Major public service reshape afoot

Thursday, 28 August 2025

Join the discussion and have your say in the comments.

A major reshape of the public service could be on the horizon.

The Post understands there is potential for a significant consolidation which could reduce the number of departments, ministries and departmental agencies.

The Post understands this was discussed during a Crown Entity board chairperson meeting with the Public Service Commissioner Sir Brian Roche this month and that a number of about 20 was mentioned. There are almost 40 Public Service departments and departmental agencies.

It appeared it could be a shift to merge or absorb into ministries, rather than disestablishment. Changes would need to go through Cabinet.

Roche would not confirm or deny the move, but said that all options are on the table, and his focus is on what agencies are delivering “effectively and efficiently”.

Roche has publicly stated there are questions around the size and organisation of the public sector, “and that there is scope to reduce fragmentation and strengthen individual agencies to focus on their core business”.

“At the same time there are clear expectations on the public sector to improve its efficiency and performance. I have been looking at this, including how to strengthen the resilience and impact of some functions.”

The Government is already considering a triple ministry merger between the Ministry of Transport, Ministry of Housing and Urban Development. And Roche has reportedly refused to rule out the Ministries for Women, Disabled People, Pacific Peoples being absorbed into larger ministries.

Roche said there was a “considerable variety in the way some communities are represented in the public service”.

“Any proposal, if progressed, would retain these functions and their associated branding, thereby ensuring their voice and perspective is maintained in both policy development and service delivery.”

ACT leader David Seymour, who has previously said there should be fewer ministers and proposed a cap of 20, said a reduction of that size would be “quite a big change”.

“But, I think the overall problem is we don't have a clear idea of what things government does and why it does them.”

He said many countries of New Zealand’s size “seem to get by with half as many departments”.

“Simplifying the chains of command and the number of entities would certainly make it a lot easier for people to get their head around what government is doing, how well it's doing it, and which things it needs to continue and which things it needs to stop.'

Public Service Association national secretary Fleur Fitzsimons said “the last thing the public sector needs is more re-structuring”.

“These ideas are radical and would be a chaotic distraction from important work under way in these agencies.

“Mergers at this scale would be disruptive and make it even harder to deliver public services.”

Former Minister Peter Dunne said provided function is protected, “form doesn't matter to the same extent”.

“The problem emerges if their merger or absorption into other departments means the end of their specific functions.”

Dunne said he thought what was being looked at “is a bit of a tidy up around the edges - and the question that then arises is whether that will prove worth from a political perspective. Will the Government at some point decide there's too much… noise involved in doing this for the gains we're going to get from it?

“But a more radical change and a more radical review, probably is long overdue.”

Dunne was Minister for Internal Affairs in both the 90s and between 2014-2017. The Department of Internal Affairs (DIA), as well as issuing passports, has oversight of areas including gambling, digital safety and anti-money laundering.

“The Department of Internal Affairs is a strange model… But actually it works because that department has a really good overview of what government as a whole is doing, because it's got its finger in so many pies, but those individual bits of the pie are pretty much autonomous,” Dunne said.

“They all operate in their own way, but through them… you could draw a common thread about national identity and purpose - to that extent it works.”

The Public Service consists of different collections of organisations - 34 departments, five departmental agencies and four interdepartmental executive boards.

Some organisations sit within 'host departments' - such as the Ministry for Ethnic Communities under the Department of Internal Affairs, and the National Emergency Management Agency under the Department of the Prime Minister and Cabinet (DPMC).

There are also a number of central agencies - DPMC, the Public Service Commission, Treasury, Ministry for Regulation and the Social Investment Agency, which oversee public service performance.

Outside of the public service, within the public sector sits the likes of NZ Police and the Defence Force.

Roche, in a speech in February, said the public service has a number of agencies that are “subscale, and unable to capture the economic efficiencies of others, nor do they have the depth to provide resilience over time”.

“The reality is …a lot of fixed cost and a lot of duplication. The question remains about what the optimal size of a Public Service entity is.”

Comments are moderated during working hours and may not appear immediately.