Following the collapse of the banking system in October 2008, Iceland has faced numerous challenges. Major changes are being made to some of the foundations of the society, for instance the banking sector, but questions have been raised on further basic changes in government and ministries, e.g. merging of ministries and official institutions, in order to increase efficiency, reduce cost and increase the capability of the government to deal with the present and future emerging situations. But given the new impetus on increasing efficiency, what is the status of project management maturity within the ministries? In order to foster effective improvement, there is a need to gain an understanding of the current state and capabilities. The project management maturity of Icelandic ministries was assessed in a simple way by looking at five of the twelve ministries in detail. The average maturity score of all the studied ministries is only 1,3 out of five. There would therefore seem to be a potential for considerable improvement in project efficiency and project results within the ministries. The paper argues that rather than cutting projects, the current focus needs to shift to creating and establishing capabilities that will underpin and sustain future improvement. Project management is central to economic recovery and developing the right balance of capabilities will deliver improvement in the long run and play a key part in delivering a new and improved future. In doing so it will also rehabilitate the profession and its reputation