Tax Office and union agree on something: stop cutting costs
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Tax Office and union agree on something: stop cutting costs

The Australian Taxation Office and the union that represents its workers have both told the public service review cost cutting isn't helping the agency, but their positions are poles apart when it comes to contractors and labour hire workers.

In its submission, the tax office said "funding needs to be focused on ‘investment’ and transforming whole of government services rather than solely on ways to realise efficiencies and cut costs".

The Australian Tax Office and the union covering its workers have some areas of agreement in their APS Review submissions

The Australian Tax Office and the union covering its workers have some areas of agreement in their APS Review submissions

Photo: Andrew Quilty

The tax office is one of the biggest employers in the public service, with 20,000 employees. In a wide-ranging submission, the call was made for more flexibility in funding both within agencies and across the APS.

"The APS funding model should allow flexibility for different business models – reflecting the balance between economies of scale (such as shared services) and specialist functions or competitive tension," the submission said.

"Rather than a focus on effective spending of amounts allocated to individual agencies, spending against priority government outcomes and effective delivery across agencies will be increasingly important."

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The tax office also called for a review of and new base lines for agency funding to reflect future requirements.

"A specific focus needs to be given to appropriate funding of endemic and constantly evolving risks, contrasted with the funding model for one-off programs to address transient risk," the submission said.

The Australian Services Union's tax branch has echoed the sentiment on spending restrictions, saying capping salaries has had a negative effect on performance.

"The capping of salaries through successive APS bargaining policies has not led to better public service outcomes. The substitution of consultants/contractors/labour hire for FTE to maintain an artificial ASL (Average Service Level) is a false and misleading economy."

Where the union and the tax office find themselves in different columns is the use of contractors and how that contributes to flexibility, with the union asking for rigorous assessment of the purpose and value of contractors.

"We especially fear the extensive use of outsourcing arrangements in specialist areas such as IT services and technology, call centre operations and now in taxation compliance work," the union's taxation branch secretary Jeff Lapidos wrote.

The union also calls for wage rises in order to attract and keep employees in the public service, as well as limits of former public servants bidding for government contracts.

"The ASU does not want to see the development of a public service where private sector contractors are valued more than public servants. We oppose the belief that private sector experience should be more highly valued than public service in the promotional process."