Report's recommendations are a kick in the gut to the capital

Tony Abbott has been handed the blueprint for a historic demolition job on the Australian Public Service and Canberra's economy.

Tony Shepherd's National Commission of Audit has got public service job losses, both explicit and implicit, in every line. If fully implemented, Shepherd's recommendations would result not only in a significantly smaller APS, but one that would never be the same again.

The Public Service Commission, the outfit that's supposed to hold the whole shebang together, with its ubiquitous ''One APS'' branding, would be gone, for a start.

The welfare claims of millions of Australians would be paid not but public servants but by employees of a private sector services operation.

Likewise, when a public servant makes a workers' compensation claim, they would no longer find a fellow bureaucrat on the phone, but a private operator.


That would be several thousand jobs stripped out of Canberra, and that's just for starters.

Shepherd's thoughts on tackling the PS's ''classification creep'' problem - middle managers with not enough people to manage - makes chilling reading for anybody whose livelihood is derived from the ACT's local economy.

Bringing the public service's manager-to-worker ratio into line with private sector standards, the commission of audit reckons, could allow 10,000 middle managers at APS 6, EL1 and EL2 level to be jettisoned, although the final report stops short of calling for the full implementation.

But those are the jobs, paying salaries between $75,000 and $120,000, that keep this town ticking - that pay the mortgages, the car repayments, the school fees and most importantly underpin Canberra's service sector.

Losing 5000 of them would hurt. Badly.

Then there is the bureaucracy's own service sector; the so-called ''backroom functions'' identified as hopelessly inefficient and wasteful by Shepherd's report.

In human resources, for example, the commission calculates the government spends $4700 each year per employee, twice as much as the private sector.

Shepherd wants HR, payroll, management, the whole lot, consolidated into one ''shared services'' outfit eliminating waste, duplication, inefficiency and at least a couple of thousand mostly Canberra-based public servants.

The thousands more livelihoods that would be lost in the unsurprising plan to absorb Defence Materiel back into Defence and to cut the numbers at the Russell complex back to 1998 levels would form another brick in the wall of pain Canberra is facing. And that is only the beginning of the abolitions, mergers, sell-off or reviews that Shepherd has prescribed.

There were plenty of guesstimates flying about on Thursday but the truth is nobody - not even Shepherd - knows for sure how many jobs would be gone once the dust settled from full implementation of the 86 recommendations.

Treasurer Joe Hockey has said several times that not all of the review will be adopted. We will have to wait until budget time, in 12 days, to be told what is in and what is out.

But with only half of Shepherd's plans quite sufficient to plunge families, businesses and communities in Canberra into a world of pain, we are all in for a nervous couple of weeks.


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