Treasury boss vows to look beyond 'beige mindset'

Gabriel Makhlouf. Photo / APN

Treasury boss Gabriel Makhlouf says his department needs to look beyond the dry economic orthodoxy it has become known for and seek fresh ideas as it works to improve New Zealanders' living standards.

Mr Makhlouf, who has been in the job since June last year, said the world had changed since the global financial crisis and was in the midst of a prolonged period of instability and risk and Treasury had to adjust.

Mr Makhlouf said Treasury's challenges were to help New Zealand seize opportunities in the Asia Pacific region while dealing with imbalances in the local economy, improving productivity and competitiveness, rebuilding the Crown's balance sheet, recovering from the shock of the Canterbury earthquakes and supporting the public service to deliver increasing value to New Zealanders.

The organisation could not do that by relying on its traditional strengths of "crunching numbers, stretching dollars, and pinching pennies".

"It's imperative that we take a hard look across the board at the way we do things, and we are doing just that."

Treasury was not "a bunch of white men in grey suits with a beige mindset" but was making progress with its diversity strategy that Mr Makhlouf said would help drive change at the department.

"I want us to be more open to new ideas and to ask ourselves, not least in the face of post global financial crisis realities, whether we have the models and frameworks we need.

"We have to understand different perspectives, constantly look for new insights and recalibrate our views in light of new evidence."

However, Treasury would not break with economic orthodoxy altogether. It was "a fundamental truth that successful economies need, among other things, a stable and sustainable macroeconomic framework, sound monetary policy that delivers stable and predictable prices, a prudent fiscal policy and debt that's under control."