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This overview, of my third and final State of the Service report, offers an opportunity to reflect on Service-wide issues and provide my own perspective on some of the key findings.

THE REPORT’S EVIDENCE BASE

Last year’s report included a new perspective–that of APS employees. This year the report builds on that addition and, in many instances, is able to report time series data. Many of the 2003 and 2004 survey results are remarkably similar, which in itself is a reassuring indication of the robustness of the survey methodology and the survey results overall. Future employee surveys will be able to provide clearer evidence of trends. The views of employees also provide a useful reality check against the perspective reflected in the annual agency survey.

For the first two years of the employee survey, the Commission decided not to identify agencies with relatively poor results. This was both to allow a period to build confidence in the survey methodology, and to ensure support from agency management. I believe it would be appropriate in future years to identify selectively both good and poor performers, still with the clear aim of promoting good performance rather than apportioning blame.

This report has the additional benefit of the findings of a number of evaluations and research projects conducted by the APS Commission during the year. The Commission’s 2003—04 evaluation program was largely informed by last year’s report, and in turn those evaluations inform this report. In particular, we have examined the management of breaches of the Code of Conduct, the content of written Workplace Diversity Programs and agency protocols guiding interactions with Ministers’ offices. We also examined aspects of service delivery, to include the perspective of the public as well as that of employees and agency management, recognising however that this report can never fully assess agencies’ overall program performance. The additional evaluation and research work provides an extra dimension to this year’s report, and I believe the strength of the report is greatly enhanced by it.

This report also draws upon, information provided by public services in other jurisdictions–particularly Australian States and Territories as well as New Zealand–on some of the matters canvassed.

DEVELOPMENTS IN 2003—04

The size of the APS steadied in the last year after three years of significant growth following the previous period of major reductions in APS employment. The Service is around the size it was in 1997, but with a far greater workload across most functional areas.

The feminisation of the Service also steadied, but with continued increases in the representation of women in more senior positions.

The Service is continuing to age. Surveys conducted for the Management Advisory Committee (MAC) organisational renewal project suggest that older workers are willing to stay on longer if agencies can provide them with additional flexibility, ameliorating a little the risk of a sharp changing of the guard. Moreover, trend data now reveals that those who remain in the APS until at least age 55 are staying on a little longer than in the past.

However recruitment of young people, including trainees and graduate trainees, fell sharply in 2003—04, a disappointment given the need to refresh the Service and prepare for a higher departure rate of older workers in the years ahead.

More flexible working arrangements are indicated by increases in part-time work, including amongst older workers, and the greater use of Australian Workplace Agreements. Most employees also report that their managers support flexible working arrangements. The sharp reduction in non-ongoing employment, however, suggests that there remain some obstacles to flexibility in the workplace.

Overall job satisfaction remains at a pleasing level, with the vast majority of APS employees (74%) having reported that, on average, they were satisfied with the factors they nominated as most important to them. The two workplace factors that were rated as most important in terms of impacting on job satisfaction (i.e. ‘good working relationships’ and ‘flexible working arrangements’) received the highest satisfaction ratings (over 80%).

The following summarises developments affecting some of the more important challenges facing the Service.

APS Capability

There is strong evidence that the capability of the Service is continuing to increase, with more tertiary qualified employees, and with more employees having work experience outside the APS.

Many of the current capability issues facing the APS centre around the demographic challenge of the ageing of the APS workforce, including the need to encourage the retention of older workers, the need to ensure that younger workers have the appropriate capabilities to step into leadership and other key roles, and the need to ensure that appropriate entry points into the APS exist for young people (Chapter 9).

There is evidence that APS agencies are increasingly focussing on the need to meet these challenges both through formal workforce planning, and through the introduction of more informal measures. Nevertheless, there is considerable potential for agencies to improve their efforts in this area, and particularly to follow through the preliminary work that has already begun in the area of workforce planning.

The overall capability of the APS is also affected by its mobility, both between APS agencies and through movements into and out of the APS. Increasing numbers and proportions of employees are being recruited directly into more senior classifications in the APS. Greater mobility has the potential to act as a vehicle for professional development and an opportunity to exchange ideas and better-practice approaches and is central to developing effective whole of government capabilities. The changing demographic profile of the Australian workforce means that increased lateral recruitment is a necessary as well as a positive development. However it does mean that agencies can no longer take it for granted that critical skills and knowledge will be passed on along the way as part of an informal mentoring tradition. Changing recruitment patterns require new and specific capability building strategies, including more systematic and structured learning and development.

The continued trend towards a graduate Service also presents some challenges. Graduate trainees now represent a small proportion of the graduates being recruited across the Service, raising questions about how the Service invests in graduate training and development as well as about its overall recruitment strategies. There is also, however, a danger that potentially able people may be denied opportunities to join and advance in the APS because of limited educational opportunities.

There has been some improvement in the area of performance management, but many APS employees remain unhappy about performance pay. Some of this unhappiness may be unreasonable but some may be reduced by further improvements in agency management arrangements, particularly regarding feedback and more senior oversight to ensure consistency.

Perhaps of even more importance, however, is for agencies to focus on those things that are known to improve motivation and organisational performance, which do not include performance pay per se. This is canvassed in Chapter 9.

Whole of government

Last year’s report identified whole of government issues as an important theme requiring further attention.

Subsequently, the MAC prepared its report Connecting Government: Whole of Government Responses to Australia’s Priority Challenges. That report takes a very pragmatic approach to the issue, with suggestions for appropriate structures and processes and culture and skills, as well as information management, engaging beyond the APS, budget accountability and crisis management.

One aspect followed up in this report concerns the capabilities and skills required for whole of government work, and the efforts of both agencies and the APS Commission to build this capability through workforce planning, performance management systems, learning and development frameworks and leadership development. There is evidence that this issue is receiving increased attention, but these efforts will need to be sustained if the increasing challenge of whole of government work is to be met. Portfolio Secretaries and the SES have key roles in influencing the behaviour and attitudes of APS employees towards collaboration across organisational boundaries.

Diversity

Last year I stressed the importance of diversity to the effectiveness of APS agencies and highlighted my concerns about the risk of further decline in representation of Indigenous Australians and people with a disability.

Unfortunately, the employment of people in these groups continues to be a major concern (Chapter 8). Indigenous Australians were the only EEO group whose representation fell in both absolute and proportional terms in 2003—04, revealing that Indigenous employment has not only stalled but is at serious risk of longer term decline from the high of 2.7% in 1999 (the figure was 2.3% in 2004). The transition from the Aboriginal and Torres Strait Islander Commission (ATSIC) and the Aboriginal and Torres Strait Islander Services (ATSIS) to new arrangements for coordinating Indigenous community services also represent a serious short-term risk that must be carefully managed, notwithstanding the potential improvements in Indigenous services and service effectiveness. All this highlights the importance of the APS Commission’s Indigenous Employment Strategy, and agency efforts to support it.

Embedding the APS Values and the Code of Conduct

The last year has seen positive developments in agencies’ efforts to embed the APS Values and the Code of Conduct into their day-to-day operations (Chapters 6 and 7). Very high (and increased) proportions of APS employees reported being familiar with the Values and Code of Conduct and continued to see the Code as relevant to their daily work.

This finding is particularly pleasing given the importance of a strong grounding in values and ethics in the context of continuing change and the need for a flexible and agile APS. It does however require continued effort, particularly by the leadership of the APS.

The APS Commission evaluation into management of suspected breaches of the Code of Conduct also found that the agencies that participated in the evaluation took misconduct seriously and that generally cases were managed in a manner consistent with the requirements of the PS Act and Regulations. However, there is room for improvement and the Commission intends releasing a detailed good practice guide in 2005 to assist agencies in the refinement of their processes.

Relations with Ministers and their offices

One of the more striking results from the 2003 employee survey was the scale of the interaction between public servants and Ministers and their advisers. Last year, around one quarter of employees reported that they had had contact with Ministers or their advisers in the past two years. That high result was confirmed by this year’s employee survey, which found that 20% of employees had direct contact with Ministers or their advisers in the last year (Chapter 3). This year’s survey also explored the types of contact occurring and found that contact is overwhelmingly in relation to matters of substance (such as the provision of advice and factual information) rather than administrative support.

The proportion of relevant employees having faced a challenge in balancing the APS Values of being apolitical, impartial and professional, responsive to the Government and openly accountable when dealing with Ministers and their offices remained the same as last year (around one-third). As I mentioned last year, I do not find this result surprising given that the political/administrative interface has been the focus of public administration literature for at least the last century. The overall level of confidence of relevant APS employees in balancing the Values remained quite high.

Nonetheless, the number of employees interacting with Ministers and their advisers confirms the importance of training of APS employees to ensure they understand the Values and to help them make judgments about their application when a balance needs to be found between them. The role of the APS leadership, both agency heads and the SES, in openly discussing the judgments they themselves make as well as advising their staff about the judgements staff make, is particularly important. The Commission plans to issue shortly a new good practice guide Supporting Ministers, Upholding the Values. The guide is intended to build on the Commission’s APS Values and Code of Conduct in Practice: A guide to official conduct for APS employees and Agency Heads.

LOOKING FURTHER AHEAD

Chapter 11 identifies the challenges for the APS emerging from the findings in this report. I hope that, as occurred last year, these inform the MAC and influence its work program, as well as provide guidance to all agency heads and other senior managers across the APS.

Two key issues in my view have longer term implications.

Firstly, the drivers of the current focus on whole of government activity can only push further the importance of the APS having the capability to work across boundaries. The key driver, technology, demands both greater depth of expertise, and greater capacity to draw expertise together. The APS will need to increase its technical and professional expertise, including its capacity to draw on expertise from partners, and simultaneously increase those capabilities that help it shape strategies, cultivate productive working relationships, and communicate with influence, by working across boundaries and drawing threads together.

The boundaries that need to be crossed are not just agency boundaries, but also jurisdictional boundaries (both within and beyond Australia) and sectoral boundaries; greater engagement with citizens is also required. The credibility of the APS in managing these relationships depends importantly on the knowledge and experience of our employees, as well as their appreciation of the perspectives and expertise of others. That suggests a Service that is not ‘hollow government’, relying solely on generalists and purchasers, but one that invests heavily in skills and expertise and promotes increased mobility across partners, including those involved directly in the practical business of major service delivery. The new Australia and New Zealand School of Government is an important initiative for building understanding across jurisdictions; over time it may contribute to wider linkages both internationally and with non-public sector partners.

Secondly, and partly related to the first issue, is the importance of greater coherence amongst the many players now on the stage of public administration. The APS is leading the way in values-based management, and as we work to build a practical integrity framework within which we can confidently promote flexibility and agility to respond to different and changing business requirements, we are becoming increasingly aware of the need for coherent frameworks amongst our many partners.

The recent Uhrig Report touches on this issue, suggesting not only some rationalisation of the governance arrangements for statutory authorities and statutory office holders, but also the articulation of values for those agencies which remain outside the scope of the PS Act. I believe there is a good case for a number of those agencies to come within the coverage of the PS Act, but also that statements of values for those remaining outside should be consistent with the APS Values (with variations reflecting their specific statutory responsibilities).

There is similarly a case for ensuring that private and voluntary sector partners involved in public policy and public projects appreciate their public interest obligations, albeit that these will not match exactly the values of the APS. The increasing role of Ministerial advisers suggests they too would benefit from a clearer statement of values: this could further reinforce their professionalism and the strength of their relationship with the APS in serving Ministers and the public interest.

CONCLUSION

While there will always be room for improvement, this report demonstrates that on many fronts the APS is continuing to build on the performance that has attracted its international reputation. The United Nations award for Improvement of the Quality of Public Service Process in the Asia Pacific Region provided in June this year recognised the reforms and achievements of the APS over recent years. This report suggests continued improvements in capability, in serving the public and in understanding the importance of our core values, while also identifying some important weaknesses that need to be addressed. A confident and high performing APS requires capacity and willingness to continually review the evidence about our capability and our adherence to the APS Values and to respond positively to the lessons that emerge. The State of the Service report is now central to this task.

A S Podger
Public Service Commissioner