Reference: 20210435
15 October 2021
Graham Burger
[FYI request #16547 email]>
Dear Graham
Thank you for your Official Information Act request (OIA), received on 17 September
2021. You requested the following:
Have any COVID19 vaccine manufacturers been provided with liability waivers of
any kind, including negligence by the NZ government or any agency? Please
provide details of any such waivers and the companies and agencies involved.
The Ministry of Health transferred part of your request to the Treasury under section
14(b)(ii) of the OIA.
The Ministry of Health also transferred part of the request to the Ministry of Business,
Innovation and Employment under section 14(b)(ii) of the OIA.
Information being released
Please find enclosed the following document:
Date
Document Description
Decision
9 August 2021
Donating AstraZeneca COVID-19
Release in part
vaccines to the COVAX Advance
Market Commitment: indemnity
request from MOH/MFAT - Gavi
I have decided to release the relevant parts of the document listed above, subject to
information being withheld under one or more of the following sections of the OIA, as
applicable:
certain sensitive advice under section 6(b)(ii) – to prejudice the entrusting of
information to the Government of New Zealand on a basis of confidence by an
international organisation,
personal contact details of officials under section 9(2)(a) – to protect the privacy
of natural persons, including that of deceased natural persons,
commercially sensitive information under section 9(2)(b)(ii) – to protect the
commercial position of the person who supplied the information, or who is the
subject of the information,
1 The Terrace
PO Box 3724
Wellington 6140
New Zealand
tel. +64-4-472-2733
https://treasury.govt.nz
confidential information under section 9(2)(f)(iv) – to maintain the current
constitutional conventions protecting the confidentiality of advice tendered by
Ministers of the Crown and officials,
certain confidential information under section 9(2)(ba)(i) – where the release of
that information would be likely to prejudice the supply of similar information, or
information from the same source, and it is in the public interest that such
information should continue to be supplied, and
direct dial phone numbers of officials under section 9(2)(k) – to prevent the
disclosure of information for improper gain or improper advantage.
Direct dial phone numbers of officials have been redacted under section 9(2)(k) in
order to reduce the possibility of staff being exposed to phishing and other scams. This
is because information released under the OIA may end up in the public domain, for
example, on websites including Treasury’s website
Information publicly available
The following information is also covered by your request and will soon be publicly
available on the Treasury website:
Ite
Date
Document Description
Website
m
1. 27 May 2021
Donating AstraZeneca doses
https://www.treasury.govt.nz/
to the COVAX Facility:
publications
Indemnity request from
MFAT/MOH
2. 29 April 2021
Polynesian COVID-19 vaccine
https://www.treasury.govt.nz/
roll-out: Indemnity request from publications
MFAT/MOH – Pfizer New
Zealand Limited / BioNTech
Accordingly, I have refused your request for the documents listed in the above table
under section 18(d) of the OIA:
the information requested is or will soon be publicly
available.
Please note that this letter (with your personal details removed) and enclosed
documents may be published on the Treasury website.
This reply addresses the information you requested. You have the right to ask the
Ombudsman to investigate and review my decision.
Yours sincerely
Conor McBride
Team Leader, International
2
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Treasury Report: Donating AstraZeneca COVID-19 vaccines to the
COVAX Advance Market Commitment: indemnity
request from MOH/MFAT - Gavi
Date:
9 August 2021
Report No:
T2021/1882
File Number:
SH-1-6-1-3-3-13-1
Action sought
Action sought
Deadline
Hon Grant Robertson
Agree to provide an indemnity to
11 August 2021
Minister of Finance
Gavi, the Vaccine Alliance, for
ancillary costs associated with the
donation of AstraZeneca doses to
the COVAX Facility.
Sign the attached grant agreement.
Contact for telephone discussion (if required)
Name Position
Telephone 1st
Contact
Hugo Van Dyke
Senior Analyst,
s9(2)(k)
N/A
International
(wk)
(mob)
Conor McBride
Team Leader,
s9(2)(k)
N/A
International
(wk)
(mob)
Minister’s Office actions (if required)
Return the signed report to Treasury.
Sign the attached grant agreement and return to Treasury.
Note any
feedback on
the quality of
the report
Enclosure:
Yes (attached)
Treasury:4488702v2
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Treasury Report: Donating AstraZeneca COVID-19 vaccines to the
COVAX Advance Market Commitment: indemnity request from
MOH/MFAT - Gavi
Executive Summary
This report seeks your approval to provide Gavi, the Vaccine Alliance (Gavi) with an
indemnity for the payment of ancillary costs for donating up to 7,600,000 COVID-19 vaccine
doses from our Advance Purchase Agreement (APA) with AstraZeneca (AZ) to the COVAX
Facility (COVAX) for distribution by the COVAX Advanced Market Commitment (AMC).
This indemnity is similar to the indemnity you approved for donating 1,668,000 COVAX-
sourced AZ doses to the AMC, earmarked to the Pacific [T2021/1225 refers].
Vaccine Ministers have agreed to donate a further 1,000,000 AZ doses
On 27 July 2021, Vaccine Ministers agreed [HR-2021-1664 refers]:
•
to donate the
delivery of the AZ vaccine of up to 1,000,000 doses to the AMC, and
s9(2)(b)(ii)
•
the donated doses would be earmarked for countries in the Pacific region as absorptive
capacity allows and any surplus doses would be for distribution to other COVAX AMC
countries worldwide, according to the WHO Allocation Mechanism.
The grant agreement for donating these AZ doses requires New Zealand to pay
ancillary costs and includes an indemnity for failure to pay those costs
The attached grant agreement for donating these doses will require New Zealand to:
•
pay 6(b)(ii) 9(2)(ba)(i)
for ancillary costs associated with delivering the donation,
6(b)(ii) 9(2)(ba)(i)
Payment of these ancillary
6(b)(ii)
costs will be funded from Vote Foreign Affairs and will allow Gavi to prioritise its 9(2)(ba)(i)
resources towards mobilising the maximum number of doses, and
•
indemnify Gavi for any costs, losses or liabilities incurred as a result of New Zealand
failing to pay these ancillary costs.
The grant agreement will apply to the initial donation of up to 1,000,000 doses (up to
6(b)(ii) 9(2)(ba)(i)
and any future donation of APA-sourced AZ doses New Zealand elects to pay
ancillary costs for (up to 6(b)(ii) 9(2)(ba)(i)
for 7,600,000 doses, including the initial 1,000,000).
Future donations will be subject to agreement by Vaccine Ministers but will not require further
indemnity approvals from you.
Officials consider that this indemnity meets the public interest test
To provide this indemnity, you (as Minister of Finance) will need to be satisfied that the
indemnity meets the public interest test under section 65ZD of the Public Finance Act 1989.
We consider that the indemnity satisfies the public interest test. The indemnity is low risk and
benefits New Zealand as it expedites the rate at which doses are distributed to:
•
the Pacific, which reduces the region’s reliance on the aid programme, and
•
worldwide, which supports the global recovery and our reconnection with the world.
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Recommended Action
We recommend that you:
a
note that on 27 July 2021 Vaccine Ministers agreed to donate up to 1,000,000 doses of
the AstraZeneca (AZ) vaccine procured through our bilateral advanced purchase
agreement (APA) to the COVAX Advance Market Commitment (AMC) [HR-2021-1664
refers]
b
note that Vaccine Ministers have agreed to allocate these doses to COVAX AMC Eligible
Economies in the Pacific region with first priority accorded to meeting New Zealand’s
commitments to Tonga, Fiji, Solomon Islands, Vanuatu, and Kiribati, as absorptive
capacity allows, and any surplus doses would be available for distribution to AMC-eligible
countries worldwide
c
note that the attached grant agreement (
Annex Two) allows Gavi, the Vaccine Alliance
(Gavi) to invoice New Zealand for ancillary costs associated with donating APA sourced
AZ doses, including the no fault compensation levy, safe injection equipment and freight
(totalling 6(b)(ii) 9(2)(ba)(i)
d
note that the Ministry of Health will initially incur the ancillary costs associated with the
donation of AZ doses to the AMC and will subsequently invoice the Ministry of Foreign
Affairs and Trade with the payment being met from Vote Foreign Affairs
e
note that the grant agreement requires New Zealand to indemnify Gavi for costs, losses
or liabilities incurred by Gavi as a result of New Zealand failing to pay the grant payment
(that is, the payment for ancillary costs) or failing to pay the correct amount; this is in line
with the indemnities previously granted in the COVAX Commitment Agreement
f
note that, while the donation referred to in recommendation (a) above is for 1,000,000
doses, the grant agreement, including the indemnity, will apply to all APA-sourced AZ
doses (7,600,000, including the initial 1,000,000) that New Zealand agrees to donate to
the AMC and pay ancillary costs to Gavi for
g s9(2)(f)(iv)
h
note that the indemnity is not within the permitted categories of indemnity that the
Ministry of Foreign Affairs and Trade (MFAT) or Ministry of Health (MOH) can give under
section 65ZE of the Public Finance Act 1989
i
note that under section 65ZD of the Public Finance Act 1989, the Minister of Finance
may, on behalf of the Crown, give an indemnity “if it appears to the Minister to be
necessary or expedient in the public interest to do so”
j
note that officials consider the provision of this indemnity to Gavi meets the public
interest test because:
i.
providing for ancillary costs avoids our donation becoming a drain on the AMC’s
resources intended to fund the purchase of vaccines for developing countries,
and allows the AMC to mobilise the doses as quickly and safely as possible,
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ii.
it is considered preferable that New Zealand provides support to the Pacific
region to access vaccines as soon as possible in order to lessening their reliance
on New Zealand’s aid programme in the event of a COVID-19 outbreak or further
border closures, and
iii. supporting developing countries more broadly to increase vaccination rates
worldwide improves New Zealand’s ability to reconnect with the rest of the world
k
note that New Zealand can wholly mitigate the risk of this indemnity being called upon
because it is within our control to make the relevant payments on time and for the correct
amount
l
agree to provide an indemnity to Gavi in respect of the ancillary costs associated with
donating AZ doses to the AMC under section 65ZD of the Public Finance Act 1989 by
signing the attached grant agreement
Agree/disagree.
m
sign the attached grant agreement (
Annex Two) to give effect to your decision to
provide the indemnity, above
Conor McBride
Team Leader, International
Hon Grant Robertson
Minister of Finance
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Treasury Report: Donating AstraZeneca COVID-19 vaccines to the
COVAX Advance Market Commitment: indemnity
request from MOH/MFAT - Gavi
Purpose of Report
1.
This report seeks your approval to provide Gavi, the Vaccine Alliance (Gavi) with an
indemnity for the payment of ancillary costs associated with donating up to 7,600,000
doses of the AstraZeneca (AZ) COVID-19 vaccine to the COVAX Facility (COVAX) for
distribution by the COVAX Advanced Market Commitment (AMC).
2.
This indemnity provides an extra level of assurance to Gavi that New Zealand will pay
the ancillary costs as promised in our agreement. Officials consider the risk of
triggering this indemnity is low because New Zealand is in control of making the
required payments and we can therefore ensure these payments amounts are accurate
and made on time.
Background
Previous donations to the Pacific
3.
In May 2020, New Zealand committed to support regional and global access to COVID-
19 vaccines [CAB-20-MIN-0382 refers] and to ensure our Pacific neighbours have
timely access to a vaccine. Since then, New Zealand has entered into advanced
purchase agreements (APAs) with four vaccine companies.
4.
To date, this support has been through a combination of bilateral donation directly to
Polynesian countries1, and donation via the AMC:
a In February 2021, Vaccine Ministers agreed to provide Polynesian countries with
access to New Zealand’s vaccine portfolio [HR20210373 refers] and in April you
agreed to indemnify Pfizer New Zealand Limited / BioNTech (Pfizer) s9(2)(b)(ii)
s9(2)(b)(ii)
s9(2)(b)(ii)
T2021/1040 refers]. Since then, at least 25,800
Pfizer doses have been delivered to the Realm (Cook Islands, Niue, and Tokelau).
The Realm are near completing their vaccine rollouts to their eligible populations.
b In April 2021, Vaccine Ministers agreed to donate 1,668,000 doses of the AZ
s9(2)(b)(ii) vaccine to the AMC s9(2)(b)(ii)
which would be earmarked for the Pacific, and in
May you agreed to indemnify Gavi for ancillary costs associated with donating those
vaccines, should they arise [T2021/1225 refers]. These doses were purchased
through COVAX [MBIE-2021-1847 refers]. So far, 211,200 doses have been
delivered to Tonga, Tuvalu, Fiji, Papua New Guinea, Solomon Islands and Timor-
Leste.
Further donations to the AMC
1 The Cook Islands, Niue, Tokelau, Samoa, Tonga and Tuvalu
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s9(2)(b)(ii)
5.
On 27 July 2021, Vaccine Ministers agreed to donate our
of AZ of up to
an additional 1,000,000 doses (
) to the AMC [HR20211664 refers]. The
doses are a portion of the 7,600,000 doses that were originally sourced through a s9(2)(b)(ii)
bilateral advanced purchase arrangement (APA) between New Zealand and AZ last
year [T2020/3585 refers].
s9(2)(b)(ii)
6.
Vaccine Ministers have agreed to distribute the
doses amongst AMC Eligible
Economies in the Pacific region2, as absorptive capacity allows, with first priority
accorded to meeting New Zealand’s commitments to Tonga, Fiji, Solomon Islands,
Vanuatu, and Kiribati. Any volumes surplus to Pacific countries’ needs would be
available for distribution to other COVAX AMC countries according to the WHO
Allocation Mechanism3.
7.
Under the bilateral APA purchase of these AZ doses, New Zealand indemnified AZ in
respect of the distribution, administration, use and manufacturing of the doses. The
tripartite dose sharing agreement between Gavi, New Zealand and AZ in respect of
proposed donations will provide that AZ releases New Zealand from this liability in
respect of any AZ doses donated to COVAX.
The terms of the grant agreement for this donation are similar to the grant
agreement for donating the
doses s9(2)(b)(ii)
8.
The attached grant agreement (
Annex Two) allows Gavi to invoice New Zealand for
ancillary costs associated with the donation, including the no fault compensation levy,
safe injection equipment and freight 6(b)(ii) 9(2)(ba)(i)
These ancillary costs
will be funded from Vote Foreign Affairs baselines.
s9(2)(b)(ii)
9.
The terms of the grant agreement are similar to the previous grant agreement for the
donation of
doses, under which you also agreed to an indemnity to cover the
ancillary costs associated with donation. In summary, the key terms for the grant
agreement to donate the
doses were that New Zealand agreed to:
s9(2)(b)(ii)
a pay Gavi ancillary costs associated with donating the doses. While these ancillary
costs are optional, Vaccine Ministers agreed to make these payments in accordance
with the principle of good donorship to reduce the financial burden on COVAX and
to support our request that doses be earmarked for the Pacific [HR20211664 refers];
and
b indemnify Gavi for any costs, losses or liabilities incurred as a result of New Zealand
failing to pay the ancillary costs correctly.
s9(2)(b)(ii)
10. The differences between the terms of this (
) agreement and the previous (
doses) agreement are that:
6(b)(ii) 9(2)(ba)(i)
b while Gavi will earmark donated doses for AMC eligible economies in the Pacific, if
the donated doses exceed the absorptive capacity of those economies (which is
2 Kiribati, Micronesia, Solomon Islands, Papua New Guinea, Timor-Leste, Vanuatu, Fiji, Marshall
Islands, Samoa, Tonga, Tuvalu.
3 Countries with the lowest vaccination coverage through COVAX will be prioritised
4 These costs cover the COVAX AMC no-fault compensation levy, safe injection equipment costs and
freight.
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s9(2)(b)(ii)
anticipated, with respect to the
doses and almost certainly will with respect to the
remaining 6,600,000 doses), the remainder will be available for wider distribution to
eligible economies to the AMC according to the WHO Allocation Mechanism; and
c this agreement, and associated indemnity, will apply for any donation of APA-
sourced AZ doses where New Zealand elects to pay the ancillary costs (i.e. if
Vaccine Ministers subsequently agree to donate any of the remaining 6,600,000 or
more AZ doses then the terms of this agreement would apply).
Proposed indemnity
11. This indemnity is to provide assurance to Gavi that New Zealand will pay the agreed-
upon ancillary costs associated with donating AZ doses at 6(b)(ii) 9(2)(ba)(i)
– this
includes the AMC no fault compensation levy, safe injection equipment and freight.
Initially this would apply to the
doses only, but it would also apply to any of the
remaining 6,600,000 or more AZ doses, should New Zealand agree to donate them
and pay ancillary costs to Gavi. s9(2)(b)(ii)
12. The indemnity provisions are set out below and in clauses 6.1 and 6.2 of the grant
agreement (
Annex Two). These are identical to the previous indemnity you provided to
Gavi for donation to the COVAX AMC [T2021/1225 refers].
6(b)(ii) 9(2)(ba)(i)
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Officials consider that your approval to the proposed indemnity satisfies the
public interest test under the Public Finance Act 1989
13. It is a matter for you (as Minister of Finance) to decide whether or not you are satisfied
that it is necessary or expedient in the public interest to indemnify Gavi on the terms
outlined in paragraph 12.
14. Officials consider that giving the requested indemnity on the terms set out in
paragraph 12 to enable fully funded dose donation through the AMC satisfies the
“necessary or expedient in the public interest” test in section 65ZD of the Public
Finance Act 1989, for reasons set out below and in the business case at
Annex One.
a
It supports global recovery from the COVID-19 pandemic and New Zealand
reconnecting with the rest of the world: it will expedite the rate at which doses are
rolled out to countries in the COVAX AMC, increasing immunisation rates in
countries that need it. It also encourages other donors to support roll out of
unearmarked donated doses.
b
Supporting this multilateral approach to donating vaccines shows our commitment to
the global equitable access to vaccines and promotes cooperation in this space: fully funding our donation will increase Gavi’s resources to purchase more vaccines
for COVAX AMC thus helping to increase the supply of vaccines to other countries,
which include our Pacific neighbours.
c
It is a better use of New Zealand’s public resources: in the case of doses being
donated to the Pacific, New Zealand would likely be required to cover some of the
costs of a COVID-19 outbreak in the region. Earlier roll out of vaccines in the region
will reduce the likelihood of that occurring, speed up border re-openings and
increase economic stability.
d
This indemnity has a low risk of being called upon: New Zealand has complete
control over whether this indemnity will be called upon because we can ensure the
payments are paid on time and for the accurate amount.
15. Officials also consider the donation to be expedient because of the rapidly evolving
global situation including in Pacific countries like Fiji.
Financial implications and mitigations
16. The
financial
liability for taking on this indemnity as it applies to the
doses is the
total cost of grant payment for ancillary costs, which will be:
s9(2)(b)(ii)
6(b)(ii) 9(2)(ba)(i)
b any costs incurred by Gavi as a result of New Zealand failing to meet its payment
obligations, such as costs associated with Gavi finding an alternative funding
source.
17. If New Zealand makes future donations of APA-sourced AZ doses to COVAX and
elects to pay ancillary costs under the same grant agreement, the financial liability
would increase to up to 6(b)(ii) 9(2)(ba)(i)
plus other costs incurred by Gavi from New
Zealand failing to meet a payment obligation.
18. Finally, New Zealand is in control of making the required payments, so officials will
mitigate the risk by ensuring the payments are made on time and for the accurate
amount.
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Next steps
19. If you agree that it is necessary or expedient in the public interest to give the indemnity
you will need to sign the indemnity provisions within the grant agreement at
Annex
Two.
20. Once the grant agreement and other related contracts are signed, this will enable Gavi
to progress with planning to accept and implement New Zealand’s donation of up to
1,000,000 AZ doses
Any AZ donations in addition to the initial 1,000,000 will be
subject to agreement by Vaccine Ministers but will not require further indemnity
approvals from you.
s9(2)(b)(ii)
21. Officials are currently working on what the global vaccine programme will look like for
next year and what New Zealand’s commitments will be to the Pacific and other
countries. We will update you on this as we begin to have a clearer picture.
Annex 1- refer to initial request made to MoH
Annex 2 - withheld under s9(2)(b)(ii)
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Document Outline