September 2026

The federal bureaucracy has grown enormously since Anthony Albanese became Prime Minister and it’s one of the key reasons why inflation is stubbornly high and households are paying higher interest rates.

Reserve Bank governor Michele Bullock has made it clear that high government spending is a major factor feeding inflation, which has caused three interest rate rises this year – with likely more to come. A big component of the profligate government spending is the rapid expansion of the government workforce.

Since Albanese became PM, the Federal Government has been adding public servants to the public payroll at the rate of 28 per day, lifting the number of public servants from around 159,000 to close to 200,000.

That’s costing an additional $8 billion a year in wages and salaries, without taking into account other major costs, such as renting office space.

This has generated considerable media discussion, including a feature in The Australian Financial Review on 31 August 2026 which reported: “The number of bureaucrats is nearing a record 200,000 thanks to a 23% rise over three and a half years – the largest recruitment drive this century.”

The AFR asked: “Labor has added 28 public servants every day – is that too much?”

The AFR analysis of 103 federal agencies revealed that 92 of those agencies had grown their staff numbers between June 2022 and December 2025. It suggested the reasons for the recruitment drive included a reduction in external consultants and apparent workforce shortages in some departments, but the biggest factor was massive growth in two specific policy areas – Defence and the National Disability Insurance Scheme (NDIS).

Independent economist Chris Richardson told the AFR that the expansion was underpinned by a crisis in productivity, which means getting stuff done needs more workers. The report said: “The public service’s risk-averse and hierarchical culture – perhaps borne of the public’s intolerance of government mistakes – slows down bureaucratic decision-making and contributes to that productivity malaise.”

Richardson commented: “It is fair to say that public sector productivity growth hasn’t been as impressive as it could have been. Our problem is that politicians don’t try to maximise efficiency; they try to minimise front pages.”

The AFR report said it was undeniable that the Federal Government’s recruitment drive had added immense pressure to Treasurer Jim Chalmers’ already deficit-ridden budget – but excluded from the Budget papers. “That’s around $8.4 billion of spending every year (on average) which is conveniently left out of the budget papers and flatters the budget bottom line. No wonder the usually quiet economists at the Parliamentary Budget Office spoke out last month to criticise the ‘optimism bias’ baked into the budget.

“Richardson is less diplomatic, calling it ‘industrial-strength gaslighting’.”

Since Albanese’s 2022 election win, Labor lifted the number of public servants from 159,179 in June 2022 to 195,847 in December 2025 – a jump of about 36,700. At the daily rate of hiring, by now total numbers would be above 200,000.

Around 9,700 bureaucrats were added in health, disability and aged care departments, while 6,060 were added in Defence-related departments. The agency that has grown the most, by far, is the agency that administers the NDIS. It has added nearly 6,000 new staff in four years – or around five people every day. It now has a workforce of over 11,000. Some new agencies have been created by Labor, such as the Australian Submarine Agency (802 staff), the National Anti-Corruption Commission (240 staff) and the Parliamentary Workplace Support Service (75 staff).

Ironically, one of the few agencies that has reduced staff is the Productivity Commission (which has been critical of the Albanese Government in a number of areas.

Chris Smith, who hosts the weekday morning program Chris Smith Across Australia on 2SM and the Super Radio Network, called the numbers “staggering” and “mind-boggling”, as the largest public service recruitment drive this century rolled out “at breakneck speed”

Smith commented: “We’re not talking about a steady, measured growth to meet the needs of a growing nation. We’re witnessing an unprecedented bureaucratic explosion.

“But what are we, the public, actually getting for this massive investment? The uncomfortable truth is: very little.

“This reckless recruitment policy is a textbook economic illusion. Hiring waves of bureaucrats does not drive genuine national productivity – which is sitting at zero. Nor does it spark economic growth. True productivity comes from innovation, private enterprise, and competitive industries creating tangible value.

“Government departments, by their very nature, do not generate wealth. They consume wealth. So by aggressively hoovering up talent from the private sector … Canberra is actively starving productive businesses of the workers they desperately need to innovate and expand. We’re pulling skilled professionals out of wealth-generating industries and locking them behind desks in Canberra, where success is measured by the length of a committee meeting – not by output or efficiency.

“This is classic modern-day socialism, where the state takes further control and stymies productivity.”