Shadow Treasurer Rob Lucas said today significant doubts had emerged over the accuracy of claims made by Treasurer Foley over a key budget announcement of a shared services centre.
The shared services centre was the centrepiece of the government’s proposed budget savings programme and is a proposal to centralize ‘back office’ functions such as payroll, finance, human resources and information technology.
Mr Lucas said this proposal was meant to save $130 million starting with $25 million next year, then $45 million in 2008-09 and finally $60 million a year from 2009-10 onwards. About 600 of Mr Foley’s announced 1600 job cuts were to come from this proposal.
“However, a senior Treasury source has advised the opposition that there is ‘no way’ the shared services centre will be up and operational by July this year and that the claimed savings will not be achieved for next year or any of the following years,” Mr Lucas said.
“Mr Foley told the estimates committee 5 months ago that plans were advanced and that the key collection of existing agency baseline cost data had already commenced. However that statement was not true as the government’s own web site confirms the actual collection only started a bit over one month ago.
“The obvious question for Mr Foley is, if he still doesn’t know how much agencies are currently spending then how on earth can he predict confidently that $130 million and 600 jobs will be saved?”
Mr Lucas said it is clear that a number of agencies are strongly disputing that savings of this magnitude were ever likely to be achieved and there are also senior officers in Mr Foley’s own department who also share the same view. Agency sources have also confirmed the government still hasn’t decided whether to establish one, two or three centres!
“It should be noted that the government has already spent more than $1 million on consultant costs and now has a team of about 25 public servants at an estimated cost of more than $2 million a year working on the proposal.
“The fact that Mr Rann has now given responsibility for the proposal to the hapless Minister Wright is mind boggling and senior public servants are already expressing concern at his capacity to handle the job.
“If these savings cannot be achieved then it casts significant doubt over the accuracy of key estimates in Mr Foley’s budget.”