Revised diplomacy trim just start of wider cuts'

John Allen. Photo / Mark Mitchell

The head of the Foreign Services Association says a backdown in the restructuring of the Foreign Affairs Ministry is slightly better news for diplomats, but he expects it to be only the start of wider-ranging cuts.

Ministry of Foreign Affairs and Trade chief executive John Allen yesterday announced the final shape of that restructuring, saying 79 jobs would go and cuts to overseas diplomats' allowances had been reduced.

The decisions fall far short of his original proposal, under which 304 jobs - one-fifth of the ministry's work force - were tagged to go.

Almost all would have had to reapply for their jobs and diplomats serving overseas would have lost the allowances for families.

Association president Warren Fraser said it was yet to be seen whether the backdown was enough to stop some diplomats leaving. It was much better than the original proposal and he agreed with a decision to give heads of mission more budget control over their own posts. But 79 jobs were going and senior diplomats would still have to reapply for their jobs.

He was also concerned about the other savings Mr Allen said were needed.

Mr Allen said the changes would save $10 million to $12 million a year, far short of the $24 million originally aimed for.

The $9 million cost of the restructuring would be recovered within a year, and other savings measures such as selling property, moving into cheaper offices and downsizing some posts would produce the $24 million the Government had asked for.

Prime Minister John Key said he didn't believe the process would damage New Zealand's international relations. The ministry needed to modernise and focus more on New Zealand's future relations with Asia. It was important to support Mfat's diplomats, but also acknowledge that change was needed.

NZ First leader Winston Peters criticised the decision to downgrade representation in Europe, including closing the Stockholm Embassy he set up as Foreign Minister in 2008, saying it would save a pittance compared to the benefits lost.

"It's a false economy. Europe is a huge market for New Zealand and you don't neglect a good market."