Victorian Labor’s Budget Fix: Thousands of Public Sector Jobs on the Chopping Block

Allan government commissions review to tackle waste and refocus spending on key services.

Commuters leave and arrive at Flinders Street Station in Melbourne, Australia, on Sept. 4, 2015. Michael Dodge/Getty Images

The Allan Labor government has commissioned an independent review of Victoria’s Public Service (VPS) as the state’s debt continues ballooning ahead of the May budget.

The move is expected to cut up thousands of public service jobs—a plan earmarked by former Treasurer Tim Pallas.

Led by Helen Silver, the review will assess waste, duplication, and spending within government departments. She previously served as secretary of the Department of Premier and Cabinet.

Premier Jacinta Allan said the public service review would ensure services were targeted at essentials like education, healthcare, and public safety.

“Victorians rightly expect government to be laser-focused on their priorities—whether that’s good schools and hospitals, help with the cost of living, or keeping communities safe,” she said.

Premier of Victoria Jacinta Allan speaks during a Cricket Australia Media Opportunity at Melbourne Cricket Ground in Melbourne, Australia, on Aug. 18, 2024. Asanka Ratnayake/Getty Images for Cricket Australia

Treasurer Jaclyn Symes said the aim was to bring the public sector workforce back to pre-pandemic levels, cutting around 5 percent of current staffing.

“This is about getting government back to the basics and delivering on what matters most to working families,” Symes said.

The review, which begins immediately, will provide preliminary recommendations ahead of the May budget, with a final report due by June 30.

The move also comes a day after the Auditor-General’s Office criticised the government for having little control over the spiralling cost of infrastructure, with its report revealing an $11 billion surge in costs, with nearly half of the state’s 110 projects exceeding initial estimates.

Public Sector Union Pushes Back

The Community and Public Sector Union (CPSU) has vowed to fight the job cuts, accusing the government of “public service bashing for cheap votes.”

CPSU secretary Karen Batt criticised the move, comparing it to efficiency measures in the United States under President Donald Trump and Elon Musk.

“We have been highlighting unnecessary duplication for years, but this approach seems more about scoring political points than real reform,” Batt told ABC news.

Treasurer Symes, however, insisted that the government is committed to careful consultation throughout the process.

“We are looking to consolidate, eliminate, and refocus areas that are not delivering on the highest priorities for Victorian families,” she said.

Frontline Workers Exempt

The government has confirmed that essential frontline workers, including nurses, teachers, police officers, and child protection workers, will not be affected by the review.

Capital expenditure projects, such as the West Gate Tunnel and Suburban Rail Loop, will not be included in the review.

The final findings will be reported directly to the premier and treasurer before being made public alongside the government’s response.