Workers affected by some 280 job cuts at Victoria's central IT agency, CenITex, could face a tight job market due to a state government hiring freeze.
The job cuts are thought to affect about 50 continuing staff, with a further 70-80 vacant positions not being filled.
The bulk of the cuts are thought to be contractors.
CenITex was established in 2008 under the previous state government to serve the IT needs of the whole Victorian public service.
It is facing a shake-up of its operations following several critical investigations, including a police probe by the fraud and extortion squad, an Ombudsman's inquiry, and a review by the State Services Authority that has been labelled confidential by the Victorian government.
Chief executive Michael Vanderheide, who took the job in July last year after a stint as chief information officer of the Victorian police, informed staff last week about the plan to axe jobs.
He told iTnews the organisation was in the midst of a consultation process with staff over the proposed job cuts and declined to comment further.
The Community and Public Sector Union (CPSU) has until next week to respond to CenITex's proposed job cuts.
Jim Walton, assistant branch secretary of the Victorian branch of the CPSU, said the union could not realistically prevent the job cuts and would have a tough time getting its members redeployed because of a hiring freeze imposed on the state's public sector in December.
“How can they find jobs working in their area of expertise in another government department when no government department is filling jobs?” Walton said.
“If someone finds they are surplus, they will probably be retrenched because there are no jobs to go to.”
The Victorian government is cutting at least 3,600 public sector jobs over two years. Walton said CenITex was meant to be exempt and thus its 280 job losses would not be counted toward the total.
In his letter to the union last week, Vanderheide said that CenITex's departmental clients had reduced their IT budgets for the 2012/2013 financial year, while CenITex faced rising costs.
He added that the fact that many clients had reduced staff numbers lessened the value of some contracts.
“The situation was not wholly anticipated until recently, but the extent of the budget shortfall is significant, and will require urgent action to address,” Vanderheide said in the letter.
In the letter to the union, CenITex identified specific job titles to be axed – mostly IT staff, but also positions in accounts, HR and customer service.
Meanwhile, CenITex’s board of directors will likely be replaced after the agency was listed as a “reorganising body” under the State Owned Enterprises Act 1992 late last month.
CenITex chairman, former bureaucrat Warren Hodgson, resigned after the announcement of the listing, which allows government to remove the board of directors and appoint an administrator.
A spokeswoman for Victorian Premier Ted Baillieau said the government had yet to decide on whether to appoint an administrator or leave the board in place.
Victorian Assistant Treasurer Gordon Rich-Phillips said the changes would improve CenITex's “accountability and oversight”.
“The Coalition Government is committed to delivering a more efficient and effective IT service than that which we inherited from the previous Labor government,” he said.
Edited at 7.30pm: This story originally indicated that the Victorian Government had decided to appoint an administrator for CenITex, in accordance with advice from a spokeswoman for the Premier. She has since informed iTnews that the Government has yet to make the decision.