New Zealand's public service has grown by 4.5 percent over the past recorded year, with the average annual salary up more than $6000.
The release of the Public Service Commission's latest data comes ahead of the formation of a new Government, likely led by National which has promised major backroom cuts. The ACT Party, National's likely partner in Government, wants to see around 15,000 public servant roles gone.
The data shows the public service workforce has increased by 2736 full-time equivalent roles or 4.5 percent to 63,117 in the year to June 30, 2023.
The biggest increases were at the Ministry of Business, Innovation and Employment to immigration services and do work in the likes of market competition, climate change and construction. The largest decrease was at Customs due to the end of the fixed-term officers working on COVID-related Maritime Border Order.
"These public servants delivered high-quality services, responded to global challenges, while implementing Government priorities. Just under half work in the Wellington region, with 55 percent spread across the rest of the country," the commission said.
The increase of 4.5 percent comes after a small decrease between 2021 and 2022, and is below the annual growth rate seen in the five years from 2017 to 2022.
"Labour market conditions remain tighter than usual, which has tended to make it more difficult for agencies to recruit than pre-2020.
"However, these conditions have somewhat eased in the last 12 months and as a result, unplanned turnover levels, while still above average, have decreased from last year’s record high. Some of the overall Public Service workforce growth this year is attributable to filling vacancies."
The commission said the two largest groups of workers are inspectors and regulatory officers, and social, health and education workers.
The average annual salary is $97,200, up from $90,800 last year (a 7 percent increase).
"This is the highest annual increase in public servants’ salaries since records begin in 2000," the commission said.
"Private sector average earnings increased at a higher rate (7.7 percent) over the same period — calculated using average total hourly earnings for the private sector from Stats NZ’s Quarterly Employment Survey."
The commission said the biggest pay increases were for the lowest-paid and non-managerial staff, including Pacific men and women. Māori men and women also had above average increases in average pay.
"In late 2022 Government agreed parameters for a public sector pay adjustment (PSPA) over two years. This included increases to base pay of $4,000 in year 1, and the higher of $2,000 or 3 percent in year 2. Year 1 PSPA increases occurred from either 1 December 2022, or 3 April 2023, and have driven increases in the Public Service average salary this year."
The number of women in senior management roles is at 55.9 percent, up from 55.8 percent last year or 39.8 percent in 2020. The gender pay gap is also at 7.1 percent, the lowest ever and down from 18.6 percent in 2000 when it was first recorded.
"The Māori pay gap is now 5.4 percent, down from 6.5 percent in 2022 and 11.2 percent in 2018. The Pacific pay gap has fallen to 16.6 percent, down from 17.7 percent last year and 21.6 percent in 2018. However, the Asian pay gap is 13 percent, up from 12.4 percent last year," the commission said.
The commission said the average remuneration for chief executives increased 2.3 percent in the year. The net result over the last five years is a 2.2 percent decrease, the commission said.
The share of operating spending on contractors and consultants as a percentage of spending on the Public Service workforce has fallen from 14.5 percent to 13.1 percent. That compares to 13.4 percent in 2017/2018. Looking at it in dollar terms, it has fallen from $918 million to $912 million.
The National Party, which appears to be able to form a Government with the ACT Party on the preliminary election results, has promised to make significant backroom cuts.
It wants to make an average 6.5 percent cut to public services, which it would do by reducing advertising and public relations spending, stopping work programmes not supported by National, leaving some job vacancies empty, retiring some working groups and stopping programmes to refurbish offices or upgrade property leases.
This is on top of $4 billion in savings identified by the Labour Government in August. About $1.4 billion of that over four years was expected to come from public sector agencies being required to trim 1 or 2 percent of their existing baselines. Labour also wanted agencies to pull back on consultant and contractor spending.
The ACT Party wants to return the public service to 2017 levels, saving it about $1.2 billion per year. This would lead to a reduction in about 15,000 jobs.
