24 Feb 2014

Millions spent on contractors

3:53 pm on 24 February 2014

The Government is spending tens of millions of dollars more on contractors than it did five years ago.

Finance Minister Bill English says it is getting value for money, but Labour says it's wasteful and spiralling out of control.

Finance Minister Bill English.

Finance Minister Bill English. Photo: RNZ

The Education Ministry spent $24.99 million on contractors in the 2012-2013 financial year.

That's more than five times the $4.42 million it spent five years ago.

The Ministry of Business, Innovation, and Employment spent $46.31 million on contractors and consultants.

That's up from the $31.56m its equivalent agencies spent five years earlier, though there is some missing data.

Labour says the Government is suffering the consequences of laying off workers in the public sector.

Labour leader David Cunliffe.

Labour leader David Cunliffe. Photo: RNZ

Leader David Cunliffe says it's ideological nonsense and a waste of public money.

"Look I'm amazed and pretty horrified. They're sacking people to keep their numbers down and then, probably, hiring back some of the same people as much more expensive consultants a week later. That's why the consultancy bill has gone through the roof."

But Bill English says the government is demanding much better performance across the public service.

"And by and large we are getting better performance. Labour's problem is they believe the public service knows everything. I don't think anyone else in New Zealand believes that.

"And when we are trying to solve quite complex problems, we need skills from outside the public sector so we can do a better job."