The spate of public service redundancies has come with a $80m price tag. File photo. Photo: RNZ / Quin Tauetau
Government agencies and ministries have had to fork out at least $80 million in redundancy payments to public servants since the coalition took office.
Ministries and agencies have also carried out 161 change processes or restructures.
Opposition parties say it shows the scale of the government's cuts, but the Finance Minister says the $80m is in the context of $1.5b of savings.
After taking office, the government asked ministries and agencies to find cost savings of 6.5 or 7.5 percent.
80-million dollars paid out to redundant public servants
On 17 September, Labour's public service spokesperson Dr Ayesha Verrall asked every minister for the total sum of redundancy payments made to staff at ministries, departments, and agencies they were responsible for, since 27 November (the day the government was sworn in).
Labour has tallied up the costs, totalling $80,313,276 so far, with a further $21,500,961 projected to be paid out.
The Ministry of Social Development reported the highest total, with $14,839,174 paid out.
Oranga Tamariki followed on $8,580,000, then StatsNZ on $7,930,881.
Photo: RNZ / Samuel Rillstone
The Ministry for Primary Industries, the Ministry of Education, Customs, the Ministry for the Environment, and the Ministry of Health also paid out multi-million dollar sums.
Verrall said it was not the money that was important, but what the payouts represented.
"Behind each of those dollars is a person who's lost their job and having to make a new start," she said.
"Clearly, there are going to be public services that we used to expect that we can no longer get under this government, or can't be delivered in the same way, because of the roles that have been lost."
Not every cut will have been for savings requirements. For example, some are for disestablished projects. Some entities not required to make savings have made cuts anyway.
The Ministry of Business, Innovation, and Employment, one of the largest public service departments, was not on the list collated by Labour.
In her answer to the Written Parliamentary Question, Economic Development minister Melissa Lee said the organisational changes or review and any associated impact on staff at MBIE had not been determined or forecast for all of 2024/25.
Finance Minister and Minister for the Public Service Nicola Willis, said ministries and agencies were paying out redundancies within smaller budgets.
"That's in the context of the public service delivering multiples more in saving. So more than $1.5b a year in savings, that completely overshadows that redundancy number," she said.
Willis said for workers who had their jobs come to an end it was appropriate that employment law was enforced and their rights and entitlements were upheld.
The Green Party also asked ministers how many restructures, change processes, or proposals that led to reshuffling or laying off employees took place at ministries they were responsible for since the government came to power.
In total, the Greens' public service spokesperson Francisco Hernandez said 161 instances were reported.
"Obviously, that creates a level of uncertainty for staff. It hurts the staff and it hurts the communities we're meant to serve," he said.
Nearly every ministry and agency had undertaken at least one change process, with MBIE completing 22 as well as two rounds of voluntary redundancies.
Kāinga Ora had completed 21 change processes which resulted in changes to responsibilities and/or disestablishing roles.
The level of detail in the answers to Hernandez's questions varies.
For example, Customs Minister Casey Costello said she was advised Customs had "initiated six organisational change processes," while Police Minister Mark Mitchell said two consultation processes were undertaken at Police, with only one including the disestablishing of roles and the other about aligning responsibilities.
While not every change process resulted in redundancies, Hernandez was still alarmed at the scale in such a short space of time.
"These restructures are because the government has cut the public service. So in some sense, this is the natural collateral damage or carnage the government's public sector cutting is causing," he said.
Based on statements from ministries and the Public Service Association, there have been 7241 public sector cuts to date.
PSA assistant secretary Fleur Fitzsimons said the whole exercise was a waste of money.
"The scale and nature of change has been chaotic, the results will be dangerous, and we will feel them for many years to come," she said.
She said the value of the redundancy payouts did not come close to compensating people.
"In many cases, payments are quite low, and actually provide little comfort to workers who are staring down job losses in this environment, and who had so much more to give our public sector."
And with the Crown accounts sinking further into the red, the government has said the savings exercise is far from over.
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