Australian Public Service Commission

CHAIR: I welcome commissioners of the Australian Public Service Commission. Mr Sedgwick, do you wish to make an opening statement?

Mr Sedgwick : No.

Senator SINODINOS: My first question relates to the progress of the public service reforms which I think Terry Moran was instrumental in getting off the ground. A certain amount of money was allocated for that. That was cut back in the context of the 2010 election campaign—you had to do more with less, as it were. What sort of progress are you making with those reforms?

Mr Sedgwick : We are making quite good progress. This is a long story, but I will try to make it short. You might remember that one of the large elements of the funding which was cut back had to do with leadership development and talent management—the development of the future leaders of the public service. We had been invited by the blueprint to rethink a contemporary approach to leadership development, to reinvent some of the commission's programs in this space, to try and institutionalise a different approach to managing top talent within the service and to try and provide a facility for the service where the commission served a role as a broker or a provider of quality assurance around good programs. After that money was cut back, we took a proposition to the heads of all the significant agencies—agencies employing more than 200 people—and they have agreed to fund the commission for five years to do that work. So a lot of that work is in hand and we are trialling different parts of that reinvigoration of the leadership development model as we speak. Similarly, there is a body of work around the classification structure in the Australian Public Service and some of the components, including the remuneration arrangements for the Public Service, where some work needs to be done around work level standards below the SES. Colleagues have agreed to fund us to have some of that work done.

When the money was cut back, we were left with enough money in the first year to do a number of quite significant, signature pieces of work. For example, we conducted a trial to see whether we could transplant to Australia a technique called a capability review, which is a high-level look at the capability of organisations—their leadership, their strategy and so on. That trial has been conducted and the government has agreed to continue that activity.

We did some work to review the size of and the causes of growth in the SES. That led to the Beale report, which had a look at what was driving the growth of the SES. It identified those drivers but it in particular identified that there was a degree of inconsistency in the way that work level standards were being applied at the level of the SES. Following that review, the government has agreed to continue with the cap on SES numbers that it put in place 18 months or so ago in order to try and change some of the culture around work level standards.

There has been quite a lot of work done around workforce planning and a lot of work done with agencies to share good practice around workforce planning and to try to get people to look as organisations at not just collections of skills but as systems in which the processes, culture and governance of an organisation go together to determine the capability of the organisation. There has been a lot of work done around recruitment to see if we can share good practice about streamlined approaches to recruitment. There is an awful lot—I could bore you for quite some time. Some of that work has been slowed down because of the budget, but, given the significance of some of the things that we are trying to do and the willingness of colleagues across the system to cooperate, we have also been allowed to achieve quite a bit.

Outside of our purview, others have instituted arrangements to improve the government's oversight of a thing called the strategic policy implementation network. Finance had a look at some things around red tape to see if they can cut that. There has been quite a lot done.

Senator MASON: I want to go to absenteeism in the Australian Public Service. I have been looking at this issue for a few years now, but I am not sure that my interest has made much difference. The most recent data is from The state of the service 2009-10. That report shows that the median absence rate was 10.5 days per employee and the median sick leave was 7.9 and that there has in fact been a steady and continuing increase by 1.6 days of unscheduled absence and 0.9 sick leave days since 2001-02. I drew up, on the basis of the state of the service reports, a graph.

Senator SINODINOS: Did you do that yourself?

Senator MASON: I did not quite do it myself, Senator Sinodinos.

Senator Chris Evans: In the education estimates, he brings a calculator and tries to add up the BER expenditure figures to double-check the department's advice.

CHAIR: Senator Mason, are you seeking to table that document?

Senator MASON: Yes.

CHAIR: The committee will look at it and consider your request.

Senator MASON: Those numbers are right, aren't they, Mr Sedgwick?

Mr Sedgwick : I do not—

Senator MASON: You will notice that in 2001-02 it was 8.9 unscheduled absence. It has steadily been going up to now 10.5 in 2009-10. Sick leave is seven days per year up to 7.9 and the minister is quite right—I got my calculator out before and the unscheduled absence has increased by 18 per cent, according to those figures, and there has been a 13 per cent rise in sick leave since 2001 and 2002, so it is significant. Why does absenteeism in the public service continue to increase, Mr Sedgwick? What is going on?

Mr Sedgwick : Well as you have identified, one of the principal drivers has been sick leave. There is a choice that agencies make between requesting that people who are sick stay away so as not to infect others, or encouraging people to come and infect others—it is called 'presenteeism'. Why from time to time you have upward movements in sick leave is quite unclear. The unscheduled absences cover a whole range of things. Sick leave, as we can see, is the bulk of it but there is also a lot of carer's leave where agencies provide opportunities, particularly for parents to care for their children when they are sick, as part of an employment framework.

Senator MASON: So Mr Sedgwick carer's leave is part of unscheduled absences, is that right?

Mr Sedgwick : Yes.

Senator MASON: And that is rising steadily too?

Mr Sedgwick : The thing about sick leave is that we identify sick leave as being unscheduled, and I guess most of it is, but if someone is seriously ill and they need care or treatment then that is not unscheduled in the sense that I think you might be using it. It is a manifestation of the circumstances that they find themselves in. Our sick leave actually is not bad compared with other public services around the world as we understand the data.

Senator MASON: Except that it keeps going up. I will get to this later but what worries me is the trend. We do not have time tonight to compare it to the private sector. Are you aware of the 2011 Absence Management Survey by Direct Health Solutions?

Mr Sedgwick : I cannot say that I am.

Senator MASON: They reported that absence levels across Australia fell for the first time in three years. The report found that public sector employees took 22½ per cent more time off than those in the private sector and they concluded that the public sector had seen a significant rise in absence levels in last year and that that sector is struggling to find the right balance of managing employees within a context of generous leave entitlements, traditionally 15 days or more per employee per annum.

Mr Sedgwick : As I said to you, as part of their employment terms there are many agencies which have relatively generous allowances for carers leave because they want to present a family friendly face to their employees. We should not be too surprised or in some sense upset if the employer's generosity is respected in those circumstances because family friendliness is an important component.

Senator MASON: Sure. I accept that.

Mr Sedgwick : We are all in the war for talent out there and the public service is known for its willingness and ability to provide reasonably flexible arrangements while nonetheless insisting that the work get done.

Senator MASON: But the taxpayer pays for these benefits.

Mr Sedgwick : Yes and in circumstances in which those benefits lead to a more productive and efficient workforce that is a good thing.

Senator MASON: As long as they do and as long as we can explain why. I still have not heard why. This is what worries me—the minister may be aware of this. During the Howard government I asked questions about this and the previous Public Service Commissioner put together Fostering an attendance culture: a guide for APS agencies. You might remember that, Mr Sedgwick.

Mr Sedgwick : We have certainly had lots of conversations with agencies because if you find—

Senator MASON: Mr Sedgwick, I have not finished my question. That approach has not had a measurable impact on attendance culture within the APS, has it? That is what is worrying to me—the trend is up, not down, up 18 per cent in unscheduled absences and up 13 per cent in sick leave in nine years.

Mr Sedgwick : Yes. It is clear that best practice in the management of sick leave, for example, takes a particularly active interest in circumstances where people appear to have a pattern of leave or in circumstances where there is an illness or an injury that needs to be actively managed, and good practice says that you do actively manage circumstances in which you have got individuals with high levels of leave for reasons that are not clear. That is reasonably common, good HR practice in any organisation.

Senator MASON: Sure, but it keeps going up. What are we doing about it?

Mr Sedgwick : Two things—

Senator MASON: It is going up not just a bit. I mean, that is a lot. Eighteen per cent within 10 years is a lot.

Mr Sedgwick : Two things. One is that I do not actually manage a hundred agencies across the Australian Public Service; I manage my own.

Senator MASON: No, but you are the man responsible for this booklet.

Mr Sedgwick : But we are quite keen—and we have—to share good practice and that is what we tend to do. In these circumstances we encourage good practice and we promulgate good practice.

Senator Chris Evans: I know when I was minister for immigration, Senator, part of the enterprise agreement negotiations was that Immigration was trying to get in an arrangement to lower the unscheduled absence as part of its response to concern about that. One of the things that always struck me was that there was quite a diversity of experience across the department, in fact, and we had very high—

Senator MASON: And across the APS, Minister, as a whole.

Senator Chris Evans: Yes. And we had very high, unscheduled absences in places like the call centres and very low ones among, say, senior policy people in Canberra, so there was quite a different experience occurring, but they were trying to address it through the enterprise agreement. I do not know whether that is still occurring but that certainly was one of the tactics being employed.

Mr Sedgwick : That is still occurring and it is also—

Senator MASON: But it is not working, Mr Sedgwick. This is my concern—it is not working.

Mr Sedgwick : It is certainly true that the sick leave numbers have been edging up but, as I said to you, the dominant reason those numbers have been rising is the use of carer's leave. The provision of carer's leave has been a tactic by organisations to present a family-friendly face to their workforce because they want to be able to do that—

Senator MASON: Yes, but even if you take account of that, sick leave is still going up.

Mr Sedgwick : Even if we take account of that, the sick leave that has been used in the Commonwealth Public Service—

Senator MASON: Thirteen per cent.

Mr Sedgwick : is still less than in the Canadian federal service, for example. In 2010-11, we had 8.4 days per employee per year; Canada is 10.2.

Senator MASON: Mr Sedgwick, can I take it from this that you are happy with these results? Are you happy with these results? With a continuing increase in unscheduled absences and sick leave, you are happy with those results. Are you? And if you are not, what are you doing about it?

Mr Sedgwick : Senator, we are always happy to share good practice to ensure that the amount of sick leave that is taken is appropriate to the circumstances of the case. In circumstances where there is someone who is genuinely ill, we would prefer them to stay home rather than infect their organisation.

Senator MASON: Yes, but this is not one person. Get this right, Mr Sedgwick. This is a systemic, APS-wide increase in unscheduled absences and sick leave. Even keeping carers aside—we can do that—there is still a 13 per cent rise in sick leave. Now, if you think that is a good outcome, I am very surprised. I want to know what you are going to do to ensure that, in fact, it starts to go down.

Mr Sedgwick : We will continue to do what we have been doing for some time. As the—

Senator MASON: It is not working!

Mr Sedgwick : As the minister said to you, there is quite a high level of variability across—

Senator MASON: It is not working, Mr Sedgwick, so what are you going to do about it? What is the status of this document fostering an attendance culture?

Senator Chris Evans: Chair, the senator asked a very appropriate and serious question, but badgering Mr Sedgwick before he can reply is not helpful.

Senator MASON: What are you going to do about it, Mr Sedgwick?

Senator Chris Evans: While I am happy to interchange with the senator on that one, I think Mr Sedgwick ought to be allowed to—

Senator MASON: It is all part of an issue, Minister. This is not—

Senator Chris Evans: No. You asked the question, 'What are you going to do about it?' and he ought to be allowed to answer your question.

Senator MASON: All right, what is he going to do about it?

Mr Sedgwick : There is a high level of variability across the service in the usage of sick leave. We published the numbers in the State of the Service this year. I cannot actually find them now but there is quite a variability across agencies. What we are doing, as we have been doing for quite some time, is to encourage agencies to share good practice and to help each other identify the circumstances in which they need to actively manage sick leave down. But as I said to you—

Senator MASON: But it does not seem to be working. It is not working.

Ms McGregor : I think, as both the minister and Mr Sedgwick have pointed out, there are issues around—usage rates differ with the size of the agency and the nature of the work.

Senator MASON: I accept all that. I know—

Ms McGregor : I will get to my point.

CHAIR: Senator Mason, please. We have conducted these hearings all day without a lot of excitement. We have allowed witnesses—

Senator MASON: This is different.

CHAIR: It is very different. We have a process in estimates of which you, Senator Mason are well aware; that is, you put a question and allow the witness to finish answering. You then have the opportunity to put another question. Please allow the witness to continue her response.

Ms McGregor : What is different this year, which signals a renewed focus on this issue, is the way we have reported these absences in this year's State of the Service report. We have segmented it by small, medium and large agencies. There are different factors at play. We are getting the analysis. In this year's State of the Service report we have also introduced the notion of an employee engagement model. It sounds a bit Zen perhaps. The idea is based on research of the corporate leadership council, where the engagement model addresses engagement with various aspects of the workplace. That is a key factor in terms of people taking leave.

Senator MASON: What are your current policies? You can take that on notice. I am happy for that to happen for the committee. Mr Sedgwick, what is the status of the document Fostering an attendance culture: A guide for APS agencies?

Mr Sedgwick : I have not seen it revised in recent times. It still exists. These conversations about how to manage inappropriate absences have been ongoing for quite some time and we will continue to do that.

Senator MASON: I just want there to be an improvement in sick leave, Mr Sedgwick, as does the taxpayer, I am sure.

Ms McGregor : A final point would be around the bargaining arrangements. The amount of leave that can be taken varies agency by agency. We are trying to harmonise that. Studies show that when you reduce the amount of leave available, less is taken.

CHAIR: Can you clarify whether this is another document that you are circulating?

Senator MASON: I will explain what it is.

CHAIR: If we have a copy of it, we can make an assessment about whether we accept the document.

Senator MASON: It is a public document. It is page 30, State of the Service 2009-10. Is that correct, Mr Sedgwick?

Mr Sedgwick : Senator, I direct you to page 49—

Senator MASON: Mr Sedgwick, I am asking the questions.

CHAIR: First, can we accept this document as being tabled? The committee has now accepted that document. Senator Mason, you have the call.

Senator MASON: This goes to a point raised before by Ms McGregor, which is this: levels of workplace absence by APS agency. That is the point you talk about. There are quite distinct differences amongst agencies depending on the size and culture; I accept that. That is not in dispute and it never has been. We see that page 30 states:

Across agencies, the levels of workplace absence varied widely, from 3.9 to 23.5 days per employee … Most absence rates were less than 16.0 days per employee, similar to last year; however, two small agencies had absence rates of 20.9 and 23.5 days per employee due to small numbers of employees taking substantial periods of leave.

Obviously 23.5 days median absence is a lot—it is almost five working weeks. When you combine that with the four weeks annual leave, you get more than nine weeks. It is a lot. Can you tell the committee what agencies you refer to when you talk about 'two small agencies having absent rates of 20.9 and 23.5 days per employee due to small numbers of employees taking substantial periods of leave'. Ms McGregor, do you know what those are?

Ms McGregor : No, I do not, Senator. I do not have the—

Senator MASON: Can you take it on notice?

Mr Sedgwick : We will take it on notice. I was trying to give you the updated data before, which is in this year's State of the Service report. It is on pages 49 to 51. That data will show you—the names are not there—the unplanned absences for every agency.

Senator MASON: Including the ones I have just referred to? But you will take it on notice anyway?

Mr Sedgwick : Yes, I will take it on notice.

Senator MASON: What is being done in those two agencies to address those issues?

Mr Sedgwick : We will take that on notice too.

Senator MASON: Could you take on notice also what the APS is doing to address absenteeism? The minister knows that I have been asking about this since 2004, and I have to say: it is not getting better; it is getting worse.

Senator Chris Evans: Do you want the question or the answer?

Senator MASON: Both.

Mr Sedgwick : I understand your concern. It is not actually something we control. Our endeavours in this area are to promulgate and share good practice, but this is a matter that individual agencies pursue in their own context and, in circumstances in which you have—

Senator MASON: What is your role, Mr Sedgwick?

Mr Sedgwick : I will come back to that. In circumstances in which you have a small agency and one or two people are seriously ill—

Senator MASON: I understand that.

Mr Sedgwick : then you can end up with large numbers.

Senator MASON: I do not dispute that. I have never disputed any of that. What worries me is the systemic rise, over eight years, and it is significant. This is a big increase and it is steadily rising, and that trend is very, very worrying.

Mr Sedgwick : Yes, and it is—

Senator MASON: And I want to know what you are going to do about it.

Mr Sedgwick : It is an issue that we can quite easily, and do, draw to the attention of individual agencies, but these things need to be managed in the circumstances of individual cases in individual organisations.

Senator MASON: It is not working.

Mr Sedgwick : If somebody is sick, then they need to stay away.

Senator MASON: Hold on. That is true, but that has always been true. The problem is: the trend line is up. That is a pat answer. It is well rehearsed. But it is not going to work with me, as the minister will know. That is a trend line. Fight the trend line.

Mr Sedgwick : I could look at the trend line in expenditure on health in our country and draw some conclusions from that, too. We do tend to spend a lot of time with tests and in queues and things which we did not do 10 years ago.

Senator MASON: I honestly do not know.

Mr Sedgwick : But we have been active in saying to agencies that, if you have high levels of unexplained absence that genuinely are not explicable, you need to look at those and, in circumstances in which individuals repeatedly are taking unexplained leave, then good managers will inquire about and attempt to deal with that. And if the circumstances are what they should be, then fine. If the circumstances are what they should not be, then that is a management exercise.

Senator MASON: It is a management issue; I agree with you on that. But, as I say, it is not working. You can say whatever you like. It is not working. That is the problem.

Senator Chris Evans: You ask a reasonable question and, clearly, there has been an increase in sick leave. The officers have talked about other leave which is being used more and has been offered more, and I have had meetings with private employers lately who are actually moving more into that field themselves because they are trying to attract women back into the workforce. Some of the big engineering contractors were talking to me about those sorts of things as part of them trying to get women back into the workforce who otherwise find difficulty in managing sick children, and still, unfortunately, the responsibility largely falls on women workers.

I do not know how much is in the State of the service report, but my experience when this was an issue in immigration was that you have to get behind the gross figures to work out what is really happening. I do not know whether there is an ageing profile. Certainly in immigration when I was there—and Ms McGregor will probably know more about immigration's experience with this; it was probably her job to fix it at the time when she was there—it was vastly different among different sections of the department. So this graph is helpful in one way, but it does not get behind that—for instance, I would be interested to know what the areas and the types of functions are. And one of the things that sometimes impacts is the employment market. For instance, in some of the call-centre type work which we have moved into in recent years, there is high turnover and high absenteeism because of the nature of the work. So not only is there higher absenteeism but also the staff turnover is quite high.

Senator MASON: I accept that.

Senator Chris Evans: But I think it would be worthwhile, from my point of view, if we did a bit more work, if it is not already done, about what is behind this and what is driving the figures.

Senator MASON: The committee would be happy to receive that.

Mr Sedgwick : We would be happy to—

Senator MASON: Last time it was a spike in influenza. Minister, you may recall—it was not you, Minister; it was a different minister, but I was not satisfied by Ms Briggs's attempt to justify it, that it was all based on influenza. There comes a time when that is just not good enough.

Mr Sedgwick : Senator Evans is right—

Senator MASON: I will come back to you, Mr Sedgwick. But, before I forget: can the committee be provided with full data on absenteeism for every department and agency you have surveyed? I do not think that is in the current report.

Mr Sedgwick : It is not in the report.

Senator MASON: Could the committee please have that?

Mr Sedgwick : I will take that on notice. I do not know the basis of it.

Senator MASON: Yes, that is fine. Finally, if you could do what the minister has suggested and go behind those figures and inform the committee what you are doing to fight this problem, I would be delighted.

Mr Sedgwick : We are a family friendly workplace, so we do expect people to take time off to look after their kids. We are also getting older. The public service workforce—

Senator SINODINOS: Rapidly, I think.

Mr Sedgwick : The public service workforce on average is older than the private sector workforce in Australia. We actually want them to stay on.

Senator MASON: I have actually looked at that. You know where most of the absences are? It is among the young men. Why would that be, I wonder. You were young once, Mr Sedgwick. I was young once.

Mr Sedgwick : I am not sure of that data. I had better check it.

Senator MASON: It is not just because you all of a sudden fall apart when you turn 50, Mr Sedgwick. I have not fallen apart.

Senator Chris Evans: You are suggesting we ought to track the accuracy and the relationship with the one-day cricket schedule. Is that what you are suggesting?

Senator MASON: I think there are other issues.

Senator XENOPHON: Mr Gillespie, some legislation is coming up shortly dealing with the flow through of recommendations the tribunal has made about gold passes, salary increases and the like. Can you advise what powers the tribunal needs in order to have public hearings on the matters the tribunal considers? I note the tribunal went through a very useful exercise of speaking to members of parliament. Historically, has the tribunal been able to seek public submissions, to consult and, if necessary, to have public hearings in relation to its deliberations?

Mr Gillespie : The Remuneration Tribunal Act is pretty open about how the tribunal will undertake its functions. I think section 11, 'Method of inquiry by Tribunal', of the Remuneration Tribunal Act sort of spells it out. In short, it may inform itself in such a manner as it deems fit.

Senator XENOPHON: That means seeking public submissions, conducting public hearings—

Mr Gillespie : No. In some circumstances it could do that. Do not forget that there have been manifold changes since 1973 in the way the jurisdiction of the tribunal has actually worked for different groups under the tribunal's jurisdiction. For parliamentarians, however, I recall that there was a process of public submission from the outset. I do not think the tribunal has ever conducted public hearings, though. I stand to be corrected on that, but I think there was the opportunity for public submissions and there still is the opportunity for public submissions. Indeed, people can make submissions on matters. Whether they are office holders or within the tribunal's jurisdiction or outside the tribunal's jurisdiction, they can make submissions to the tribunal.

Senator XENOPHON: Could you just clarify in relation to prior consultations you had with members of parliament—was there also a public request or public advertising?

Mr Gillespie : On this occasion, no, there was not. But I think the tribunal members spent five days in Canberra talking to 30-plus individual parliamentarians.

Senator XENOPHON: I was one of them.

Mr Gillespie : Do not forget: the tribunal members are all part timers and do not live in Canberra either.

Senator XENOPHON: It is not a criticism of the tribunal. I said it was a worthwhile exercise. But in terms of going that step further to seek public submissions—is that something that the tribunal has considered for any future determinations?

Mr Gillespie : I cannot answer that. All I can say is that the tribunal can do that. I would think that it would be mindful of what the issue might be. Do not forget that the jurisdiction of the tribunal is pretty wide—whether it is federal judges or whether it is public office holders of various kinds. The question would become one of—forgive the phrase—horses for courses. Say the tribunal wants to look at parliamentarians, for example. Does the tribunal seek public submissions on this particular matter? In the tribunal's most recent report, there is a section which deals with the legislative roots of a variety of the entitlements of parliamentarians. I would challenge most parliamentarians to understand exactly how diverse that legislative basis is, so one would need to be fairly circumspect—speaking as an official; not a tribunal member, of course—about what it was you were going to seek public submissions.

Senator XENOPHON: Equity grounds or the appropriateness of increases, comparative pay, justice or whatever—that sort of thing.

Mr Gillespie : All I can say is that there seems to me to be scope within the act for the tribunal to conduct that sort of process. Historically, it did have a process of public submissions but, as I recall it, that was not necessarily consistent either, across the jurisdiction or on every occasion.

Senator XENOPHON: If it were mandated that there be public submissions or, indeed, public hearings, that would still be within the capacity of the tribunal to undertake it?

Mr Gillespie : Let me simply say that the tribunal would be mindful and would abide by whatever the legislative mandate was that governed its operations. What that might mean in terms of consequential resource issues is an open question. For example, were it to be a half-day or a day's public hearing in Canberra with three tribunal members coming up in the morning and going back in the day, folk meeting their own costs et cetera, that is one thing. But were it to be a wide-ranging public consultation process with appearances in the states and bits and pieces, the tribunal's budget is modest—let's just put it that way.

Senator XENOPHON: If I may, Chair, finally, there is the issue of adjusting the superannuation entitlements of MPs who are under the old scheme, because at the moment it is linked to salaries.

Mr Gillespie : It is.

Senator XENOPHON: Can you say whether any advice has been received about any potential legal issues in decoupling that?

Mr Gillespie : The only observation I could make there is that the tribunal made recommendations in that regard. It does not control the superannuation legislation that governs parliamentarians, or any other group in Commonwealth employment at the moment. Similarly, the life gold pass legislation does not belong to the tribunal. It does not administer that. Both those pieces of legislation are in the hands of the Department of Finance and Deregulation and, if you had particular questions about those issues, perhaps it might be best to direct them to that department.

Senator Chris Evans: I never thought that parliament would receive public feedback on politicians' pay. I have received lots of submissions over the years—invited and otherwise.

Senator XENOPHON: Is it publishable though?

Senator Chris Evans: Most are not!

Senator FAULKNER: Mr Sedgwick, are you aware of many questions being directed to the Australian Public Service Commissioner wearing their hat as the Parliamentary Service Commissioner?

Mr Sedgwick : It would be the first in my time.

Senator FAULKNER: Yes, I had wondered if this had occurred. I wanted to briefly ask you, given evidence provided to us by the President of the Senate this morning, as I was interested in those processes. First of all, I understand that historically a small proportion of your role is taken up with your responsibility as Parliamentary Service Commissioner. You might just confirm that for the committee to give us a little feel of how that works within your office.

Mr Sedgwick : Typically, it is tiny but it is variable. Was the President this morning talking about certain selection processes?

Senator FAULKNER: The President gave an opening statement to the committee about the process under way to fill the vacancy in the office of the Secretary of the Department of Parliamentary Services and the role that your office is undertaking in that regard.

Mr Sedgwick : Yes, we are managing the process on behalf of the Presiding Officers.

Senator FAULKNER: Have you been able to draw on previous experience in coming forward or making decisions about the course of action that has been adopted, including the engagement of executive search agencies and the like? I am not critical of this, by the way. I think it is very important that we get a high calibre field and, obviously, a high calibre Secretary of the Department of Parliamentary Services.

Mr Sedgwick : When this issue was raised we consulted both the written and the oral history around these matters. I have actually put a recommendation to the Presiding Officers that, in the circumstances, we would engage an executive search firm to try to make sure that we have a high-quality field. It is not a typical Public Service or even parliamentary service job. It has quite a range of responsibilities, from managing guards at one end to managing the library at the other. There is a range of skills that are not necessarily held in high numbers in parts of the service. Previous experience has been that we get good candidates but the fields were not necessarily strong. Relying on that experience, it was my recommendation to engage the executive search firms.

Senator FAULKNER: So that was your recommendation? I was going to ask you that.

Mr Sedgwick : Yes.

Senator FAULKNER: In his opening statement, the President said:

This is a role—

He is referring to the role of Secretary of the Department of Parliamentary Services—

that has proven difficult to attract a strong field of applicants from standard vacancy advertising and this extra step—

that is, the engagement of executive search agencies—

might serve to produce a larger and stronger field.

I think, from what you are saying, you would definitely reinforce that statement of the President.

Mr Sedgwick : That is right. In fact it was my recommendation and it was unprompted.

Senator FAULKNER: Is the 'request for offer' that is issued to executive search firms developed within your office?

Mr Sedgwick : We put a proposal to the Presiding Officers, which they have accepted.

Senator FAULKNER: Is it appropriate that at some stage the committee might be provided with a copy of the request for offer? Perhaps this is not the right stage of the process. I appreciate that might be the case. I would be seeking your guidance on this.

Mr Sedgwick : I will take advice on that. I cannot see why not, but I will take advice on it.

Senator FAULKNER: I would appreciate that. I also understand that the closing date for the lodgement of proposals in fact was Friday of last week. If you could take advice and let us know, that would be helpful. Does this mean that at the end of the day you will engage one executive search firm, or possibly more than one? That is the thing I was not entirely clear about from the President's statement. It is somewhere between one and three and I was not entirely clear where it landed.

Mr Sedgwick : I see.

Senator Chris Evans: Pick a number.

Mr Sedgwick : I think the honest answer to that is that we will get the best approach that is feasible in the circumstances. Typically it is one. There may be circumstances in which you believe that a combination of firms might offer particular strengths, but that is not particularly common. I wouldn't want to prejudge or forecast the outcome of that process. I expect it would be one. Normally it is one.

Senator FAULKNER: At the conclusion of that process, you will provide a report in accordance with your legislative obligations to the Presiding Officers. Is that correct?

Mr Sedgwick : That is right. My proposal to the Presiding Officers was that I convene a selection committee, which would involve a couple of secretary colleagues from across the service; we would proceed with what is a relatively standard selection process and we would write a report and make a recommendation.

Senator FAULKNER: I note that the timetable the President outlined to us was 'process to be completed by mid-May and the appointee commencing in June'. That is a little longer than I thought, and longer than I had expected the process might take. You might assist us with that.

Mr Sedgwick : We will get that process completed as quickly as it can be done. We understand the importance of ensuring that that office is not left vacant for an undue period of time, so we will be moving as quickly as we can.

Senator FAULKNER: I appreciate the effort that you are putting into this because I think this appointment is a critical one. Having broken new ground by asking the Australian Public Service Commissioner something about their role as Parliamentary Service Commissioner, let's see if we need to follow it through at a later stage. Thank you, Mr Sedgewick. I appreciate it.

Mr Sedgwick : We will be moving that as fast as we can. If we can do it before June, we certainly will.

Senator RYAN: Mr Sedgwick, I would like go back to the State of the service report, particularly with respect to the concerns around bullying in the APS. The report says, 'there has been little change in incidence or reporting over this time' after outlining that 'for a number of years the state of the service report has discussed harassment and bullying in the APS'. It also states, 'there continues to be a problem with harassment in the APS, of a scale that warrants attention'. Is that a fair summary of the issue from the report?

Mr Sedgwick : My recollection of it is slightly different. Bullying and harassment is not to be tolerated anywhere. Often people's understanding, or their perception, of what constitutes bullying and harassment may be inconsistent, but with respect to an objective understanding there are circumstances in which somebody whose performance has not been managed particularly closely for a while, for example, might perceive a manager who is insisting on certain standards as their being bullied or harassed, when in fact what has happened is that the manager is doing their job.

Senator RYAN: I think you are speaking a language that a lot of businesses around Australia might say too, Mr Sedgwick.

Mr Sedgwick : Subject to that—

Senator RYAN: It still appears to say that it is an issue of concern for you and the APS?

Mr Sedgwick : As I say, in the ideal world we would have no genuine cases, so our objective always is to try and raise awareness of these issues and also to encourage workforces that are open about these matters and for issues to be discussed and addressed.

Senator RYAN: The report also says, on the bottom of page 74:

This year, 18% of APS employees reported having been subjected to harassment or bullying in the workplace in the previous 12 months.

Taking into account what you have just said about the subjective nature of it, 18 per cent is a fairly significant number and I am putting it out of just shy of 30,000 staff, if I take it across the whole of the APS. It is almost one in five.

Mr Sedgwick : Subject to the caveat that we have made, the number of confirmed cases where there has been a finding that someone has breached the code of conduct is in fact relatively low.

Senator RYAN: Are they all investigated, to an extent?

Senator Chris Evans: These are not complaints though, are they—they are survey results. We have survey results, we have complaints and we have got successful—

Senator RYAN: It is still a pretty extraordinary number—18 per cent.

Mr Sedgwick : Subject to the comments that we were making about perceptions—

Senator RYAN: I put to you, Mr Sedgwick, that even with the degree of subjectivity that can be an issue in these, if 18 per cent of people are reporting it, even if you discount it, you have an unhealthy workplace because one in five employees is indicating that they feel that way, and that can be a reflection of various things such as someone's performance being managed, as you outlined a few minutes ago.

Mr Sedgwick : I am not sure that I would characterise it as an unhealthy workplace. I would certainly say that that would tend to suggest there are issues that need to be addressed around either expectations or performance. Ms McGregor has just pointed out, on page 71 of that report, that the number of cases where a breach was found against an individual in 2010-11 for harassment and bullying was 46, which is somewhat at the other end of the scale.

Senator RYAN: I appreciate that.

Mr Sedgwick : So we are dealing with something that when it comes to proven cases is quite small but when it comes to people's perceptions or understanding is quite a deal larger. You are quite right: we have to work on that and make sure we have good understandings. Frankly, the thing that the Public Service is often regarded as doing least well is managing underperformance, so we just need to make sure that we have our workplace cultures in which the management of performance including the management of underperformance is done well, and we have got a way to go.

Senator RYAN: I also pointed out that the previous year's State of the service report said as many as 54 per cent of employees who say—not in a formal sense but maybe through surveys—that they are subject to bullying do not report it. The number of people not formally reporting but being surveyed on this has been relatively high for a while, so what strategies are in place to get it down and at what point are you going to say, 'There has been some success,' or, 'We are failing in our approach to get it down,' and try something else?

Mr Sedgwick : As I say, the numbers of confirmed cases of harassment and bullying are low, and they have been low and the numbers are not trending up, at least as I have just seen them. We will declare victory when we have no confirmed cases and low levels of reporting. We are clearly a long way short of that; I do not think, though, that that is particularly peculiar to the Public Service. I suspect we have a rather more sensitised and aware workforce than maybe numbers of others, and we will just keep working at this. As I say, bullying and harassment is not acceptable.

Ms Godwin : Just to give you a bit of context about how this flows through: of the 46 cases—I think it was 46 or 47—that the commissioner referred to had been investigated within an agency, those people then have a secondary right of review if they are unhappy with the outcome of that case. Those cases come to me and, of the cases for 2010-11 that came through to me, only three were issues to do with bullying and harassment.

Senator RYAN: It is just that the report also outlines the reasons why people do not report. Five per cent of all APS employees report that they believed no action would be taken, four per cent fear that it could affect their career and four per cent say that they do not want to upset relationships in the workplace. If you have this high a number of people indicating that they are subject to bullying or harassment—effectively one in five—and you have a low reporting number, you have an unhappy workplace because so many people are feeling that way but not actually reporting it. Given the subjectivity that is always present in these issues, surely you would want to get that 18 per cent level down fairly radically.

Mr Sedgwick : Can we begin from the position that we both agree that there are issues around workplace culture, understanding the quality of conversations in workplaces, the nature of the performance management framework but also, if you like, the degree of trust that exists within a workforce. Can we all agree that we would prefer that they were better than they are. In those circumstances we continue to work through the various networks that we have, and we were talking previously about absences, to promulgate good practice and to encourage the kinds of conversations in workplaces about performance and about bullying and harassment, which initially could lead to a tick-up in reporting—we often do see that—but ultimately leads to a better and shared understanding across the workplace.

My issue, though, is about an unhappy workplace. It is interesting. As Ms McGregor was saying a little earlier, we have adopted a new employee engagement model for this year's State of the service report. It does two things: it reports engagement with my team, engagement with my agency, engagement with my job and is reporting quite high levels of satisfaction. We even have international benchmarks—I refer you to page 41 which compares our results with those in the UK. With our engagement questions, 'I am proud to work in my current agency', we have a bit over—

Senator RYAN: I imagine times in the UK public service are a touch more challenging at the moment.

Mr Sedgwick : The interesting thing about this is that the UK public service did take a two-point hit to its engagement score two years ago but it has not since. It is true that our numbers are compared to that. Nonetheless, the gaps are quite significant. I would recommend my current agency as a good place to work—

Senator RYAN: We are very pressed for time. I will reread that section but I was focused on the 18 per cent of people who are indicating that they are subject and not necessarily making a report.

Mr Sedgwick : We agree with you—we wish it was lower.

Senator RYAN: We have the 70 per cent satisfaction level. In 2010, employees with disabilities had a much lower level of 57 per cent, I understand. Also, the State of the Service report 2010-11 outlined that employees with a disability were indicating a much higher level of harassment or bullying—in the order of 33 per cent compared to 17 per cent. Do you have an explanation for that?

Mr Sedgwick : No, I do not.

Senator RYAN: How big a priority is that? I would suggest that is a one in three, getting up to pretty high numbers.

Mr Sedgwick : We have quite a high priority on the more general diversity agenda. There are two elements of the diversity agenda where we are particularly keen on lifting our effort at the moment. One is the employment of people with a disability. The other one is the employment of Indigenous Australians. There is a chart in that report which shows a quite unhelpful tick down in the representation rate of both groups.

Senator RYAN: May be the 33 per cent is the reason.

Mr Sedgwick : It is true that the rate of separation of both people with a disability and Indigenous Australians is higher—my memory says twice as high as that for non-Indigenous Australians. In consultation with colleagues, we have work in hand to try to get a better handle on exactly those things.

Senator RYAN: Do you have a specific plan in place to reduce the number of one in three employees with a disability feeling that they have experienced bullying or harassment, as indicated by survey data? At that level we might argue about 18 but you have a major problem, whether based on subjectivity or not, with a part of your workforce.

Mr Sedgwick : We do not have a specific plan in place which deals with that part of the issue. In conjunction with our colleagues, we are working up specific actions to deal with the separation rate to understand the factors behind the separation rate of both Indigenous employees and those with a disability. The secretary's board has agreed to establish a diversity council as a subcommittee of the board to give this a real push in the next 12 months.

Senator RYAN: Will be coming back to this in May, Mr Sedgwick, when we will have more time. These numbers are fairly high. They are fairly simple benchmarks and for all the processes and councils, actually achieving a reduction in those numbers might also be a simple way of measuring success.

Mr Sedgwick : If we were to reduce those numbers, that would certainly give me some comfort. I think the issue is broader and are quite happy to have a conversation.

Senator FAULKNER: I do appreciate your statements about bullying and harassment, Mr Sedgwick. I am sure the committee is pleased to hear that. I am not surprised to hear your views in that regard. Having broken our duck about your role as Parliamentary Services Commissioner, let me ask me whether you are satisfied that in that role as Parliamentary Services Commissioner you are able to adequately oversight the issue of allegations of bullying and harassment in the Department of Parliamentary Services, something that has been drawn to the attention of this committee.

Mr Sedgwick : I think the answer to that question is in two parts and it reflects the nature of the responsibilities of whichever commissioner hat I am wearing at the time. It is for the agency and the agency head to deal with issues within the organisation. In circumstances where the allegation is in respect of the agency head him or herself, we particularly are dealt into that game. Otherwise we have a general watching brief in respect of parliamentary departments, as we do with others.

Senator FAULKNER: It is the watching brief I suppose I am referring to and the sort of statistical analysis that Senator Ryan was speaking about in relation to your other role. Your substantial role may well be relevant in relation to your role as Parliamentary Services Commissioner.

Mr Sedgwick : I have not seen that data in respect of the parliamentary departments. The data that Senator Ryan was referring to actually comes from our State of the Service report. I will be interested if there is such data.

Senator FAULKNER: Given that you have a watching brief, which I think is a good way of describing the role, and I know that Senator Johnston has some questions to ask IGIS, I am not going to delay the committee here, but this is something that I might explore with you at a later stage, Mr Sedgwick. It may well be time now for that watching brief to get a little bit more focus and attention, given some of the concerns that I have and I think other committee members have.

CHAIR: Thank you, Mr Sedgwick, and the officers for appearing before us. We will see you at the next estimates.