Defence workforce

Budget Review 2010-11 Index

Budget 2010–11: Defence

Workforce

David Watt

This year’s Budget has engendered some comment by both journalists and the Opposition on the increase in the number of civilian Australian Public Service (APS) staff in the Department of Defence. In his response to the Budget, Shadow Treasurer Joe Hockey stated that the Budget would deliver ‘more bureaucrats and less to the front line, increasing civilian numbers by 1500 and cutting the number of uniform personnel by 500’.[1] The media also commented on this change in staffing numbers.[2]

The following data is derived from the staff numbers outlined in Budget Strategy and Outlook: Budget Paper No. 1: 2010–11:[3]

Table 1: Average Staffing Levels

The Department’s explanation for the rise in the number of APS staff is that, based on ‘the detailed diagnostic program completed as part of the Strategic Reform Program’, the new number is a more realistic appraisal of Defence needs over the coming years.[4] More specifically, the Defence Portfolio Budget Statements 2010–11 (PBS) state:

The increase in the civilian APS is due to increases associated with the White paper, civilianisation of military positions and conversion of contractor positions associated with the Strategic Reform Program and delays in recruitment resulting in a lower budget forecast outcome for 2009–10.[5]

The conversion of contractor positions to APS positions and the civilianisation of positions held by uniformed staff was flagged in the 2009 Defence White Paper:

Government has also directed Defence to substantially reform the workforce to drive productivity improvements, based on three initiatives: a leaner, more effective business support model; a largely civilianised and professionalised non-deployable military workforce; and the conversion of contractor positions to less expensive full-time civilian positions. [6]

The White Paper went on to say that these measures, coupled with consolidation and centralisation of services, would lead to substantial savings in the Defence Budget. However, it also noted that the process initiated by the White Paper would see a net growth in the number of APS staff employed in the Department of Defence.[7]

The publicly released documents which describe the Strategic Reform Program (SRP) have attempted to quantify the changes on two occasions. Released in late 2009, The Strategic Reform Program: Delivering Force 2030 had this to say:

While there will be increases to the APS workforce through civilianisation, contractor conversions and new White Paper initiatives, there will also be reductions in creating a leaner business model and an ongoing improvement dividend. Based on initial analysis, civilian numbers will grow overall by the total civilian workforce of between 50 and 300 in any one year. These reductions equate to between 0.2 per cent and 1.2 per cent of the total civilian workforce. [8]

By the time of The Strategic Reform Program: Making it Happen released in early 2010, the numbers had been revised somewhat:

As a result of previously planned growth and White Paper initiatives there will be a net growth of around 3,800 ADF positions and 1,500 APS positions to 2018-19. This is a larger number of positions than previously advised in the booklet ‘Strategic Reform Program: Delivering Force 2030’. The implementation planning phase of the SRP did not produce the same level of reductions in shared services, civilianisations or contractor conversions as predicted in the Defence Budget Audit.[9]

It should be noted that uniformed military personnel and contractors both cost the Department of Defence considerably more than do equivalent APS staff. The SRP documentation states that contractors cost between 15 and 40 per cent more than their APS equivalents and that it is hoped that the planned reductions in contractors will produce savings of around $400 million by 2018–19.[10]

It also claims that between 500 and 600 uniformed military support positions will be civilianised between 2010 and 2014. Since APS employees cost on average 30 per cent less than their ADF counterparts it is hoped that this will result in a cost reduction of around $400 million over the life of the program.[11] Defence states that there are approximately 11 000 military personnel in support positions across the ADF but that civilianisation will only affect a maximum of about 10 per cent of these positions.

The Strategic Reform Program: Making it Happen booklet contains a table which sets out the projected workforce implications of the SRP and the White Paper. The table includes data on intended numbers of both civilianisations and contractor conversions out to 2018–19.[12] The relevant figures for 2010–11 project an increase of 244 in the number of APS staff as a result of conversions and that civilianisation will result in a further 188 additional staff.  The table also estimates that during 2010–11 there will be an increase of 1375 APS staff as a result of the White Paper implementation process. Allowing for some SRP efficiency-based reductions and the fact that the reduction in the number of contractors employed is exactly equal to the number of APS personnel employed to carry out the same roles (albeit the APS staff cost less) these figures seem to be the basis of the projected Budget increase of 1470.

The Portfolio Budget Statement for Defence does not comment on the reduction of 101 in the Average Staffing Level for Defence Housing Australia (DHA). However, the announcement by the Minister for Defence Personnel, Materiel and Science in November 2009 that DHA had lost the contract for removal and relocation services to Toll Transport Pty Ltd could, in part, be responsible for the lower number. The PBS states that this contract resulted in direct revenue to DHA of $19 million during 2009–10. The loss of this money would presumably have an impact on staff numbers.[13]

[1].    J Hockey (Shadow Treasurer), A shameless con, media release, 12 May 2010, viewed 17 May  2010, http://parlinfo.aph.gov.au/parlInfo/search/display/display.w3p;query=Id%3A%22media%2Fpressrel%2FDPOW6%22

[2].    See for example: B  Nicholson, ‘Afghanistan Soldiers, Veterans given priority’, The Australian, 12 May 2010, p. 9, viewed 17 May  2010, http://parlinfo.aph.gov.au/parlInfo/search/display/display.w3p;query=Id%3A%22media%2Fpressclp%2F44OW6%22 ; S Bartos, ‘Changes are coming but not in this budget’, Canberra Times, 12 May 2010, p. 16, viewed 17 May 2010, http://parlinfo.aph.gov.au/parlInfo/search/display/display.w3p;query=Id%3A%22media%2Fpressclp%2F9HOW6%22

[3].    Australian Government, Budget strategy and outlook: budget paper no. 1: 2010–11, Commonwealth of Australia, Canberra, 2010, Table C5, p. 6–68, viewed 17 May 2010, http://www.aph.gov.au/budget/2010-11/content/bp1/html/bp1_bst6-06.htm

[4].    Australian Government, Portfolio budget statements 2010–11: budget related paper no. 1.5A & 1.5C: Defence Portfolio, Commonwealth of Australia, Canberra, 2010, p. 30, viewed 17 May 2010, http://www.defence.gov.au/budget/10-11/pbs/index.htm

[5].    ibid., p. 31.

[6].    Department of Defence, Defending Australia in the Asia Pacific Century: Force 2030, Department of Defence, Canberra, 2009, p. 118, viewed 14 May 2010, http://www.defence.gov.au/whitepaper/docs/defence_white_paper_2009.pdf

[7].    ibid., p. 123.

[8].    Department of Defence, Strategic Reform Program: delivering Force 2030, Department of Defence, Canberra, 2009, p. 20, viewed 17 May 2010, http://www.defence.gov.au/publications/reformbooklet.pdf

[9].    Department of Defence, Strategic Reform Program: making it happen, Department of Defence, Canberra, 2010, p. 18, viewed 17 May 2010, http://www.defence.gov.au/srp/docs/srp.pdf

[10]. Department of Defence, SRP initiative information sheet: workforce and shared services: contractor conversions, 6 April 2010, viewed 17 May 2010, http://www.defence.gov.au/srp/infosheets.htm

[11]. Department of Defence, SRP initiative information sheet: workforce and shared services: civilianisation of ADF support positions, 6 April 2010, viewed 17 May 2010, http://www.defence.gov.au/srp/infosheets.htm

[12]. Department of Defence, Strategic Reform Program: making it happen, op. cit., p. 29.

[13]. Australian Government, Portfolio budget statements 2010–11: budget related paper no. 1.5A & 1.5C: Defence Portfolio, op. cit., p. 209.