For the most part, the Australian public service has adjusted well to the change of government.

Many observers, including some Labor staffers, suffer from the delusion that because Canberra always returns Labor MPs, public servants are all on Labor’s side. New ministers blessed with senior public servants who are personable and keen to please are particularly prone to this trap. The fact is, in a safe seat with a 55% margin, 45% barrack for the other side. The previous government had no difficulty finding supporters amongst public servants, and made “alignment” one of its main selection criteria for CEOs.

The wonder is that with changes of government, our public service remains so professional. Public servants have myriad chances to undermine the government of the day. In many countries an incoming administration puts its own trusted people in charge to guard against this. That too was Howard’s tactic.

Rudd gambled that the public service would remain professional without having to be intimidated through secretarial sackings. Although this has meant some egregiously political appointees remain in place, the upside is that it represents a vote of confidence in the impartiality of the public service: and so can only reinforce that impartiality in the future.

In a further sign of trust, Labor now asks the public service for policy ideas, independent advice and robust debate. This odd behaviour has left much of the public service in core policy advising departments variously bewitched, bothered or bewildered.

Some have relished the rare and welcome experience of actually being listened to and responded energetically: Treasury is the prime example. Treasury of course was one of the few ministries not completely subjugated under Howard — the former Treasurer retained a degree of independence both for his office and his department. So it started from a better position, and its speedy response to the global financial crisis has further cemented Treasury’s reputation for policy advice of the highest order.

Other departments are bothered, because they want to respond but lack the skills and people. Policy skills that atrophied for a decade are hard to renew. Some departments are floundering, others are working extraordinary hours and overloading the few policy-savvy staff they have. Others look outside — Prime Minister and Cabinet has been on an extensive recruiting drive and new Secretary Terry Moran who drove leading edge policy development in Victoria now seems intent on bringing much of that State’s intellectual base to Canberra.

The pressures of the global financial crisis may tempt government to continue working its public service at a furious pace. This would break the spirit of many public servants. They know the new year promises yet more work — implementing numerous review reports, a difficult budget, and delivering election promises (the easy ones are done, which only highlights the degree of difficulty of promises like broadband connectivity and education reform). Without an end of year holiday the government risks losing some of its key public servants to despair.

Then there are public servants just bewildered, having a hard time keeping up. After having it drummed into them by the previous government that public servants should be neither seen nor heard, they don’t understand how a public servant can make a high profile Press Club speech — and that Ministers think this is fine. After being told that their job is to do whatever Ministers want, they can’t cope with the Ministers’ office asking “what do you think we should do?”

Bewilderment is not a problem at the top. Secretaries are almost all getting on well with Ministers, and responding. This is not surprising. With an occasional exception, people do not get to these positions without being capable, intelligent and adaptable.

The difficulties lie in senior levels below. The main reason is turnover: the APS has experienced a wave of retirements due to aging of the workforce, and a quirk in the Commonwealth Superannuation Scheme, now closed to new members, that often rewards those who retire before age 55. As a result, we have seen rapid promotion into senior executive ranks of people selected against the needs of the previous government, which rarely emphasised policy skills. Many have never before dealt with Labor Ministers and don’t realise how they differ from Coalition Ministers.

There are reports of frustration by senior bureaucrats with process. Centralisation of authority in the Prime Minister’s office is not new — but has meant delays given the volume of business under this government. Given that centralisation has been a trend in all Westminster systems, part of modern government, there is no point trying to reduce it: the trick will be to find ways to manage the processes better.

Public administration today labours under systems and processes that were designed for the 1980s style of government. The last newly elected Labor government, and then public service Minister John Dawkins found in 1983 a cadre of enthusiastic public service reformers in key agencies with a well considered reform agenda. That allowed the Hawke government to produce two white papers in rapid succession: Reforming the Australian Public Service (December 1983) and Budget Reform (1984). These provided the foundation for current public sector management; there were accounting reforms under Howard, but no fundamental changes — although the world was already moving on.

Reform is not easy. It has been a truism for generations that the APS heartily embraces change so long as it means not having to do anything different. Public servants fight back against government changes that threaten their own resources. An example recently has been the overt campaign by small agencies against the last budget’s additional efficiency dividend.

Public servants can scupper government reforms. The previous Finance Minister failed to deliver IT outsourcing reforms for three reasons — the model adopted was barely workable, the Prime Minister offered little support, and agency heads resisted. Tanner does not face the same degree of difficulty in implementing the Gershon report on IT purchasing (the approach looks sounder, and he will have Rudd’s support) but even so there will be resistance to any budget cuts.

Nevertheless, the health of the public service depends at least as much on organisation and management as on its capacity for policy innovation. Most Commonwealth public servants do not work in policy – they administer Centrelink payments, process taxes, manage Defence contracts, provide border control and quarantine, monitor and regulate. Their problems are equally pressing – new workers who longer want a lifelong career but to skip from sector to sector, demands for more online interactivity in real time from government, global competition for skills.

If this new Labor government wants public service reform to address these issues, it will have to invent its own. In the meantime, it finds a public service tired, sometimes frustrated, but paddling hard and managing to stay afloat.

Peter Fray

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Peter Fray
Editor-in-chief of Crikey