10 Apr 2009

Govt to work with SOEs on financial targets

8:30 am on 10 April 2009

The Government and Crown companies are to work their way through individual performance targets.

The Government is undertaking value-for-money exercises throughout the economy and state-owned enterprises (SOEs) make up 20% of the Crown's balance sheets.

State-Owned Enterprises Minister Simon Power and Finance Minister Bill English met with the chairs of SOEs on Thursday to discuss the Government's concerns about declining financial performances.

Mr Power says the meeting did not focus on specifics, but gave the Government a chance to talk about the role of SOEs in the economy under current economic conditions.

Mr Power says the Government will work with SOEs toward their financial targets, as taxpayers expect it to hold the stewards of $24 billion of public investment to account.

But job losses and price rises should not be the first port of call for SOEs trying to save money, he says.

Finance Minister Bill English called on state-owned enterprises to do a better job.

Mr English says SOEs had a number of good years under the previous Labour government, which did not put much pressure on them.

However, he says there is now a recession and a new Government which wants better value for the taxpayer dollar.

Mr English says SOEs need to get better returns - but not by simply putting prices up.

New Zealand Post chair Jim Bolger, who also chairs Kiwibank and KiwiRail, says the Government has given state-owned enterprises the right message at the right time.

He says they can always do something to save money, which is a matter of focus and priorities.