$87.3b investment to focus on transformational projects

The New Zealand government has focused its $87.3 billion investment programme into projects that will fundamentally change the way it operates in the ongoing drive to get more with less from the public service, according to a Treasury report.

The Treasury's second annual report on investment projects show the Crown's investment portfolio - including planned work, work in progress, and completed work - rose 15 percent to $87.3 billion in the year ended June 30, 2016, spanning 508 different projects, up 24 percent from 2015. Of that, $39.3 billion was for 192 projects which aim to "transform and fundamentally change the way services are delivered" and often involve "significant business change".

Some $31.5 billion was spent on 230 projects to keep existing services running, while a further $16.4 billion on 79 projects was tagged for enhancing existing services.

The Treasury cited Immigration New Zealand's $119 million programme in 2015 to overhaul a largely-paper-based system to one that was "more flexible, risk-based, customer-focused, consistent and cost-effective", transforming visa processing to cope with increased demand.

Much of that spending is tied up in what the government deems to be complex projects, and the Treasury's major project watchlist released yesterday had 53 projects with a price tag of $37 billion attached as at Nov. 1. Of those projects, 33 were to do with transformational change.

The annual investment project report shows $41.9 billion was spent on 281 projects in the year. Much of that was in Auckland, where $16.8 billion was spent on 74 programmes, although the Western Ring Route road accounted for $2 billion alone in what is the New Zealand Transport Agency's biggest ever project.

By sector, transport was the biggest beneficiary with $21 billion of spending tagged for 68 projects, followed by $16.2 billion for 58 defence projects. Housing was third with $12.6 billion earmarked for nine projects, and $10.3 billion for 151 different health programmes.

(BusinessDesk)