IRD staff told of plan to shed 2000 jobs

"This plan could negatively affect our country's ability to pursue tax avoidance and compliance." Erin Polaczuk, PSA national secretary

The Inland Revenue Department plans to cut almost 2000 jobs, and has briefed staff on changes to hundreds of roles that will kick in next year.

The tax department currently employs 5647 staff, but expects to employ only 3700 people by 2021, department documents supplied to a select committee show.

The Public Service union (PSA) said in a statement that as many 4000 Inland Revenue employees would see their jobs change as a result of a final proposal that was put to staff across the country yesterday.

‘‘Make no mistake – this proposal contains future commitments to reduce IRD’S workforce by 30 per cent by 2021, and this is the first step in accomplishing that,’’ PSA national secretary Erin Polaczuk said.

Inland Revenue closed its doors yesterday afternoon to brief staff on its plans. Commissioner Naomi Ferguson said its 3300 customer-facing staff were all being offered or confirmed in new roles at the department.

But about 900 other staff would see their jobs change, with a reduction in management and more roles for specialists.

The tax department signalled last year that it expected to cut about 1500 jobs between 2018 and 2021. The new figures supplied to Parliament’s finance and expenditure select committee indicate the cuts will go even deeper and will start on a small scale next year, before kicking in strongly in 2019.

Polaczuk said the final proposal put to staff yesterday contained ‘‘a lot of vague, corporate rhetoric’’ and showed the department had ‘‘not taken the concerns of over 3000 PSA members into account’’.

‘‘The loss of expert staff and the lack of certainty for workers reapplying for more simplistically modified roles means that important regulatory changes to the tax system rest on very shaky foundations,’’ she said.

‘‘This could affect up to 4000 staff in varying ways at this stage of the restructure, and this has not been fully explained.’’

Polaczuk said the PSA was also concerned Inland Revenue was proposing to expand some job duties while cutting entry-level pay for some positions, such as customer service operators.

‘‘Whether you call it ‘streamlining’ or ‘cost-cutting’, this plan could negatively affect our country’s ability to pursue tax avoidance and compliance, as well as making life much more difficult for ordinary people seeking tax advice from IRD call centres.’’

The changes Inland Revenue is making stem from its $1.9 billion Business Transformation (BT) programme, which will see the department replace its aging computer systems and ensure individuals and businesses are taxed more accurately through the year, reducing the need for additional tax payments and annual tax refunds.

A shakeup of child support payments proposed last week as part of the BT programme would see them all automatically deducted from parents’ wages, with child support and Working for Families benefits potentially adjusted more frequently through the year to better match people’s obligations and entitlements.

Parliament’s finance and expenditure select committee said in February that the Treasury had suggested it was ‘‘optimistic’’ to expect the total cost of the BT programme to come in at $1.9b.

‘‘The Treasury said that, if the anticipated savings of about $740 million are not realised, the Government will need to provide significantly more funding for the programme,’’ the committee said.