Public service review targets 2,500 contractor positions for conversion to APS roles

The Australian Public Service Commission has announced the conversion of 2,500 contractor and labour hire positions to ongoing APS employment as part of the government's commitment to rebuild the public service workforce capability that was contracted out during the previous administration's pursuit of a smaller public service headcount. The conversions will be phased across 18 months and will affect agencies including the Department of Finance, Services Australia, the ATO, and the Department of Home Affairs.

APS Commissioner Gordon de Brouwer said the conversion program reflected the government's recognition that the excessive use of contractors for core public service functions had created capability gaps, reduced institutional knowledge, and resulted in higher long-term costs than the equivalent APS workforce would have incurred, due to the management overhead and premium rates associated with professional services labour hire.

The announcement will have a direct economic effect on Canberra's labour market, as the conversion of contractors — who may currently be employed by firms based in Sydney, Melbourne, or offshore — to Canberra-based APS employees will increase the proportion of the APS expenditure that flows through the ACT economy as wages and household spending.

The professional services firms that have been providing the contractor workforce across the affected agencies have been briefed on the conversion timeline and have indicated they will work cooperatively with the agency transition teams to ensure continuity of service delivery during the changeover period.

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