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The job losses Tony Abbott didn’t want to tell you about

Tony Abbott’s pledge to cull 12,000 jobs from the Public Service went down well with the electorate. From the time John Howard took over as Prime Minister, and even slightly before given his pledge to trim the PS in the lead up to the 1996 election, public servant bashing has become one of the Liberal’s favourite election weapons.

There is now a perception in the community that public servants are over paid, under worked, and more importantly, not needed. Nobody seems to care if there are 12,000 less of them.

Defenders of Abbott’s decision argue that nobody will be losing their job as the 12,000 places will be vacated by natural attrition. That still means though, that there will be 12,000 less jobs to be filled from the ranks of the unemployed.

But it is worse than that. ACT and Region Chamber of Commerce and Industry chief executive Andrew Blyth explains the effect in Canberra alone:

About 4500 of the 12,000 redundancies are expected to be in Canberra, although figures are yet to be finalised and the government has said the cuts will be achieved through natural attrition.

Mr Blyth quoted ACT Government figures in his letter to Mr Abbott by stating it would cost the territory economy between $350 million and $650 million.

”A recent chamber survey found a majority of respondents believe both the ACT and national economies will be weaker over the next 12 months,” he said.

The Australia Institute has predicted a plunge into recession for Canberra and up to 5500 job losses in the city’s broader economy if planned Coalition cuts to the public service go ahead.

So that’s a further 5,500 job losses to add to the promised 4,500.

Prior to the election I suggested – and it is worth repeating given the Chamber of Commerce and Industry’s warning – that Tony Abbott’s promise to get rid of public service jobs was nothing more than a vote-winner without considering the consequences. When Howard won office in 1996 he murdered the Public Service in Canberra. The effects were devastating for our capital city which subsequently went into a recession.

But here’s the scary bit: this time, it won’t be confined to Canberra. From the CPSU website we learn that Townsville and Newcastle face the same uncertainty. In Townsville:

One in five Commonwealth public sector jobs and $87 million in wages could disappear from Townsville under a Coalition government, an analysis by the Community and Public Sector Union shows.

The CPSU analysis found 406 of the 2,015 or 21% of Commonwealth public sector jobs were at risk in Centrelink, Defence and Tax.

The CPSU based its calculations on the following:
– Tony Abbott’s policy of cutting at least 12,000 public sector jobs nationally by imposing a hiring freeze which would equate to a loss of 185 jobs in Townsville.
– Broad cuts to public spending needed to fund the Coalition’s election commitments would take another 69 jobs out of the economy.
– And a Commission of Audit to enable the outsourcing/offshoring of public sector work such as payroll, administration and IT which would see a further 152 jobs go.
– By taking the estimated salary for an APS employee of $76,821, the CPSU projects Townsville stands to lose $87 million cumulatively over three years.

CPSU National Secretary Nadine Flood said: “We have already seen what a Liberal government is doing to public services and jobs in Queensland; the last thing that Townsville needs is more cuts under a Coalition government.”

“Remember Campbell Newman promised Queenslanders they had nothing to fear from him when it came to cuts in public sector jobs and services. And then he unleashed savage cuts. “Tony Abbott says he will cut at least 12,000 jobs but those are the ones that we know about. He doesn’t want to talk about the rest because he knows that a vote for the Coalition is a vote for job cuts.”

“The community is going to be hit hard on a number of levels. If one in five jobs go that means there will be hundreds of families living in Townsville with mortgages, kids and commitments who won’t be getting a regular pay cheque.”

“The drop in staffing levels is also going to hit services which will come under increasing pressure to meet the demands of the community,” Ms Flood said.

While in Newcastle:

Nearly one in four Commonwealth public sector jobs and $132 million in wages could disappear from Newcastle and the Hunter region under a Coalition government, an analysis by the Community and Public Sector Union shows.

The full scale of the cuts across the Hunter are laid bare in a report by the CPSU which based its calculations on Coalition policies such as the imposition of hiring freezes, and the launch of a wide-ranging review into the provision of public services. The CPSU analysis found 609 of the 2,551 or almost 24% of Commonwealth public sector jobs were at risk in Centrelink, Defence and Tax, spread across the city, the Hunter Valley and Lake Macquarie.

The CPSU based its calculations on the following:

  • Tony Abbott’s policy of cutting at least 12,000 public sector jobs nationally by imposing a hiring freeze which would equate to a loss of 217 jobs in the Hunter.
  • A Commission of Audit to enable the outsourcing/offshoring of public sector work such as payroll, administration and IT which would see a further 392 jobs go.
  • By taking the estimated salary for an APS employee of $76,821, the CPSU projects the Hunter stands to lose $132 million cumulatively over three years.

CPSU National Secretary Nadine Flood said:

“The community is going to be hit on a number of levels. Over 600 jobs are to go, almost one in four Commonwealth public servants could be out of a job; that’s hundreds of families living in the Hunter with mortgages, kids and commitments who won’t be getting a regular pay cheque. By our calculations the region stands to lose $132 million in wages over three years.”

“The drop in staffing levels is also going to hit services which will come under increasing pressure to meet the demands of the community.”

The CPSU’s report follows a similar one launched in June by the Public Service Association of NSW which estimated that under NSW Premier Barry O’Farrell 1600 state public sector jobs will be lost.

Ms Flood said: “Given the depth of cuts under the O’Farrell government the last thing Newcastle needs is more cuts under Abbott.”

It says something when the Chamber of Commerce and Industry and a union agree on the same issue.

It could be even more frightening if the jobs are made redundant through the cancellation of services. While researching for a Public Service report a few years ago it was discovered that for every Public Service job lost when a program is cancelled or completed, up to three private sector jobs are at risk. Tony Abbott’s promise to cut public spending fires a warning shot that this might very well happen.

These are the job losses that Tony Abbott didn’t want to tell you about.

 

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19 comments

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  1. Chris Townley

    Michael, If John Howard murdered the Federal Public Servants, this must be a whole new batch breed under Labor. Labor was killing off Public Servants before Howard as they were before Abbott, and I think you had to be in the Labor Party to get a redundancy. My wife got me out before Howard, no redundancy, because the stress levels were getting to high. Efficiency dividends my ass.

  2. Pete A

    Abbott reckons natural attrition will achieve his aims? What’s the bet that anyone who was looking to leave will now just prop and wait for the inevitable redundancy payment.

  3. Adam Smith

    Good parliamentary governance can only ever happen when all political players understand the role civil service provides. You see, the connecting link between government and all of us is our public service. Damage the public service, mark down the integrity of people serving us in the delivery of government services, then the government by its very actions undermines its own reputation.

  4. ian

    I’m not a public servant and have never been one, though my father was.

    Only fools don’t understand the enormous contribution public servants make to a functioning, safe and free society. I doubt if any tribe, anywhere, at any time, took a conscious decision not to teach children, supply hunters with spears, manufacture implements or make storage baskets for food. They survived and prospered because the public servants made it so. The bureaucracy, even if primitive, worked. For the benefit all. Healthy, sick, disabled, injured. It worked and they survived. It strengthened them.

    I wonder if we will be strong enough

  5. Evan

    Chris Townly I took a redundancy in 1996 because I feared what Howard might do to the CPSS, I assure you that I have never belonged to any political party, so I don’t know the circumstances of your situation. Perhaps they thought you were indispensable.
    The only situation where I can recall natural attrition being used was I believe during the Fraser years and the establishment lost all their maintenance people and tea ladies became a thing of the past, not high paying jobs. Yet the coalition through Hockey say they will save $5.8 Billion for 12,000 jobs or around $200,000 per job. It all sounds like a con to me like so much of their policy costings.

  6. Colin Thai

    Ok I’m having a dream !!! It won’t be long before they will “OUTSOURCE” these jobs. Ok laugh !!! This would not surprise me with the way things are going. I cannot believe the way things are going in this country OUTSOURCING !! when I was younger the only sauce was TOMATO/SOY/CHILLI, anyway he’s going to cut jobs, and that puts more people going for the same job when it comes up, then the BOSS can dictate what you get paid. It’s a “Cunning Plan” to coin a phrase….. Thanking you. Ps shock horror Bronwyn Bishop has been named as speaker in Parliament. My god they know how to kick you when your down……

  7. fair suck of the sav

    Why didn’t Labor nail the LNP on this during the election? This is the sort of cut through message they need to hold the LNP accountable for their reckless self-serving lust for power!

  8. doctorrob54

    It’s hard to believe this Gov.has convinced so many people we have 12,000 people doing nothing in our service.With half the service providers gone people must realize what they were waiting one week to have done soon they will wait two week.Only way some people to understand what they voted for.

  9. Fed up

    Well Pete, I would.

  10. Fed up

    It was my experience when PS were cut. Many walked out the door with redundancy, only to be back, a short time later, on contract, more money to do same job, It was a good lurk.

  11. Fed up

    After years of Efficiency dividends, I cannot see much fat being there. Also, I believe many jobs now are on short contracts.

    Abbott will have to cut services.

    How he fits in all those new bodies he announced during the election campaign, is beyond me,

    Also all those 45 inquiries he is having, all mean staff, I would imagine.

    Yes, PS down, outsourcing up.

    It is a con, that will harm many good PS, for no advantage. Sounds good, like staying at the Police Academy. More costly in the long run,

  12. Fed up

    The look on the faces of Abbott sitting at the table with Defence Heads said it all. This elected PM will have little respect or help from the PS.

    One wonders how some from Treasury would feel like staying, after the abuse that Hockey had served out to them.

    It is not a prudent action to get the PS off side.

  13. bjkelly1958

    Anyone who believes that removing 12,000 employed people from the nation’s economy will not have flow on effects to other parts of the economy is severely near-sighted. As has happened here in Queensland, twice, the knock on effect to small businesses in particular can be fatal. Newman sacked 14,000 public servants, well it’s over 18,000 now and the wolf pack is out hunting again, affecting small towns and cities alike.We have nation-leading unemployment, rock bottom business confidence and all the hallmarks of a recession.

    This is the outlook for the rest of the country. I wonder if Mr Eleventy considered that all those PS employees pay tax and GST. Abbott will lead us into the “recession we could have avoided”.

  14. Mike

    The figure of a further 5,500 private sector job losses sounds a bit low. The government’s own employment multiplier is that every public sector job directly supports 1.67 private sector jobs (mainly in retail and services) and indirectly supports 0.52 others (because every private sector job also supports other private sector jobs). The effect of 4,500 public sector job losses would be more like 9,800 private sector jobs.

  15. ginckgo

    The fundamental problem with ‘natural attrition’ happens when a person retires from a position that needs to be maintained. Then they need to hire someone into that position again, and if it’s from the outside then no attrition happened; if it’s internal (redeployment from within the PS) then the position of that person needs to be evaluated to see if it needs to be maintained; and so on until a position that can be lost is vacated. It becomes very messy, prolonged and potentially costly. Believe me, we’ve done it at my (PS) workplace due to state funding cuts last year.

  16. one falung

    It’s not such a good lurk when you’re on constant 3 month contracts and having to fight tooth and nail to get money out of them.
    I’m waiting for the new and renamed Work Choices, which is bound to happen with all the talk of mandate and the LNP proxy CEO s bleating about penalty rates.Whatever it’s called it will once again prove who really runs the country with LNP as Government.
    Let’s hope the people haven’t got as short a memory as it appears.

  17. Lou G.

    Meanwhile, in the Dandenong ATO, people who should be sacked are still there exhaustively BULLYING staff to do MORE MORE MORE. They shout at people, extend their palms into people’s faces in meetings to gag them, try to MANAGE people’s unplanned leaves such as sick, compassionate and family care leaves, no matter the reason such as a parent having to be taken to hospital for cancer treatment, prostate issues, child’s dentist/doctor’s visit. They say that people need to take up doctor’s appointment after business hours !!!! This is just a short list.

  18. Anomander

    How arse about is our country when ordinary, everyday workers who do the right thing by working hard every day, providing services to the public are demonised and cast as worthless. Yet those who have the means to creatively avoid their tax obligations through lurks, scams and tax havens are lauded as heroes and valuable contributors to society.

    They haven’t even been sworn in and they are already revealed as the worst government ever. When the attacks on our rights hard-won entitlements, I hope they are prepared for the social disobedience that will follow.

  19. Ray Borradale

    Australians Over Paid – Bring Down Wages
    Please Read

    This morning on Today I heard Ross Greenwood explaining why Tony Abbott and his lawmakers needed to find the courage to bring down Australian wages following a report from international giant Price Waterhouse Coopers that Australians were the highest paid in the world; $650 per month better off than second place France.

    The average Australian might not feel that wealthy but we have to admit we do have a pretty bloody good standard of living compared to most countries around the world. And yes wages are a huge issue for small business in Australia. The fact is that most small business people aren’t remotely close to living in luxury and the eventual sale of their business, if it survives, is their retirement plan.

    In saying that; there are some holes in the arguments to reel back wages if that is the only perceived cure. In time everyone will realise, probably too late, that this PWC and Greenwood piece is just the beginning of what will be a build up of media spin to justify lawmakers bringing down wages.

    Here are some things that won’t be mentioned by mainstream media but you should consider;

    Comparing wages is irrelevant unless it takes into account the cost of living variations around the world. How well off people are should be determined by comparisons with the real VALUE of the GAP between the Cost of Living and Average Wages and the Standard of Living.

    Small business including manufacturing and farming legitimately needs help if it is to continue as Australia’s job creator and giving us at least some sense that Australia can maintain a level of self reliance. This is a critical need for all Australians however the solution is not as straight forward as targeting average Australians.

    Ross Greenwood is employed by Australian media and Australian media is mostly owned by foreign investors such as New Yorkers Goldman Sachs and Rupert Murdoch and Fairfax based in Toronto. Greenwood is a spokesperson for media representing big business and …. the coalition government’s full agenda to cement itself as a long term government on the back of appeasing the media and international banking which is international big business.

    If wages are to come down the cost of living MUST come down and that is where it gets tricky. That means that not just your incomes are reduced; there is a need to do what has not been mentioned and won’t be mentioned – the unthinkable – reduce the profits of those pushing for your wages to drop. The 1% foreign investors want average Australians to carry the entire cost of making Australia more competitive; that is, a cheaper workforce and supplier.

    These are also the financial powers that have convinced Australians that for economic reasons we have to grow our population. That way we not only become a bigger cheap workforce we also become a bigger customer for the mass produced and efficiently supplied goods that we once managed to provide for ourselves.

    Yep; the subject of bringing down wages is much more complex than I have alluded to here; consider this a teaser, and it’s much more complex than the media will tell you.

    Just be watchful and learn to be untrusting of the media and the government and opposition on all issues and we might just be able to save this country. You have a small voice but a small voice is far more powerful than you think. Personally I would like to see Australia begin to focus on self-reliance rather than willingly becoming dependent, and therefore subservient, to foreign powers.

    Do we really need them and do we really believe that foreign powers ever consider what is best for Australia and Australians?

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