'Frugality needed': Shadow treasurer's APS warning shot

"We think, just as Australian households and businesses have to show frugality and have to make ends meet, so too should the Commonwealth government," Mr Taylor told the National Press Club in Canberra on Wednesday.

Answering questions after his speech, the Shadow Treasurer would not be drawn on which areas of the public service a government led by Peter Dutton would trim, after criticising the Albanese government for adding 36,000 positions since winning the 2022 election.

"Now is not the time to expand government," Mr Taylor said.

"Now is the time to make sure government lives within its means ... Because, ultimately, it is households and businesses that pay the taxes that pay for those public servants."

Asked if the Coalition proposed to bring back the APS staffing cap - which resulted in the employment of thousands of external consultations when the Coalition was last in government - Mr Taylor said: "More detail on those numbers will be forthcoming".

The Shadow Treasurer affirmed the Coalition's policy that more APS jobs should be in Defence, which The Canberra Times has revealed received a boost of 6774 places in last week's budget.

He declined to answer whether, if elected, the Coalition would bring back its previous policy of moving APS jobs out of Canberra to the regions, as advocated by former Nationals leader and New England MP Barnaby Joyce.

The budget papers revealed a significant increase to the size of the public service in the next financial year, with Average Staffing Level (ASL) to grow by 12,041 places. The ASL measure differs from an overall headcount of the public service, providing an average number of full-time equivalent employees.

Mr Taylor seemed to concede that some resourcing of the APS to clear backlogs was necessary, when asked about the government's focus on clearing 500,000 Centrelink and Medicare claims and 41,000 Department of Veterans' Affairs compensation claims.

"There are areas where it is clear that the backlogs have needed to be cleared," he said.

"We were very conscious of that in government, on veterans in particular, where we upped that resourcing in the final budget because we did feel that needed to be cleared and it was an important initiative.

"We also think that it is more important that we put Canberra based, Canberra public servants, bureaucrats more generally, focused on national security ... This is all about where your priorities are."

He said the Opposition is not opposed to a fit-for-purpose public service.

"I have worked with the public service for many, many years as a minister and I know there's an enormous capability with the public service," Mr Taylor said.

Shadow Finance Minister Jane Hume also refused to rule out cutting APS jobs, while declining to say what level of ASL the Coalition thought was appropriate.

"I think that the Leader's been pretty clear that a 36,000 increase in public service seems to be excessive when you compare it to the standard of service that has been delivered," Senator Hume told The Canberra Times on Wednesday.

"Let's just put that into context. Telstra has fewer than 36,000 employees right around the country and yet 36,000 new employees are being put on here in Canberra."

Asked if a Coalition government would return to outsourcing APS jobs to keep the public service running, Senator Hume defended the approach.

"Using Consultants has been common practice within our public service for decades and under all hues of government and that's because we can't expect public servants to be experts in everything from day one," she said.

"They will continue to be used as they are being continued to be used now."

Finance Minister Katy Gallagher has criticised the Coalition for its use of external consultants while in government.

The Albanese government has brought 11,000 formerly external roles in-house since elected.