Mathias Cormann confirms job cuts as government agencies face axe
Coalition to cull 175 government agencies on Monday, according to reports, in addition to 76 closed down following budget
• Joe Hockey says he will announce further cuts in Myefo budget review
Finance minister Mathias Cormann and treasurer Joe Hockey have said they will announce further budget cuts on Monday as part of the mid-year economic and fiscal outlook. Photograph: Mike Bowers/The Guardian Guardian staff and agencies
Saturday 13 December 2014 14.39 AEST
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The finance minister,
Mathias Cormann, has confirmed there will be job losses across the public service amid reports the Coalition will axe 175 government agencies on Monday.
The treasurer,
Joe Hockey, will release the mid-year economic and fiscal outlook (Myefo) on Monday, and economists say it could reveal a deficit for 2014-15 of more than $35bn.
The hit list of 175 agencies is in addition to the 76 closed down following the budget, according to reports. The total of 251 abolished bodies will save $539.5m over four years,
News Corp Australia has said.
Cormann, confirmed there would be job cuts and would not rule out forced redundancies.
“We inherited a bloated public service from our predecessors,” Cormann told Sky News on Saturday. “If you reduce the number of government bodies, there will be an impact on jobs across the public service.
“What we will see is that as a result of our reform efforts so far, that the size of the public service will be back down to the same level as what it was in 2007, 2008. We think that’s appropriate.
“The goal is to ensure that the government is as big as it needs to be but as small as it can be.”
On Friday Hockey said the government faced the twin “headwinds” of iron ore prices falling to about $60 a tonne and a Senate blocking billions of dollars in budget savings.
This meant the deficit would be higher than in the May budget, when the forecast was for a $29.8bn shortfall, but the size of the rise would be “better than expected”, he said.
Hockey said the cuts would not have an impact on the economy.
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Cormann said cutting government jobs would provide some of those savings. “Part of our effort to repair the budget is to ensure that the administration and the operations of government are as efficient and as effective as possible.”
The agencies to be cut include the Australian government solicitor, with some of its staff transferred to the Attorney-General’s Department, News Corp reported.
It said the departments of health and education were named as two of the priorities for further work on streamlining the bureaucracy.
The abolition of 175 agencies would further damage the Australian economy at a time when it was already stalling, the opposition leader said.
“I think the federal government is in danger of stifling the confidence of hundreds if not thousands of jobs,”
Bill Shorten told reporters in Brisbane on Saturday.
“Australia’s at a crossroads. We are narrowly reliant on our mineral sales globally to sustain Australia – the price of our minerals is falling.
“The last thing Australia needs now if we want to have growth in the future ... is for
Tony Abbott to be killing jobs and killing confidence.”
Shorten urged the prime minister to use Monday’s Myefo to drop its “unfair measures”, including changes to university fees and cuts to pensions.
He rejected Cormann’s reasoning that the government had inherited a bloated public service.
“They’ve been in government for nearly 500 days now. When will Tony Abbott stop blaming everyone else and start accepting responsibility?”