The Government has decided that all agencies are to achieve savings through rationalisation of corporate services and expects a minimum saving of 10% across the budget sector.

It is recognised that there will be scope for more savings in some agencies than others. Accordingly, targets for individual agencies will be higher or lower than 10% depending on their individual circumstances.

As the first step in setting targets, each budget sector agency is to cost their corporate services using the attached methodology and submit results to the Office of the Council on the Cost of Government (OCCG) by 1 September, 1995.

Agency responses will be reviewed and negotiations will take place between the Treasury, the agency and OCCG to set targets. Agency budgets for the second half of 1995/96 and thereafter will be adjusted to reflect the savings targets. Ministers are to ensure accountability for the achievement of savings is factored into CEO and SES Performance Agreements.

To assist agencies in meeting targets OCCG will arrange workshops, promote networks, facilitate exchange of information and provide advice. The costing information will be used to provide baseline data to agencies for benchmarking of corporate service functions.

Benchmarking is expected to generate substantial additional efficiencies in corporate services in the medium to longer term by enabling agencies to focus on a number of best practice options for service delivery. OCCG will bring together agencies to develop benchmarking networks in corporate service areas, with human resource management and finance a priority. Agencies will be contacted shortly regarding participation in this benchmarking initiative.

Ministers are to ensure that all agencies in their portfolio nominate an officer to be the agency contact for this project. A seminar on the project with particular emphasis on the OCCG costing methodology will be held at 11 am, Wednesday, 5 July, 1995 on Level 31, State Office Block, Phillip Street, Sydney. Agencies should facsimile details of the contact officer and attendees to OCCG on (fax) 228 3277 by Monday, 3 July, 1995.

Premier