The private consultancy predicts the Commonwealth and states will have to find new jobs for 2500 of their workers, or make them redundant, each year as increased digitisation transforms the way governments conduct their business.

The warning comes in the wake of the call to action this week by Paul Shetler, the new chief of the federal Digital Transformation Office, who said Commonwealth departments were "failing" in their drive to be effective online service providers.

But Deloitte is upbeat about the prospects of digital government in its report Digital Government Transformation, sponsored by software giant Adobe, with the economics consultancy predicting more than $20 billion in savings could be passed on to taxpayers in the next 10 years.

But there will be a human price to pay with governments forced to find nearly $320 million to fund golden handshakes for bureaucrats displaced by the efficiencies of digital government, or take the less expensive option of retraining workers for new jobs.

The report identifies keyboard operators, call centre workers and managers, inspectors and regulatory officers, mail sorters, enquiry clerks, switchboard operators and filing and registry clerks as having good reason to be uneasy about the digital revolution.

Some Customs and Immigration officers, social security assessors and taxation inspectors might find themselves digitised out of their jobs too.

Deloitte calculates 50,000 government jobs around Australia with annual salary costs of $2.4 billion could see their workloads significantly reduced through greater digital "support".

The consultancy believes it would be realistic to see the hours of those 50,000 workers slashed in half, meaning about 25,000 could be re-deployed or made redundant, but the savings would not end there.

"These labour savings ... are not inclusive of associated capital costs related to the job such as office desk space, real estate, electricity, computers and infrastructure as well as intermediate use costs that include external labour costs," the Deloitte team wrote.

The consultancy cited the Tax Office and the Department of Human Services, both of which have been criticised in recent weeks for the quality of their online services, as organisations which have made good progress and could make further gains from digital transformation.

Deloitte calculated the cost to government of a face-to-face transaction with a customer at $16.90, by phone at $6.60, by post at $12.79 and online at a tiny $0.40.

"A digital transaction is almost 50 times cheaper than a face-to-face transaction," the report says.

"The internet has now become commonplace in everyday lives and is a preferred channel for citizens to access government services according to the Australian Government Information Management Office."

The consultancy pointed out another obvious target of digitisation; the $253 million spent each year by the Commonwealth posting about 250 million items of mail.

For the Tax Office, results could be even more dramatic with Deloitte predicting a $543 million saving each year if the Tax Office used technology to bring in 80 per cent of late tax revenues within three months of their falling due.