What’s in MYEFO for the public service? A boost for the ABS amid continued cuts

By Stephen Easton

Wednesday December 18, 2019

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The Australian Bureau of Statistics will receive an additional $40.4 million next financial year, according to the federal government’s budget update, which also indicates staffing and budget reductions will continue across the federal bureaucracy over the next few years against a backdrop of continued stagnation in the wider economy.

The Mid-Year Economic and Fiscal Outlook shows total spending on employees and superannuation in 2020-21 is expected to be $3 billion lower than in 2019-20, and only rising marginally in the following two years. The Commonwealth also expects to see a significant uptick in redundancies from July 2021, with the total cost expected to drop slightly to $54 million next financial year before jumping up to $72m in 2021-22 and $62m the year after.

Efficiency dividends are expected to give the government an extra $1.5 billion to play with over the four years to 2022-23, by scraping 2% per annum from agency budgets until July 2021, when they will go down to 1.5% under the current plan.

The $15.1 million allocated to implementing Australian Public Service reforms in line with the government’s response to the independent APS Review is split up between the Department of the Prime Minister and Cabinet and APS Commission over two years. PM&C gets $3m in the remainder of this financial year and $6.6m in 2020-21; the APSC gets $2.8m this year and another $2.6m next financial year.

The Community and Public Sector Union is particularly aggrieved to see a further $25.6m allocated to the Department of Home Affairs for its controversial plans to upgrade its visa and citizenship processing IT system over the next three years. “The measure will also allow continued engagement with the market for a strategic technology solution to ensure Australia’s visa systems remain competitive, relevant and safeguard national security,” states the MYEFO.

This takes total spending on what it calls “the government’s visa privatisation plan” to $418.9m since 2017, according to the union, which fears the project will lead to the loss of about 3000 public service jobs. “Visas are already expensive in Australia, and costs have risen rapidly in the UK in just a few years since visa processing was privatised there,” said CPSU national secretary Melissa Donnelly. “Short term budget gain will end in long term pain for the Australian community under this plan.”

Of course, the big story of MYEFO, as in other years, is the significant economic downturn it shows compared to the much rosier picture presented by Treasury in the budget itself. In general across the economy, wage growth is forecast to pick up at a slower rate than in the budget.

The CPSU unsurprisingly takes the view that the federal government’s policy of keeping public service staffing to a minimum and suppressing wage increases in its own workforce are hindering rather than helping.

“The government is missing a crucial opportunity to use the public sector to stimulate rather than suppress wages growth. With drought continuing to rage across the nation Scott Morrison has an opportunity to make a significant contribution to local communities by restoring and adding to the APS regional footprint. Creating more frontline roles in the Department of Human Services (DHS), the National Disability Insurance Agency (NDIA) the Australian Taxation Office (ATO) would improve service provision in regional locations at a time of crisis and improve local economic sustainability.”

Read more: 5 things MYEFO tells us about the economy and the nation’s finances

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