Foreign ministry-staff cuts tipped

Monday 9th January 2012

The Ministry of Foreign Affairs and Trade is in talks with staff and unions over the fate of some 200 positions tipped to be cut as the government cracks down on public spending.

The ministry confirmed a report in the New Zealand Herald that it’s set to axe almost a fifth of its workers, saying it has embarked on a “significant programme of change.” MFAT expects to finalise numbers and positions by the end of March.

“Changes are expected to result in a smaller ministry, with a new business model, simpler systems and improved technology,” a spokesman told BusinessDesk in an emailed statement. “Once the changes have been fully implemented it is anticipated the ministry will have around 200 fewer roles globally.”

In June last year, MFAT chief executive John Allen told Parliament’s Foreign Affairs and Trade select committee he wanted to reduce job numbers by about that amount as part of the government’s focus on cutting costs. Foreign Affairs Minister Murray McCully has previously said he directed Allen to rein in the ministry’s costs.

Finance Minister Bill English has said there’s “too much duplication and waste” in the public sector which will be targeted in a bid to get the government’s finances back in black.

In May, English said savings of 10 to 15 percent in back-office administrative costs could be achieved.

A Treasury report last year found the biggest opportunity to reduce the cost of back-office functions was in information and communications technology services, which would require a standardised system across public sector agencies.

As part of its move to clamp down on costs, MFAT recently advertised a global banking contract to handle the $110 million spent by diplomatic posts each year in an additional bid to cut costs and break their habit of using hard-to-monitor cash.

BusinessDesk.co.nz

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