As the Thodey review of the public service recedes in the rear view mirror, it's worth remembering that it got some things right. That's notable because it was not an independent review and it hobbled itself with methodologies based significantly on focus groups, a gullibility about unsupported and anonymous assertions and a neglect of critical evidence. Its reports were a mélange of management jargon and cliché in which the distracting gods of dynamism, agility and innovation were accorded undue obeisance.
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Yet in recommending that the Public Service Commission "review SES and non-SES classification levels and structures", Thodey hit a worthy target. It was less fortunate that he then went on to suggest that in light of the review the "Secretaries Board...consider consolidating management and operating levels across the APS", a task beyond the legal powers and competence of that secretive body.
Not unsurprisingly, Thodey got to the classification review for a mix of wrong reasons - a distaste for hierarchy (who doesn't hate it?), worries about narrow spans of management control, distrust of "traditional means of working" and a desire for "iterative delivery cycles", among other things. Misadventure can be an unpredictable handmaiden.
The public service classification system warrants review because:
- Government policy has made it impossible to keep the structure in a properly competitive position with levels of remuneration paid by outside employers - that is to say, the structure does not provide a reliable basis for recruitment and retention.
- There has been an immense increase in the proportion of higher classified positions that cannot be explained by changes in the nature of work. For example, in 1974 there were 18 deputy secretary positions in a vastly more complex public service of some 280 000 staff. In December 2020, there are 132 such positions for a total staff of 148 736, an increase of more than 600 per cent, trends incisively addressed 10 years ago by the Beale review of the SES.
- Devolved pay and conditions fixing has made a mockery of classifications because it has caused positions at the same level (that is doing work of the same value) to be paid at different levels of remuneration. That is, devolved industrial bargaining does not fit with a rational Service-wide classification structure.
- The differing levels of remuneration for positions at the same classification has in turn undermined promotion and staff mobility. For example, it can mean that a promotion need not involve a significant or any increase in pay, a fundamental bulwark of any promotion system.
- Technological change has had effects on much of the workforce.
These and related considerations were ignored or insufficiently addressed by the Thodey review.
Anyway, the PSC is now moving on the Thodey classification recommendation. In doing so it has:
- Engaged two former departmental secretaries (Dr Heather Smith and Mr Finn Pratt and a former member of the Reserve Bank board Ms Kathryn Fagg, all presumably with impressive knowledge and understanding of the theory and practice of job classification, to help supervise the review. Let's not worry that this imports greater hierarchy and narrows spans of control, features anathematised by Thodey..
- Hired consultants, the Nous Group. In a touching tribute to the depth of Public Service Commissioner Peter Woolcott's commitment to the Public Service Act "value" of openness and accountability, the PSC declined to say what Nous has been tasked to do or what it will be paid, instead inviting a search of the Austender lists. They reveal that Nous is to be paid $807 950 over four months although the PSC won't tell you what the consultants are to do. So, just be happy the PSC is spending your money on something.
- Issued a discussion paper as a basis for consultation however departments and unions have been left to volunteer comments rather than being asked to provide them. That is to say, at this stage the scope of consultation has been restricted.
The review is required to make recommendations that will "streamline decision making", permit "delegation to the lowest level possible", provide appropriate "spans of control" and result in "clear workforce management guidelines". It is prohibited, however, from considering government's absurd "remuneration settings" or the "enterprise bargaining framework".
The six page discussion paper to which a few questions are appended, is disappointingly thin. While it contains a page or two of high level statistics and the obligatory references to "agile teams", "faster results" etc, it is more notable for what it doesn't say. There are no definitions, no explanation of classification theory, purpose and practice, no reflection on the history of classification development in the public service, no outline of its connection to recruitment and retention, promotion and staff mobility including the specification of entry, advancement and training requirements, and on and on.
Publication of responses to the discussion paper is promised although it might be wise to keep one's expectations on a leash about them. There may be interest, however, in what, if anything, Phil Gaetjens (the Prime Minister and Cabinet supremo and nominal head of the public service) and Rosemary Huxtable, whose Finance Department has relevant responsibilities, have to offer. Here's hoping they've been agile enough to hop on their "iterative delivery cycles" and lodge their views.
So, at this stage pessimism comes easier than optimism.
The sad facts are that for many years government remuneration policy and the actions of the heads of departments and agencies have debauched the classification structure while allowing a once considerable core of relevant expertise about classification practice to fade away. Thus the PSC has got in former senior officials and management consultants to do what it should be able to accomplish off its own bat.
So what should Dr Smith, Mr Pratt, Ms Fagg and Nous now do? Most importantly, they should draw on major best practice previous reforms to public service classification structures in the 1980s, but more particularly in the 1960s. The top to tail changes in classification structures in the '60s thoroughly re-organised the nature of work, professionalised it, hugely improved efficiency and effectiveness and made that period the most significant period of management and organisational improvement in the public service's history. It addressed problems similar to those now afflicting the service - a workforce with remuneration disconnected from the outside labour market, a mish-mash of uneven classifications and a system undermining effective recruitment, promotion and staff mobility. Its lessons for today are critically important and if Dr Smith, Mr Pratt, Ms Fagg and Nous are unable to draw them out, they should consider their positions.
In the early 1960s two major cases before the then-Conciliation and Arbitration Commission enabled new classification structures to be developed for engineers in ways not previously feasible. Seizing this precedent, the Public Service Board, in close consultation with departments, staff and unions, set out painstakingly to examine the nature of all occupational categories in the public service and develop appropriate classification structures, including entry and training and advancement requirements, for those occupations. Work was then re-organised around the new structures. This was not a matter of bashing down hierarchies, broadening spans of control and delegating responsibilities in an abstract way - that's getting the cart before the horse. Nor was it a matter of putting out a six page discussion paper with a few innocuous questions in the hope that someone, anyone, might make a few comments. It was a matter actively engaging with all relevant parties, carefully analysing the nature of the work, seeing how it could best be divided up by levels and adopting consequent hierarchies, spans of control and allocation of responsibilities that enable the work to be done in the best way.
The PSC and its expert advisers will delude themselves if they think they can get by with a limited consultation based on a flimsy discussion paper and a desk-top exercise conducted far away from the coalface. Lifting the classification structure from its current dysfunctional state will require the time consuming hard yards of detailed work analysis occupation by occupation. Even with that however the structure will continue to be hopelessly compromised by agency-based industrial relations bargaining and Minister Ben Morton's bone-headed remuneration policy, one of the most bizarre inventions in the history of Commonwealth public administration which links public service pay to an irrelevant index of private sector wage movements whose only merit is that it produces lagged and low levels of increases.
- Paddy Gourley is a former senior public servant. pdg@home.netspeed.com.au.
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