Table of Contents
Summarised by Centrist
National has promised to cut about 8700 core public service jobs over the next three years if re-elected, as part of a wider plan to save $2.4 billion. National says it will modernise an “80s relic” bureaucracy through AI, automation and agency mergers.
Finance Minister Nicola Willis said the public sector had become bloated after a “period of largesse” under Labour and confirmed the government would target no more than 55,000 full-time equivalent public servants by mid-2029, down from just over 63,000 today.
A central justification for the cuts is the government’s belief that AI and digital systems can permanently reduce the size of the bureaucracy while improving services. Willis said many parts of government remained stuck in “outdated ways of doing things” and accused agencies of prioritising “box-ticking over outcomes”.
Prime Minister Christopher Luxon said tasks such as identity verification, income checks and Working for Families administration could increasingly be automated.
The plan includes a “sinking lid” on departmental operating budgets, with most agencies facing a 2 per cent cut next year, followed by 5 per cent reductions in each of the following two years. Teachers, nurses, police and frontline Health NZ staff are excluded from the target.
Labour leader Chris Hipkins criticised the proposal as “arbitrary”. However, Hipkins also acknowledged Labour itself proposed public service cuts while in government in 2023, including a 2 per cent reduction target. He argued those changes mainly involved eliminating vacant roles rather than forcing redundancies.
