WELLINGTON - New Zealand’s Ministry of Education announced on April 17 it planned to cut about 12 per cent of its workforce as widespread layoffs are announced in the public sector in an effort to reduce spending and curtail debt.
The conservative coalition government, elected in October, has asked ministries and departments such as health, conservation and business to make savings of between 6.5 per cent and 7.5 per cent as it attempts to reduce spending on public services by around NZ$1.5 billion (S$1.2 billion).
At the same time, government-owned entities such as research institute Callaghan Innovation are cutting staff numbers to offset falling revenue.
Education chief executive Iona Holsted said in an e-mail to staff on April 17 that to meet the savings required by the government, it proposed cutting 565 full-time equivalent jobs at the Ministry of Education. She said 225 are currently vacant.
“We will need to reduce our work in some areas and remove as much duplication as we can across our functions,” Ms Holsted said.
More than 2,000 public service or government entity roles have been earmarked to go and further proposed layoffs are expected.
Under New Zealand law, a proposed restructure or redundancies must be consulted on before a final decision can be announced.
The government says that the public sector, which has grown by nearly 20 per cent since the start of the COVID-19 pandemic, is inefficient but has promised frontline staff such as police and teachers will not be impacted.
Supporters of the public service argue a larger public service is needed to meet the demands of a growing population and previous under-spending.
The government's request to reduce operating costs is part of wider cuts being made as the government struggles with falling tax revenue, increased debt and fulfilling costly elections promises including reducing personal income tax.
New Zealand’s Finance Minister Nicola Willis in March said that it was very unlikely that government accounts would move into surplus by 2026-27 and even reaching a surplus the following year is not a given. REUTERS
