So-called ethical hackers are being hired by the Federal Government to help test the security of new online systems amid continuing questions about the safety of citizens' information.

The Digital Transformation Office (DTO) is tasked with making government services online more user-friendly but it is also turning its attention to "identity assurance".

"We want to have a way of verifying that people are who they say they are when they deal with governments and we've been asked to do that," DTO chief executive Paul Shetler told the ABC.

The Federal Opposition has been calling for a Federal Police investigation into identity theft and fraud, pointing to reported problems with Medicare claims, the MyGov portal and the Australian Tax Office.

Mr Shetler nominated online security as "probably the most critical part" of his agency's work.

He said ethical hackers were being employed by the DTO to test new systems as they are being developed.

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"This is somebody who's got deep experience... understands potential holes, understands how you can also socially engineer your way into a system, not just on a technology side, but by pretending to be somebody," he said.

"This person's coming into our organisation to go through every single thing we deliver and try to break into it, try to find every single possible hole they can, break it so we can fix it."

The DTO is working on a series of projects across state and federal governments covering areas as diverse as health, citizenship and business registrations.

Mr Shetler acknowledged online services were currently failing the majority of users.

"When they're accessing government services or information, more than 55 per cent of them have a problem, it's not where you want to be," he said.

He said if a company in the private sector had that record it would go out of business.

"I think if government actually had to offer services on the commercial marketplace, yes of course it would. They wouldn't be able to compete," he said.

Ideas for making government services simpler and faster online are developed across the DTO's Sydney and Canberra offices.

Despite the agency's digital focus, hand-written post-it notes plaster the walls of both.

"If you want to actually get ideas down quickly and you want to make them visible to everybody and you want to actually change them - why not write them on a little piece of paper that's colour coded and move them around?" Mr Shetler said.