Oops. NSW Premier Nathan Rees has just lost Robyn Kruk, the Director-General of the Department of Premier and Cabinet, the State’s most powerful bureaucrat.

Coming in the middle of the 40-year-old Premier’s Long March towards a November 11 mini-budget to shock NSW out of its economic torpor and bureaucratic inertia, it’s a body blow.

Ms Kruk is claiming war fatigue and has told colleagues there is no longer enough energy in the tank to keep going. She leaves her $480,000-a-year job next Friday with the economy in a $1 billion blackhole. Thanks for everything.

Her sudden resignation comes 72 hours after Rees told a parliamentary estimates committee that he was outraged by the quality of advice from his bureaucrats and he was going to fire 20 per cent of them.

Ms Kruk was sitting next to him when he unloaded on the “fat cats” to an audience of MPs and the media.

Rees had asked departmental heads how they could save taxpayers’ money by doing their jobs more economically, more efficiently and smarter.

One suggested cutting public transport concessions for pensioners, another recommended cutting the program to provide spectacles for under-privileged children and a third proposed selling public football fields to developers.

All had clearly learned about how to make “economies” under the Carr and Iemma Governments, Treasurers Michael Egan and Michael Costa and Treasury mandarin John Pierce.

Kruk knows the lacklustre quality of the state’s general staff: she’s been a public servant since 1980 and knows most of them personally, and she has helped promote them to where they are now.

When Morris Iemma became health minister in April 2003, Kruk was director-general of the Health Department. They formed such a strong professional bond that after winning the March 2007 state election, Iemma brought her from NSW Health to run the newly merged Premiers and Cabinet Department.

Now there wasn’t one person out of their depth but two.

When Iemma resigned last month, Kruk lost her political ally and protector and began to feel the siege mentality of Rees and his mercurial team who are determined to have a “red hot go” at fixing the economy and public services.

The prospect of having to tell 171 senior bureaucrats that they were no longer on the payroll didn’t appeal to her. It was a $34 million saving too far.

An acting director-general will be appointed while a search is conducted in Canberra and across Australia for a replacement who has the energy and commitment to take on the basket case that is the NSW economy and its feather-bedded public service.

Peter Fray

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