Finance Minister’s public service hints

The Government will create more frontline roles than it’s losing through cuts to public service, Finance Minister Nicola Willis says.

She revealed the information after giving a scene-setting speech ahead of Budget 2024 yesterday, in which she dropped hints about the future funding of public services.

The Government had met its target of $1.5 billion of savings across government agencies, she said, but Willis also revealed she wanted to find out whether more jobs were being created than shed.

“We’re creating more frontline roles than we are disestablishing roles through the savings exercise.”

Willis signalled “significant” funding boosts for health and targeted new investment in education, disability services and police. All agencies, which were going back and forth with ministers over what their cost saving proposal would look like, “have been given a final answer as to what their savings need to look like, then they can plan with confidence about the future”.

Willis said there were a few agencies who have not met their cost saving target.

“One example, the New Zealand Police, they were able to convince us that reaching their target would involve potentially making changes that would undermine the frontline service provision.

“We just weren’t prepared to go through with that. But at the same time ... there are other agencies who went above and beyond the target. There are some unders, there are some overs. Altogether, it adds up that we will deliver the savings.”

Whaikaha – Ministry of Disabled People also did not make the saving target, but did find savings, she said, “because they identified they did have consultant and contractor spend, they did have the potential for back office efficiency”.

Political commentator and former parliamentary staffer for the National Party, David Farrar, said the upcoming Budget “is probably one of the more critical ones for a new government”.

“The path Nicola’s done, actually is one that I think is going to prove popular. But the proof is in the pudding, where people need to see a Budget that’s got a path back to surplus. No-one wants spending cuts if you still end up not getting back into surplus.”

Farrar said he thought the public had a mixed reaction to public service redundancies, “most people probably see it as necessary, but also have a great deal of sympathy for those who are affected”.

ACC, a Crown entity that was not set a savings target, proposed an almost 400 role cut – which included 81 vacant roles and a proposal to create 315 new roles.

An ACC employee, who did not want to be named, said “the scale, the timing, all at once” felt as though the hundreds of workers were being thrown under the bus.

They said people, many who had families and mortgages, were left feeling, “now I don’t know if I’ve got a job in two months”.

“How do you retrain in a work environment that we’ve got now in New Zealand for the next six months, which will be quite difficult.”

Public Service Association Assistant Secretary Fleur Fitzsimons called it “just more dumb stuff forced on ACC by the Government’s spending cuts”.