Right idea, wrong target: How Dutton’s 36,000 job cuts will leave him exposed

Nothing is easier in the game of politics than complaining about waste. That is why Peter Dutton is talking so much about 36,000 public servants he would like to remove if he wins power at the election. But few things are harder in government than removing genuine waste without letting it creep back under another name. So it is about time to check rhetoric against reality in the tough talk from the opposition leader.

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Dutton believes he is on a winner with voters. He has elevated Jacinta Nampijinpa Price, the Coalition’s Indigenous Australians spokeswoman, to the additional role of shadow minister for government efficiency – a job title that some call “SMOGE” to play up the parallels with what is happening in the United States. Some mock Dutton for copying Donald Trump after the president put tech billionaire Elon Musk in charge of DOGE, the Department of Government Efficiency.

But this is no joke. Dutton estimates that a Coalition government could save $6 billion a year if it removed the 36,000 workers. This turns the spending cuts into one of the decisive issues in the election ahead – and full of risk for Dutton if he commits to slashing staff. The numbers show how hard it would be for him to reduce the headcount without putting health, disability services and even tax collection at risk.

There is certainly waste in the public service. ’Twas always so. It will never change. Federal payments have risen under both sides of politics over the past decade from $406 billion to $673 billion, creating a public sector so big that dud spending is easy to hide. Even so, Dutton is setting a target he is unlikely to achieve. And voters, of course, have heard this sort of big talk before.

The core assertion from the Coalition is that Labor has added 36,000 public servants since the election. Is that true? It is a real estimate of a moving target. The Coalition makes the claim by citing the “average staffing levels” in last year’s May budget, using numbers that exclude the military and reserves. The tables show that the headcount has grown from 173,142 in June 2022 – just after the last election – and will probably reach 209,150 in June 2025. The biggest increase is meant to be in the current year, but here is a key point: this is a forecast rather than an outcome. We are only just over halfway through the year.

Labor has certainly spent a lot more on staff. Spending on public service wages and salaries was $22.8 billion in the year to June 2022, just after the Coalition left office. The Coalition forecast it would be $22.1 billion in the year to June 2024. Under Labor, it was $26.6 billion instead.

That is a red flag for anyone worried about the budget deficit. The commonwealth is weighed down by debt, due to spending by both Labor and the Liberals over many years, and federal ministers talk a lot about saving money. And Labor has increased the wages bill by 20 per cent in two years.

This gives the Coalition plenty of material to talk tough – if only its record was better. The Coalition came to power in 2013 with a sense of alarm about a budget emergency, but it kept increasing Commonwealth payments and never achieved the surplus it promised. The Senate blocked some of the savings, and then the pandemic hit, but there was another factor at work: ministers found it was much easier to talk about waste than remove it.

The Coalition scaled back the number of public service employees from 167,343 in June 2012 to 155,607 in June 2016 and 150,350 in June 2020. But it also hides the surge in spending on consultants. The employment audit in May 2023 found that the previous government hired a “shadow” workforce of 54,000 workers such as consultants and contractors.

This means Dutton and Nampijinpa Price are repeating an old formula without any sign of an actual plan. So far, they have not even proposed a spending audit – the move Tony Abbott promised more than a year before he won the 2013 election.

The Nationals leader, David Littleproud, has gone hardest. He not only complains about the 36,000 public servants but promises to get rid of them all. “The first thing we’ll do is sack those 36,000 public servants in Canberra,” he said last November. This is a promise he cannot keep.

Dutton is more careful with his words. “The 36,000 public servants in Canberra come at a cost of $6 billion per year … You could do a lot with that,” he has said. He does not pledge to remove them all, but he is clearly preparing a cut in his election costings.

The most logical Coalition policy is an “efficiency dividend” that acts like a speed limiter on a truck. The Coalition used this approach when John Howard was prime minister, and Labor did the same in 2008 with an order to departments to cut spending by 2 per cent. This works gradually and does not force mass layoffs.

There is a more drastic option, of course. Trump has sent a “buyout” offer to as many as 2.3 million US government workers to get thousands to leave by February 6 in return for a one-off payment worth about seven months’ salary. A similar approach would be horrendously expensive for a Dutton government.

(Another awkward fact is that the talk about “Canberra public servants” is at odds with reality. Only about 37 per cent of the federal public service is in the capital; another 17 per cent are in NSW, 17 per cent in Victoria and 13 per cent in Queensland. If all the cuts fell on Canberra, the city’s federal workforce would be almost halved.)

Dutton is not talking about cuts to Defence. This is impossible when he presents himself as the strong man of Australian politics. Even so, many of the 209,150 workers identified by the Coalition – the number it relies on to claim the 36,000 increase – are in defence and security. There are 16,299 across the Attorney-General’s portfolio including the Australian Federal Police. There are 19,131 civilians in Defence, 8406 in the Department of Foreign Affairs and Trade, and 15,590 in Home Affairs.

There are also 3188 in the Department of Veterans Affairs – a key point when the Coalition tended to make it harder for returning soldiers to get help. My colleague Shane Wright outlined this scandal last year.

That leaves about 146,000 workers in other departments and agencies. Who would be cut? The target of 36,000 jobs would require the Coalition to sack one in every four workers from that remaining total. This is impossible without cutting some of the biggest departments and agencies. Getting rid of smaller ones – such as 4700 people at the Department of Climate Change – would barely make a dent in the target.

Dutton would have to target the 30,236 workers at Services Australia, the 21,350 at the Australian Tax Office and the 8069 at the National Disability Insurance Agency. The Liberals and Nationals may not mind if a welfare recipient waits for hours on a helpline, but they will hear about if farmers do not get assistance or business owners have more trouble with the ATO.

Many voters will rally to Dutton’s cause because they want the waste to end. And there is certainly some waste there. The problem for Dutton is that his big talk sets a goal he cannot reach. And the bigger his goal, the more vulnerable he is to a Labor campaign that paints him as a threat to essential services.

The bigger his target, the more he becomes one himself.

David Crowe is chief political correspondent.