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Media Statement Treasury releases benchmarking report

13 Apr 2011

Andrew Kibblewhite
Deputy Chief Executive to the Treasury

The Treasury today released the results of a benchmarking exercise on administrative and support service performance in 33 state sector agencies. After an initial exercise with 14 state sector agencies using data from the 2008/09 financial year, benchmarking was extended to a total of 33 agencies using data from 2009/10 financial year. 

The report shows that the agencies spent about $1.8 billion on administrative and support services in the 2009/10 financial year and that there is a significant variation in service cost, efficiency, and effectiveness across agencies.

Treasury Deputy Chief Executive Andrew Kibblewhite said: “Spending levels across agencies are quite variable, ranging from between 3 percent to 36 percent of total organisation running costs. Some variation is attributable to agency size as smaller agencies are more affected by fixed costs, and some variation is due to the nature of agency operations.  For example, some agencies are in the midst of some significant ICT investments to transform public services and make them more efficient.  If we are to use this information constructively, we must consider it in light of each agency’s operational context.”

The report concludes that making these services more efficient can save more than $236 million a year and that service quality can also improve.  Key opportunities include leveraging knowledge and scale across agencies; streamlining, automating, and standardising processes, and having more common systems.

Mr. Kibblewhite said “we don’t just want efficiency improvements. We also want to see these functions playing a more strategic role in their organisations.  In times like these, chief executives need CIOs, CFOs, and heads of procurement and HR helping them understand their business and make decisions that lift agency performance and reduce agency costs.”

Benchmarking of administrative and support services will be done annually, with the results providing valuable trend information and demonstrating the impact of State sector efficiency efforts over time. Mr. Kibblewhite said “the quality and transparency of information from the benchmarking exercise will enable robust, evidence-based decisions about how we do business and help identify opportunities for improvement.”

Administrative & Support Services Benchmarking Report for FY 2008/09 and FY 2009/10

ENDS

Officer for Enquiries

Rebecca Whyte | Sector Performance Portfolio
Tel: +64 4 917 6192
Fax: +64 4 473 0982
Email: rebecca.whyte@treasury.govt.nz
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