Public sector staff at risk as services slashed

The Treasury is looking at plans to cut the Government's administrative staff and costs by almost one third with a centralisation of back office services.

Recruiting, IT, finance and "a range of corporate services" in the public sector in offices nationwide are being earmarked for consolidation to save 30 per cent of costs and increase productivity.

Local service firms think they might be shut out of the new initiative after the Treasury made it clear it is looking for a big company to handle the work.

Treasury spokesman Chris Ritchie said the goal was to cut costs through common processes and systems. That could mean outsourcing, shared services or a hub.

A Treasury meeting for professional service companies detailed the project requirements and those attending were sworn to secrecy and told not to say anything to other government departments.

The state services productivity team, a Treasury division, told more than 100 mainly small and medium-sized firms at the meeting on Friday that a single provider was ideal. Nobody at the meeting who was spoken to by The Dominion Post would be identified for fear of losing out on future work, but several said the skills and capabilities required played into the hands of multinationals, and small local operators would be left out.

"The deck is definitely stacked against Kiwi companies," one said.

Treasury productivity team member Parau Tupangaia said he doubted there were many small service providers with the expertise and experience sought.

Mr Ritchie said the idea was to invite service vendors to contribute to the final plan. The intention was to have a call for tenders by November.

Public Services Association national secretary Richard Wagstaff said it was not opposed to centralising government back office functions, but there was more than enough work to be done by the existing public workforce.