Key to outline new public sector efficiency drive

Key to outline new public sector efficiency drive

Feb. 7 (BusinessDesk) – Wringing further efficiency out of the public sector will be a key feature of Prime Minister John Key’s speech tomorrow at the opening of Parliament for the year.

But Key is refusing to be drawn on whether that could lead to further departmental amalgamations, included a widely rumoured tie-up between the Treasury and the State Services Commission.

Answering journalists’ questions on that suggestion after today’s Cabinet meeting, Key said: “I will leave you to get a better feel for that tomorrow.

“There won’t be huge detail, but those details will become more clear in the next few months.”

While the government was already managing its spending cautiously, and has cut back the money available for new spending this year from $1.2 billion to between $800 million and $900 million, it still had “work to do” to improve the efficient delivery of taxpayer-funded government services.

“We’ve made some changes in the last two years, but we don’t believe our work there is done.”

Key said it was important that state sector reform was based on a set of principles.

“There need to be good reasons for amalgamations or elimination of services. We’re starting to talk to (government agency) CEO’s about that now.”

Key also announced a visit to New Zealand on Feb. 16 and 17 by the Australian Prime Minister, Julia Gillard, but poured cold water on any hope that Australia might relent in its decades-long opposition to trans-Tasman cross-recognition of imputation credits attaching to company dividends.

“I wouldn’t hold my breath it’s going to happen any time soon,” he said.

Under sustained questioning on recent weak economic statistics, Key defended his government’s economic policy priorities and claimed unemployment, which came in unexpectedly high for the December quarter, was a “lagging indicator” and would be slow to respond to economic recovery.

Similarly weak job growth and setbacks to economic growth had been experienced in the United States, Britain and Australia in the second half of last year, a period of “anaemic” growth for New Zealand.

(BusinessDesk)

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