In the last Informant I wrote about the absence of public service policy statements from the major parties. Three days later, Labor's finance spokesperson Katy Gallagher released the Australian Labor Party's public service plans. Coincidence? Probably - you be the judge. What's important is that the policy directions proposed for the public service are now in the public domain.
So what does Labor plan should it win government? The statement criticises the current government for "wasting money on excessive and expensive temporary labour hire contracts" and promises "an audit of employment arrangements across the Australian Public Service to ensure temporary forms of work are being used appropriately".
The primary reason agencies use labour hire firms is Average Staffing Level caps. When an agency is not allowed to employ enough public servants to do the work required it has little option but to turn to contractors. Labor proposes to "abolish the arbitrary staffing cap which has eroded internal capability, reduced job security and wasted public money with exorbitantly expensive labour hire arrangements".
There is also a strong indication that Labor would support increased public service wages, tied to productivity improvements and service outcomes.
Australia's low wage growth is a puzzle - in economic theory, at our current low levels of unemployment wages should be growing much faster.
The Reserve Bank has identified government policies that have depressed growth in public service wages as one of the important factors. Other observers argue a decline in unionisation, obstacles to industrial action, and a rise in insecure contracts are key drivers. Governments at both Commonwealth and state level have discouraged public sector wage growth, fearful of the impacts on their budget balance.
In a speech to the National Press Club earlier this year, RBA governor Philip Lowe addressed slow wages growth. He said "inertia stems from multi-year enterprise agreements, the review of award wages that takes place on an annual basis and public sector wages policies".
A change at Commonwealth level will only go part way to addressing the RBA concerns - the vast majority of Australia's public servants are employed by state governments. However, a lead from the Commonwealth may encourage wage movement at the state level too.
In an interview published the day after her piece in The Canberra Times Senator Gallagher added further details on the ALP's approach to the public service. She foreshadowed a more important role for the Australian Public Service Commission while reiterating the ALP's intention to remove the ASL staffing cap and reduce use of labour hire firms.
The task of rebuilding policy capacity in the public service will be arduous. At present, the response from some departments, were they to be asked how they could reduce reliance on consultants, would be "don't know, minister. We need to get a consultant to review that".
There is such a level of dependence that an incoming government will be unable to implement its policies, in the short term, without use of consultants and contractors. The capacity of the public service to do the job can be built only with time and patience. A new Labor government would need to be prepared to delay implementation of its policy agenda until capacity in the public service rebuilds - or continue to rely on consultants.
Not only that, but consulting firms have assiduously cultivated opposition figures they judge could potentially become ministers were Labor elected - targeting the ones consulting firms think can be swayed. Those ministers will follow the party line in public, but in private are likely to be reluctant for their departments to reduce spending on consultants.
There's not much more detail in the Labor plans - in keeping with the "small target" strategy - although there is a commitment to revisit the Thodey review. That may be a mistake - the review was limited in scope and its recommendations vague and aspirational (it was criticised by other Informant authors at the time). A more thorough and fundamental review of the public service is overdue.
Coalition policies for the public service were outlined in the preface to Budget Paper 4 last week, signed by Finance Minister Simon Birmingham. It commends the APS for a "culture of excellence", noting "the professional capability and capacity of the APS are essential to effective government administration".
The preface notes growth in the public service, especially in Defence, but that overall departmental funding is expected to decline over the next four years as a share of total government expenses due to "improved productivity and efficiency in the public service". Caps on staff numbers and efficiency dividends are thus likely to stay should the Coalition be returned to office at the next election.
The priority for public sector capability improvement is data and technology, outlined under both capability and digital government services headings. There is also a commitment to regionalisation, with "$15.2 million over seven years to establish APS Hubs in regional Australia...in multi agency work spaces". Housing different agencies together will "locate staff closer to the communities they serve, while breaking down silos to broaden their perspectives". There will also be funding for digital and data training in regional areas.
Linked to this is the promotion of joined up government. The term was introduced by the Labour government in the United Kingdom under Tony Blair in 1997 and referred to integration of government service delivery. In the 2022 Australian budget it means something altogether different: joining up government with the private sector, including consultants and small business suppliers. The government sees advantages in using the private sector for government services: "cutting edge skills and technological advances...commercial experience...independent views and assurance".
The economic and fiscal strategy published with the budget among other things commits to "controlling expenditure growth while maintaining the efficiency and quality of government spending and... essential services".
In the previous COVID-19 phase of the budget strategy there was considerable additional funding provided to the public service. That's gone. Now that the government is prioritising a "transition to private sector-led growth", the public service (except in Defence, where funding is growing rapidly) will need to adjust.
The Greens, unlikely ever to form government in their own right, can be more adventurous and detailed with their public service policy. It is worth considering because they might be part of a minority government or exercise influence in the Senate.
Like Labor, the Greens will abolish the staffing cap. They go further, promising to restore staffing to match 2012 levels, increase public sector wages by 4 per cent per annum for the next four years (referring to Reserve Bank governor Philip Lowe) and work towards ending performance-based pay.
To reduce politicisation and ensure independence of secretary and statutory appointments, the Greens propose such appointments be made on the recommendation of an advisory panel including the APS Commissioner, secretary of the Department of the Prime Minister and Cabinet and a worker representative of the agency concerned. This must be unanimous and reported to the Parliament. Appointment of the APS Commissioner would be subject to consultation with the Parliament's Joint Committee of Public Accounts and Audit.
It sounds good, but is unlikely to work in practice. It requires a JCPAA genuinely independent of government and smart and brave enough to find an independent public service commissioner; a commissioner and secretary of PM&C not influenced by political considerations themselves; and if they are, a worker representative prepared to reject the choice of the other two panel members (which would seem a fairly career limiting move).
Blatantly political appointees may not get through, but mostly that's not what serious critics of politicisation are worried about. It is not party-political allegiances that matter so much as a senior executive's biddability by ministers and their staff. Public Service Minister Ben Morton strenuously rejects the criticism about politicisation - and in the narrow sense of whether appointees are party affiliated, he's largely right (with exceptions like some appointments to the Administrative Appeals Tribunal).
Where the problem arises is senior public servants thinking their role is to help ministers with politics, not policy, egged on by ministerial staff whose numbers and power continue to grow. Sadly, none of the parties' public service policies address this core problem.
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