Nicola Willis: Finance Minister on the savings from the public sector job cuts

Published Mar 27, 2025, 7:24 PM

The Finance Minister says they've over-delivered on their promise to save money from public sector job cuts. 

Latest Public Service Commission data shows the core workforce decreased 4% in the year to December 2024. 

Public Service Minister Judith Collins says the Government's expecting to save $800 million by June – double the initial target. 

Nicola Willis —the coalition government's initial Public Service Minister— told Mike Hosking the money saved is going into much better purposes. 

She says it’s instead going into things like the Family Boost Policy, to support early childhood education costs. 

LISTEN ABOVE 

Some very good news from the government on the crackdown on consultancy spending though, so they're looking to save eight hundred million dollars over a couple of years, being they've done at four hundred million dollars a year. Numbers out yesterday, they've been successful. Finance Minister Nikola Willis, good morning, Good morning rain. I watched Youth Collins in the house yesterday. She's seemed proud as punch with these numbers, as indeed she should be, shouldn't she.

Indeed, we've over delivered and this is an area where there's no doubt money was being wasted, taxpayers money and that money is now going to much better purposes, including into the back pockets of Kiwi's dealing with a pretty high cost of living.

How are you doing How are you doing that? So is this four hundred million eight hundred eventually is that going to be spent or is it going to be to retire debt or what?

Well, this was part of our plan at the last budget to help fund tax relief without having to borrow for that tax relief. So by delivering these savings, we've been able to, for example, deliver the Family Boost policy which is giving family support with their early childhood education costs. By reducing waste for spending in one pace of place of government, we've been able to make sure that kiwis can hang on to a bit more of what they earn. Good result.

What literally was the money spent on? Because it's easy to lose jobs and it's easy to cut spending, But the counter argument from the unions and such is that stuff isn't being done anymore. What was eight hundred million dollars being spent on?

Well, in my opinion, a lot of it was being spent on reports by very expensive firms that then set on shelves and gathered a little bit of dust. I think we had developed a culture in the public service where if you wanted to get someone to say that your idea was a good idea, send it to a consultant put the stamp on. If you wanted to get someone to give you some graphs and some numbers, send it to a consultant, get them to do a PowerPoint set of slides for the minister. And it had become so endemic that the money being spent had just sowed up quite dramatically to more than a billion dollars, and the minute that we came in and said, ah, not happening anymore, those numbers drove down quickly. I still catch public servants every now and then sort of out of the old habit saying, oh, we'll get a consultants report, But ultimately public servants are capable. They can do this stuff themselves, and that costs the taxpayer a lot less.

Judith Colin says, there's more weathers came from. How much more do you reckon?

Well? I think that the public service itself is going to get a lot better at using digital tools and new technology to deliver a lot of the work it does, and then over time that's going to free out more money in their budgets for the frontline services that we're wanting them to focus on. But with the consultants, we haven't set a target beyond where we are now. That's something I'm thinking about because I've found the targets that we put in place in our first year were really useful in driving these numbers down. So I'm sure that that's something that Judith will look at.

Now, is some you're making the supermarket's announcement or Saturday Sunday Okay, Sunday, because I've got the warriors Sunday. Is this worth it or not?

Well, what I'm announcing, Mike, is the next steps that the government is taking to push grocery competition along. We want Kiwis to get fear of prices at the checkout. We're convinced by the case that says it's not a very competitive market here. In fact, it's one of the least competitive in the world. And when you don't have good competition, consumers don't get the best steel. So you're a call. A month ago, I said, look, I want someone else to come to this market. Let's look at what the regulatory burdens are. I've now gone back to Cabnet and on Sunday, I'm going to announce where we've got to.

He So those are specific, So you're not toying with me here. These are specifics. Something tangible will happen out of your announcement Sunday.

Well, I'll announce where we've got to. So what I've gained from going out to the market and saying what are you interested in? And then I am going to announce where we're going next. There's two things I need to achieve here. Mike one is sure pace patient, sorry not patients in this coast. There'sh offers have been waiting for a long time for progress on this one. On the other hand, when you're dealing with a two and a half billion dollar market, you don't want to move so fast that you're not moving with care and consideration. So I'm going to announce what the next steps are, what progress we've made, and what progress New Zealanders can expect over the next six months.

I hope it's good, Appreciate it. Nikola Willis win and it's minister for more from the Mic Asking Breakfast.

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