Reaching a surplus was a significant milestone and one the public service could be proud of, but the job was far from done, Finance Minister Bill English said yesterday.
On Wednesday, the Treasury released the annual Crown accounts, which showed a surplus of $414 million for the year ended June.
In a speech, Mr English said while Wednesday was an appropriate time to take stock of how the accounts had moved from an $18 billion deficit to a surplus in four years, it was time to get back to work on making continued improvement into the future.
Fluctuations in revenue remained largely outside the Government's control, he said.
''So we are going to continue with our focus on responsible and prudent management of expenditure. As we've demonstrated in our path back to surplus, this isn't about slashing spending or services.
"It is about understanding and addressing the underlying drivers of demand for social services so we can support people to lead better lives and save taxpayers' money in the long run.''
It was also about managing the balance sheet.
Good asset management now meant less debt, Mr English said.
Many governments around the world did not understand what they owned.
Seven years ago, the Government did not understand basic things like the condition of the property it owned.
Nor was there tough testing of the $6 billion annual capital spend.
The latest example was social housing, he said.
''Politics has locked us into the demographics of the 1960s. It is a $21 billion asset, a third of which is the wrong size or the wrong location, and it needs substantial upgrading.''
The Government had embarked on a large-scale reform programme. It turned out owning houses was not such a specialised activity, Mr English said.
About 95% of houses were owned by ''quite normal'' people who managed their assets well - often better than the State.
The Government had a clear responsibility to the most vulnerable but it did not need to own the houses in order to give effect to that responsibility, he said.
The Government wanted to have the best-managed public balance sheet in the world.
It had increased the hurdles and rigour for new capital investment and was increasingly shifting its focus to the management of existing assets.
The Government share offer programme brought private sector discipline to public assets while providing funding for public investment.
For the 51% share last year, the Government received $139 million more in dividends from the three energy companies - Meridian, Mighty River Power and Genesis - than in the final year of full Crown ownership.
''We are working to get much better information about our existing assets and their performance, sharpening our monitoring of significant projects and requiring investment-intensive agencies to develop long-term investment plans of at least 10 years,'' Mr English said.
