One of Australia’s great strengths is that because of the reforms of the 1980s and '90s we have all the benefits that come from an economy that has to be globally competitive.
At the present time, this strength is forcing extraordinary structural change upon Australian industry because Australia’s place in the world has changed. This change is beneficial to our national wealth in aggregate, but significant sections of the community are being forced to deal with inevitable and rapid adjustment.
Much of this has already happened but there is more to come.
The structure of the economy is changing and this has implications for the future skill and education needs of the workforce.
However it is a two-way relationship. An expanding supply of skills, research and intellectual property will encourage knowledge-intensive businesses to thrive, further strengthening the economy.
Unlike the reforms of the '80s and '90s, which were all about making the Australian economy internationally competitive, the task for Canberra is in many ways more challenging now because it will require the Commonwealth to be particularly adept in how it manages universities, skills development and research, how it is funded and how all of that translates into the development of new businesses and the strengthening of existing ones.
At the same time, we have to deal with an imbalance in what the federal government spends and what it receives by way of taxation.
The fiscal imbalance has to be addressed but solving that problem will not help deal with the education, skills and research challenges we face.
We have to be able deal with all of the challenges.
What is needed is sophisticated and well-considered decision-making.
It is fair to say Australia has developed a political culture where it has become commonplace for decisions to be taken in minister’s offices with little or no departmental input or awareness. Departments end up with an implementing role.
Such a dishevelled approach makes governments look untidy and confused. But, more important, it stops governments achieving the outcomes they want; they make decisions without all the information and without fully understanding the consequences.
It would be unfortunate if governments, as a matter of course, developed the habit of sacking secretaries on coming to office.
Much responsibility for this unfortunate situation lies with departmental secretaries.
Ministers and prime ministers should have the wisdom to appreciate that nobody builds a respected legacy on the back of a confused collection of reactive press releases and disjointed policy announcements.
Politics is a relative profession – you only have to be better than your opponent – but a legacy is absolute. All political careers end badly and to answer the question what did it all mean you have to have done things that left the nation a better place.
Secretaries have more authority than they think. They can build imaginative institutions that ministers want to consult and they themselves can be effective advocates encouraging their ministers to do sensible things that are good for the minister and good for the nation.
At the risk of feeding the cult of the secretary, I can say that only the departmental secretaries can save the Australian Public Service.
At present, there is bipartisan agreement that there are too many public servants. I also suspect that many ministers past and present have doubts about the general usefulness of the service.
We do not want secretaries to be risk averse. When they get the job they should see it as an opportunity to make a difference and build an institution that is an asset for the nation. It is a leadership role and they should lead.
Secretaries are on five-year contracts that give them time to plan and accomplish goals.
Five-year contracts also give the government considerable flexibility while protecting the integrity and independence of the public service.
It would be unfortunate if governments, as a matter of course, developed the habit of sacking secretaries on coming to office to settle old scores or pour encourager les autres.
I fear that for one side of politics to make it their modus operandi, then partisan learning will lead the other side to follow suit.
That would be a very bad outcome.
A cowed, risk-averse cadre of secretaries is bad for the Australian Public Service but it is also bad for ministers as it lowers the quality of the advice coming to them.
Both sides of politics should accept that an imaginative, useful public service is in everyone’s interest and behave accordingly.
But at the end of the day, prime ministers determine how government runs in Canberra.
If the public service is to perform the key role that it should, then the Prime Minister needs to view secretaries and the service as important assets that strengthen the prime minister’s capacity to manage an agenda and run an effective government.
Dr Don Russell was secretary of the Department of Industry from June 2011 to September 2013, and former advisor to Paul Keating. This article is drawn from an address to the ANU’s Crawford School of Public Policy last night.