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The Canberra Times
The Canberra Times
Ray Athwal

Costly rendundancy payout storm brewing as downsizing begins

Redundancies across the Australian Public Service have been revealed to carry a hefty price tag.

Two agencies that have embarked on voluntary redundancy rounds revealed the cost of severance payments in Senate estimates on Thursday.

The Department of Social Services will pay about $20 million to hundreds of staff who have put their hands up for a payout, officials told the community affairs committee.

Education Department secretary Tony Cook says redundancies are 'ongoing'. Picture by Gary Ramage

Opposition social services spokesperson Melissa McIntosh seized on the figure to accuse Prime Minister Anthony Albanese and Treasurer Jim Chalmers of having to pay for a "frenzied hiring binge" and hiring an extra 45,000 public servants since winning government in 2022.

"The department is going to hand out the Rolex of redundancy payouts this year," Ms McIntosh said.

"Australian taxpayers will have to foot the bill for the government's shocking bureaucracy bloat as they attempt to purge excess staff from the department."

The Education Department also revealed on Thursday that it would pay more than half a million dollars ($520,000) to shed just four staff members whose redundancies had been finalised as of March 31. That's an average $130,000 each.

Responding to questions from Liberal senator Maria Kovacic about the number of voluntary redundancies (VRs) offered in 2025-26, Education Department secretary Tony Cook said staff "can ask for VRs anytime and we make decisions about roles and functions no longer required."

"We offer VRs regularly; it is an ongoing process," Mr Cook said.

Officials also confirmed that, as of March 31, there were 88 contractors working in the department, representing 4.6 per cent of the total workforce.

Multiple other agencies are embarking on VR rounds, although last month's federal budget showed an increase in average staffing level (ASL) of 3900 across the APS since a year earlier, largely driven by a large boost to Defence to support the AUKUS program.

The average staffing level of the APS in the budget is 217,256.

Senator Gallagher has consistently said when asked about redundancies that agencies "have to manage to their budgets."

Opposition Leader Angus Taylor has declined to say how many public servants he would cut if he wins the next federal election, saying only that he wants "better government, not bigger government."

Climate Change, Energy, the Environment and Water department secretary Mike Kaiser last week confirmed that more than 200 public servants had expressed interest in taking a voluntary redundancy, after the agency opened a round.

Infrastructure secretary Jim Betts told an estimates hearing that his department had "avoided the need for voluntary redundancy rounds of the kind we're seeing in other departments," although there were a small number of "localised" VRs.

Other agencies offering voluntary redundancies include the Commonwealth Scientific and Industrial Research Organisation (CSIRO), National Indigenous Australians Agency (NIAA), Australian Bureau of Statistics (ABS) and Department of the Prime Minister and Cabinet (PM&C).

Former opposition leader Peter Dutton took a policy to the last election to reduce the APS by 41,000, which at the time would have brought it back to the 172,000 bureaucrats employed when the Coalition was last in government.

Mr Dutton struggled to explain the policy, initially claiming the reduction could be achieved through "natural attrition," but frontbencher James Paterson (at the time the opposition finance spokesperson) said it would include some redundancies.

The former policy was also, confusingly, sold as applying only to Canberra public servants, despite most APS employees being based outside of the ACT.

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