Shared Services Centre to boom as Australian Public Service outsources

The Australian Public Service's fledgling Shared Services Centre looks set to boom from the Abbott government's "contestability" outsourcing push.

But already there are warnings that public servants across the bureaucracy might be planning resistance to a takeover of their turf.

The centre already has 600 public servants, making it bigger than some departments, and has taken over "backroom functions" from 11 departments and agencies.

But the government's "contestability" agenda will force public service bosses to consider the shared service model when assessing what work can be outsourced or privatised.

The Shared Services Centre, which emerged from the break-up of the education and employment departments in 2013 and has only been operating since early 2014, is a key plank in the government's "contestability program", which may see tens of thousands of Commonwealth jobs outsourced.


One public sector expert has warned the program is the beginning of a "slow bleed" of the federal bureaucracy that could ultimately see more than 30,000 government jobs lost in the coming years.

The Finance Department has confirmed that "portfolio stocktakes" are under way with government departments being assessed to see if their work can be farmed out to either the private sector or the Shared Services Centre.

But there may be resistance in the ranks with former public service commissioner Stephen Sedgwick recently warning that back-office teams across the bureaucracy might still "silently harbour the hope that they can convince their management that their circumstances are sufficiently singular that standardisation is not for them".

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The centre is doing work for at least 13 departments and agencies, on a fee-for-service basis, including the Prime Minister and Cabinet, Social Services, Employment and Mr Sedgwick's old agency, the Public Service Commission.

As part of the contestability drive, departments are being encouraged to consider follow the example of the commission, which has farmed out its finance and human resources systems to the centre.

"The [Public Service Commission]'s leave approval, credit card and travel approval processes are now integrated in a single software solution with enhanced controls that make better management possible," according to a "case study" spruiking the centre's credentials.

But the commission conceded it had to accept the "trade-off" of some of its unique customisation.

"However, further benefits from the shared services arrangements will be realised by the [Public Servic Commission] when access is made to the wider range of systems and processes available through Connect and the [Share Services Centre's] information network."

The centre did not respond to requests for comment on Wednesday.

The shared services concept has been in and out of fashion in the public service, as different management theories have held sway over the decades.

But the formula was considered dead and buried when the Howard government abolished the much-maligned Department of Administrative Services in 1997.

The Attorney-General's Department has also recently emerged as an unlikely shared services player after taking over backroom operations for most of Canberra's cultural institutions and is widely expected to swallow up the Commonwealth review tribunals' human resources functions in mid-2015.


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