The impact of Oranga Tamariki changes to funding and contracts
, and their rely on access to a range of services funded and delivered by government agencies, organisations and social service providers in the oranga tamariki system.
These services include parenting, counselling, therapeutic, health and education services, programmes to address family violence and transitional support to help rangatahi move towards independence. In the oranga tamariki system, Oranga Tamariki has primary responsibility for funding these services. Other government agencies such as the Ministries of Health, Education and Social Development also have responsibilities.
Social service providers play a major part in how Oranga Tamariki delivers on its role, statutory functions and duties. It is important that providers deliver services and supports that address the needs of tamariki, rangatahi and their whānau and provide value for money.
In 2024/25, Oranga Tamariki contracted 509 social service providers with spending totalling about $543 million.135
For providers to consistently deliver services that meet the needs of tamariki, rangatahi and their whānau, they need clear and timely communication from their funding provider and to be involved in changes so they can manage transitions without disruption. Poorly managed changes can impact access to and the provision of services.
In 2024, Oranga Tamariki made contract and funding decisions that created uncertainty, reduced funding, put strain on its relationships and caused disruption across the social services sector. This led to an inquiry by the Office of the Auditor-General (OAG) that found that the changes had been made without sufficient consideration of the needs of tamariki, rangatahi and their whānau and that significant improvements were needed.
Two-thirds of tamariki and rangatahi accessing services in the system are Māori. Almost onethird of Oranga Tamariki contracted funding is for and Māori social service providers. This means changes to funding and contracting arrangements have a substantial impact on Māori accessing the services they need. The impacts are both immediate and longer term.
"The current funding environment is challenging, that kind of slash and burn approach, which is what we’re currently operating in. It instils fear and worry in the workforce, losing jobs and [impacting on] our own families. We are working with families, [seeing] loss and reduction of employment and the impact on our staff and that something is happening to us.” COMMUNITY ORGANISATION LEADER
"When that funding changed, it caused us mayhem.” ORANGA TAMARIKI LEADER
Challenges with funding and contracting are longstanding
There are longstanding challenges with the funding of services and supports for tamariki and rangatahi and their whānau in the oranga tamariki system. Some services have been underfunded, leading to access issues, long waitlists and agencies being unable to respond early to needs. Government agencies have not prioritised the needs of tamariki, rangatahi and their whānau in the oranga tamariki system. These challenges have been covered in our Experiences of Care in reports and our 2023/24 Outcomes for Māori report.136
"Funding available to Oranga Tamariki or other agencies does not follow the child, and social workers are still having to spend time negotiating for the services and support that tamariki need.”137
"… funding stand-offs between agencies result in tamariki and rangatahi in the care of the State missing out.”138
Oranga Tamariki was aware of problems with its procurement and contract management practices before the 2024/25 contracting round. Both Oranga Tamariki kaimahi and social service providers had raised concerns over several years, with Oranga Tamariki identifying that improvements were needed following its 2022/23 contracting round.
Oranga Tamariki was under pressure to reduce funding
Oranga Tamariki entered 2024 facing several financial pressures and identified that its 2023/24 spending was likely to go over budget.
In November 2023, the Minister for Children directed Oranga Tamariki to refocus its spending on its core statutory functions and activities, particularly tamariki and rangatahi in care. This reduced its focus on prevention and early intervention and may mean Oranga Tamariki did not meet some of its broader responsibilities under the Oranga Tamariki Act.
At the same time, the Government required all government agencies to reduce budgets. Oranga Tamariki needed to deliver savings of 6.5 percent across its overall budget for 2024/25. During this time, like other government agencies, Oranga Tamariki restructured to reduce staff numbers as a way of creating savings.
In response to budget pressures, Oranga Tamariki also made decisions to reduce spending on contracted services for tamariki, rangatahi, whānau and caregivers within a highly compressed timeframe. It also sought to recover funding for services that had not yet been delivered by social service providers.
We understand that Oranga Tamariki was the only government agency that reduced frontline contracts for social services being delivered to tamariki, rangatahi and whānau at this time.
The Auditor-General found Oranga Tamariki needed to make significant and urgent improvements to its management of funding and contracts
The OAG report on the 2024/25 funding round139 makes recommendations focused on improving planning, governance, decision making, engagement with providers and overall contract management.
The OAG found:
- no evidence that Oranga Tamariki understood how its decisions would affect tamariki, rangatahi and their whānau, which was unacceptable given its core role
- Oranga Tamariki was poorly prepared for the 2024/25 contracting round, lacked a coherent strategy and did not consistently follow good procurement practice
- the views of regional kaimahi on changes to services and contracts were not reflected in top-down decisions by national office
- most contracts were not awarded through a transparent and competitive process
- providers were not consistently paid promptly
- Oranga Tamariki had not taken account of its commitments to Tiriti o Waitangi partners in managing contracts.
"We found that Oranga Tamariki was poorly prepared to carry out the 2024/25 contracting round. It did not have a strategic approach to procurement and did not plan the contracting round well. Oranga Tamariki did not provide adequate advance warning about reconciliation, which was a change in process, and service providers were taken by surprise. Contracting decision-making was left until late in the process, poorly documented, and not adequately informed by evidence of how decisions would affect children and their families”.140
In our regional engagements, we heard about the far-reaching and range of impacts of Oranga Tamariki decisions during the 2024/25 contracting round. Most of what we heard was from social service providers and Oranga Tamariki kaimahi about their experiences of the changes. What we heard closely echoes the findings of the OAG report.
Community organisations described late, unclear and inconsistent decision making, limited engagement and ongoing uncertainty about their contracts. One community organisation told us its funding was reduced by 70 percent and the explanation for this from Oranga Tamariki was that it was for “a budgetary reason”.
"The contracting process for the ‘new contracts’ did not adhere to any previously published funding policies. This lack of transparency is deeply concerning. During the contracting negotiations, Oranga Tamariki failed to disclose until the last minute that they were not following any established policies.” MĀORI SOCIAL SERVICE LEADER
Funding decisions and poor communication undermined relationships, trust and workforce stability
Social service providers told us that contract and funding uncertainty has made workforce planning difficult, contributed to organisational instability and undermined trust in commissioning relationships.
"The driver from Oranga Tamariki is they are trying to figure out what we haven’t delivered so they can claw back funding. However, there’s been no discussion on how we can do it better. It’s about trying to find fault and it’s a deficit model. It just creates a distrust [with Oranga Tamariki].” NGO LEADER
Several social service providers noted that the way funding decisions were made reduced confidence in Oranga Tamariki as a long-term partner and affected the quality of relationships with communities.
"It’s really tricky when we, as an organisation, are pushing our values and our partner [Oranga Tamariki] is not working with the same values. Our kaimahi are asking how can we continue to work with Oranga Tamariki when they’re not upholding the values. We can’t afford to not have a relationship with Oranga Tamariki, but they’re not working in good faith.” NGO LEADER
We also heard from Oranga Tamariki kaimahi in the Bay of Plenty and Wellington how funding cuts have damaged relationships
"Valued services locally that have been working for us for years were taken by surprise, but those decisions are made nationally and it’s the local [Oranga Tamariki kaimahi] who have to deal with the fallback. I was down in [region] last week because a provider said they don’t trust us.” ORANGA TAMARIKI NATIONAL OFFICE LEADER
"Our community partners are losing faith in us, and the relationship with them is getting strained.” ORANGA TAMARIKI SITE LEADER
We heard that funding clawbacks and tighter controls have removed flexibility for providers to deliver services in ways that can address the needs of , and they are working with.
"We went through a hardline reconciliation process with the contracts last year whereas we used to be more flexible [in the past]. If funding was underutilised in one contract, [organisations] would use it in a different way. The money was being spent in the right places, it’s just the contracts didn’t match.” ORANGA TAMARIKI NATIONAL OFFICE LEADER
In Greater Wellington, we heard from two and Māori providers about the competitive environment that has been created following cuts. They told us about a fragmented community provider landscape, particularly post-COVID-19, where providers are having to compete against one another for funding.
The 2024/25 reporting year was the first time in six years that Oranga Tamariki had reduced its funding for iwi and Māori providers. Before this, funding for iwi and Māori providers had been steadily increasing year on year.
We heard that the competitive nature of government contracting means that a provider may try to remain involved in providing services identified, in things like FGCs plans, even when another provider is a better fit.
"There are great partnerships, but as soon as money is on the table, everyone is going to compete, it’s unhealthy.” MĀORI SOCIAL SERVICE LEADER
We also heard about the impact of this on tamariki and rangatahi.
"If a rangatahi says I don’t want to be with you, I want be with [another service], we say that’s okay, that’s a good idea and help them get there, but now maybe it’s a bit more competitive cos it’s all about the funding.” MĀORI SOCIAL SERVICE LEADER
Funding cuts worsened service availability and increased waitlists for tamariki and rangatahi
Oranga Tamariki cuts to funding and contracts worsened the already limited availability of services. We were told about the reduced availability of mentors, disability services, youth justice intervention programmes, and drug and alcohol counselling. We also heard that increased demand on remaining services contributed to longer waitlists and less ability to respond early to needs.
"Functional Family Therapy, [Triple P parenting programme] and Kia Puāwai now have a 12-week wait list and it’s likely to increase. In the email, it said it’s because [Oranga Tamariki] cut our contracts. We lean on [providers] and they have done a fabulous job for whānau and working with kids with high and complex needs.” ORANGA TAMARIKI KAIMAHI
"Families are affected. Mum was off meth and she didn’t have support. We were going to work with her. Then the plug was pulled.” NGO LEADER
In the Bay of Plenty, rangatahi and their whānau, Oranga Tamariki kaimahi, NZ Police kaimahi and community agencies spoke with us about the positive impact of mentors. However, cuts to funding and contracts have reduced the capacity and availability of mentors.
One Oranga Tamariki site leader told us that, while Gateway assessments can be done, Gateway plans cannot be fulfilled by services in the community because of reduced funding.
"In the past, Gateway used to be good, and there was lots of money [attached to it] before. Now there is nothing, no funding attached to it. [Gateway] has got to a point of becoming a bottleneck. Even if we do an assessment, we don’t get the money, so we don’t do any assessment here.” ORANGA TAMARIKI SITE LEADER
Community providers and Oranga Tamariki kaimahi told us the impacts of funding cuts and constrained contracts on their ability to support tamariki, rangatahi and whānau and gaps in relevant service provision are ongoing.
"All the programmes got dropped in [region]. No explanations or anything just dropped, and nothing replaced them. There is this awkward silence for someone to pick up the slack … the social workers start asking is there anything else you can do because their funding [for tamariki or rangatahi] has gone.” NGO KAIMAHI
Oranga Tamariki kaimahi told us they are making referrals and “hoping for the best”.
"The effects of the loss of funding are that contracts and supports that once were there aren’t there now … I can’t just go find someone to do something that is needed … you have to go outside the box for them because services are limited.” ORANGA TAMARIKI KAIMAHI
"Cutting contracts has a huge impact and there just aren’t the services around any more.” ORANGA TAMARIKI KAIMAHI
Despite funding cuts, some providers were going above and beyond – and there was an expectation that they accept referrals
Most of the community organisations we spoke with told us that, even though their funding has been reduced and demand for their service has increased, there continues to be an expectation from Oranga Tamariki kaimahi that services are delivered.
"Funding has been cut across programmes and personnel have been cut in [Oranga Tamariki] but they still expect our kaimahi to still pick up the referrals to our services.” IWI SOCIAL SERVICE LEADER
"There have been a couple of times like – ‘can you just deliver it?’” NGO LEADER
Oranga Tamariki kaimahi and leadership in the Bay of Plenty and Te Tai Tokerau recognise the burden they are placing on community organisations by expecting them to provide services despite a loss of funding.
"Te Kooti Rangatahi [Māori Youth Court] is good but what we find it’s the difficulties in contracts that’s the issue and their trust in us is dwindling, yet we are asking for more and more [from the community] with less [funding].” ORANGA TAMARIKI REGIONAL LEADER
"A lot of our community agencies are doing it on goodwill [keeping services running, despite funding cuts] as they’ve got good relationships with the sites, but they can’t do that forever.” ORANGA TAMARIKI SITE LEADER
Social service providers told us they are doing their best to minimise the impact on tamariki, rangatahi and their whānau, but it can mean they are not getting enough support to meet their needs.
"Budgets only allowed for a certain number of counselling sessions or equine therapy sessions or family access sessions.” NGO LEADER
Some social service providers told us that, despite funding pressures, they remain focused on meeting the needs of tamariki, rangatahi and whānau and rely on strong community connections and kaupapa-based practice to offer support where possible. Oranga Tamariki kaimahi agreed.
"We have always made a commitment to whānau to look after them regardless of a drop in funding.” IWI SOCIAL SERVICE KAIMAHI
"Yeah, the cuts have had an impact. We have some services that often will be helping from the heart because there is not enough funding for the service. [The service] will continue with a young person they were helping when it was funded.” ORANGA TAMARIKI SOCIAL WORKER
Some social service providers told us they were getting “creative” to continue to meet needs of tamariki, rangatahi and their whānau. Providers also told us that continuing to absorb cost pressure is not sustainable over the longer term.
"[Oranga Tamariki] know we have wiggle room, they know that, and at some point, that will be a catastrophe.” NGO LEADER
"We definitely make sure a young person doesn’t miss out and sometimes it’s at our own expense.” NGO LEADER
We continued to hear that many organisations are going above and beyond what they are contracted for to meet tamariki, rangatahi and whānau needs.
"No government contract allows you to do what you need to do with a young person. No. Every organisation you’ll talk to, it’s going to be doing more than what the government provides in order to provide a quality service.” NGO LEADER
Funding cuts caused unintended outcomes for rangatahi in youth justice and may be pushing costs downstream
We heard about how cuts to funding for prevention services contributed to additional – and potentially avoidable – costs when reoffending occurred. We heard that some rangatahi were left in breach of their youth justice orders because services lost funding.
In Te Tai Tokerau, we heard from a whānau member that, when a court-ordered supported bail programme lost its funding, their rangatahi was left without support.
"[Rangatahi] was in a facility, and when released, he was referred to [supported bail service]. Then just one day, they didn’t show up. They just bailed [rangatahi] cos they didn’t get funding for the next round even though the judge had ordered him to be on the supported bail programme. So there were no more options, it was on me to keep him occupied. Then he reoffends again, then you get all this wraparound after he offends.” MEMBER
One kaimahi from a Māori social service said they do not have enough funding to support youth justice intervention programmes, which limits the services they can offer to rangatahi who have offended.
"Funding and resourcing [are barriers to youth justice programmes] because a lot of that [funding] stops our kaimahi being able to do more stuff for our rangatahi because of [lack of] funding. If there was better funding, there would be better opportunities. Doors would open up for [youth justice] boys.” MĀORI SOCIAL SERVICE KAIMAHI
Lost opportunities for prevention and transition support may have a longterm impact on rangatahi
We heard about lost opportunities at both ends of the system – for prevention and for transition to adulthood. As we highlighted in our 2023 Returning Home from Care report,141 returning home is a high-risk time and families need to be well supported.
"[Community organisations] can’t take on the work now. We’ve come so far and we might return children home where there is still risk and they might come back into care [because there is no longer any support for whānau].” ORANGA TAMARIKI SITE LEADER
One whānau member told us that their child was unexpectedly returned to their care due to funding cuts.
Oranga Tamariki site leaders told us that much of their work relies on community relationships and community-based contracts. They note that some whānau prefer to work with community agencies because they lack trust in government services.
Oranga Tamariki site leaders explained that community-led support can prevent tamariki and rangatahi from entering care and help address issues earlier. They also raised concerns about who will be able to continue this work in the context of funding cuts.
In January 2025, the Minister for Children told Oranga Tamariki to pause its review of social service contracts, and in April 2025, Cabinet agreed to a range of changes to its contracts in the social services sector.142 These changes included Oranga Tamariki working with the Social Investment Agency (SIA) with a view to moving funding and some services to SIA.
The true extent of loss after the Oranga Tamariki funding cuts is difficult to ascertain
Going into 2024/25, the plan for Oranga Tamariki was to reduce funding for services and supports delivered by contracted social service providers. Its mismanagement of the process meant funding reductions were much less than initially envisioned and were mainly for early intervention and prevention services.
The impacts cannot just be thought of in terms of funding and contracts. The changes in 2024/25 disrupted access to services for , and their . They also resulted in loss of expertise and resource that is likely to have long-term impacts on the social service sector.
Oranga Tamariki acknowledged deficiencies and reversed some decisions
In early 2025, Oranga Tamariki acknowledged the deficiencies in the 2024/25 contracting round and the lack of communication and engagement. Apologies were made to social sector providers. Oranga Tamariki signalled changes to come and a way forward. As part of this, Oranga Tamariki reversed some decisions about contracts that were to end in June 2025 and extended all existing contracts until 31 December 2025.
Oranga Tamariki told us that almost 200 social service providers had services discontinued over three years, some of which were due to finish. Of these providers, approximately 80 no longer have contracts with Oranga Tamariki.143
Oranga Tamariki started to make changes in response to the OAG
At the end of the 2024/25 reporting year, we were hearing about changes Oranga Tamariki was planning to respond to the OAG report and regain trust from social service providers.
Oranga Tamariki began to address issues as part of a rolling programme of improvements to its funding and contracting processes. In brief, the changes were as follows (noting that they were made after the 2024/25 reporting year).
In mid to late 2025, Oranga Tamariki:
- gave social service providers certainty about the future of their contracts, with most continuing with contracted delivery until March 2027
- held two series of regional engagement with social service providers, started providing regular communications and opportunities for providers to give feedback and established feedback loops so providers could see how their feedback was incorporated
- made changes to process payments and contract extensions and variations faster.
A new Commissioning and Investment Plan outlines future funding and contracting
During 2025, Oranga Tamariki, alongside the SIA, developed a new Commissioning and Investment Plan144 to ensure that “decisions are transparent and consider the impacts on children and the [social service] sector”. The plan responds to the OAG report and other recommendations made by external reviews.
The plan emphasises the need for decisions to be based on evidence and focused on service delivery outcomes. It outlines five priority cohorts for investment as:
- youth justice
- care population
- family group conferences
- transitioning from custody to adulthood
- targeted early risk (early support and prevention), particularly tamariki and rangatahi who have had interactions with Oranga Tamariki:
- as an infant aged under 1
- with multiple investigations and reports of concern
- with high and complex needs.
Oranga Tamariki has begun regional needs assessment
Regional needs assessment, planned for the first half of 2026, aims to summarise what tamariki, rangatahi and whānau in a region most need, combining key data with local insights.
Oranga Tamariki intends to use data, analytics and regional insights to understand who needs what, who currently gets what and where the gaps and overlaps are. It also intends to identify ineffective programmes to be discontinued.
We anticipate the regional needs assessment will consider and respond to the OAG’s finding about the need to take account of the likely impact on tamariki, rangatahi and their whānau.
Oranga Tamariki intends to have new contracts in place by early 2027
Over 2026, Oranga Tamariki will report to the Minister for Children about:
- the work with SIA for early support and prevention programmes
- regional needs assessments
- services and programmes to be continued, repurposed or decommissioned
- services and funding proposed to move to the SIA or other agencies.
- Oranga Tamariki told us it intends to have changes in place for the contracting round that will begin on 1 July 2027. At that time, it will be clearer whether Oranga Tamariki still intends to reduce its overall funding for social services as well as its intentions for the number of providers or contracts.
It is not yet clear whether funding for tamariki and rangatahi will be reduced
During 2026 and 2027 and beyond, we anticipate that there will be changes for social service providers and to the programmes they deliver. We will continue to monitor whether and how any funding is reduced. Our focus will be on monitoring the impact on tamariki, rangatahi and their whānau and whether agencies with funding and contracting roles, current or new, are meeting their responsibilities in the oranga tamariki system.
Stability for tamariki and rangatahi and their whānau during this time is critical – and any changes require a focus on their needs. We will watch whether future arrangements address this and support a strong social services sector.
135 Oranga Tamariki confirmed the number of providers and total spend in March 2026.
136 See footnote 1.
137 See (p. 6) of reference at footnote 44.
138 See (p. 8).of reference at footnote 44.
139 Controller and Auditor-General. (2025). Oranga Tamariki: Inquiry into procurement and contract management. oag.parliament.nz/2025/oranga-tamariki/docs/oranga-tamariki.pdf
140 Controller and Auditor-General. (2025). Summary – Oranga Tamariki: Inquiry into procurement and contract management. oag.parliament.nz/2025/oranga-tamariki/docs/summary.pdf
141 Aroturuki . (2023). Returning home from care: An in-depth look at the experiences and practices surrounding tamariki and rangatahi cared for at home while in state custody.
142 Oranga Tamariki. (2026, April 13). External social services and contracts funding. orangatamariki.govt.nz/about-us/informationreleases/cabinet-papers/fund-request-for-extended-social-services-and-contracts
143 These figures are approximate as there are limitations to the data. For example, providers may have changed legal entity status during the period and be counted twice.
144 Oranga Tamariki. (2026, April 10). Our approach to commissioning services. orangatamariki.govt.nz/about-us/information-releases/cabinet-papers/new-approach-to-commissioning-service-for-children-and-young-people