The Public Sector Informant

Confusion at the top: John Lloyd and Martin Parkinson's conflicting views on public service

The two professional heads of the APS seem to have contradictory ideas about what's hampering the bureaucracy.

It's possible this column is becoming a little self-conscious about the amount of space, portions of it critical, it's devoted to the Public Service Commissioner, the Honourable John Lloyd PSM.

Lloyd, however, occupies an important position in the central management of the Commonwealth's administration, to which the Informant is dedicated to covering, and it would be odd if he did not have a prominent part in its pages.

Moreover, while the commissioner has been sound in some respects, in others he has veered between the controversial and putting his foot squarely in the middle of it. For example, he reckons:

  • The Freedom of Information Act has had a "pernicious" effect on public service policy advising. Comment: Despite the self-interested cries of some senior officials ever since the legislation was first mooted in the 1970s, this is nonsense. The act contains perfectly adequate protections against the disclosure of materials prepared as part of deliberative policy formulation and other processes. Leaking (on which Lloyd holds a commendable position) and the poor behaviour of some ministers and their staff are the genuinely pernicious influences. The FoI Act cannot take the rap for inadequate policy advice.
  • The FOI Act was introduced to enable people to access their personal information held by governments. Comment: That is factually wrong. The act's purpose was to make governments more democratically accountable by giving citizens access to government information unless the public interest required it to be exempt from disclosure.
  • Performance-based selection criteria have had their day. Comment: This is a curious view for a public service commissioner, part of whose responsibility is to uphold merit in staffing, because the removal of such criteria would weaken the standards of merit in appointments and promotions.

Without excusing any such silliness, there may be grounds for cutting Lloyd some slack.


While the commissioner sets a range of personnel policies and reports publicly on their administration, the Public Service Commission has few transactional powers and Lloyd has given a few away. That is to say, apart from exhortation and the possibility of shaming departments by reporting on their failings, the commissioner doesn't have much oomph to bend departments to his will.

Further, when he became the commissioner, Lloyd inherited a public service remuneration policy that is economically irrational, unable to be honestly implemented, is shrouded in secrecy and, because it ignores outside labour markets, puts at risk the ability of departments to recruit effectively and fairly. With all the qualifications to be a fully paid-up member of the industrial relations club and a career confined almost entirely to the public sector, Lloyd would understand this and it could reasonably be assumed that, in the best traditions of frank, fearless and competent advice, he has suggested to the government that it junk the absurd and fraudulent policy. If so, his advice has clearly been rebuffed and he's been left with a putrid policy albatross, the administration of which has cast a shadow over his position and the commission, and distracted departments and their staff.

Perhaps this is why the Productivity Commission report on industrial relations last year dodged making any recommendations on public sector remuneration. It rightly observed that "there are fundamental impracticalities in strongly linking pay and productivity in the public sector". It did not, however, have the guts or the intellectual heft to recommend the bleedin' obvious: that public sector remuneration should be set so as to make it reasonably competitive in the wider labour market.

Anyway, none of these awkward influences on the commissioner's position has inhibited Lloyd from again wading into controversy. A former departmental secretary and public service commissioner, Andrew Podger, wrote recently in the Financial Review about a "loss of capability in the Australian Public Service" and the risk that cuts could leave it "lacking in self-confidence". Podger urged Lloyd and Finance Department secretary Jane Halton "to move on from the side issue of 'red tape' " and concentrate on more important things. This was too much for Lloyd and he lodged a rejoinder with the Financial Review.

No doubt Podger's relegation of "red tape" got up Lloyd's nostrils because he thinks it is "a critical issue" on which "Australia rates poorly in world rankings". In fact, Australia ranks well by international standards on regulatory burden and, while an eye should be kept on "red tape" in the public service, there is no evidence that it's a first-order issue. Moreover, it's been dealt with very well by Barbara Belcher in a report she authored last year.

In Lloyd's time at the helm, the Public Service Commission has issued two circulars listing steps he's taken to lessen regulation in personnel management. Except for the removal of the Abbott government-imposed recruitment restrictions, all of the measures are third or fourth order and some of them, like allowing ongoing staff to convert to non-ongoing without a selection process, are trivial.

Further, in the summary assessments in a sample of 11 of the capability reviews organised by the commission, there are only two minor, passing references to regulatory burden affecting capability.

As a general rule, when people start carrying on in pejorative ways about "red tape", bystanders should reach for their portable shovels because they will soon be knee-deep in malodorous material.

More importantly, Lloyd contests Podger's claims about loss of capacity and self-confidence in the APS. He says the "public service continues to be highly functioning and robust" and asserts that its advice to governments is "thorough, identifies choices and frankly canvasses the implications of the options". Lloyd then lists things now being done to keep the public service up to mark. Some of his points are convincing. Others are not. For example, he says:

  • the public service "strives to attract the best and brightest" – but that's a big ask when its remuneration policy turns a blind eye to the labour market; and
  • "we are determined to encourage more interchange between the public and private sector" – but the commission's efforts to do so are a pale shadow of an interchange program operated by the former Public Service Board. That is to say, on this front, things have gone significantly backwards.

In general, however, Lloyd's response to Podger would have been more effective if, rather than talking about good things in the APS, he had addressed the claims about possible losses in capability and self-confidence. He did not.

Coming to grips with such matters is difficult and there inevitably will be differences between departments. Nevertheless, although they have many complimentary things to say, the reports of the commission's capability reviews indicate a range of weaknesses in policy analysis, service delivery, internal coordination and communication, engagement with external parties, IT, risk management and more, sufficient to create a reasonable suspicion that, in many areas, things have, indeed, gone backwards.

The often slippery evidence about reduced capability is supported by the views of some informed insiders who have, over recent years, observed the working of the system at first hand. And what better witness could there be than the former Treasury secretary and new secretary of the Department of the Prime Minister and Cabinet, Martin Parkinson. He has said:

"The blurring of boundaries between the public servant and the political adviser, and the relentless focus on message over substance, results in a diminution of the 'space' in which the independent adviser can operate. Becoming an effective policy adviser also requires 'learning by doing' under the guidance of experienced hands – an apprenticeship, if you will. Today, in some institutions, smart people look around at their colleagues and find there is no one to talk to, to learn from, who has experience in delivering real reform. The combination of these two things is a decline in the quality of advice and an erosion of capability, to the detriment of good government."

That is to say, Parkinson's view is almost the same as Podger's and distinctly different from Lloyd's.

Lloyd, too, is a witness to the APS's evolution and his opinions should have their place if they are sound. It should be noted, however, that the scope of his observations of longer-term trends is more restricted than Parkinson's; Lloyd only returned to the fold late in 2014 after being away for some years.

The positions now occupied by Parkinson and Lloyd, along with Halton at Finance, are responsible for the central direction and management of the public service as a whole. Parkinson is the nominal head of the APS.

If this trio is to do its very best, it will be important for it to have a common understanding about trends in the evolution of the public service and what needs to be done to make it better. At the moment, there appear to be significant differences between Parkinson and Lloyd. If he's not already done so, the commissioner should seek an early appointment with Parkinson to see if they can resolve their apparently differing understandings about the APS's recent history and its present condition. After that, they could rope in Halton and see if they can agree on, wait for it, "a vision for the way forward".

Paddy Gourley is a former senior public servant.


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