Hipkins unconvinced by govt's plan to merge departments

Labour leader Chris Hipkins says public servant caps can be "arbitrary" and bigger government departments aren't always better at doing the job, as the finance minister looks to downsize the public service.

Nicola Willis will reveal on Tuesday afternoon proposals to reduce the number of government agencies, by telling ministries and departments to come up with plans for amalgamation.

RNZ understands Willis will set out three proposals in her Auckland pre-Budget speech to create efficiencies in the public service, including amalgamating government agencies, more work on digitisation and using AI, and setting a target to reduce the public service headcount to 1 percent of the total population by 2029.

Hipkins told RNZ's Morning Report there were a lot of contradictions within the proposal so he wanted to see the details.

"Bigger isn't always better, bigger government departments aren't always more efficient than smaller departments. Some of the bigger agencies are the most bureaucratic, with the most double handling...

"So I don't think bigger is always better."

Hipkins said Aotearoa needed to have a public service that was the right size for the job.

"Rather than setting an arbitrary cap we need to ask what is it we want the public servants to do."

Public service agencies were easy to pick on, Hipkins said, and many were working on preparing for things people might not understand why it was needed - things like earthquakes and pandemics.

That "just in case" work was really important, he said.

Another idea many people had was that people working in public service were all sitting behind a desk in Wellington.

"This just isn't true," Hipkins said.

Hipkins did agree new technological tools, including AI, could be used to increase efficiency in the public service.

There are 42 ministries and agencies currently in the public sector and just over 63,000 full-time workers.

Willis says the headcount blew out by far too much under the previous Labour governments - it was 48,000 in 2017 and had increased to 57,000 by 2020.

Getting the number of public servants back to 1 percent of the total population by 2029 would require a cut of potentially 8000 jobs, with the government believing AI and greater digitisation like what is used in the private sector could pick up the workload of public servants currently in the system.

While 43 percent of the public sector workforce lives and works in Wellington the other 57 percent is based all over the rest of the country.

About 21 percent of the workforce is in Auckland.

Last year, the Public Service Commissioner Sir Brian Roche told Mata he was looking at a shakeup of agencies.

At the time, he said all options were on the table, but indicated ministries' functions and branding would remain.