Hundreds of job losses are probable from the merger of four departments announced yesterday, Prime Minister John Key has indicated.

But the jobs of the ministers currently overseeing them are safe, Steven Joyce says.

Mr Key has confirmed plans to merge four Government departments into a single "dedicated, business-facing" ministry under the ultimate oversight of Mr Joyce, a plan public sector union the PSA says is half-baked.

The Ministry of Economic Development and Ministry of Science and Innovation, which are both already overseen by Mr Joyce, are to merge with the Department of Building and Housing and Department of Labour in a new Ministry of Business, Innovation and Employment, effective from July this year.


The Cabinet expects a "due diligence" report on the plan next month which will provide detailed advice on how the merger will be managed.

While the key motivation for the merger was better co-ordination and a more integrated policy approach to help develop the economy, "efficiencies will be sought over time where they are appropriate" said Mr Joyce.

However, it was too early to say how many jobs would be lost.

Between them the four departments have a headcount of about 3200 or the equivalent to just over 3025 full-time employees.

Asked whether job losses would be in the hundreds, Mr Key told National Radio yesterday: "That was certainly our experience with the Ministry for Primary Industries where we put together, again, a number of agencies."

Figures published by the State Services Commission yesterday showed the number of jobs at the new Primary Industries Ministry was 2027 - 152 fewer than the total for the individual pre-merger departments.

Mr Key didn't want to put a number on expected job losses at the new combined Business, Innovation and Employment Ministry. "We've got to go through all the consultation process, due diligence and do this thing right."

Now dubbed a "super minister" for his sprawling influence across the Government, Mr Joyce last night said there would be no change for ministers.


Maurice Williamson would remain Minister of Building and Housing, Kate Wilkinson would retain her Labour portfolio and Nathan Guy would stay on as Minister of Immigration, with Mr Joyce as the "lead over the agency".

The national secretary of the Public Service Association, Brenda Pilott, said: "Announcing a merger that affects more than 3000 people ahead of actually doing the work to see whether it's a good idea we think is the worst possible way to effect change and restructuring."