Managing the performance of our departmental assets - Annual Report 2019 - 2020
Our client services are supported by many assets that assist us and our shared service partners to deliver services like visiting clients, communicating, facilitating face-to-face discussion, and meeting together online.
Maintaining the fitness for purpose and availability of assets through strong asset management practice and performance monitoring is essential to optimising the value of our significant asset portfolio. This includes asset management planning at strategic and operational levels and a structured approach to assessing the condition and performance of our assets with a strong base of reliable asset information.
We manage more than $333 million in departmental capital assets, made up of $158 million of property, plant and equipment and $174 million of intangible assets. This year we received a capital injection of $11 million, which included funding to improve the resilience of critical systems. We spent almost $90 million on capital expenditure to maintain and upgrade our asset base. Strong capital asset management is crucial to our long-term success.
Our asset performance framework groups monitoring and reporting into Property and Technology asset portfolios. This breakdown, as further described below, reflects the different management approaches required to manage and monitor our significant assets.
Asset performance measures and standards are approved at executive level at the start of each financial year. Our asset performance results and standards are set out in Appendix 4.
Asset portfolios
Property
These assets provide more than 225,000m²of commercial office space (the majority of which is located within leased rather than owned premises) to house MSD and Oranga Tamariki staff. These property assets are key to enabling us to facilitate face-to-face engagement with clients and the back-office support necessary for a large government agency. The assets within the leased space are primarily fitouts, furniture and security assets. We relocated four client-facing offices into new improved premises this year.
In future years, the Oranga Tamariki commercial office space will largely move under Oranga Tamariki’s management and will be removed from MSD reporting.
We are introducing flexible workspaces in our National Office campus to better reflect the way our people work and to make better use of the space that we have.
We are also working on improving long-term property investment planning, including options to leverage tenure at strategic sites.
We are actively working with the Government Property Group to optimise government office accommodation throughout New Zealand.
Technology
We monitor asset performance within two broad categories: software and computer equipment. These play a critical role in ensuring that we can provide services in a timely, reliable and efficient way and in accordance with current government policy and legislation. The services provided through these assets are significant, with over 380 different technology services across a range of applications.
Most of our core applications are now at least 15 years old, with the core payments engine (SWIFTT) nearly 30 years old. The age of these systems means it is increasingly difficult to maintain and support these applications or to deliver policy changes in a timely manner. Some of our software assets are no longer fully supported by the supplier and will need to be enhanced or replaced.
We received funding in 2019 to reduce the risk of critical systems (such as client-facing systems) failing, and in 2020 initial funding was received to begin work on our financial management information and payroll systems and to begin modernising our income support system.
