The economist served Coalition and Labor governments while he was in the bureaucracy but he also took time out to head a cabinet minister's office.

Mr Callaghan, who was chief of staff to Liberal treasurer Peter Costello from 1998 to 2000, and again in 2007, says he was proud to be able to gain the trust of both sides of politics, despite his work with the Coalition.

He was particularly honoured that Prime Minister Julia Gillard and Treasurer Wayne Swan hosted his farewell from the federal public service last year.

''Wayne Swan said his respect for me was one of the few things on which he agreed with Costello,'' Mr Callaghan said.

''That meant an enormous amount to me: to fulfil that role of being the best public servant you can be, serving the government of the day, whichever government that is.''

The 61-year-old will become a member of the Order of Australia for his ''significant service to public administration, particularly in international economic policy development and financial reform''.

He first joined Treasury as a cadet in the 1970s and eventually led that department's tax and international economy divisions.

He also worked with the International Monetary Fund and became a deputy head of the federal Environment Department.

But it was his work with the Group of 20 economies, particularly during the global financial crisis, which led to his latest honour.

In 2008, then prime minister Kevin Rudd named Mr Callaghan as his ''special economic envoy'' and the public servant co-chaired several crucial G20 meetings during the crisis.

The Treasury's work in that period - developing an effective stimulus that staved off a recession - is lauded worldwide.

Yet Australians remain equivocal about the emergency spending, which the opposition attacked as wasteful and unnecessary.

Mr Callaghan said such criticism did not concern him.

''No, if you work in Treasury, you have to have a thick skin. There's always going to be criticism,'' he said.

''Your role is to try to do the right thing. I didn't worry about the political debate, though I did at times worry about my peers [and how they coped] … Our job, in Treasury, is just to give the best advice we can and to be able to explain why we think it's the best advice.''

Although Mr Callaghan has left the bureaucracy, he remains closely involved with Australia's international economic advocacy.

He now heads the Lowy Institute's G20 studies centre and splits his time between his new job in Sydney and his long-time home in Canberra.

Mr Callaghan said he felt ''enormously honoured'' to receive a Public Service Medal four years ago and was ''extremely shocked'' to learn that he would also become a member of the order.

''You join the public service to promote good public policy - we're not in it to make lots of money,'' Mr Callaghan said

''This honour is very, very satisfying: a recognition that you achieved something worthwhile.''