Senator Critical as Federal Public Service Budget Blows out by Nearly $1 Billion

Government staffing budgets were the subject of scrutiny at a recent Senate sitting.

Liberal Senator Jessica Collins cited analysis by the Australian Financial Review showing staffing budgets had blown-out by $841 million (US$546 million) in the previous year.

“Unexpected and uncosted employment payments … are the result of thousands of new public service hires, artificially increased pay rises and exploding workers’ compensation payments,” she said at a recent Senate sitting.

“That there are unexpected and uncosted payments shows how utterly incompetent this government is with managing the federal budget and taxpayers’ money.”

According to the analysis, Services Australia—which oversees Medicare and Centrelink programs—experienced a $235 million blow-out of its payroll.

Similarly, the budget for the federal Department of Climate Change and Energy increased by $70 million.

“This department is so totally focused on ramming through its green agenda that it’s not just national parks and farmland that are being destroyed, but the staffing budget too,” Collins said.

Taxpayers to Bear the Brunt: Senator Warns

Collins also said it was taxpayers bearing the brunt of the costs.

“Current government taxes cannot pay this bill. The Treasurer takes out loans to cover the costs, and you, your children and your grandchildren will pay for it,” she said, highlighting concerns with Australia’s impending $1 trillion debt.

Federal Payroll Reaches $40.8 Billion

Collins’s comment comes as new data from the Australian Bureau of Statistics (ABS) showed the federal government’s payroll rose $40.8 billion in the 2024–25 financial year, continuing a run of consecutive increases.

The cost of the public service was $37.3 billion in 2023–24, and $33.9 billion in 2022–23.

According to the ABS, the rise in government payroll reflected “a combination of underlying wage growth driven by new enterprise agreements and growth in employment.”

During the 2024-2025 financial year, the number of federal employees (including defence force personnel) grew to 385,900, up 20,000 from 2023-24, and 35,000 from 2022-23.

Regarding wage growth, the ABS reported that annual public sector wages increased by 3.8 percent in the year to the September 2025 quarter, slightly up from 3.7 percent at the same time last year.

Minister Defends Government’s Employment Policies

In the 2025 federal budget released early this year, Public Service Minister Katy Gallagher defended the increase in the federal headcount, saying it was necessary to address a decade of underinvestment by the previous Coalition government.

“An investment in our public service and its capability is an investment in the future security and prosperity of Australia,” she wrote in the budget paper (pdf).

“The Australian government recognises it cannot deliver outcomes for Australians without the foundations of a strong public service.”

The minister also noted that the number of federal employees currently accounts for 1.5 percent of the labour force, which is still below the 1.6 percent recorded under the Howard government in 2006-07.