New guidance aims to improve asset management

New Zealand ranks near the bottom of developed countries for asset management, says Andy Hagan, the Infrastructure Commission’s general manager of investment. A new guidance framework aims to improve the nation’s performance.

“Leaky hospitals, mouldy classrooms, and deteriorating public buildings are the visible signs of a system that has struggled to plan and invest for the long term.”

He says asset management needs to be at the centre of business planning, but is too often a secondary consideration, and that, although they are responsible for nearly half of New Zealand’s infrastructure, many central government agencies still fall short.

“Every homeowner knows that if you don’t paint the weatherboards, eventually they rot. The same principle applies to schools, hospitals, roads and public buildings,” says Infrastructure Minister Chris Bishop, who says the guidance will help improve how government agencies maintain and manage the country’s infrastructure.

“The new Asset Management and Investment Planning guidance provides clearer expectations for agencies and sets out what good practice looks like.”

It establishes a framework for planning, delivering, operating, maintaining and renewing essential infrastructure assets, while setting expectations around investment planning, robust asset data, and improved visibility of asset performance across agencies.

Hagan says that if used, the guidance will allow decision-makers and the public to see how well agencies are managing their assets and whether they’re meeting long-term plans.

“But guidance only works if it’s used, and we’re challenging every agency to raise the bar,” Hagan says. “Managing our assets well is not an optional ‘nice to have’ – it’s a basic building block to ensure services can meet community needs at an efficient cost, now and into the future.”

He says our poor asset management record reflects a systemic issue, and that agencies need to be clear about what they own, why they own it, and how they plan to manage it. Most of the infrastructure we need for the next three decades already exists; it just needs to be looked after.

“Asset management maturity varies widely across the public sector and tends to be lowest in the big social infrastructure sectors like health, education and justice. We need to fix this,” Minister Bishop says.

“Too many agencies report non-compliance with Cabinet expectations, whether that’s depreciation funding, reliable asset registers, or up-to-date asset management plans.

“Common problems include limited understanding of asset management, competing priorities, poor information about asset condition, and a general acceptance of inadequate practice. This guidance makes clear the standard expected and gives agencies the tools to lift their performance.”

The new guidance is the first step in a long plan to improve New Zealand’s infrastructure.