National Party leader Simon Bridges expects there will be changes in the system as a result of an expanded probe by the State Services Commission into the use of security firm Thompson and Clark.

Photo: RNZ / Rebekah Parsons-King

All government agencies will be scrutinised as part of an expanded probe by the State Services Commission into the use of security firm Thompson and Clark.

The initial inquiry was announced in March, by State Services Commissioner Peter Hughes, after it was revealed the firm spied on Canterbury earthquake claimants for Southern Response.

Ministry for Primary Industries said it uncovered potentially serious misconduct by some former staff members in dealings with the firm. Afterwards the Security Intelligence Service (SIS) also launched an internal investigation after evidence of its staff being unprofessional and biased towards the firm.

RNZ has been told no government agency has contracted Thompson and Clark since the Labour-led government took power but during National's term the firm was contracted by public sector services.

Mr Bridges told Morning Report the Thompson and Clark scandal was an operational matter that ministers did not have anything to do with but it was clear some of the evidence gave a bad impression.

"I think ultimately it's not for me to back, I don't have a dog in this race if you want to put it that way," Mr Bridges said.

"With all of that said, my sense of some of the email trails between the public sector and Thompson and Clark are a bad look and in some cases a really bad look."

However, he said some of the use of the firm by state services during National's time in power could be justified.

"As far as I'm concerned, there's no relationship [between the National Party and the firm] ... because ultimately I think what is true is you do need appropriate security arrangements we saw that with the Ashburton WINZ case and there was a need to be very serious about these things.

"Ultimately who is used should never be a decision for the minister of the crown, it should be an operational matter. I'm not trying in anyway to be defensive about Thompson and Clark, they mean not a lot to me," he said.

He also welcomed the inquiry and said the commission needed to investigate the issue.

"There's changes that need to come as a result of this and it seems to me that there will be and that's a very good thing."

State Services Minister Chris Hipkins told RNZ Thompson and Clark's relationships with government agencies "certainly looks like it has been inappropriate".

Last week the government announced it was moving to stop the public service's over-reliance on expensive consultants and contractors, which it said would save the taxpayer millions of dollars a year.

State Services Minister Chris Hipkins said there had been a contracting blow-out by government departments ever since the previous government put a limit on the number of full time staff.

The cap was introduced shortly after National came into power in 2008 following the global financial crisis.

However, Mr Bridges said the cap was introduced as a good "value for taxpayer money" method.

"It was very much a reaction to what we saw, and ultimately to a need for good value for money for taxpayers if you think about the nine years prior, our views is that the public sector went up by 50 percent but the outcomes did not, so we wanted to make sure we were getting good value."

He said it was difficult to be hard and fast on such matters but there was a role for contractors with appropriate expertise to be used in certain circumstances.

"The reality of contractors and infact hundreds of million were invested in engineering expertise ... around the Canterbury earthquakes and associated earthquakes. Now it seems to me that is absolutely right because you don't want to have expertise in house on the basis that you might need it on a rainy day."

"The worry here with the removal of the cap ... is that you will see a spiralling of the costs without the outcomes."