Minister of State Services - Opening address State Services Senior Leaders Development Conference

  • Tony Ryall
State Services

Thank you for the opportunity to speak to you this morning to open your conference - "Performance Improvement - Leading through Tough Times."

As you are aware the focus of this government is on delivering better, smarter public services with limited resources.

Make no mistake - the Government is strongly committed to maintaining the integrity of New Zealand's public service. Recognising it is world respected, strong, and professional with a reputation for leadership and integrity.

And in these tough times that goal is doubly important.

As senior leaders in the State Services - it will be up to you to drive that performance improvement - in your own agencies and across your sectors.

All Governments always want to do better for taxpayers, and that is our goal too.

You have an excellent conference programme today.

Its focus is on improving frontline services. I would encourage you to make full use of it:

  • To share your experiences and lessons
  • To pick up new and proven methods for improving performance and improving service delivery
  • To gain information and contacts that will help you - individually and collectively - to provide better frontline services for New Zealanders.

You have an impressive range of high calibre speakers - from both the private and State sectors.

This is an excellent opportunity to learn and to challenge.

Economic Situation

There has been encouraging news recently that we are coming out of the recession.

But the impact of the worst global financial crisis in 70 years will be with us for some years yet.

The worldwide downturn has had such a profound effect on our economy. The large government surpluses of recent years have been replaced by equally large deficits.

And they're forecast to last another four years at least.

But this is not unique to New Zealand.

Overseas Situation

Massive reductions in Government revenues are making themselves felt all around the world. 

And public services are feeling the pinch. 

Dramatic decisions are being reported. A new austerity drive is sweeping across Europe.

In the UK, the Government is freezing Civil Service recruitment, except in a few critical areas.

In Ireland, the Government has cut public service salaries - including doctors, nurses and teachers - by up to 15%.

Spain has just announced a 5% pay cut in public sector pay and a wage freeze for 2011.

Italy has established a 3 year wage freeze for all public servants and will not replace one in five staff who leave. 

Progressive pay cuts of up to 10% are planned for high earners in the public sector.

And in Canada they've frozen wages in the public service for the next two to three years.

The New Europe is also facing financial pressure: The Romanian Government this week survived a confidence vote in Parliament over cutting public service salaries by 25% and pensions by 15%.

New Zealand is part of the same world, and the same international economy. 

We face the same challenges and uncertainty.  They are real and with us. Living within our means is not some right-wing is what every country is confronting.

As senior leaders you are well aware of the many challenges ahead for New Zealand - and for your agencies.

There are the financial challenges I've spoken about.

There are also service delivery challenges, and the challenge of increasing public expectations.

Your job is to lead - to show the way to your teams, to your colleagues, and your agencies.

Most of your departments will be confronting the reality that there will be no Budget increase in your agency's funding for the next 3-5 years. This is part of the public service's contribution to economic recovery and easing the tax burden.

You will be thinking about how your business has to change to live within those flat baselines.

You'll be focusing on productivity, and increasingly, contestability.

To match Australia, New Zealand needs to grow at an extra 2% a year for the foreseeable future. That will require significantly better productivity on this side of the Tasman.

Treasury research shows that most of the productivity gap between New Zealand and Australia lies in what's called the non-measured part of the economy[1].  That is largely the public sector. 

This means the imperative of improved productivity is greater for you. Even greater than it is for competitive firms in the private sector.

I am very conscious of the problems of measurement, and that the statistics often fail to reflect improvements in the quality of services. 

Never the less, the productivity gap with Australia is real indeed.  You are the people who can improve productivity in the public sector.  In fact, you by your example and leadership have greater powers than Ministers to change attitudes and culture, and get better results.

As you think about productivity and getting more for the taxpayers dollar, you will want to consider better ways of delivering your services. You will want to consider contestability...for example, can you provide a better service for your stakeholders for less cost using the private sector?

The Department of Corrections is using the contestability of private prison management to deliver better services and benchmark its own performance. It is the single biggest example of contestability in the public service.

The public health service has the private sector delivering breast screening, cervical screening, mobile surgical services and even more elective surgery.

The Government wants you to think outside the confines of current structures, with a focus on getting the maximum value for taxpayers dollars. You should consider what the private sector can do to help you and taxpayers.

Thank you for the work each of you is doing.

That work has already achieved significant positives. Later tonight the IPANZ public sector excellence awards will recognise those public servants who are achieving excellent things.

You can also be very proud of the most recent Kiwis Count results which show that Kiwis are generally happier with the standard of service they're receiving from frontline public services, compared to 2007.

In fact all the key factors that drive New Zealanders' satisfaction with the quality of service delivery have improved since 2007.

Results also show that two thirds of New Zealanders surveyed believe their last experience with a public service was ‘an example of good value for tax dollars spent.'

That's in comparison to just over half of New Zealanders surveyed believing so in 2007.

This lifts New Zealanders' satisfaction levels with frontline services on to a par with the best in the world.

Disraeli once said "Change is as inexorable as time, yet nothing meets with more resistance."

And you will encounter resistance as you try to make changes. But keep on pushing.

Thank you for the opportunity to open your conference and best wishes for the day.

[1] Non-measured sector includes service industries in which productivity is hard to measure (i.e. property services, government administration & defence, education, health & community services) and ownership of owner-occupied dwellings.  Taskforce 2025.