A new Minns Labor Government Core Work Policy will prioritise the in-house delivery of essential services, marking the next step in reforms to reduce spend on consultants and boost the capacity of the public service.
The previous Liberal-National Government averaged a new consultant contract every hour over their last five years in office, while the NSW Auditor-General found that they spent around $1 billion on consultants without having adequate procurement and managements policies in place.
Under the policy, NSW Government agencies are required to prioritise in-house delivery of essential government functions. External support will only be considered after internal capacity has been assessed and ruled out.
The policy represents a major change in how government work is delivered, aiming to restore public trust and ensure that critical services are led by accountable, experienced public servants, rather than for-profit consulting firms.
Agencies will be expected to deliver the following core functions internally:
- Development of legislation and regulation
- Development of Cabinet submissions and advice to ministers
- Policy development, analysis and recommendations
- Grant administration program design, administration or management
Under the new rules, external providers may only be engaged in limited, clearly defined circumstances, such as:
- Temporary surge capacity
- Independent audits
- Specialist capabilities essential for cultural safety and integrity, including work involving First Nations communities
The policy also encourages government agencies to utilise the expertise of universities, community organisations, and civil society when external or independent advice is required, rather than automatically using for-profit consulting firms. This change will allow the government to develop a more diverse and resilient ecosystem of external support.
The Core Work Policy introduces new governance and accountability measures, including requirements for agencies to:
- Identify and define their own core work
- Develop transition plans to reduce external reliance
- Track and report the proportion of core work delivered internally
- Set annual capability-building targets
- Report on progress annually
The Minns Labor Government was elected with a clear mandate to reduce wasteful spending, rebuild internal capability, and end the culture of outsourcing entrenched under the former Liberal-National Government.
The Government's reforms on external consultants and contractors are already beginning to deliver. In 2023-24 the Minns Labor Government realised more than $450 million in savings on external consultants and individual contractors.
Work to implement the Core Work Policy is underway and government agencies will be required to integrate core work targets into their 2025-26 corporate plans.
Minister for Domestic Manufacturing and Government Procurement, Courtney Houssos, said:
"This policy is about putting the public back in public service. It ensures that core work is led by accountable, experienced public servants, not handed off to consultants or private contractors.
"This is a critical step in restoring the capability of the NSW public service.
"We are ending the overreliance on consultants, safeguarding institutional knowledge, and ensuring taxpayer money is spent wisely.
"This policy equips our public service to not just respond to today's challenges, but to plan, lead and deliver the long-term priorities of the state."
