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Ch11 A perspective on the 1999 reforms

At the time of completing this history, the reforms effected by the 1999 Act have been in place for just under four years. Attempting any significant evaluation of their success, therefore, would probably have to be viewed as premature at this stage. Nonetheless, sufficient time has elapsed for opinions to be formed, and some preliminary judgements made (however well informed) on their perceived benefits and limitations.

A systematic and comprehensive sampling of those perceptions is beyond the scope of this history. However, based on the views of a small (and quite selective) sample of APS executives, and present and former Commission staff involved with the development and implementation of the reforms and their impact on APS agencies, some provisional observations can be ventured, however tentatively.

Overall perceptions

As will be apparent from the concluding comment in Chapter 10, the writer is disposed to view the 1999 Act, overall, as a successful, major reform of the legislative framework for the APS, and one which has, in large measure, satisfied then Minister Reith’s stated objective of creating ‘a modern act which speaks coherently to the future’ (PD House 26 June 1997, p. 6461). In so doing, the new Act has nonetheless kept in place important, fundamental principles and concepts, which have been seen as vital in maintaining a politically independent, merit-based federal public service from the time of its inception.

Satisfaction with the end product

Wider canvassing of views reflected generally positive opinions in relation to what had been achieved through passage of the Act, and in respect of some of the broader outcomes which had been translated into legislative form. A sampling of opinions:

  • a major improvement on the 1922 Act, with the government’s reform objectives well translated into legislative form
  • a very readable piece of legislation, distinguished by its brevity and clarity, which went as far as it could reasonably go, given political realities, with no major omissions
  • it attempted to address real problems, with significant degree of success, as with reform of the cumbersome officers’ mobility provisions of the 1922 Act
  • it effectively complemented the 1996 Workplace Relations Act and the Government’s agenda for wider workplace relations reforms, demonstrating commitment to reforms in the public sector, consistent with these being pressed on the private sector
  • the devolution of personnel management powers to agency heads, with associated accountability obligations, is fully consistent with the thrust of the financial management reforms effected by the Financial Management and Accountability Act 1997
  • the comprehensive devolution to agency heads of former central personnel authority powers constituted in itself a major advance in APS management practice, capable of realising the objective, stated by Reith, of establishing ‘an interlocking framework of powers and responsibilities, integrated within a genuinely devolved managerial environment’ (PD House 26 June 1997, p. 6463).
  • the Act will work well in the long run, but will take time to ‘settle down’, as the respective roles and responsibilities of the Public Service Commissioner and agency heads become better defined and accepted.

At this global level, significant reservations were expressed in only a few areas:

  • The newly defined categories of APS employment (section 22) had not provided a completely satisfactory replacement for the permanent/temporary employment distinctions in the 1922 Act, with related new regulations remaining complex, and with lack of clarity as to circumstances in which ‘conditions’ (such as probation, citizenship and health clearances) should be appropriately applied to the engagement of an employee.
  • Insufficient attention had been given to achieving creative reform of the previously excessive appeals and review provisions, with the ultimate reinsertion into the 1999 legislation of Merit Protection Commissioner provisions (Part 6), reintroducing complexities, without achieving a fully independent review process.
  • No effective remedy appeared to be available for ensuring agency head compliance with the mandatory requirements of section 15(3) for establishment of procedures for dealing with Code of Conduct breaches.
  • The introduction of whistleblower provisions (section 16) had focused principally on protections for persons making, or investigating, breaches (or alleged breaches) of the Code of Conduct, and had failed to provide an effective mechanism for dealing with proven breaches.
  • Within the broad philosophy and structure of the Act, it was incongruous that no merit provisions were specified for the selection and appointment of agency heads (with acknowledgment, however, that this reflected no real change to the historical situation).
  • More broadly, it appeared that there was inadequate understanding of the range of accountability obligations in Act provisions, with consequent need for the Commission to do more to promote and reinforce those requirements.

Consequences of 1997 and 1999 Bill amendments

The ultimate enactment had to be a product of a range of compromises, brought about by amendments proposed by the JCPA, or negotiated through the Senate.

Without seeking to canvass the merits and consequences of individual amendments, the general tenor of observations tended to be that they resulted in no great enhancements, but nor did they do great damage to the overall thrust of the legislation. Added clarity in some areas was acknowledged, as also the fact that the end product had been made more acceptable and marketable to otherwise potentially hostile interests, capable of jeopardising achievement of significant legislative reform.

Some amendments, however, attracted criticism:

  • As already noted above in relation to wider, general reservations, changes to employee engagement and Merit Protection Commissioner provisions were considered to have added complexity, without commensurate benefit.
  • Additions and amendments to the APS Values (section 10) had made them more complicated, thereby potentially lessening their impact and their observance by management and individuals within agencies.
  • Likewise, amendment of the definition of merit (section 10(2)) had made more complex expression of the principle itself, with likely detriment to its consistent interpretation and application.
  • The insertion of a provision specifying ‘the only grounds for termination of the services of an APS employee’ (section 29(3)) had addressed Opposition concerns about an open-ended provision, but had created artificial restrictions, in relation to ability to deal with any cases arising outside the defined circumstances, notwithstanding provision for prescribing ‘any other ground’ in the regulations.

The Act in operation

How well is the Act seen to be working in Agencies? The short answer is that not enough is known as yet, and it is necessary to treat with caution contemporary observations or criticisms, which may well be found to be of less substance or significance in the light of further experience. Additionally, the merits of the Act cannot be assessed effectively without reference also to the operation of the Regulations and Directions, and the interface with Workplace Relations Act processes.

With that caveat, the following range of views perhaps provides some useful indicators of matters which may warrant consideration when a comprehensive evaluation is undertaken, not only of the Act, but also its subordinate legislation and supporting guidance material.

  • Reservations remain as to how well the new Act and its available flexibilities are understood and utilised. Some agencies are seen to be relishing their new powers and freedoms, while others are believed to remain uncomfortable, and either still tend to seek certainty by way of prescription, or look to means of circumventing the new provisions. Too ready agreement to the latter, in response to management pressures and related legal advisings, would clearly be detrimental to the reforms achieved through a greatly simplified Public Service Act, and potentially frustrate the original policy intentions. From the Commission’s perspective, however, there is limited evidence of the varying agency situations and individual local responses. Requests for additional prescription generally relate to unforeseen loopholes in the legislation and associated guidance material.
  • In a related context, concerns have been expressed that initial, hurried drafting of the Public Service Regulations 1999 had resulted in some problems, which might have been avoided by more measured consideration. New and amending regulations, since drafted, have generated concerns also in some instances by their perceived complexity as, for example, regulations relating to attachment of an employee’s salary to satisfy a debt incurred under a Court judgement.
  • The rationale for separate Public Service Regulations and Public Service Commissioner’s Directions is not well understood, and possibly detrimental to proper understanding and application of the Directions.
  • Better understanding is needed of the interaction of Public Service Act and Workplace Relations Act provisions, and the appropriate use by agency heads of their employer powers under each enactment. There is still a little way to go in the negotiation of workplace agreements which consistently reflect key principles of the Public Service Act.
  • In a directly related context, concerns have been expressed that in negotiating new certified agreements, agencies were not necessarily taking the opportunity to promote value 10(1)(o)—provision of a fair system for review of decisions—making clear that this right could not be displaced by agreement provisions. To this point, no hard body of evidence appears to be available to substantiate these concerns to any significant degree. The present study, however, did not attempt to explore the issue in depth.
  • While the State of the Service Report is valuable in providing a measure of the effectiveness of the reforms and some of the perceived achievements and shortfalls, its benefits are lessened significantly by absence of any robust follow-up mechanisms. Observance of accountability requirements and proper application of APS Values and Code of Conduct provisions cannot be measured adequately by reliance only on responses to Commission surveys, without ‘on the ground’ agency assessment by Commission staff (in a supporting/advisory role rather than as critical audit investigators). It should be noted, however, that the most recent State of the Service reports reflect more rigorous and tightly defined survey activity by the Commission.
  • Aside from perceptions of the Merit Protection Commissioner having unduly limited powers, the regulations framework for the various review processes is seen as inadequate for effective operation.

Need for Act amendments

Consistent with the general view that the 1999 Act is still bedding down, there would appear to be no pressing reasons for its early amendment. Furthermore, to the extent that any amendments were contemplated, they would need to be principles-based, avoiding the level of prescriptive detail in previous public service legislation.

That said, there is need also to avoid stop-gap amendments or a build-up of necessary amendments for want of timely effective action—a counterproductive form of response, seen to have bedevilled the 1922 Act and Regulations, progressively compounding their complexity.

As reflected partly in some of the observations recorded in the preceding paragraphs, suggestions for particular amendments at this stage have been advanced in four areas only:

  • Powers need to be incorporated into section 16 to deal effectively with whistleblower complaints found to be of substance. The most far-reaching proposal in this respect was for establishment of an independent, whistleblowing Ombudsman outside the Act—a suggestion in line with the 1997 JCPA recommendation, reserved by the Howard Government for later consideration.
  • The section 26 provisions for voluntary moves between agencies were viewed by some as less than satisfactory, in not providing a clear option for an APS employee to return to his or her original agency, with questionable ability to deal with the situation by way of regulations. Insufficient casework evidence seems to be available so far to provide persuasive evidence for amending the provisions.
  • Section 29 should be amended to modify the restrictive ‘only grounds for termination’ provision. Inclusion in present section 29 of the specific ground for termination— ‘inability to perform duties because of physical or mental incapacity’—was viewed also as inadequate, for purposes of overcoming longstanding problems of achieving best outcomes in this area, due to absence of any satisfactory interface with the superannuation legislation.
  • Although performance of the functions of the Merit Protection Commissioner occurred within the organisational framework of the APS Commission, the section 51 requirement for the Merit Protection Commissioner’s annual report to be included in the Public Service Commissioner’s annual report was viewed by some as unduly restrictive and, in appearance if not necessarily in reality, potentially prejudicial to the independent powers of the former.

Possible future directions

The preceding observations point to a range of issues which might be expected to receive attention on future, comprehensive evaluation of the 1999 Act, including possible areas of legislative amendment.

The scope for more immediate action by the Commission, however, is not dependent ultimately on future evaluation outcomes.

Education/Communication

Available evidence points to the need for achieving better understanding across agencies, both of the flexibilities now available to APS personnel managers at all levels, as a consequence of devolution, and of the associated accountability requirements.

Extensive information-giving seminars preceded introduction and passage of the 1999 legislation. The subsequent educational program appears to have been more limited, not aided by implementation of the legislation having occurred at the end of 1999, at the beginning of the holiday season, or by the necessary diversion of resources to the production and publishing of extensive guideline material.

It remains important for the Commission and the Employment and Workplace Relations Department (DEWR) to direct resources to educational activities—both by way of seminar programs, and through maximum use of existing APS networks, such as Comnet and the Personnel Operations Program. In so doing, both the APS Commission and DEWR can expect to gain better understandings themselves of the level of understanding and acceptance of the reforms at the workplace operational level, including the extent to which agencies have given attention to internal educational programs, for purposes of gaining maximum benefit from the options and flexibilities available under the new Act.

Evidence derived from the Commission’s sample survey of APS employees in May–June 2003 has now provided a better indication of the likely future need for, and possible extent of, educational programs.

Accountability revisited

As indicated above, underlining of the new accountability obligations must necessarily feature in broad-ranging educational programs.

Responsibility for the conduct of such programs rests, in the first instance, with individual agencies. In 2001, the Commissioner noted that, in the year under review, most agencies had experienced a period of consolidation under the new operational arrangements introduced not only under the 1999 Public Service Act but also as a consequence of new directions in budgeting, financial management and taxation arrangements.

In this new environment, accountability was a ‘core issue’ with agencies needing to ensure that the necessary systems and procedures were established to demonstrate that such an accountability framework was in place. In the particular case of personnel administration:

This applies in employment areas such as selection, probation and the management of misconduct, where legislative prescription has been significantly reduced.

Accountability must go hand in hand with devolved employment powers if the new framework is to achieve its potential (PSCr 2001b, p. 11).

Implementing the APS Values and Code of Conduct

For all of the abovementioned areas, understanding and observance of the APS Values was directly relevant (as also adherence to the concomitant APS Code of Conduct).

The integration of the Values into the way the APS works and its decision-making processes is also an essential factor in achieving high performance. The APS Values provide the real basis and integrating element of the Service, its professionalism, its integrity and its culture of impartial and responsive service to the government of the day (PSMPC 2001, p. 10).

Experience with the application and effectiveness of operation of the Act in the first two years generated some concerns about the actual impact and observance of the Values within agencies, on the part of both managers and APS employees generally.

During 2000–01, agency heads were asked to include some specific questions in their staff surveys to obtain feedback from employees on their understanding of the Values and their perceptions of whether they were upheld in the workplace. A low agency response rate of some 57 percent to the questionnaire, focusing both on the Values and the Code of Conduct, pointed to progress being made, but provided some mixed signals in relation to:

  • employee understanding of the Values and the Code
  • application of the merit principle to agency employment decisions
  • agency valuing of workplace diversity (PSCr 2001, p. 17–20).

While the global results and acknowledged limitations of the particular survey allowed for some modifications of interpretation, further follow-up action by the Commissioner was clearly warranted. Its continuing emphasis on agency head obligation to promote awareness of the Values and the Code of Conduct enabled the Commission to report significant improvement in the ensuing year in nearly all agencies, while acknowledging that more needed to be done to ensure that these elements were accepted as core components of organisational culture ( PSCr 2002, p. 21–3).

The Commission’s annual and State of the Service reports for 2002–03 have pointed to significant upgrading and expansion of its activities to firmly embed the Values framework in the APS and, in doing so, to address some of the concerns expressed at the beginning of this chapter. In particular, the intention has been expressed for 2003–04 of focusing on strengthening the evidence base in the State of the Service Report (PSCr AR 2003, p. 9).

In terms of achievement to date, mention has been made previously in Chapters 7 and 8 of new good practice guides issued in August 2003, emphasising the close linkage between the APS Values and the Code of Conduct.

The grouping of Values now used in Embedding the APS Values was advocated by the Commission in its 2001–02 State of the Service Report. It was directed towards emphasising the role of values-based management in defining key relationships and behaviours that underpin the integrity of the organisation’s decision-making process in the absence of detailed central rules (PSG 2003, p. 25).

Apart from information derived from its annual agency surveys, the Commission has been increasingly proactive in obtaining information from agencies at large and from individual employees, both on strategies adopted for promotion of the Values and Code of Conduct, and employee views on Values and conduct issues.

  • Studies of six agencies in the Commission’s recent Values in Agencies Project identified broad support for the Values on grounds of common sense and common practice, as well as a range of strategies for promoting particular Values and the Code of Conduct, but absence of a strategic or holistic approach in any agency to their promotion as a complete package. The conclusions from the project underlined the crucial need for leadership and continuing guidance for employees in relation to application of the Values and the Code in their everyday duties.
  • On the basis of its first direct survey of the views of a large sample of APS employees, the Commission was able to identify further progress in understanding and application of the Values and Code, but considerable variation in familiarity according to age, lengths of service and classification level. Again the survey results supported the need for strong leadership, with varying challenges according to the respective business responsibilities of individual agencies (PSCr 2003, p. 26–33).

The Commission has committed itself to continuing to address progress made by agencies towards adopting an integrated approach to embedding the Values and Code. (PSCr 2003, p. 36).

Apart from its surveys and its seminar and related activity, the Commission has opportunity to pursue these issues sensitively and seek commitment at higher levels, through meetings of Secretaries and heads of management.

Associated issues

The course of future Commission involvement in the above areas may well be affected by events during 2001–02, which sharpened external focus on standards of behaviour and their observance (or perceived non-observance) by some executives and senior staff of the APS, bearing particularly on their perceived relationship with Ministerial staff and their potential susceptibility to political pressure.

The deliberations and findings of the 2002 Senate Select Committee on a Certain Maritime Incident have drawn further political and public attention to the now statutory expression of Values in the 1999 Act, and the associated obligation of the Commissioner ‘to evaluate the extent to which Agencies incorporate and uphold the APS Values’ (section 41(1)(a)). In its report, the Committee recommended specifically that a code of conduct be developed and implemented for ministerial staff (recommendation 11). Allowing for the uncertainties of the Government’s ultimate reaction to the Committee’s recommendations, and to views conveyed to the Department of the Prime Minister and Cabinet by the Public Service Commissioner on eight of the committee’s recommendations, it is nonetheless reasonable to expect suggestions to arise for the Commissioner to exercise a more prominent and proactive role in monitoring and requiring compliance with the professed standards for behaviour for members of the APS in their relationship with Ministerial staff.

Any persisting view that the APS was not overly concerned by the need for maintenance of high standards could be expected to have damaging consequences, as noted by a former Secretary of the Defence Department:

… it’s important that the public service is able to earn a fundamental level of community respect for what it does. The value of this commodity is most easily appreciated by contemplating the consequences of its absence.

Without respect for their efforts, the morale of public service agencies will fall, it will be more difficult to obtain adequate resources to get the job done, it will be harder to attract good staff and, finally, it will be tougher to do the things necessary to lift performance. That’s a slippery slope indeed! (Hawke 19 June 2002, p. 4).

Secretary appointments

As this outline history has indicated, the processes for selection and appointment of departmental secretaries have undergone a number of significant changes across the time span of the three federal Public Service Acts. On enactment, the 1902 and 1922 Acts reflected the traditional formalities of exercise of Governor-General appointment powers, with varying central personnel authority input to related recommendations from the Government. The situation was to remain largely unchanged until the late 1970s.

Both the Boyer Committee and the Coombs Commission addressed the issue, the latter noting that appointments to the key position of departmental head remain less regulated than do any other positions within the Public Service (Coombs Report 1976, p. 98). While not directly attributed to the Commission’s own recommendation for a wider consultative process, the Fraser government legislated new appointment procedures in the Public Service Amendment (First Division Officers) Act 1976, allowing for submission to the Prime Minister of the names of suitable persons by a committee comprised of the Board Chairman and at least two serving departmental heads. While not obliged to follow the committee’s recommendation, any alternative appointment recommended to the Governor-General was to be for a fixed five-year term, with eligibility for reappointment.

In 1984, the Labor Government’s Public Service Reform Act further modified the procedures, removing the committee process but requiring (rather than simply allowing) a report to the Prime Minister from the Board Chairman before submission of an appointment recommendation to the Governor-General.

Dawkins: The Legislation is similar to that prevailing from 1972 to 1976… An option will also be provided for secretaries to departments to be appointed for fixed periods if that should suit the convenience of an appointee and the Government. (PD House 9 May 1984:2152)

Following abolition of the Board in 1987, the Board Chairman recommendation functions moved to the Secretary of the Department of the Prime Minister and Cabinet, where it continues to reside under the 1999 Public Service Act. If a vacancy in that office is to be filled, the Prime Minister must receive a report about the vacancy from the Public Service Commissioner under section 58(2) of the Act.

In the early years after 1987, it appears that the PM&C Secretary routinely discussed with the Public Service Commissioner the filling of Secretary vacancies, but it is not clear whether this practice has been followed consistently in more recent times.

Since 1987, the fixed-term appointment option has become standard practice. The Prime Minister and Cabinet (Miscellaneous Provisions) Act 1994 provided for Secretaries relinquishing their continuing tenure in the APS in return for a salary loading determined by the Remuneration Tribunal. By 1997, all serving departmental secretaries were being employed on that basis, and no new tenured appointments have been made since that time.

The methods of appointment and tenure of secretaries have been of continuing interest to commentators on the APS, both academic and media. The principal focus has been on transparency of the process, bearing variously on initial appointment, reappointment or its absence, and early termination of appointment.

The extent of interest in these issues is understandable, given the long established and continuing perception that the APS has evolved under circumstances of frequently affirmed Westminster traditions in relation to the need for a public service staffed in accordance with the merit principle and apolitical in its operations, especially at its most senior levels. Within this framework, displacement of a Secretary other than of the individual’s own volition can quickly be seized on as an apparently unjustified removal of a person out of favour with a government or individual Minister. This will inevitably be the case where a number of displacements occur at the one time, as a consequence of major machinery of government changes by any newly elected or incumbent administration. Consequential appointment of individuals more acceptable to the government may then be asserted as actual or potential politicisation of the process.

That said, it is almost inevitably difficult to distinguish between perception and reality. It is also difficult to convincingly gainsay the position put by Prime Minister Fraser in relation to the 1976 legislative changes that, while it was intended to minimise the possibility of appointments (and hence associated displacements) occurring for purely partisan reasons, a succeeding government should not be forced through permanency (of appointment) to retain the services of the appointee (PD House 18 November 1976, p. 2865).

Without addressing directly issues relating to the tenure of secretaries, Prime Minister Howard effectively reaffirmed the Fraser position in the 1997 Garran Oration:

Any Government must and should reserve the right to adapt the administrative structures of the public service to best achieve the policy priorities on which it was elected. So also, any government must and should reserve the right to have in the top leadership positions within the public service people who it believes can best give administrative effect to the policies which it was elected to implement. Governments of both political persuasions have recognised these realities (Howard 1997, p. 8).

Concerns about transparency of process and the need for equitable treatment of affected individuals, however, will not go away. In the view of the writer the interests of government in terms of public perceptions might be well served, therefore, by reverting to a selection and appointment process which incorporates provision of advice on all prospective secretary appointees not only from the Secretary of the Department of the Prime Minister and Cabinet but also from a source independent of the that department.

Under present arrangements, the logical source for such additional advice would seem to be the Public Service Commissioner.

In 1958, in recommending a similar role for the Public Service Board, the Boyer Committee proposed that, if the Board’s recommendation was not adopted, a copy of the recommendation, together with a statement of the reasons for its rejection, should be laid before both Houses of the Parliament (Boyer Report 1958, p. 28). The suggestion was not accepted by the Menzies Government then and, notwithstanding changes towards more open government over the last half century, it is probably unlikely to find favour with governments now.

On the issue of the removal of a Secretary from office, the ground rules for the foreseeable future would seem to have been established by the decisions of the Federal Court in the Paul Barratt case in 1999, following the latter’s removal from the office of Secretary of the Department of Defence, as a result of tensions which had arisen between him and his Minister. The Court found in favour of the entitlement to procedural fairness on termination and the opportunity to respond to a statement of reasons provided in relation to the termination, but no entitlement for continuing tenure:

the Secretary’s expectations of continuing employment were not supported by legal authority to the point of enforcement of substantive rights:

there was no obligation on the part of those recommending termination action (the Prime Minister and the Secretary to his Department) to consider whether the Minister’s reasons for loss of trust and confidence were well founded: and

the secretary of the Prime Minister’s Department was not required to provide ‘further and better particulars of the basis upon which the loss of trust and confidence on the part of the Minister rested’ (Barratt v Howard and others, 2000).

As in relation to proposed selections for Secretary vacancies, there would also seem to be persuasive argument and sound presentational reasons for involving the Public Service Commissioner where termination of appointment is being recommended.

Such involvement of the Commissioner in appointments and terminations would be consistent with the process now in place for assessing the performance of a Secretary, namely Prime Minister decision following reports by the Secretary of the Department of the Prime Minister and Cabinet and the Public Service Commissioner.

Recordkeeping

An issue for the abovementioned Senate Committee, and for other interested parties has been the adequacy of recordkeeping in relation to decisions made and directions given in respect of the particular events under review.

Although not addressed as a specific matter in the APS Values, maintenance of effective records is an accountability issue, comprehended by the affirmation that ‘the APS is openly accountable for its actions, within the framework of Ministerial responsibility to the Government, the Parliament and the Australian public’ (section 10(1)(e) of the Act).

Expressions of concern about perceived inadequacies in recordkeeping by Commonwealth agencies are not new. In 1999, the then Public Service Commissioner noted work which had occurred previously to refine and upgrade agency information systems and concurrent advances in information technology, which had provided a significantly greater capacity to collect, extract and manipulate data. These developments brought with them, however, new responsibilities and accountability obligations:

This enhanced capacity to capture information must be accompanied by revised processes and guidelines for its use, including procedures for storage of information as a proper record and for systems to allow authorised access while preventing misuse. The result of deficiencies in this area could be significant and include, for example, loss of evidence of the Commonwealth’s activities and an inability by agencies to meet their accountability obligations (PSCr 1999, p. 62).

The report noted also some previously expressed concerns of other authorities:

  • In a May 1998 report, the Australian Law Reform Commission’s review of the Archives Act 1983 referred to the ‘parlous state of recordkeeping in many Commonwealth agencies’.
  • In June 1999, an Ombudsman report on administration of the Freedom of Information Act found that there had been a decline in the standard of recordkeeping in agencies. The report noted also that few agencies appeared to have centralised management of either their physical or electronic records, with recordkeeping having become somewhat fragmented in larger agencies to the point where it would be an extremely difficult task to identify all agency records.
  • The National Archives of Australia (NAA) had come to the view that recordkeeping by Commonwealth agencies, especially electronic recordkeeping, was not an area of priority for many senior managers. Its own analysis of Auditor-General reports, from 1992–93 to 1999–2000, found that slightly more than half of those reports had included observations on various deficiencies in recordkeeping (PSCr 1999, p. 62–3).

More recently, the Auditor-General has flagged specifically the importance of recordkeeping, in relation to the ability of government agencies to satisfy their accountability obligations. Those obligations remained, despite major changes in the way information was gathered and communicated, as a consequence of rapid advances in technology. Thus:

As we move towards the era of e-government, ensuring the creation and maintenance of appropriate electronic records will be equally as important as ensuring appropriate security and privacy in electronic transactions between governments, citizens and the business community. This is necessary for the confidence of all stakeholders, and particularly for the Parliament (Barrett 2002, p. 13).

An associated observation that recordkeeping commonly lapsed in a pressured environment had been acknowledged two days earlier at a Children Overboard Affair seminar at the Australian National University. Comments attributed to two former departmental secretaries (Keating and Rosalky) had asserted that ‘notes for file’ of decisions made and actions taken were no longer common practice, that ‘formal advice’ was not well-defined or commonly understood, and that informality had become normal practice.

In earlier times, the Public Service Board included within its ‘efficiency and economy’ activities records management, addressing both the importance for management of the function itself, as well as physical aspects of collection and maintenance of records. That level of central personnel agency involvement is no longer appropriate, given the new functions of the NAA and recordkeeping expertise accessible from the private sector, in relation both to traditional hard-copy documentation and electronic or digitally based information.

That said, the accountability concerns remain as ‘a challenge for the governance framework’ (Barrett 2002, p. 12). Given the above history, there would seem to be scope for future involvement of the Commission in the course of its monitoring compliance with the APS Values—perhaps in association with the Auditor-General’s office and the NAA.

The Commission has recently directed further specific attention to recordkeeping issues in the 2002–03 State of the Service Report, taking into account continuing Auditor-General and Archives attention to the issue, its relevance as an issue germane to the Commission’s own agency and employee surveys and the Values in Agencies Project. On this basis the following conclusions are drawn, pointing to ongoing Commission attention:

In terms of recordkeeping, the high level of review activity and increasing incidence of agency- wide policies for dealing with electronic records suggest a growing awareness among agencies of the need to modernise their recordkeeping systems. However, the evidence also suggests that some agencies still need to take a more strategic approach to records management, particularly in relation to electronic records. Small agencies, in particular, continue to have a lower level of review activity, although they are anticipating a greater level of review activity in the immediate future. Their employees are also less likely to see good recordkeeping as an agency priority or to be satisfied with levels of training and information.

Differences in employee perceptions of the importance of record keeping and the availability of appropriate training and access to information, particularly among higher-level staff, also suggest that, while agencies are moving in the right direction, further work needs to be done to ensure that agency policies are implemented in practice. While the NAA has produced material specifically aimed at the needs of managers, targeted training and information that meet the needs of middle and senior management continue to be a priority area for further development within agencies (PSCr 2003, p. 54).

Ministerial staff

The employment of ministerial staff is subject to the provisions of the Members of Parliament (Staff) Act 1984. As such, the reforms effected by the 1999 Public Service Act have no direct application.

Historically, however, an important relationship has existed between the Service and staff selected for work in ministerial offices, with provision for interchange of staff being accorded legislative recognition in the 1922 Public Service Act by insertion, in 1930, of a specific secondment provision (section 48A) for public servants, which was to remain in place until superseded by the 1984 legislation.

More recently, the continuing importance of such arrangements has been recognised by a Prime Minister’s Direction, under section 21(1) of the 1999 Public Service Act, requiring an agency head to grant leave without pay to an APS employee to undertake employment under the 1984 Act.

It is no secret that tensions have arisen from time to time in the working relationships between ministerial staff and departmental public servants. The matter attracted particular prominence during the Whitlam Government period, but it is one which gets an airing with some regularity, with varying levels of expressed concern.

As indicated in the preceding comment on accountability, the issue has been touched on again in recent Senate Committee proceedings, leading to suggestions (initially outside the Committee) that ministerial staff behaviour should be subject also to publicly stated (legislative or otherwise) standards, comparable to the APS Values, but recognising also the special characteristics of employment in ministerial offices. The 1999 Parliamentary Service Act has so legislated for the special characteristics of employment in the Parliamentary Service. As already noted the Committee has proposed that a code be developed and implemented for Ministerial staff (recommendation 11). Such action has also been recommended more recently in the Senate Finance and Public Administration References Committee report concerning staff employed under the 1984 MOP(S) Act (recommendation 9).

The Public Service Commissioner addressed the issue in a 2002 address on roles and values of the APS as it moves into the 21st century. He then suggested that, in clarifying the proper relationship between the Service and ministerial advisers, a case could be made for articulating a statement of values, along with a Code of Conduct, for Ministerial advisers, similar to APS provisions (Podger 2002: 5). Most recently, his 2002–03 State of the Service Report has revisited the issue:

I have commented elsewhere on the important role ministerial advisers now play in Australia’s system of government, and suggested there would be benefit in more formal articulation of their role through a set of values and a Code of Conduct. There are many ways this could be done, but I believe this would help to enhance the professionalism of the advisers, and would complement recent APS reforms and our current efforts to improve professionalism in the APS. It could also serve to reinforce the relationship of trust that is essential between the APS and Ministers and their advisers. I believe the evidence set out in this report of wide interaction between the APS employees and advisers adds weight to the views I have expressed (PSCr 2003, p. 4).

Regulation of, or provision of guidance to, Ministerial staff, has occurred to varying degrees in the United Kingdom, Canada and the USA. Caution needs to be exercised, however, in seeking to draw parallels with the Australian situation, in the light of differing systems of government and associated conventions and practices. Some useful precedents are nonetheless available.

History shows no greater enthusiasm for significant change with respect to providing guidance to Ministerial staff on the part of either of the major political parties, whether they be in Government or Opposition, despite some of the rhetoric occasionally used when not in office. As noted in a paper issued by the Parliamentary Library, in the particular context of the possibility of ministerial staff being required to appear before parliamentary committees against ministerial objections, but also having application to the question of specifying standards of behaviour:

Until one of the Houses tackles a government over ministerial staff, using the full force of the powers available to it, ministerial staff will remain in the accountability vacuum so condemned by oppositions and beloved of governments (Holland, 2002, p. 27).

Outsourcing and the APS Values

From the time of its election in 1996, the Howard Government has been characterised as being particularly committed to the privatisation or outsourcing of a range of government activities where it believed that such activities would be handled more appropriately and economically by the private sector.

In consequence, all agencies subject to the Financial Management and Accountability Act 1997 are subject to a regime of mandatory market testing of relevant activities and services, with an initial focus on the scope for achieving better delivery of corporate services (such as human resource management, financial services and information technology services) through use of financial management and market-based tools such as competitive tendering and contracting.

Seen in perspective, these developments can be viewed as continuing evolution of changes that have been occurring in the APS with increasing frequency over the last 20 years. These changes have involved outsourcing, privatisation and the transfer of APS activities to other sectors and have previously impacted on the Service over many of its former areas of functional responsibility, such as construction, business and property, and transport and storage:

From the late 1970s ... increasing attention was being paid to ways of enhancing the delivery of government programs. In 1976, the Coombs Royal Commission noted that there should be competition in the provision of services with outside sources (recommendation 22), and the 1983 report of the Review of Commonwealth Administration (chaired by JB Reid) proposed consideration of contracting out to the private sector as a path to management improvement (Reid Report 1983:125). By the 1990s, Labor and Coalition Governments were asking departments to seek greater value for money in the provision of services through user-pays and competitive tendering (PSCr2001, p. 88).

As had been stressed by the Public Service Commissioner in previous annual and State of the Service reports, the outsourcing of functions does not lessen ultimate agency accountability for the delivery of those functions by contractors. In particular, with the 1999 legislating of APS Values, obligation now exists for contract management arrangements to ensure that the Values are upheld in relation to outsourced human resources functions. As noted by the Commissioner:

With an increasing amount of work being outsourced, it is important that all agencies give serious consideration to the mechanisms by which contractors are made aware of, and agree to uphold, the APS Values. The Values are central to the public interest aspects of the work that is done on behalf of APS agencies (PSCr 2001, p. 149).

The manner in which this is being realised adds a further dimension to the Commission’s task in monitoring agency compliance with the Values. The Commission’s own survey evidence has demonstrated general recognition of the obligation, but varying approaches to communicating the expectations to contractors, and to providing for remedial action for non-compliance, where appropriate. Drawing attention simply to the existence of the Values and stating general expectations of contractor compliance represent at least a desirable minimum approach. The minds of contractors will obviously be concentrated rather more if the contract terms articulate the Values specifically, and provide penalties for non-compliance, particularly in circumstances where such non-compliance could be seen to have potentially serious implication for an individual agency and the clients it serves.

The Commission’s agency survey in 2001–02 found that more agencies were requiring contractors to meet standards set out in the Values and Code of Conduct in the preceding year. Twenty per cent of the respondent agencies, however, reported that they did not have any arrangements in place to ensure that contractors understood the extent to which they should observe Values and the Code of Conduct requirements.

The Commission has continued to stress the importance of agencies ensuring that non- public servants are aware of the expected standards of conduct in the APS and, as appropriate, determining whether standards set out in the Values and Code of Conduct should apply in full or in part to the provision of outsourced or consultancy services. Increased attention by agencies to these considerations was noted by the Commission in 2002–03 (PSCr 2003, p. 129 ).

Most recently, the issues involved and accountability expectations of agencies have been set out in the August 2003 Values and Code of Conduct publication. (Guide 2003, p. 51).

Ultimately, achieving a consistently more rigorous approach in this area is likely to be influenced significantly by the extent to which the Commission and agency heads are able to achieve recognition and acceptance of the Values as key elements in the manner in which APS employers undertake all their duties, and are responsive to concerns of agency clients who are the recipients of outsourced services.

Public Service Act coverage

As would be expected from its title, the stated objects of the 1999 Act relate to the management of the APS. While its 1902 and 1922 predecessors likewise focused on regulation of the public service, a ‘chief object’ was inserted into the 1922 Act by the 1984 Public Service Reform Act, expanding the focus to provide for a public service to serve ‘the public administration of the Australian Government’ (section 6).

Intentionally or otherwise, the broader reference carried an overtone of the 1976 Coombs Commission endorsement of the concept of a ‘unified service’ ranging across Australian Government employment. It supported in principle (Coombs Report: 9.4.6) a Public Service Board proposal to this effect, with the following broad characteristics:

  • The Australian government employment area could be regarded as a ‘loose entity’ for employment purposes.
  • All major legislated conditions of employment could be brought together into one Act and apply throughout the administration, unless otherwise prescribed.
  • Legislation (possibly the same Act as above) could specify the broad principles that should apply to staffing of the whole administration (such as open competition, the merit principle, termination only for cause and by due process, and conduct requirements).
  • There could be mobility within the administration between individual employing entities, which remain part of the general entity.
  • Particular institutions could be established by separate Acts, which would invoke the general provisions of the basic administration Act, unless departures from normal principles were deemed appropriate—the relevant enabling legislation making such departures readily apparent to the Parliament.

The Coombs Commission emphasised the need to preserve the existing management and employment flexibilities already available to a number of agencies, but was particularly attracted to prospects for achieving greater, and simplified, mobility arrangements between different government agencies.

Defeat of the Whitlam Government probably lessened prospects for adoption of the ‘unified service’ proposal. In the course of a ministerial statement, Prime Minister Fraser stated that the Board had been asked to continue its detailed examination of the desirability of developing arrangements under which the whole or much of Commonwealth government civilian employment would be treated as one entity for a number of purposes (PD House 9 December 1976, p. 3590). The Prime Minister’s answer to a Question on Notice some 12 months later, relating to Board progress on consideration of Commission recommendations referred to it, made no mention of the ‘unified service’ proposal, and no further reference is made to it in Hansard or in Board annual reports up to the 1983 change of government.

Although the Coombs Commission’s recommendations were accorded recognition in the development of Hawke Government proposals, culminating in the 1984 Reform Act, again no reference was made to the ‘unified service’ issue.

Ten years later, however, the issue was revisited by the McLeod Public Service Act Review Group, whose terms of reference required its considerations to include the coverage of the Public Service Act beyond staff employed directly by departments of state (McLeod Report 1994: Appendix 4).

The Review Group recounted some of the background to changes, over the years, in Public Service Act coverage, and noted that each of the Australian states and territories then had common legislation covering its public sector, but with some provisions applying only to the core public service, and not to the whole public sector (McLeod Report 1994, p. 2.36–2.44).

While not directly recommending broad public sector legislation for the Commonwealth, the Review Group advocated replacement of the 1922 Public Service Act by a new principles-based Act, which might serve as a charter document for some agencies operating outside Public Service Act coverage. The proposed legislation could establish a common set of values, principles, and standards of conduct for all employees on the public payroll, while allowing some agencies to be exempted from certain provisions. It recommended that consideration be given, over time, to extending coverage of the new Public Service Act to other public sector agencies, with provision for exemptions or modifications to provisions which were in conflict with the basic purpose of an individual agency (McLeod Report 1994, p. 2.45–2.47).

An information booklet issued by the Public Service Commission, providing a summary of the Review Group’s recommendations and related government decisions, recorded agreement in principle to the Review Group’s recommendation, but without any automatic return of agencies already operating outside Public Service Act coverage. Beyond this, Ministers could examine, on a case-by-case basis, the advantages of individual agencies coming under coverage of the Act, where such action might be considered beneficial to that agency (PSC 1995).

In the event, the proposal was not taken up in the APS reform processes initiated by the Howard Government in 1996, leading ultimately to passage of the 1999 Public Service Act.

With the new Act in place, and in the absence currently of any compelling arguments for early significant amendment, it would now be opportune to be looking further ahead, and considering the merits of a future move to wider-ranging public sector legislation. The present Act incorporates, with progressive refinements over the years, the key principles-based elements advocated both by Coombs and McLeod. As suggested in the McLeod report, there is a persuasive argument that the Parliament, governments from both sides of politics, and the public at large can reasonably expect that general principles (of the nature of those included in the 1999 Act) should apply to all employees on the public payroll.

In 1990, in the course of preliminary discussions on Public Service Act reform, between Commission representatives and senior officers of a number of major departments, this issue was raised, but not pursued—essentially, as a consequence of doubts expressed then as to whether ‘the time was right’ for such an exercise. That doubt is always likely to exist, along with the need for judgements to be exercised in relation to likely government receptivity to any such proposal at a particular point of time. Given the strength of the drive for reforms in recent years, however, a favourable climate might now be considered to exist to pursue further reform in this area.

Precedent already exists in the financial management area. Public Service Act agency heads are chief executives for the purposes of the Financial Management and Accountability Act 1997 (FMA Act) and, as such, are held accountable for the efficient, effective and ethical use of Commonwealth resources (section 44), complementing their Public Service Act responsibilities (section 57) for managing their respective departments and assisting their Ministers to fulfil their accountability obligations to the Parliament. It would be expected that, in the exercise of their dual people and financial management responsibilities, agency heads would be acting in accordance with the APS Values and Code of Conduct. In like manner, as the McLeod Report suggested, similar expectations are reasonable in relation to non-APS chief executives on the Commonwealth payroll who are subject to the FMA Act, whether or not the Values and Code are articulated specifically for them, in legislation or otherwise.

It would be reasonable to expect also that the traffic in accountability provisions should be two-way. Elaboration of the accountability requirements of the FMA Act, by way of FMA Regulations and Orders, would be likely to have relevance to the application and progressive refinement of Regulations and Directions made under the Public Service Act.

In his Second Reading Speech on the then FMA Bill, Minister Fahey indicated that the legislation was matched to the contemporary public sector environment (PD House 1996, p. 8345). The government took a like view of the new Public Service Act. Having regard to the comparable accountability provisions, and to the varied range of functions performed by APS departments, there are legitimate grounds for considering again the McLeod review’s suggestion for a progressive extension of Public Service Act coverage to some existing agencies not so covered, and to appropriate agencies proposed for establishment in future.

Not uncommonly, arguments for staffing a Commonwealth authority outside the Public Service Act have included reference to the commercially oriented nature of the particular authority’s functions. Where the proportion of such activities is relatively small, however, it should remain an open question as to whether Public Service Act staffing arrangements would constitute a significant impediment.

As has been noted earlier, the matter of inclusion or exclusion from Public Service Act coverage has been a vexed issue over the years. While there is no reason to believe that it has become less so, the thrust of Commonwealth public sector reforms in recent years, along with current pressures for raising standards of corporate governance generally, point to the need for continued, legitimate questioning of arguments advanced in favour of other than Public Service Act staffing arrangements. Minimally, there would now seem to be persuasive reasons for any such arrangements mirroring, in an explicit manner, APS accountability provisions in areas such as the Values and the Code of Conduct.

Role of Public Service Commissioner

Following abolition of the Public Service Board in 1987, the office of Public Service Commissioner was established, with independent statutory responsibilities for policy aspects of APS recruitment, promotion, mobility, discipline and retirement, with ongoing responsibilities for overall management of SES staffing.

Twelve years later, the 1999 Public Service Act gave more precise expression to the role, responsibilities and inquiry powers of the Public Service Commissioner, with significant emphasis on the Commissioner’s accountability obligations in relation to understanding and observance, by APS managers and staff generally, of standards expected to be observed in Commonwealth government administration. At the same time, the Act provided for devolution to agency heads of ‘all the rights, duties and powers of an employer’ for staff under their control (section 20(1)).

From uncertain beginnings, there would seem to be little doubt that the Commissioner’s role has become increasingly significant in the APS management framework, as now underlined by various legislative powers. In the light of the range of issues canvassed in the preceding sections, there is every reason to believe that the Commissioner is likely to be called on to play an even more prominent, independent role in addressing complex issues of individual and corporate behaviour confronting Ministers, agency heads and individual APS staff, in the continually and rapidly changing political, administrative and social environment of the early 21st century.

Developments along these lines can be expected to raise new issues concerning the appropriate role and authority of the Public Service Commissioner, in relation to the powers now conferred on departmental secretaries and other APS agency heads, under a devolved management framework. Even where a Commissioner is pursuing a sensitive or contentious line of inquiry, on Cabinet or ministerial authority, issues concerning the status of the parties involved and perceived management prerogatives are likely to present difficulties for achieving effective outcomes.

In these circumstances, the status of the office of Public Service Commissioner itself almost inevitably becomes an issue. This is not to suggest that the Commissioner should necessarily have, and be acknowledged to have, the Secretary-equivalent status accorded previously to members of the Public Service Board. The range of responsibilities of the Board was exercised within a highly centralised management environment, which no longer exists. Nonetheless, the writer believes that justification can be argued for more explicit acknowledgement that the Commissioner has the same statutorily independent authority and status as other reviewing and investigative authorities, such as the Ombudsman.

Part of the issue concerning potential reservations on enhancing the Commissioner’s authority can perhaps be attributed to the Secretary of the Department of the Prime Minister and Cabinet now being commonly accorded the title of ‘Head of the Public Service’. While this was no doubt appropriate, following the demise of the Public Service Board, it no longer sits comfortably with the legislative framework established by the 1999 Public Service Act, or the primarily policy coordination role of the Department of the Prime Minister and Cabinet (PM&C). The Act itself accords no APS-wide role to the Prime Minister and Cabinet Secretary.

Although the Prime Minister has portfolio responsibility for administration of the Act, the defined legislative role of his departmental Secretary in relation to the ongoing operation of the APS is relatively limited, and could now be seen to derive principally from his or her role as Chairman of the Management Advisory Committee, constituted under section 64 of the Act.

Seeming realities aside, there are problems also of appearances. The Secretary is likely to be seen to be identified closely with achieving the political priorities of an incumbent Prime Minister and government. Governments also now acknowledge that such an objective is likely to influence the choice of the particular office holder. Such a situation could be considered to be at odds with that person being represented as head of the apolitical APS, in accordance with section 10(1)(a) of the legislated APS Values, and otherwise required to evaluate agency compliance with, and upholding of, other APS Values and the Code of Conduct.

In a broader sense, the PM&C Secretary does fulfil the role of being Head of the APS. The Secretary is responsible to the Prime Minister and to Cabinet for harnessing and utilising the capability and resources of the Service to respond to the government’s policy agenda and to manage its programs effectively. The Secretary’s statutory role as Chair of the Management Advisory Committee, responsible for advising the government on matters relating to the management of the APS (section 64 of 1999 Act) is directly relevant in that regard.

The Act, however, provides a different focus of responsibility for leadership of the APS, in the sense of building its people resource capabilities for the future, and in ensuring upholding of the APS Values and compliance with the Code of Conduct. Section 41 of the Act specifically assigns those responsibilities to the Public Service Commissioner, including:

  • monitoring employment polices and practices
  • improving people management and leadership
  • coordinating and supporting APS-wide training and career development
  • providing assistance to agencies on request.

Earlier in this chapter, it has been suggested also that the Commissioner should have a recognised role in relation to appointment and termination of services of departmental Secretaries.

In these circumstances, the writer believes that there are logical grounds for suggesting that the Public Service Commissioner, already holding a statutorily independent position within the Prime Minister’s portfolio, should be recognised also as Head of the APS.

The office of Secretary of PM&C would not be diminished by this change. Its status and central role in government administration has been long established and recognised, independently of any suggestion that it has ever exercised an independent central personnel agency role.

Other possibilities could be explored. If change were to occur, however, the recent history of the APS suggests that the role of Head of the Public Service is not one which sits readily with the designated holder of that function having major, or substantially unrelated, departmental responsibilities outside personnel administration.

Endnote

Like any major institution, the characteristics of the federal Public Service are subject to continuing change and external developments. At any given point of time, the perceived value of these changes will vary significantly amongst those directly affected within the APS, or in the eyes of external interested observers, however well informed.

As this history has illustrated, some perceptions inevitably change with the passage of time, and with the benefit of perfect hindsight. The record also demonstrates, however, that in the 100 years since the first Public Service Act there has been consistent adherence to an underlying objective of establishing, and seeking to maintain, an efficient, accountable, apolitical and responsive public service with high professional and ethical standards, based on recruitment and subsequent progression of staff on the basis of merit.

The manner and effectiveness of achieving the above objective, and the articulation of its component, have varied significantly, and will no doubt continue to do so. This will occur both through express legislative provisions and, perhaps more importantly, through the interpretation and application of those provisions in changing political and social environments.

Federal Public Service Acts have been robust enactments. In purely legislative terms, they are prone to becoming significantly outdated, as they fail to keep pace with external developments, and become clearly demanding of reform.

Although not in themselves unique, processes associated with the development and ultimate passage of the 1999 Act illustrated the achievement of realistically attainable and effective outcomes, as a consequence of wide-ranging consultation, negotiation and compromise. Timely attention to such processes and to any necessary refinements can be expected to be of benefit in addressing future necessary or desirable changes to the fundamental legislative base for the APS.