Obligations for use of NLTF funds

Archive - this information is for reference only and no longer maintained.

This page relates to the 2018-21 National Land Transport Programme.

Introduction

This section sets out the obligations of those using National Land Transport Fund (NLTF) funds.

Planning investment principles

All decisions and actions involving the use of NLTF funds are to be made by applying Waka Kotahi NZ Transport Agency's planning and investment principles.

These set out requirements, expectations and guidance for Waka Kotahi and approved organisations in exercising their planning and investment functions in the use of NLTF funds.

Exercising delegations

Those making decisions under delegation shall ensure that they meet Waka Kotahi expectations for exercising delegations, detailed in the delegations summary.

Delivery as approved

Where NLTF funds have been approved against an activity or combination of activities, Waka Kotahi expects that all organisations will deliver to the annual cash-flow plan approved as part of the funding approval.

Claiming for work completed

In the delivery of approved activities, all approved organisations and Waka Kotahi (national programmes and state highways) will claim promptly and regularly for any work completed.

Waka Kotahi acknowledges that the seasonal pattern of some work will impact the timing of some claims.

Benefits of prompt regular claiming
There are benefits to both approved organisations and Waka Kotahi from prompt and regular claiming, being:
- for the approved organisation - more efficient use of ratepayer/ debt funding through sensible cashflow management practice,
- for Waka Kotahi - less uncertainty around the year end position and full utilisation of funding with a reduced need for a large risk cash-flow buffer.
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Claims on accrual basis

Claims can be made on an accrual basis as work is completed, ie there is no need for approved organisations to hold off making claims until they receive their supplier invoices. See Compile claim and submit in TIO for further information.
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End of year claiming

Claiming behaviour that results in substantially higher, 'catch-up' claims for the last month of the financial year is viewed as unacceptable. Waka Kotahi reserves the right to defer payment of end of year (June and July supplementary) claims where these exceed 15% of the approved organisation's total claim for a year.
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Monitoring of progress

All organisations are required to regularly monitor their progress against approved projects and programmes.

Forecasting

All organisations are expected to forecast the timing and size of their claims or funding requirements.

Robust forecasting as a habit is vital as:

for the organisation, it is a fundamental part of its management of forward funding requirements from rate-payers, Waka Kotahi and other sources
for Waka Kotahi, it is critical to its debt and cashflow management.

Approved organisations are required to provide forecasts through Transport Investment Online(external link) (TIO) programme monitor each quarter of when they expect to make claims and the size of those claims.

Waka Kotahi (state highways) is required to provide monthly forecasts on expected activity class expenditure and property revenue.

Prompt requests for adjustments

Monitoring of progress and forecasting of claims should provide all organisations with a view of the need to apply for an adjustment of their projects/programmes through cost scope and cashflow adjustments.

Organisations must inform their Waka Kotahi representative as soon as they are aware of the need for any cost scope or cash flow adjustment. This includes the release of any surplus funds that are not required to deliver the planned activity or activities.

Some organisations may be reluctant to forecast or declare surplus funds as they may need them later should the cost of the approved activity be higher than their latest forecast. Waka Kotahi commits that, where an organisation declares surplus funds and later finds that it requires some or all of those funds to deliver its approved activity or activities, that organisation will have first call on available NLTF funds to enable it to complete delivery.

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