THE Australian Services Union fears there could be job cuts at VicRoads' Horsham and Ararat customer service centres if the service is partly privatised.
The union, which represents administrative and municipal workers, is campaigning against such a development.
It follows Victorian Treasurer Tim Pallas saying the government would "investigate future options" for VicRoads' registration and licensing division.
"We are undertaking a detailed scoping study... looking at a range of options including the role of Service Victoria and, might I say, the private sector," he told state parliament on October 31, responding to a question from Member for Ripon Louise Staley.
"We are not against working with the private sector to improve services and to benefit motorists."
ASU assistant branch secretary Leon Wiegard said the union was primarily concerned the government had not ruled out job or pay cuts as part of any changes ultimately made.
"Once you start messing with jobs like that, that has a big impact on regional Victoria - so we're concerned about the impact it's going to have on our members and the regional towns they serve," he said.
"I think most Victorians would know when the state government has privatised banks or energy, things have gotten worse, not better, and they've become less customer-focused.
"They have said multiple times they will not privatise VicRoads, but if you look at what they've done with other infrastructure like ports, they've engaged in long-term leasing arrangements so they can technically say they're not privatising, but they're still getting the private sector to run them."
Member for Lowan Emma Kealy said if the government was planning on privatisation, it needed to be clear regional residents would not receive any additional fees and the level of services would continue.
"When you're looking at limiting access to getting a licence renewed or a car registered, it makes a huge difference in those rural communities," she said.
"There is an older demographic usually and people have to travel much longer distances in order to do that same administrative work. The flow-on effect could be quite significant if there is any reduction in the overall staffing support provided to deliver the administrative workload."
Ms Staley said she would keep pressing the government for answers.
A Department of Transport spokesman said the government would not privatise the registration and licensing function of VicRoads.
"It will be business as usual for customers while we await the conclusion of the study," he said.
"In the meantime, the government will work with agencies and unions to ensure we reach the best possible outcome for staff."
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