Either way, the government looks set to keep Climate Change Department staff located in the Nishi complex at Acton even though their department effectively disappears.

In listing changes to her front bench after last week's leadership fiasco, Ms Gillard said Climate Change would merge with the Industry Department and become known as the Department of Industry, Innovation, Climate Change, Science, Research and Tertiary Education.

Greg Combet is now the Minister for Climate Change, Industry and Innovation. His spokesman said: ''There are no plans to move climate change policy staff out of the Nishi building.''

When Ms Gillard was asked how the merger would affect public service numbers, she said it wouldn't.

The Prime Minister said that the changes, in and of themselves, would not affect the total number of public servants.

''Obviously there are people moving to take different responsibilities, but for Climate Change that has been happening for some time now.

''Obviously people who were in the absolute depths of the policy work weren't needed to keep performing that policy work once the model was struck and legislated and done.

''People who were there at the absolute height of the implementation, many of them have gone to other functions already because we are well into the implementation phase.''

The Community and Public Sector Union applauded the news, with national secretary Nadine Flood praising the government for being committed to current resourcing levels.

''We welcome the merger of the departments as it provides staff with a level of certainty at this juncture,'' Ms Flood said.

''Given that staff in the Department of Climate Change developed and implemented a ground-breaking mechanism to price carbon emissions, they have a lot of expertise to offer industry as we move towards a carbon-free economy.

''They should be welcomed into the fold by their industry and innovation colleagues and feel more secure about their futures,'' she said.

But some high-ranking public servants are not so confident that all jobs will be safe.

''It's putting two departments into one - that has got to mean fewer jobs and doing more with less,'' one contact said. ''The Prime Minister is now on the record saying numbers will stay the same, but let's see what happens behind the scenes and away from the cameras.''

Another source said ''huge amounts'' of money would now be spent changing letterheads and logos for the new department.

''And probably only for six months when Tony Abbott comes in and changes it all again,'' the contact said.

Ms Gillard said it would be ''irrational indeed'' to conclude that the new department's name meant the government had diluted its commitment to climate change.

''Anybody who thinks you can survey the names of departments and somehow come up from that survey as to what a government's policy priorities are I think is really engaged in a fool's errand,'' she said.

Greens leader Christine Milne said the government was moving closer to the opposition on environmental policies now that it did not have a minister dedicated to climate change.

But business groups said linking industry competitiveness and climate change policy was a good move. with Ross Peake