Source: New Zealand Government
Spending on contractors and consultants continues to fall and the size of the Public Service workforce has started to decrease after years of growth, according to the latest data released today by the Public Service Commission.
Workforce data for the quarter from 31 December 23 to 31 March 24 shows a decrease of 0.6 per cent (or 416 FTEs) indicating workforce size peaked in December.
“We knew that the recent increase in the number of back-office public service roles was unaffordable and needed to be reined in,” Public Service Minister Nicola Willis says.
The full impact of Budget 2024 decisions is yet to be realised which is why the nine months to 31 March 2024 still shows a small net increase of 3.4 per cent in FTE since June 2023 to 65,283 FTEs.
“I expect to see the impact of the Budget start to flow through in the coming months and continue into the next financial year with further decreases,” Nicola Willis says.
“Our ongoing savings and efficiency drive will continue to put downward pressure on the size of the workforce, which is likely to see a further reduction in FTEs.
“These are tough decisions and I feel for anyone losing their job, but the Government simply had to reduce public spending because it was living beyond its means.”
The data also shows for the year to 31 March, contractor and consultant expenditure is the lowest share of total workforce spend that it has been since Public Service Commission records began in 2018 – down from 13.1 per cent in 2022/23 to 8.5 per cent.
Spending totalled $700.5 million in the nine months to March 2024 – $249.8 million capital expenditure, and $450.7 million operating expenditure which is down 34 per cent on an annualised basis.
“I am anticipating a further decrease in the annual spend by the end of this financial year. The Government’s expectation is for this decrease to continue.”
