The Controller function

The Controller function is described more formally in our publication, About the Controller and Auditor-General. Here, we have simplified that further to explain what the Controller function is.

Although New Zealand has an elected Government in power, the Government alone doesn't decide what New Zealanders' taxes will be spent on. The whole of Parliament is involved (all of the elected representatives) in decisions about how much money will go to different areas of spending (such as spending on health, or education, or conservation, or defence).

The approved decisions about what the Government can spend money on are recorded in what are known as “appropriations”. Those appropriations become law, so spending that doesn't fit within an appropriation (because too much was spent or money was spent on activities that the appropriation didn't cover) is unlawful.

The checks that take place

During annual audits of government departments, auditors check that spending is in keeping with the amounts and the types of activity set out in the appropriations. If it doesn't look right, auditors raise that with us (the Office of the Auditor-General) and with those in charge of the department that has made mistakes in its spending.

The fix that needs to be applied depends on whether the spending was too high or on the wrong sort of activity. Fixing these sorts of errors can be complicated but the fix must be done correctly because these are matters of law.  

As well as these checks during the audits, the Treasury sends us monthly reports to review. We get highly detailed spreadsheets of the spending done by government departments, and we check them. 

The Controller's powers

If the Controller is not satisfied with the steps that a government department is taking to fix an appropriation error, he can stop the government department from receiving money.

The Controller can also direct a Minister to report to Parliament about the wrongful spending.

This power is a very important part of New Zealand's system of democracy. It means that someone is watching the spending that happens and can "turn off the money tap" if that spending isn't lawful.