Pearls and Irritations

At his valedictory event, former APS Commissioner, Peter Woolcott, suggested that the Government and APS leadership were now pursuing ‘Thodey on steroids’. Some have endorsed that view referring to the partnership between Glyn David and Gordon de Brouwer as the ‘dream team’, now further consolidated by de Brouwer’s appointment as the new APS Commissioner.

So it is perhaps timely to do a stocktake of the action taken so far on the Thodey report’s recommendations, taking into account the recommendations agreed back in 2019 by the Morrison Government, the pre-election commitment by Albanese to revisit the recommendations not agreed, and the Albanese Government’s reform measures set out most recently in Minister Gallagher’s Preface to Budget Paper 4.

A further and wider stocktake will be needed after the Robodebt Royal Commission reports in July. While the Secretaries Board has established an Integrity Taskforce to examine issues revealed during the Commission’s hearings, its terms of reference do not cover all the issues the Commission asked me to report on earlier this year.

Recommendations agreed by the Morrison Government

The following reviews the recommendations agreed back in December 2019 and the action since taken, grouped around the Thodey Report’s themes.

The report’s opening theme, to ‘deliver better outcomes’, provides the overall context of both continuity and change without specific recommendations.

The recommendations to ‘transform for the future’ (R1, 2, 3 and 4), focusing on management of reform, were all agreed. While the Secretaries Board has been coordinating implementation of the reform agenda, there have been no regular reports of progress. A new round of capability reviews is finally underway using an improved framework, and the citizens’ survey to monitor public views of APS performance is being conducted regularly. But it is hard to see progress on building a culture of ‘openness, innovation, collaboration and partnering’. The emphasis on being ‘united to serve all Australians’ seems to me so far to involve more speaking with one voice and deference to the APS leadership than encouraging openness and different perspectives or recognising different areas of expertise or promoting contributions by junior and middle level staff.

The recommendations to ‘unite to succeed’ (R 5, 6 and 7) were only agreed in part, the then Government not agreeing to amend the Public Service Act to strengthen the powers of the APS Commissioner. The remaining agreed measures are somewhat rhetorical, but even the questionable ‘inspiring purpose and vision’ (R6) has yet to emerge (though it remains on the current Government’s agenda).

Recommendations to ‘partner for greater impact’ (R8, 9, 10, 11 and 12) were at best only agreed in part. Essentially, the Morrison Government stood by its existing approaches to engagement and participation, but there is little evidence these have been pursued with any vigour (little has been said since 2019 about the then new ‘Framework for Engagement and Participation’).

Most progress has been made on the recommendations to ‘embrace data and digital’ (R 13, 14, 15, 16, 17 and 18) which were mostly agreed in full. The 2021 Digital Review was in line with the recommended audit of ICT investment and has been followed by an initial Data and Digital Government Strategy released recently by Minister Gallagher with a view to a final strategy by the end of 2023. The 2023-24 Budget also includes substantial new investments, but the outcomes will not be known for some time. Progress has also been made to build data and digital professions.

Progress on the recommendations to ‘invest in people to strengthen credibility’ (R19, 20, 21, 22, 23, 24, 25, 26, 27 and 28) that were agreed is mixed; lack of agreement to key parts of some proposals hampered how much could be done. The APSC published its APS Workforce Strategy 2025 in March 2021 and subsequently conducted some specific skills forecasts; it also advises agencies on workforce planning. I am concerned, however that the strategy – and the Thodey Report – gives too much emphasis to mobility and not enough to depth of expertise. That said, the ‘professions model’ is being introduced to promote some specific skills.

There also seems to be better cooperation around recruitment and induction, and in succession management for senior positions. And the APSC has also established its Academy promoting public service ‘crafts’ amongst junior and middle level staff.

Progress on recommendations to ‘develop a dynamic and responsive organisation’ (R29, 30, 31, 32, 33, 34, 35 and 36) is also mixed, hampered by key aspects not agreed and by questionable elements of Thodey’s recommendations. Morrison claimed his machinery of government changes enacted in early 2020 delivered the proposed review of the number of departments and agencies, but those changes hardly provide a model for the future, exacerbating confusion over lines of authority and accountability between ministers and departments. The APSC-sponsored review of hierarchy and classification proposed changes was also disappointing: if implemented (and fortunately the Albanese Government has not agreed to do so) it would likely exacerbate classification creep and undermine clear lines of program responsibility. So there remains a lot to do in this space.

Few of the recommendations to ‘empower leaders’ (R37, 38 and 39) were agreed, though the APSC was provided some more funds through the Secretaries Board. I remain uneasy about giving the Secretaries Board more authority, preferring to see secretaries working together under the PM&C Secretary to respond to the PM’s, Cabinet’s and Cabinet committees’ agendas, and for a separate Management Advisory Committee supporting the APS Commissioner.

Recommendations not agreed by the Morrison Government

The following examines the most important of the Thodey recommendations rejected by Morrison and the Albanese Government’s response to them so far.

Thodey recommended a number of important changes to the Public Service Act, all of which were rejected by Morrison. Sadly, at this point, the Albanese Government has not addressed most of them. The only one being actively pursued relates to R5, that the PS Act include a set of ‘principles’ as well as the APS Values, and that one of these be ‘stewardship’. Minister Gallagher proposes instead to add ‘stewardship’ to the APS Values. R5 also proposed that the principles and values extend to Commonwealth agencies beyond the APS, and Gallagher has proposed that the APS Values be applied beyond the APS.

Both the Thodey and Gallagher lines present serious problems. Adding ‘principles’ as well as ‘values’ would surely be confusing, as I believe it is in NZ where the idea comes from. On the other hand, it is noteworthy that the NZ legislation does not require all public servants to uphold the principles, but implies that they are the responsibility of senior public servants. That makes sense: stewardship is not a value but a function, one that senior public servants (and ministers) should be held responsible for. Our PS Act already makes secretaries, and the Secretaries Board, responsible for stewardship, and this responsibility should be extended to the SES (who are already required to promote as well as to uphold the APS Values) and to ministers.

As I have written elsewhere, extending the coverage of the APS Values may not always work. A much better approach is to use value statements that reflect the different roles and responsibilities of different components of the Commonwealth – the APS, the Parliamentary Service, ministerial staff, other staff of MPs, GBEs etc. This strongly suggests, not the introduction of new principles for the APS, but some recasting of the current Values to reflect more firmly Westminster principles including in particular merit.

Of most concern is that Gallagher has not yet clarified the Government’s position on other recommended changes to the PS Act including in particular:

• Strengthening the powers of the APS Commissioner (R7);
• Clarifying the distinct roles of the Secretary of PM&C and the APS Commissioner (R38)
• Strengthening the merit-based processes for appointments and termination of secretaries (R 39a and 39c);
• Consulting the Leader of the Opposition before the appointment of the APS Commissioner (R39a).

No references to these recommendations appear in her statements nor on the PM&C website. Sadly also, the opportunity to consult Opposition Leader, Peter Dutton, on Gordon de Brouwer’s appointment seems not to have been taken.

The Minister has, however, asked former APS Commissioner, Lynelle Briggs, to review the Merit and Transparency Guidelines regarding the appointment of other agency heads and board members.

The Thodey recommendation (R11) to legislate an enforceable code of conduct for ministerial staff does not seem to be on the Government’s public sector reform agenda, though the suggestion has been explored in the context of the Jenkins Review of the Parliamentary Workplace. Jenkins recommended a comprehensive review of the Members of Parliament (Staff) Act which PM&C conducted last year. This could deliver the Thodey recommendation along with other important improvements to ministerial staffing arrangements, but so far the Government has not responded: it needs to be given higher priority within the public sector reform agenda.

More positively, the Government has abolished staffing caps (R19) and begun to reduce reliance on consultants and contractors.

The Government has also taken important first steps to rebuild a culture of evaluation (R26) with the Assistant Treasurer’s (Andrew Leigh’s) establishment of an evaluation unit in the Treasury. Hopefully this will lead to more systematic use of evaluation through Cabinet and budget processes, and to wider publication of research within the APS (R27).

While the Albanese Government’s machinery of government involves less confusion over lines of authority and accountability than the Morrison Government’s, there are still problems and little confidence of fewer MOG changes into the future. As yet, the Government has not agreed to the review Thodey recommended (R30).

First steps have been taken to move towards common pay and conditions across the APS (R33). However, there is a long way to go: identifying distinct occupations, clarifying career paths, setting classification standards, conducting market comparisons and establishing pathways to achieve common remuneration levels. As yet, the APSC has not revealed how it plans to pursue this agenda and the current APS pay offer does little more than kick this can down the road.

The Government has also indicated interest in reviewing the Intergenerational Report under the Charter of Budget Honesty Act (R36). Gordon de Brouwer has also expressed interest in the NZ practice of ‘Insight Briefings’ by departments complementing the IGR, exploring the long-term challenges each department faces. A new book, More than Fiscal  has just been published by ANU Press reviewing the 2021 IGR and offering advice for future IGRs including the one the Treasurer has announced is to be published later in 2023 (I am one of the editors and authors). There seems to be some appetite for action in this area.

Conclusion

Peter Woolcott’s portrayal of ‘Thodey on steroids’ is an exaggeration. There has been progress in many areas, and the Albanese Government has started to address some of the important recommendations rejected by the Morrison Government.

Worryingly, the Albanese Government has not indicated its position on some of the most important of these, particularly those relating to amendments to the PS Act and the MOP(S) Act. While I do suggest some variations to Thodey’s recommendations, action on these is critical to the integrity of the APS and the Government.

Morrison’s frequent references that rejection of these recommendations was ‘on the advice of the Secretaries Board’ is also worrying as it raises questions about the level of support for reform amongst the APS leadership, notwithstanding the views of Glyn Davis and Gordon de Brouwer.

The Robodebt Royal Commission reports in early July. I hope it triggers wide public and Parliamentary demand to advance more seriously the APS reform agenda.

 

Republished from THE MANDARIN May 23, 2023