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Chief Executive's Introduction

I took up my appointment as Secretary in June 2011 and am delighted, and honoured, to be given the privilege of leading the Treasury. I look forward to working with everyone in the Treasury to achieve our ambitious objective of higher living standards for New Zealanders.

We're at an important historic juncture as the centre of gravity of the world economy moves closer to New Zealand. The re-emergence of China and India as regional centres of economic strength, the growth in the Asia-Pacific region in general, the growing demand for our commodity exports and the arrival of technology that brings us closer to the rest of the world create a "perfect storm of opportunity" for the country's future.

The Treasury has a vital role to play in helping the country seize these opportunities and improve its living standards.

We live in interesting times. Earlier this year, the consensus among economists was that the international economy was recovering nicely. Share prices were rising and financial markets were anticipating that central banks would shortly return monetary policy settings to something approaching pre-global financial crisis normality.

However, within a matter of weeks, the US economy started to stumble and the focus of the financial markets again turned to the outlook for Euro-zone economies - serving to reinforce the Treasury's critical role in providing quality and timely advice to our Minister.

An Eventful Year

The 2010/11 year was an eventful one. With our advice and assistance being increasingly sought across a range of activity, the Treasury took on additional roles, and May featured two events of particular note - our flagship Budget production, and the departure of Secretary John Whitehead.

Budget 2011 was noteworthy for its forecast for a return to surplus in 2014/15 - one year earlier than previously expected. This was achieved despite the impacts of the Canterbury earthquakes, the slower economic recovery and various other economic setbacks.

A fortnight later, we farewelled Secretary of eight years, John Whitehead, who has taken up the position of Executive Director to the World Bank in Washington. The role represents a strategic opportunity for New Zealand, and will help develop our country's networks and raise its profile for the wider benefit of our public service.

The year also featured two new initiatives: the establishment of the Treasury Board, and the inaugural Tri-Treasury Conference.

The New Treasury Board

The first meeting of the Treasury Board was held in October 2010. The Board's focus on strategic issues affecting the organisation brings a governance lens to our business, particularly in holding us to account for our performance. The value of a governance board is in taking decisions on strategic issues, strategic direction and organisational management.

The Tri-Treasury Conference

In February, we were honoured to host the first Tri-Treasury Conference, a gathering of the heads of the New Zealand, Australian and United Kingdom Treasuries. The opportunity to canvass a range of pressing economic and financial issues, and to hear their perspectives on some of the big challenges we are all facing, was invaluable.

Our Evolving Role

The Treasury's core work is to improve the living standards of New Zealanders through its three outcomes: Improving New Zealand's Economic Performance; A High-performing State Sector that Supports New Zealand's International Competitiveness; and A Stable and Sustainable Macroeconomic Environment.

Our role is evolving, however, and over 2010/11, the Treasury took on additional responsibilities. Our Earthquake Coordination Team was established to help with Canterbury response efforts through the provision of information and advice to Ministers. Work continues on the receivership of South Canterbury Finance (SCF) and the support package for AMI Insurance (AMI), and the Crown Ownership Monitoring Unit (COMU) has been tasked with formulating advice on the Mixed Ownership Model.

A small Treasury team performed the establishment work necessary to set up the Productivity Commission, and Treasury staff supported the Welfare Working Group and Savings Working Group in delivering their final reports. The National Infrastructure Unit (NIU) completed the second National Infrastructure Plan, which was launched at a parliamentary reception.

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