CenITex tries massive contractor conversion

Victorian government IT shared services agency CenITex has made wide-ranging offers to employ its extensive contractor workforce as full-time public servants to allow it to cut costs.

Peter Blades at the symposium
(Credit: Suzanne Tindal/ZDNet.com.au)

CenITex inherited a workforce of 70 per cent contractors from organisations merged to form CenITex in 2005, according to a recent letter from Peter Blades to contractors seen by ZDNet.com.au. Speaking recently in Sydney, he had said that ratio had already been brought down to 40 per cent.

As of 30 June last year, CenITex had 336 staff, 176 of which were contractors.

Blades said in the letter that CenITex was now looking to bring the level of contractor employment down further by converting a "substantial" number of contractors to be public service employees. The first wave of conversions was to happen within the hosting services department of the agency.

Blades acknowledged that the transition would mean an absolute rate cut for the contractors involved (quoting market data which indicated that a 20 to 30 per cent cut could be expected, although most contractors would not be asked to take such a high cut), but claimed there were other benefits for joining CenITex as a public service employee.

He drew attention to better job security, development opportunities, paid leave and sick leave, as well as salary packaging options, discounted rail tickets and subsidised gym memberships.

CenITex was to contact contractors shortly regarding the offer. CenITex is offering fixed term (12-month) employment. As the agency defined its future operating model, it would finalise its long-term structure, according to Blades.

"In short, the offer to be presented will provide you with the greatest level of security that CenITex can offer at this time; a fixed tenure and a priority over contractors should there be competition for particular roles," he said.

Last year the agency had come under fire from the state's opposition for having chief information officer and chief operating officer roles filled by contractors earning almost $400,000 and $500,000 per annum respectively — rates the opposition considered exorbitant. The chief information role was dissolved, with its former occupant Bruce Carlos leaving CenITex. The chief operating officer role was advertised late last year.

The executive who had been carrying out the role, Thana Velummylum, moved to work in the Efficient Technology Services section of the agency for a reduced annual pay rate of $450,000.