Hon Tony Ryall
Minister of State Services

10 November 2009
Media Statement

Public Service bureaucracy growth halted

State Services Minister Tony Ryall says a report released today confirms the Government has halted the growth in public service bureaucracy.

"The Human Resources Capability Survey 2009 shows that the Public Service is heeding the Government’s call for wage restraint and a smaller core government administration" the Minister says.

The Survey, released by the State Services Commission, reports a decline in the number of public servants since December 2008 and shows the growth in public service wages has slowed.

"From 2000 the number of public servants grew by 54%, and every year their base salaries increased on average by 4.5%" says Mr Ryall.

"That kind of growth is untenable in the current economic situation. That’s why earlier this year the Government set a cap on the number of staff in core government administration as at 31 December 2008 and released Government’s Expectations for State Sector Pay and Conditions."

The State Services Minister says for the year the survey covers, there was an overall increase of 2.5 percent in the number of public servants. He says the annual growth was driven by a 4 percent rise in the second half of 2008. But the number of full time equivalent public servants decreased by 1.4 per cent in the six months to 30 June 2009.

“Together with the capping figures the Government released in September, the data confirms that the growth in the bureaucracy has been halted."

While the average base salary in the Public Service increased by 5.3 percent in 2008/09, the Statistics NZ Labour Cost Index (LCI) indicates that most of the annual Public Service wage growth occurred between July 2008 and December 2008.

The LCI released last week shows that wage growth in the September quarter for the core Public Service is 0.2 percent, compared with 0.4% in the private sector. These sectors experienced an annual movement of 1.9% and 2.0% respectively.

“The Government has been quite clear in communicating its expectations of restraint to the Public Service, and these latest figures show that message has been understood and is being actioned,” Tony Ryall says.

However, health and education in the wider public sector continue to experience higher wage growth than any other sectors due to agreements entered into over the last couple of years under different economic conditions.

The HRC is published on the SSC website: http://www.ssc.govt.nz/hrc-survey-2009

ENDS

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