MPs have been told that a restructuring plan for the Ministry of Social Development has been brought forward because of the recession.
Chief executive Peter Hughes briefed Parliament's Social Services Committee on Wednesday on his proposal to eleminate 200 jobs.
Mr Hughes expects 60 to 70 new frontline positions will be created in the process.
He told MPs the changes would have been needed eventually, but are urgent because of the tough economic times and increasing demand for services.
Mr Hughes said the Ministry is currently recruiting more than 100 case managers and there will be about 50 new social worker positions later in the year.