Media release

15 January 2008

Department of Foreign Affairs and Trade Budget Savings

Prior to the election, the Shadow Minister for Finance and now Minister for Finance, Lindsay Tanner MP, made a number of budget savings announcements across a broad range of areas of Commonwealth expenditure, to ensure that the Australian Government’s budget position remains strong and to put downward pressure on inflation.

As part of the Government’s overall election commitments, like other government agencies, the Department of Foreign Affairs and Trade’s budget will be reduced.

This will involve savings of $57.25 million over the next three and half years.

As part of its election commitments, the Government announced the reversal of a number of the previous Government’s spending decisions and the implementation of a one-off efficiency dividend of 2%.

Approximately a third ($20.2 million) of the total will be saved through the implementation of the Government’s election commitment to reverse funding for the previous Government’s ‘Australia on the World Stage’ initiative and through reductions in other cultural relations funding.

In addition, $14.35 million will be saved through reductions in the Department’s administrative budgets. These reductions will largely be related to travel and representation funds.

Unavoidably, these budget reductions will have an impact on staffing levels. A total of 20 Australia-based positions will be removed from DFAT’s overseas network by the end of this financial year (saving $18.7 million). These positions are at a range of levels, covering administrative, policy and consular functions.

The budget cuts will not adversely affect overall DFAT negotiating resources devoted to China FTA negotiations. The number of staff in DFAT’s negotiating team will remain the same as it was in the last round of negotiations in October 2007.

The posts affected by the withdrawal of positions are Athens, Beijing, Berlin (two positions), Brussels, Cairo, Copenhagen, Kuwait City, London, Mexico City, Nairobi, Ottawa, Pretoria, Riyadh, Rome, Santiago de Chile, Seoul, Stockholm, The Hague and Vienna (UN).

To achieve the required savings, the Department will also implement a partial recruitment freeze which will result in 24 fewer positions in Canberra (saving $4.0 million). All reductions in staffing levels will be accommodated through natural attrition. No staff will be made redundant in order to achieve these savings. None of the budget cuts are security-related.

The Government does not believe these savings will adversely impact on the implementation of the Government’s foreign policy and trade policy priorities.

Media inquiries: Mr Smith's office 02 6277 7500 - Departmental Media Liaison 02 6261 1555