Labor's $11.1 Billion Budget Lie

Media Release

10 February 2025

Katy Gallagher’s credibility is in tatters after new analysis has shown a $11.1 billion black hole in Labor’s Budget, due to an assumption that there will be a 20,000 reduction of public servants.

Independent analysis from the Parliamentary Budget Office (PBO) has shown that Labor’s Budget assumes that the public service will decrease by more than 20,000 in over four years from 1 July 2025 compared to the current level of 209,150.

This is despite the fact that Minister for the Public Service Katy Gallagher has been adamant that Labor would not cut public servant numbers, after they expanded the public service by 20% - an additional 36,000 people since coming to office.

The PBO has calculated that retaining the public service at its current level, as Labor proposes, would cost the Budget an additional $11.1 billion over the four years from 1 July 2025.

Shadow Minister for Finance and the Public Service, Senator Jane Hume said this $11 billion black hole has shown Labor’s Budget has absolutely no credibility.

“First we discovered an unfunded 11% increase in public sector wages, and now we have independent analysis showing Labor hasn’t accounted for 20,000 public servants that it says it will keep.

“Labor has been adamant that they are not going to cut the public service, so how are they going to pay for this $11 billion black hole? Will they tax Australians even more to pay for this, or are they going to take money out of front line services to pay for these wages?

“The Albanese Government has never been honest about their Budgets. But now they’ve been caught red handed, they must come clean on how they are going to pay for the bureaucrat binge they claim is a necessity.

“Katy Gallagher is completely out of her depth in managing the nation’s finances, and every single Australian taxpayer will pay the price for Labor’s bloated bureaucracy.

“Only the Coalition will stop the exponential growth in the public service which is costing taxpayers billions, and refocus it on delivering services that make a difference to everyday Australians.”