The Australian Public Service is once more bracing to feel the cold blade of funding cuts, redundancies and efficiency measures after Finance Minister Senator Mathias Cormann revealed an extensive laundry list of sell-offs, abolitions and reviews ahead of the Federal Budget.
In what ranks as one of the biggest dumps of pre-release Budget information in years, the Abbott government has vowed to push on with slimming down the size of its bureaucratic machinery by weeding out or amalgamating dozens of smaller organisations, selling off key property assets and instigating another round of reviews of Departments and agencies.
Branded as a “program of Functional and Efficiency Reviews” the savings probe is targeting major agencies “to better align” their functions and activities “with the Government’s strategic objectives and policy priorities.”
Senator Cormann is taking credit for the ‘Smaller Government Reform agenda’ extracting some $1.4 billion in savings “so far”; but the just how much the latest cuts will save over what has previously been announced will not be known until after the release of the full Budget.
The latest departments hit, as announced pre-Budget are as follows.
Department of Health:
• Cops a $106 million haircut via “efficiencies in … contractor, corporate, staff and property costs”. A large chunk of that likely to be via IT savings and the separation of the eHeath build. Around $10 million to be reinvested in the analytic capacity of the department
Department of Education and Training:
• Takes a $131 million hit “primarily from additional efficiencies across the Department”.
• $54.2 million in savings over five years from 2014-15 “through efficiencies in the administration of the portfolio” suggesting consolidation and potentially more outsourcing of Commonwealth legal work.
Department of Immigration and Border Protection:
• Savings of $168.1 million over four years from 2015-16 via “targeted departmental efficiencies” and visa simplification. Murmurs that longstanding issues with troubled ‘Systems for People’ core platform will be targeted in business process reviews.
Next on the runway
Further functional reviews of Government departments and major agencies over the “the next few weeks” include:
• The Department of Agriculture;
• The Department of the Environment;
• The Department of Foreign Affairs and Trade;
• The Department of the Treasury;
• The Attorney-General’s Department;
• The Australian Taxation Office;
• The Department of Social Services; and
• The Australian Bureau of Statistics
Sell-offs, reprieves and market testing
Having run the ruler over a swag of government enterprises for “optimal arrangements for delivery and ownership options” not everything that looked like a lucrative disposal in the National Commission of Audit has come back assessors as good value.
The Royal Australian Mint
The coin making Mint has avoided a sell-off and will stay in government hands “in its current form, because it is operating as an effective business and it is well-regarded by its international peers.” Who might buy it and for what price was always questionable.
Intra Government Communications Network (ICON)
Yet another scoping study on future ownership of Intra Government Communications Network is in train. Strong internal push-back over security implications and whether a sell-off of secure fibre will increase government telco costs. Recommendations from the scoping study later in 2015.
Australian Rail Track Corporation
It’s no secret Tony Abbott isn’t far more keen on roads than trains. Now the feds owning their own rail network is in question with a potential sell off of interstate tracks under consideration. Potential friction from Nationals amid vigorous interest from overseas operators. Recommendations to go into 2016-17 Budget process.
Australian Securities and Investments Commission (ASIC) registry services
Competitive tender process slated to test the market on the capacity of a private operator to upgrade and operate the ASIC registry, though the government says it will “maintain ownership of the base data”. Lucrative but could generate real backlash from business and Open Data supporters.
Defence Housing Australia
The fire sale that’s just too politically hot to handle. A mooted sale of DHA parked for the time being, however reviews of its “accounting, information technology and business reporting systems” instigated to “improve the transparency of the cost of providing services”.
Another unpopular sell-off option likely to bite the dust. Further consultations “with hearing impaired Australians, their families and other key stakeholders before making a decision on ownership options” for Australian Hearing.
Used Government Offices for Sale, one owner, fair condition
Cutting the size of the public service has consequences, not least for the Canberra commercial property market that has been hit hard by headcount reductions. Despite sending the market down, the government will still sell off key buildings although the Stalinesque edifices of the Finance and Treasury buildings will be retained.
While there is an intention to proceed with the with “the divestment of four properties within the parliamentary triangle” these remain subject “to the outcomes of market testing.” One building even comes with an architecturally significant restaurant.
Soon to be sold:
• East Block
• West Block
• ANZAC Park East
• ANZAC Park West (including the restaurant building).
Also up for sale is the Australian Emergency Management Institute at Mount Macedon and “additional regional properties that are surplus to requirements”
• the Aquaculture Committee;
• the Community Consultative Committee;
• the Industry Liaison Committee;
• the National Decision Making and Investment Working Group; and
• the Statutory Fishing Rights Allocation Review Panel.
• Freshwater Invertebrate Pests Subcommittee to merge with the Invasive Plants and Animals Committee.
• Administrative Review Council to be abolished, ongoing functions to be performed by the AGD.
• ABC Splash Strategic Advisory Group will be abolished.
• Defence Materiel Organisation to be consolidated into Defence Department.
• Office for Learning and Teaching Strategic Advisory Committee abolished and sent to the university sector.
• Aboriginal and Torres Strait Islander Higher Education Advisory Council to conclude 2015, “saving $1.3 million over four years from 2015-16.” Focus on Indigenous higher education to be via the PM’s Indigenous Advisory Council, other consultation and forums.
• Australian Industry and Skills Council to replace seven bodies:
Data and Performance Measurement Principal Committee;
the Workforce Development, Supply and Demand Principal Committee and “five bodies identified in the 2014-15 MYEFO for abolition”.
• Saving of $1.6 million net over five years
• ANU Section 68 Pty Ltd – following the decision of its directors to liquidate;
• the National Partnerships Implementation Working Group – following conclusion of the Smarter Schools National Partnership Agreements;
• the Teacher Education Ministerial Advisory Group – following completion of its report; and
• the Online Assessment Committee (with its functions to be performed by the Online Assessment Working Group.
• Water Act Review Expert Panel to be abolished post completion of review.
• Emissions Reduction Fund (ERF) Expert Reference Group “has ceased following completion of consultations on the establishment of the ERF.”
• River Murray Water Committee has ceased, residual functions to be performed by the River Murray Operations Committee.
• Hume Garden Estate joint venture abolished, following wind-up of the Albury Wodonga Development Corporation.
• Consolidation of corporate and legal services of Therapeutic Goods Administration into Department of Health: $106 million in savings over four years from 2015-16.
• The National Lead Clinicians Group to be abolished with residual functions conducted by the Department of Health: $17.1 million in savings over five years from 2014-15.
Immigration and Border Protection
• Office of the Migrations Agents Registration Authority consolidated into the Department of Immigration and Border Protection, saving of $1 million over four years from 2014-15.
• The OMARA Advisory Board to be replaced with a non-remunerated independent reference group, saving a further $200,000.
Industry and Science
• CSIRO Environment Strategic Advisory Committee to be abolished and functions “reallocated to a flagship advisory committee”
• IIF investments Pty Ltd will also be abolished.
• CSIRO Marine National Facility Steering Committee becomes a subcommittee under the CSIRO Board.
• Bureau of Resource and Energy Economics consolidated into the Department of Industry and Science.
• Consumer Advocacy Panel abolished.
Prime Minister and Cabinet
Six trusts dissolved via the transfer of assets to the Indigenous Real Estate Investment Trust:
• the National Indigenous Participation Trust;
• the Indigenous Investment Trust;
• the Scarborough House Office Trust;
• the Scarborough House Investment Trust;
• the National Indigenous Property; and
• the Indigenous Property Trust.
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