The Treasury will continue to progress work with government departments and other Crown agencies to further strengthen Crown balance sheet management and decision making following amendments to the Public Finance Act late last year.
"Like in many countries around the world, public sector agencies and governments in New Zealand need to improve their focus on the better use of capital,” Secretary to the Treasury, Gabriel Makhlouf, said today.
The Treasury today published its 2014 Investment Statement, a statutorily-required report card on the Crown’s balance sheet of what it owns and owes.
"We have a solid record of a well functioning public finance management system which has helped cushion New Zealanders from the full brunt of recent economic and financial shocks and natural disasters.
"But it is also true that there is scope for further strengthening of Crown balance sheet management practices. New Zealanders would benefit from having a greater understanding of performance across the portfolio of Crown assets and liabilities because it would assist with delivering value for money.
"Our capital management practices and expectations need to be stronger to complement our strong fiscal accountability standards for operating expenses,” Gabriel Makhlouf said.
Conclusions in the Investment Statement include that the Crown’s balance sheet has been growing over the past 20 years and this will continue in the future. Individual agencies’ asset performance measurement and monitoring of their own asset bases and investing activities has been improving in recent years, but it is still not as comprehensive as it could be to provide the information required to more fully assess opportunities and risks to the Crown’s overall position.
"Owning the right assets, managing them well, funding them sustainably, and managing risks to the Crown balance sheet, are all critical to the provision of high-quality and cost-effective public services. In particular, the coming demographic challenges mean that the quality of balance sheet management will become increasingly important to underpinning New Zealanders’ living standards now and in the future,” he said.
"Creating systems for better information collection and evaluation will be a priority for the Treasury in its work with agencies in the years ahead. The next Investment Statement, required no later than four years from now, will outline how public sector organisations have made progress on this important work,” he said.
Link to 2014 Investment Statement.