The government is considering centralising back-office functions such as human resources, payroll, and IT systems in an effort to reduce duplication and save billions of dollars.
The Public Service Commission said it would shortly begin identifying all-of-government suppliers for human resources and payroll systems. That formed part of the Commission’s push to “standardise and streamline back-office systems”, a move it expected would save $160 million over a decade by eliminating duplicated legal, procurement, configuration and other costs.
Public Service Minister Paul Goldsmith said he expected agency chief executives to be in regular contact with one another about the most efficient ways of operating.
“Sometimes there are very small agencies repeating the functions in back-office areas where some overlap between different entities would make sense, and that’s what we’d expect them to be considering.”
The Public Service Commission also referred to the “digital government target state” — the planned streamlining of digital services aimed at removing inefficient agency siloes and reducing costs.
That would largely be achieved through the creation of “digital clusters” — 10 of which are expected to be in place by June 2028 — where groups of agencies would share IT systems, delivering an estimated $5.9 billion in savings over 10 years.
The commission had sought Goldsmith’s endorsement of the proposed approach.
It said that while multi-agency technology solutions could cost more or “take longer in the short term”, they would ultimately deliver savings and clearer benefits.
However, it warned that while initial progress was being made within agency baselines, targeted investment—both centrally and at the agency level—would still be required over time to realise the full benefits of the centralised approach.
Goldsmith was advised that there were opportunities for him to drive change towards a more unified, digital-first public service.
It said it wanted the public service to become “a magnet for the best and brightest.”
The commission said those opportunities were grouped into three main areas: transforming the operating model, strengthening integrity and ethics to combat corruption, and ensuring sustainability by “managing agency performance and the Public Service workforce.”