Defence Minister Jonathan Coleman has called a damning report on Defence Force cuts "old news" and claims the Force was already moving on.
Auditor-General Lyn Provost found that a New Zealand Defence Force (NZDF) cost-cutting project had made some savings, but would not meet its targets.
Furthermore, the process had been done in such a damaging way that staff morale had been dented, large numbers had left as a result, and the Force's ability to do its job had been undermined.
Mr Coleman responded to the report yesterday: "In retrospect things could have done better, but overall I wouldn't agree that this process has been a failure."
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He said staff morale had since climbed again, and the savings had made it possible to fund new helicopters and other capabilities.
The minister also said the findings in the report were "old" and that the Auditor-General had made no recommendations.
"There is nothing new in this report. The NZDF is largely moving on from this."
The Government asked the NZDF in September 2010 to find $400 million in savings over four years.
Part of the NZDF's response was to convert 1400 logistics and administration positions into civilian positions.
This was expected to save $20.5 million a year which would be redistributed to improve the proportion of front-line troops.
The Auditor-General said that this target would not be met and revised the expected savings to $14.2 million a year.