18 Oct 2013

Govt seeks private sector ideas on public asset management

8:59 am on 18 October 2013

The Government is inviting the private sector to come up with ways to improve the management of public assets and liabilities.

Speaking at the Institute of Finance Professionals annual conference in Auckland, Finance Minister Bill English said the Government did not plan to sell any more state-owned assets once all its power companies were listed on the stock market.

But he said the private sector was better at running businesses than the Government, and it was keen to introduce more private sector thinking and discipline into other parts of its portfolio.

Mr English said elderly care was a good example of where the private model had worked well, and he was keen to apply it to social housing, which is one sector the Government wants to overhaul.

He said it will go from a regulated monopoly to a market and the Government wants to seed fund participants and get other big balance sheets behind it.

Mr English said there was $2 billion of sovereign cash flow in that market.

He said aged care, for example, has one of the more successful listed companies, Ryman, as a participant and although the Government does not own a single aged care bed it subsidises the care of most older people who need it in New Zealand.

Mr English said government-funded organisations such as local councils, universities and hospitals were often not well managed.

And he hoped the private sector might be also be able to help and see opportunities that work in the private sector and may be able to apply to the public sector.

Mr English said an active market in New Zealand could help the Government with its asset and liability management.

He said the Government was also keen on using the Public Private Partnership model, or PPP, as a way of improving the running of public assets.