Treasurers’ debate: What major parties have planned for APS to make good on economic promises

By Melissa Coade

May 5, 2022

The Mandarin asked the treasurer and shadow treasurer to answer what their plan was for the public servants who would be executing the respective economic visions of a Labor or Liberal government. (AAP Image/Lukas Coch, Joel Carrett)

The National Press Club’s federal election debate between Josh Frydenberg and Jim Chalmers canvassed what the major parties have in store for public servants should the Coalition be restored to power, or if a new Labor government is voted into office.

The Mandarin asked the treasurer and shadow treasurer to answer what their plan was for the public servants who would be executing the respective economic visions of a Labor or Liberal government. 

Both men agreed on the high esteem they held for the nation’s bureaucrats and acknowledged the power of work public servants delivered over the last term of government. But lauding the public sector’s service delivery during a pandemic book-ended by a handful of devastating natural disasters is where Frydenberg and Chalmers’ consensus stopped. 

The treasurer singled out Services Australia, the Department of Health, and Treasury for swiftly implementing the government’s evolving COVID response in “record time”. The APS had shown “outstanding” and “professional” commitment to its work in the last term of government, he said, before cautioning a bigger bureaucratic workforce came at taxpayers’ expense. 

“I can only say from firsthand experience in the last three years how outstanding and professional public servants have been.

“I’ve only got the utmost respect for the public service,” Frydenberg said.

The treasurer also argued that APS workforce numbers had increased on the Coalition government’s watch. 

“The numbers have actually increased under us for the public service, but it’s about making sure they work most efficiently and effectively because ultimately, they are paid by the taxpayer,” he said. 

Chalmers clapped back that while it was one thing to respect and admire the public service, investing in APS capability was another thing entirely. 

“We do agree that there are first-class public servants in the Department [of Treasury] and right around the public service,” the shadow treasurer said.

“But as governments or alternative governments, we need to make sure we’re investing the right amount in their capability and their capacity.”

Last week, Labor announced its plan to rebuild the public sector workforce, outlining its intention to audit government spend on consultants and contractors and save $3 billion over four years.

“As part of [Labor’s] plan to trim spending on outsourcing in the public service, is to invest in the capacity of the public service in key areas where it’s been especially hollowed out,” Chalmers added, noting he felt Scott Morrison had missed an opportunity not to adopt all the recommendations of the 2019 Thodey Review.

“I think there are opportunities to pick up and run with some of [the Thodey] agenda. But part of that is investing responsibly in people in the public service so they can continue to deliver the high quality of services, the high quality of advice, that we need in this country and that Australians deserve for their taxpayer dollars.”

Contrary to Frydenberg’s position that APS numbers have grown, the CPSU has long contended the work of the public service has been outsourced, casualised and privatised at an increasing rate. It also claims a major cull of 12,000 jobs from the public sector by the Coalition in 2013 saw spending on outsourced workers and contractors “radically” jump. 

As recently as last February, the union told a parliamentary inquiry into the capability of the APS that the Coalition government had favoured hiring contracted employees for ICT roles, outsourcing whole government service functions like call centres to private providers, and using labour-hire to fill long-term and essential roles.

“These arrangements are the direct results of policy decisions by the coalition government, which have privileged the knowledge and skills of private companies over those of the public service and prioritised the business interests of big companies over the long-term interests of the APS, and in turn, the nation,” the union wrote in its submission

“In aggregate, these arrangements are the result of an ideological commitment to shaping government to become as close as possible to a business entity, despite its radically different obligations and purpose.”

According to the CPSU, the consequence of the Coalition’s approach to managing the shape and size of the APS has meant core responsibility and accountability for service delivery, policy and thinking has shifted to private corporations. 

The union also suggested that the recently lifted Average Staffing Level (ASL) cap, which was introduced by the Liberal and Nationals Party in the 2015-16 federal budget, gave the impression of a smaller government but diminished the capacity to meet the same enormous problems. In this way, the union contends, the ASL did not actually achieve bang for taxpayer buck. 

“Agencies are still required to deliver what the government wants and the community needs. But to do its work, the public service needs knowledge, experience, institutional foundations and a sense of shared values and ethics: the very things that are eroded by privatisation.

“This loss of experience, as well as short-term employment, restrictive industrial arrangements, and ICT constantly subjected to under-investment, have together caused enormous problems for the capability of the APS, and its ability to face today’s challenges and prepare for what comes next,” the union said. 

Wednesday’s debate about who should be trusted to navigate Australia to economic prosperity was held just one day after the Reserve Bank bumped the interest rate up to 0.35% from 0.1%. 

While the Reserve Bank boss Phillip Lowe explained the board’s decision to increase the rate was based on the healthy rate of employment and level of inflation, Australia’s four major banks quickly moved to pass on the interest hike to consumers. This has put the squeeze on interest repayments for loans and mortgages and highlighted voters’ cost of living stress on the election campaign trail. 

Answering an earlier question during the treasurers’ debate, Frydenberg offered a withering assessment of the Labor party’s economic plan, deriding the opposition’s vision as nothing but a 13-page leaflet containing old announcements and extra bureaucrats.

“The Labor party has no plan other than a 13-page brochure, which means more public servants, another review, and Bill Shorten’s old multinational tax agenda,” Frydenberg said, claiming Labor governments ‘always spent more and taxed more’.

“This is the choice: the Coalition under prime minister Scott Morrison, who’s delivered a budget, who’s held a treasury portfolio, and Anthony Albanese, who’s never delivered a budget, never held a treasury portfolio, doesn’t know what the cash rate is, doesn’t know the unemployment rate.”

Chalmers responded with a take-down of his own, labelling Frydenberg a liar on the claim Labor imposed higher taxes than the Coalition. He said it was time to call out what was a recurring ‘furphy’ the Liberal party wheeled out during election campaigns.

“​​In every way that you measure tax in the budget, this government has taxed more than the last Labor government, that’s just a fact. They’ve taxed more in total, they’ve taxed more as a share of GDP, they’ve taxed more per person, and they have taxed more, adjusted for inflation,” Chalmers said. 

“This government is the second-highest taxing government of the last 30 years, and the highest taxing was John Howard’s. So enough of this rubbish about tax,” he said. 

The shadow treasurer also acknowledged Labor was not interested in “radical” economic management but rather “responsible and meaningful change”. He said comprehensive reforms to fix the “damage done over almost a decade” could not be turned around in one budget or within the single term of a new government. 

“Australians are asking for better than this. Their government, at the same time, just promises them more of the same,” Chalmers said.

“More of the same government means more of the same punishing combination of skyrocketing costs of living and falling real wages from a government that takes credit for the good things but none of the responsibility for the difficult things.”


Chalmers’ speech holds important proposals for public sector under a Labor government

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