Hon Nicola Willis
Minister for the Public Service

New data shows the public service is on track to save more than double the Government’s initial target on contractors and consultants.

Minister for the Public Service Nicola Willis says it shows “the consultant gravy train is well and truly over”.

“Taxpayers are not a cash cow for consultants and contractors to line their pockets. I’m delighted at the savings - it shows where there is a will, there is a way when it comes to respecting taxpayers.”

The data comes from the Public Service Workforce Data – September Quarterly Update, which the Public Service Commission released today.

The Government set the public service a target of eliminating $400 million in operating expenditure on contractors and consultants by 2024/25.

In 2023/24 savings of $274 million were achieved. This year the public service is on track, after the first quarter, to achieve savings of about $500 million. These savings are forecast to continue over the next three quarters, which means savings over the two-year period could total more than $800 million, according to the update.

It shows operational expenditure by departments on contractors and consultants fell a further 46 per cent in the September quarter on an annualised basis, after a 31 per cent drop in the previous financial year to June.

“The public service has heard the message loud and clear – the Government wants the public service to reduce the spend on contractors and consultants, and use and develop its internal expertise more,” Nicola Willis says.

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“There is a lot of talent within the public service and I’m delighted to see the cultural switch from farming work out, to finding solutions within agencies. It respects the internal capability and skills of our hard-working public servants.”

The Public Service Commission’s September Quarterly Workforce Data Update also shows the size of the public service has decreased 2.2 per cent from September 2023 to September 2024, and 1.1 per cent for the quarter.

In real terms, this is an annual drop of 1,402 full-time equivalents (FTEs).

"I feel for anyone who loses a job, but no government can live beyond its means indefinitely,” Nicola Willis says.

“The growth in the public service under the previous government was not sustainable if we also want to fund the health, education, welfare and other services New Zealanders depend on.

“We are moving the emphasis of the public service from the back office to the frontline.

“Our workforce data is already showing this is happening.

“In the year to June there was an 11 per cent reduction in the number of clerical and administrative roles, and an eight per cent reduction in policy roles.

“At the same time, the number of service delivery roles increased. Contact centre workers increased 17 per cent. Inspectors and regulatory officers increased six per cent, and social, health and education workers have gone up 1.5 per cent.

“We are making progress.”

Notes:

The Public Service Workforce Data – September Quarterly Update will be published on the Public Service Commission website shortly.

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