New Zealand’s government plans to cut 14% of public sector jobs to slash spending
WELLINGTON, New Zealand (AP) — of New Zealand The government will cut nearly 9,000 jobs, accounting for 14% of public sector jobs, as part of a bid to cut billions of dollars in spending by mid-2029, Finance Minister Nicola Willis said on Tuesday.
Willis said his administration would also impose a third consecutive year of budget cuts for most public agencies, “significantly reduce” the number of departments and call for faster hiring. artificial intelligence technology industry wide. The cuts would save NZ$2.4 billion ($1.4 billion) in that period, the minister told a business audience in Auckland, New Zealand’s largest city.
Many public servants live and work in the capital, Wellington. Willis said their numbers would drop by 8,700 to 55,000 on December 2025 figures.
This would drop from 1.2 per cent to 1 per cent of New Zealand’s population of 5.3 million, he added.
“This is unsustainable, unaffordable and contrary to international trends,” he said on Tuesday. The military, teachers and doctors will be among those exempt from job losses, Willis said.
The measures will also reduce the number of government departments and agencies from the current 39 to an unspecified number.
But the layoffs won’t happen immediately, and Willis hasn’t revealed details of a plan to decide who will lose their job. The centre-right government, which has been in power since 2023 and campaigned at the time to downsize the public sector. We are facing a new choice In November.
Unions and opposition political parties condemned Tuesday’s announcement.
Labor and opposition leader Chris Hipkins said: “There is no way we can reduce so many people working in our public service without reducing front-line services.” Duane Leo, a spokesman for the union that represents thousands of public servants, said the measures were “a deliberate act of destruction.”
The National Party-led government alleges fiscal recklessness by the previous centre-left Labour-led administration is responsible for the increase in the number of civil servants, which rose from 48,000 to 63,000 during Labor’s time in office. Labor in 2018 removed the cap on public sector jobs imposed by the last National government, saying it had led to increased spending by agencies avoiding new full-time hires for contractors and consultants.
Funding for most government agencies will be reduced by 2% in the government budget at the end of May, Willis said. If the government is re-elected, there will be cuts of 5% per year in each of the next two years.
Willis said the public sector had “not kept up” with advances in artificial intelligence and digital technology and would need to embrace them.
The promise of public sector cuts was brought to the attention of the Prime Minister as growth in the New Zealand economy remained slow. Christopher LuxonSelling himself as a better financial manager than his rivals, Trump is trying to show evidence of an economic recovery before the November vote. The prospect of a more efficient public sector is “exciting”, Luxon said on Tuesday.
“Public service is not a temporary function,” he said.
