Tax jobs next to face axe

Last updated 05:00 21/04/2009
Fairfax Media
BEING AUDITED: Inland Revenue is tipped to be next in line for a shake-up, with hundreds of jobs on the line.

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Inland Revenue is tipped to be next in line for a shake-up, with hundreds of jobs on the line as the Government's call for public service restraint bites.

The round of belt-tightening reviews in the public sector comes as the Government prepares to extend its nine-day fortnight scheme to smaller businesses and defends its February jobs summit in the face of rising unemployment.

Prime Minister John Key confirmed yesterday that unofficial figures pointed to as many as 18,000 more people on the dole than a year ago, with official statistics next month likely to put the increase much higher.

This is compared to just 117 jobs which have been saved so far by the Government's nine-day fortnight a scheme that provides taxpayer-funded wage subsidies to companies considering redundancies.

Public service job-restructuring proposals have affected more than 100 jobs so far but government departments say they are minimising redundancies by relying on natural attrition and hiring freezes.

The next in line is tipped to be the Inland Revenue Department, with several hundred jobs nationwide affected by restructuring. It has 6000 staff.

Inland Revenue confirmed yesterday it was reviewing its business operations, "but we are not in a position to say anything more as yet", a spokeswoman said.

Revenue Minister Peter Dunne would not confirm the figure and said no final decisions had been made.

Mr Key rejected suggestions that the drive for restraint in the public service was at odds with the Government's other job-saving initiatives.

"There are different issues here. There's firstly a desire to keep as many New Zealanders in work as we possibly can ... There is also a short- to medium-term issue of right-sizing the public service and making sure it fits with the objectives of the new government. We're not on a slash and burn exercise."

The Government confirmed yesterday that three companies had signed up to its nine-day fortnight so far, with a further 60 inquiries. They include Fisher & Paykel and Oamaru-based Summit Wool Spinners, and a third company which does not want to be identified.

Mr Key said the nine-day fortnight scheme would build up over time and promised more "wide-ranging" programmes in the Budget. He would detail plans this week to extend it to companies with fewer than 100 employees.

There was support, meanwhile, from unions for the nine-day fortnight. The National Distribution Union said 57 jobs had been saved at Summit Wool Spinners, which would make a big difference in a community like Oamaru.

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The Government yesterday also trumpeted work to upgrade state homes announced in February as keeping 935 people in work.

But there was a knockback over another key jobs summit initiative: a plan for banks to set up an equity fund in partnership with the Government to help out struggling businesses was scrapped.

Mr Key said the banks had decided the scheme was not viable.

Labour leader Phil Goff said the jobs summit had so far fallen short of the Government's rhetoric.

- The Dominion Post

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