PINEHURST — Gov. Bev Perdue today proposed a sweeping reorganization of state government including merging state agencies, a hiring freeze for state employees, and other measures aimed at cost savings.

The governor said such steps were necessary because North Carolina faces a budget shortfall next year, which analysts now project to be $3.7 billion.

“Today, I lay out in broad strokes the picture of what I believe North Carolina’s state government must become as we change the very way state government works,” Perdue said in remarks prepared for delivery before a Chamber of Commerce group.

She said would propose to the legislature the broadest restructuring of state agencies in decades, merging 14 high level state functions into eight. Those included:

— Combining the Departments of Juvenile Justice, Corrections, and Crime Control and Public Safety into a new Department of Public Safety.

— The Department of Commerce absorbing the Employment Security Commission.

— Folding the Department of Administration into a new Department of Management and Administration that will include the Office of State Personnel, ITS and the Controller’s Office. As part of the move, 100 or more computer service facilities scattered across state government will be shut down. Also a private group will be brought in to help run the computer operation.

She said that greater emphasis will be placed on reducing duplication, such as centralizing purchasing, so that bulk purchases can be made to save money.

Perdue also plans to freeze hiring of “non-critical positions” in her cabinet agencies beginning today and will ask other state agencies that are not under her direct control to do the same.

In addition, the governor plans to send the legislature a list of 150 boards and commissions that she thinks should be reviewed and justified by the end of 2011. (There are more than 400 boards and commissions.)

“Many of them, like the Utilities Commission or the Industrial Commission, are really critical to our state’s businesses and our people,” Perdue said.

“But I believe some of them need to justify their reason for being.”

The governor said her proposals included only broad outlines and that details would be provided when she submits her budget proposal to the legislature early next year. But she said the changes “can save tens of millions of dollars immediately and trim state government rosters.”

“But those steps alone won’t be enough to set government straight,” she said.

“I’m talking at a macro level,” Perdue said. “The dramatic savings – the hundreds of millions of dollars – will be in the budget I present to the General Assembly next year. These savings will result in duplicative program elimination and cuts to middle management.”

Rob.Christensen@newsobserver.com or 919-829-4532