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IRD strikes another blow to rural economies

16 December 2010

In a major overhaul of its frontline services the Inland Revenue Department (IRD) is proposing to cut so-called ‘virtual’ jobs from regional communities and transfer them to metropolitan hubs.

Communities like Greymouth, Gisborne and Timaru are the first to be targeted with 10 out of 22 jobs going from the East Coast operation, 10 out of 17 going from the West Coast and 16 out of the 27 jobs in Timaru are being axed.

Services in Dunedin, Whangarei, Tauranga Rotorua, Palmerston North, Napier, Invercargill and New Plymouth may be scaled back at a later stage

“There’s a very real need in these three centres for jobs and economic stimulus. These cuts are another heavy blow,” says Public Service Association National Secretary Richard Wagstaff.

“Those who lose their jobs may need to move to other locations and that will take spending power out of the communities and have a significant impact on local businesses.

“The government’s mantra of boosting so-called frontline services seems to be at the expense of rural communities. The Ministry of Justice is also looking at removing jobs from smaller towns. Government is standing back telling departmental chief executives to operate within restricted budgets but surely taking jobs from the regions and transporting them to urban centres is out of synch with the government’s bigger picture?

“The irony is that these jobs are what IRD calls ‘virtual jobs’ – jobs the department admits can be done anywhere but wants to move them out of the regions and into the main centres for ‘economies of scale’. That flies in the face of the department’s ethos of being a flexible organisation. The monitory arguments are also questionable given that redundancies will significantly increase costs and that less visibility in the regions could result in reduced compliance.

“The cuts for these three small sites represent a staff reduction of around 50 percent. If this trend continues for phase two and three of IRD’s restructuring more than 500 jobs could go.

“While the public sector pursuit of efficiency is to be commended, it shouldn’t be at the expense of local communities.

“A strong case could be made for moving more of these ‘virtual jobs’ to the regions to help revitalise local economies and ease the pressure on amenities such as transport and housing in our main centres, says Richard Wagstaff.”


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