The Budget and the APS

Nov 6, 2022
Close up picture of Australian banknotes and coins on a wooden table. Currency and money from Australia

The budget papers reveal considerable action to progress the Albanese Government’s APS reforms recently set out by Katy Gallagher. However, not all of the budget measures are clear yet, some are questionable and there remain important measures still to be pursued.

Budget Paper 4, Agency Resourcing, has a preface by the Minister for Finance, the Minister for Women and Minister for the APS (Senator Gallagher), repeating her four APS reform priorities, that the APS:

  • Embodies integrity in everything it does;
  • Puts people and business at the centre of policy and services;
  • Is a model employer; and
  • Has the capability to do its job.

Integrity

On integrity, the minister refers enthusiastically to what is in fact a rather vacuous Secretaries’ Leadership Behaviour Charter. Fortunately, she also draws attention to substantial measures including the proposed National Anti-Corruption Commission and the codes of conduct for ministers and ministerial staff.

She might also have mentioned the review of the MOP(S) Act and the Joint Select Committee on Parliamentary Standards which hopefully will propose statutory codes of conduct for MPs and the different categories of MOP(S) Act employees, clarifying their respective roles and lines of accountability. She does allude to more work on values, hopefully this will include adding merit to the core APS Values and articulating values and codes of conduct for non-APS Commonwealth employees.

Putting people at the centre

On putting people and business at the centre, the Budget fortunately does much more than the minister’s opening references to the proposed Charter on Partnerships and Engagement.

It includes extra resources for frontline services in the Department of Veterans Affairs (rising to $66 million a year), the NDIA (rising to $45 million a year) and Services Australia ($25 million a year). (The extra for Services Australia, however, seems to be more than offset by the reduction in staffing for COVID activities.) There are also extra resources for face-to-face services in regional Australia and for Closing the Gap.

On the other hand, the minister also highlights the highly questionable new Buy Australian Plan.

A most interesting reference is to the intention for the APS to develop ‘Insight briefings’ in consultation with the community and external experts, an idea presumably borrowed from NZ that complements the NZ Treasury’s equivalent of our InterGenerational Report. Watch this space as the Government explores a ‘wellbeing’ approach to future budgets and a new IGR next year.

A model employer

The main measures mentioned under being a model employer relate to diversity. The targets for Indigenous employment (5%) and employment of people with a disability (7%) are ambitious but appropriate; I am less convinced that priority should continue to be devoted to women’s employment when women now dominate the APS at nearly all levels and the current momentum is certain to add to that.

Surprisingly not mentioned by the minister is the Government’s action to review how pay and conditions are set (the Budget presumably includes provision for the announced interim 3% pay increase though this is not specifically identified). This is a critical issue that will require a lot of effort over the coming years, starting with a serious study of APS workforce needs and the occupations and career paths to support them (not the recent simplistic Classification and Hierarchy Review), followed by relevant market comparisons and then a transition plan to achieve alignment over time. This is essential to ensure the APS attracts, develops and retains the skills it needs.

Capability

While not mentioning pay, the minister does rightly emphasise the role of systematic evaluation in enhancing capability, as well as the (Morrison Government announced) reintroduction of capability reviews, the APS Academy and the introduction of ‘professions’ streams.

The Budget itself includes additional resources for the APSC (mostly from previous budget decisions) and PM&C. While the extra 70 ASL (staff) for the APSC may be justified, I am less convinced that PM&C needs an extra 100 ASL, particularly given greater pressures on other agencies.

Where more resources have been allocated (such as for frontline services and PM&C), the Budget Paper indicates that these have been funded at least in part by savings elsewhere. Exactly how is not clear, which may explain why PM&C indicated in Senate Estimates last week that more work needs to be done to settle agency resources.

In fact, the Budget evidently retains existing ‘efficiency dividends’ from departmental expenses and then applies additional savings from expected reductions in consultants, contractors and travel etc. While reduced use of consultants and contractors is welcome, it is hard to see how the overall tightening of most agencies’ budgets will lead to improvements in capability. And we are yet to see the results of the IT audit announced nearly three years ago and how capital investments are to be made in the future (though the budget does include a few new IT investments).

Clearly, more work needs to be done to sort out agency resourcing as well as pay and conditions if APS capability is to be repaired.

Missing APS reforms

While the Budget does reveal a start on APS reform, the Government has yet to indicate its view on some of the most critical issues, particularly surrounding the respective roles of the APS Commissioner and the Secretary of PM&C, and the related issue of strengthening the merit basis for secretary and other agency head appointments (and appointments to boards and tribunals etc.).

Let us hope that these reforms are not being quietly set aside.

First published in The Mandarin Nov 01 2022

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