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Tuesday, 3 February 2009
Page: 133

Dr Southcott asked the Minister for Employment Participation, in writing, on 1 December 2008:

In respect of the $370.2 million in savings in Employment Services for the 2009-10 to 2011-12 financial years identified in the 2008-09 Budget Papers (Budget Paper 2, page 388): (a) how was this figure calculated; (b) what assumptions were made; (c) was any modelling done to support this figure; (d) what sum of these savings is of an administrative nature; (e) are these savings contributing to the Department of Education, Employment and Workplace Relations’ efficiency dividend; and (f) have these savings been revised in the Mid-Year Economic and Fiscal Outlook 2008-09.

Mr Brendan O’Connor (Minister for Employment Participation) —The answer to the honourable member’s question is as follows:

(a)   As advised in the response to question number 396 and Senate Estimates Questions on Notice 262 and 899, as the new Employment Services are not based on the current model it is not possible to isolate the specific areas of saving and hence provide an exact breakdown. In general terms the savings have been achieved by reducing red tape and unnecessary administration.

(b)   The assumptions used, which run into the thousands, are held within a departmental financial model and are based amongst other factors on a forecast of the number of job seekers to be serviced, their level of disadvantage including their length of unemployment and the number of job seekers who will be placed in employment.

(c)   Yes.

(d)   Approximately $350 million are administered funds and $20 million departmental funds.

(e)   No. These savings are not related in any way to the efficiency dividend applied to the Department.

(f)   The savings figures have not been revised in the Mid-Year Economic and Fiscal Outlook 2008-09. The new Employment Services model is demand driven and the forward estimates will need to be updated due to the impact of the Global Financial Crisis.