Public servants are in the firing line after Nationals senator Bridget McKenzie pressed the central agency over how it will ensure impartiality regarding the Indigenous Voice to Parliament.
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The Albanese government is expected to introduce legislation in the second half of this year, triggering a referendum to enshrine an Indigenous Voice in the constitution.
Senator McKenzie raised concerns over whether public servants, including agency heads, were being reminded of the consequences of taking a side, in what she called a "partisan" issue.
APS commissioner Peter Woolcott said it was an "emotional debate" and his team were at work to issue helpful guidance to bureaucrats, refusing to be drawn in by the senator's questioning over penalties.
Mr Woolcott, whose term in the top job is due to end later this year, said he was focused on "balancing all the various aspects" related to the upcoming referendum
"I've talked about the three - the need to support government as best we can with regard to policy and advice and the need to make sure that we have workplaces where First Nations people are comfortable," Mr Woolcott said on Tuesday morning.
"And three, impartiality is actually fundamental to our public service ... a lot of common sense will be needed."
Senator McKenzie, who as part of the Nationals Party will be not be supporting the Voice, pointed out a section of the Public Service Act, which requires bureaucrats to be apolitical and work impartiality.
"What is the penalty for department secretaries or agency heads for taking a view on either side of the forthcoming referendum?" she said.
"I can't get into into hypotheticals," Mr Woolcott said in response.
The Victorian senator also asked Mr Woolcott whether the public service commission had made it clear to agency heads it was against the code to allow "posters, collateral, internal memos, chain emails and social media" advocating for either side within the workplace.
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"I don't think I need to do that. I think we need to provide some overall guidance," Mr Woolcott said.
"The agency heads, they are sophisticated operators, they understand the context in which they're operating. They understand the Public Service Act and they understand the code."
A referendum for the Voice is almost certain later this year with the Greens last week agreeing to support the legislation following the departure of Lidia Thorpe from the party.
The Labor government will need to gain the support of two crossbenchers in the upper house in addition to the Greens' support to trigger the vote.
Prime Minister Anthony Albanese has repeatedly called for politicians on all sides of the chamber to come together and support the proposed Voice to Parliament.
Mr Albanese said politicians should reject the "false choice" critics have posed between constitutional recognition and practical outcomes for Aboriginal and Torres Strait Islander people.