He was less powerful but wisier as Gandalf the Grey ; as or more powerful than Saruman after his return from death. (That's how he can break his staff.) But if Saruman had won with his armies, it would not have counted.
Saruman was supposed to be the head of Gandalf's order, therefore, he was, originally, more powerful. Even though his constant staring into the palantir twisted and weakened him (in Tolkien's work, fall to evil always entails the loss of some part of one's power), Gandalf still was no match for him at the biginning of LOTR.
When Gandalf returned as Gandalf the White, he took the post and power that was originally to have been Saruman's, with a little extra something to give him the winning edge. He then easily defeated and broke Saruman, who ended up as a tortured and miserable shadow of his former self.