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Annual Report of the Treasury for the Year Ended 30 June 2014

Chief Executive's Introduction

Welcome to the Treasury's Annual Report for 2013/14.

The past year saw our economy continue to grow strongly, and we are forecasting solid growth at an average of 2.8% over the next four years. At the same time, the Crown's books are on the brink of returning to an operating surplus that will grow bigger in the years ahead.

This outlook for the New Zealand economy and the Government's finances stacks up very well against most of the countries to which we like to compare ourselves. We have good cause to be optimistic. Nevertheless, there is good cause to be cautious too. Growth in the global economy remains fragile, with the possibility of further economic and financial market turbulence. We also need to make prudent use of the Government's improved financial position to reduce debt and restore the buffer that helped New Zealand manage the double blow of the Canterbury earthquakes and the global financial crisis.

In this environment the Treasury's three overarching outcomes remain as relevant as ever: improved economic performance; a stable and sustainable macroeconomic environment; and a higher performing State sector that New Zealanders trust, delivering outstanding results and value for money. By working hard to achieve these outcomes, the Treasury can help ensure the country enjoys sustainable and inclusive growth for the long term and contribute towards higher living standards for New Zealanders.

A recent Performance Improvement Framework (PIF) review recognised the substantial amount of good work and progress by the Treasury in 2013/14, and you will see much evidence of that in this Annual Report. Some of the examples noted in the PIF include our work on housing and social welfare reform, our economic and financial advice to the Government, our leadership role in developing the Living Standards Framework and our engagement with Ministers. The Annual Report covers further highlights of the year too, such as our management of the Government Share Offer Programme (GSO), enhancements to our commercial analysis and advice, the publication of our first Investment Statement and a pilot joint venture with the Ministry of Business, Innovation and Employment (MBIE) and Te Puni Kōkiri on Māori economic development.

These achievements and many others are something of which the Treasury can be proud. They would not be possible without the dedication and expertise shown by Treasury staff throughout the year.

The PIF also indicated where the Treasury could lift its performance. In particular, there is scope for improvement in the areas of leadership and workforce development, management of our people and improving our effectiveness and efficiency. We are committed to doing better in these areas, and it is heartening that the PIF affirms the Treasury is already headed in the right direction to become an even more effective organisation.

On a personal note, I was asked recently by a young public servant what tips I would give to someone wanting to become Secretary to the Treasury. The gist of my response was to be ambitious for yourself, your community and your country; work hard; and do your job to the best of your ability. On reflection, this response applies just as much to the success of the Treasury. We are focused on our own continuous improvement, on lifting the performance and impact of our public sector "community" and on increasing the wellbeing of New Zealand and New Zealanders. This Annual Report shows the results of the hard work by Treasury staff in the past year, and we will draw on all of our capabilities to ensure the year ahead is even better.

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