NZ DMO chief Combes takes top job at Local Government Funding Agency

Friday, 11 November 2011| BusinessDesk Article

Philip Combes, the treasurer of the New Zealand Debt Management Office, has been tapped as head of the new local authority borrowing agency, which is to be the nation’s second-largest debt issuer after the government.

Combes is moving to become the chief executive of the Local Government Funding Agency, which will manage debt for councils and other local authorities in a centralised way.

He is not putting a figure on the size of the portfolio he expects to oversee. "It remains to be seen," he said. "It is likely to be the second biggest borrower behind the Crown."

Combes said he was taking up the role because it was a unique challenge to set up a new agency from scratch. He likened the authority to semi-government issuers in Australia.

Combes previously worked for Tasmanian semi-government issuer Tascorp. He takes up the Wellington-based role early in the new year.

The LGFA has been set up to consolidate a local government issuer market where 80 participants issue small amounts of debt.

The Treasury estimates that the fragmentation costs $25 million a year in extra interest costs and that local government borrowing could rise from $6 billion to $10 billion in the next five years.

It is hoped that the authority will strengthen New Zealand's capital markets.