The federal government has welcomed the closure of two more Commonwealth shopfronts in Canberra, saying the move will enable the creation of a "one-stop-shop" for government services in the city's south.
But the closure of a Medicare shopfront in Woden Plaza will be a blow for the shopping centre already struggling with the exodus of public servants and retailers from the area.
The Australian Taxation Office's move of its shopfront from Civic to Woden will leave yet more empty federal government office space lying idle in the CBD, with nearly a year left to run on the lease.
Medicare, Centrelink and the ATO will all move into the one shopfront at Penrhyn House on Bowes Street in Woden with the "one-stop-shop" to start operating December 15.
Minister for Human Services Marise Payne said the co-location model, begun under the previous Labor government, reflected slowing demand for face-to-face government services
"Demand for face-to-face services is decreasing nationwide, as people take advantage of other options like claiming at the doctor's surgery, the department's suite of Express Plus apps and myGov for online services," Senator Payne said on Wednesday.
Liberal Senator ACT Zed Seselja welcomed the new arrangement.
"The Woden One-stop Shop is the latest in Canberra to offer combined government services under the one roof, joining more than 160 communities nationwide," Senator Seselja said.
"It is a practical example of making government services more accessible to all Australians."
Woden Plaza has been suffering from the departure of thousands of public servants from the area with hundreds more, as well as 400 ACT government, scheduled to leave in the coming years.
The announcement in August that work was due to begin on several projects for the revamp of the battling town centre, including the overdue construction of a bus interchange, was a rare piece of good news for the town centre this year.
The owners of Canberra's tallest building, Lovett Tower, are looking for a developer to turn the once thriving public service hub into retirement units once its last bureaucrat leaves their desk in 2016.
The owners of the massive boarded-up Alexander and Albemarle buildings had intended to redevelop the landmark office blocks but have put any plans on hold, fearing Woden's office market will be soft for the foreseeable future.
The Department of Human Services, which runs Centrelink and Medicare, did not respond to questions before deadline on Wednesday.
But an ATO spokesman said there would be no job losses in the move to Woden from Ethos House, but he said the lease at the Civic site would not expire until November 2015.
"The same ATO services will be offered in the new location," he said.
"There will be no change. Customers will have an improved service as they will be able to access ATO and Department of Human Services in the one location.
"All staff will relocate to the new location.
"Staff have been consulted in accordance with the ATO Enterprise Agreement 2011.
"The lease on the existing site expires in November 2015; the ATO are actively seeking other agencies to occupy the space until then."