Finance Minister Nicola Willis and Public Service Minister Paul Goldsmith have announced a sweeping overhaul: 8,700 roles cut, three ministries merged, another 25 departments told to slash budgets, and AI mandated across the public service.
Severity legend
Findings on this page are colour-coded by impact on the agency or service.
Headline figures from the pre-Budget speech in Auckland.
FTE roles · 2017 → 2029 target
Number of departments administering Budget lines
Operating budgets for "most" agencies will be cut three years running.
Across the board to "most" agency operating budgets.
Compounding on the prior cut.
A cumulative ~11.6% baseline reduction.
Three ministries are already on the way to becoming one mega-ministry. Future minister: Chris Bishop, who "calls it M-Cert".
Combined workforce across the three predecessor ministries: 1,270 staff.
Being merged in
Stated purpose
A "case study" for what's possible. Bishop says he expects MCERT to "cut back on spending and staff costs over the next few years". More mergers will follow over 3–5 years; agencies have been asked to come up with their own merger proposals.
Every department below must cut 2% this year, then 5% in each of the next two years. Bar shows year-on-year workforce change (green = already shrinking, red = grown the fastest).
Frontline and security agencies are ring-fenced from operating budget cuts — but Willis says they may still be involved in mergers and may still cut headcount.
The wider state sector — Te Whatu Ora (health), schools, Crown entities — is not counted in the cost-cutting programme at all.
The Government's Chief Digital Officer will oversee migration of HR, payroll, case management and other systems to the cloud, with AI deployment embedded across all public entities.
Note: When pressed on how he personally uses AI, Public Service Minister Paul Goldsmith said: "well…ugh…ummm" before Willis intervened with "I bet your teenagers are." Willis admitted her own office "hadn't been using a huge amount of AI" but has now asked staff to "educate me about this".
Willis says the savings will be reallocated to:
Coalition support, Opposition opposition, and a "DOGE" comparison from the Greens.
"Those savings… have created significant headroom for higher-priority investments — a total of $2.4 billion over the forecast period, averaging $597 million a year."
"Yes, there will be job losses over time. The public service is not a make-work function — it's not here just to maintain jobs and maintain a position of how it was always run since 1995."
"It's something the ACT Party's been calling for for a very long time, and we're absolutely thrilled to see it. ACT certainly would have done this faster and harder."
"55,000 must be the halfway mark, not the finish line. When National left office in 2017, the public service sat at around 47,000 FTEs — if that was enough then, it should be enough now."
"This is an act of wilful destruction. It will devastate the services New Zealanders rely on every single day. This is irresponsible and reckless — and make no mistake, the price will be high."
"There is no way you could reduce that many people working for our public service without reducing frontline services. These are social workers working with vulnerable kids and families, people working in our prisons, people working at our border, people working in the conservation estate."
"Last year, women paid for Nicola Willis's budget. This time, public servants and their families are going to be paying for it. There could be up to 10,000 families affected."
"The Government is chasing DOGE-style libertarian fantasies right out of Elon Musk's playbook. Nicola Willis is committing New Zealand to arbitrary headcounts which will eat into frontline services."
2017
Baseline: ~48,000 core public service roles (≈1% of population). National in office.
2017–2023
Public service growth rate is nearly 3× faster than overall labour force. Back-office grows faster than frontline. Headcount climbs past 65,000.
2024 → Dec 2025
First wave of cuts under coalition Government via baseline reductions and hiring restraint. Headcount in Dec 2025: 63,657 FTE.
19 May 2026
Willis & Goldsmith announce the structural overhaul: 8,700 more roles, mergers, AI mandate.
July 2029
Target: 55,000 FTE (1% of a ~5.5M population), fewer departments, $2.4B saved.
Deeper context
Four views that didn't fit above — the long historical arc, how fast the workforce really grew, where the money goes, and which departments grew the most.
Core public service FTE ÷ resident population · 1995 → 2029 target
Cumulative growth, indexed to 2017 = 100
Reinvestment priorities named by Willis · indicative split
Annual savings (~$597M) in context of Budget 2026 spending
Green = already shrinking · Amber = modest growth · Red = grew the fastest, biggest target
Self-contained answers to the most-asked questions about the 19 May 2026 announcement.
8,700 full-time-equivalent roles will be cut from the core public service by July 2029, reducing headcount from 63,657 (December 2025) to 55,000.
$2.4 billion over four years — averaging $597 million per year. Savings are earmarked for health, schools, infrastructure, Defence, Police, and debt reduction.
MCERT is the new Ministry of Climate, Environment, Resource Management and Transformation — combining the Ministry for the Environment, MPI environment functions, and parts of DIA. It's the first confirmed merger of the overhaul.
13 agencies are excluded from operating budget cuts: NZ Defence Force, NZ Police, Corrections, Oranga Tamariki, Ministry of Health, Ministry of Justice, Ministry of Education, GCSB, NZSIS, Education Review Office, Crown Law, Ministry of Defence, Serious Fraud Office. They can still be merged.
Greens spokesperson Francisco Hernandez compared the programme to Elon Musk's US Department of Government Efficiency, saying the Government is committing to "arbitrary headcounts which will eat into frontline services". The Government rejects the comparison.
Compounding operating budget cuts: −2% in Budget 2026, then −5% in each of the next two years — a cumulative ~11.6% baseline reduction. AI adoption is mandated; headcount must be reported quarterly.
New Zealand has 39 departments — more than triple Finland (12), more than double Australia (16), and well above the United Kingdom (24). ACT's policy is to reduce this to 30.
Open questions
The announcement was big on top-line numbers and short on operational detail. Three questions the Government hasn't answered yet.
Beyond MCERT, no specific mergers were named. Agencies have been asked to propose their own. Seymour says the final department count will be "close" to ACT's 30-ministry policy.
The PSA is demanding the Government tell New Zealanders before the election. No service-level detail in the announcement — only that 13 protected agencies are ring-fenced from operating cuts.
Willis says cuts will come from "natural attrition, stopping duplication, streamlining back-office functions". PSA says the maths doesn't work without structural disestablishments.