Business leaders have welcomed plans to streamline business-facing ministries, hoping the need for multiple interactions will be replaced by favourable policy development.

Prime Minister John Key yesterday said a single business-focused super-ministry would replace the Economic Development Ministry, the Labour Department, the Science and Innovation Ministry and the Department of Building and Housing.

Having to deal with more than one ministry for the same transaction is often raised by the business community as a frustration.

"It has been a bugbear of business for some time that government's very fragmented in terms of the way it faces off against business, and this is going to draw that together in a much more coherent way," Deloitte New Zealand chairman Murray Jack said.

A single ministry could lead to unified policy, Jack said, citing the Labour Department's policy on immigration as not attuned to the needs of business.

BusinessNZ chief executive Phil O'Reilly said though the organisation had good working relationship with each of the ministries, each had its own chief executive and minister to report to, meaning staff could view issues in different ways.

A large, unified ministry with "seriously talented people" in policy development was exciting, O'Reilly said, although benefits would depend on the merger being well executed.

Grant Taylor, Wellington managing partner at Ernst & Young, welcomed the streamlined structure, but warned the merger process was likely to be troublesome.

"Bringing together four pretty large organisations is a major change-management headache for the chief executive potentially. I'm not sure we could point to too many mergers of large departments in New Zealand that have gone seamlessly."

One senior accountancy partner said red tape was often pointed to as the problem "when the real problem is something else".

Council of Trade Unions secretary Peter Conway said merging the Labour Department, which was responsible for working conditions, with business-focused departments, posed risks for staff.

"This merger begs the question – where will the "worker-facing" roles and functions that the [Labour] Department currently provides fit in the new structure?"

- © Fairfax NZ News