The defence services sector (such as advisory firms, logistics and facilities management companies) will closely monitor the headcount and skill set changes in Defence. The steady reduction in the number of public servants will be halted by the Defence White Paper (DWP), and the total number of Defence employees will rise from 75,900 to 80,600 (ADF and APS permanent positions).
However, while the detail is still emerging, it seems clear that the goal is to reduce headcount in some administrative areas to enable increases in others. The areas that should benefit include intelligence, maritime and anti-submarine, strike and air combat and land and amphibious capabilities.
Defence Services can therefore reason that the agenda of ‘contractorisation’ in project management, engineering, logistics and supply chain services across the Department will continue. Just as in the ICT and Infrastructure sector, Defence Services companies must grow (through internal development or acquisition) the necessary capacity to satisfy this new demand.
As well as headcount reduction in key enabling capabilities that will need to be supplemented by industry, it is likely that Defence will require assistance in learning to work in an environment where contractors are a part of the integrated workforce required to deliver capability.
In addition to the guidance in the DWP, the First Principles Review indicates to this sector the requirements of Defence to enhance many of its enabling capabilities. The services sector has a key role in partnering with Defence to enhance these capabilities, including bringing innovation from other industries and helping Defence to identify how these experiences can be implemented in the Defence context.