Budget leaves most agencies in holding pattern

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Most departments and agencies are in a holding pattern in this budget. Staffing levels and agency resourcing, with minor variations around the edges, are fairly static – except for Defence and Services Australia. 

The government plans to add 18,500 personnel to Defence by 2040, at a cost of $38 billion. Two-thirds of the growth will be on the military side. Civilian numbers are projected to grow by 990 ASL (average staffing level) in 2022-23 to a total of 16,991. The equivalent number for the military is ASL increasing by 2,201 to 62,063. 

Those ASL numbers are misleadingly precise. They are only estimates, and actual results will differ.

Defence in past periods of growth has found it difficult to meet recruitment targets. That is particularly so today, when unemployment in Australia is estimated to hit 3.75 (or, as the budget papers say, “the lowest level in close to 50 years”). In this jobs market, prospective recruits have numerous other options – often better paid and far less dangerous. So expect to see a lot more Defence recruitment advertising in coming years as the armed forces try to meet their staffing targets. 

The Australian Signals Directorate will almost double in size over a decade, by 1,900 staff. This is one agency that might find it easier to recruit young people – the prospect of being trained to launch offensive cyber-attacks on other countries is a real carrot for online gamers.

Meeting recruitment targets is one challenge; managing major projects is another. This budget funds a raft of new Defence infrastructure, including a new east coast submarine base, tanks, armoured vehicles, cybersecurity and other technologies. Defence capital investment rises from the current roughly $8 billion to more than $9 billion in each of the forward years. 

While there is bipartisan support for increased Defence spending, the question is whether the Defence department and Australian Defence Force can manage it effectively. Defence has a history of poor management of large and new capability projects. The government would be well advised to apply a significant proportion of the new personnel spend to building project management capacity to meet these challenges.

The increase in investment in cybersecurity is well overdue – it has been a relatively neglected capability, in a world where traditional armed conflict is now at the very least supplemented by cyber (as in the Russian invasion of Ukraine) or conceivably in future will be replaced by entirely virtual conflict.

There are other staffing increases in security-related agencies like Home Affairs, the Office of National Intelligence, and the Australian Federal Police, although nothing of the scale of the growth in Defence.

On the other hand, there are some decreases that largely offset the growth. The biggest fall in public service staffing is in Services Australia, from 28,869 to 26,150 ASL (that is, a reduction of 2,919 ASL). This reflects the completion of pandemic response measures and lower unemployment numbers, and was widely anticipated.

The net result of this and smaller ups and downs in other agencies is a negligible increase in total staffing: excluding the military and reserves, 173,558 in the coming year compared with 173,142 in the current year.  

There is, however, one urgent task for the Department of Social Services – rolling out a $250 one-off cost of living payment to pensioners and welfare recipients. That has been promised for the month of April 2022 – no easy task given Easter also falls in April, and legislation to authorise the payment still needs to be passed by the parliament. 

The budget measure for this payment lists 14 different types of eligible recipients. It specifies a person can only receive one payment even if eligible under two or more of the listed categories.

Managing a payment like this is difficult. The public servants involved (and the IT systems they use to manage payments) will need to ensure everyone eligible receives the payment, or there will be complaints; but that nobody receives a double payment, or there will be criticism.

For the four agencies responsible for this payment (the Departments of Social Services, Veterans’ Affairs, Agriculture, and Services Australia) April may yet turn out to be the cruellest month…