Evidence to a Parliamentary Committee had confirmed public service job cuts would be greater than the announced 1600 and that there were concerns that savings targets would not be met if the number of separation packages was restricted to 1600, Liberal MLC Rob Lucas said today.
Ray Garrand, CEO Department of Further Education, Employment and Science Technology (DFEEST), told the Legislative Council Budget and Finance Committee on 20 April 2009 that his department’s share of the 1600 job cuts was 127; however:
“…we will need to go beyond that target in terms of trying to achieve the efficiencies that we want to try and achieve and given the redeployees that we currently have.”
The Budget and Finance Committee transcript (20 April 2009) reveals the following:
Hon R Lucas: “…you have approval to offer packages for only 127 full time equivalents. You have a whole range of other people who are already surplus – and some soon to be surplus – who will say ‘how fare is this?’ Those 127 are going to get a package of up to two years’ salary for 20 years service or whatever and you are asking me to go for nothing.
Mr R Garrand: “No, that’s not the case. We will be trying to negotiate through various funding arrangements with Treasury the capacity to offer that package to staff beyond that.”
“It is clear that departmental Chief Executives are concerned they will not be able to achieve their required budget savings imposed in the 2006-07 and 2008-09 budgets unless the Rann Government changes its policy of restricting separation packages to a total of 1600,” Mr Lucas said.
“On the other hand, if the Government does allow more separation packages, then the total budget cost will increase significantly.
“The upfront total cost of the 1600 targeted voluntary separation packages (TVSP) is estimated to be about $160 million based on government figures provided in 2006. The major cost impact on the budget deficit will be felt in the 2009-10 budget year.
“Minister Jay Weatherill in 2006 told Parliament – when the TVSP scheme was last used – that 222 TVSPs cost $20.94 million, or an average of $94,324 per TVSP. Given wage increases since 2006, the average cost is now likely to be at least $100,000 per TVSP.
“The Rann Government’s TVSP scheme is significantly more expensive than the schemes used by previous governments as it offers an extra 12 weeks payment, up to a maximum of 116 weeks payout,” he said.
“For example, a 49 year old public servant earning $95,000 per annum who started at age 17 would receive a total payout of about $212,000 plus payments for long service leave and unused recreation leave.
“The stunning hypocrisy of the Rann Government on this issue will be evident to all South Australians as they will clearly remember all the promises at the last election about no cuts to public service jobs!”