CensusFail: is the Australian Public Service competent?
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CensusFail: is the Australian Public Service competent?

What does the census debacle tell us about the bureaucracy's capacity and its changing role?

On August 9, 2016, history was to be made. Australia was to do its first online census. But it didn't go as planned. Vast numbers of Australians found themselves locked out of the census website. A denial of service attack, and a series of problems, brought the census to a sudden halt. The hash tag #censusfail dominated social media, trending on Twitter not just in Australia but around the world.

Fingers were pointed at the Australian Bureau of Statistics, at the systems provider IBM, at the government and at the former Labor government.

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The Community and Public Sector Union blamed cuts that, it said, had reduced the ABS's staff by 700 since the last census five years earlier.

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In light of all this, we ask: is the Australian Public Service competent? Was the ABS census fail a one-off or part of a pattern of public service failure underpinned by poor corporate memory, vague accountability processes and perhaps poor leadership?

Prime Minister Malcolm Turnbull on the day after the 2016 census.

Prime Minister Malcolm Turnbull on the day after the 2016 census.

Glyn Davis: Helen Sullivan, your expertise in public sector governance in Australia and Britain is a great starting point. What should we make of the issues at the ABS?

Helen Sullivan: It tells us something about our attitude to risk in the public sector. Lots of people pointed fingers in lots of different directions, and politicians made of this what they wanted to. I found Productivity Commission chairman Peter Harris's comments interesting; he said the digital revolution is here to stay and we need to find a way of coping with it. We constantly say that the public service should be prepared to take risks; it should be prepared to fail; it should be prepared to fail in order to learn.

There's an argument that this was an opportunity to learn. But to connect it to a series of public service failures in the way that people have is misplaced. There's something particular about the government and public service's problems with IT that is worth looking into. But what interests me is what it says about the public and its attitude to public service risk.

Davis: Terry Moran, you've held very senior positions at state and national level. Has the public service lost the plot?

Assistant Treasurer Michael McCormack and Australian Statistician David Kalisch explain the outage to media.

Assistant Treasurer Michael McCormack and Australian Statistician David Kalisch explain the outage to media.Credit:Andrew Meares

Terry Moran: When I started as a junior public servant, having graduated from university, the ABS was widely admired, revered even, for its competence. It attracted remarkably good graduates in statistics, economics and other disciplines, many of whom went on to be celebrated and successful departmental heads. The ABS's new director, David Kalisch, was before that a successful head of the Australian Institute of Health and Welfare, which collected and published statistics in that area. I don't doubt his competence at all. But he's gone to an ABS that's been ravaged by both sides of politics – they've removed staff and failed to invest in the ABS's IT infrastructure.

This problem afflicts other parts of government. It affects Centrelink, the Tax Office and various other areas. It's symptomatic of the political class's unwillingness to put boundaries around its ambitions for what will be done, so they will be done at a sufficient standard. I don't blame the poor people at the ABS who've been dealing with this; I blame successive governments that have denied investment in the ABS, and also, in this case, the foolishness of outsourcing so much of the collection task to the private sector without equipping the ABS to be a strong and informed client of those companies, as it would need to be in a very complex area like IT.

Glyn Davis with Terry Moran and Helen Sullivan.

Glyn Davis with Terry Moran and Helen Sullivan. Credit:University of Melbourne

Davis: So you buy the argument of the CPSU: that significant cuts contributed to this outcome?

Moran: There's some truth in it.

Davis: Have workloads risen across the public sector?

Moran: In the case of the ABS, it has gradually shed some of its surveys. It's contracted. Each government has contributed to that. It's The ABS is probably not collecting as much as it wishes to collect, and maybe that's accompanied the downsizing in its staff numbers over time. I'm not equipped with enough information to know. But the ABS is essential to active, competent economic management of Australia. Whatever is wrong, because of the way it's been treated in the past, must be put right, otherwise we're taking risks with the economy, with social policy, with environmental policy, all sorts of things.

Davis: Helen, can you take up this theme of privatisation and what it means to lose significant numbers of senior staff and the corporate experience that goes with them?

Sullivan: It's clear there's a case to answer in terms of privatisation and governments of all stripes' enthusiasm for it, and their apparent inability to understand that some things can be privatised, some things can be contracted out, and other things can't and shouldn't. There's an awful lot of learning already out there about the success or otherwise of privatisation of contracting. What I don't buy, though, in Terry's comments, is that somehow the ABS is not culpable because it wasn't trained in being an informed client.

Governments have been contracting for years. This isn't new; it's not something we've never tried before. We have lots of experience of contracting. So if the ABS wasn't able to be a good client, it ought to look at why that's the case. It's not good enough to say it's because it doesn't have enough staff or because they weren't trained to do that. This is something that's core to how governments operate. So that doesn't cut it for me.

Moran: I'm not saying the staff cuts are directly linked to how effective the ABS was in managing contracts with a number of companies. But, generally speaking, in Canberra, in the public service, there's a deficiency in how outsourcing is handled. Last year, the Centre for Policy Development released a new report called Grand Alibis, which looked at the outsourcing of employment services. Generally speaking, employment services have failed to serve those most in need of them. Vocational education and training is off the rails largely because of an attempt at outsourcing that was ill-conceived and poorly delivered.

All the time, we see things proposed for outsourcing, without evaluating whether you get a better result, and without doing what used to be done with public sector contracts for infrastructure through public-private partnerships, where you needed to have two things: the tendered price and the public sector comparator (the public sector comparator defining what a traditional build through public service means would cost). We don't do that with outsourcing anymore. That, linked to the fact that the results aren't evaluated – we're just not checking what's happening and we're not adequately addressing the problems that even become apparent through the administrative data – is a minor scandal.

Davis: Helen, how do we ensure that public sector organisations that outsource have the capability to design the program properly to monitor it, to make it effective?

Sullivan: The skills and capacities are there. The public service is full of people who are very smart, very capable. But they just have too many things to do. They're responding constantly to tomorrow's big thing, which always turns out to be something else by the time you get to tomorrow. So there isn't the necessary attention paid to doing the kinds of things that Terry was talking about. All of those things are what you would want to happen in a good process. Yet they don't happen, partly because there are too many other things pulling on public service time.

Terry talked about the ways in which the public service has been cut, streamlined, subject to efficiency dividends and so on. The one group of people who could perhaps have intervened more effectively are the secretaries: the people at the most senior level. They have the ear of the minister. They are across the evidence. They know what we've tried before, what doesn't work. I just wonder if, in the way in which we now employ senior people in the public service, there is a point at which they've become less able to be frank and fearless.

Moran: That's a different argument. In Canberra, there are several things happening. First, not all of the public service is in conventional ministerial departments of state. In fact, the greater number of employees at the federal level, as well as the state level, are employed under various acts of Parliament with their own governance structures and are, to an extent, sheltered from ministers.

In the way government works, that sheltering is done by the poor sods who work in departments. That engagement with ministers – as you say, Helen – has become a lot more detailed and intensive. It is a distraction. I would argue that, in Canberra, the public service now is essentially made up of two tribes: the economists and the generalists. The economists are hoping to relive the glory days of macro- and microeconomic reform that began in the 1980s, and the debates which preceded it.

The generalists are skilled at feeding the beast in Parliament House rather than equipped with the management skills of all sorts – not just IT and outsourcing – needed to run complex service delivery arrangements. So when a public servant in a social policy department in Canberra looks out on the big service delivery systems operated by the states and territories, they're uncomprehending of what's involved. They simply are not up to date on where contemporary public sector management has advanced to. Contemporary public sector management includes, as just one small bit, IT and outsourcing.

Sullivan: It's a pretty important bit.

Moran: There are lots of pretty important bits.

Davis: So Terry, Helen drew attention to the key role of secretaries.

Moran: Secretaries are sucked into this moor of Parliament House and all its obsessions and carry-on. They've got to track it and try to manage it, and make sure the disaster doesn't overwhelm everything, while also getting their heads around techniques of public policy and public sector management. Some secretaries are indeed philosopher kings. I think the current secretary of the Department of the Prime Minister and Cabinet is close to being a philosopher king, for example.

Others struggle with the many and varied demands made on them – on a capability basis but also a workload basis. They know there's a problem and they try to equip their senior executives with the knowledge and skills that will see the department or the agency through all the pressures it faces. It's actually worse for secretaries than for a private sector chief executive. It's more complex, more demanding, more itty-bitty detailed as well as broad strategic. It's a wonder the country does as well as it does.

Davis: Helen, as an experienced educator of senior public servants, and someone training the next generation, when you look to the talent pool coming through to the public service, and to the training we are providing, what are our issues?

Sullivan: The issues are how we keep people engaged. There's no shortage of smart people who want to work in the public service. In fact, younger generations now are much more interested in doing good and interesting things than they are in earning lots of money. We don't lack capable potential recruits. What we lack are opportunities to engage them successfully over a long period of time.

So one of the things we did in the School of Government a couple of years ago was review the public sector workforce's needs for the future. One of the things that was extraordinary for us was the degree to which human resource planning was separate from conversations that were going on about new policy demands and new areas of activity. There seems to be a gap, particularly at the state level, between what people know they need to be doing, what the future demands are, and how they're planning for that in their workforce at all levels. That, from a government point of view, is a really important issue.

From an educator's perspective, our task is to recognise that, although we're training people in the art of government, so much now of the art of government is done with other people. So we're asking people to have skills, not just in policy design and in management, but in collaboration, engaging with the community, in being much more politically astute than perhaps they have been in the past. That's very demanding.

Davis: In your recent book, Imagining the 21st Century Public Service Workforce, you suggested we should look for different outcomes from the public sector into the future, and therefore different sorts of people.

Sullivan: That's right. There are some real needs that the public sector hasn't got its head around: the more human skills, if you like. We know the public sector is full of people who are technically expert, whether they be economists or engineers, or whoever they are. We know that in the policy centres we have people with great brains who can think conceptually. What we have much less confidence in is the ability of individuals to manage diverse groups of people, or to even recruit diverse groups of people.

So the skills of collaboration, negotiation, of understanding how to influence will become much more important. Because government is going to take a step back. The public service is going to become more an institution that commissions; that curates. That demands different things to a traditional public service that has a much tighter control of everything.

Moran: Sadly, I don't entirely agree with Helen (which will surprise you). First, there are lots of things going on at the moment. We're seeing a devolution to lower levels of most responsibility for delivering services, where those services haven't in fact been outsourced. It's no longer the case that people sitting at the centre of the ministerial departments are pulling strings that lead all the way down to a school or a TAFE institute or a hospital or a health centre. That devolution is furthest advanced in Victoria, but it's happening quite rapidly in NSW and other states. Recent reforms at a national level have, in some areas like public hospitals, been designed to spur that devolution on.

Second, that means the public sector in its entirety comprises people who are operating most of the workforce out there in big delivery systems under, in effect, contracts for delivery with people at the centre, which specify financial and other constraints. There's an overlay of regulatory activity. Doing that satisfactorily, if you're the head of a public hospital or a principal in a school, requires a different set of skills to the policy worker at the centre.

That, in turn, means that the centres, particularly in Canberra, are shrinking, and they'll shrink further. Because there's less for them to do beyond general policy, strategy for delivery, figuring out what the standard price should be for different sorts of services, holding people accountable for delivering those services, supporting ministers in dealing with all of this, and supporting ministers making key appointments to boards and councils and so forth. So the Commonwealth is almost out of many areas of service delivery, although the public ...

Davis: But isn't that completely consistent with Helen's argument about curation?

Moran: Well, except that, at the centre, you need skills in policy and strategic planning of the sort that you don't need to the same extent at all if you're running a hospital. My final point would be that, while we've been really committed as a public sector to economics as the wellspring of policy for 30 years or more, because the public is out of love with that and we've really squeezed as much out of that particular lemon as we can get, we need to face a debate over the next few years about what the central focus is for policy for the country (at least domestic policy). While we wait, the public service in Canberra, with its split between generalists and economists, is a little bit at sea because it's not apparent where the politicians want to go.

Davis: Terry, what do you expect to be the big learnings from census 2016, and how would you like to see that change flow through?

Moran: There are several. First, if you're going to make a big, sweeping change like this, you need to both invest a lot in making the change, and really double up on checking that it's all going to work. You don't roll it out until you've actually run it live with a large population, which you could conceivably do with, say, a large survey that doesn't involve the entire population responding. Second, the denial of service issue is going to become more pressing as time goes on. It won't just be teenagers in lounge rooms who are causing difficulties; it will be governments that are causing difficulties.

By then, I hope the ABS has found a way to assure us all that the data that we offer is indeed secure, and that the process of getting it isn't going to be maliciously disrupted so easily, as appears to have been the case this time. The big challenge in this area that governments face, beyond making the digital transition, will be the security of their digital systems. Because the sophistication of what's possible is immense and will grow over time. We probably can't have certainty that, in migrating to a digital census, it's all going to be sweet, pleasant, easy and secure in five years' time.

Sullivan: I agree with all of that. What's fascinating, though, is the extent to which we as citizens are much more sceptical about giving the government data digitally, whereas we're entirely prepared to hand over who knows what kinds of data in the virtual realm – to Google and to any number of social media platforms. There's something particular about our relationship with government that demands more. So we also need to think about ourselves as citizens and why we are prepared to give away so much data in other forums that perhaps we think about more when we're engaging with government.

Davis: Terry, what does this rather conspicuous public failure mean for credibility?

Moran: It has some impact but I think it will pass. We need to wait until we see the results of a detailed inquiry into what went wrong. There's already a view emerging that the contractors made some terrible mistakes, but time will tell whether that's the case. If they did, that will take some of the pressure off the ABS. Otherwise, we know from attitude surveys that the group that the community has the highest regard for are frontline, service-delivery public servants. Their regard for those people is many times greater than it is for business leaders or, sadly, parliamentarians.

Davis: Helen, a complicated story about why a census goes wrong raises difficult questions about accountability. What should we learn from this?

Sullivan: We should be reminded that accountability is incredibly precious, and that once you've broken that accountability it's very difficult to get back. Terry alludes to the regard in which frontline workers are held. That's right. But we also know that all institutions, whether they're governmental, private sector, or even in Australia now the not-for-profit sector, are much less trusted than they used to be. Some of that is about accountability. But the more hands you have delivering a service, the more complex accountability will be. So we need to think differently about how we hold people to account.

Davis: So when the relevant minister says, I've only been the minister for three weeks so count me out, that's a reasonable claim?

Sullivan: No. But we need to have a clearer understanding of the line of accountability, and recognise that, often, that line can be broken in many places.

Moran: The minister probably has a reasonable story in having been in the job three weeks. If he'd been diligent, he would have read folders and folders of briefs and tried to absorb them. But who would have told him that the level of risk associated with denial of service was so great that he should stay up all night trying to figure out what do? Having said that, many of the public sector institutions are by far the most respected institutions in Australia. The Reserve Bank, the ABS, the ...

Davis: Universities.

Moran: Universities. Even the Australian Public Service itself is well regarded. People love their local school; they love their hospital, as well. They hate the systems of which they're a part, but they love the local institutions. Most public sector people – and they're about 16 per cent of Australia's workforce – are working in institutions that are highly respected. The defence forces, police, firefighters, nurses, teachers. Against that, I'm not too worried about the ABS, given how it might turn out when the evaluation is properly done.

Sullivan: Terry, you're living in fantasy land.

Moran: Thank you.

Sullivan: People trust their local hospital or their local school, but they do not trust all of the public service. The predominant emotions we're seeing, as a result of the last federal election, are fear and anxiety. It's precisely because people don't know if they can trust institutions; they certainly don't know how to hold institutions to account. One of the things that people are very fearful of is this notion that, somehow, they are all going to become responsible for their own services, their own care, their own education, in ways they never thought they would be, and which certainly don't align with the kind of system of government and public service we have in this country.

Moran: I think we're talking across purposes. I'm talking about where most public sector workers work, and how those institutions and entities are respected. You're talking about a general malaise in our democracy, which I agree exists.

Sullivan: But one is related to the other.

Moran: That might be, but the general malaise is related more to the direction of policy, and what it isn't delivering for people.

Davis: So, a guarded optimism about the future of the public service?

Sullivan: Oh yeah, I have to be optimistic about the future of the public service.

Moran: It's going to be exciting when we start to roll out all the evidence about these stuff-ups and outsourcing. People are going to ask, well, why can't we get the public service to do all these things?

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Davis: So, what have we learned? Well, the census failure is probably the result of a complex interplay of public and private factors. Cutbacks, yes; changes in technology, yes; but also the difficulties of managing outsourcing, and learning how to bring those skills into the public sector. We've learned that secretaries find themselves in very difficult positions, caught between the demands of politicians and the expectations of citizens. We've learned of changes in the public sector, in a sense a stronger policy delivery differentiation, with new skills needed. And we've learned that experts can disagree.

This is an edited transcript from The Policy Shop, a podcast hosted by University of Melbourne vice-chancellor Professor Glyn Davis. Professor Helen Sullivan is the Melbourne School of Government's foundation director. Terry Moran is the Centre of Policy Development's chairman and a former head of the Department of the Prime Minister and Cabinet.

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