About 2,700 staff at the Ministry of Business, Innovation and Employment walked off the job for an hour on Wednesday morning, one day after Stats NZ confirmed annual inflation had climbed to a two-year high of 4.1 percent.
The stop-work meetings ran from 9am to 10am and were held in central Auckland, west Auckland, south Auckland, Wellington central, Porirua and Christchurch, with remote sessions for staff in Hamilton, Nelson and Palmerston North. The Public Service Association, which organised the action, said members had rejected the ministry’s collective offer and wanted the size of the gap between the offer and the cost of living put on the public record.
The timing was not accidental. On Monday, Stats NZ reported that the consumer price index rose 1.5 percent in the June quarter and 4.1 percent over the year, pushing inflation well above the Reserve Bank’s 1 to 3 percent target band. Petrol was up 27.5 percent over the year and diesel up 71 percent, and together the two fuels accounted for close to two-thirds of the quarterly increase. Strip fuel out and annual inflation would have been 2.9 percent.
That distinction matters to the argument now running through the public service. The government can reasonably point out that most of the current inflation spike is imported and sits at the fuel pump, well outside its control. Public servants can equally point out that the pump price is not optional for someone driving to a processing centre in south Auckland, and that a pay offer indexed to core inflation still leaves them behind on the money that actually leaves their account each fortnight.
PSA national secretary Fleur Fitzsimons said the offer failed both tests. “MBIE workers have overwhelmingly rejected a pay offer that doesn’t even keep pace with inflation β they feel undervalued,” she said in a statement released on Tuesday.
She said the structure of the offer was as much of a problem as the headline number. “The current offer includes changes to pay that mean it will take staff longer to reach higher pay bands, at the same time as the cost of living keeps rising,” Fitzsimons told RNZ. Under most public service collective agreements, staff move up a band through annual steps, so lengthening the steps reduces lifetime earnings even when the annual percentage looks unchanged.
Fitzsimons also made the case for the work itself. “MBIE workers help run New Zealand’s economy, from employment and immigration services to consumer protection and business support. They deserve to be treated with respect and not presented with a deal that takes them backwards and told to accept it,” she said.
The largest single group in the MBIE bargaining round is immigration officers, most of whom earn about $70,000 a year. These are the staff who assess visa applications, work through the residence queue and staff border operations, and the ministry has spent much of the past two years under scrutiny over how well that side of the house is run. The union quoted one member saying it was “getting harder and harder to keep up, let alone have luxuries,” and another saying the squeeze had them thinking about leaving. “This makes me think Australia is a better option and I may need to leave the organisation or country for a better future,” the worker said.
Retention is the part of this dispute with the sharpest edge for the government. Immigration processing times are a standing political liability, and the officers who clear the queue are exactly the group with a live option across the Tasman.
MBIE is not the only agency in the frame. The PSA said bargaining is underway for more than 10,000 public servants across MBIE, the Department of Internal Affairs, Corrections and the Ministry of Social Development, and that offers across those agencies are landing below inflation. Internal Affairs members voted to strike earlier this month. If the pattern holds, the government is looking at a co-ordinated pay round across four large agencies in an election year rather than a single ministry making noise.
The backdrop is a public service that has been shrinking. Finance Minister Nicola Willis has driven a programme of departmental amalgamations and job reductions, and the Ministry for the Environment was folded into the new Ministry for Cities, Environment, Regions and Transport on 1 July. Agencies running with fewer staff and flat budgets have limited room to fund a pay settlement without cutting somewhere else, which is a large part of why offers have come in where they have.
The most recent workforce data from Te Kawa Mataaho Public Service Commission, covering the year to 30 June 2025, put the average public service salary at $103,300, up 1.6 percent on the year before, with the median at $90,200, up 1.5 percent. Those are averages across a workforce whose shape has changed, so they are not a clean read on what any individual worker took home, but they do show pay movement running below price movement for a second year.
Neither MBIE nor the responsible minister had commented publicly by Wednesday morning. RNZ said it had approached the ministry for a response.
An hour-long stop-work meeting is a modest opening move by the standards of industrial action, and both sides know it. It costs the ministry very little service time and it costs members very little pay. What it does is establish that members will act, and it puts a number on the room in a year when the government would rather be talking about inflation coming down than about the people who process visas asking for a raise. Whether it goes further depends on what MBIE puts on the table next.
With the 2026 general election approaching, public sector pay and staffing are shaping up as a live dividing line between the parties. If you want to see where each party sits on this and other issues, our voting tool lets you compare their positions before you vote.
Do you think public service pay offers should keep pace with inflation, or does a shrinking budget make that unaffordable? Have your say in the comments below.
This article was written by AI, briefed to report the facts, hopefully without some of the bias people bring to the job π
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