Rebuilding and rebalancing public service critical for Australia’s future

Minister for Finance, Minister for Women, Minister for the Public Service

Investments have been made in the Australian Public Service in the past two years. More staff have been employed, service standards are improving, and the reliance on external labour is decreasing – delivering much needed savings across the budget.

We have employed more permanent public servants to rebuild and improve the APS at the same time as reducing the APS’s reliance on costly external labour like consultants, contractors or labour hire workers.

Next week’s Budget will include a further saving of $1 billion from the reduction of the public service’s spending on consultants and contractors.

Together with the $3 billion in savings delivered in the 2022-23 October Budget, that brings the total savings on contractors and consultants to $4 billion.

And with our reforms, government spending this financial year on Australia’s biggest consultancies is $624 million less than the comparable period under the last year of the Morrison government.

When the Albanese government came to office in May 2022, we inherited a public service that had been hollowed out after a decade of outsourcing, underinvestment and undervaluing of the work that public servants do and the services they deliver.

The APS of 2022 was short of staff and over reliant on external labour.

Service standards were in decline and there had been serious failures in public administration like Robodebt. In one case, consultants sat on the management committee of a government department.

These problems and deficiencies across the APS did not happen by accident or overnight.

It was a conscious decision, implemented over a decade, by the former government to keep public servant jobs low whilst, at the same time, overseeing the cost blow outs that came from employing thousands of expensive non-public servants to perform public servant roles.

Hidden from view, not accountable for performance and, importantly for the then-government, not counted in the public service employee numbers.

During that time, external labour accounted for, on average, about 25 per cent of agency spending – all the while, service delivery was going backwards, as was APS wide morale.

It was certainly an expensive way to keep public servant numbers low.

When Labor came to government, problems across the service were widespread.

Policy capability was weak and, in some agencies, non-existent.

There was not enough staff at Department of Veterans Affairs, leaving veterans stranded without assistance and 41,000 compensation claims sitting unallocated.

There was not enough staff in Immigration to process visas, with a backlog of more than a million visas while business screamed out for skilled workers.

Complaints increased in the National Disability Insurance Agency as the spiralling costs of the NDIS continued without the staff needed to manage the scheme properly.

Services Australia – a critical agency for so many during the pandemic – was heavily reliant on contractors and struggling under increasing workloads.

In aged care, the regulator charged with driving quality and ensuring safety for elderly Australians had more than a quarter of their staff employed as labour hire workers.

The Department of Defence and Australian Federal Police both required additional staffing resources to make sure they could keep Australians safe.

A lot has been achieved over these past two years to rebuild a fit-for-purpose public service that is resourced to do the job the Australian people need and expect.

The entire 41-thousand-strong backlog of compensation claims at the DVA are now all allocated for processing, and we’ve bolstered the staff to ensure this remains the norm. Our veterans deserve nothing less.

More environmental approvals are being processed on time, and additional staff in Services Australia has contributed to slashing 500,000 claims from the agency’s backlog in just 10 weeks.

We’re rebuilding our sovereign defence capability to keep Australians safe in the most challenging geo-strategic circumstances we have ever faced.

And we’ve invested in integrity measures across the public service to ensure a failure like the Robodebt Scheme can never ever happen again.

There are around 8700 roles that were done by contractors or labour hire that are now being performed by public servants, including 2400 labour hire positions to be converted to secure public service roles in next week’s Budget.

Services Australia alone has seen its non-APS workforce decrease by more than two-thirds since 2022.

The actions the government is making to rebuild the public service and reduce the reliance on consultants and contractors recognise you cannot deliver outcomes for Australians without the foundations of a strong public service.

Next week’s Budget investments will be no different, with the public service set to play a key role in delivering cost-of-living relief and services across the country, laying the foundations for growth through a Future Made in Australia, and in securing the region and protecting Australians.

We are pleased with progress to date but there is more to be done to ensure that the public service is best placed to do the job the Australian people expect.

/Public Release. View in full here.