New Zealand set for public service headcount reductions as National Party moves to form government
The opposition National Party is to form the next government in New Zealand after the party won enough seats to form a coalition to remove the incumbent Labour party from power.
According to voting tallies reported by the New Zealand Herald, preliminary results suggest National will win 50 seats, up 17 from the last election. By contrast, the Labour party is projected to win 34 seats, a loss of 31.
When combined with the 11 projected seats of the ACT party, a natural ally on the right, the National Party will have a slim majority in the 120-seat parliament, and incumbent prime minister Chris Hipkins has phoned National’s leader Chris Luxon to concede defeat.
Luxon said his government “will deliver for every New Zealander”, adding: “We will bring down the cost of living. We will restore law and order.
“We will deliver better health care and we will educate our children so that they can grow up to live the lives they dream of.”
Read more: Turmoil ahead: will the pendulum swing again to change New Zealand’s public sector?
National government aims to cut government spending and public service headcount
Luxon’s government is set to try to trim government spending in the years ahead.
The National’s ‘Back Pocket Boost’ policy agenda said a savings drive would start immediately when they took office. This would aim to make “an average of 6.5%” of savings of 2023-24 forecasted departmental expenditure.
Among the measures proposed to make the reduction are leaving some public service job vacancies unfilled and stopping some new hires in departments. The National said it would only aim to reduce public service headcount “in non-essential back-office roles such as communications and policy” as part of plans to save an average NZ$594m (US$354m) per year across back office functions. It has also proposed reductions in government spending on contractors to the tune of an average NZ$400m (US$238m) per year.
Under a National-led government, departmental-specific caps on spending on contractors would be introduced in 2024 with a quarterly reporting of expenditure. Restrictions will also be introduced on the use of contractors where there are full-time employees doing the same work.
Read more: New Zealand election battle lines drawn over public services
About Richard Johnstone
Richard Johnstone is the executive editor of Global Government Forum, where he helps to produce editorial analysis and insight for the title’s audience of public servants around the world. Before joining GGF, he spent nearly five years at UK-based title Civil Service World, latterly as acting editor, and has worked in public policy journalism throughout his career.
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