20 June 2017

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Philip Hamilton and Simon Speldewinde
Politics and Public Administration Section

The 2016–17 Budget, in a novel development for the Efficiency Dividend, provided that $500 million of projected savings would be reinvested in reforms ‘such as automation of public services and business re-engineering’. In 2016–17, funding was included in the forward estimates but without detail on specific initiatives.[1]

The vehicle for reinvestment is the Public Service Modernisation Fund (PSMF). The PSMF appeared for the first time in the 2016–17 Mid-Year Economic and Fiscal Outlook (MYEFO), with the provision of $20.4 million over five years to the Australian War Memorial and the National Library of Australia.[2]

The 2017–18 Budget outlines how, through two cross-portfolio budget measures, the PSMF will fund a number of initiatives expected to ‘deliver quality government services at lower cost and use leading technology and collaborative approaches to address complex problems facing society’.[3]

• Funding of $350.0 million over three years from 2017–18 is appropriated for a ‘transformation and innovation’ measure, which comprises better use of data within government; streamlining and improving user access to government services; strengthening APS workforce capability; and more efficient corporate services.
• Funding of $150.0 million over three years from 2017–18 is appropriated for an ‘agency sustainability’ measure, which aims to support ‘a number of agencies [in] their transition to more modern and sustainable operating models’.[4]

Details of specific PSMF expenditures are dispersed across portfolio budget statements. This quick guide consolidates the PSMF initiatives, listing them by portfolio and entity in a single table with links to relevant sources. For clarity those portfolios not currently slated to receive funding have been included in the table. 

Abbreviations and acronyms

Table: Public Service Modernisation Fund initiatives listed by portfolio and entity

[1].     Australian Government, Budget measures: budget paper no. 2: 2016–17, p. 71.

[2].     S Morrison (Treasurer) and M Cormann (Minister for Finance), Mid-year economic and fiscal outlook 2016–17, p. 140.

[3].     Australian Government, Agency resourcing: budget paper no. 4: 2017–18, p. 2. For more information about the four initiatives, see P Hamilton, ‘Public sector ICT’, Budget review 2017–18, Research paper series, 2016–17, Parliamentary Library, Canberra, 2017.

[4].     Agency resourcing: budget paper no. 4: 2017–18, pp. 2–3. There is an apparent discrepancy in that the agency sustainability figure is reported as $129.6 million in Australian Government, Agency measures: budget paper no. 2: 2017–18, pp. 75–76. As shown in this quick guide, the apparent discrepancy may be due to information that is ‘not for publication’ or is for other reasons not disclosed in the 2017–18 portfolio budget statements.

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