During budget estimates hearings, Mr Ferguson said treasury was currently working with agencies on implementing an efficiency dividend of 75 cents per $100.

"There have been no dollar amounts applied to agencies at this time," Mr Ferguson said.

Mr Ferguson said savings will be made by cutting back on consultants, travel and advertising.

"There will be a strong focus on minimising disruption to frontline services," he said.

Mr Ferguson said the efficiency dividend was modest compared to other states, such as Victoria and New South Wales.

"Other jurisdictions have gone to 2 to 3 per cent," he said.

Department of Health secretary Michael Pervain said the department was yet to discuss a savings target that they were working towards.

Mr Pervain said the department was undergoing targeted vacancy control to review how services could be made more efficient as part of standard, good management. There was no hiring freeze in place, he said.

When asked by Greens health spokeswoman Dr Rosalie Woodruff if he had received any advice from the Department of Health regarding pill testing, Mr Ferguson replied "I don't need it."

Dr Woodruff questioned Mr Ferguson's choice to turn down an invitation to observe a pill-testing trial at the Groovin the Moo music festival in the Australian Capital Territory.

"It's about educating people about the impact of drugs," Dr Woodruff said.

Mr Ferguson said the government had a strong position on pill testing and supporting the trial would send a mixed message.

"There's no safe use for any illicit drugs. To offer a testing service, and tell people what we think is in a drug they have brought, is problematic," Mr Ferguson said.

Mr Ferguson warned to do so would encourage a "false sense of security."

Labor leader Rebecca White questioned Mr Ferguson regarding expenditure on contractors in the health sector.

Mr Ferguson said 15 contracts were awarded in the financial year to March 31 valued at $4,666,264.

76 per cent of these were to seek infrastructure advice.

Of these 15, 10 contracts valued at $3,348,784 were awarded to Tasmanian firms.

Mr Ferguson said the government would continue to engage contractors if necessary, despite its aim to reduce their usage as part of its efficiency dividends measures.