Oranga Tamariki has spent $824,500 on contractors and consultants in relation to the organisation's restructure, which involves cutting jobs. It plans to spend around $95,000 more in the coming months.
Oranga Tamariki has spent $824,500 on contractors and consultants in relation to the organisation's restructure, which involves cutting jobs. It plans to spend around $95,000 more in the coming months.
Children’s ministry Oranga Tamariki has put hundreds of thousands of dollars towards consulting firms working on its job-cutting plans, as the Government calls for fiscal discipline across the public sector.
Change proposals seen by the Herald and later confirmed by Oranga Tamariki involve a decision to disestablish 632 roles, 70 of which are vacant. It would create 185 new jobs in the restructure.
The Herald previously revealed the agency had called in consulting firms to assist with its change process.
Oranga Tamariki stood by the move, which came under fire from the Public Service Association. In its explanation, the ministry stated it was being provided with specialist advice.
The Government has tasked Oranga Tamariki with finding 6.5 per cent savings for the upcoming financial year. Ministries, departments, and agencies have faced a directive to find savings between 6.5 and 7.5 per cent on average – the latter, larger number given to agencies which have seen significant growth in headcounts from 2017.
Big-four consulting firm Deloitte has charged Oranga Tamariki $697,000, excluding GST and agreement fees. The contracted work, said to be on the ministry’s “organisational design”, took place from November 27 to April 12.
Campbell Squared Communications charged the agency a consultancy fee of $127,500, also excluding GST.
It brings the total spend to $824,500 – without GST and additional fees.
Oranga Tamariki is planning on coughing up more cash to Deloitte. It confirmed the total estimated costs through to completion of the restructure, deemed to be around May or June, would land in at $95,000 – also excluding GST and additional procurement fees.
Oranga Tamariki could not provide a projected cost for future work with Campbell Squared Communications, as it is “contracted to provide services when required”.
In a statement, deputy chief executive of people, culture, and enabling services Caz Anderson said: “Parts of the work relating to the organisation restructure require expertise Oranga Tamariki does not employ as part of its normal everyday business.”
“Expert advice was and is contracted in to ensure the successful delivery of the entire restructure process, from proposal through to final decisions,” Anderson rationalised.
She confirmed Deloitte has now been “re-engaged” to assist with other changes, following feedback on the change proposal.
“[Deloitte’s] expertise is essential for ensuring all kaimahi [worker] feedback is given genuine consideration,” Anderson said.
Agencies have been reducing discretionary spending on catering and travel and stepping back on the use of contractors and consultants.
On the cuts, Finance Minister Nicola Willis has previously said agency chief executives and their staff are expected to use their “good judgment”.
Willis has said a headcount “blowout” had not led to improved results for New Zealanders.
Finance Minister Nicola Willis with a Budget 2024 book during her visit to Blue Star Printers in Petone yesterday. Photo / Mark Mitchell
The Finance Minister confirmed a focus on slashing consultant spending was part of the request to find cost savings.
“As such, we have asked agencies to put forward options for making savings while protecting the frontline services they deliver, including by minimising back-office costs, reducing spending on consultants and stopping low-value programmes,” Willis said.
Oranga Tamariki’s move to call in the consultants was slammed by the Public Service Association (PSA), which represents unionised public servants.
PSA national secretary Kerry Davies had suggested the spending was not appropriate, given the directive to crack down on the use of consultants.
“All this is doing is fattening the profits of high-price consultants and adding to the expense of this rushed and reckless cost-cutting drive,” Davies warned.
Minister for Children Karen Chhour is standing by Oranga Tamariki’s spend.
“I have been advised that Oranga Tamariki did not have the expertise on staff to manage this very comprehensive and extensive restructure and therefore outsourced some of the key aspects of the work to appropriate experts,” Chhour said.
In the year to June, according to figures from the Public Service Commission, Oranga Tamariki spent $35.8 million on contractors and consultants.
Some agencies are looking beyond the Budget as they chase down aspects to cut back on.
The Department of Internal Affairs, the Ministry for Primary Industries and the Ministry of Māori Development Te Puni Kōkiri have all signalled plans to cut spending in the years ahead.
Azaria Howell is a Wellington-based multimedia reporter with an eye across the region. She joined NZME in 2022 and has a keen interest in city council decisions, public service agency reform and transport.
