Administration of Investment of Public Money PLA
Scope of Appropriation
This appropriation is limited to expenses incurred in connection with administering the investment of public money, as authorised by section 65J(1) of the Public Finance Act 1989.
Significant Work Completed During 2009/10
- As at 30 June 2010, NZDMO administered marketable securities valued at $4,142 million, deposits valued at $470 million and a cash balance of $8,053 million. Cash and securities were used to fund government operations, to provide short-term liquidity if required and to help repay bond maturities in the longer term.
- Asset holdings increased during the year as NZDMO pre-funded future borrowing needs, and invested the proceeds into fixed-income securities.
- Assets are invested primarily in AAA- and AA-rated securities. The high quality of the asset portfolio, in conjunction with NZDMO’s asset-liability matching policy, means the portfolio value had very low volatility, as reflected in an average monthly VaR during 2009/10 of less than $1 million.
| Performance Dimensions | Target | Performance for 2009/10 |
|---|---|---|
| All policy outputs comply with the Treasury's Quality Standards for Policy Advice, as assessed by the Minister three times during the year. | Rated as meeting and frequently exceeding expectations |
Not assessed in 2009/10. Refer to page 60 for further information on the application of the policy standard during 2009/10. |
| Compliance with risk management policies and parameters for portfolio management and debt issuance. | For other standards in this output class see the standards listed in the Administration of Crown Borrowing PLA output expense |
Performance targets for Administration of Derivative Transactions PLA, the Administration of Crown Borrowing PLA and Administration of Public Borrowing PLA have been aggregated. The performance targets were specified as a total activity across these output classes because this provided a more meaningful measure of the outputs produced by NZDMO. The full set of measures and targets for the 2009/10 year and relevant notes are published in the Administration of Crown Borrowing PLA. |
| 2009/10 Actual $000 |
Supp. Estimates - Voted $000 |
Main Estimates $000 |
2008/09 Actual $000 |
|||
|---|---|---|---|---|---|---|
| Expenses | 373 | 313 | 996 | |||
| Funded by: | ||||||
| Revenue Crown | 366 | 309 | 978 | |||
| Other Revenue | 7 | 4 | 18 | |||
In 2009/10, the Debt and Related Financial Asset Management output class was split across three PLA appropriations, and one annual output class. A summary of the PLA financials and the 2008/09 comparatives are provided on page 50.
Actual 2009/10 output class expenditure was $60,000 or 19% over the Supplementary Estimates budget owing to higher global custodial costs.
