Room for improvement in state sector back office

A report benchmarking the administrative and support functions of state sector agencies shows they are starting to control their back office costs, but there is room for improvement, Finance Minister Bill English says.

Delivering better public services to New Zealanders is one of the Government's main priorities over the next three years.

"New Zealanders rightly expect a world-class health service, an education system that delivers for every child, a strong and effective justice system and social services that protect our most vulnerable and provide children from all walks of life with the opportunities they need to succeed," Mr English says.

"To achieve this we need state sector agencies to become truly focused on, and organised around, meeting the priority needs of families and businesses, and doing so within tight budgets.

"One part of delivering better public services is ensuring money is not unnecessarily spent on back office administration, when redirecting it to front line services would yield better results.

"The second annual Administrative and Support Services Benchmarking report is an important tool for chief executives to understand their organisations properly before they make change.

"It shows back office costs have been fairly flat in the last year, but there is ample room for future savings. Over the next year, I’d expect agencies to make more back office savings to free up money for priority front line services.

"In Budget 2011 we announced that from 1 July 2012 agencies will be required to find $980 million of savings over three years to reinvest in frontline services.

"Benchmarking costs will continue to challenge chief executives to lift their game and look at other ways of providing back office support," Mr English says.

The report is available at: www.treasury.govt.nz/statesector/performance/bass/benchmarking.