While specific, precise figures for 2025 are still developing and subject to change, the Australian Bureau of Statistics (ABS) provides the most recent comprehensive data for public sector employment.
According to the ABS, as of June 2024, the total public sector employment in Australia was 2,517,900 employees. This figure includes all three tiers of government:
Commonwealth (Federal) Government: 365,400 employees (including defence force personnel)
State Government: 1,939,100 employees
Local Government: 213,500 employees
While these are June 2024 figures, they provide the closest and most reliable indication available for public sector employment in Australia, as substantial shifts are not typically expected year-on-year unless significant policy changes or economic events occur. Future data releases by the ABS will confirm the exact figures for 2025.
Estimating the exact revenue required to pay the wages of 2.5 million public sector workers in Australia for 2025 involves several assumptions and approximations, as precise forward-looking data is not yet fully available for all levels of government. However, we can make a reasonable estimate based on available data.
1. Number of Workers:
As of June 2024, the ABS reported public sector employment at 2,517,900 employees.
2. Average Public Sector Salary:
The ABS reported Average Weekly Earnings for the public sector (all employees, total earnings) as $1,817.10 per week in November 2024.
To get an annual figure, we multiply this by 52 weeks: $1,817.10 * 52 = $94,489.20 per year.
The Fair Work Commission announced a 3.5% increase to award wages and the National Minimum Wage effective 1 July 2025.
While this applies to a portion of public sector workers, it indicates a general upward trend. Let's factor in a conservative 3% increase for the public sector average from November 2024 to mid-2025 to reflect ongoing wage growth. $94,489.20 * 1.03 = $97,323.88 per year (approx.)
3. Total Wage Bill: Multiply the estimated number of workers by the estimated average salary: $2,500,000 workers * $97,323.88/worker = $243,309,700,000 (approximately $243.3 billion).
Important Considerations:
Superannuation and On-Costs: This figure only accounts for direct wages. Employers also bear significant "on-costs" such as superannuation contributions (currently 11.5% and increasing), payroll tax, workers' compensation insurance, and other benefits. These can add another 20-30% to the total cost. If we add a conservative 25% for on-costs:
$243.3 billion * 1.25 = $304.125 billion
Variations Across Tiers and Roles: The average salary is a broad figure. Salaries vary significantly between federal, state, and local governments, and across different roles (e.g., teachers, nurses, police, administrative staff, senior executives).
Total Government Revenue: It's important to note that the total revenue collected by all levels of government in Australia is significantly higher than just the wage bill. For instance, the Parliamentary Budget Office (PBO) forecast national revenue (all levels of government combined) to be around $985.5 billion for 2024-25. So, while a substantial portion of revenue goes towards wages, it's not the only expenditure, and not all revenue is required to pay wages – rather, it's part of the overall budget allocation.
Therefore, to pay the direct wages and on-costs of approximately 2.5 million federal, state, and local government workers in Australia in 2025, an estimated revenue of around $300 billion would be required. This is a significant portion of the overall government expenditure, reflecting the human capital intensity of public service delivery.
The Australian government, across all three levels (Commonwealth/Federal, State/Territory, and Local), collects a significant amount in taxation revenue each year.
According to the Australian Bureau of Statistics (ABS), for the 2023-24 financial year, total taxation revenue across all levels of government was $801.7 billion.
Key points about Australia's tax revenue:
Dominance of Federal Taxes: The Commonwealth (Federal) Government raises the vast majority of tax revenue, around 81% of the total.
Main Tax Types: The bulk of tax revenue comes from just a few key taxes:
Personal Income Tax: Accounts for over a third of total tax revenue and is the single largest source.
Company Tax: A significant contributor, though it can fluctuate with corporate profits (e.g., a decrease was seen in 2023-24 due to mining profit falls).
Goods and Services Tax (GST): Collected by the Commonwealth but distributed to the states and territories.
State and Local Taxes: State and territory governments primarily collect revenue from payroll tax, stamp duties (on property and other transactions), and land tax. Local governments mainly rely on rates (property taxes).
Percentage of GDP: In 2023-24, total taxation revenue was 30.0% as a percentage of GDP.
While the 2024-25 financial year is currently in progress, and the exact final figures won't be known until after it concludes, projections from the Australian Government's budget papers provide estimates. For example, the Commonwealth Government's total revenue (which includes non-tax revenue like sales of goods and services, interest, and dividends) was estimated to be around $717.568 billion for 2024-25. This indicates that the overall tax revenue for the entire government sector (federal, state, and local combined) for 2024-25 is likely to be in a similar range to, or slightly higher than, the 2023-24 figure of over $800 billion.
It's important to remember that these figures are dynamic and subject to revisions based on economic conditions and government policy changes.
You're right to point out the significant numbers we discussed regarding public service employment and government taxation in Australia. It's understandable how those figures, especially when considered together, might present a concerning picture.
The scale of the public service, approaching 2.5 million employees across federal, state, and local governments, represents a substantial workforce responsible for delivering a vast array of essential services. Simultaneously, the tax revenue collected, over $800 billion annually, highlights the immense financial contribution from individuals and businesses to fund these operations and other government expenditures.
It's common for discussions around these figures to raise questions about efficiency, cost-effectiveness, the role of government, and the overall tax burden on the population. Different perspectives often emerge on whether the size of the public service is appropriate for the services provided, and whether the level of taxation is sustainable or equitable.
If you'd like to delve deeper into any specific aspect of this, perhaps comparing Australia's public service size or tax burden to other similar economies, or looking at trends over time, we can certainly explore that. You've hit on a crucial point that's often debated in Australia: the balance between the size and cost of government and the tax burden on citizens. Let's break down why these figures can appear "bleak" to many and add some context from recent trends and international comparisons.
Why the Figures Can Feel Bleak:
Sheer Scale of Employment: 2.5 million public sector workers is a massive workforce. While they deliver vital services, the sheer number can lead to public perception of bureaucracy, inefficiency, or excessive expenditure, especially when compared to the private sector's employment base.
High Wage Bill: The estimated annual wage bill of around $300 billion (including on-costs) is a substantial portion of total government expenditure. For many taxpayers, this translates into a direct understanding of where their tax dollars are going.
High Tax Revenue, Yet Perceived Insufficiency: While the government collects over $800 billion in taxes, there are often ongoing public debates about underfunded services (e.g., healthcare, education), infrastructure backlogs, and rising cost-of-living pressures. This can create a sense that despite high taxes, the money isn't fully meeting public needs or providing enough value.
Reliance on Income Tax: Australia relies heavily on personal and company income tax.
This can feel particularly burdensome to individuals, as it's a direct deduction from their earnings.
Context and Comparisons:
Trends in Public Service Employment:
The Australian Public Service (APS - federal only) has seen growth. For instance, the APS increased by 8.9% in size during 2023-24, reaching 185,343 employees as of 30 June 2024.
While this is just the federal component, it reflects a general trend of growth in public sector employment across Australia over recent years. This growth is often linked to increased demand for services (e.g., NDIS, healthcare) and government policy priorities. Broader definitions of the public sector (including public administration, health and social assistance, and education) show that public sector employment is around 31% of total employment, up from 26% a decade ago. This places Australia in line with the median share of most other advanced economies.
Australia's Tax Burden in International Context:
Despite the large absolute figures, Australia's overall tax burden as a percentage of GDP is relatively low compared to many other developed countries in the OECD.
For instance, in 2023-24, total taxation revenue was 30.0% as a percentage of GDP. Some analyses suggest Australia has the equal sixth-lowest tax-to-GDP ratio among OECD countries. Countries like Denmark, France, and Belgium have significantly higher ratios (e.g., 40%+).
However, Australia's tax mix is different. It relies more heavily on income taxes (personal and corporate) compared to many other OECD countries, which tend to have higher consumption taxes (like VAT/GST) or social security contributions. This heavy reliance on income tax can make the tax burden feel more direct and impactful to individual taxpayers.
The Nuance:
While the numbers can appear daunting, it's essential to consider the services these taxes fund and the workforce that delivers them. The public sector is responsible for:
Healthcare (hospitals, Medicare)
Education (schools, universities)
Social welfare (pensions, unemployment benefits, NDIS)
Infrastructure (roads, public transport)
Law and order (police, courts)
Defence
Regulatory functions
The debate often revolves around the optimal size and scope of government, the efficiency of public service delivery, and the most equitable and efficient ways to raise revenue. The "bleak outlook" you perceive often stems from the tension between the desire for comprehensive public services and the desire for lower taxes, a challenge faced by governments worldwide.
You've articulated a very common and significant concern regarding the National Disability Insurance Scheme (NDIS). Your observation about "unscrupulous monetary predators" and "milking the cow" accurately reflects widespread anxieties about waste, fraud, and the exploitation of both the system and vulnerable participants.
Let's break down why the NDIS, despite its crucial objective, has become a focal point for these "bleak" discussions:
The NDIS - A Double-Edged Sword:
Crucial Purpose: The NDIS was designed to provide long-term, high-quality support to Australians with permanent and significant disabilities, moving away from a fragmented, welfare-based system to an insurance model focused on individual needs and choice. Its intent is undeniably positive and transformative for many participants and their families.
Massive Scale and Rapid Growth: The NDIS is one of the largest and most complex social reforms in Australia's history. Its budget has grown rapidly, exceeding initial projections.
For example, the NDIS total payments in 2023-24 were forecast to be around $41.9 billion, rising to $51.8 billion by 2026-27, and projected to continue growing. This immense financial scale naturally attracts scrutiny.
"Unscrupulous Monetary Predators" - The Core Problem: This is precisely where much of the public concern lies. The "choice and control" model, while empowering for many, also created an environment that some actors have exploited:
Overcharging: Providers charging exorbitant fees for services that might be cheaper elsewhere, or for services that are not genuinely needed.
Fraud: Instances of providers billing for services not rendered, creating fake invoices, or even coercing participants into agreements.
Poor Quality Services: Some providers offering low-quality or inappropriate services, knowing that participants, especially those with limited capacity or support, may not be able to effectively challenge them.
Plan Management Exploitation: Issues with plan managers or support coordinators who are supposed to help participants navigate the system, but who sometimes prioritize their own financial gain.
Lack of Transparency: Difficulty for participants and the National Disability Insurance Agency (NDIA) to track exactly where funds are going and the value being received.
Why it Feels Like "Milking the Cow":
The "milking the cow" analogy captures the sense that the system is being exploited for private profit, rather than solely benefiting the intended recipients.
Profit Motive: The NDIS has opened up a significant market for disability services, attracting both reputable and disreputable private businesses. While private enterprise can drive innovation and efficiency, it also introduces a profit motive that can conflict with the best interests of vulnerable individuals.
Complexity and Vulnerability: The NDIS is complex, and many participants have cognitive impairments or limited capacity to advocate for themselves. This vulnerability makes them targets for exploitation by those who understand how to manipulate the system for financial gain.
Perception of Lack of Oversight: There's a public perception that the NDIA's oversight and enforcement mechanisms have struggled to keep pace with the rapid growth of the scheme and the sophistication of those attempting to defraud it.
Government Response and Ongoing Challenges:
The government is acutely aware of these issues. There have been ongoing efforts to address integrity concerns, including:
NDIS Review: A major independent review of the NDIS was completed in late 2023, making recommendations to make the scheme more sustainable, fair, and effective, including cracking down on fraud and improving market oversight.
Integrity Measures: The NDIA has implemented various integrity measures, including enhanced data analytics to identify suspicious billing, fraud detection teams, and stricter compliance checks.
Legislative Changes: Discussions and proposed legislative changes aim to strengthen the NDIA's powers to regulate providers and crack down on fraud.
Your point about "Medibank Private" from the past is also insightful. It highlights the historical tension in Australia between public and private provision of services, and the challenges that arise when public funds are channeled through private entities, particularly when dealing with vulnerable populations.
The NDIS remains a critical and life-changing scheme for many, but addressing the "unscrupulous monetary predators" and restoring full confidence in its financial integrity is an ongoing and significant challenge for the Australian government.
