Gallagher says no jobs cuts amid APS razor gang warning

Wednesday 26 November 2025

Dana Daniel and Eleanor Campbell

The Canberra Times

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Finance Minster Katy Gallagher has defended her department’s latest push to cut costs across the federal bureaucracy as “fiscal discipline”, while insisting there will be no job losses.  

“We need to ensure that we’ve got resources available to meet all of the pressures that are coming the way of the public service,” Senator Gallagher told the Senate on Tuesday after the Australian Financial Review revealed the Albanese government’s latest efficiency drive seeking reductions of up to 5 per cent.  

She said the government was “not looking to reduce ASL [Average Staffing Levels]” as part of the savings, which will be reflected in next year’s federal budget.  

“We’ve asked agencies to think about all the things they’re doing and make room for reprioritisation within budgets,” Senator Gallagher said.

“We’ve been doing that since we came to government.”

ACT Independent Senator David Pocock accused the Albanese government of “hypocrisy” after it criticised the Coalition’s 2025 election policy to slash the APS, while the Community and Public Sector Union warned “arbitrary cuts ... inevitably result in job losses.”

Senator Pocock said a 5 per cent reduction would be “an absolute disaster” for smaller agencies.  

“If you look at the AFP, the CSIRO, the Gallery and the [National] Library, they cannot get by with a 5 per cent reduction in their budget,” he said.

Senator Gallagher dismissed this as “untrue” and pointed out Canberra institutions like the National Gallery of Australia were exempt from the current 1 per cent efficiency dividend.  

The CPSU said any reduction was “extremely concerning”. “The Federal government was re-elected with a promise of continuing the work of investing in the rebuilding of the public services, not cuts,” the union said.

Opposition finance spokesman James Paterson said Labor “repeatedly said during the election they would make no cuts to the public service” but were now “desperately looking for savings to get their budget under control”. He called on Senator Gallagher to “come clean about the secret letter” sent to agencies, after she refused to table the correspondence in the Senate, where the Coalition and Senator Pocock are seeking to compel its release today.  

The government directed agency heads earlier this year to slash $800 million from their collective 2025-26 budgets to deliver on the Albanese government’s 2025 election commitment to cut $6.4 billion from non-wage expenses including travel, hospitality, Labour hire, advertising, legal and property services over four years from 1 July 2025. This measure includes further savings of $1.6 billion in 2026-27, $2 billion in 2027-28 and $2 billion in 2028-29 and come on top of $4 billion cut from APS outsourcing in the Albanese government’s first two budgets since winning government in 2022.  

The CPSU and the Australian Federal Police Association have each written to Senator Gallagher seeking clarification. The CSIRO has cut about 818 jobs over the past 18 months, as part of an ongoing restructure to save the science agency $120 million. Treasury plans to cut 250 jobs over two years as the department resorts to redundancies to try to balance its budget, while Social Services Department’s budget is projected to fall from $636.4 million in 2024-25 to $424.6 million by 2027-28.  

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