institutions. Much of the contribution to GDP comes from the large employing non-profi t institutions, including national and international environmental institutions, the Animal Health Board, and farmers’ veterinary cooperatives.

Employment

Table 8.05.02


0 1,210 92.41–5 55 4.26–19 30 2.320–99 18 1.4100+ 0 0.0Total 1,310 100.0






60

Table 8.05.02 indicates that while there are 18 institutions employing 20 or more people, environment is very much a grassroots activity group. Ninety-two percent of institutions rely on volunteer labour alone to function, and most of these are community-based environmental protection institutions. There are only 110 institutions (8 percent of the environment group) that employ staff, and most of these institutions are small. Only 4 percent employ six or more people.


Table 8.05.03

IncomeSales of goods and services 124,644 78.4Interest received 2,580 1.6Dividends received 91 0.1Membership, donations and grants(1) 25,798 16.2Government grants(2) 5,650 3.6Insurance claims 187 0.1


ExpenditurePurchases of goods and services(3) 110,650 74.4Compensation of employees 33,659 22.6Taxes on production 213 0.1Donations paid 2,799 1.9Interest payments 1,147 0.8Net insurance premiums 329 0.2





March 2004 year Income and expenditure


$(000) Percent

The primary source of income is the sale of goods and services (78 percent), such as veterinary services to farmers, and disease vector control services to the agricultural industry and government. Donations and government grants, which is income that does not come from contractual arrangements, make up much of the remaining income, primarily going to non-profi t institutions focused on environmental or animal protection.

The majority of expenses are incurred through the purchase of goods and services (72 percent), refl ecting the resource-intensive nature of some of the larger non-profi t institutions. The relatively small contribution of compensation of employees refl ects the comparatively low proportion of paid staff within this group.

Development and housing The institutions in development and housing perform diverse activities largely for the benefi t of the community rather than the benefi t of individuals. Development and housing consists of institutions involved with social, community or economic development; housing; and employment or employment-related training. Social development includes community and neighbourhood institutions such as information centres, neighbourhood watch and hall committees. Housing includes those institutions involved with development,


61

54 http://www.legislation.govt.nz/libraries/contents/om_isapi.dll?clientID=3674035695&infobase=pal_statutes.nfo&jump=a2004-078&softpage=DOC#JUMPDEST_a2004-078

management, and leasing of housing. Homeless shelters and supported housing are included in social services. Employment and training focuses on vocational guidance and training.

Development and housing includes institutions working towards improving the quality of life within communities, the institutional infrastructure and capacity to improve general public well-being. This includes community centres, community development trusts, neighbourhood support groups, employment services, and those tangata whenua governance institutions that manage the affairs of iwi, hapü and marae.

The larger institutions include boards and committees with responsibilities for land, buildings and community assets. Smaller units includes neighbourhood groups and community and information centres.

Tangata whenua governance institutions that provide governance of Mäori are included in the housing and development group. These institutions specifi cally include marae and those groups named in the 2004 Maori Fisheries Act.54 See ‘Tangata whenua governance’, below, for more information.

Development and housing includes tourism boards and business associations that are set up for the purpose of promoting business development in a specifi c geographic area.

Key statistics

Table 8.06.01




Key statistics

All NPIs(1)

Development and Housing Non-profit Institutions

Percentage of all NPIs

Developmentand housing

October 2005

Rank(2)

Development and housing is the fourth largest non-profi t institution activity by number of institutions but is lower ranked by employment and economic contribution. This indicates a large number of small non-employing institutions. Within this activity group, 80 percent of institutions are focused on economic, social and community development while only 4 percent of non-profi t institutions in this group are involved in housing, employment or training. In New Zealand many housing and employment services are managed by central and local government. The non-profi t institutions in this group are predominantly involved in activities providing social rather than economic benefi t. For this reason the economic contribution per institution is low compared with other non-profi t institutions. Because these institutions operate locally, they typically have a lower contribution to GDP per institution than other activity groups whose scope might be wider-ranging.


62

Employment

Table 8.06.02


0 7,020 92.61–5 390 5.16–19 120 1.620–99 35 0.5100+ 3 --Total 7,580 100.0




Development and Housing Non-profit Institutions

The fi nancially larger institutions are predominantly tangata whenua governance institutions while many of those without employment are boards, trusts and committees with responsibility for community resources. Only 2 percent of non-profi t institutions in this group employ six or more paid staff.


Table 8.06.03



ExpenditurePurchases of goods and services(3) 131,054 55.4Compensation of employees 93,135 39.4Taxes on production 688 0.3Donations paid 6,578 2.8Interest payments 3,778 1.6Net insurance premiums 1,194 0.5





Income and expenditureDevelopment and Housing Non-profit Institutions

March 2004 year

$(000) Percent


63

The majority of income is generated from the sale of goods and services. Government grants are the second largest contributor to income, contributing just over one dollar in every four. All payments from government to non-profi t institutions in this group are counted as grants.

Government funding is provided for community resources, for the provision of employment and housing services and compensation payments to Mäori tribes. Non-profi t institutions providing housing and education receive funding from government in the form of contracts while community facilities are often built with government grants.

Tangata whenua governance Background

Early consultation around the NPISA highlighted that the international activity classifi cation (ICNPO) had no provision to recognise the special role of Mäori in New Zealand. In response, Statistics New Zealand put a proposal before a Mäori focus group convened by the Community Sector Taskforce for discussion. The proposal introduced the concept of a new group within the classifi cation named ‘tangata whenua governance’, recognising this activity as governance outside of government and encompassing the ideas of ‘governing of a people’ across the ‘whole of life’. Because this activity is institutionally separate from government and not-for-profi t it is considered to be within the scope of the NPISA.

The Mäori focus group made several observations. They pointed out that the classifi cation was based on a different worldview to that of Mäori and that it failed to recognise the activities of indigenous peoples. The classifi cation was diffi cult to reconcile to their worldview. Similarly, the western defi nition of volunteering is distinct from the Mäori concept of mahi aroha.55,56 The group largely agreed that there was value in including Mäori in the way specifi ed in the proposal, but that the process, and the term tangata whenua governance, was an accommodation made in response to the shortcomings of the classifi cation.

Statistics NZ and the Committee for the Study of the New Zealand Non-profi t Sector agreed to continue to advance this issue at an international level, including fi nding a better way to represent indigenous people and make contacts with other countries.

The working defi nition of ‘tangata whenua governance’ includes iwi organisations mandated by whänau and hapü. It includes other institutions with mandate, ownership or management of tangata whenua such as marae committees.

It should be noted that although tangata whenua governance is a subgroup within the development and housing classifi cation, it is only a subgroup for the purposes of international comparison. Without this addition, tangata whenua governance institutions would have been part of the ‘economic, social and community development’ subgroup. By grouping tangata whenua governance institutions together it is possible to give them a separate profi le and include them with the institutions whose activities are most similar. This preserves the integrity of international comparison. Conceptually however, tangata whenua governance is an important part of New Zealand’s non-profi t activity and can be considered as the thirteenth group in the classifi cation.

Measurement

The units identifi ed as part of tangata whenua governance are limited to those institutions with the text ‘marae’ in their name that are not logically in another NZSCNPO group, for example, a marae health centre. It also includes those institutions listed in the Maori Fisheries Act 2004. This does not include traditional governance structures, such as rünanga, that have existed for hundreds of years. It measures institutions with western governance structures or those that gain visibility within the western worldview.

Tangata whenua governance should not be mistaken to represent all Mäori non-profi t institutions. Mäori non-profi t institutions will be included in the group that best represents their primary activity. Examples include marae health centres (in health), and national Mäori business associations (in business and professional associations, unions).

The institution and employment counts for tangata whenua governance as reported in Counting Non-profi t Institutions in New Zealand: 200557 are in table 8.06.04.

55 Offi ce for the Community and Voluntary Sector (2007), 1.56 Mahi aroha refers to ‘work performed out of love, sympathy or caring and through a sense of duty’, ibid. 57 Statistics New Zealand (2007).


64

Table 8.06.04

Number of NPIs(1) employing paid staff 65 9,780 0.7Number of NPIs not employing paid staff 1,120 87,220 1.3Total number of NPIs 1,180 97,000 1.2Number of employees 850 105,340 0.8

(1) Non-profit institutions.

Key statistics

Percentage of all groupsAll groupsTangata whenua

governance

October 2005

Tangata Whenua Governance Non-profit Institutions

Statistics New Zealand has classifi ed only a small number of institutions to this group, which is refl ected in the key statistics. As further development work refi nes the defi nition and expands the population the statistics will better refl ect the true nature of this activity.

Other institutions that fall under tangata whenua governance could include:

● all marae (currently classifi ed elsewhere in the account)

● institutions similar to those in the Maori Fisheries Act 2004 from tribes that were not party to that Act

● institutions in other activity groups that better fi t within the tangata whenua governance activity group.

Internationally this is the fi rst attempt to represent the specifi c governance activity of indigenous people within a non-profi t institution satellite account. This work provides a model for other countries to consider when approaching the representation of indigenous peoples.

Law, advocacy and politics Non-profi t institutions within law, advocacy and politics have their primary activity in the promotion of the interests of groups within society, ranging from ethnic associations to community law centres to political parties. The particular focus of institutions within law, advocacy and politics is to give a group representation within the public arena – providing benefi ts such as social cohesion, legal protection, or a voice to parts of society that may not be well represented otherwise. While many non-profi t institutions advocate, provide legal services or have political agendas, this may not be their primary activity. In such cases they may be found elsewhere, for example within the social services group or the environment group.

There are diverse non-profi t institutions in law, advocacy and politics. Most of these are part of the civic and advocacy subgroup, and include special-interest advocacy institutions, ethnic associations, students’ associations, and driver service associations such as the New Zealand Automobile Association. The law and legal services subgroup comprises prisoners’ aid institutions and community legal centres, as well as consumer advocacy institutions. The subgroup of political institutions is relatively small and follows the political cycle, meaning that fi nancial fl ows fl uctuate considerably from year to year.

Ethnic associations promote the interests of or provide services to members belonging to a specifi c ethnic heritage. This includes institutions such as Scottish societies or Pacifi c community groups which focus on national or regional culture.


65

Key statistics

Table 8.07.01




Key statistics


Law, Advocacy and Politics Non-profit Institutions

Rank(2)

October 2005

Percentage of all NPIsAll NPIs(1)

Although law, advocacy and politics is a diverse group, it is relatively small when compared with the total number of non-profi t institutions. It represents 2 to 3 percent of all non-profi t institutions across all key statistics including the number of non-profi t institutions, number of employees, and contribution to GDP.

Employment

Table 8.07.02


0 2,280 91.21–5 150 6.06–19 50 2.020–99 6 0.2100+ 3 0.1Total 2,500 100.0


Law, Advocacy and Politics Non-profit Institutions



Ninety-one percent of non-profi t institutions in law, advocacy and politics employ no staff. These are usually trusts or foundations who primarily advocate, lobby, or otherwise advance the interests of a specifi c group. Institutions employing one to fi ve staff are usually regional special interest or crisis intervention groups, their small size refl ecting the specifi c focus of these institutions. Institutions employing six to 19 staff include community law centres, smaller students’ associations, and ethnic associations. Larger students’ and ethnic associations employ between 20 and 99 staff, as do nationally based advocacy or protection societies. Institutions with 100 or more staff are national bodies providing a signifi cant range of services to their members, with advocacy considered to be their primary activity.


66

58 Refer to chapter 3 – Market and non market non-profi t institutions.


Table 8.07.03

IncomeSales of goods and services 124,816 64.1Interest received 4,417 2.3Dividends received 1,688 0.9Membership, donations and grants(1) 51,615 26.5Government grants(2) 11,817 6.1Insurance claims 308 0.2







Income and expenditureLaw, Advocacy and Politics Non-profit Institutions

March 2004 year

$(000) Percent

Sales of good and services are mainly contracts to government departments and membership fees of market non-profi t institutions.58 Donations, memberships and grants, as well as government grants, mainly go to small and medium-sized institutions. Expenses are split between purchases of goods and services (54 percent) and compensation of employees (43 percent).

Grant making, fundraising and voluntarism promotion Grant making, fundraising and voluntarism promotion has the third largest economic contribution to non-profi t institution activities, contributing $566 million (15 percent) to the value of the New Zealand economy. Grant making foundations have signifi cant fi nancial fl ows and include community trusts, gaming trusts and various other philanthropic trusts. These are institutions that focus solely on managing and distributing funds to community groups. This activity group also includes fundraising institutions that have similar attributes to grant making institutions. The main difference is that a unit is classifi ed as a fundraiser if they raise funds for one specifi c authorised purpose, while an institution is classifi ed as a grant maker if they distribute their funds to various purposes. Voluntarism promotion includes institutions that recruit, train and place volunteers while promoting volunteering generally.


67

Key statistics

Table 8.08.01

Number of NPIs employing paid staff 80 9,780 0.8 11Number of NPIs not employing paid staff 540 87,220 0.6 11Total number of NPIs 610 97,000 0.6 11Number of employees 570 105,340 0.5 11Contribution to GDP ($000)(3) 565,754 3,640,162 15.5 3



Grant making, fundraising and

voluntarismpromotion

Key statistics

Rank(2)All NPIs(1)

Grant making, Fundraising and Voluntarism Promotion Non-profit Institutions

Percentage of all NPIs

October 2005

Grant making, fundraising and voluntarism promotion is the second smallest activity group by number of non-profi t institutions and number of employees, but is the third largest group in terms of GDP contribution. This indicates that each non-profi t institution and each employee is generating value-added (that is, contribution to GDP), which is signifi cantly larger than the average for all non-profi t institutions. This group includes less than 1 percent of paid staff across all non-profi t institutions, but the group nevertheless contributes 15 percent to the total non-profi t institution GDP.

The largest institutions in this group are classifi ed under the grant making foundation subgroup. Fundraising and voluntarism have little impact on the overall group’s contribution to GDP.

Employment

Table 8.08.02


0 540 88.51–5 55 9.06–19 15 2.520–99 6 1.0100+ 0 0.0Total 610 100.0





Approximately eight out of every nine non-profi t institutions (89 percent) in this group employ no paid staff. Of those that do, the majority employ one to fi ve staff members, while only 1 percent of non-profi t institutions in this group employ 20 or more staff.


68


Table 8.08.03

IncomeSales of goods and services 688,688 69.5Interest received 147,178 14.8Dividends received 94,204 9.5Membership, donations and grants(1) 56,166 5.7Government grants(2) 4,545 0.5Insurance claims 450 0.0


ExpenditurePurchases of goods and services(3) 152,817 18.5Compensation of employees 15,624 1.9Taxes on production 181,071 22.0Donations paid 462,063 56.0Interest payments 12,334 1.5Net insurance premiums 794 0.1






March 2004 year

$(000) Percent


The biggest sources of income for non-profi t institutions in this activity group are the proceeds from gaming machines (classifi ed as sales of goods and services) and interest on investments. Many trusts rely on interest generated from large lump sum investments to sustain their grant making programmes. These may be established and guided by statute, like the community trusts,59 or by personal or corporate endowment.

A feature of this group is the large number of donations that it makes to other institutions. This includes the distribution of profi ts from gaming machines, and the distributions from grant making schemes run by non-profi t institutions.

International The activities of institutions with an international focus are often highlighted in the wake of high profi le tragedies, such as natural disasters, providing aid to refugees and the injured. However, the activities of international institutions go beyond emergency aid and relief. They also include development assistance associations, friendship and exchange programmes, international human rights and peace advocates.

The international activity group only includes those institutions focused on activity internationally, not in New Zealand. This means most of the institutions classifi ed here are national bodies. Many entities will have several institutions including a national body and several local branches.

59 Now acting under the Community Trust Act 1999.


69

Key statistics

Table 8.09.01

Number of NPIs employing paid staff 45 9,780 0.5 12Number of NPIs not employing paid staff 260 87,220 0.3 12Total number of NPIs 300 97,000 0.3 12Number of employees 560 105,340 0.5 12Contribution to GDP ($000)(3) 21,624 3,640,162 0.6 12



October 2005

International Percentage of all NPIs

Key statistics

Rank(2)

International Non-profit Institutions

All NPIs(1)

The international group is the smallest of the activity groups across all measures. Although the group is not concerned exclusively with aid and relief, it is these institutions that make the biggest fi nancial impact. In years with high profi le international disasters the fi nancial activity of this group can increase signifi cantly as large amounts of personal and corporate donations are given.

The low level of GDP contribution refl ects the nature of the international activity. In general the funds raised in New Zealand are employed in the production of goods and services overseas. These institutions receive substantial donations from New Zealanders but these funds do not increase the production value of the New Zealand economy.

Employment

Table 8.09.02


0 260 86.71–5 25 8.36–19 9 3.020–99 9 3.0100+ 0 0.0Total 300 100.0


International Non-profit Institutions




70

Paid employment is low and often consists predominantly of those involved in the roles of administration and fundraising. Eighty-seven percent of all international non-profi t institutions do not employ paid staff, which is similar to the total non-profi t institution average of 90 percent.

Income and expenses

Table 8.09.03



ExpenditurePurchases of goods and services(3) 29,708 26.0Compensation of employees 18,695 16.4Taxes on production 57 0.0Donations paid 65,641 57.4Interest payments 108 0.1Net insurance premiums 63 0.1





March 2004 year

$(000) Percent

Income and expenditureInternational Non-profit Institutions

The income and expenditure for the international group presents a signifi cantly different picture from other activity groups. The major source of income is from donations, and income from the sales of goods and services is minor in comparison. Likewise, donations paid to assist in overseas aid is the major expense contributing to the total.

Many institutions within this group are major conduits of aid, both ongoing and for one-off disasters or emergencies. Their activities are partially funded by, and they work collaboratively with, New Zealand’s International Aid and Development Agency (NZAID).60 NZAID is the New Zealand government’s international aid and development agency. It was established in 2002, and is responsible for delivering New Zealand’s Offi cial Development Assistance and for advising Ministers on development assistance policy and operations.61 In the 2004/05 fi nancial year, NZAID distributed $297 million of which $19 million (6 percent) was given to New Zealand institutions.62

60 http://www.nzaid.govt.nz/61 http://www.nzaid.govt.nz/about/62 NZAID (2005), 21.


71

Religion

Religious worship is one of the few areas of society in which all institutions are non-profi t. Religion non-profi t institutions are outnumbered by only the culture and recreation and social services activity groups. The contribution of religious bodies goes beyond worship and proclamation. Religion includes all institutions that promote or administer religious services and rituals, such as churches, temples and their governing bodies. It includes also those supporting services such as missionary societies, evangelistic groups like open air campaigners, units distributing religious material and centres for religious education outside of the education activity group.

The social and economic infl uence of religious institutions extends into other activities such as education, health and social services, where many institutions have clear religious affi liation. In many cases, involvement in these other activities is one aspect of their worship and could be considered religious activity. However, where a separate institution has been set up for the purpose of education, health or to provide social services, it is recognised within the activity of education, health or social services respectively. In education and research, 7.5 percent of institutions on Statistics New Zealand’s Business Frame63 had names that clearly identifi ed them as being affi liated with a religious body. This number was almost 10 percent in social services. The true level of religious affi liation may be much higher than that reported but this cannot be confi rmed from the data sources.

Key statistics

Table 8.10.01

63 Refer to chapter 9 – Terms and defi nitions.

Number of NPIs employing paid staff 1,910 9,780 19.5 2Number of NPIs not employing paid staff 7,980 87,220 9.1 3Total number of NPIs 9,890 97,000 10.2 3Number of employees 9,390 105,340 8.9 5Contribution to GDP ($000)(3) 287,151 3,640,162 7.9 6



Key statistics

Rank(2)Religion Percentage of all NPIsAll NPIs(1)

Religion Non-profit Institutions

October 2005

Religion has the second largest number of institutions employing staff but only the fi fth largest number of employees. The economic contribution of religion is 8 percent of all non-profi t activity.

Almost 70 percent of the contribution to GDP from the religion group comes from local places of worship. Regional and national administrative bodies add a further 20 percent while associated institutions contribute the remaining 10 percent.

Although many non-profi t institutions are small, the cumulative effect of so many local places of worship is substantial. Unlike for other religious movements, the administrative arm of the Christian church is also economically signifi cant because of its size. In many cases the economic activity undertaken by Christian institutions is on behalf of large numbers of local churches and its size is not surprising. The complex management structures of this group refl ect the fact that many Christian institutions predate current legal forms.


72

Employment

Table 8.10.02


0 7,980 80.71–5 1,580 16.06–19 260 2.620–99 60 0.6100+ 9 0.1Total 9,890 100.0


Religion Non-profit Institutions



A key feature of religious institutions is the large number of small employers. Nineteen percent of religious institutions employ paid staff – the third largest ratio across all activity groups. Despite the density of employment being low there are still a number of very large institutions employing in excess of 100 paid staff. This includes church denominations where compensation of employees is paid from a central body rather than from the local church.


73


Table 8.10.03

Religious activity relies heavily on the donations and bequests of individuals. Seventy-one percent of all income is in the form of donations compared with 24 percent for all non-profi t institutions. These donations come almost exclusively from households. Government does however play a role in the funding of religion as it does in all charitable institutions. This is done indirectly through the donations rebate administered by Inland Revenue. Any donations made to a registered donee institution are eligible for a one-third rebate, to a maximum rebate of $630 annually per individual.

Surpluses generally go towards funding new capital projects to build and improve land and buildings or as risk mitigation against the variability of personal donations. Many churches have permanent long-term building programmes.








Income and expenditureReligion Non-profit Institutions

March 2004 year

$(000) Percent


74

Religious affi liation

Data from the 2006 Census showed an increase in the diversity of religious affi liation. It also showed an increasing proportion of individuals who did not affi liate with a religion when compared with the previous census.

Table 8.10.04

ChristianAnglican 554,925Catholic 508,437Presbyterian, Congregational and Reformed 400,839Christian not further defined 186,234Methodist 121,806Pentecostal 79,155Baptist 56,913Latter-day Saints 43,536Other Christian 108,924Total people, Christian 2,027,418Mäori Christian 65,550

Other religionsBuddhist 52,365Hindu 64,392Islam/Muslim 36,072Judaism/Jewish 6,858Spiritualism and new age religions 19,800Other other religions 24,450

No religion 1,297,104Object to answering 242,610Total people stated 3,743,652Total people, not elsewhere included(2) 292,974Total people 4,027,947

(1) Includes all of the people who stated each religious affiliation, whether as their only religious affiliation or as one of several religious affliations.Where a person reported more than one religious affiliation they have been counted in each applicable group.(2) Includes don't know, religion unidentifiable, response outside scope and not stated.

Religious Affiliation2006 Census

AffiliationTotal

respondents


75

Number of places of worship

Anglican 382

Catholic 296

Presbyterian 424Cooperative parishes(2) 217

Other ChristianLatter Day Saints 132

Jehovah's Witness 171

Brethren 204

Seventh Day Adventist 83

Salvation Army 146

Congregational and Reformed 27

Lutheran 18

Methodist 198

PentecostalAssembly of God 227

New Life Centre 100

Apostolic 70

Elim 47

Associated Church of Christ 40

Vineyard 27

Destiny 14

Baptist 259

Buddhist 64

Bahai 47

Islam/Muslim 27

Judaism/Jewish 11

(1) The table does not include all religious movements and Christian denominations operating New Zealand.

(2) May be included in other totals.

Affiliation

Place of Worship(1)

By religious affiliation

Places of worship

The number of places of worship is reported by many national bodies of Christian denominations and other religious movements. In some cases a central register will report specifi c locations. Statistics NZ identifi ed 3,068 places of worship, not including 27 national bodies affi liated with a denomination or religious movement. Vision Network64 maintains a directory of 2,70865 churches (a location of worship). Adding in other churches commonly affi liated with Christianity, and other religious bodies such as temples or shrines, brings the total number of places of worship to 3,068.

Table 8.10.05

64 www.visionnetwork.org.nz65 March 2006.


76

Business and professional associations, unions The business and professional associations, unions group brings together three distinct types of membership institutions. The commonality lies in the roles they play in promoting, regulating and protecting the interests of their member constituents. It includes institutions that promote, regulate and safeguard interests of businesses, professionals and workers, such as trade unions and chambers of commerce. Although this is one of the smaller activity groups, the infl uence of these institutions touches all areas of employment.

Business associations work to promote special branches of business. Their members are primarily from institutions, or individuals representing institutions in their professional capacity. Business associations may have a regulatory function and often include professional registration boards.

In contrast, professional associations focus on supporting individuals whose commonality is their professional role. The activities of professional associations include marketing, research, industry and goods promotion, industry training, public relations and lobbying as well as some statutory obligations undertaken under Acts of Parliament.

Trade unions are similar to professional associations but their focus is on individuals as employees in a specifi c industry.

It is worth noting that development and housing also includes some business associations, including associations set up for the purpose of promoting business development in a specifi c geographic area. The activity of these groups is one of economic development not the protection of a specifi c branch of business.

Key statistics

Table 8.11.01




Rank(2)

Business and professionalassociations,

unions

All NPIs(1) Percentage of all NPIs

Business and Professional Associations, Unions Non-profit InstitutionsKey statisticsOctober 2005

Business and professional associations, unions ranks either sixth or seventh on all of the key indicators. They make up 3 percent of both the total number of non-profi t institutions and the total number of paid employees and contribute 5 percent to the total non-profi t institution GDP. This indicates a greater than average per employee contribution to GDP.


77

Employment

Table 8.11.02


0 2,660 85.01–5 350 11.26–19 90 2.920–99 30 1.0100+ 6 0.2Total 3,130 100.0


Business and Professional Associations, Unions Non-profit Institutions



As with all activity groups the signifi cant majority of non-profi t institutions do not employ paid staff. Only 4 percent of organisations employ six or more paid staff.

Income and expenses

Table 8.11.03








Income and expenditureBusiness and Professional Associations, Unions Non-profit Institutions

March 2004 year

Percent$(000)


78

Three-quarters of the income for business and professional associations and unions comes from the sale of goods and services. Donations, memberships and grants provide 17 percent of the income. All payments from government to institutions in this group are treated as grants.

Trade unions rely heavily on membership subscriptions, with 90 percent of their income coming from this source.

Union membership

Table 8.11.04

1991 514,325 661992 428,160 581993 409,112 671994 375,906 821995 362,200 821996 338,967 831997 327,800 801998 306,687 831999 302,405 822000 318,519 1342001 329,919 1652002 334,783 1742003 341,631 1812004 354,058 1702005 377,348 175

Source: Leda Blackwood, Goldie Feinberg-Danieli and George Lafferty Unions and Union Membership in New Zealand (Annual Review for 2005)

Number of unionsUnion membership

Unions and Union MembershipDecember

Not elsewhere classified Not elsewhere classifi ed consists of institutions not clearly defi ned or closely related to any activities that are carried out by other non-profi t institutions. This is a residual group of non-profi t institutions that have not been classifi ed to any other activity group.

66 http://rangi.knowledge-basket.co.nz/gpacts/public/text/1991/an/022.html67 http://rangi.knowledge-basket.co.nz/gpacts/public/text/2000/an/024.html


79

Key statistics

Table 8.12.01

Number of NPIs employing paid staff 150 9,780 1.5 9Number of NPIs not employing paid staff 7,410 87,220 8.5 4Total number of NPIs 7,560 97,000 7.8 5Number of employees 640 105,340 0.6 10Contribution to GDP ($000)(3) 29,301 3,640,162 0.8 11



Not Elsewhere Classified Non-profit Institutions

Rank(2)Not elsewhere classified All NPIs(1) Percentage of all

NPIs

Key statisticsOctober 2005

These statistics indicate that the residual group is not very signifi cant, as most non-profi t institutions could be accurately allocated to a specifi c activity group.

While this group contains 8 percent of non-profi t institutions, the number of comparatively large non-profi t institutions in this group is smaller. Of non-profi t institutions listed on Statistics New Zealand’s Business Frame,68 less than 3 percent remain in the not elsewhere classifi ed group, because in most cases information could not be obtained to accurately allow the allocation of these institutions to a specifi c group.

Non-profi t institutions remaining in the not elsewhere classifi ed group are those where either their activity is truly different to those included under any of the other 11 main groups or where there is insuffi cient information about them available to allow coding.

Table 8.12.01 shows that only 2 percent of non-profi t institutions in this group employ paid staff. This is the lowest percentage across all activity groups, refl ecting the fact that non-profi t institutions with paid employees will generally be larger and easier to directly allocate to one of the other 11 activity groups.

68 Refer to Chapter 9 – Terms and defi nitions.


80


Table 8.12.02








$(000)

Income and expenditureNot Elsewhere Classified Non-profit Institutions

March 2004 year

Percent


81

9 Technical information

Defining non-profit institutionsThe United Nations (UN) structural-operational defi nition brings together those entities that meet the following fi ve criteria:

● are organised to the extent that they can be separately identifi ed

● are not for profi t and do not distribute any surplus they may generate to those who own or control them

● are institutionally separate from government

● are in control of their own destiny, and

● are non-compulsory in both terms of membership and members’ input.

To be included in the Non-profi t Institutions Satellite Account (NPISA), an institution has to meet all fi ve criteria. Each criterion is elaborated on briefl y, as follows, and the decision trees related to each are presented in appendix 1. For a full discussion on the issues concerning the defi nition of non-profi t institutions, refer to the Statistics New Zealand publication, Identifying Non-profi t Institutions in New Zealand.69

Criterion 1: Organisation

Organisation means that the entity has “some degree of internal organisational structure; persistence of goals, structure and activities; meaningful organisational boundaries; or a legal charter of incorporation”.70 Thus a non-profi t institution must be created by process of law such that its existence is recognised independently of the persons, corporations or government units that establish, fi nance or control it, or, if it does not have any legal status, its separate existence must be recognised by society in some formal way. Excluded are purely ad hoc and temporary gatherings of people with no real structure or organised separate identity.

Criterion 2: Not for profi t

Not for profi t means that institutions do not exist primarily to generate profi ts, either directly or indirectly, and are not primarily guided by commercial goals and considerations.71 Under this criterion, members are not permitted to gain fi nancially from the institution’s operations and cannot appropriate any surplus which it may make. This does not imply that a non-profi t institution cannot make an operating surplus on its production, rather that any surplus must be ploughed back into the basic mission of the institution and not distributed to the owners, members, founders or governing board. In this sense, “NPIs may be profi t-making but they are non-profi t distributing, which differentiates non-profi t institutions from for-profi t businesses”.72 If the surplus is distributed to another non-profi t institution, the fi rst is still a non-profi t institution under the not-for-profi t criterion because the surplus remains within the non-profi t institution sector to be used for charitable and other not-for-profi t purposes.

Criterion 3: Institutionally separate from government

This criterion means that an institution “is not part of the apparatus of government and does not exercise governmental authority in its own right”.73 Thus it has an institutional identity separate from the state such that it is not an instrument of any unit of government, central or local.

Criterion 4: Self-governing

This criterion means that “the organisation is able to control its own activities and is not under the effective control of any other entity”.74 Thus the institution has to be independent not only of government but of other entities as well.

69 Statistics New Zealand (April 2006).70 United Nations (2003), 2.15.71 Ibid, 2.16.72 Ibid.73 United Nations (2003), 2.17.74 Ibid, 2.18


82

Criterion 5: Non-compulsory

“Non-compulsory means that membership and contributions of time and money are not enforced by law or otherwise made a condition of citizenship”.75 Thus this criterion emphasises the voluntary nature of non-profi t institutions with regard to both membership and contribution.

As far as is known, there are no private non-profi t institutions in New Zealand where citizenship is a condition of membership. However, there are some circumstances where, if a person wishes to practice a trade or profession or course of study, the compulsory membership of a non-profi t institution is required. For example, at each of New Zealand’s universities it is compulsory for students to belong to their local student association. The UN defi nition permits these institutions to be in-scope on the basis that the situations where people fi nd themselves compelled to join are freely chosen.

Classification of non-profit institutions The United Nations Handbook on Non-Profi t Institutions in the System of National Accounts recommends the International Classifi cation of Non-Profi t Organizations (ICNPO), as a tool to differentiate between the various types of institutions that have been defi ned as non-profi t institutions. This is primarily done based on their ‘economic activity’, as is the International Standard Industrial Classifi cation (ISIC) on which ICNPO is based. Some purpose criteria have been included where activities are similar. By grouping together institutions in this way, a basis for meaningful data analysis is formed.

The main ICNPO groups are as follows:


● Education

● Health

● Social services

● Environment



● Philanthropic intermediaries and voluntarism promotion

● International

● Religion


● Not elsewhere classifi ed

The full classifi cation (groups and subgroups) of the New Zealand adaptation of this international classifi cation, the New Zealand Standard Classifi cation of Non-profi t Organisations (NZSCNPO), can be found in appendix 2.

As the ICNPO is mainly an activity based classifi cation, there are no specifi c categories for population groups such as women or people with disabilities. Many Mäori groups fi t within the criteria of a non-profi t institution and will be included in the NPISA. Institutions targeting these populations are categorised based on the predominant activity of the institution. For example, if an institution provides medical treatment of a disability then it is coded to the health group. If, instead, it provides social assistance for people with disabilities then it comes under the social services group.

Many non-profi t institutions have multiple activities, each falling under separate ICNPO groups, but they can only be classifi ed in one group. In these cases the institution’s ‘primary economic activity’ is used to assign an appropriate ICNPO category. It is usually measured as the activity with the largest share of:

a. value-added – a measure of the institution’s contribution to gross domestic product

b. gross output, if value-added is not available

c. employment, if neither value-added nor gross output is available.

75 Ibid, 2.19.


83

Classifying non-profi t institutions in the satellite account

For the Statistics NZ Business Frame population the initial classifi cation was done using a concordance with the Australian and New Zealand Standard Industrial Classifi cation (ANZSIC) 1996. For example, preschool education (ANZSIC N8410) is concorded with early childhood education (NZSCNPO 2 110), hospitals (ANZSIC O8611) with hospitals and rehabilitation (NZSCNPO 3 100) and residential property owners (ANZSIC L7711) with housing (NZSCNPO 6 200). It should also be noted that where a non-profi t institution carries out two or more distinct activities, its ANZSIC code is that of the majority activity.

For unallocated institutions from this fi rst analysis, extensive keyword search lists were applied. Although several hundred keywords (for example ‘tennis’ and ‘church’) have been used, the list is still not exhaustive. Finally, manual classifi cations were made for the largest institutions (in terms of sales of goods and services) that remained, and for those units where their activity was known. After all these steps were completed, the number of non-profi t institutions from the Business Frame remaining in the not elsewhere classifi ed group is below 3 percent.

For those institutions added from the Inland Revenue administrative database and the Companies Offi ce registers the overall method was similar. The ANZSIC-NZSCNPO concordance was applied if an Inland Revenue ANZSIC tag was available. For the remainder the keyword analysis was applied.

A further allocation was then based on the results of the manual classifi cation of a 10 percent sample of not elsewhere classifi ed non-profi t institutions, using the name of the institution. A further two-thirds of institutions in this group could be coded. The institutions that remain uncoded are those where either their activity is truly different to those included under any of the other 11 main groups or where insuffi cient information about them is available to allow coding.

Keyword coding was applied where no industrial code was available, that is for the whole of the non-Business Frame population and some of the Business Frame population. Where multiple keywords are in the name, a precedence list was applied. For example, ‘The Church of XYZ Tennis Club’ would be classifi ed to sports institutions because in the use of keywords ‘tennis’ is given a higher classifi cation ranking than ‘church’.

It is diffi cult to identify the sometimes very specifi c non-profi t institutions in some of the NZSCNPO subgroups, for example the income support and maintenance subgroup or the employment and training subgroup. An undercount in those subgroups is likely, because some institutions may have been coded to the overarching groups of social services or development and housing instead, based on their industry code or keywords. Therefore the results of the subgroup counts need to be interpreted with caution. In contrast, the results at the main group level are far more robust. A further point to note is precisely what institutions and activities are included under each subgroup. For example, the fundraising subgroup includes large, nationally active institutions with fundraising as their main activity, whereas institutions fundraising to support a specifi c activity covered under one of the other main groups will be coded to ’support and ancillary services’ under this respective group. A second example is that rest homes and other aged residential care (except nursing homes that provide fi rst and foremost medical services) are under social services, not under the health subgroup of nursing homes.

Market and non-market non-profit institutionsA ‘market’ producer is an institution that sells its goods or services at competitive market (or ‘economically signifi cant’) prices. Most non-profi t institutions are classifi ed as ‘non-market’ because they provide their services for free or below market prices. A signifi cant number of non-profi t institutions are market producers however, and are included in the non-profi t institution population as long as they meet the structural-operational defi nition.

Examples of non-profi t institutions that are classifi ed as market producers include:

● most business associations

● gaming trusts

● most non-profi t institution hospitals

● racing clubs.


84

These units are distinctive within the non-profi t institution population. To generate a positive operating surplus, these institutions need to sell their output at market prices. At the same time they meet the legal requirements of being not for profi t because the surplus is generally not retained within the institution, but is distributed to another non-profi t institution or charitable purpose.

Business associations are classifi ed as market producers where they are fi nanced by dues and subscriptions rather than by government. The rationale is that business associations are non-profi t institutions that support market producers.

Gaming trusts need to produce large operating surpluses in order to make community grants. Because of this, they are implicitly assumed to be charging economically signifi cant prices, even though the market in which they operate is heavily regulated. Similar comments apply to racing clubs, although in their case any operating surplus is provided back to industry participants (through such measures as increased stakes).

Most hospitals are classifi ed as market producers because they charge what are considered to be market, or close to market, prices. They would be classed as non-market where they are clearly charging below market rates, for example, free hospitals where staff are volunteers.

Many non-profi t institutions rely on government funding that is contested. Non-profi t institutions receiving funding from government, on the basis of winning contested contracts with government, are not necessarily market producers. If they have a signifi cant volunteer labour component, they may be able to charge out their services at below market rates.

From these examples it should be apparent that, in practice, whether or not a non-profi t institution should be classifi ed as market is not always immediately obvious. If it is unclear whether economically signifi cant prices are being charged by the unit, but it is making a positive operating surplus over time, then that is usually taken as implying that the unit is operating on a market basis. By applying these principles it is possible to come up with an acceptable set of market and non-market classifi cations for the non-profi t institution population.

A market and non-market split also allows for better comparisons with non-profi t institution satellite accounts of other countries. Countries such as Canada have a ‘core’ set of non-profi t institution satellite accounts and a ‘non-core’ set of accounts. The non-core set includes hospitals, universities and colleges. The non-core estimates were provided separately because hospitals were very signifi cant within the Canadian non-profi t institution account. The core Canadian accounts appear to be reasonably comparable with the New Zealand non-market estimates.76 In the Australian non-profi t institution estimates, hospitality clubs and business and professional associations are treated as market producers.77

Data sources and methods

Counting the number of non-profi t institutions

Business Frame population

The primary source of information for counting the number of non-profi t institutions is Statistics New Zealand’s Business Frame, which identifi es enterprises. For an enterprise to be on the Business Frame it must meet any of certain criteria, the most relevant of which, for the count of non-profi t institutions, are:

● annual goods and services tax (GST) expenses or sales of more than $30,000

● an employment count greater than zero

● IR10 income (rent received, interest and dividends and total income) greater than $40,000.

A snapshot of the Business Frame was obtained for the fi rst week of October 2005. This date was chosen to match with the other major data sources used, being the most recent date for which consistent data was available across all three sources.

76 Statistics Canada (2006), 8. 77 Australian Bureau of Statistics (2002), 24.


85

The Business Frame classifi cations used to identify non-profi t institutions included:

● business type

● institutional sector (NZISC)

● industrial activity (ANZSIC 96).

See ‘Terms and defi nitions’ for an explanation of the classifi cations.

At the highest level the NZISC recognises fi ve distinct sectors:

1. non-fi nancial producer enterprises

2. fi nancial enterprises

3. general government

4. non-profi t institutions serving households

5. households.

All of sector 4 was in scope for the count in this report by default. Incorporated societies in other sectors (for example racing clubs, business associations and industry training organisations) were, unless under government control, also included by defi nition. Unincorporated associations in other sectors were assessed by industry to determine whether they were non-profi t institutions. Also included were charitable companies but trading or family trusts, which made up the majority of trusts, were excluded.

Non-Business Frame population

Because the Business Frame only includes non-profi t institutions that pass one of the size thresholds listed above, other sources were required for the thousands of institutions that do not meet these criteria. The two main sources of information used for these smaller institutions were administrative databases maintained by Inland Revenue and the Companies Offi ce lists of incorporated societies and charitable trusts.

From the administrative databases maintained by Inland Revenue, institutions potentially in scope were those classifi ed as qualifying trusts, incorporated societies and unincorporated associations. Added to these, the Companies Offi ce provided a list of charitable trusts and incorporated societies on their registers as at the end of September 2005.

Reconciling the populations

The institutions from the three (overlapping) population sources were integrated and reconciled. A hierarchical approach was initially taken to remove institutions duplicated in the overall list. For example, those institutions that were in the Business Frame population were removed from all other population subsets because the Business Frame provides the most information. Secondly, the Companies Offi ce registers of incorporated societies and charitable trusts took precedence over the administrative databases maintained by Inland Revenue.

Beyond this, other methods employed included name matching and ‘fuzzy’ matching where only high probability matches were implemented. Fuzzy matching is a search function enabling names of institutions to be grouped according to whether they have a high probability match, a medium probability match or some other possibility. The need for such matches arises from the name of an institution being on two or more lists but with different formatting, spelling or completeness.


86

Table 9.01

SNA(2)-based Extension 1(3)SNA(2)-basedplus extension

1Extension 2(4) Total

Production accountGross output 7,119,834 82,235 7,202,068 3,311,970 10,514,038

Sales of goods and services 4,869,708 … 4,869,708 … 4,869,708 Non-market output provided free 2,250,125 82,235 2,332,360 3,311,970 5,644,329

Intermediate consumption 3,479,672 … 3,479,672 … 3,479,672Value-added 3,640,162 82,235 3,722,396 3,311,970 7,034,366

Compensation of employees 2,611,090 … 2,611,090 … 2,611,090 Volunteer labour valuation … … … 3,311,970 3,311,970 Taxes on production 227,676 … 227,676 … 227,676 Consumption of fixed capital 401,680 … 401,680 … 401,680 Operating surplus 399,715 82,235 481,950 … 481,950

Income and outlay accountIncome 3,566,252 82,235 3,648,487 3,311,970 6,960,456

Operating surplus 399,715 82,235 481,950 … 481,950Investment income 478,107 … 478,107 … 478,107 Interest received 345,971 … 345,971 … 345,971 Dividends received 132,135 … 132,135 … 132,135Current transfers 2,688,430 … 2,688,430 3,311,970 6,000,400 Donations received 1,905,396 … 1,905,396 3,311,970 5,217,365 Government grants 758,829 … 758,829 … 758,829 Net non-life insurance claims 24,206 … 24,206 … 24,206Outlays 3,073,831 82,235 3,156,066 3,311,970 6,468,036 Donations paid 684,746 … 684,746 … 684,746 Net non-life insurance premiums 42,691 … 42,691 … 42,691 Interest payments 96,270 … 96,270 … 96,270 Non-market output provided free 2,250,125 82,235 2,332,360 3,311,970 5,644,329Savings 492,421 … 492,421 … 492,421

Capital accountSource of funds

Savings 492,421 … 492,421 … 492,421 Consumption of fixed capital 401,680 … 401,680 … 401,680Capital accumulation 628,056 … 628,056 … 628,056Net lending/borrowing 266,045 … 266,045 … 266,045

(1) Individual figures may not sum to totals due to rounding.(2) System of Natonal Accounts.(3) Includes a calculation of non-market output provided free for market units.(4) Includes valuation of volunteer labour.


Non-profit Institutions Satellite Account and Extensions, in Summary Form(1)

$(000)Non-profit institutions satellite account

2004

Limitations of the data

As the study of the Masterton District Council revealed (refer to chapter 4), the number of non-profi t institutions identifi ed may still be under-counted. On the other hand, it may also be overstated through the failure to remove all duplicates from the various registers and the inclusion, because of not having full information, of institutions that do not meet the full defi nition of a non-profi t institution.

Moreover, the Inland Revenue and Companies Offi ce registers are maintained for non-statistical purposes, therefore registered institutions may not be ceased at the same time as they are on Statistics New Zealand’s Business Frame. Furthermore, the administrative databases maintained by Inland Revenue do not easily allow charitable trusts to be distinguished from trading or family trusts. To identify charitable trusts, the analysis therefore relied on the Companies Offi ce register.


87

The administrative databases maintained by Inland Revenue have many thousands of institutions listed as unincorporated associations. For a large number of these, no associated tax data exists, such as GST sales or purchases. It was possible to verify that a small number of non-profi t institutions report GST as part of a group return. Therefore, although the individual non-profi t institution is recorded with zero GST, it is nevertheless still active. For many other small non-profi t institutions, however, it is not known if they are actively operating or if they simply retain a listing on the administrative databases maintained by Inland Revenue because they have an Inland Revenue number. It is therefore possible that the number of unincorporated associations is overstated.

Counting employment numbers

The head count of salary and wage earners is sourced from taxation data on a monthly basis. The employment count is obtained primarily from administrative databases maintained by Inland Revenue.

Annual Enterprise Survey

The Annual Enterprise Survey provides fi nancial information by industry and sector groups. This includes measures of fi nancial performance and fi nancial position. Output variables include income, expenditure, profi t, purchases of fi xed assets, and equity. The Annual Enterprise Survey data also forms the basis of national accounting variables such as value-added, gross output and gross fi xed capital formation.

Population

The target population for the Annual Enterprise Survey is all economically signifi cant businesses operating within New Zealand. The population for this survey is selected from the Business Frame.

In total, the Annual Enterprise Survey is estimated to cover approximately 90 percent of New Zealand’s gross domestic product (GDP). Some industries are excluded; the Australian and New Zealand Standard Industrial Classifi cation 1996 (ANZSIC) industry exclusions are:

● residential property operators not elsewhere classifi ed (L771100-90)

● foreign government representation (M813000)

● religious institutions (Q961000)

● private household employing staff (Q970000).

Design of the Annual Enterprise Survey

The current design of the Annual Enterprise Survey was introduced in the 1999 fi nancial year. The Annual Enterprise Survey was designed as the principal collection vehicle of data used in the compilation of New Zealand’s national accounts. The data collected feeds into the calculation of the economy’s GDP, via the current price annual industry accounts, which are compiled within an input-output framework.

The Annual Enterprise Survey collects fi nancial data for most of the industries operating in the New Zealand economy. The Annual Enterprise Survey industries are based on the ANZSIC. The Annual Enterprise Survey is designed at approximately the four-digit ANZSIC level, or 107 industries.

Sample design

The Annual Enterprise Survey is a stratifi ed sample. Each industry contains between one and four strata, defi ned by size of turnover (sourced from GST information) and rolling mean employment. Each industry has a full coverage stratum made up of large units with signifi cant economic activity within their industry group. Most industries also have a tax strata where IR10 information is used for self-employed individuals and partnerships up to a level of $10 million turnover. The remaining strata contain a sample of medium-sized units.

Religious institutions

Religious institutions have been excluded from the Annual Enterprise Survey in the past. Given that the Annual Enterprise Survey is the primary data source for compilation of the NPISA, an alternative method of estimating the contribution of religious institutions was required.

Accordingly, the estimate was based on a sample of annual accounts supplemented by dated reports collected from previous studies and a number of reports that were available on the registers held by the Companies Offi ce.


88

Statistics NZ also utilised the Annual Enterprise Survey data that was available for institutions from the activity subgroup religious institutions not elsewhere classifi ed. This subgroup represents institutions that do not have administration or worship services as their primary activity, and that do not belong in another activity group, but that do have religion as their purpose. This might include a retail store or a record label whose information would be collected as part of an industry study.

Compiling the data

Religious institutions, especially Christian ones, have complex structures of administration. Many denominations include regional and national bodies and there are transfers of money and labour between them. Furthermore, the legal structures of fi nancial accounts mean there are often separate legal entities that exist for the purposes of insurance, investment and employment.

Consequently, principles applied in the processing of the accounts included:

● the number of units was determined from other sources instead of from the legal entities on the Business Frame

● the entities that existed within the control of clearly recognised bodies were considered part of that body and their fi nancial fl ows netted out and recorded as part of the controlling body’s.

Statistics NZ acknowledges the Vision Network directory of churches78 for its usefulness in assessing the overall number of churches.

Estimating the contribution of non-economically signifi cant units

The non-economically signifi cant units consist of some institutions on the Business Frame and all institutions from other administrative databases or registers. These two groups were estimated independently and then added together to produce an estimate for the fi nancial contribution of non-economically signifi cant units.

Those institutions on the Business Frame were represented by units that had participated in the Annual Enterprise Survey. There were not enough units to create an average estimate for each activity group and only enough for the estimation of a single homogenous institution.

For all other institutions the estimates were based on a sample of annual accounts of charitable trusts and incorporated societies on the Companies Offi ce registers.

Calculating and valuing hours of formal unpaid work

Any activity that was identifi ed as formal volunteer labour in the Time Use Survey 1998/1999 was extracted. Rules were then set up to exclude ‘out of scope’ activities, such as sleeping and socialising. This was an iterative process.

All activities were then analysed according to the eight organisation codes used in the Time Use Survey. These were:

1. Mäori-based committee, organisation, grouping, etc

2. Disability support and health-related services

3. Social support and assistance

4. Education

5. Community safety and protection

6. Leisure and recreation

7. Member benefi t groups

8. Other.

The total number of hours volunteered for these organisation groups was then calculated and totalled, giving the total number of hours volunteered for the period 1 July 1998 to 30 June 1999. It also provided the average hours volunteered per person for all New Zealanders over the age of 12.

To extrapolate the Time Use Survey, total hours to March 2001 (the census period), the average number of hours volunteered per person in the population aged over 12 years, was multiplied by the population aged over 12 years at 31 March 2001. This assumes that the number of hours volunteered was constant,

78 http://www.visionnetwork.org.nz/index.php.


89

and that the number of volunteers grew at the rate of the population. This was done because there was no adequate data available for 1999 to 2001. This had only a negligible effect on the overall estimate.

This average number of hours worked per volunteer is also assumed to have remained constant between 2001 and 2006. However, the number of volunteers79 has increased by 2.1 percent.80 Using a simple straight line equation, the growth of 2.1 percent between 2001 and 2006 for the number of volunteers was modelled to 2004. The modelled increase in the number of volunteers was then multiplied by the average number of hours worked per volunteer, thus giving the total hours volunteered per year. It was assumed that the types of activities remained the same as in 1998/99.

Key assumptions for volunteer labour

● The average hours worked per volunteer has not changed since the 1998/99 Time Use Survey.

● The types of activities (and therefore their proportional representation in each activity grouping) have not changed since the Time Use Survey 1998/99.

● The monetary value of one hour of work for any activity in the paid sector equals the implicit monetary value of one hour of work for the same activity in the unpaid sector.

● The Time Use Survey 1998/99 has provision for ancillary activities (that is, doing two or more activities at once). It has been assumed that these activities have the same productivity as primary activities, since adjusting for any productivity reduction due to multi-tasking (and therefore a reduced wage rate) would be purely on an arbitrary basis.

Differences between the census and the Time Use Survey

The Census of Population and Dwellings is a self-administered questionnaire that asks a range of questions. The census has the advantage of collecting data from the whole population of New Zealand, the data can be broken down to a regional level, and it is also relatively timely for this report. Although the census collects data about unpaid work, this is not its primary aim. It is generally agreed that the census is a lower-end estimate for the number of people involved in informal and formal unpaid work outside of the home.

The Time Use Survey for 1998/99 collected data about formal unpaid work in two modes: through a personal questionnaire, which collected demographic and activity data from the four weeks prior to completing the questionnaire, and a 48-hour diary, which recorded all activities for a 48-hour period. The Time Use Survey is the most fi nely-tuned survey instrument available for getting a good estimate of volunteer labour, both for the number of volunteers and the hours that they work. However, the main limitation is that the data is now some years out of date. The data from the next Time Use Survey is expected to be available in 2010.

Both the census and the Time Use Survey collect data about the number of volunteers in New Zealand. However, their estimates differ quite signifi cantly for several reasons.

The census is conducted as a self-administered survey and the Time Use Survey is an interviewer-administered survey. This affects the response rates because in self-administered surveys there is no interviewer present to probe for further answers or to explain the question if it is misunderstood. Interviewer-administered surveys lead to fewer misunderstood questions and fewer inappropriate responses.

The Time Use Survey has a further advantage in that it is able to use diaries to pick up on the respondents’ unpaid activities that have been overlooked or misunderstood in the survey questions. This may lead to an increase in response rates.

While the census is a key part of a wider integrated population and social statistics system, it cannot provide the depth of information of a targeted social survey such as the Time Use Survey. In the census, unpaid work is a third tier subject and greater emphasis is placed on other questions. This is evident in that the term ‘voluntary work’ is placed at the bottom of the unpaid work question and has few behavioural prompts due to the limited space on the census form. The Final Report on Content81 for the 2006 Census concluded that although unpaid work would be better suited to a specialist time use survey or similar, it had important value in measuring social capital, providing recognition of the importance of this work, and in allowing people who do not undertake paid work to record their participation in unpaid activities.

79 As derived from question 33 from the personal questionnaire of the Time Use Survey 1998/99, which was previously unpublished.

80 According to the Census question ‘Did you in the last four weeks do any unpaid work for… Other voluntary help for organisation/group/marae’.

81 Statistics New Zealand (2003), 17.


90

Terms and definitions

Australian and New Zealand Standard Industrial Classification 1996 (ANZSIC)The ANZSIC has been developed for use in Australia and New Zealand for the production and analysis of industry statistics. Institutions are classifi ed according to the predominant activity in which they are engaged. The Annual Enterprise Survey has been designed using the ANZSIC classifi cation, with some subdivisions and groups re-aggregated to refl ect New Zealand operations.

Business FrameA list of individual, private and public-sector businesses and institutions that are engaged in the production of goods and services in New Zealand and are above specifi ed size criteria.

Business typeThe legal status of a business institution (including non-profi t institutions).

Charitable companiesCompanies accepted by Inland Revenue as charitable organisations.82 Shareholders must themselves be approved charities and profi ts can only be distributed to these charitable entities.

Charitable trustsInstitutions registered under the Charitable Trusts Act 1957 whose purpose is deemed to be charitable under New Zealand law but includes every purpose that is religious or educational, whether or not it is charitable according to the law of New Zealand.

Economically significantAn enterprise which meets at least one of the following criteria:

● has greater than $30,000 annual GST expenses or sales

● has rolling mean employment greater than three

● is in a goods and services tax (GST) exempt industry (except residential property leasing and rental)

● is part of a group of enterprises

● is a new GST registration that is compulsory, special or forced

● is registered for GST and is involved in agriculture or forestry.

Employee count Head count of salary and wage earners sourced from taxation data. Employee count data is available on a monthly basis. It is made up mostly of employees, but can include working proprietors who pay themselves a salary or wage.

Employee count is now the indicator of business size (employment levels) used by Statistics New Zealand. It has replaced the previous use of full-time equivalent (FTE) measures. The employment count is obtained primarily from administrative databases maintained by Inland Revenue. This form is required to be completed on a monthly basis by employers, and allows for the number of salary and wage earners to be derived. There are a small number of enterprises whose employee count is collected by Statistics NZ surveys.

EnterpriseA business operating in New Zealand. It can be a company, partnership, trust, estate, incorporated society, producer board, local or central government institution, voluntary institution or self-employed individual.

The enterprise unit is the default unit of measurement and classifi cation for the Non-profi t Institution Satellite Account. Analysis at the kind-of-activity unit level has been undertaken where those non-profi t institutions with multiple kind-of-activity units are signifi cant enough to have an effect on the statistics derived.

82 Also referred to as donee organisations.


91

Full-time equivalent persons engaged (FTE)The total number of full-time employees and working proprietors plus half the number of part-time employees and working proprietors.

Geographic unit / business locationA separate operating unit engaged in New Zealand in one, or predominantly one, kind of economic activity from a single physical location or base.

Incorporated societiesSocieties of not less than 15 persons associated for any lawful purpose but not for pecuniary gain registered under the Incorporated Societies Act 1908.

Institutional sectorBroad economic groupings that bring together institutions that play similar roles in the economy and react similarly to various market prices and/or economic policies.

Kind-of-activity unit A subdivision of an enterprise engaged in predominantly one activity that a single set of accounting records is available. This is the statistical unit used in the Annual Enterprise Survey.

Rolling mean employment The 12 months’ moving average of the monthly employment count, derived from administrative databases maintained by Inland Revenue.

Statistical unitThe structure of each business on the Business Frame consists of an enterprise, a kind-of-activity unit and a geographic unit. These are collectively referred to as statistical units. Larger or more complex businesses may have a number of statistical units. Each of the statistical units is given an industry classifi cation based on its predominant activity. Different divisions of a company may be spread across several industries, depending on how the company has been structured. The collection unit for the Annual Enterprise Survey is the kind-of-activity unit. By defi nition, a kind-of-activity unit is engaged in predominantly one activity for which a single set of accounting records is available.

Unincorporated associations/societiesClubs, societies and other groups that are formally organised but are not incorporated and hence not registered under any Act of Parliament.


92

National accounting terms and definitions

Capital accountThis account shows the types of expenditure incurred by residents in accumulating capital assets and the total amount of funds available for that purpose. The difference between capital accumulation of assets and the funds available to residents (that is, savings, income set aside for the replacement of capital equipment used up, and capital transfers from the rest of the world, net) is made up by lending to or borrowing from the rest of the world. By convention, this residual (net lending to the rest of the world) is shown as a debit item.

Compensation of employees Payments of salaries and wages whether in cash or in kind (such as fringe benefi ts) to employees. Includes contributions paid on employees’ behalf to superannuation funds, private pension schemes, the Accident Compensation Corporation, casualty and life insurance schemes, etc.

Consumption of fixed capital This measures the decline in value of fi xed assets used in production, as a result of physical deterioration and normal obsolescence. It is now valued at replacement cost.

Dividends receivedIncome received in the form of dividends as the result of directly owning shares in companies.

Gross domestic product (GDP) The total market value of goods and services produced in New Zealand after deducting the cost of goods and services utilised in the process of production, but before deducting allowances for the consumption of fi xed capital.

Gross fixed capital formationThe outlays of producers on durable fi xed assets, such as buildings, motor vehicles, plant and machinery, hydro-electric construction, roading, and improvements to land. In measuring the outlays, sales of similar goods are deducted. Land is excluded from gross fi xed capital formation. Included is the value of construction work done by a fi rm’s own employees. The term ‘gross’ indicates that consumption of fi xed capital has not been deducted from the value of the outlays.

Gross operating surplusThis is a residual item, being gross output at producer’s values less the sum of intermediate consumption, compensation of employees, and taxes on production net of subsidies. It is approximately equal to accounting profi t before the deduction of direct taxes, dividends, depreciation, interest paid and bad debts, and before the addition of interest and dividends received.

Gross outputThe value of total production including intermediate inputs. It consists only of those goods and services that are produced within an establishment that become available for use outside that establishment.

Gross outputequals sales of goods and services plus non-market output provided free.

Income and outlay accountThis account shows the total income received and how this income is appropriated. The balancing item is saving, which is a major source of fi nance for investment in fi xed assets and stocks.

Interest paymentsIncludes interest paid on credit advances and mortgage interest.

Interest receivedInterest received from investment in banks and other fi nancial institutions.


93

Intermediate consumptionThe term used to denote the value of goods and services used as inputs in production. Valuation is at purchasers’ values (that is, exclusive of GST).

Investment income Includes interest and dividends received.

National accountsSee System of National Accounts.

Non-market output provided freeThis consists of goods and services produced by non-profi t institutions serving households or government that are supplied free, or at prices that are not economically signifi cant, to other institutional units or the community as a whole.

Operating surplusThe balancing item in the value-added equation below. It is a proxy for the profi ts of the institution.

Outlay Current transfers to non-profi t institutions, other residents, non-residents plus interest payments plus taxes on incomeplus fi nal consumption expenditure. equals outlay.

Production accountThis account records the activity of producing goods and services as defi ned within the New Zealand System of National Accounts. Its balancing item, gross value-added, is a measure of the contribution to GDP made by an individual producer, industry or sector.

SavingsThe residual item in the income and outlay account.

Income less outlays equals savings.

Services for own useSee non-market output provided free.

Taxes on productionIncludes taxes payable on goods and services when they are produced, delivered, sold or transferred by their producers, and other taxes on production such as local authority rates.

Value-addedThe value-added to goods and services by the contributions of capital and labour (that is, after the costs of bought-in materials and services have been deducted from the total value of output).

Gross output minus intermediate consumption equals GDP production measure of value-added.

Compensation of employeesplus indirect taxesplus depreciationplus operating surplus. equals GDP income measure of value-added.


94

Detailed tablesThe tables in this section of the Non-profi t Institutions Satellite Account (NPISA) are presented using the New Zealand System of National Accounts (NZSNA) framework, with two extensions as discussed in chapter 3, ‘Measurement framework’.

The labelling convention used in the tables is that the NZSNA-based estimates are labelled as ‘SNA-based’, or ‘compiled within the System of National Accounts framework’. These estimates are predominantly based on the Annual Enterprise Survey but also incorporate the estimates of religious institutions and non-economically signifi cant units. Tables that are solely SNA-based do not include the following two extensions:

● The incorporation of non-market output of market non-profi t institutions into the estimates is referred to as ‘extension 1’ of the NPISA in the tables.

● The incorporation of valuation of volunteer labour into the estimates is referred to as ‘extension 2’ of the NPISA in the tables. The total after the incorporation of extension 2 includes extension 1 and the SNA-based estimates.


95

Table 9.01 provides the NPISA summary production account, income and outlay account, and capital account information for the SNA-based estimates and its two extensions.

Table 9.01

SNA(2)-based Extension 1(3)SNA(2)-basedplus extension

1Extension 2(4) Total

Production accountGross output 7,119,834 82,235 7,202,068 3,311,970 10,514,038

Sales of goods and services 4,869,708 … 4,869,708 … 4,869,708 Non-market output provided free 2,250,125 82,235 2,332,360 3,311,970 5,644,329

Intermediate consumption 3,479,672 … 3,479,672 … 3,479,672Value-added 3,640,162 82,235 3,722,396 3,311,970 7,034,366

Compensation of employees 2,611,090 … 2,611,090 … 2,611,090 Volunteer labour valuation … … … 3,311,970 3,311,970 Taxes on production 227,676 … 227,676 … 227,676 Consumption of fixed capital 401,680 … 401,680 … 401,680 Operating surplus 399,715 82,235 481,950 … 481,950

Income and outlay accountIncome 3,566,252 82,235 3,648,487 3,311,970 6,960,456

Operating surplus 399,715 82,235 481,950 … 481,950Investment income 478,107 … 478,107 … 478,107 Interest received 345,971 … 345,971 … 345,971 Dividends received 132,135 … 132,135 … 132,135Current transfers 2,688,430 … 2,688,430 3,311,970 6,000,400 Donations received 1,905,396 … 1,905,396 3,311,970 5,217,365 Government grants 758,829 … 758,829 … 758,829 Net non-life insurance claims 24,206 … 24,206 … 24,206Outlays 3,073,831 82,235 3,156,066 3,311,970 6,468,036 Donations paid 684,746 … 684,746 … 684,746 Net non-life insurance premiums 42,691 … 42,691 … 42,691 Interest payments 96,270 … 96,270 … 96,270 Non-market output provided free 2,250,125 82,235 2,332,360 3,311,970 5,644,329Savings 492,421 … 492,421 … 492,421

Capital accountSource of funds

Savings 492,421 … 492,421 … 492,421 Consumption of fixed capital 401,680 … 401,680 … 401,680Capital accumulation 628,056 … 628,056 … 628,056Net lending/borrowing 266,045 … 266,045 … 266,045

(1) Individual figures may not sum to totals due to rounding.(2) System of Natonal Accounts.(3) Includes a calculation of non-market output provided free for market units.(4) Includes valuation of volunteer labour.


Non-profit Institutions Satellite Account and Extensions, in Summary Form(1)


2004


96

Table 9.02 provides summary SNA-based (only) information for the production account, income and outlay account, and capital account, by institutional sector.

Table 9.02

Non-financialcorporations(1)

Generalgovernment and

non-profitinstitutions

servinghouseholds(2)(3)

Production accountGross output 2,024,390 5,095,444 7,119,834 Sales of goods and services 2,024,390 2,845,319 4,869,708 Non-market output provided free … 2,250,125 2,250,125Intermediate consumption 976,139 2,503,532 3,479,672Value-added 1,048,250 2,591,912 3,640,162 Compensation of employees 348,558 2,262,532 2,611,090 Taxes on production 189,474 38,203 227,676 Consumption of fixed capital 139,358 262,322 401,680 Operating surplus 370,860 28,856 399,715

Income and outlay accountIncome 463,830 3,102,423 3,566,252 Operating surplus 370,860 28,856 399,715 Investment income 45,849 432,257 478,107 Interest received 33,528 312,443 345,971 Dividends received 12,321 119,814 132,135 Current transfers 47,121 2,641,310 2,688,430 Donations received 43,062 1,862,334 1,905,396 Government grants 100 758,730 758,829 Net non-life insurance claims 3,959 20,246 24,206Outlays 320,461 2,753,371 3,073,831 Donations paid 293,380 391,366 684,746 Net non-life insurance premiums 6,983 35,708 42,691 Interest payments 20,099 76,172 96,270 Non-market output provided free … 2,250,125 2,250,125Savings 143,370 349,052 492,421

Capital accountSource of funds Savings 143,370 349,052 492,421 Consumption of fixed capital 139,358 262,322 401,680Capital accumulation 114,475 513,582 628,056Net lending/borrowing 168,253 97,792 266,045

(1) Also referred to as market units.(2) Also referred to as non-market units.(3) These two institutional sectors have been combined for confidentiality reasons.


Non-profit Institutions Satellite Account by Institutional Sector2004


Institutional sector

Total


97

Table 9.03.1 provides SNA-based (only) production account estimates, by NZSCNPO activity group.

Table 9.03.1

Equals Less Equals


Non-marketoutput

providedfree

Grossoutput

Intermediateconsumption

Value-added(GDP)(2) Compensation

of employees

Taxes on production

Consumptionof fixed capital

Operatingsurplus

1 Culture and recreation

984,000 479,184 1,463,184 997,080 466,104 322,836 26,198 110,394 6,675

2 Education and research

503,404 479,820 983,224 402,070 581,154 517,438 3,703 47,899 12,114

3 Health 694,178 108,323 802,501 335,689 466,812 362,787 2,290 42,819 58,9164 Social services 1,013,297 338,028 1,351,326 528,356 822,970 758,734 6,439 51,619 6,1785 Environment 124,644 25,199 149,843 110,650 39,193 33,659 213 3,228 2,0936 Development and

housing109,408 125,597 235,005 131,054 103,951 93,135 688 9,279 849

7 Law, advocacy and politics

124,816 47,965 172,781 88,794 83,988 71,656 417 8,397 3,517

8 Grant making, fundraising and voluntarismpromotion

688,688 29,882 718,570 152,817 565,754 15,624 181,071 72,443 296,615

9 International 18,528 32,805 51,333 29,708 21,624 18,695 57 1,992 88110 Religion 145,880 436,817 582,697 295,546 287,151 246,206 5,165 35,780 011 Business and

professionalassociations, unions

417,920 91,345 509,265 337,104 172,161 148,398 1,090 12,139 10,534

12 Not elsewhere classified

44,943 55,162 100,105 70,804 29,301 21,922 345 5,690 1,343

Total 4,869,708 2,250,125 7,119,834 3,479,672 3,640,162 2,611,090 227,676 401,680 399,715

(1) System of National Accounts.(2) Gross domestic product.

Production account2004

Activity group

OutputMade up of

InputMade up of

Non-profit Institutions Satellite Account, Compiled within the SNA(1) Framework

$(000)


98

Table 9.03.2 is as per table 9.03.1, except that a further (subgroup level) breakdown of the culture and recreation NZSCNPO activity group is provided. These subgroups are defi ned in appendix 2.

Table 9.03.2

Equals Less Equals


Non-marketoutput

provided freeGross output

Inter-mediate

consump-tion

Value added (GDP)(3)

Compen-sation of

employees

Taxes on production

Consump-tion of fixed

capital

Operatingsurplus

1100 Culture and arts 81,773 86,574 168,347 105,930 62,417 50,170 105 9,969 2,172

1200 Sports 516,496 326,246 842,743 581,157 261,586 163,769 5,557 63,109 29,1511300 Other recreation

and social clubs375,984 60,079 436,063 301,734 134,328 102,417 20,394 36,575 -25,059

1999 Culture and recreationsupport and ancillary service

9,748 6,284 16,032 8,259 7,773 6,479 142 741 411

Total 984,000 479,184 1,463,184 997,080 466,104 322,836 26,198 110,394 6,675

(1) Non-profit Institutions Satellite Account.(2) System of National Accounts.(3) Gross domestic product.

Culture and Recreation Subgroups NPISA,(1) Compiled within the SNA(2) FrameworkProduction account

2004

Subgroup

Output InputMade up of Made up of

$(000)

Table 9.03.3 is as per table 9.03.1, except that a further (subgroup level) breakdown of the education and research NZSCNPO activity group is provided. These subgroups are defi ned in appendix 2.

Table 9.03.3

Equals Less Equals


Non-marketoutput

provided freeGross output

Inter-mediate

consump-tion

Value added (GDP)(3)

Compen-sation of

employees

Taxes on production

Consump-tion of fixed

capital

Operatingsurplus

2110 Early childhood education

41,495 166,492 207,988 52,388 155,600 145,322 582 9,073 624

2120 Primary and secondaryeducation

205,604 38,483 244,087 74,716 169,372 150,558 1,056 16,592 1,166

2200,2300,2400

Highereducation, other education and research

198,592 228,340 426,932 210,653 216,279 189,361 1,631 16,229 9,059

2999 Education and researchsupport and ancillary service

57,712 46,504 104,217 64,315 39,902 32,197 434 6,005 1,266

Total 503,404 479,820 983,224 402,070 581,154 517,438 3,703 47,899 12,114

(1) Non-profit Institutions Satellite Account.(2) System of National Accounts.(3) Gross domestic product.

Education and Research Subgroups NPISA (1), compiled within the SNA(2) FrameworkProduction account

2004

Subgroup

Output InputMade up of Made up of

$(000)


99

Table 9.04.1 provides SNA-based (only) income and outlay account estimates, by NZSCNPO activity group.

Table 9.04.1


Net non-life insurance

claims

1 Culture and recreation 6,675 37,359 3,258 473,951 119,078 6,893 647,2142 Education and research 12,114 21,683 3,438 109,359 400,937 3,062 550,5933 Health 58,916 11,024 11,122 103,654 30,314 1,323 216,3524 Social services 6,178 33,854 6,595 254,032 83,306 3,170 387,1365 Environment 2,093 2,580 91 25,798 5,650 187 36,3996 Development and housing 849 5,110 925 67,994 68,735 677 144,2907 Law, advocacy and politics 3,517 4,417 1,688 51,615 11,817 308 73,3638 Grant making, fundraising and

voluntarism promotion296,615 147,178 94,204 56,166 4,545 450 599,159

9 International 881 4,810 406 89,716 11,254 36 107,10310 Religion 0 53,620 7,165 534,224 5,435 6,483 606,92711 Business and professional associations,

unions10,534 21,554 3,077 93,643 4,251 1,234 134,293

12 Not elsewhere classified 1,343 2,782 166 45,242 13,508 383 63,424Total 399,715 345,971 132,135 1,905,396 758,829 24,206 3,566,252

DonationsNet non-life insurancepremiums

InterestNon-market

output provided free

Total outlays

1 Culture and recreation 45,830 12,158 20,951 479,184 558,122 89,0922 Education and research 9,114 5,400 10,159 479,820 504,493 46,1003 Health 11,536 2,333 3,544 108,323 125,736 90,6154 Social services 13,091 5,591 13,811 338,028 370,522 16,6145 Environment 2,799 329 1,147 25,199 29,474 6,9256 Development and housing 6,578 1,194 3,778 125,597 137,147 7,1437 Law, advocacy and politics 2,433 544 1,463 47,965 52,405 20,9588 Grant making, fundraising and

voluntarism promotion462,063 794 12,334 29,882 505,073 94,086

9 International 65,641 63 108 32,805 98,616 8,48610 Religion 56,142 11,433 25,267 436,817 529,659 77,26811 Business and professional associations,

unions5,899 2,177 1,025 91,345 100,446 33,846

12 Not elsewhere classified 3,617 675 2,684 55,162 62,137 1,287Total 684,746 42,691 96,270 2,250,125 3,073,831 492,421


Income

Non-profit Institutions Satellite Account, Compiled within the SNA(1) FrameworkIncome and outlay account

2004

Activity group

Operatingsurplus

Investment income Current transfers

Total income

$(000)

Outlays

Savings

$(000)


100

Table 9.04.2 is as per table 9.04.1, except that a further (subgroup level) breakdown of the culture and recreation NZSCNPO activity group is provided.

Table 9.04.2



claims

1100 Culture and arts 2,172 5,502 531 55,492 37,021 719 101,4371200 Sports 29,151 18,779 513 292,742 70,904 3,525 415,6141300 Other recreation and

social clubs-25,059 10,676 1,956 116,242 9,222 2,608 115,647

1999 Culture and recreation support and ancillary service

411 2,401 258 9,475 1,931 41 14,516

Total 6,675 37,359 3,258 473,951 119,078 6,893 647,214


InterestNon-market

outputprovided free

Total outlays

1100 Culture and arts 5,469 1,268 1,550 86,574 94,861 6,5761200 Sports 28,463 6,217 11,067 326,246 371,994 43,6211300 Other recreation and

social clubs11,449 4,600 7,783 60,079 83,911 31,735

1999 Culture and recreation support and ancillary service

449 73 551 6,284 7,356 7,160

Total 45,830 12,158 20,951 479,184 558,122 89,092

(1) Non-profit Institutions Satellite Account.(2) System of National Accounts.

Culture and Recreation Subgroups NPISA(1), Compiled within the SNA(2) FrameworkIncome and outlay account

2004

Subgroup

Income

Operatingsurplus

Investment income Current transfersTotal

income

$(000)

Outlays

Savings

$(000)


101

Table 9.04.3 is as per table 9.04.1, except that a further (subgroup level) breakdown of the education and research NZSCNPO activity group is provided.

Table 9.04.3


Insuranceclaims


624 2,977 2,345 16,488 160,422 369 183,226

2120 Primary and secondary education

1,166 7,686 433 13,825 39,616 804 63,528

2200, 2300, 2400

Higher education, other education and research

9,059 7,432 510 58,055 181,273 745 257,073

2999 Education and research support and ancillary service

1,266 3,589 150 20,992 19,626 1,143 46,766

Total 12,114 21,683 3,438 109,359 400,937 3,062 550,593

DonationsNet

insurancepremiums

InterestNon-market

outputprovided free

Totaloutlays


2,712 651 995 166,492 170,851 12,375

2120 Primary and secondary education

25 1,417 5,689 38,483 45,615 17,913

2200, 2300, 2400

Higher education, other education and research

3,784 1,315 1,436 228,340 234,874 22,199

2999 Education and research support and ancillary service

2,593 2,017 2,039 46,504 53,153 -6,387

Total 9,114 5,400 10,159 479,820 504,493 46,100

(1) Non-profit institutions satellite account.(2) System of National Accounts.

Outlays

Savings

$(000)

Education and Research Subgroups NPISA(1), Compiled within the SNA(2) FrameworkIncome and outlay account

2004

Subgroup

Income

Operatingsurplus

Investment income Current transfers Totalincome

$(000)


102

Table 9.05.1 provides estimates that include the two extensions (non-market output of market non-profi t institutions, and volunteer labour), with a partial breakdown of the production account by NZSCNPO activity group. A full breakdown of NZSCNPO activity groups could not be provided due to the use of Time Use Survey data in the volunteer labour estimates. The Time Use Survey classifi cation categories only partially match the NZSCNPO activity group categories.

Extension 1 data (non-market output of market non-profi t institutions) are included in non-market output provided free (on the outputs side) and operating surplus (on the inputs side). Extension 2 data (volunteer labour valuation) have stand-alone categories on both the output and inputs sides.

Table 9.05.1

Less Equals

Total(2)

of which volunteer

labourvaluation

1 Culture and recreation 984,000 1,487,932 958,926 2,471,932 997,080 1,474,8522 Education and research 503,404 971,152 491,332 1,474,555 402,070 1,072,4853 and 4 Health and social services 1,707,475 864,074 416,026 2,571,549 864,045 1,707,5045 to 12 All other groups 1,674,829 2,321,173 1,445,687 3,996,001 1,216,477 2,779,525Total 4,869,708 5,644,329 3,311,970 10,514,038 3,479,672 7,034,366

Compensationof employees

Volunteerlabour

valuation

Taxes on production

Consumptionof fixed capital

Operatingsurplus(2)

1 Culture and recreation 322,836 958,926 26,198 110,394 56,4982 Education and research 517,438 491,332 3,703 47,899 12,1143 and 4 Health and social services 1,121,521 416,026 8,730 94,438 66,7915 to 12 All other groups 649,295 1,445,687 189,046 148,949 346,548Total 2,611,090 3,311,970 227,676 401,680 481,950

(1) New Zealand Standard Classification of Non-profit Organisations.(2) Includes valuation of non-market output provided free for market units.(3) Gross domestic product.

$(million)

InputMade up of

Non-profit Institutions Satellite Account with Extensions

Output Input

Production account2004

Made up of

$(million)NZSCNPO(1) activity group

Intermediateconsumption

Value-added(GDP)(3)

Gross output

Non-market output provided free



103

Table 9.05.2 provides estimates that include the two extensions (non-market output of market non-profi t institutions, and volunteer labour), with a partial breakdown of the income and outlay account by NZSCNPO activity group. A full breakdown of NZSCNPO activity groups could not be provided due to the use of Time Use Survey data in the volunteer labour estimates. The Time Use Survey classifi cation categories only partially match the NZSCNPO activity group categories.

Table 9.05.2

Interest Dividends Donations(3) Governmentgrants


claims

1 Culture and recreation 56,498 37,359 3,258 1,432,877 119,078 6,893 1,655,9622 Education and research 12,114 21,683 3,438 600,691 400,937 3,062 1,041,9243 and 4 Health and social services 66,791 44,878 17,716 773,712 113,620 4,493 1,021,2105 to 12 All other groups 346,548 242,052 107,723 2,410,086 125,194 9,757 3,241,360Total 481,950 345,971 132,135 5,217,365 758,829 24,206 6,960,456


InterestNon-market

output provided free(2)(3)

Total outlays

1 Culture and recreation 45,830 12,158 20,951 1,487,932 1,566,870 89,0922 Education and research 9,114 5,400 10,159 971,152 995,825 46,1003 and 4 Health and social services 24,627 7,924 17,355 864,074 913,981 107,2295 to 12 All other groups 605,174 17,209 47,805 2,321,173 2,991,360 249,999Total 684,746 42,691 96,270 5,644,329 6,468,036 492,421

(1) New Zealand Standard Classification of Non-Profit Organisation.

(2) Includes valuation of non-market output provided free for market units.(3) Includes valuation of volunteer labour.

$(000)

Non-profit Institutions Satellite Account with ExtensionsIncome and outlay account

2004

NZSCNPO(1) activity group

Income

Operatingsurplus(2)

Investment income Current transfers

Total income

$(000)

Outlays

Savings


104

Appendix 1 –

Decision trees: Structural-operational definition

Criterion 1: Organisation(UN handbook reference 2.15)

Legal character of incorporation; or some degree of structure, goals, measurable activity and defi nite boundary.

Figure 10.1

Structural-Operational Defi nition: Organisation Criterion

START

Does the organisationhave legal

status?

N

Is it recognisedin a formal

way?

Registeredfor GST?

Or have interestPAYE

exemption?

Oraffiliatedto a legal

body?

N

N NY

Y Y Y

Does it have the capacity to

produce a complete set of

accounts? (1)

Y N

IN SCOPE OUT OF SCOPE

1 That is, can the entity put together statements of financial position and performance.

Does it have a written set of rules re (as a

minimum)membership,structure and

decision-making?Y N


105

Criterion 2: Not for profit(UN handbook reference 2.16)

Any surplus must be ploughed back into the basic mission of the organisation and not distributed to owners, members, founders or governing board.

Figure 10.2

Structural-Operational Defi nition: Not for Profi t Criterion

IN SCOPE

N Y

STARTIs the organisation primarily set up to generate profits?

N

Are the members / owners /

governing board able to gain

financially? (1)

Y

Is the remuneration

contractual (eg employee,

honorarium, etc)?

NY

OUT OF SCOPE

1 Notwithstanding contractual remuneration, any such income received by members, etc, will not be exempt income under the Income Tax Act.


106

Criterion 3: Institutionally separate from government(UN handbook reference 2.17)

Has an institutional identity separate from the state such that it is not an instrumentality of any unit of government and therefore does not exercise government authority.

Figure 10.3

Structural-Operational Defi nition: Institutionally Separate from Government Criterion

START

Is the organisation

a Crown reportingentity?

N

Is the organisation a

LA(1), CCO (3) or local

governanceentity?

N

Does the Govt (Cent or Local)

appoint the majority of board

and/or senior staff?

N

Is the organisation

established by public statute?

N

Y Y Y Y

Y

Are the representativesappointed with

Govt authority?(3)

N

Is it required, by statute, to table

a report for approval to

Parliament or LA(1) Council?Y N

OUT OF SCOPE IN SCOPE

1 Local authority.2 Council-controlled organisation as defined under the Local Government Act 2002.3 Otherwise they are appointed as private citizens.

but see also self-governing criterion re govt & veto powers


107

Criterion 4: Self-governing(UN handbook reference 2.18)

Is able to control its own activities and is not under the effective control of any other entity.

Figure 10.4

Structural-Operational Defi nition: Self-governing Criterion

OUT OF SCOPE

Y

Does the statute prescribe -

purpose, powers & functions,

board structure?

N

Y N N Y

STA

RT

Is the organisation set

up by public statute?

N

Can the organisation

dissolve itself? (1)

Y

Is it in charge of its day-to-

daymanagement?

Y

Are there govt appointees or corporate reps

with veto power?

N

IN SCOPE

1 And, ipso facto, autonomously change its rules and/or purpose.

Criterion 5: Non-compulsory(UN handbook reference 2.19)

Membership and contributions of time and money are not required or enforced by law or otherwise made a condition of citizenship; or determined by birth (eg tribes, clans).

Figure 10.5

Structural-Operational Defi nition: Non-compulsory Criterion

Y

Is membership required to be

able to conduct prof. or trade activities or

course of study?

N OUT OF SCOPE

NY Y

START Is membership enforced by law? N

Is membership a condition of citizenship?

N

Ismembershipdetermined

by birth?

Y

Ismembership,nevertheless,

a matter of choice?

N Y

IN SCOPE


108

SummaryFigure 10.6

Summary of Structural-Operational Defi nition

Does the organisation have

legal status?N

further questions for unincorporated and

informal entitiesY either / or

IN SCOPE for organisation criterion

OUT OF SCOPE

Is the organisation primarily set up to generate profits?

Y

NAre the members / owners / governing board able to gain

financially?

Yfurther question regarding profit

distribution

N either / orIN SCOPE for non-

profit criterionOUT OF SCOPE

Is it a Crown Reporting Entity or Local Authority or

CCO(1)?

Y further questions regarding

independence from government

N either / or

IN SCOPE for separate from

government criterion

OUT OF SCOPE

Is the organisation in control of its

destiny?N

further questions regarding self government

Y either / orIN SCOPE for self-governing criterion

OUT OF SCOPE

Is membership a matter of choice? N

further questions regarding compulsion

of membershipY either / or

IN SCOPE for non-compulsory criterion

OUT OF SCOPE

IN SCOPE for SATELLITEACCOUNT

1 Council-controlled organisation as defined under the Local Government Act 2002.

Applying the NPI structural-operational definition


109

Appendix 2 –New Zealand Standard Classification of Non-Profit Organisations(NZSCNPO)

Group Subgroup

01 Culture and recreation 01 100 Culture and arts

01 200 Sports

01 300 Other recreation and social clubs

01 999 Culture and recreation support and ancillary services

02 Education and research 02 110 Early childhood education

02 120 Primary and secondary education

02 200 Higher education

02 300 Other education

02 400 Research

02 999 Education and research support and ancillary services

03 Health 03 100 Hospitals and rehabilitation

03 200 Nursing homes

03 300 Mental health and crisis intervention

03 400 Other health services

03 999 Health support and ancillary services

04 Social services 04 100 Social services

04 200 Emergency and relief

04 300 Income support and maintenance

04 999 Social services support and ancillary services

05 Environment 05 100 Environment

05 200 Animal protection

05 999 Environment support and ancillary services

06 Development and housing 06 100 Economic, social and community development

06 120 Tangata whenua governance organisations

06 200 Housing

06 300 Employment and training

06 999 Development and housing support and ancillary services

07 Law, advocacy and politics 07 100 Civic and advocacy organisations

07 200 Law and legal services

07 300 Political organisations

07 999 Law, advocacy and politics support and ancillary services

08 Grant making, fundraising and voluntarism promotion

08 100 Grant making foundations

08 210 Fundraising organisations

08 220 Voluntarism promotion

08 999 Grant making, fundraising and voluntarism promotion support and ancillary services

09 International 09 100 International activities

09 999 International support and ancillary services

10 Religion 10 100 Religious congregations and associations

10 999 Religion support and ancillary services


110

Group Subgroup

11 Business and professional associations, unions

11 100 Business associations

11 200 Professional associations

11 300 Labour unions

11 999 Business and professional associations, unions support and ancillary services

99 Not elsewhere classifi ed (residual categories)

99 100 Other

99 444 Don’t know

99 555 Refused to answer

99 777 Response unidentifi able

99 888 Response outside scope

99 999 Not stated

Subgroup descriptions and examplesSubgroup Subgroup description

01 100 Culture and arts Media and communications, visual arts, architecture and ceramic art, performing arts, historical, literary, heritage and humanistic societies, museums and zoos and aquariums.

01 200 Sports Provision of amateur sport, training, physical fi tness and sport competition services and events.

01 300 Other recreation and social clubs

Provision of recreational facilities and services to individuals and communities. Also includes service clubs, which are membership organisations providing services to members and local communities.

01 999 Culture and recreation support and ancillary services

Non-profi t institutions not adequately covered in the activity descriptors above but related in purpose.

02 110 Early childhood education Institutions with a focus on providing early childhood education (excludes child minding services).

02 120 Primary and secondary education

School education at primary and secondary levels.

02 200 Higher education Higher learning, providing academic degrees. Includes, business management schools, law and medical schools.

02 300 Other education Vocational and technical training specifi cally geared towards gaining employment. Also includes adult/continuing education where institutions are engaged in providing education and training in addition to the formal education system.

02 400 Research Research institutions in the areas of science and technology, social sciences, policy studies or medicine.

02 999 Education and research support and ancillary services


03 100 Hospitals and rehabilitation Hospitals providing in-patient healthcare including physiotherapy and other rehabilitative therapy for those suffering from injury, genetic defect or disease.

03 200 Nursing homes In-patient convalescent care and residential care, nursing homes for the severely handicapped, hospice services.

03 300 Mental health and crisis intervention

Psychiatric hospitals, outpatient treatment for mentally ill, and outpatient services and counsel in acute mental health situations.

03 400 Other health services Public health promotion and health education, outpatient health treatment, outpatient rehabilitative medical services and emergency medical services.

03 999 Health support and ancillary services


04 100 Social services Child welfare, child services and day care, youth services and youth welfare, family services, services for the handicapped and elderly and self-help and other personal social services.

04 200 Emergency and relief Disaster/emergency prevention and control, temporary shelters and refugee assistance.

04 300 Income support and maintenance

Institutions providing cash assistance, food, clothing, transport and other forms of assistance to people unable to maintain a livelihood.


111

Subgroup Subgroup description

04 999 Social services support and ancillary services


05 100 Environment Institutions that promote pollution abatement and control, natural resources conservation and protection and environmental beautifi cation and open spaces.

05 200 Animal protection Institutions involved in animal protection and welfare, wildlife preservation and protection and veterinary services.

05 999 Environment support and ancillary services


6 100 Economic, social and community development

Institutions working towards improving the quality of life within communities, the economic and institutional infrastructure and capacity to improve general public well-being.

06 120 Tangata whenua governance institutions

Tangata whenua governance organisations.

06 200 Housing Institutions involved with development, construction, management, leasing, fi nancing and rehabilitation of housing as well as institutions related with housing assistance.

06 300 Employment and training Institutions that provide and support job training programmes, vocational counselling and guidance, and promote self-suffi ciency and income generation through job training and employment.

06 999 Development and housing support and ancillary services


07 100 Civic and advocacy organisations

Advocacy institutions, civil rights, ethnic and civic associations.

07 200 Law and legal services Legal services, crime prevention and public policy, rehabilitation of offenders, victim support and consumer protection associations.

07 300 Political organisations Activities and services to support the placing of particular candidates into political offi ce.

07 999 Law, advocacy and politics support and ancillary services


08 100 Grant making foundations Private grant making foundations.

08 210 Fundraising organisations Fundraising institutions.

08 220 Voluntarism promotion Institutions that recruit, train and place volunteers and promote volunteering.

08 999 Grant making, fundraising and voluntarism promotion support and ancillary services


09 100 International activities Exchange/friendship/cultural programmes, development assistance associations, international disaster and relief institutions and international human rights and peace.

09 999 International support and ancillary services


10 100 Religious congregations and associations

Churches, and similar institutions promoting religious beliefs and administering religious services and rituals.

10 999 Religion support and ancillary services


11 100 Business associations Institutions that work to promote, regulate and safeguard interests of branches of business.

11 200 Professional associations Institutions promoting, regulating and protecting professional interests.

11 300 Labour unions Institutions that promote, protect and regulate the rights and interests of employees.

11 999 Business and professional associations, unions support and ancillary services


99 100 Other Other activities, not generally typical of non-profi t institutions or not adequately covered elsewhere, such as agriculture, accommodation not elsewhere classifi ed (nec) & retail nec.


112

Appendix 3 –Correspondence between NZSCNPO (subgroup level)and ANZSIC96 (subclass level)

NZSCNPO code NZSCNPO descriptor ANZSIC96 code ANZSIC96 descriptor

01100 Culture and arts P911100 Film and Video Production

01100 Culture and arts P911200 Film and Video Distribution

01100 Culture and arts P911300 Motion Picture Exhibition

01100 Culture and arts P921000 Libraries

01100 Culture and arts P922000 Museums

01100 Culture and arts P923100 Zoological and Botanic Gardens

01100 Culture and arts P923900 Recreational Parks and Gardens

01100 Culture and arts P924100 Music and Theatre Productions

01100 Culture and arts P924200 Creative Arts

01100 Culture and arts P925100 Sound Recording Studios

01100 Culture and arts P925200 Performing Arts Venues

01100 Culture and arts P925900 Services to the Arts nec

01100 Culture and arts Q951900 Personal and Household Goods Hiring nec

01200 Sports P931110 Racing Clubs and Track Operation (excluding Training and Ownership)

01200 Sports P931120 Horse and Dog Training (excluding Racing and Ownership)

01200 Sports P931200 Sports Grounds and Facilities nec

01200 Sports P931900 Sports and Services to Sports nec

01300 Other recreation and social clubs H574000 Clubs (Hospitality)

01300 Other recreation and social clubs I640300 Non-Scheduled Air and Space Transport

01300 Other recreation and social clubs I663000 Services to Air Transport

01300 Other recreation and social clubs P933000 Other Recreation Services

02110 Early childhood education N841000 Preschool Education

02120 Primary and Secondary education N842100 Primary Education

02120 Primary and Secondary education N842200 Secondary Education

02120 Primary and Secondary education N842300 Combined Primary and Secondary

Education

02120 Primary and Secondary education N842400 Special School Education

02200 Higher education N843100 Higher Education

02300 Other education N843200 Technical and Further Education

02300 Other education N844000 Other Education

02400 Research L781000 Scientifi c Research

03100 Hospitals and rehabilitation O861100 Hospitals (except Psychiatric Hospitals)

03200 Nursing homes O861300 Nursing Homes

03300 Mental health and crisis intervention O861200 Psychiatric Hospitals

03300 Mental health and crisis intervention Q962900 Interest Groups nec

03400 Other health services O862100 General Practice Medical Services

03400 Other health services O862200 Specialist Medical Services

03400 Other health services O862300 Dental Services

03400 Other health services O863100 Pathology Services

03400 Other health services O863200 Optometry and Optical Dispensing

03400 Other health services O863300 Ambulance Services


113

NZSCNPO code NZSCNPO descriptor ANZSIC96 code ANZSIC96 descriptor

03400 Other health services O863500 Physiotherapy Services

03400 Other health services O863600 Chiropractic Services

03400 Other health services O863900 Health Services nec

04100 Social services O871000 Child Care Services

04100 Social services O872100 Accommodation for the Aged

04100 Social services O872200 Residential Care Services nec

04100 Social services O872900 Non-Residential Care Services nec

04200 Emergency and relief O872900 Non-Residential Care Services nec

04200 Emergency and relief Q962900 Interest Groups nec

04200 Emergency and relief Q963300 Fire Brigade Services

04300 Income support and maintenance O872900 Non-Residential Care Services nec

04300 Income support and maintenance Q962900 Interest Groups nec

05100 Environment Q962900 Interest Groups nec

05200 Animal protection O864000 Veterinary Services

05200 Animal protection Q962900 Interest Groups nec

06110 Economic, social and community development

Q962900 Interest Groups nec

06120 Tangata whenua governance organisations No Equivalent Category

06200 Housing E411100 House Construction

06200 Housing L771190 Residential Property Operators nec

06300 Employment and training L786100 Employment Placement Services

07100 Civic and advocacy organisations Q962900 Interest Groups nec

07200 Law and legal services L784100 Legal Services

07200 Law and legal services O872900 Non-Residential Care Services nec

07200 Law and legal services Q962900 Interest Groups nec

07300 Political organisations Q962900 Interest Groups nec

08100 Grant making foundations K734000 Financial Asset Investors

08100 Grant making foundations K751900 Services to Finance and Investment nec

08100 Grant making foundations P932100 Lotteries

08100 Grant making foundations P932200 Casinos

08100 Grant making foundations P932900 Gambling Services nec

08100 Grant making foundations Q962900 Interest Groups nec

08210 Fundraising P932100 Lotteries

08210 Fundraising P932200 Casinos

08210 Fundraising P932900 Gambling Services nec

08210 Fundraising Q962900 Interest Groups nec

08220 Voluntarism promotion Q962900 Interest Groups nec

09100 International activities Q962900 Interest Groups nec

10100 Religious congregations and associations Q961000 Religious Organisations

11100 Business associations Q962100 Business and Professional Associations

11200 Professional associations Q962100 Business and Professional Associations

11300 Labour unions Q962200 Labour Associations

99100 Other No Equivalent Category

99444 Don’t know R994000 Don’t Know

99555 Refused to answer R995000 Refused to Answer

99777 Response unidentifi able R997000 Response Unidentifi able

99888 Response outside scope R998000 Response Outside Scope

99999 Not stated R999999 Not Stated

Note: nec means not elsewhere classifi ed.


114

Appendix 4 – Time Use Survey 1998/99: Purpose of organisation codesThe Time Use Survey codes formal unpaid work outside of the home into eight groups (seven categories plus a residual), based on the type of institution the work was done for. Although respondents wrote down which institution they worked for, the information was only coded in terms of these eight groups, meaning that we cannot map directly to all New Zealand Standard Classifi cation of Non-Profi t Organisation (NZSCNPO) groups. These Time Use Survey activity groups implicitly include formal unpaid work for government (such as for boards of trustees or the Department of Conservation). However, the design of the questions in the Time Use Survey suggests that formal unpaid work for non-profi t institutions is well recorded, while formal unpaid work for government institutions is possibly under-recorded. With no way to remove formal unpaid work for government, it has to be left in as a caveat.

The NZSCNPO and Time Use Survey activity groups have enough similarity to create a rough concordance between the two classifi cations.

Figure 14

1 Culture and recreation Leisure and recreation

2 Education and research Education

3 Health Disability support and health-related services,4 Social Services and Social support and assistance

5 Environment6 Development and housing7 Law, advocacy and politics Community safety and protection,8 Grant making, fundraising and voluntarism promotion Member benefit groups,9 International Mäori-based committee, organisation, 10 Religion grouping, etc, and Other.11 Business and professional associations, unions12 Not elsewhere classified

Time Use Survey 1998/99 activity group

NZSCNPO and Time Use Survey 1998/99 Activity Group Concordance

NZSCPO activity group

There are a number of issues that should be noted in this concordance:

● Culture and recreation, and leisure and recreation match very well.

● Time Use Survey activity group education probably contains the most formal unpaid work for government institutions, due to parents volunteering for the local public school. However, this may be mitigated by the voluntary activity possibly happening through a parent teacher association or a home and school association.

● NZSCNPO activity groups health and social services were combined because of the large overlap with disability support and health-related services and social support and assistance.

● The residual categories of NZSCNPO groups 5 to 12 cover all other formal voluntary labour, and the match is generally quite good, except for 24 hour emergency services, which fi ts better within social services.

● Mäori-based committee, institution, grouping etc has activities that to some extent should be assigned to other NZSCNPO groups, for example, teaching in a kohanga reo.


115

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Non-profit InstitutionsSatellite Account

2004

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2004

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