Huge savings on consultants

Nicola Willis announced:

The Government set the public service a target of eliminating $400 million in operating expenditure on contractors and consultants by 2024/25.

In 2023/24 savings of $274 million were achieved. This year the public service is on track, after the first quarter, to achieve savings of about $500 million. These savings are forecast to continue over the next three quarters, which means savings over the two-year period could total more than $800 million, according to the update.

It shows operational expenditure by departments on contractors and consultants fell a further 46 per cent in the September quarter on an annualised basis, after a 31 per cent drop in the previous financial year to June.

Great news, except for consultants.

The Public Service Commission’s September Quarterly Workforce Data Update also shows the size of the public service has decreased 2.2 per cent from September 2023 to September 2024, and 1.1 per cent for the quarter.

In real terms, this is an annual drop of 1,402 full-time equivalents (FTEs).

“I feel for anyone who loses a job, but no government can live beyond its means indefinitely,” Nicola Willis says.

“The growth in the public service under the previous government was not sustainable if we also want to fund the health, education, welfare and other services New Zealanders depend on.

So for all the wailing and gnashing, the actual drop over 12 months has only been 1,402 FTE staff. This is partially because in a fit of of irresponsibility there was a huge increase in the last quarter of 2023, despite the election.

Here’s the change by quarter:

• Jul – Sep 23: +1,106
• Oct – Dec 23: +1,476
• Jan 24 – Mar 24: -416
• Apr 24 – Jun 24: -1,745
• Jul 24 – Sep 24: -717 (my calculation)

So the EFT staff total in the public service at September 2024 is only 296 less than in June 2023.

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