'Bigger isn't always better': Labour's Chris Hipkins on coalition's plan to merge government departments

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Labour leader Chris Hipkins says bigger government departments aren't always more efficient than smaller departments.

Labour leader Chris Hipkins says public servant caps can be "arbitrary" and bigger government departments aren't always better at doing the job, as the finance minister looks to downsize the public service.

Nicola Willis will reveal on Tuesday afternoon proposals to reduce the number of government agencies, by telling ministries and departments to come up with plans for amalgamation.

RNZ understands Willis will set out three proposals in her Auckland pre-Budget speech to create efficiencies in the public service, including amalgamating government agencies, more work on digitisation and using AI, and setting a target to reduce the public service headcount to 1 percent of the total population by 2029.