5 May 2021

New team best placed to oversee government spending - Grant Robertson

10:03 am on 5 May 2021

Finance Minister Grant Robertson is standing by a new implementation unit being set up to monitor the government's delivery on promises.

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Grant Robertson says Treasury is working hard to get information from departments as early as possible so that funds allocated can be accounted for. Photo: RNZ / Dom Thomas

Yesterday, Robertson announced that $926 million in savings have been identified from a review of the $62 billion allocated to last year's Covid-19 Response and Recovery fund.

Robertson also said that the prime minister had tasked him with leading a new implementation unit to ensure the government was tackling its core priorities; housing affordability, climate change and child wellbeing.

Asked today how the $926m had been found, Robertson told Morning Report that at the end of last year when Budget preparations began, ministers were asked to ensure that money allocated to their ministries was still a priority and as a result $926m in savings had been identified.

Robertson defended the way the system was working.

It was working as intended when it was set up in the Public Finance Act in 1989, with each government department responsible for its spending and accountable to Parliament through the annual review process, Robertson said.

"What the Treasury is responsible for is the aggregate level of spending that a department does and whether that equals up to what they're allowed to spend.

"We've been talking to the Auditor-General because we appreciate that these are very large sums of money that have been put in place..."

Treasury was working hard to get information from departments as early as possible so that funds allocated could be accounted for.

The system had worked in this way for decades. Major parts of spending of the Covid-19 fund were known such as $14b paid out for the wage subsidy scheme, $2b for the small business cashflow scheme "but some of those more detailed parts within programmes usually only emerge through the annual review process".

The way that the Public Finance Act was set up meant a series of "siloed government departments" had been created and he was working to modernise it so that more was known about programmes, especially where agencies worked together.

It was one of the reasons why the new implementation team was announced yesterday, which would be better placed to oversee the work of multiple agencies, he said.

"In terms of these big multi-agency programmes, I think it's actually best practice to have a small unit of people who are supporting ministers and agencies to meet milestones and deliver."

The National party has called the new unit a vote of no confidence in other Cabinet ministers.

But Roberston said ministers would still have responsibilities and be answerable to Cabinet.

When governments change and there are new types of programmes set up, it takes time for the public service to "ramp it up". One example was the Provincial Growth Fund which saw regional development being done to a scale that had not been tackled in years, he said.

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