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Ch 4 Through troubled times

This section of the history traces the evolution of the Act through the period of the Depression and the Second World War, during which the Public Service Board operated under a sole Commissioner. The events of those years were to influence significantly the structure and content of the Public Service Act, contributing materially to its increasing complexity and prompting periodic representations in the post-war years for reform and simplification.

Significant Public Service Act amendments 1931–46

The circumstances of the Depression and the Second World War were to generate relatively few amendments to the fundamental Act provisions relating to the structure and administration of the Service although, as indicated below, other legislation impacted significantly on its operation. Important Public Service Act changes were made, however, in the following areas, culminating in some major changes in 1945.

Recruitment of graduates

The Commonwealth Public Service Act 1933 inserted a new s. 36A to provide for appointment to the Service, as base-grade clerks, of university graduates, provided that such appointments were not to exceed 10 per cent of the base-grade clerk intake in any year – not a limitation which was to generate any real concern in the ensuing 30 years or so. Parliamentary debate on the new provision featured vehement opposition from Labor members, who accused the government of sponsoring an elitist provision for the benefit of their more affluent constituents, who were able to afford university education for their children, while working-class families continued to struggle in the depressed economic conditions–prompting then Attorney-General Latham to label Labor critic JA Beasley in one exchange as ‘a specialist in irrelevant excitement’ (CPD 6 December 1933, p. 5873).

While the numbers involved remained small (43 eligible applicants and 11 appointees in 1934 intake), the selection process was taken very seriously:

The Committees comprised representatives of the local University, a representative of one of the principal Commonwealth departments in the State, and the local Public Service Inspector. In making a final selection, the Board was most materially assisted by discussion of the report of the State Committees with the Vice-Chancellors of three Universities at which the candidates’ applications were exhaustively examined with due regard to educational attainments and personal qualifications (PSB AR 1934, p. 18).

The intensity of this selection process was to be moderated considerably in later years, but it may well have served as a model for selection processes adopted in the 1960s, particularly for the Board’s Administrative Trainee Scheme, when graduate recruitment was accorded high priority.

Returned soldiers recruitment

The Commonwealth Public Service Act 1934 further modified returned soldier recruitment provisions, to allow for appointment to the Service of an applicant, notwithstanding any physical defect likely to prevent continuance of efficient service up to the age of 60 years. Appointment of such applicants had often been refused previously, having regard particularly to the likelihood of premature retirement and consequent drain on the Superannuation Fund. The effect of the amendment was to permit such an appointment to proceed, but to provide that the appointee would not be deemed to be an employee for Superannuation Act purposes. In later years, appointees in similar circumstances (returned soldiers and others) were to be given opportunity to contribute to a separate (non-pension) Provident Fund, established under the Superannuation Act.

Protection of appeal rights during military service

The Commonwealth Public Service Act 1940 made special provision for appeals against promotions to be initiated by the Board on behalf of an officer absent on war service, with the object of ‘ensuring that his claims receive full consideration in relation to the filling of all positions to which he may aspire’ (PSB AR 1940, p. 2). The mechanics of this process are not discussed in the report, but it was stated to have involved a great deal of work and to have resulted in a number of appeals being decided in favour of absent officers.

Subsequently, the Board noted that, of 170 appeals upheld in the year under review, 63 were in favour of officers absent on war service (PSB AR 1943, p. 3). Much later, in 1966, the Board was to put in place similar ‘absentee’ appeal arrangements for officers called up under the National Service Scheme, which required up to two years service and could involve overseas service in Vietnam.

Commonwealth Employment Service

The Commonwealth Public Service Act 1945 provided for the transfer to the Commonwealth Employment Service (CES) of several hundred staff, previously employed in state labour exchange organisations. The CES had been a derivative of the Wartime Man Power Directorate, which dealt with the allocation of available people resources between the Services and civilian occupations, and with the supply of labour to ‘protected’ undertakings. The government subsequently decided that a Commonwealth employment service should be established on a permanent basis, initially with functions in assisting in the re-employment of ex-members of the Armed Forces, and in the reestablishment of civilians who had been engaged on war work, and in providing other employment and advisory services (the subsequent principal CES function).

The promotions and appeals system

The Commonwealth Public Service Act (No. 2) 1945 effected major changes to promotion and promotion appeal provisions, along with other significant amendments to the 1922 Act.

Promotions and appeals

These changes occurred in response to recommendations of the Bailey Committee appointed by the Government, following union representations, to inquire into Act and regulations provisions relating to promotions and appeals and also the regulations relating to ‘temporary transfer’ to vacant positions (in later years, to be described as temporary performance). Composition of the Committee (chaired by Professor KH (later, Sir Kenneth) Bailey, then Professor of Public Law at Melbourne University) was detailed by the Board, along with the Committee’s terms of reference (PSB AR 1945, p. 1–2). The Committee’s recommendations are recorded the following year (PSB AR 1946, p. 2–5).

The detail of the amending Act and regulation, provisions is now largely of academic interest but, fundamentally, involved the establishment of a Promotions Appeal Committee system, independent of any direct Board control. The Board’s power to determine appeals was retained only in relation to appeals by officers in States other than where the vacancies existed, and in relation to appeals in respect of promotions to offices above a prescribed maximum salary level—in effect, the higher-level Third Division and all Second Division offices. Similar regulations were made to govern appeals against temporary transfers.

Joint Council

The same enactment also made provision for establishment of the Joint Council, directed to provide a forum for regular discussion between representatives of management and staff on matters of general Service concern. It was expected to deal with such matters as employment conditions and improvement of procedures and staff welfare, and to address issues of principle rather than individual cases. The Council was constituted under regulation provisions, which detailed its functions, membership and mode of operation. The Council was to continue in operation for the next 50 years, but with generally declining significance through the 1990s. Ultimately, its functions were to be superseded by the development of new consultative arrangements under wider-ranging industrial legislation, as now reflected in the Workplace Relations Act 1996.

Classification Committees

The amending Act further made provision for the setting up of classification committees, to assist the Board in the regular salary reclassification of the Service. Again, the operating framework for these joint management/union Central Classification Committees (so designated) was provided for in the Public Service Regulations, and the Board used the committees extensively in the early years after passage of the legislation.

Their significance declined progressively through the 1950s and, ultimately, their function was superseded by the processes adopted in the 1960s under Board Chairman Wheeler, to bring about radical changes in classification structures and pay fixation in the Service.

Officers contesting elections

The provisions for right of return to the Service of officers who had resigned to contest elections and had failed to be elected (now reflected in s. 32 of the 1999 Public Service Act) had their origin in the 1945 Act amendments, which also included similar provisions in relation to temporary employees.

Commonwealth employment of state taxation staff

The Commonwealth Public Service Act 1946 provided for the permanent takeover, from 1 July 1946, of former state taxation staff (by then numbering some 3700) associated with the collection of income tax. Those staff had been temporarily transferred to the Commonwealth under the Income Tax (War-time Arrangements) Act 1942, to which further reference is made below.

Other significant legislation 1931–46

Operation of the Service was affected significantly by a number of wider-ranging enactments principally, but not solely, deriving from Depression and World War II circumstances. The more important of these changes were:

The Financial Emergency Act 1931

The Financial Emergency Act 1931, reflecting preceding premiers’ conference decisions, was designed to achieve an average reduction of 20 per cent in the quantum of Service salaries and wages which had been payable at 1 July 1930. Implementation of the measure is recorded by the Board (PSB AR 1931, p. 5–7). Pay reductions were to be related to the general fall which had occurred in the cost of living, thereby justifying a lower Service basic wage, and were to be applied on a percentage sliding scale. The report stated that, generally, reductions ranged from 18 per cent on the lowest salaries to 25 per cent on the highest.

The Financial Emergency Act was amended in 1932 to provide that, in addition to the reduction made in 1931, salaries and wages should be reduced further by the amount represented in a further fall in the cost of living in 1931. Relief from the stringencies of the financial emergency legislation was to be provided first by the Financial Relief Act 1933, which provided broadly for some restoration of salaries reduced in 1931 and 1932.

Further restorations occurred in 1934 and 1935, and the situation was to be restored to ‘normal’ (excluding reductions which had occurred separately by downward cost of living adjustments) by the Financial Relief Act (No. 2) 1936.

The Income Tax (War-Time Arrangements) Act 1942

The Income Tax (War-Time Arrangements) Act 1942 provided for the takeover, from 1 September 1942, of some 2800 state income tax employees from the Taxation Branches in NSW, Victoria, Queensland, South Australia and Tasmania, with the Board classifying all the offices involved and allotting staff thereto. The Commonwealth’s income tax collection arrangements had been administered by those states since 30 June 1923 under Commonwealth–state agreements, authorised by the Income Tax Collection Act 1923, with relevant Commonwealth staff having been transferred to the states for these purposes. In Western Australia, however, an arrangement had already been in force since 1921, under which income tax was collected by the Commonwealth on behalf of that state. This arrangement was not affected by the 1923 legislation and continued in place, to then accord ultimately with the regime adopted in 1942. As mentioned previously, the Commonwealth Public Service Act 1946 then provided for the permanent takeover by the Commonwealth of income tax staff.

The Australian Soldiers Repatriation Act 1943

Existing Public Service Act employment preference provisions for World War I returned soldiers were extended to World War II soldiers by s. 44 of the Australian Soldiers Repatriation Act 1943, which amended existing veterans’ legislation of long standing (the Australian Soldiers Repatriation Act 1920–1941).

The Commonwealth Employees Furlough Act 1943

The Commonwealth Employees Furlough Act 1943 extended to temporary employees, from 1 May 1943, long-service leave provisions similar to those for permanent officers.

The Re-establishment and Employment Act 1945

Employment in the Service became subject to the wider-ranging returned soldier preference provisions of the Re-establishment and Employment Act 1945 (‘the R&E Act’). In broad terms, employers generally were required to give preference to returned soldiers in engagement for employment, unless the employer had ‘reasonable and substantial cause for not doing so’ (s. 27(1)). Allied with the ongoing Public Service Act preference provisions, the R&E Act affected significantly, at least in principle and in presentation, Service employment in the early post-war years, with gradually declining significance thereafter. Overall, the combination of these preference provisions probably impacted most significantly (and adversely) on recruitment of school leavers to the Service—an issue to be taken up in the latter part of the 1950s by the Boyer Committee inquiry into public service recruitment.

Other changes and developments 1931–46

Legislative amendment shaped significantly the evolution of the 1922 Act and its growing complexity. It is important, however, to see that evolution against the background of the complex environmental conditions affecting the Service and the community generally over this 15-year period. It is of interest to note also the occurrence of some significant non-legislative changes which were to prove to be of ongoing importance in individual areas of the Service or for the Service at large.

This section of the history notes a range of those developments considered to be of particular interest.

The Depression years

The then Board Chairman Skewes retired in June 1931 and was succeeded by WJ Clemens as sole Commissioner. Clemens’ first report records intensification of earlier occurring difficulties for the Service as a result of the onset of the Depression, with ‘grave problems in the utilisation of permanent staff which had become excess in certain sections of the Service’. Service staff numbers had decreased by 4069 (11 per cent) in the year under review, and expenditure on salaries, wages and allowances had reduced by 9 per cent, with further substantial savings occurring subsequently as a consequence of the financial emergency legislation previously mentioned. In later comment on efficiency and economy in departments, the report noted that the activities of the Postmaster-General’s, Trade and Customs, Defence and Works departments had shown a ‘marked diminution’, but the work of the Pensions and Bankruptcy Branches had ‘heavily increased’. The report noted also the introduction of Commonwealth sales tax, necessitating additional administration and collection staff in the Taxation Branch of Treasury (PSB AR 1931, p. 1, 18, 19).

In the following year, Clemens expressed concern that cessation of youth recruitment during the Depression (the subject of earlier Board concerns in relation to curtailment occasioned by recruitment preference for returned soldiers) could seriously endanger Service efficiency in a comparatively short period—a problem which was to be further compounded in later years by recruitment preference arrangements for returned soldiers following World War II. He reported also that many difficulties remained in dealing with cases of excess officers, and adult officers still having to be employed in junior positions, at junior rates of pay, after reaching 21 years of age (PSB AR 1932, p. 20, 24, 26). Some salary relief was to be provided subsequently by regulation provisions until, in May 1936, the relevant regulations were able to provide that all the officers concerned could be given adult rates of pay.

By the time of his following report, Clemens was able to observe that economic problems had lessened in complexity, with excess staff problems being largely overcome, although there was still little opportunity to return to their former grades officers who had been reduced in classification. Further, adult officers who had entered the Service as juniors were still not able to be absorbed into adult positions, notwithstanding any salary relief which had been afforded to them, with the resultant continuing suspension of junior recruitment (PSB AR 1933,p. 5, 12).

In his final report as sole Commissioner, prior to his retirement in March 1937, Clemens notes that the Service then comprised 10 departments with 28 072 permanent officers, from a Depression low point of 26 977 at 30 June 1934. With the accompanying growth of temporary and exempt employment, total Service staffing, increased from a 1931 low point of 32 312 to 38 503 by 30 June 1936 (PSB AR 1936, p. 26).

Public Service Regulations

Although not mentioned by Clemens in his reports, the Public Service Regulations were remade in January 1935, with a commencement date of 6 March 1935. The overall structure and content of the Regulations appears to have changed little from the original 1923 Regulations, and the remake was presumably in the nature of a consolidation. While the number of Regulations decreased progressively in the post-World War II years, the general structure of the 1935 remake remained in place until superseded by the new Public Service Regulations, made on 3 December 1999 following passage of the 1999 Public Service Act.

Retirement of Clemens

As a consequence of his service as Commissioner (from 1 January 1929) and sole Commissioner (from 11 June 1931), Clemens presided over the Service for almost the complete duration of the Depression. He retired on 26 March 1937, after service dating back to 1889 in the Victorian Postal Department. He was an original member of staff of first Public Service Commissioner McLachlan, and became Secretary and Chief Inspector when the Public Service Board was established.

In his final report, Clemens reflected with pride on the development of the Service over the years of his involvement, and the reputation which he believed that it had developed for ‘loyal and efficient service’ to both government and the general community. In asserting the need for officials to possess courage and consistency in the exercise of administrative and executive functions and to be inventive in tendering advice, Clemens included, with obvious approval, the following quotations from Government Career Service by Professor Leonard D White:

Governments have come to be engaged not merely in preventing wrong things from being done but in bringing it about that right things shall be done. A negative Government only requires courage and consistency in its officials, but a positive Government requires a constant supply of invention and suggestion

and

The day has gone when the public service can be manned by persons who have failed to achieve success in the competitive world and who in middle-age seek refuge in the official world. (PSB AR 1936, p. 26–7)

The sentiments so expressed have not lost their relevance, if not always attracting unreserved acclamation in all quarters.

Clemens was succeeded as sole Commissioner by Mr FG Thorpe, with effect from 27 March 1937. Thorpe continued to serve in that capacity through the World War II period and until a three-member Board was reconstituted, with Thorpe as Chairman, on 1 January 1947.

Conference of Public Service Commissioners

The first conference of Commonwealth and state Public Service Commissioners was held in Canberra in September 1937. The conference agenda appears to have focused essentially on ‘conditions of service’ matters rather than broader policy issues (PSB AR 1937, p. 16).

Training of diplomats

The 1937 report records also that the then Department of External Affairs began to recruit a small number of (above base grade) clerks, with qualifications and knowledge particularly oriented to the department’s international activities. Graduates were sought in arts, law, commerce or economics, who had a good knowledge of French or another approved foreign language. Applicants were also required to possess a knowledge of constitutional and modern history, a broad knowledge of international affairs and, in one case, a sound knowledge of public international law and ‘the principles of consultation and of the diplomatic relations of the British Empire’. Selection committee arrangements were similar to those already in place for s. 36A graduate clerks, as outlined above. Five graduates were ultimately recruited under this scheme, two of whom were appointed under the graduate clerk provision, legislated in 1933 (PSB AR 1937, p.17).

Recruitment of ‘diplomatic trainees’ was to be later expanded, through the introduction in 1943 of a more formal cadetship scheme. Prerequisite qualifications were specified similar to those adopted in 1937, but with provision also for consideration of the claims of members of the military forces, on the basis of the best available information and consideration of the applicant’s written essay. In the event, nine males (all members of the military forces) and three females were selected and sent to the University of Sydney for full-time intensive training and study in selected subjects. Further enhancement of the scheme was forecast for the 1944 intake, with an extended period of university attendance. The cadetship scheme continued through to the 1960s, with increasingly more sophisticated selection processes, and was then effectively replaced by a similarly structured graduate entry scheme.

The Service through World War II

Staffing constraints

In his reports from 1939 to 1945, Thorpe commented principally on the difficulties and challenges confronting the wartime Service. Thus, in 1939, he was already commenting on the heavy strains on staff occasioned by the outbreak of war in September of that year–those strains being accentuated by the cessation of appointment of ‘suitable recruits’ during the Depression years.

New wartime Service agencies, such as the Department of Information and the Prices Fixing Commission, were being staffed on a temporary basis, as were additions to public service staffs of the Departments of Defence and the Department of Supply and Development, as far as practicable.

By 1941, Thorpe was noting intensified staffing problems, with remedial measures including temporary employment of some retired officers and the working of overtime. In an interesting, but temporary, reversal of recruitment practice, almost all appointees to the Service were minors (other than eligible returned soldiers and females). This changed emphasis in the Board’s recruitment policy was implemented, with government concurrence, with the object of protecting the interests of persons who had been precluded by war service from seeking appointment. Appointments to adult male positions (other than returned soldiers) were restricted to positions with special features, necessitating more immediate staffing on a permanent basis. Overall, in the year to 30 June 1941, the number of permanent staff in the Service increased from 34 201 to 36 192, with total Service staff (permanent, temporary and exempt) increasing by some 7000.

New departments and functions

A brief (eight pages only) report in 1940 listed seven new departments created since the outbreak of war, including replacement of the former Defence Department by separate Departments of Defence Coordination, Navy, Army and Air. Wide-ranging staffing changes included the utilisation of staff made available from state instrumentalities. Caiden observes that the increasing wartime centralisation of functions in the Commonwealth, and the establishment or planning of Departments of Munitions, Labour and National Service, Social Services and Post-War Reconstruction marked a perceptible shifting in balance towards predominance of the Commonwealth over the states. In the same context, he notes also action taken to enlist the services of prominent private sector figures, with Essington Lewis, Chief General Manager of BHP, being appointed as Director-General of Munitions and newspaper proprietor, Sir Keith Murdoch, becoming Director-General of Information (Caiden 1965, p. 269–70).

Women’s Employment Board

In 1943, Thorpe comments especially on the marked wartime increase in the employment of women on work usually performed by men, such employment being subject to the approval of the Women’s Employment Board (WEB), which also determined rates of pay to be applied—up to full male rates for permanent clerks, medical officers, and certain postal employees and other categories (PSB AR 1943, p. 1–2).

The origins and nature of the WEB are not discussed in Thorpe’s report but other commentators (Caiden 1965, p. 279–80, 322, 337; Ryan & Conlon 1975, p. 124–5) provide some informative background on its establishment, composition and functions. The latter reference indicates that the WEB was established, in part, as a consequence of union pressure, but also because the Government wished to secure the maximum release of men for war purposes and sought to encourage women to enter the workforce.

Regulations initially establishing the WEB in September 1942 were disallowed in the Senate, on grounds both of the WEB’s composition and its departure from the principle of arbitration. It was re-established by Act of Parliament, but its operation was then subject to a High Court writ by the Victorian Metal Trades Employers' Association and others. It continued in existence, however, until October 1944, when its Chairman, Judge Foster, became an Arbitration Court judge, with the WEB function then being devolved to a designated judge of that court.

The task of the WEB had been to determine remuneration, hours and working conditions for women employed in certain occupations in industry during the wartime emergency.

Its determinations continued to be applied through until 1950, when their application was discontinued by the Public Service Board for new recruits, and continued to apply only to women who had continued to be covered by them up until that time.

As indicated above, the WEB accorded to women full male rates of pay in a limited number of employment categories. Prior to this, suggestions for equal pay had gained little recognition. Significant progress was not achieved in this area until the end of the 1960s as discussed in relation to the nature of the service after World War II, and the changes and developments which occurred during the 1947–87 period.

Planning for the post-war Service

In his last report for the war period, Thorpe noted the major task then confronting the Service in restoring organisations and staffing after wartime disruptions. He took opportunity also to revisit the longstanding Board concern with the practice of setting up Government civilian activities outside of Public Service Act control. However, in the same general context, Thorpe also appeared to depart from earlier Board concerns about independent decisions of the Public Service Arbitrator, asserting that over the years the Board and the Arbitrator had built up standards of remuneration and conditions which would be adversely affected by contrary decisions of independent statutory agencies.

Perhaps returning to the earlier Board position, he then asserted that there should be a common authority determining classification and other matters for all civilian Commonwealth employees (PSB AR 1945:1–3). Presumably, Thorpe would have considered that the Board should fill that role, but this was neither specifically stated nor directly implied.

Restoration of the three-member Board

In December 1946, Thorpe’s final report as sole Commissioner foreshadows the then immediately imminent reappointment of the three-member Board.

Thorpe was appointed to serve as Chairman of the reconstituted Board for the remainder of his existing term of office, expiring on 23 March 1947. The two vacant Commissioner positions were to be filled by Mr JT Pinner, an Assistant Commissioner from the Board’s Office, and Mr AV Langker, General Secretary of the Commonwealth Public Service Clerical Association (an ancestor of the CPSU of today) and Secretary of the then ‘umbrella’ union body for the Service, the High Council of Commonwealth Public Service Organisations.