National Secretary of The Community and Public Sector Union, Nadine Flood.

National Secretary of The Community and Public Sector Union, Nadine Flood. Photo: Rohan Thomson

A crisis meeting of the public sector union is extending the suspension of its election campaign support of the Labor Party in protest at the federal government's plans to cut another $1.8 billion from the public service.

The Community and Public Sector Union (CPSU) is calling for an urgent meeting with the government about the decision to increase the ''efficiency dividend'' from 1.25 per cent to 2.25 per cent, which it estimates will cost up to 5000 jobs and cause huge delays and backlogs in government services for millions of Australians.

As part of last Friday's mini-budget, the government is imposing the cuts in the form of the dramatically increased public service efficiency dividend from next July.

The ''temporary'' three-year increase to the dividend was unveiled as the government grapples with a $33 billion drop in projected revenue for the next four years.

Finance Minister Penny Wong said she expected an extra $1.8 billion in savings from the increased dividend.

The public service is expected to rip out $600 million a year from its budget for three years without forced redundancies, according to the federal government. Union national secretary Nadine Flood said the cuts were a blow for public sector workers already struggling with the impact of previous cutbacks and job losses.

''We are seeking a clear commitment from the highest levels of government about supporting public sector jobs and services, and a better decision than an across-the-board efficiency dividend cut,'' she said on Monday.

''We understand that times are tough, but you only have to walk into a Centrelink office to know the queues are already long enough.

''To secure the support of public sector workers, Labor needs strong policies that demonstrate how different they are to the Liberals when it comes to public sector jobs and services.

''We know Tony Abbott will cut 12,000 to 20,000 public sector jobs, but public sector workers expect something different and better from Kevin Rudd.

''If any other industry announced it was cutting thousands of jobs, there would be a national outcry.

''Public sector workers are real people, too, with families, mortgages and bills.''

Over the past few months, hundreds of CPSU delegates and staff have been working with the ACTU and ALP candidates to make thousands of calls in marginal seats, co-ordinating local election action, and getting the union's ''Cuts Hurt'' campaign message out to tens of thousands of public-sector workers.

Meanwhile, a think tank warns the federal government's cuts to the public service are reducing productivity and stifling innovation.

The report - Death by a Thousand Cuts - from the Centre for Policy Development says rising expectations of public services cannot be met in the face of ''blind, across-the-board cuts''.

The authors examine recent cuts in the federal and West Australian public sectors, and highlight what they say are long-term problems resulting for the Commonwealth, WA, and other states and territories.

The paper says undesired consequences of indiscriminate cuts include:

■ Loss of workforce knowledge and skills.

■ Loss of productivity and innovation, due to reduced engagement, lack of resources and time.

■ Loss of trust and confidence in public sector institutions.

''Many governments in Australia and internationally are choosing to 'avoid responsibility' for service shortfalls when making budget savings, by applying across-the-board cuts rather than identifying the services which should be reduced or ceased,'' the authors say.

''The report argues that ineffective services and less engaged public servants can lower the popularity of the government in power, hamper the enforcement of laws and regulations, and reduce popular engagement with the democratic process.''

Co-author Kathy MacDermott says while staff engagement is a key factor in raising productivity, that engagement is eroded by government rhetoric that denigrates the public sector in an attempt to justify cuts.

Research director Christopher Stone says the cuts ''will backfire''.

■ The publication was funded by the Community and Public Sector Union and the Civil Service Association of Western Australia.