The Coalition government will expand the number of private contractors answering Centrelink calls by four-fold in a move the main public sector union has labelled a "damaging and cynical" response to job cuts.
An extra 1000 private contractors will answer calls from welfare recipients in a program Human Services Minister Michael Keenan said on Monday would cut wait times, after the number of calls meeting engaged signals last year reached 55 million.
The government will hire the additional workers, based in Australia, for three years in a program ramping up the number of contractors after a trial with 250 private call centre workers from multinational Serco.
Mr Keenan could not reveal the starting date of the expansion, nor the value of the program, saying it had to be put out to tender. Fairfax Media understands it will cost the government at least $200 million.
"Our investment in these 1000 operators will greatly enhance our ability to answer more calls and ensure that the service we deliver is in line with customer expectations," Mr Keenan said.
The Community and Public Sector Union blasted the move, saying the 1000 jobs should be secure positions inside Centrelink.
CPSU national secretary Nadine Flood said its members in Centrelink had told the union Serco contractors had been used to "fudge" damning statistics showing poor phone service standards at the welfare agency.
The Department of Human Services, which oversees Centrelink, was paying call centre contractors to "click through" calls to improve its statistics, without resolving clients' problems, Ms Flood said.
"We’ve been calling loudly for years for more permanent Centrelink call centre staff to replace the more than 5000 jobs the Turnbull government has slashed in this department," she said.
"Instead the government is continuing to sell the agency off piece by piece, lining the pockets of their corporate mates like Serco rather than putting that money into wages and secure jobs for call centre workers.
"Today’s announcement is another example of what's a damaging and cynical tactic often employed by conservative politicians. The Turnbull government has cut and cut at Centrelink and is now trying to use the appalling service standards it has caused as justification for privatising a critical public service."
Serco's contract, which began in October, will cost the government $51.7 million over three years and does not include the 1000 new operators announced on Monday.
The expansion would be funded from within Human Services' existing budget, Mr Keenan said.
When asked why the government would not employ public servants to answer its calls instead, he said it didn't believe the staff would be needed long-term.
Opposition Human Services spokeswoman Linda Burney said it was "nonsense" that 1000 contract workers could clear a backlog of calls.
"Centrelink needs permanent full-time staff who are familiar with and equipped to deal with the complex circumstances facing income-support recipients," she said.
Greens senator Rachel Siewert said using a private company to reduce Centrelink call wait times created serious privacy concerns.
"It is nonsensical to use a private company when there are casual staff in the department who could be made permanent to help reduce call wait times. The private information of Australians accessing the social safety net is at risk in the hands of a private company," she said.
Lauding the Serco program as a success, Mr Keenan is again looking to the private sector, saying it "makes good business sense" for the government.
An independent evaluation of the Serco pilot found that staff were efficient and were giving the department greater flexibility around peak demand periods, he said.
The contractors had helped halve the number of busy signals, Mr Keenan said.
Centrelink call volumes are expected to decline over the next few years as the government rolls out reforms enabling most claims to be lodged and processed online, with digital assistants available to answer questions, he said.
The Coalition announced it would cut nearly 1200 Department of Human Services jobs in last year's federal budget.
Mr Keenan said no Centrelink employees would lose their jobs under the new contractor spend.