Merger with NICTA must not come at the expense of CSIRO jobs

The CSIRO Staff Association has expressed concern over reports that up to 200 jobs might be at threat due to a planned merger between CSIRO’s Digital Productivity Flagship and NICTA, Australia’s Information and Communications Technology Research Centre of Excellence.

“There should be no job cuts or involuntary redundancies of CSIRO Digital Productivity staff as a result of the merger,” said Staff Association Secretary Sam Popovski.

“Only last November we saw the loss of 25 Full Time Equivalent positions from the Digital Productivity Flagship, resulting from the Federal Governments deep cuts to CSIRO funding,” he said.

Merger prompted by Government cuts

Last year’s Federal Budget – which featured brutal cuts to CSIRO funding and hundreds of job cuts – also included a decision to stop funding to NICTA in June 2016; prompting the merger talks.

“The Government is seeking the merger, so it should be fully funded in order to retain NICTA staffing levels going into CSIRO,” Mr Popovski said.

Staff Association Secretary Sam Popovski wrote to Chief Executive Larry Marshall in February, requesting an immediate commitment from CSIRO Executive to maintain or increase staffing level within the Digital Productivity Flagship and to only agree to a merger or new entity if the project was fully funded by the Federal Government.

The letter also called for progress only to occur if the “merged or new entity (guarantees) the employment conditions of CSIRO staff, including job security, pay, rights and all entitlements.”

“We believe that NICTA staff going into CSIRO should be employed on the CSIRO Enterprise Agreement,” Mr Popovski said.

CSIRO Executive Director Dr David Williams responded in March and while unable to offer any specific or detailed commitment, assured the Staff Association that “the interests of our staff as well as CSIRO’s strategic goals are the highest priorities for the CSIRO Board and this has been made clear to the team working on this activity.”

Newco

In April the integration teams from both organisations released a statement of intent outlining the merger proposal between NICTA and CSIRO’s Digital Productivity Flagship, with the working name of Newco.

With the stated objective of creating an “internationally recognized (sic) enduring Australian ICT powerhouse capability, with the critical mass to have real impact both globally and in Australia,” the paper sets out the structure of Newco, which would “operate as separate independent business unit within CSIRO” with it’s own Chief Executive.

The statement proposes that Newco would be established from 1 July 2015 with its own Chief Executive, management team, business plan and advisory structure “that is separate from a NICTA revised Board.”

However CSIRO’s Digital Productivity Flagship and NICTA would remain as “separate legal vehicles for funding aspects” and only establish a single entity once “the uniqueness and culture for NICTA to succeed” had been established by the new leadership team.

In a nod to the influence of Dr Marshall, the paper also calls for Newco to establish a “deep and tight linkage” to California’s Silicon Valley so the organisation can develop intellectual property that is “leading edge.”

Jobs threat

According to the statement of intent, Newco aspires to be financially stable in sometime in 2018-19. However the paper warns that to do this the merged entity will need not only to attract additional funding from the Federal Government but also by “reducing overhead costs/charges through efficiencies and consolidation synergies.”

Support roles appear to be the jobs most at threat. “There are a lot of areas of overlap in the support functions—HR, finance, marketing and so on,” Dr Marshall told Senate Estimates in June.

“It is inevitable, going forward, that some of those people in support functions will lose their jobs,” Dr Marshall said.

“The situation is that over the next 12 months they will lose about 25 per cent of the total budget for the two entities, and that could translate in the worst case to over 200 people. We are working on areas of saving costs and we are working on areas of extra revenue to try and reduce that to the lowest possible total,” Dr Williams said.

Mr Popovski said that any further CSIRO job losses – given the loss of 1 in 5 CSIRO jobs in the past two years – would be unacceptable and blame would fall to the Federal Government.

“The Government has a clear responsibility to stump up the cash to make the merger a success – it was their own decision to cease all funding to NICTA from June 2016 that prompted this situation.

“This merger cannot come at the cost of more CSIRO jobs.

“If Industry Minister Ian Macfarlane announces the merger and there’s no additional funding attached that’s a red flag for more science job cuts down the track,” Mr Popovski said.

Where to from here

The Staff Association understands that while CSIRO approval for the merger is in place – Dr Marshall describing it as “wonderful opportunity” to create an “ICT powerhouse” – progress from NICTA’s end is running behind schedule and still requires the formal assent of the board.

“It remains to be seen if Minister Macfarlane will be in a position to make any sort of announcement later this month, as was originally expected,” Mr Popovski said.

Previous NICTA Chief Executive Hugh Durrant-Whyte resigned in November 2014 amid reports of a rift with the Board and following a visit earlier that month from German Chancellor Angela Merkel after the Brisbane G20 meeting, which the Federal Government reportedly opposed.

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