Regional towns hoping to win jobs from the Coalition's push to decentralise the public service have copped nearly 2000 job cuts since the government started downsizing its agencies, new estimates show.
The government has shed more than 1800 staff working in the bush mainly through efficiency dividends since 2013, according to figures compiled by the main public sector union.
A Coalition push to decentralise part of its public service workforce has raised the hopes of struggling regions after they were invited to pitch for jobs that could be shifted from Canberra, Sydney and Melbourne.
But the workforce of public servants has shrunk 15 per cent since 2012 across regional areas analysed by the union, which said losses reached as high as 33 per cent in the Darwin statistical area, 28 per cent in Logan-Beaudesert, Queensland and 25 per cent in south-east Tasmania.
North-west Victoria (23 per cent), Mackay (14 per cent) and the Murray region in NSW (16 per cent) were among several others sustaining significant cuts to their ranks of public sector staff.
Australian Public Service Commissioner John Lloyd disputed the figures, saying regional APS employment had in fact grown since 2012.
But data from the public service commission's yearly reports indicate APS employment in the regions shrunk in the four years to 2017.
The Community and Public Sector Union said job losses amounted to $449 million lost from the regional economy.
It used the figures to tell a parliamentary inquiry into the controversial decentralisation project that the Coalition should improve employment in bush towns by reversing the cuts, and prioritising regions for new jobs.
"The public sector is itself in need of urgent repair, as decades of public sector cuts have left the APS understaffed, under resourced and with a degraded policy development and service delivery capacity that has a substantial negative impact on the community, and on regional communities in particular," it said.
"Moving agencies, functions, and staff to new locations does not rebuild APS capacity, and risks exacerbating the problem."
The union said the government had raised false hopes among towns that they could host departments and agencies, referring to regions that have made bold pitches for leading government bodies including the Department of Foreign Affairs and Trade.
It rejected the Coalition's policy, saying it failed to increase APS employment enough to rebuild its capacity, was less cost effective, risked damaging agencies, and could bring unacceptable personal costs for staff.
The government should increase its regional presence by establishing new agencies in the bush, the CPSU said.
Defending Canberra as the centre of the public service, it said co-locating key agencies was needed for them to collaborate and recruit experienced staff.
"Treating the public sector solely as a new source of economic stimulus for struggling communities ignores both the public policy objectives of the work and the benefit of maintaining a centre of excellence in public administration in the national capital.
"Being located in the national capital ensures a responsive and more collaborative public service that is focused on the national rather than sectional geographic interests."
The government should use an independent framework for locating new work in regional areas to prevent pork-barrelling, it told the inquiry.
Mr Lloyd said the composition of the APS workforce was "always changing."
"Staff numbers are not static and are subject to change based on workforce needs," he said.