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Purpose

This Explanatory Guide introduces New Zealand's state sector financial management system. The state sector includes the offices of Parliament, departments, Crown entities, state-owned enterprises (SOEs) and their subsidiaries. It excludes territorial local authorities (regional and local councils), all of which operate under separate legislation. The system includes the role and information needs of Parliament in approving and scrutinising government expenditure, the tools available to Ministers to focus public resources on the government's priorities and to set expectations of departments and other government agencies, and the role of departments in ensuring taxpayer's money is used appropriately (whether by the department in providing services itself or by the Crown entities and other organisations funded through departments).

The Explanatory Guide sets out how different aspects of the financial management and performance reporting systems work together to support the Government's aims, promote flexibility within constraints imposed by principles of fiscal responsibility and accountability, and ensure that public expenditures deliver the expected benefits to New Zealanders.

This document also shows how the financial management system ensures full and transparent reporting on the financial situation of the New Zealand Government. It is written for:

  • staff in Parliament, departments, Crown entities and SOEs
  • professionals and students who want an overview
  • interested members of the public
  • people from overseas who are interested in how the system works.
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