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"Public sector values and the relationship between the APS and the public"

Talk to 15th Annual Government Business Conference, Queensland

Andrew Podger*
23 May 2003

1. Introduction

The theme for this conference is "Positioning our agencies for tomorrow's community".

For me, it resonates well with international interest in public sector renewal and, in particular, with our relationship with the public.

Last year I attended the biennial conference of the Commonwealth Association for Public Administration and Management, which focussed on "Creating Self-Confident Government". Some key characteristics of self-confident government emerged from our discussions:

Community participation is not an entirely new priority for government and public administration. The Coombs Royal Commission Report in 1976 essentially had 3 themes: increased responsiveness to the elected government, increased efficiency and effectiveness, and increased community participation. Those themes have been pursued consistently for over 25 years.

Perhaps, however, greater involvement of the public as citizens and customers has increased in priority in more recent times, both because of increased expectations amongst a better informed and connected public, and because technology is facilitating more effective engagement.

2. The role of Values

It may be a cliché¢, but there is evidence that the rate of change is increasing. The underlying driver is technology, which is itself feeding faster technology advance through its expanding capacity to analyse data. Technology is, in turn, driving globalisation, competition for increased efficiency and productivity, and increasing public expectations.

In this climate, the pressure is on far more innovation, flexibility, agility, adaptability. All these desirable qualities are likely to be inhibited by top-down management approaches based on centralised and detailed rules.

Around the world, a key challenge for management has been to find new ways of ensuring confidence within devolved, highly flexible systems. What is it that is enduring and that can provide the framework for confidence in the absence of detailed rules and powerful central inspectorates? Increasingly, in both the public and private sector, the answer is seen in relationships and behaviours: the desired culture of our organisation, or "the way we work around here".

In other words, "values".

The CAPAM conference as I mentioned highlighted this. The OECD likewise has been focussing on values-based-management and ethics as critical components of public sector reform. Just this week at a conference in Sydney on HR, I was on a panel with Fred Hilmer, the CEO of Fairfax. He too highlighted the importance of culture and values to the management of Fairfax, particularly what he called the vital 'editorial' values in the company, and the unquestioned commitment of everyone to get out the papers each and every day.

There is in fact a broad interest now in values-based management and a recognition that properly implemented it offers organisations a framework of relations and behaviours within which they can undertake different businesses and respond quickly to changing circumstances. Such a values-based framework has also been shown to increase employee commitment to an organisation and public trust in its activities. Given that values can underpin a whole range of activities and apply across organisational structures they can remain meaningful despite changing external environments or operational and regional differences.

I met Professor Lynn Sharp Paine of the Harvard Business School in Hong Kong last December. She points to a range of drivers motivating companies around the world to become more attentive to their stakeholders and more concerned about the norms that guide their behaviour, including that high ethical standards are correlated with better financial performance, building customer trust and attracting and retaining the best employees. Paine argues that the ethical commitments of an organisation should contribute to greater employee engagement and creativity. Paine also describes an approach, which she terms a 'value shift', that is suited to what she sees as the corporation's contemporary role in society, an approach aimed at melding high ethical standards with outstanding financial results. She suggests that the superior performers of the future will be those companies that can satisfy both the social and financial expectations of their constituents.

What intrigued me when we shared a platform on ethics in Hong Kong was the synergy between her work on the private sector and our work on the public sector. We saw similar benefits in a values approach, but also similar dangers if the approach is not "hardwired" into the organisation's systems and processes and leadership behaviours. I'll return to this point later.

3. The APS Values

All OECD countries publish a set of core values for guiding their public servants in daily operations, and the various global pressures they all face have led to many updating those values in recent years. But Australia is ahead of most other jurisdictions in not only articulating Values for the public service, but making them the centrepiece of our legislation in place of central controls and a central employer. In our system, agency heads are the employers, and the role of the Public Service Commissioner is not to set detailed rules, but to promote the Values and to provide quality assurance that the Values are being upheld.

The fifteen Values set out in the Public Service Act are not ranked or grouped in any way, and are therefore not very user friendly. We in the Commission have found it useful to group them around key relationships and behaviours, as this is in essence what we mean by Values. The grouping we use is as follows:

The Values that concern our relationship with the Government and the Parliament are the textbook principles that define our role in the Australian democratic system - apolitical, impartial, professional; responsive to the elected government; and openly accountable within the framework of Ministerial responsibility to the Government, the Parliament and the public.

It is important to note that the Values are not just rhetoric. They are in law. Sanctions are available for breaches of the Code of Conduct which includes the requirement for all APS employees to uphold the Values. Agency Heads are required to promote as well as uphold the Values. And the Public Service Commissioner's first two functions under the Act are to evaluate the extent to which Agencies incorporate and uphold the Values, and the adequacy of the systems and procedures in Agencies for ensuring compliance with the Code of Conduct. The Commissioner is also required to report annually on the State of the Service.

A key challenge for the Commission and all APS Agencies is to "hardwire" the Values, so we can be confident they are, and will continue to be, upheld.

The APS Commission is well advanced on a project with the purpose of developing a good practice guide to help Agency Heads and senior managers embed the APS Values into their agency's systems, practices and behaviours.

The project involved inviting six agencies (Defence, Centrelink, AGs, ABS, Transport and ITSA) to participate in an evaluation of the means by which the APS Values and Code of Conduct are embedded in their agencies. The purpose of the project was to use the experience of those agencies in relation to promoting and upholding the APS Values to produce the guide, which would be useful for all APS agencies. As part of this process the APS Commission also conducted a comprehensive literature review and drew on its own knowledge and experience in this area.

The key message that is evolving from the conclusions of the project is that a strategic and integrated approach in required to embed the Values into agencies systems, practices and behaviours and the ingredients of such an approach would include, amongst others, the need for effective leadership and learning and development strategies; hardwiring the Values into instructions and guidance and effective control and assurance mechanisms.

Interestingly most employees consulted in the six agencies participating in the project considered that grouping the Values is a useful tool in helping them to understand the Values and in making them relevant to their jobs. In short they felt that grouping the Values helps to make them 'come alive'.

Agencies rightly focus on particular values and behaviours that are critical to their business, or that require priority attention because of evident problems. But we are keen that they do this in a way that emphasises the statutory obligation of all APS employees to uphold the APS Values, and the centrality of our relationships with the Government, the public and in the workplace, and of our ethical behaviour.

4. Values and our Relationship with the Public

The key APS Values that concern our relationship with the Australian public are:

(g) the APS delivers service fairly, effectively, impartially and courteously to the Australian public and is sensitive to the diversity of the Australian public;

(m) the APS provides reasonable opportunity to all eligible members of the community to apply for APS employment.

Other Values are also relevant, including our apolitical role, our open accountability, and the requirement for highest ethical standards. The fact that the requirement to be responsive to the elected Government includes providing "frank, honest, comprehensive, accurate and timely advice" also implies, in my view, knowledge and understanding of the views of our clients and stakeholders.

The Code of Conduct also sets out clear obligations about our relations with the public. This includes behaving honestly and with integrity, acting with care and diligence, treating everyone with respect and courtesy, complying with the law, disclosing and taking reasonable steps to avoid conflict of interest, not providing false or misleading information, and not making improper use of information or position in order to gain a benefit or advantage for the APS employee or any other person.

To help "hardwire" these Values, and ensure compliance with these Code of Conduct provisions, let me address some of the key practical challenges we face.

(a) Stakeholder engagement in policy development

As I mentioned, a key theme since the Coombs Royal Commission in the 1970s has been the need to increase community participation in the administration of government. I think we would all agree that in a democracy, the executive arm of Government has a clear responsibility to communicate effectively with a wide range of groupings including industry, the media, community groups and not least, directly with the people the Government ultimately serves.

To be effective, this communication needs to go beyond the simple provision of government information and become a dialogue, providing at the minimum useful feedback on government programs and services and promoting discussion about anticipated changes to those programs and policies. Let me focus for the moment on the policy process.

I am of the view that there is a communication cycle that complements the policy cycle. That is, a good understanding of external views is important to a Department's policy development and program management processes, while external groups and individuals need to understand government programs and policies to be able to provided necessary feedback.

At a recent National Institute for Governance Conference "Facing the Future: Engaging Stakeholders and Citizens in Developing Public Policy" Dr Richard Curtain, Co-convenor of the Australian Public Policy Research Network, argued that citizens as individuals can bring three perspectives to bear on a policy issue. The first is as taxpayers who must pay for the cost of public policy decisions, the second is as consumers or users of government services and the third is as members of a community, local or national.

In this current age it is clear that people are better educated and technology provides them with easier access to information and better opportunities to have their say. There is also evidence that people are more attuned to government policy making and more interested in contributing to such processes.

This was borne out in the Government's consultation process on the development of the 2001 White Paper on Defence. Defence developed a Public Discussion Paper that outlined for all Australians the concerns that were confronting us and used this as a catalyst to engage the public. To harness the public interest and to encourage active input into the decision making process, a Community Consultation Team was appointed, led by the Hon. Andrew Peacock AC.

That team travelled the length and breadth of the land, talking with Australians in town hall meetings, listening to their views, and encouraging written submissions. The Department found the overall public response to the White Paper gratifying. More than 2000 people attended the public meetings, nearly 1200 submissions were received (well over 80% of those being from Australians in their private capacity); over 100,000 web site visits were recorded; they fielded over 3500 phone calls and sent out nearly 20,000 copies of the discussion paper.

The importance of consultation and engagement with stakeholders continues to grow and as such there is a need for more expertise and sophistication within the bureaucracy. From personal experience, I am aware of the investment Health has made into this field; FACS is another agency which has substantially improved its two-way communications capacity in recent years. Having said this, in considering processes for engaging with stakeholders, public servants need to keep in the back of their mind our obligation under the APS Values to be impartial, responsive to the government, and accountable, where the formal line of accountable is the Government, the Parliament and the public within the framework of Ministerial responsibility.

The APS Value of responsiveness to the elected government includes the need for our advice to be frank, honest, comprehensive, accurate and timely. In my view that requires us to understand the different values and perspectives of our stakeholders and clients, while appreciating also the barrows being pushed by particular interest groups including some NGOs and community groups. We need to be able to convey the various perspectives accurately to Ministers and to advise how they might best be addressed.

(b) Service Delivery

Let me turn now to how we should engage closely with our customers and stakeholders in service delivery.

Others have spoken at this forum about the important role of service charters. Complaints systems can also provide regular feedback and contribute to improved policy and program management. As mentioned, many agencies are also developing sophisticated systems for two-way communications with customers and stakeholders, which contribute substantially to both policy design and implementation arrangements.

In our study on embedding the Values and the Code of Conduct into agencies, we found some outstanding examples of agencies engaging with the public, listening to their clients and seeking to be more responsive.

Centrelink, in particular, has put a good deal of energy into becoming a leader in Service Delivery. The entire organisation is customer focused and driven. Within Centrelink there is a Chief Customer Officer, Customer Champions to further the cause of improved customer service, staff name badges and widespread use of the work 'customer' in corporate designations. Centrelink prides itself on listening to its customers not only through traditional mechanisms such as consultative groups and through the monitoring of complaints, but also through regular customer surveys by market research companies and through Value Creation Workshops. These are structured forums where Centrelink staff can hear the values and concerns of their customers and sometimes their representatives.

Centrelink is also working toward making services more accessible to the public, in particular by providing access points which are self-help facilities for customers. Customers have access to a dedicated phone, fax and photocopier, relevant brochures and forms to assist them in completing their business with Centrelink or related to Centrelink.

Centrelink also works hard at community engagement. It has developed software for use by local managers which records interactions between Centrelink staff and business and community leaders. Centrelink has also developed a range of local and other partnerships (for example, with universities, with hospitals and local community groups and leaders) and increased involvement with various special needs groups. These complement their Service Charter and systematic feedback from formal decision-review systems.

A small agency, the Insolvency Trustee Service Australia (ITSA), has established a Bankruptcy Reform Consultation Forum with key stakeholder groups, it also consults at the local level with professional groups on practices, procedures and service levels, it has developed national standards for bankruptcy administration with practitioners, and it edits a journal on New Directions in Bankruptcy with the content provided by practitioners. ITSA also has a regular client opinion survey and a system of regular analysis of complaints, as well as a Client Service Charter.

(c) Diversity in the APS

The APS Value relating to service delivery require the APS to be sensitive to the diversity of the Australian public. APS employees also have responsibilities that relate to workplace diversity under the Code of Conduct. When acting in the course of employment, APS employees must also treat everyone with respect and courtesy, and without harassment. They must, at all times, behave in a way that upholds the APS Values and the integrity and good reputation of the APS.

Our study has again identified examples of agencies actively promoting this particular Value of diversity.

Centrelink recruits with the objective of achieving an employee profile that reflects the community profile. Workplace diversity principles are included in contractual arrangements with recruitment consultants and it has identified recruitment targets for specific diversity groups. It has also developed a Multicultural Service Strategy to meet current and future needs of customers from diverse and linguistic backgrounds. Its Indigenous Servicing Strategy complements a statement of commitment to reconciliation and identifies goals and strategies including the set up and enhancement of specialised Indigenous Call Centres providing culturally appropriate services to Indigenous customers.

I am also aware of initiatives in agencies outside those participating in our study. The Australian Quarantine and Inspection Service is breaking new ground in its collaborative work with remote Aboriginal and Torres Strait Islander communities across northern Australia. Indigenous quarantine staff are employed on all of its 14 island locations in the quarantine regions in Torres Strait, and at Bamaga on the northern tip of Cape York. Community ownership of activities in the Torres Strait has translated to a high level of quarantine awareness and support in the Torres Strait that in turn has benefited all Australians by minimising incursions of exotic pests into Australia through this potential transit route.

(d) Decision-making

Fundamental to upholding the Values is the quality of the decisions we make that affect the public. The requirement of impartiality, and of compliance with the law, is not just a matter of meeting the requirements of the various laws each of our Agencies is responsible for (e.g. social security, or taxation or health), but of meeting the requirements of administrative law and the panoply of associated case law. For example, the ADJR Act sets out what is not acceptable in decision-making. APS employees must not:

Dale Boucher, the former CEO of the Australian Government Solicitor, has also highlighted that the legal obligations of a lawyer representing the Government are greater than those of lawyers representing private organisations or individuals. In effect, our lawyers represent Australia, and the obligation for the highest ethical standards requires us to be model litigants, not to defend cases when we know we were in the wrong, not to pursue damages when we know the other party was not at fault, and so on.

Quality decision-making should also draw on the growing body of material on good administrative practice. This includes ANAO reports and better practice guides, Management Advisory Committee reports, Commission guides and reports, Ombudsman's reports and externally driven research and evaluation. Amongst the themes in this material are the importance of evidence, systematic information support and proper record keeping, and careful risk management.

(e) Accountability to the public

An increasingly important area of service delivery concerns the role of contractors providing services to the public on behalf of APS agencies.

An important part of the government's public service reforms has been to bring the specialist skills and knowledge of the private sector and the community to bear in delivering the outcomes required of the public service through contractual arrangements. But increased contracting with the private sector and community organisations has introduced new levels of complexity and risk to public service agencies and presented challenges for accountability.

The Commonwealth Procurement Guidelines make clear that regardless of who is performing a function, if it involves public expenditure, contracting agencies remain accountable to government for that function. This message has also been reinforced on a number of occasions by the Auditor-General.

The public expects public servants to act ethically and fairly. Moreover, high ethical standards support good procurement outcomes.

Generally speaking, the APS Values and the Code of Conduct are particularly pertinent where services are being delivered by contractors to the public on behalf of the APS. However, not all of the Values and the Code are relevant even in these circumstances. The values relating to service delivery are critical, as is part of the APS Value relating to responsiveness to government in implementing the government's policies and programs. At the same time, Values applying to the Service's internal workplace relationships are not relevant to contractors' own employment practices, although other Commonwealth employment legislation, such as occupational health and safety and anti-discrimination will apply.

Additionally, the Privacy Act 1988 has been amended so that since December 2001, each agency is required, when entering into a contract on behalf of the Commonwealth, to ensure that the contract does not authorise the contracted service provider, or a subcontractor, to do an act or engage in a practice that would, if done by the agency, breach the Information Privacy Principles.

Agencies need to take steps so that tenderers are aware that the APS employees are bound by the Values and the Code and do not place public servants in a position where their impartiality or professionalism may be compromised. As well, any action that would give rise to a real or apparent conflict of interest on the part of the agency decision-maker must be avoided. Agencies must also take steps to ensure that key public service decision-makers in a tender process are not immediately employed by a successful tenderer. Agencies are accountable to the Government and Parliament through their Minister for their decisions and may also be required to justify their decisions and process through the courts if challenged, for example by another tenderer.

Some agencies have developed common understandings of ethical behaviour with relevant industry associations. The Department of Defence some time ago developed a statement providing guidelines for ethical behaviour appropriate to its business dealings. As well as raising staff awareness of the issues involved, the statement provides industry with guidelines on what to expect when doing business with Defence. The document aims to provide a practical recognition of the aims of both industry and Defence, the constraints affecting each, and their mutual obligations. The statement is currently undergoing a review which will bring it up to date with present legislation, particularly the PS Act and the APS Values and Code of Conduct.

A Service Charter also provides a powerful performance measurement and accountability tool. By setting out the standards of service customers can expect they have had a significant impact on service standards and agency efficiency in many organisations.

Agencies achieving recognition in last year's Service Charters-Awards for Excellence scheme were the Child Support Agency for its comprehensive approach to business management, demonstrated by strong links between customer knowledge and business systems, advances in technology and client feedback. It was also recognised for particular achievements in the delivery of services to rural, regional and remote Australians. Comsuper and the Health Insurance Commission also received awards.

Nevertheless, Service Charters are of limited effect if they do not include service standards which are measurable and which are actually measured and reported against.

Other agencies have signalled a strong commitment to accountability to the public and in particular to parts of the Code of Conduct relating to the requirement for APS employees to behave honestly and with integrity, and not to make improper use of inside information.

The Australian Bureau of Statistics is obliged by the Census and Statistics Act 1905 to publish and disseminate compilations and analyses of statistical information, and to maintain confidentiality of information collected under the Act. The ABS recognises, however, that confidentiality and secrecy of information must go beyond mere compliance with the legislation. As well as requiring new starters to sign an undertaking of fidelity and secrecy, the importance of confidentiality is reinforced in induction programs, management development programs and through on-line resources. The ABS has also invested in strong physical and information technology security systems and has well defined policies on data retention. The ABS views its approach as fundamental to ensuring the trust of providers. Without the trust of providers the capacity of the ABS to operate effectively and to achieve its mission would be considerably hampered.

All these are examples of "hardwiring" the APS Values on relationships with the public into Agency systems and procedures. The best areas are not in the form of detailed prescriptive rules issued by Agencies that replicate the central rules we got rid of; rather, they involve clarification of principles, and guidance for sound decision making, and good management practice.

5. Conclusion

The Conference program sets out two questions for me to answer in this session:

"Do Values contribute to influencing relationships with our Clients"? Yes. Indeed they must do, because by their very nature values are about key relationships and behaviours. The success of that contribution depends critically upon the "hardwiring" of the Values into Agency systems and procedures.

"Have we Got Them Right?" Well, the Parliament set them in the Public Service Act in 1999, with bipartisan support. They are our riding instructions, with the full weight of law. The question is not whether they are right, but whether we are upholding them consistently and effectively in each of our businesses.

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