New QLD Treasurer Cameron Dick to pause bureaucracy blowout

Queensland’s new Treasurer will find $3bn in cuts by slashing spending on consultants and putting a lid on non-frontline bureaucracy growth.

Queensland Treasurer Cameron Dick. Picture Annette Dew

Queensland’s new Treasurer, Cameron Dick, will put a lid on the state’s public service growth and slash spending on consultants to find $3bn in budget savings over four years.

The state’s bureaucracy has grown by more than 28,000 full-time equivalent workers since the Palaszczuk government was elected in 2015, after one-term Liberal National Party premier Campbell Newman cut 14,000 FTEs from the public service. The wage bill is now $7.1bn a year higher.

On Thursday Mr Dick will announce he has found $3bn in savings over the forward estimates, without cutting frontline services, sacking public servants or selling publicly owned state assets.

He said along with the $500m public service wage pause, the size of the bureaucracy would stay the same for 12 months, excluding frontline services. “Measures include … internal recruitment only to fill non-frontline roles for 12 months, (we will) stop secondment of frontline staff to non-frontline roles, (and) reduce the use of external consultancies and contractors by government with a view to ending arrangements where possible,” he said.

Queensland was forecast to spend $25.4bn, or 42.2 per cent of its expenses, on public service employees in 2019-20, $1.3bn or 5.4 per cent higher than the year before. In 2019-20, 4400 more full-time public servants were expected to be hired, 89 per cent in health and education, bringing the size of the public service to 233,637 workers.

The budget papers estimate 91.4 per cent of public servants were frontline or frontline support as at March 2019.

Mr Dick’s announcement is a major economic statement, ahead of his delivery of an economic and fiscal update in September. The government has ruled out delivering a full budget before the state election on October 31, blaming coronavirus for making economic forecasting impossible.

“In this difficult economic environment, all decisions will be guided by these key priorities: creating jobs, building essential infrastructure, and delivering frontline services,” Mr Dick said on Wednesday night.

It is not clear what the size of the state’s bureaucracy actually is, as the latest public service data has not been released. The updated figures from the end of last year have not been published and are months overdue.

Mr Dick replaced former treasurer and deputy premier Jackie Trad in May after she resigned from cabinet while under investigation by the Crime and Corruption Commission. The corruption watchdog has announced it will not press charges against her, but Premier Annastacia Palaszczuk says she will not return to cabinet before the October poll.

Last month, Mr Dick said the coronavirus pandemic had delivered a “hammer blow” to the state’s economy that would take years and not months to recover from. He said Queensland had taken a nearly $20bn hit from the first wave of COVID-19, and any second wave would be a $4.8bn knock to the state.

In the past two months, 168,000 Queenslanders have lost their jobs.

At the 2019 budget, Ms Trad announced the creation of a public service razor gang, the Service Priority Review Office, to find $1.7bn in cuts over four years: $200m in 2019-20 and $500m each year after that, focusing on slashing spending on consultants.

It over-performed, finding $715m in savings in 2019-20.

Ms Trad embedded PwC consultant Nicole Scurrah, former premier Anna Bligh’s chief of staff, in the razor gang, drawing criticism that a consultant was advising on cutting spending on consultants.

Mr Dick has since axed all external consultancies attached to the SPRO — which had a $10m budget over two years — and brought the work back in-house in Treasury.

He also has cancelled plans to hire a chief economist from outside the government. He instead promoted senior Treasury bureaucrat Dennis Molloy.