The department says it doesn't track the number of contractors working on its projects, but the number of clearances sponsored by the department shows the number of contractors now dwarfs the number of public service employees at Defence.

Not all contractors and consultants need security clearances,  meaning the true number of outsourced workers is likely to be higher than the number of clearances.

In response to a question on notice, Defence said it sponsored 16,272 security clearances for non-APS staff in 2016-17, and 15,653 clearances in 2017-18. In the last financial year the department's average staffing level was 17,500, which was cut by 1127 jobs in the most recent budget. These numbers don't include uniformed members of the military.

The majority of clearances were granted to staff working for companies contracted to Defence or in the department's supply chain, which the department classes differently to contractors, consultants and service providers.

"The majority of non-APS security clearance holders are employed in defence industry. This includes contractors, consultants and service providers to Defence, and staff in companies delivering Defence contracts that require the handling of sensitive or classified information or equipment, for example companies delivering major defence capabilities," a departmental spokeswoman said.

"All contractors, consultants and service providers who require access to sensitive or classified information or equipment, or access to defence facilities, are required to have an AGSVA security clearance."

Outsourced workers have outnumbered Defence employees since at least the start of 2017, when then-secretary Dennis Richardson told staff there were up to 18,000 contractors, consultants and service providers on the books.

In his final months in the role, Mr Richardson warned the numbers of contractors needed to be curbed at the department, with the budgets available for consultants to be cut.

In 2016-17 the Australian Government Security Vetting Agency granted 46,471 clearances in total, meaning contractors to Defence made up a third of all clearances granted that year. The number of security clearances granted in 2017-18 wasn't included in the Attorney General's department's annual report.

In recent years the government has committed to spend $90 billion on new ships and submarines for the navy, with much of the work outsourced to other companies.

Labor Senator for the ACT David Smith said he put the questions to Defence because of the lack of transparency around how many contractors were working on Defence projects. In answer to a separate question asked by Senator Smith, Defence said it didn't know how many contractors were working on Defence projects, as contracts were measured in dollar terms, not in the number of people employed.

"It defies responsible contract management that you don't know what number of employees you're getting for the contracts that you've tendered out for. For me it doesn't ring true, particularly if you end up in a situation where you need to get security clearances for the people who are then conducting that work," Senator Smith said.

The Labor Senator, who until recently represented many workers in the engineering and IT fields in his role as head of Professionals Australia in the ACT.

"If these non-public servants and non-ADF members require security clearances and we're talking in Defence over 30,000 security clearances well how many of these roles would actually be more appropriate for them to be ongoing employees?"

"Particularly if you're looking at positive or negative vetting clearances you would be starting to ask yourself the question, 'if we require this level of scrutiny, should we be asking ourselves whether this is work that should be done in house rather than actually externally?'" the former union boss said.