What will we do to achieve this outcome?

Intermediate outcome: State institutions deliver sustained performance improvement in results and capability

Delivering more progress on key results and better public services depends on ensuring the right mix of interventions (expenditure, regulatory and ownership) are in place and there is sustained performance improvement across the State sector. The Treasury has an important role to play in providing advice to the Government on the economic and financial implications of proposed and existing government interventions. It also has a role to play in supporting agencies to build their capability to better deliver results now and in the future.

As the Government's lead economic and financial advisor we will provide Ministers with advice on the benefits and costs of policy options, including on targeting resources to where there is greatest benefit or need. We aim to improve value for money, and to support agencies to deliver high-quality policy advice and regulatory assessments.

As a Central Agency, the Treasury works with SSC and DPMC to provide advice on the design of State institutions (the systems and structures of the State sector) and to support, and sometimes lead, changes to these. We want a public management system that is world leading in ensuring agencies have the incentives and capability to advise the Government on the right things to do and to do them in the most efficient and effective way. This is about both sound implementation and continuous improvement of this framework, as well as working with agencies, to lift performance in advising the Government and delivering services.

The Treasury has a particular focus on the Crown's overall balance sheet (outlined further under the intermediate outcome below) and ongoing operating expenditure. However, the Central Agencies are seeking to work together more collaboratively as a de facto "corporate head office" of the State sector. An example of Central Agency collaboration is the Performance Improvement Framework (PIF), which is focused on defining and measuring agency performance, as a basis for driving improvement.

The Better Public Services programme is the next phase in the Government's public sector reforms and is focused on getting the system working to deliver better results and improved services for New Zealanders, while at the same time continuing the work of recent years to reduce costs and increase efficiency. The Treasury will support the implementation of this programme; including supporting the legislative changes to the Public Finance Act 1989[3] required to enable greater collaboration around results and system leadership, and providing the support required to deliver the key results and increased efficiency.

Delivering the outcomes the Government is seeking within fiscal constraints will require changes in the way some services are delivered. A priority for the Treasury is providing advice on reforms that will result in changes to the way services are delivered to ensure that they deliver the desired efficiency and effectiveness improvements. For example, the Treasury has a key role to play in improving the effectiveness and efficiency of the welfare system as Cabinet has mandated the Treasury to have a joint lead of the overall welfare reforms (alongside MSD).

As the Government's lead financial advisor and the financial manager of the Crown's accounts, we also have a particular focus on improving the financial management capability of the State sector (including our own). A crucial element of high-quality financial management is the use of robust performance and value measurement that supports effectiveness and efficiency in resource use.

The Treasury will help the Government make focused investment and reprioritisation decisions, both across the State sector and within particular sectors and agencies, through our understanding of performance across the State sector and the way these services, sectors and agencies operate. We will work with agencies, both individually and through system-wide interventions, to improve performance. We will identify and promote benchmarking of agency activities and opportunities to raise productivity across the State service; for example, the Administrative and Support Services benchmarking exercise that the Treasury is now running annually. Alongside working with agencies to improve their performance, we also provide advice to the Government on the performance of key departments. Our focus and advice will vary over time depending on our assessment of the risks of underperformance and opportunities to improve performance. The Treasury will continue to provide guidance and support to agencies to ensure activities comply with the Public Finance Act 1989 and Cabinet directions.

Refer to Measures section below to see how we assess the Treasury's contribution.