The Institute of Internal Auditors: Public Sector Internal Audit Conference - "Building a Strong and High Performing Public Service"

Last updated: 03 Aug 2015

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The Hon. John Lloyd PSM
Australian Public Service Commissioner

30 July 2015

Check against delivery


1. The APS has an established reputation of providing effective and apolitical service to the government and the country.

2. Society and government is becoming more complex and significant change is occurring more rapidly. This generates significant challenges for leading organisations that are high performing. A premium is placed on the quality of our leadership.

3. The community wants government services and programs that offer more choice, are personalised, delivered faster and at a lower cost. It is not surprising that the community has this expectation because it reflects their experience with services delivered by business.

Red Tape

4. This morning's first keynote session addressed the issue of red tape reduction. It is a critical issue. Australia rates poorly in world rankings measuring regulatory burden.

5. Excessive red tape impugnes the reputation of the public service and public servants. We are seen as being indifferent to the operating environment encountered by business. Oppressive red tape can weaken respect for the law; many choose to disregard oppressive and intrusive laws.

6. The task to reduce red tape is relentless. Governments want to be seen as active. This often means new laws, regulations, guidelines, licences and accreditation.

7. Internal audit can play an influential role in the red tape reduction effort. One of the frequent areas of complaint when I was Red Tape Commissioner was the difficulty of doing business with government. I was told it cost $10,000 to apply for a $5,000 grant. A $50,000 contract generated a contract in excess of 150 pages. As a result, many companies do not bother to seek government business.

8. Internal audit has a window on many of these inefficient regulatory practices. I anticipate it has the capacity to discover and expose these practices. I am confident internal audit has the ability to recommend improvements to the practices.

9. There are several areas I will talk about. They cover initiatives to achieve a public service that is a higher performing organisation - an organisation that is more agile and responsive to the government and the community we serve.

10. The areas are:

  • A more flexible employment framework,
  • Leadership,
  • Talent management, and
  • Integrity.

Employment framework

11. A more flexible APS employment framework is vital. APS agencies have diverse needs in respect to the capabilities of their workforce. One size doesn't fit all.

12. Our agencies should have the ability to mirror some better and more competitive employment practices in the private sector.

13. Recruitment. The public service needs to be able to attract and retain the best and brightest. To do this we require contemporary recruitment processes which are effective in attracting and selecting good people.

14. Currently, you would be aware of too many recruitment processes that take 12 weeks or more.

15. The best people aren't going to wait 12 weeks.

16. We are working on initiatives to remove unnecessary process from recruitment. You will have a greater capacity to recruit the people you need in a timely manner.

17. The Commission will also examine arrangements for non-ongoing employment. These are highly prescriptive and inflexible.

18. The employment status of staff should better reflect the type of work being performed and the agency's business needs. There are a whole range of areas in the public service that require less fettered access to flexible, temporary, casual, term and contract employment.

19. That said, I understand the need for a strong APS with a stable base of experienced employees.

20. I want to ensure that we facilitate the mobility of staff. Not just between agencies but also with private sector companies.

21. More secondments between the public and private sectors would assist the public service to become familiar with the challenges of doing business in Australia. This would improve our capacity to give policy advice that has due regard to the operational imperatives of business.

22. Likewise, private companies would gain a deeper understanding of the challenges facing government.

23. Encouraging high performance and managing under-performance is another area for attention.

24. Performance assessment and initiatives to enhance employee skills have to be embedded in the culture of agencies. Performance agreements should be concise. Performance feedback should be timely and regular and definitely not left to only an annual assessment.

25. Dealing with underperformance is a continual problem. You owe it to the good performers not to leave it in abeyance. Sometimes the underperformance exercise will be protracted. We are developing options to alleviate the extensive work and delays that are a feature of contested underperformance.

26. There seems to be a lot of people who are stuck in the system - who are not performing or are not able to attend work consistently for an extended period of time. Sometimes this goes on for many months, even years.

27. The rules we have in place in the APS should not hinder agencies in taking the most effective course of action to resolve these long term cases, in the interests of both the individual and the agency.

28. We are examining the avenues of appeal and review in the APS to make sure we have the balance right. Our society has significant protections for all workers in Australia. So it is matter of understanding whether the additional rights of review available to public servants are warranted.

29. The Commission will also review our termination of employment rules to ensure they are consistent with community standards. Procedures which are over engineered have the capacity to harm both the employee and employer interests.


30. I want to address the type of leadership we need for a high performing APS – one that is better able to support the Government's ambitious agenda.

31. We know that management skills alone will not be enough.

32. Don't get me wrong: the exercise of management authority is important in maintaining order, solving technical problems, and ensuring there is accountability for decision making and use of resources.

33. However, these skills will only get us so far as the APS engages with increasingly complex issues.

34. Leadership is also critical if the APS is to continue to evolve, becoming more agile and responsive, and more connected to the real world that it serves.

35. Firstly, all leaders need to be able to think in more complex ways. This includes:

  • having a wide perspective,
  • being able to see more broadly across an issue and make more connections,
  • being able to generate a wide range of options and possibilities, and
  • being open to learning and discovery – complex issues may not be solved by current ways of thinking!

36. Our managers and leaders also need to be able to act more skilfully and flexibly in the interests of making progress on hard issues. This includes:

  • engaging others in the work, including across sectors and constituencies,
  • doing more listening than telling, and asking more questions ,
  • knowing when to collaborate, and doing so effectively when required,
  • understanding and navigating alliances and interests,
  • working well with conflict – indeed inviting divergent views to surface better ways of doing things, and
  • experimenting and adapting as a way of moving towards new solutions.

37. Of course, sound leadership requires a certain resilience and purposefulness to stay steady, and a degree of political nous.

38. I particularly want to emphasise the important role our Executive Level staff in a high performing APS. EL staff are our middle managers and their contribution is critical, although often overlooked.

39. They are:

  • translators, who communicate strategic and operational intent up and down the organisation,
  • risk managers, who are able to identify emerging operational risks and their strategic implication,
  • agents of change, who can refocus operations while maintaining morale and business as usual,
  • role models, who have a powerful influence on culture,
  • relationship builders, who are able to establish and maintain productive relationships inside and outside the organisation, and
  • managers of people and performance, who have a multiplier effect on engagement, capability and productivity.

Talent management

40. It is clear that a high performing APS requires the best and brightest employees.

41. Managing talented employees makes good business sense.

42. I want to ensure that there is a more systematic approach to attracting, identifying, developing, retaining and deploying these employees.

43. It is important that the APS has the right people ready for critical roles now and in the future. Research from the corporate world points to a number of benefits of talent management including:

  • The creation of a robust leadership bench strength that supports the organisation's succession planning for key positions,
  • Improved retention and engagement of high potential employees with business critical skills, and
  • Greater customer satisfaction and overall better performance, compared to organisations that do not actively manage talent.

44. We are engaging with the private sector to learn about modern approaches to talent identification, support and career planning.


45. To be high performing, there is an essential requirement for the APS to keep pace with a fast-changing environment.

46. The APS and Commonwealth employment have a sound record on integrity. We have avoided the well publicised cases of misconduct, unlawful conduct and corruption that have emerged in the states. But we have not been completely free of wrongdoing by employees. We cannot be complacent.

47. Internal audit has an important role to play. Your audit program and activity can obviously uncover improper conduct and practices.

48. Just as importantly you can make suggestions to tighten integrity systems and controls. I encourage you to do that.

49. In the Commonwealth we administer $ billions of transfer payments. We control massive amounts of information. Access to some of this information would be valued by people with criminal intent or criminal connections. The relevant agencies tell us the threats to integrity are not abating and we continually need to update our integrity systems.

50. We have to administer robust and effective integrity systems. We have to be constantly on the lookout to improve these systems.

51. Structural changes to government have to be taken account of. For example, the red tape reduction program combined with the constant demand to satisfy claims quickly introduce risks to integrity. Also, our attention to managing risk is patchy - good in some agencies, poor in others.

52. To give more focus to these issues I have reconvened an Integrity Group.

53. I reconvened the Integrity Group to bring more cohesion across the Commonwealth about how we address these issues. A clear and consistent messaging to staff is very important to combat corruption and mis-conduct amongst APS employees.


54. In summary, there is a real opportunity right now to transform the public service.

55. While I have focused on more structural issues, a cultural transformation is also required. It is up to each of us, no matter where we work, or what we do, to find better, faster and cheaper ways to get things done.

56. Cutting costs without changing the way things are done makes no sense.

57. A cultural change is also required in the way we think about and engage with risk. Risk avoidance is unacceptable. We need to ensure people know what they are responsible for and hold them to account.

58. The APS has served the country well. It is the responsibility of all who work in the APS to ensure its reputation for integrity and high performance remain intact. We are always open to ideas from you about how we can better achieve this goal.