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May 11, 2016


Secretary of the Department of Immigration Mike Pezzullo gave the latest address to the Institute of Public Administration Australia’s Secretary Series yesterday morning, imploring mandarins to get rid of old rules in order to form better policy and administration. The secretary of the notoriously secretive Immigration Department, which has blasted journos for reporting on asylum seekers kept in detention, had a lot to say about communication:

“We should insist on effective communication. In all of our work we should reject jargon, imprecision, hackneyed phrasing, woolly terms, padding, and unclear thinking and language. All of our work requires clear, crisp, meaningful and expressive communication. Written and oral communication should be clear as to the following: how does what is being proposed flow logically from first principles? What are the relevant facts and relevant evidence? What analysis has been done? Which courses of action have been considered? Which is favoured of those courses and why? Clear language should reveal all of this, and it should be insisted upon.”

We couldn’t help but wonder if the media department in his own agency has heeded this advice. Last week an agreed statement between the department and Save the Children used this many words to say that they had wrongly accused Save the Children staff of encouraging asylum seekers to self-harm:

“The Department indicated through public statements that in making the removal direction, the Department relied on allegations that the staff had orchestrated protest activity, coached and encouraged self-harm of detainees, engaged in a campaign to cast doubt on the legitimacy of the Government’s regional processing arrangements and misused and improperly disclosed sensitive and confidential information. …

“The review encompassed the circumstances in which the direction was given, including the alleged conduct of the SCA employees who were removed.  Consistent with the recommendations made by Mr Moss, the details of the allegations, insofar as they related to employees of SCA at the time, were the subject of another independent review commissioned by the Department in May 2015 (Review of recommendation nine from the Moss Review by Adj. Professor Christopher Doogan).  Professor Doogan concluded that the information available to the Department at the time of the removal direction did not warrant issuing the direction.”

Clear as mud, right? Here’s Pezzullo again:

“Public service writing should be clear and direct, active and accountable. Sentences should be action-orientated, lush with verbs. We should use doing words because we are doers, or we should be. The active voice should be the grammatical standard: ‘I decided’, rather than ‘it was decided’. Insist on your staff writing competently, succinctly and accurately.”

Active and accountable? This from a department that will only ever be quoted as a “spokesperson”, never with a name.


Apr 15, 2016


Liberal member for the South Australian state seat of Bright David Speirs is not super keen on public servants, using a speech in state Parliament on Wednesday to let everyone know what he thought of them — and of political SA news website InDaily.

The rookie MP, who jumped into Parliament from a public service job in the Premier’s Department, was keen to assure anyone listening that he totally supported most of the public service.

“However, I also group a large proportion of the hidden public service workforce (the background bureaucracy) as being an important part of the engine room of our state,” he said.

“Advisers. Latin name: Adviserous Horribilis. Usually underqualified and overly confident, largely aged 25 to 35, characterised by having the log-in details of multiple fake Twitter accounts stored in the notes section of their iPhones. Their habitat is a murky half-world, a purgatory somewhere between public service and political office.

“They read InDaily, drink at small bars, enjoy fatty and sugary foods and have the physical characteristics associated with enjoying fatty and sugary foods. Chameleon-like, they have the unique ability to change their skins, depending on the location of the safe seat they aspire to represent. They often interbreed, leading to a reduced gene pool, and are loved only by their mothers.

“While their day-to-day habitats tend to be open plan offices, enabling them to throw foam footballs to one another, every fortnight or so on Tuesdays, Wednesdays and Thursdays they congregate in the shadowy benches of the Speaker’s gallery to watch their favourite sport: question time.

“They are for sure an interesting pest, an overabundant species, to use the latest vernacular from the environment department, and as observers of the environment department would know, whether it is corellas or fur seals, this government is loathe to deal with overabundant creatures.”

He said the number of political advisers should be slashed, because they added little value with their advice.

“They will make changes for the sake of change, just to justify their existence and remind themselves that despite having dropped out of the arts degree to concentrate on student politics, they are geniuses, masters of political strategy, and so they tell themselves 100 times a day that they are normal, emphasis on that very subjective word ‘normal’, and lucky to have landed jobs serving the good folk of South Australia.”

Speirs made several allegations — without naming anyone — about advisers being appointed to plum public service positions, and the independence of the public service being eroded.

“Public servants take direct instruction from chiefs of staff and political hacks instead of from their line managers, with governance by fear so entrenched that managers who are on contract are left feeling too exposed and vulnerable to push back against inappropriate requests.

“Only last month, a public servant told me that he had arrived at work on a regular Monday morning to discover a new position had been created in his team, one that he did not know about until he arrived. A desk and computer had been set up in his area over the weekend and a new ergonomically assessed chair had been put in place.

“At 9.30am (not an early starter), after coffee with his mates at Blefari’s [a cafe on Victoria Squre] and a few fake Twitter posts later, a former political adviser sauntered into the office. He had been made a director on about $150,000 a year or maybe more — no process, no accountability, no thought that someone else in the public service might like to apply for that job, a job that did not even exist and was not needed on Friday afternoon.

“No, this was a gift from a minister for the loyal service of a particularly unsavoury political geezer.”

Speirs doesn’t only despise political advisers — he’s also not too keen on politicians, despite being one himself.

Last year, he described the state’s politicians as an “irrelevant rabble”.

He said his constituents repeatedly raised with him “the immaturity of the parliament, the lack of bipartisanship and the games and dirty tricks”.

The government wasn’t amused by Speirs’ speech.

“This from one of the Liberals’ so-called rising stars,” a government spokesman said. “If they put as much effort into policy formulation as they do into crafting bitchy little speeches they might have a chance of being a serious political party.”

*This article was originally published at InDaily

Tips and rumours

Dec 7, 2015


Never say public servants can’t achieve new heights in risk aversion. Yesterday the department of Prime Minister and Cabinet released a paper on “public service data management”, meant to “deliver a roadmap to unlock the potential of public sector data to drive innovation, efficiency, productivity and economic growth”.

Sounds great, right? Even though it was commissioned under Tony Abbott, it’s sounds all innovatey and agiley and Turnbullesque. But go to the section on risk management for some prize shinyarsery. Identified as one of the “five key risks to transforming the way the Commonwealth manages public sector data” is

Adverse policy findings
• Risk that information is released which could lead to unfavourable findings about policy effectiveness”

Wait, what? So PM&C think it’s something to be worried about that people might use public data to identify that government policies have failed? And how does it propose to address this horror scenario?

• Enable trusted access to linked data in a secure environment where the use of data can be tracked
• Develop protocol on releasing findings
• Build productive relationships with researchers”

That is – surveil who accesses your data, restrict how it is released, and try to stop researchers from saying bad things about you. Thank goodness the command-and-control mindset hasn’t gone away in the new era of agility.

*Heard anything that might interest Crikey? Send your tips to or use our guaranteed anonymous form


May 1, 2015


An army of anonymous staffers keep our democracy ticking over, working behind the scenes to give our politicians the tools they need to do their jobs. But what exactly do ministerial staff do all day?

Chiefs of staff

The hub of every ministerial office is the chief of staff. They have two main roles — as their title suggests, they run the office and manage the staff (especially the political staff), but in many ways, their most important role is to act as the principal adviser to the minister. They should be the person the minister turns to last when making a big decision, and the person who always has the minister’s interests at heart.

It is often said that chiefs of staff are “gatekeepers” to ministers, but I have to say, that never was really true in my experience, even in the busiest levels of the federal government. Ministers tend to talk to whomever they want to talk to — and chiefs of staff cop the blame when someone is aggrieved that they can’t get into the office and they have to deal with the person on the phone instead.

Ministerial advisers

Underneath the chief of staff are ministerial advisers. In the Australian system, ministerial advisers fall into two types — policy advisers and media advisers.

The role of a ministerial adviser is politicised, but not necessarily explicitly political, and one of the core challenges of the role (as it is for a minister) is to balance policy purity with political reality. They do not enjoy the tenure of the public service and are all made redundant when their minister ends their term, whether in happy times like a retirement or sad like the loss of an election.

Sometimes advisers straddle both categories — speechwriters are typically a bit of both.

Media advisers

To indulge the fantasy of almost every staffer, these people are CJ and Toby on The West Wing. Essentially, their objective is to work with the media to present the government (and their minister) in the best possible light publicly.

It’s rarely a good idea for a ministerial office to respond to an issue with a flat “no comment”, so media advisers will press policy advisers and public servants for a more constructive response.

Media advisers are also the front line of the government’s public accountability. The media adviser’s mobile phone number is basically a ministerial office’s front door for the media.

Policy advisers

The role of policy advisers can vary fairly substantially from role to role, but the basic objective of a policy adviser is to help the minister make good decisions in administering the government. Again, indulging The West Wing fantasy, Josh Lyman is a policy adviser.

In this context, a “good decision” means reviewing the various policy options that have been developed by the public service, considering other alternatives that have been presented by other stakeholders in the policy process (e.g. business, unions, non-government organisations, advocacy groups) and understanding the political context in which the decision is made and how various stakeholders would be affected by that decision.

In addition to this, and perhaps most importantly, the role of a policy adviser is to be an advocate for the ordinary person on the street in the policy process. A good policy adviser should aim to understand how people are affected by a government’s decisions in a personal capacity and seek to make this effect as positive as possible.

Public servants in ministerial offices

In addition to these non-tenured staff, ministerial offices are supported by a wide variety of permanent public servants.

These permanent public servants are typically managed by an office manager, who will be the most senior permanent public servant in the office. The role of the office manager is to manage the public service staff, particularly regarding administrative matters or in matters which might put them into conflict with the political staff (such as issues around political independence, which is guarded fiercely).

Typically, the office manager’s role is diverse  — from ordering stationery to dealing with human resources issues. Office managers sometimes stick around even when governments change.

In my view, the most challenging role in a ministerial office is that of the minister’s personal assistant.

Ministers are extremely busy people, who are typically going out to visit people in the communities where they live, rather than sitting in their office in the city or in Canberra. The minister’s PA is responsible not just for setting up meetings, but for making sure that the minister logistically gets from place to place — which in the federal government, particularly, is a nightmare.

The other role of the minister’s PA is to guard the minister’s time, especially against those stakeholders or advisers who tend towards verbosity (a sin of which I am certainly guilty).

Most ministerial offices will also have staff who are dedicated to cabinet and Parliament. Sometimes these jobs are combined, and in the federal government, these jobs are often done by political staff rather than public service.

Ministerial liaison officers (federally, these staff are called departmental liaison officers) are the gateway between policy advisers and government agencies. Typically, their role is to ensure that decisions made by the minister are effectively implemented by agencies.

There’s also normally a receptionist and a driver (at state level, federally the drivers are centralised through Comcar), whose roles are probably obvious. Larger offices might have a couple of receptionists who double as administrative officers when they have spare time.

I liked every driver that I ever worked with, and so do most ministers — they often spend as much time with their driver as with any of the other staff (or their partners and kids) and they can bring a totally unique opinion that doesn’t come up in other part of the process.

Most staff work incredibly hard, incredibly long hours. As in all professions, most staff are very competent — others, less so. Ministerial staff are fundamentally human, with all of the usual faults, but I have never known a group of people who as a group are more dedicated to making this state and this country a better place.

*This article was originally published at LinkedIn


Oct 16, 2014


Occasionally, a report will encapsulate everything that’s wrong with government. Almost never does that report come from government itself.

Victoria’s Auditor-General John Doyle got slap-happy yesterday. In a tranche of reporting tabled in Parliament, he released papers on heatwave management (“a lack of clear and effective leadership”), emergency response systems (“consistently failing”), IT security (“weak”) and mental health support in the justice system (“neither uniform nor sufficiently co-ordinated”). Doyle, an admirably fearless public servant, even had the gall to attack the Napthine government’s accounting practices over a write-down of 10 state schools — an intervention Spring Street veterans call remarkable.

Some of that — at least the stuff on heatwaves and ambulance response — was covered in the press yesterday and this morning. But you wouldn’t read about the most damning findings. The ones that cut to the bone on government accountability and dysfunction. Much more than any parliamentary “porn ring”.

As Crikey‘s sister title The Mandarin reported yesterday, Doyle’s report into how the bureaucracy manages and measures its performance was particularly scathing. Government is failing, spectacularly, to account for and communicate what it’s up to.

Examining three top departments — Premier and Cabinet, Health, and Transport — Doyle said they are “not effectively applying the performance measurement and reporting system” and are falling “well short of providing the information needed to understand departments’ effectiveness and efficiency in delivering outputs and intended outcomes for the community”.

Since 2011, the Victorian bureaucracy has been required to report not only its output but the impact that has on the community. Three years later, reporting still falls “well short of the government’s minimum requirements” and “the rate of progress does not suggest that agencies are close to addressing this”.

There’s specific evidence of systemic indolence. Another of Doyle’s reports, into technology systems, found security controls are inadequate and disaster recovery planning requires “urgent attention”. Of the previous recommendations grimly warning of security flaws, less than half have been taken up — and only those that were “low-risk” rather than higher risk. That is, picking off the low-hanging fruit and ignoring anything that might have been harder to solve.

In its failure to effectively measure performance, Doyle said the bureaucratic “weaknesses, repeatedly raised over the past 13 years through VAGO [the Victorian Auditor-General’s Office] audits and other reviews, remain unresolved”. Today, in yet another attack, he noted “serious concerns” with the Audit Act and that, four years after an inquiry recommending change, nothing has happened.

The charge is clear: even when it’s specifically instructed to improve systems, the bureaucracy either moves at glacial speed or does nothing at all. In some cases, more than a decade of inaction.

Government can get away with it because nobody is paying attention. You can’t blame anyone for tuning out when the reporting from government is so “impenetrable” (Doyle’s words) and fails to provide “the information needed to understand departments’ effectiveness and efficiency in delivering outputs and intended outcomes for the community”. Journalists can’t hope to get through all the reports anyway …

As Doyle lectured: “Being transparent and accountable are not optional extras under our system of government and are undermined if departments do not accurately and clearly communicate their performance. Parliament and Victorians deserve no less.”

Perhaps. But you’ll be waiting a long time to get it.

*More on the Auditor-General reports — and the best public policy debate — at The Mandarin


May 2, 2014


The Commission of Audit estimates that its recommendations could lead to a loss of 15,000 Australian public service jobs. But that is less frightening for the public service than it appears.

Some are likely to arise from privatisations, which do not necessarily lead to job losses. For example, privatising the Defence Housing Authority would mean a change of ownership, but people will still be needed there to deliver housing to Defence personnel. While privatisation sometimes does lead to staffing reductions, it is not always the case.

Second, the government is not likely to accept all the recommendations. There may well be fewer job cuts than the commission recommends.

But most importantly, at least any cuts that come in the budget would be associated with specific initiatives, so public servants affected will know where they stand. There are good and bad ways to cut. The Commission of Audit sensibly rejects across-the-board efficiency dividends as a “blunt instrument” that has reached its limits.

Nevertheless, there are already public service cuts underway as a result of the past government’s additional efficiency dividends. Any further cuts will come on top of these, which will severely affect some agencies. Because the Commission of Audit is targeting particular types of cuts — for example, to Defence Force headquarters and executive-level staff — the Canberra economy would be hard hit (assuming, that is, the recommendations are agreed by the government and announced in the budget).

Some of the public service recommendations have been well foreshadowed in public comment — for example, cuts to the Defence materiel organisation and to climate change agencies, and mergers of a number of health agencies. Although there are new recommendations for abolishing or merging numerous Commonwealth bodies, many of those slated for abolition are committees or advisory boards where the main effects will be felt not by public servants by a very small number of board members.

Recommendations on e-government and transition to online service delivery could just as easily have been welcomed by the previous government. It is where all services, including public services, are heading. The Commonwealth lags behind states and other countries and has to pick up its game. Better online services can and should be implemented regardless of political preferences.

The report, especially in phase 2, includes numerous recommendations on improving public service performance.

Some of them are well overdue. The commission notes (recommendation 10, phase 2 report) that “there is no systematic evaluation of programmes at the Commonwealth level”. There used to be. All programs had to be evaluated and the evaluation reports published. That requirement was dropped in 1996; ironically, it might have been as a consequence of the Commission of Audit report back then. I have no inside information from that time, but have been told this was done on the logical (if impractical) rationale that every government service could be outsourced and therefore did not need evaluation. That is, the assumption was that contracting out would build in its own evaluation through tender assessment processes.

“Everyone claims to want better performance, but good intentions butter no parsnips.”

Return of evaluation would be a welcome improvement. Oddly though, the audit recommends that the reports be provided to the Department of Finance. Public accountability would be far greater if evaluation reports could be made public, or at the very least, to the Parliament.

This and other recommendations under the heading “public sector accountability and performance” will depend heavily on whether or not the public service itself takes them seriously.

Everyone claims to want better performance, but good intentions butter no parsnips. These chapters could have been written under any government of the last 30 years.

Public service performance only improves if ministers insist on it, are prepared to be held account for it in Parliament, and are supported in this by the senior leaders of the public service.

If the audit phase 2 report leads to strong resolution on the part of ministers to press for better performance, it will have done the country a service. An important question, though, is whether we will ever know. Alongside better performance information has to be transparency. The report suggests greater auditing by the Australian National Audit office of agency performance information, which will help, but lacks other specific recommendations on how to improve transparency.

There needs to be online publication of meaningful and digestible performance information, and willingness on the part of ministers and parliamentarians to interrogate public servants and pull them into line when performance is lacking. The Commission of Audit fails to address the incentives in our political system for both ministers and public servants to hide information on performance so as to avoid “gotcha” moments and negative headlines.

The phase 2 report also draws attention to the problem of “spans of control” (a bit of wonky HR jargon) that have led to public service departments becoming top-heavy with executives.  As with performance reporting, it is worth identifying the problem, but the only way to fix it will be through better leadership by the public service itself.   The suggested action (including “all portfolio secretaries and agency heads to prepare plans to improve management structures and spans of control for ministers within 12 months”) leaves implementation to internal processes within government. It seems that the commissioners exhausted their stock of tough and specific recommendations in phase 1 and left public servants to write most of phase 2.

The problem is that under current incentive structures the public service won’t make these changes of its own accord. The themes of better accountability, better performance, reduction of layers of management, better use of IT and better corporate services have all been around for years. If the public service had wanted to implement these for itself it could already have done so.

Ministers themselves will need to take action. They don’t have the capacity to manage departments. But they can insist on better performance reporting, enlist the public in the task by making that reporting more open, be prepared to accept the risks that come with change, and ask public service leaders who are resisting change to move on.

Most importantly, they need courage to stare down the negative headlines that will come. Change is never risk free. The major barrier to better public service performance in recent years has been ministers’ insistence that public servants make no mistakes. There is no way any manager, whether in the public or private sector, can guarantee they will make zero mistakes during a change to bring about better performance. A solution to the problem of ministerial timidity is beyond a commission of audit — it has to be up to the government of the day.


Apr 15, 2014


Nearly two weeks on from serious allegations being made by former Australian Securities and Investments Commission employee James Wheeldon about the corporate regulator’s response to demands from the retail superannuation sector for relief from financial advice requirements, we are yet to have a detailed response.

The issues raised by Wheeldon in his evidence to the Senate Economics Committee, which is investigating the Australian Securities and Investments Commission’s performance, are complex but go to the heart of the argument that ASIC is captured by industry and in some ways merely a cipher for the influential companies it purports to regulate. We’re going to deal with just two specific issues he has raised, and do it over two articles in order to explain how extraordinary ASIC’s behaviour was.

Wheeldon joined ASIC in 2004. Despite being dismissed as a “junior lawyer” by ASIC last week, he was no fresh-faced graduate: he has degrees from Sydney University, the University of Chicago and Harvard Law School and spent several years on Wall Street before returning to Australia. He left nine months later, disgusted at the process by which ASIC had given the financial planning industry relief from the requirements of the Corporations Act in relation to financial calculators — online tools that large wealth management firms offer to enable potential customers to estimate their returns from different scenarios.

The ostensible regulatory issue about calculators was whether they amounted to personal financial advice under the Corporations Act — in which case, they would be subject to requirements under the act, and in particular, s.945A, a section since removed in the Future of Financial Advice reforms, which required a reasonable basis for advice and that advice be appropriate.

The Investment & Financial Services Association — these days the Financial Services Council — was and is the lobby group for the retail super sector, controlled by the big banks and AMP. Ahead of the Howard government’s 2005 reforms establishing greater choice on superannuation funds — a triumph for the retail super sector — IFSA was becoming agitated about the calculator issue, because while some retail funds were open about the impact of fees on financial outcomes in their calculators, others preferred to keep their fees hidden. And a calculator that failed to identify fees, or failed to make clear to people using it that it did not include the substantial impact of fees, would be misleading and potentially in breach of the act.

In May 2004, ASIC issued a “guidance” to the industry saying, in effect, calculators weren’t personal advice if they met certain broad conditions. But that wasn’t enough for IFSA, and it continued to lobby ASIC for relief from the requirements of the act. When Wheeldon arrived, he was assigned to work on the issue. In May 2005, ASIC issued a “relief’ for the whole industry with a slightly longer but still broad set of conditions. It’s what happened between those points that raises serious questions about ASIC.

According to Wheeldon, Mark Adams, the head of the area within ASIC in which he worked — regulatory policy branch — was keen to proactively meet IFSA’s concerns about the calculator. IFSA wanted the issue settled quickly before the choice reforms commenced in 2005. Some senior officials expressed concern about the political sensitivity of the issue if IFSA decided to raise the matter at a political level.

Now, for context, it is entirely normal within the public service for industry bodies to meet with officials to discuss regulatory issues. It is also normal for industry bodies, if they find public servants insufficiently helpful, to go the minister concerned to overrule them. Ministers can indeed do that, or they can follow the advice of their department. What was unusual about ASIC’s behaviour around the calculators was its apparent deep concern that IFSA might raise the issue at a political level, as if that was an eventuality that had to be forestalled, and that ASIC itself had the power to mitigate the impacts of the law via relief orders, something most departments, and many regulators, don’t have.

“ASIC internally was aware of problems with calculators and fees, but preferred to lower the standards to which the industry would be held rather than enforce them.”

ASIC also had several options to resolve the issue. It could have rejected IFSA’s request. ASIC has its own, very good, calculator, which addresses the impact of fees, that it could have encouraged consumers to use; it could have encouraged IFSA to ensure its members were providing calculators fully complied with the law and addressed fees — like AMP’s did. Moreover, ASIC knew there was a concern about fees and calculators. Crikey understands that another section of the regulator, during internal consultations on the issue, identified a number of industry calculators that did not include the impact of fees and in some cases simply did not mention fees at all, giving users a highly misleading result.

But when ASIC granted relief in 2005, it did not mention the role of fees at all. The closest it came was to a nebulous mention of costs. In its guidance relating to the order, it only suggested “costs match respected industry-wide sources” — not those charged by the provider itself.

Reappearing last week before the Economics Committee, ASIC “responded” to Wheeldon’s evidence, but failed to rebut any of Wheeldon’s factual assertions. It flagged a more detailed response to come, although at the time of writing that hadn’t appeared. Chairman Greg Medcraft told the committee:

“… there was no special treatment for any parties involved in this matter. I can’t emphasise strongly enough that every single super fund, irrespective of which industry association they belong to, irrespective of whether they are big or small, can use this legal relief to provide these calculators to members. Furthermore, the conditions we attached to this relief apply to all funds in exactly the same way. These conditions are designed to ensure online calculators are of benefit to consumers. They include a requirement that the assumptions underpinning the calculators are reasonable and that the limitations of the calculators are spelt out … ASIC made a relief decision that was completely proper, in response to unintended consequences arising from changes to the law.”

One problem with this is that the issue of unintended consequences doesn’t appear to have been raised internally within ASIC while relief was being discussed — it appears to have been a retrospective justification for the relief, given to Parliament. But the broader point is that ASIC has erected a straw man: the problem isn’t “special treatment”, it’s ASIC’s complicity in lowering the standards applicable to a consumer tool in order to assist some companies to hide the impact of fees, in an industry that relied — and still relies — on hiding the colossal scale of its fees, which are among the highest in the world, from consumers.

All this was a decade ago; what is its contemporary significance? ASIC insists that it has long been concerned about the financial planning industry; as we saw last week, given repeated evidence from 2007 to 2010 that some planners at Commonwealth Financial Planning were engaged in “inappropriate” conduct, ASIC steadfastly did nothing. This is a similar example: ASIC internally was aware of problems with calculators and fees, but preferred to lower the standards to which the industry would be held rather than enforce them.

There is no evidence that ASIC has changed its reluctance to upset the top end of town since then. One of the genuinely funny parts in its statement to the committee last week is Medcraft’s claim that ASIC is wrongly criticised because “it only takes on the big end of town”. Medcraft must move in peculiar circles if he thinks people seriously believe ASIC has a disproportionate focus on big firms. If it does, its focus in on bending the rules to look after them, not enforce the law.

*Tomorrow: from industry representative to regulator — the conflict of interest in ASIC’s response


Nov 11, 2013



With its Commission of Audit, the Abbott government has made the efficiency of the public service a priority. But nowhere in the terms of reference is any attempt to establish how efficient government activities currently are.

There is a very large difference between seeking to reform a highly inefficient government, where fundamental changes may be required, and reforming a very efficient government and refining existing activities.

Although it is difficult to precisely measure the efficiency of the activities of government, it’s clear Australia’s public sector is among the most efficient in the world. This might seem like a bold claim, but data from respected international organisations make a clear case that Australia performs very well compared to similar nations.

And this should not be a surprise given the kinds of expectations Australians have of their government. We tend to compare ourselves to the high-taxing nations of northern Europe when considering the performance of our public sector in areas such as health and education. And yet our taxation levels are far closer to low-taxing nations such as the United States and Korea. Australians expect northern European services on a US budget, and largely this is what they receive.

While there are some complexities in comparing the amount of revenue different countries gain from taxation, it is possible to get a clear picture of Australia’s relative level of taxation. Contrary to some common perceptions, Australia is a low-tax country. In 2010 we were the fifth lowest-taxing nation out of 34 in the Organisation for Economic Co-operation and Development.

The achievements of the different governments are harder to quantify, as international organisations have created different measures of various aspects of government performance. The World Bank has aggregated several of these measures to create an indicator for “government effectiveness“. It also has indicators of “regulatory quality”, “rule of law” and “control of corruption”; Australia ranks highly in all of these, and all could potentially be regarded as part of the outcomes of government.

Comparing Australia with the same set of OECD countries in the same year as the tax revenue comparison places us as the ninth most effective government in 2010.

Combining these two data sets we find that, among OECD nations, we are the only one to be in the top 10 most effective governments, but the bottom five lowest-taxing governments. This is strong evidence that we have a far more efficient government than most of our peer nations.

The follow scatter diagram illustrates this by plotting rank in effectiveness against reverse rank in taxation. The nations plotted closest to the top right hand corner are the most efficient …

OECD nations ranked by lowest taxing and highest effectiveness (2010)

Source: OECD revenue statistics 1965-2010: 2011 edition, 2011; and World Bank, Worldwide Governance Indicators, 2013

The precise position of different nations on the graph could be debated. The particular methodologies of the measures making up the government effectiveness indicator could be argued over, as could the methodology of the World Bank’s aggregation. Also, superannuation payments are not counted as a tax because they provide personal benefits to the contributor, and it could be argued that this boosts Australia’s apparent efficiency in one area of public services. This means the above graph is indicative, rather than precise.

However, the clear indication it gives is that Australia does well in technical efficiency terms, delivering high outcomes for low inputs.

*This is an edited extract of Bang For Our Bucks, part of the Centre for Policy Development’s False Economies series of reports


Nov 1, 2013


Deploring spin doctors. Once upon a time, many, many years ago, MPs used to stand up and ask a question about something that interested or concerned them. Sometimes ministers did not even know what was coming, even if the questioner was from their own political side. Alas, that kind of real interrogation has vanished from Canberra life. These days government backbenchers are told what to ask so a minister can carefully give the prepared answer. On the other side of the house a few frontbenchers monopolise the questioning aiming to get a short grab of their words on television rather than provoking a meaningful response.

This silly game of charades has developed further to the point where the party apparatchiks send out each morning’s catch phrases to be emailed, tweeted and uttered by all and sundry. Members of Parliament are now little more than robot drones to be manipulated by their spinners.

It is the need to be seen playing the game in order to get political promotion that prompts these otherwise intelligent and sensible people to be so supine. Only the retired, or nearly so, occasionally break ranks, like the former Liberal Democrat leader Lord Steel did in the UK this week when he launched a despairing attack on the prevalence of spin doctors in politics, noting that he is given “daily outpourings of tweets to circulate” and bombarded by email with “lines to take” on current issues.

“‘The increasing role of spin doctors is to be deplored,’ he said.

“‘They hand out questions for MPs to ask, and they daily bombard party activists by email with ‘lines to take’. Even I as a humble member of the upper house receive daily doses of laundry lists of the alleged achievements of the Lib Dems in the coalition government, and a selection of press coverage — all favourable of course — nothing critical such as the universally hostile editorial coverage of the last peerage list.”

Back towards centralised power. The credo of “let the managers manage” that has prevailed in the public service for the last couple of decades has taken a big step backwards with the new restrictions on recruitment imposed yesterday by the federal government. The Public Service Commission returns to being the central body deciding if and when outsiders can be brought in. It is making me quite nostalgic.

Wise words of warning. Prime Minister Tony Abbott should frame today’s Courier-Mail front page and keep it on his desk as a permanent reminder of the difficult times ahead. Australian politics has not seen the likes of Clive Palmer in a position of power before.

A little glimmer of optimism. A report from the Netherlands Environmental Assessment Agency out this week (Trends in global CO2 emissions) shows that while actual global emissions of carbon dioxide (CO2) reached a new record of 34.5 billion tonnes in 2012, the increase in global CO2 emissions in that year slowed down to 1.1%. This, said the agency, was less than half the average annual increase of 2.9% over the last decade.

“This is remarkable, as the global economy grew by 3.5%. This development signals a shift towards less fossil-fuel-intensive activities, more use of renewable energy and increased energy saving. Increases in fossil-fuel consumption in 2012 were 2.2% for natural gas, 0.9% for oil products, and 0.6% for coal.

“The share of the ‘new’ renewable energy sources solar, wind and biofuel increased at an accelerating speed: from 1992 it took 15 years for the share to double from 0.5% to 1.1%, but only 6 more years to do so again, to 2.4% by 2012.”

The report raised the possibility of a more permanent slowdown in emissions:

“The small increase in emissions of 1.1% in 2012 (including a downward correction of 0.3% for it being a leap year) may be the first sign of a more permanent slowdown in the increase in global CO2 emissions, and ultimately of declining global emissions, if (a) China achieves its own target for a maximum level of energy consumption by 2015 and its shift to gas with a natural gas share of 10% by 2020; (b) the United States continues a shift in its energy mix towards more gas and renewable energy; and (c) in the European Union, Member States agree on restoring the effectiveness of the EU Emissions Trading System to further reduce actual emissions.”

Australia’s place in the global scheme of things was shown in this graphic from the report:

News and views noted along the way.


Jul 30, 2013



With the passage of the Commonwealth’s Public Interest Disclosure Act you would think the golden age of whistleblowing has arrived. The Public Sector Union went so far as encouraging its members: “Anyone working in government who is witness to, or has information about corruption or maladministration can now make a disclosure without fear of reprisals. These new laws will protect them from payback.”

That’s not true. The new law is better than what we had, which was nothing. But it still has serious loopholes. It’s reckless to encourage whistleblowers without warning them of the dangers.

The biggest failing of the new laws is that agencies will still investigate their own complaints. No minister wants to front a press conference on corruption in their department. An internal complaint unit can make the whole thing go away by tipping off the perpetrator and terrorising the whistleblower. The government can sit on a complaint indefinitely during which time the whistleblower is vulnerable to retribution and cannot talk to the media.

The new laws will be overseen by the Commonwealth Ombudsman. Although the Ombudsman’s office presents itself as a powerful oversight agency, whistleblowers find it a craven organisation reluctant to use the powers it already has. Janice Weightman, who blew the whistle on forged Defence security clearances, told The Courier-Mail:

“Five of us went to the Ombudsman but didn’t get anywhere. They put it in the too-hard basket. We were given the impression that no one wins against Defence; they are too big and too powerful.”

The Ombudsman will make any excuse not to get involved. If those excuses are put under the spotlight and found wanting, they respond along the lines of: “As a matter of courtesy, I need to advise you that any further correspondence about the issues already investigated will be read and filed but not responded to.”

Although the new laws give the Ombudsman increased powers, it remains an organisation reluctant to challenge fellow public servants. On the other hand there are no negative consequences for fobbing off a whistleblower. The organisation has been known to promise whistleblower protection then abandon them. Any whistleblower who trusts the Ombudsman with their welfare is at serious risk.

“The safest course of action for a whistleblower remains not make the complaint in the first place.”

Under the new laws, reprisals against whistleblowers are punishable by up to two years imprisonment, but as the CSIRO did when it sacked three whistleblowers, employers can claim the sackings are coincidental. Further, this would be enforced by the AFP who have been shown to be reluctant to uphold existing laws against crime within the public service. The AFP can sit on crime reports for years and if pressed, refuse to act. As one whistleblower told The Age:

“It was always ‘Yeah, we’re working on something else’ or ‘I’m overseas, we’ll get back to you’. And it sort of petered out after four or five months to no contact at all.”

The laws allow a whistleblower to go to the media if an investigation is “inadequate”, but this is vaguely defined. If the courts later disagree, the whistleblower could find themselves imprisoned or with a criminal record like fellow whistleblower Allan Kessing.

The new laws allow whistleblowers who suffer harm to sue for damages. When they do they will discover government lawyers make money not by quietly settling cases, but by escalating them. The Model Litigant Policy should stop this. It requires government lawyers to offer alternative dispute resolution and keep costs to a minimum. But government lawyers have been breaking this law for years. The government has the power to stop them, but doesn’t.

You may have heard of million-dollar “punitive damages” that courts occasionally award to punish an egregious offender and discourage repeat behaviour. Not so the new whistleblower laws which exclude punitive and exemplary damages. Instead, the whistleblower is only entitled to damages “to put them back in the position they would have been in”, and they still risk being held liable for costs. The safest course of action for a whistleblower remains not make the complaint in the first place. The new laws won’t protect whistleblowers reporting corruption by politicians.

Whistleblowers need to understand what they’re getting into. Their complaint will not be quietly resolved in a few weeks. It will drag on for years. It will cost them their job, their life savings and often their family. Their colleagues will turn on them. They will find it difficult to get another job; no one wants to work alongside a whistleblower. Some commit suicide. Civil rights lawyers and investigative journalists will not support them. Most lawyers will refuse to represent them. The opposition won’t help; it dislikes whistleblowers for the same reasons as the government. The public will not thank them. The public won’t even know their name.

The only thing worse than a corrupt society is one that harms the only people brave enough to report it.

*Brendan Jones is a military software engineer and Defence whistleblower

UPDATE. Attorney-General Mark Dreyfus issued the following statement to Crikey in relation to this story.

In relation to  ‘You better be careful blowing the whistle – new laws have holes’, it is unquestionable that Commonwealth public-sector whistleblowers will have greater protection under the Government’s Public Interest Disclosure Act 2013 than prior to the commencement of the Act.    The Public Interest Disclosure Act provides a clear set of rules for agencies to respond to allegations of wrongdoing made by current and former public officials, and strengthens protections against victimisation and discrimination for those speaking out, including what Professor A.J. Brown, a leading expert on whistleblower laws, has called ‘international best practice’ in giving whistleblowers recourse through the Fair Work Act to seek remedies against their employer.

The Act strikes the right balance to achieve a comprehensive and effective framework to ensure that disclosures of wrongdoing are properly investigated and dealt with, and to ensure protection for public officials who make public interest disclosures. It will encourage a pro-disclosure culture, by facilitating disclosure and investigation of wrongdoing and maladministration in the Commonwealth public sector.   The passage of this legislation means that the Commonwealth will join the other Australian jurisdictions with dedicated legislation to facilitate the making of public interest disclosures and to protect those who make them.

To clarify some inaccuracies and omissions from Mr Jones’ article.

  • Mr Jones accepts that under the Act reprisals against whistleblowers are an offence punishable by up to two years imprisonment.   But offences also apply to protect the identify of whistleblowers and, in addition to the criminal sanctions which may be imposed for ‘terrorising’ a whistleblower, he or she can apply under the Act to the Federal Court or Federal Circuit Court for a civil remedy, or alternatively seek recourse under the Fair Work Act.
  • A whistleblower who seeks redress through the courts will not be liable for the costs of the agency or department unless the proceedings are vexatious, without reasonable cause or unreasonably cause the other party to incur costs. However, a court can still order that the agency or department pay the costs of the whistleblower, if it is unsuccessful in defending its claim.
  • The government cannot  ‘sit’ on a disclosure indefinitely. There are time limits under the Act for steps to be taken to handle a disclosure, and this includes when an investigation into a disclosure must be completed. One of the criteria for external disclosure, including to the media, is if the investigation has not taken place within the statutory time limit.
  • One of the grounds that allows an external disclosure is for a whistleblower to believe on reasonable grounds that an investigation was inadequate.
  • The Ombudsman has significant oversight powers under the public interest disclosure scheme and is required to report annually on disclosures received during the year and any complaints made about the handling of those disclosures.