The Public Service Act is being modernised, in what is being labelled as its most significant change in 30 years.
State Services Minister Chris Hipkins says the reform will help agencies work together and make bosses accountable for cross-agency failures.
Chris Hipkins told Heather du Plessis-Allan single agency responses don't work for big problems.
He says people feel like they're given the run-around by agencies, that are compartmentalised and don't communicate.
"One of the things which frustrates people and businesses is when the public sector operates in a way where its compartmentalised and siloed. People feel like they are shoved from one agency to the next."
The new law, which will be introduced to Parliament in a few months, shifts the focus of Government agencies – such as Treasury and other Ministries – and puts more emphasis on them working together.