Submission to Inquiry by Senate Select Committee into Certain Aspects of Queensland Government Administration related to Commonwealth Government Affairs
1. The Select Committee was established to inquire into and report on a range of issues pertaining to aspects of Queensland Government administration relating to Commonwealth Government affairs including “any other matter the committee considers relevant”.1 It is submitted that as part of its work it would be reasonable for the Select Committee to inquire into the following matter.
2. In 2013 the Education, Employment and Workplace Relations References Committee of the Australian Senate reported on its inquiry into “Conditions of Employment of State Public Sector Employees”. The Committee had received submissions from many people who had been adversely affected by the Newman LNP Government’s decision in 2012 to cut the jobs of thousands of Queensland government workers (including those holding temporary and permanent positions). The majority report of the Committee, while supporting the managerial prerogative of State governments to make decisions pertaining to their respective public sector workforces,2 concluded:
Public sector reform is a contentious issue. The committee understands that staffing reductions and voluntary redundancies can have a significant impact on the individual workers affected, as well as families and communities. The committee trusts that state governments do not make these decisions lightly, and carefully consider the consequences of such reforms.3
3. It is submitted that the Newman Government’s decision to cut thousands of public sector jobs was highly ill-considered given the devastating consequences it had not only for the individuals concerned and their families but also for the whole Queensland economy. Therefore, it is reasonable for the Select Committee, under section 1(g) of its terms of reference, to inquire into and report on the public sector workforce reduction policies and processes adopted by the Newman Government.
4. Upon the LNP Government’s election in March 2012, Queensland public servants had a legitimate expectation that their job security would be respected. This expectation arose from a number of pre-election statements which had been made by the LNP leader, Campbell Newman. Notable among these statements were the following:
Aspiring premier Campbell Newman has told Queensland’s public servants they have “nothing to fear” from a Liberal National Party government as he officially took over as effective opposition leader …. Mr Newman told reporters today the public service should not be afraid of a government he led.4
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The Liberal National Party would not slash Queensland’s public sector, leader Campbell Newman said today. Mr Newman today repeated his criticisms of the state government’s plan to reduce the number of public servants by 3500 through a voluntary separation program. However, he also pledged not to cut staff numbers if an LNP government was elected. “I’m saying no cutbacks,” Mr Newman said.5
Mr Newman … flagged long-term reductions to the total size of the public service through non-replacement of some employees who leave their positions. “Well I’m saying that we do need to see over time through attrition a reduction in the overall headcount, but not on frontline services which actually in many cases need to go up,” he said. “So this has to be a managed process. We’ll work with the unions. “Every year thousands of people actually do depart voluntarily from the public service and the idea is to manage that; that’s an opportunity to actually not have pain, to not have cuts, but to actually change the shape and size of the organisation, so it then actually is affordable for all Queenslanders and we actually get the budget back into surplus.”6
5. Notably, Campbell Newman made these statements in the lead up to the 2012 State election all while the LNP was making claims about “… Labor’s $85 billion debt”.7 As the Attachment to this submission shows, the LNP was claiming this figure to be the amount of Queensland’s public debt not only prior to the election but also well before the findings of the LNP-appointed Commission of Audit which was headed by former Howard Government Treasurer Peter Costello. The other point which should be made is that the LNP’s claimed debt figure for Queensland of $85 billion is far from being unanimously accepted and has been repudiated by a number of analysts.8
6. Subsequent to the 2012 election, the LNP explicitly linked cutting of thousands of public sector jobs to paying off the claimed debt.9 However, at no time prior to the election did the LNP publicly identify the cutting of government workers’ jobs as being necessary to deal with the alleged $85 billion debt. It should also be noted that when Campbell Newman made his statements in 2011, the number of public servants
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7. It was only after the LNP was elected and Campbell Newman became Premier that he started to publicly claim that Queensland employed too many public servants. Indeed, his initial claim was that Queensland had “… 20,000 more public servants than it can afford”.11 Subsequently, the jobs of at least 14,000 public servants were cut.12 Since then the cuts to public sector jobs have continued despite Mr Newman promising in 2013 that there would be no more.13 Rumours are currently circulating the public service that if the LNP is re-elected in 2015, it will most likely instigate even further public sector job cuts. Statements such as in The Queensland Plan about the Government’s plans to further reduce “Bureaucracy and process”14 do nothing to allay these concerns.
8. The LNP has denied that it “sacked” any public servant.15 The position of the Premier, Campbell Newman, is that, “… employees deemed to be surplus to requirements had a choice about whether to be redeployed to another position or to take a generous voluntary redundancy payout”.16 In reality many government workers whose jobs were cut felt that they had no choice but to accept the “voluntary redundancy” rather than take their chances with the re-deployment option.17 This is because the Government was actively looking to reduce the size of the public service rather than move people to other positions.18 This is confirmed by statements made by senior Government Ministers about the Government’s plans for mass redundancies. For instance, the Treasurer described putting in place “… a voluntary redundancy process for 9,200 employees in order to right-size the Public Service”.19 The Premier made a similar statement: “…I was very clear that the government had a plan to downsize by 14,000 and I said that that is what we would do. That is what we have done and we have done it for the right reasons”.20 In light of these and other similar statements which reveal the Government’s clear intention to cut public sector jobs,21 it is not surprising that the LNP’s claims of government workers having a “choice” and that they could have elected to be re-deployed elsewhere in the public service were widely seen as disingenuous.22
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9. In the drive to cut jobs23 there were instances of some workers whose jobs were cut by their employing agencies without due consideration of the Government’s requirements as mandated under Directive 06/12.24 Under this Directive, it is only after working with an employee and alternative permanent employment options being exhausted that an agency may proceed to offer the employee the voluntary redundancy option. Yet, there were instances of some agencies by-passing the Directive’s requirements first, by not proactively working with the employees concerned to identify any possible alternative permanent employment option and second, by proceeding immediately to offer the voluntary redundancy option when this should have been the last resort. To any reasonable observer, the employees concerned were denied the due process which was ostensibly afforded to them under the Directive.
10. Many of those whose jobs were cut against their will have continued to feel unvalued by the LNP. This perception is not helped by statements made by senior Government Ministers which denigrate public servants and the value of their work. For example, Premier Campbell Newman has described the public service job cuts as getting “the pooper scooper out”.25 Treasurer Tim Nicholls has boasted about the Government creating jobs in Queensland, not “... false jobs in an ever-expanding Public Service, but real jobs...”26 Recently, staff from the Premier’s office reportedly made comments which detracted from public servants and the value of their work.27
11. The LNP’s public service job cuts have had severe detrimental effects on the individuals concerned as well as the wider economy.
Impact of the job cuts on individuals
12. The LNP has claimed that the government workers whose jobs were cut received “very generous payouts”.28 The Premier, Campbell Newman, has gone so far as to state that “… those individuals were all looked after and given, in some cases, quite generous payouts”.29 Based on such comments, the attitude of the LNP appears to be that as the individuals concerned received “very generous payouts”, then they have nothing to complain about.
13. However, the fact is that the workers whose jobs were cut only received a one-off payment which included their other entitlements such as leave entitlements. For many, the one-off payment was not as generous as the significant ongoing salary increases that the LNP proposed for State MPs during 2013.30 Also, because these workers received this one-off payment it made them ineligible to receive other Federal government support payments.
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14. As well, because so many lost their jobs at around the same time, it meant that there was a glut of former public servants looking for work on the job market. This saw many experiencing long-term unemployment, the consequences of which can be devastating for the individuals affected.31 There is no indication as to whether the LNP took these particular factors into account when they embarked on the mass job cuts. It goes without saying that many of those affected would have much preferred to retain their jobs rather than receive a one-off redundancy payment and the uncertainty of long-term job insecurity given Queensland’s unacceptably high and worsening unemployment rate.32
15. There is strong evidence that the true extent of public debt in Queensland is nowhere near the figure alleged by the LNP.33 It was also well known that the size of the public service in Queensland was going to reduce by about a third over the next five years through natural attrition.34 Therefore, there was neither need nor justification for the LNP to take the axe to the public service so severely.35 Yet public servants were unfairly made to take the brunt of the LNP’s budget cuts. Indeed, the Newman Government has admitted that it specifically targeted public servants in its austerity drive.36 The LNP’s treatment of Queensland’s public servants was contrary to the advice of the Grattan Institute that: “It is easier to sell the political pain involved in reducing deficits if all interests are seen to bear some of the burden” and “History suggests that successful budget repair invariably involves both tax increases and expenditure reductions”.37
16. The LNP’s job cuts were crushing for many of the thousands of workers concerned.38 As one commentator has noted,
Even if reducing the size of government was the real priority all along, Queensland could have slimmed down much more gradually. Pushing through these job reductions over a longer time period through natural attrition, rather than slashing 14,000 in forced redundancies this fiscal year, could have saved
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some of the $800 million that the state will now pay out in redundancy packages. It would also have saved a lot of hardship amongst the families of those laid off.39
17. Despite another promise in 2013 from the Premier, Campbell Newman, that the job cuts would cease, the jobs of hundreds of government workers have continued to be cut.40
Impact of the job cuts on the economy
18. In 2013, the Treasurer, Tim Nicholls, said that the LNP’s mass job cuts to the Queensland Public Service “… were necessary to bring the state’s finances into the black”.41 In May 2014, the Deputy Premier, Jeff Seeney, stated that, “… the austerity measures that are being taken at both a state and federal level are very important for the future of our economy”.42 Contrary to such statements, cutting thousands of public sector jobs has had serious deleterious consequences for the wider Queensland economy.
19. Economic confidence has taken a major hit. In September 2012, the Sunday Mail reported that the loss of 14,000 public service jobs “will have an impact on the confidence of all Queenslanders”.43 In April 2013, Deloitte Access Economics reported that, “…confidence among families and small businesses in Queensland is the lowest in the country”.44 Although a late 2013 media report claimed that the State’s economy was “roaring back”, it also conceded that, “local confidence was knocked by public service restructuring and job losses”.45 It only stands to reason that when at least 14,000 pay packets are taken out of the economy, it will put a serious dent in consumer discretionary spending with consequent effects for overall economic confidence.46
20. Even public transport has appeared not immune from the consequences of falling economic confidence. In May 2013, it was reported that, “… in the nine months to the end of March, the number of trips taken on trains was down by two million compared with the previous corresponding period - the worst result in more than five years”.47 Although the Transport Minister, Scott Emerson, was keen to blame other factors for the fall in rail patronage, it seems more than a coincidence that it coincided with the LNP’s mass public sector job cuts over the period.
21. In 2013, Deloitte Access Economics reported that the LNP “overdid” its budget/job cuts and that this has been detrimental and damaging for Queensland’s
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22. In October 2014, retiring LNP MP, Vaughan Johnson, spoke out in Parliament on the adverse consequences of the public sector job cuts for his community.52
23. Queensland is currently experiencing unacceptably high unemployment rates.53 Many of those who are unemployed have been in this situation for quite some time. It is to be expected that many former public servants would number among the long- term unemployed. The consequences of long-term unemployment can be serious not only for the individual but also for the economy.54
24. While the LNP argues that its mass cuts to the public service produced savings,55 the reality is that the cuts are expected to cost Queensland even more in the long run.56
25. In late 2012, Premier Campbell Newman reluctantly admitted that his Government’s decision to cut thousands of public service jobs had had a detrimental impact on the State’s economy.57 The Deputy Premier, Jeff Seeney, has lately conceded that the Government’s reform agenda was “too much, too quick”.58 Indeed, Queensland is still paying the price of the LNP’s decision to cut thousands of public service jobs as well as its many other budgetary cuts. The State is beset with an unacceptably high unemployment rate and an economy which trails behind those of most other Australian States.59
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Conclusion
26. In 2013 the Education, Employment and Workplace Relations References Committee of the Australian Senate handed down its report in response to its inquiry into “Conditions of Employment of State Public Sector Employees”. The report of the Committee stated:
Public sector reform is a contentious issue. The committee understands that staffing reductions and voluntary redundancies can have a significant impact on the individual workers affected, as well as families and communities. The committee trusts that state governments do not make these decisions lightly, and carefully consider the consequences of such reforms.
27. The sentiments and hopes as expressed by the Committee do not appear to have been heeded or duly considered by the Queensland LNP Government.
28. Since its election in March 2012 the Queensland LNP Government has engaged in a mass job-cutting exercise to the State’s public service. Contrary to pre-election commitments by Premier Campbell Newman, the LNP cut the jobs of thousands of ordinary Queenslanders. Again, contrary to a 2013 undertaking by Mr Newman, cuts to public service jobs have continued.
29. The job cuts, including the way they were conducted and processed, have had serious repercussions not only for the thousands of individuals concerned and their families but also for the wider Queensland economy. The evidence is compelling. Questions about whether the Queensland LNP Government gave due consideration to the far-reaching consequences of its decision to cut the jobs of thousands of government workers, and whether the magnitude of the cuts was even necessary, are not only justified but also imperative.
30. The serious economic and social damage and harm caused by the LNP’s mass job cuts to the Queensland Public Service provides impelling grounds for the Select Committee to, at a minimum, review the LNP’s decision-making in relation to the cuts to determine what lessons need to be learned, and what mistakes should be avoided, for the future.
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