Right for the job? ATO spend on external recruitment contractors reaches $6m

Right for the job? ATO spend on external recruitment contractors reaches $6m

The Tax Office has outsourced its hunt for new employees to the tune of $6 million last year despite complaints that external recruitment companies lack knowledge to hire the right staff.

New figures show while an upswing in Australian Taxation Office recruiting followed the end of the Abbott-era APS hiring freeze in 2015, the agency paid outsiders to find one-third or more than 1000 of its new workers the next year.

The ATO has increased its spend on external recruitment companies.

The ATO has increased its spend on external recruitment companies.Credit:Tamara Voninski

The ATO spent $6.1 million in 2016 on recruitment agencies contracted to find staff, up on its $2 million spend the previous year and $700,000 in 2014 as it held back under the Coalition hiring crackdown.

But the agency says after it filled critical vacancies last year, it expected recruitment costs to fall significantly in 2017.


Of new employees found by external agencies, more than 750 were recruited into general roles, 290 to specialist positions, while the ATO outsourced its hiring of two executives to contractors.

An ATO workplace union said a government-imposed cap on staff numbers was stopping the agency from keeping recruitment in-house.

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Australian Services Union official Jeff Lapidos said it received a steady stream of complaints that external recruiters didn't know enough about the Tax Office's work.

"That means they have trouble assessing applications because of a lack of knowledge about what's involved with the work," he said.

External providers were instead biased towards applicants using "base phrases" or language favoured in recruitment.

"As long as they use the right buzz phrase, they tend to get selected," Mr Lapidos said.

The $6 million spend on contractors would be better directed to ATO staffing which could let the agency conduct recruiting itself, he said.

"I think we would get better results, people who are more suitable to the job."

The Tax Office said there were significantly higher levels of recruitment across the agency during 2016 to support the Tax Avoidance Taskforce, tax time and fill other critical roles.

"The ATO engages external suppliers to deliver an extensive range of recruitment services that support maintaining a professional and productive workforce across the country."

Labor member for Fenner Andrew Leigh said it was absurd the Coalition would slash more than 3000 jobs from the Tax Office, only to pay recruitment services to then hire staff.

"Not only did the cuts cost taxpayers money, it now seems that the ATO had to spend millions to get workers back in the door," he said.

The ATO is looking to enter into another contract with external recruiters after its five-year arrangement with present providers finishes in October, and wants to attract employees with a "quality client and candidate experience" as demand for new talent rises, particularly specialist staff.

While the ATO says most of its hiring is managed in-house and it only uses external suppliers when required, it wants to use recruitment companies to source and assess candidates, recruit employees, headhunt, provide detailed intelligence on applicants and design campaigns.

The government announced it would grow the Tax Office's ranks by 142 staff to 18,043 in this year's budget.

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Doug Dingwall is a reporter for The Canberra Times covering the public service and politics.

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