How The Australian Public Service Employs People

The Australian Public Service can get workers three main ways. The first way is to bring them on as a permanent employee. They are granted all rights under the APS enterprise agreement. Permanent employees make up around 83.5% of the active roles. The second way is to hire someone as a non ongoing employee. Non ongoing are usually hired for medium tasks (6 Months - 2 Years) and Short projects (1 week - 6 Months) these ones, are normally taken off the temporary employment registers. The percentage of these people fluctuates but it's around 6.5%. The last major way is Contractors & External Labour the process for these is normally the government would put a contract out to tender. These Companies are Personal Services Companies where a person does contract work for the government. This type of employment makes up around 10%.

Now only 10% sounds like a reasonable number but that hides the true number for a few reasons one is the government may put out a tender for IT support desk services this would not be counted under contract and external labour. These outsource service providers don't count in the data and play an outsize role in the IT area. Another thing which hides the true numbers were talking about IT and external labour ICT, makes up 43% of the total spending form an audit in 2023.¹

How Much is Spent?

According to finance in the 2024-2025 financial year the government spent 3.5 billion dollars on Computer Services.² while not all of this is providing services that could be replaced with an internal team, It seems to make up a majority. As it excludes Software, Communications Devices, and Components for information technology as they are separate categories.

With this number let's assume that 500 million is spent on stuff that only one company can do. Then let's say 500 million is on true need to be contacted for specialised skills. That leaves 2.5 billion dollars which some company is taking 5-20% as profit. Let's be conservative and assume only an average 5% profit margin that's 125 Million dollars saved.

Implementation

For implementing this there are two ways I can see this being done the first way is to have an agency that can be requested to see how much a contract should go for and what they could provide. The second option would be setting up a government business enterprise with the goal of providing high quality cost effective ICT services to government agencies.

New Agency

For a new agency it would be structured like Digital Canberra but less in control. The agency would be able to do a few things which include evaluations on the competitiveness of a bid. Agencies that don't want to have their own call centers for IT problems or they need an update to their website could request the new agency to do it. This would be useful for a lot of the small agencies and give the efficiency gain from scale.

Government Enterprise

For a new Government Enterprise it would have the goal of providing high quality ICT services to the federal and state governments. It would act independent of the government and would bid on tender like any other company would. The change is that Instead of having a motive profit it would provide the service at close to cost. It would then passes the saving onto the government. This also allows for private companies to still bid on a tender and if they have a unique advantage they would win.

Takeaways

As more of everybody's lives becomes more digital the government needs to think about how it builds an internal talent pool. So it can provide a quality digital experience, without selling every Australian's arm.