‘Contempt for taxpayers’ - Treasury pauses project reporting for nearly three years

Treasury has only recently resumed reporting on "significant" projects. Photo / Mark Mitchell

Tens of billions of dollars of Government spending escaped Treasury scrutiny during the pandemic response, despite an order from the Government that Treasury must provide updates on “significant” projects.

The Government spends more than $100 billion every year, roughly one in every three dollars in the economy.

In October 2019, the Government decided to require Treasury to regularly provide updates on “significant” projects - those worth over $15 million - to ensure the project was being delivered properly, on time and on budget.

But none of these reports were actually completed until August 2022. There have been two more since. The Government has refused to release the reports under the Official Information Act, saying they will be “proactively” released following next month’s Budget.

National’s Infrastructure spokesman Chris Bishop said the lack of reporting showed “real contempt for taxpayers”.

“That’s completely unacceptable - this government has a history of spraying large amounts of money around, but unfortunately they have a very poor history of accountability for that spending,” Bishop said.

The period covered includes multiple “significant” spending decisions, inducing the establishment of the $12 billion NZ Upgrade transport programme in 2020, that programme going over budget and needing to be pared back and baled out to the tune of $1.9b in 2021.

iit also covers the period in which the new Auckland Light Rail body was established, as well as the merger of polytechs and DHBs into new single entities.

Bishop said the reports on these sorts of projects “would have been extremely useful to find out if taxpayers are actually getting value for money for the big amounts of money that they’re investing”.

“We should have had independent reports from Treasury about the quality of the spending about the benefits that may have may or may not have been realised as a result of that spending,” he said.

A spokesperson for Treasury said the reason for the nearly three-year gap between the reports being requested and the first being delivered was largely thanks to “resourcing constraints and the impacts of the Covid-19 pandemic”.

The spokesperson said that in this period “individual agencies have continued to report to ministers on the investments for which they are responsible”.

Grant Avery, a consultant who specialises in project management in large and high risk projects told the Herald that these reports would have helped these projects be delivered better.

“Accountability and transparency are core tenets of an effective investment management system. Independent reports on the performance of those projects, all high risk projects, would tell us how the projects did against their budgets, their schedules, and the benefits they promised in their business cases.

“These types of projects are known to be poor performers globally. This is why this type of reporting is directed to happen by a Cabinet circular, but it hasn’t been happening. If Cabinet had the reports they would learn critical lessons for future projects, and have a tool for driving better project performance through transparency of accountabilities,” Avery said.

The quarterly reporting now being done by Treasury is intended to help ministers see the “pipeline” of projects across government, and to help make better decisions earlier in a project’s lifetime, rather than waiting until it is too late.

They also provide analysis on how different projects should be prioritised and sequenced.

This may be the reason for the reports being withheld until the Budget, when it is widely expected the Government will resequence some of its more difficult projects so that resources can be better directed towards areas like the recovery from Cyclone Gabrielle.

The previous Government commissioned regular reporting into high value projects although it stopped this in 2017, before leaving office.