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Departmental machinery of government since 1987



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Information and Research Services

Research Paper

No. 24 1998-99

Departmental Machinery of Government Since 1987

John Nethercote

Politics and Public Administration Group

29 June 1999

Contents

Major Issues

Introduction

The 1987 changes

Cabinet and ministry

Departments

Department secretaries

Evolution of the Departmental Machinery of Government, 1987 to 1998

Central departments

Foreign Affairs, Trade and Defence

Industry departments

Human resources departments

Welfare departments

Arts, Sport, the Environment, Tourism and Territories

Immigration

Veterans' Affairs

Aboriginal Affairs

Functional nomads

Appraisal

Endnotes

Appendix 1: Departmental Machinery of Government, 1987-1998

Appendix 2: Chief executive personnel affected by the Machinery of Government changes, July 1987

Appendix 3: Departmental Machinery of Government: significant changes since July 1987

 

 

Major Issues

On 14 July 1987 the then Prime Minister Bob Hawke announced major changes to the ministerial and departmental structure of Commonwealth Government. A two-tiered ministry was established, composed mainly of Cabinet ministers heading departments, and other ministers each appointed to administer a particular department under a Cabinet minister. The number of departments was significantly reduced.

It is the purpose of this paper :

  • To explain the background and character of the 1987 machinery of government settlement as it affected the ministry and departments
  • To trace its subsequent history, and
  • To offer some analysis of its durability, noting that because of other changes in administrative policy and practice, the departmental machinery of government has been less stable than appears to be the case in a formal sense.

The principal findings of the research are :

  • The ministry was enlarged from 27 to 30, of whom 17 were members of the Cabinet. The number of departments was, by contrast, reduced from 28 to 18 by rationalisation and amalgamation. Of the 18, 16 were headed by Cabinet ministers. The exceptions were the departments of Veterans' Affairs and Aboriginal Affairs, the latter scheduled for abolition once a new statutory authority, the Aboriginal and Torres Strait Islander Commission, had been established
  • in establishing the two-tier ministry it was necessary to overcome long-standing opinion that the Constitution, section 64, only permitted appointment of one minister to each department, a view held strongly by Sir Garfield Barwick but not by a number of other eminent lawyers such as Sir Douglas Menzies, Sir Kenneth Bailey and the then Solicitor-General, Dr Gavan Griffith. In instituting the new structure, the Government acted on the advice of the latter. The new ministerial arrangements were upheld within two months by the Federal Court ( Mr Justice Beaumont) in a decision of 16 September 1987
  • as part of the changes, the Public Service Board was abolished. A number of its personnel powers, especially those relating to the Senior Executive Service, were vested in a new statutory officer, the Public Service Commissioner. Pay and conditions of employment functions were assumed by the Department of Industrial Relations. Other powers, often by delegation, were transferred to chief executives (such as secretaries) within the field of public service employment
  • as a consequence of the changes the following Cabinet departments continued, variously with augmented or reduced functions: Prime Minister and Cabinet; Treasury; Attorney-General's; Finance; Administrative Services; Defence; Industrial Relations (previously Employment and Industrial Relations); Social Security; Immigration, Local Government and Ethnic Affairs
  • the amalgamated departments were: Foreign Affairs and Trade; Primary Industries and Energy; Industry, Technology and Commerce; Transport and Communications; Employment, Education and Training; Community Services and Health; the Arts, Sport, the Environment, Tourism, and Territories
  • there were non-Cabinet departments, Veterans' Affairs and Aboriginal Affairs
  • although some of the new departments were seen as 'giants' or mega-departments of the type created in Britain from the late 1960s to the mid-1970s, they were not only on a much smaller scale to counterparts abroad but also smaller than the largest Australian departments, Defence and Social Security, neither of which was significantly affected by the 1987 restructure
  • the two-tier ministry has endured in all key respects. Since 1990, a new third tier, parliamentary secretaries, has evolved: there were four in the Fourth Hawke Government (1990-91); eight in the First Keating Government (1991-93); 10 in the Second Keating Government (1993-96) and the First Howard Government (1996-98); and 12 in the Second Howard Government (since 1998)
  • although all the major amalgamations except Foreign Affairs and Trade have been altered, the departmental structure instituted in 1987 remains essentially in situ 12 years later notwithstanding a number of changes of name
  • this is true both in terms of its organisational framework and most of the specific allocations
  • in particular, with the exception of the Department of Tourism (1991-96) and the partial exception of the Department of Housing and Regional Development (1994-96), there has not been a reversion to the former practice of creating small, narrowly-focussed departments
  • notwithstanding particular observations about specific aspects of the new structure, it was generally welcomed both in Parliament and by commentators in the media and elsewhere
  • a particular indicator of the workability of the new structure is the absence of any changes in the departmental machinery of government following the 1990 elections, the first time this had occurred in more than two decades. The first change of significance occurred in June 1991 following Paul Keating's resignation from the Hawke Government
  • unusually for machinery of government changes, but not surprisingly in this instance, there was, for nearly five years afterwards, continuing interest in the development of the new arrangement, and especially the fate of the larger amalgamations. Most of the commentary was by individuals with responsibility for making it work and the views were generally favourable. The absence of any running criticism, for example, in the press, suggests that the new arrangement did settle down with relatively few difficulties apart from those which often accompany major organisational change, and
  • notwithstanding the general durability of the new departmental machinery of government, there has continued to be considerable organisational change within portfolios, especially through hiving off, corporatisation and privatisation, for instance, by creation of Centrelink, based on the regional networks of the departments of Social Security and Employment, Education and Training, or establishment of bodies such as the Civil Aviation Safety Authority and the Australian Maritime Safety Authority within the Transport portfolio.

 

Introduction

Three days after the general elections of 11 July 1987 for both the Senate and the House of Representatives, the Prime Minister, Bob Hawke, as he later reported in his memoirs, announced 'sweeping changes to the structure of Commonwealth administration' 1 . The number of departments was reduced from 28 to 18 and the number of ministers increased from 27 to 30. All departments except Veterans' Affairs and Aboriginal Affairs were to be headed by Cabinet ministers. Several departments were to have one or two other ministers of non-Cabinet rank, responsible for specific functions. As part of these changes, the Public Service Board was abolished; a number of its personnel functions, including those relating to management of the Senior Executive Service, were vested in a new statutory officer, the Public Service Commissioner; its industrial functions were transferred to the new Department of Industrial Relations; other powers were transferred to chief executives (for example, department secretaries).

Like most machinery of government changes, especially those which follow elections, there was very little consultation or discussion. At the media conference announcing the changes the Prime Minister said: 'This is a Hawke decision, in regard to which I ha ve had consultation ... with a number of people' 2 . His memoirs show that there was consultation with various faction leaders, securing support for an enlargement of the ministry in the context of reducing the number of departments. 3

This restructuring of the ministry and departments was the most significant change in the departmental machinery of government in the history of the Commonwealth. It was more wide-ranging than changes occasioned by war (and, later, return to peace), and certainly on a scale unprecedented in peacetime. Even the expansion which had marked the establishment of the Whitlam Government administratively on 19 December 1972, or the major reorganisation of departments effected by Prime Minister Malcolm Fraser in mid-1982, which affected about one-third of staff, were less complex even if on a similar scale in terms of numbers affected.

The actual changes made in July 1987 have worn well, as a broad comparison with the departmental arrangements in place since the 1998 elections shows (see Appendix 1, columns 1 and 5). More significantly, the organisational framework of the 1987 departmental settlement have in all critical respects endured. With only one or two exceptions, notably the creation by the Keating Government of the Department of Tourism in December 1991 (subsequently abolished in March 1996) and, to some extent, the creation of the Department of Housing and Regional Development in 1994 (abolished in 1996 also), there has not been a return to the former situation of numerous, small, relatively narrowly focussed departments.

It is the purpose of this paper:

  • to explain the background and character of the 1987 settlement as it affected the ministry and departments
  • to trace its subsequent history, and
  • to offer some analysis of its durability, noting that because of other changes in administrative policy and practice, the departmental machinery of government has been less stable than appears to be the case in a formal sense.

The 1987 changes

There were two inter-related elements to the 1987 changes. The first was to introduce a two-tier ministry. The second element was an extensive rationalisation of departments and consequential reduction in the number.

There were a range of reasons which led the Government to take these steps in July 1987 after it had resisted doing so in December 1984 following the previous elections and in the intervening period. There was pressure within the governing party (ALP) for a bigger ministry, partly justified by enlargement of the Parliament in 1984 and by the size of Labor's win in the 1987 elections. 4 There was, however, opposition on political and administrative grounds to any increase in the number of departments which, under the practice prevailing until July 1987, would have been necessary to accommodate a larger ministry. As Hawke has written: 'I would have baulked at simply expanding the ministry' 5 .

At the same time there were strong views that a rationalisation of departments was needed for reasons of better policy, efficiency and effectiveness, including improved Cabinet coordination. A two-tiered ministry was essential if there was to be any expansion of the ministry and any rationalisation of departments. As Prime Minister Hawke saw it: 'The appointment of three additional ministers and the cost was minuscule against the massive savings effected by the restructuring. 6

Constitutional considerations had been a major hurdle in introducing a two-tiered ministry. A long-standing opinion of Sir Garfield Barwick, Attorney-General, 1958-63 and Chief Justice of the High Court of Australia from 1964 to 1981, held that it would be unsafe to have more than one minister in a department. The weight of all other legal opinion (for example, Sir Douglas Menzies, Sir Kenneth Bailey and the then Solicitor-General, Dr Gavan Griffith) leaned the other way; that opinion prevailed in 1987. 7

It was soon confirmed judicially. On 16 September 1987, Mr Justice Beaumont of the Federal Court of Australia, citing opinions by Professors Geoffrey Sawer and Enid Campbell, stated of the Constitution, section 64, that:

The language is general enough and there is no logical reason to restrict administrative arrangements which might be desirable in the interests of good government. On the contrary, there is every reason to suppose that flexibility was desirable and therefore intended to be conferred. Nor, in my view, is the principle of responsible government any obstacle: both Ministers would remain answerable to Parliament. … [T]he provisions should be liberally construed so as to afford a proper opportunity to the Executive to introduce administrative arrangements which are appropriate in particular circumstances. 8

In as much as it was relevant, experience of two-tiered ministries in Britain and Canada was mixed but it was felt that such problems as might arise could be managed, even in Australia where (so me believed) egalitarian sentiment was stronger.

Cabinet and ministry

The essence of the two-tier ministry was that, as a general rule, all departments would be headed by a Cabinet minister and, thus, all departments would be represented at the Cabinet tab le (whilst, at the same time, keeping the size of the Cabinet at a reasonable number). Cabinet ministers would be supported by ministers who would be assigned to departments specified with a designation and nominated responsibilities determined by the prime minister.

Under the arrangement established in 1987 there were 17 Cabinet ministers. Of this number, only one did not head a department—the Special Minister of State, Senator Susan Ryan, who was located in the Department of the Prime Minister and Cabinet with responsibilities for the Office of the Status of Women, the Bicentennial and the Australia Card. After she resigned early in 1988, her place in the Cabinet was taken by the Minister for Trade Negotiations, assigned to the Department of Foreign Affairs and Trade but also with responsibilities in the Industry, Technology and Commerce and Primary Industries and Energy portfolios.

Several departments did not have a second minister: Finance; Industrial Relations; and Social Security. On the other hand, a number of ministers were assigned responsibilities in several portfolios, for example, in addition to the Minister for Trade Negotiations whose responsibilities are outlined immediately above, the Minister for Consumer Affairs, located in the Attorney-General's portfolio also assisted the Treasurer in relation to prices.

This 1987 structure of the Cabinet/ministry replaced one in which all ministers headed departments but only the top 12-16 were members of the Cabinet, although non-Cabinet ministers customarily attended Cabinet for discussion of any submission they lodged. This system was instituted by the Menzies Government in 1956. It had prevailed since then except during the Whitlam Government which reverted to the pre-1956 structure in which the Cabinet and the ministry were co-terminous.

The Hawke Government, prior to the change, consisted of 27 ministers administering 28 departments, of whom 16 were members of the Cabinet.

Since 1987 the main principles have been maintained. The Cabinet has been kept to a size of 16 or 17, with most departments represented (on a small number of occasions particular ministers headed two departments; and, during the first Keating Government, the Minister for Tourism was simultaneously Minister for Resources in the Primary Industries and Energy portfolio). Only for a brief period has a Minister for Veterans' Affairs been a member of the Cabinet (also during the first Keating Government, 1991-3).

On the other hand, during the first two years of the Howard Government, the Attorney-General was not a member of the Cabinet. And the Minister for Immigration and Multicultural Affairs did not join the Cabinet until after the 1998 elections.

The most important change since 1987 has been addition of a third tier, parliamentary secretaries. There had been some previous intermittent use of parliamentary secretaries under the Lyons, Menzies (1950s) and Fraser governments (two and three respectively). During the Fraser Government a statutory basis for parliamentary secretaries was provided ( Parliamentary Secretaries Act 1980 ). In 1971-2, there were also six assistant ministers in addition to the 27 ministers (the McMahon Government).

Following the 1990 elections, four parliamentary secretaries were appointed. Prime Minister Paul Keating's first government had eight, his second, ten. Prime Minister John Howard's first government likewise had ten; there have been 12 since the 1998 electi ons.

The other observable change in ministerial arrangements since the 1987 changes has been discontinuation of the practice of assigning inter-departmental responsibilities to non-Cabinet ministers. The main circumstance where ministers now have responsibilities beyond the boundaries of a single department is where a minister is designated to assist the prime minister in a particular field. At present five ministers have such assignments on matters such as the status of women, the public service, reconciliation and the Sydney 2000 games. The Ministers for Veterans' Affairs is also Minister Assisting the Minister for Defence: this is the only other 'minister assisting' arrangement.

Departments

There was, and had been for several decades, an almost if not exa ct correspondence between the number of ministers and the number of departments. During Hawke's 1984-7 Government there were 27 ministers and 28 departments. As mentioned earlier, this correspondence was largely based on a view, held strongly by Sir Garfield Barwick, that under the Constitution, specifically sections 60-64, it was not possible to assign more than one minister to a department, although there was no impediment to a minister being responsible for two or more departments.

As the scope of the Commonwealth government had expanded, especially following the Second World War, this view meant an increasing number of departments, many of which were organisationally small and narrowly focussed functionally. This departmental administrative structure came under increasing criticism for a variety of reasons. Many decisions which desirably should have been made within a portfolio were made inter-ministerially, sometimes even at Cabinet level. Because functional range was restricted, the scope for strategic direction and management of Commonwealth activity was similarly limited; likewise, the scope for expenditure and financial management based on funding new programs by elimination or modification of older, out-moded programs was limited; and there was a resource cost in terms of the corporate services each department maintained to support its operations.

Some of the professional sentiment about what was essentially the post-war departmental structure is conveyed by the following extracts from the 1976 report of the Royal Commission on Australian Government Administration:

It is widely agreed that departments should be organised around a coherent function and that, as departments increase in number, the problems of co-ordination become more difficult. These views led both the Bland Committee in Victoria and the Corbett Committee in South Australia to recommend a reduction in the number of departments. The desire to do this is stronger among those who consider that a large department (like the Department of Defence or the Department of Transport) is the best organisational form for giving effect to government policy. Accordingly, it has been pressed on us that we should recommend that, over a period of time, the number of departments be reduced to about fifteen. This, it has been urged, would make possible a relatively small Cabinet and more effective co-ordination of related government activities.

We are not tempted to specify an optimum number for departments or an optimum size. Administrative considerations are clearly important but ... they must sometimes be subordinated to political factors.

This is not to say that departments should be created, restructured or abolished lightly. Over recent years this has been done with insufficient planning; too many small and weak departments have persisted; and interdepartmental co-ordination has become more difficult ... .

It is sometimes argued that departments should as far as possible be brought to a relatively uniform or 'ideal' size. We see no particular benefit in such uniformity. Nevertheless, plans for reorganisation should take size into account. On the other hand, there is inflexibility which tends to beset big organisations more than small, and the tighter esprit de corps and greater capacity for concentrated effort characteristic of smaller units. On the other, the more diverse resources of large departments can be a source of strength, and can enable many conflicts to be resolved internally rather than by collective ministerial processes.

On the whole our inclination is towards reducing rather than increasing the number of departments. But if ministerial control is to remain effective, there would in some large departments be a case for more than one minister ... . 9

Another insight into the thinking of officials on the matter was provided by Sir William Cole, a former secretary to the departments of Finance (1976-8) and Defence (1984-7), and chairman of the Public Service Board (1978-83), who wrote in the wake of announcement of the 1987 changes that:

Over the years we have had too many Mickey Mouse departments in Canberra. With all the talk about mega-departments now, it should be remembered that on a world scale even our bigger departments are not really very large.

Some argue that the number of departments doesn't matter very much. But apart from added administrative overheads, more rather than fewer departments makes for more power bases and more pressures to spend. Priorities which might be better sorted out within a large department land on the Cabinet table for settlement. 10

The judgment that a general rationalisation of the departmental machinery of government was needed was essentially based on experience in Australia. It was not conclusive, however. Amalgamation of Defence in 1973 had worked, but not without difficulty. 11 On the other hand, the attempt to forge a unified transport administration between 1973 and 1982 had not endured. Comparable attempts in Britain and Canada to rationalise the departmental structure, extending over two decades, offered only limited lessons for Australia (one of which was the desirability of amalgamating at several levels of the hierarchy and not only at the most senior if expected benefits were to be secured). 12 Especially in Britain, partly because it is essentially a unitary government in which the central government has many State-type as well as national functions, amalgamated departments, known variously as giant, jumbo or mega departments, were very much larger than any Australian counterpart and had a management task on a scale rarely encountered in Australia. This aspect, in fact, led Dr Michael Keating, Secretary, Department of the Prime Minister and Cabinet (1991-96), to write of the major 1987 amalgamations:

The description of those bodies as 'super' or 'mega' departments is a dreadful misnomer, because while the average number of employees per department rose in 1987, none of the new entities compared with the size of our two largest departments, Defence and Social Security—neither of which was affected by the 1987 changes. On average, the newly created departments are generally smaller than our largest private sector companies, such as BHP, and they are certainly smaller than their equivalents overseas. 13

The 1987 changes had both general and spec ific purposes. The general purposes were set out at the time as:

  • enhanced ministerial control
  • better coordination and decision-making processes
  • broader perspectives and greater coherence in policy advice and program development
  • greater scope for delegation to portfolios
  • reduction in overlap and duplication—with consequent savings, and
  • greater flexibility in portfolio operations and potential stability in machinery of government.

The specific purposes of the changes were identified as follows:

  • allocation of export promotion of commodities and manufactures to the relevant domestic industry departments, and merging responsibility for bilateral and multilateral trade negotiations with the Foreign Affairs portfolio; [this objective was accomplished by establishment of the Department of Foreign Affairs and Trade (author's note)]
  • amalgamation of education and training and labour market function; [this objective was met by establishment of the Department of Employment, Education and Training (author's note)]
  • drawing law enforcement functions under the Attorney-General's umbrella
  • bringing health policy, community services and housing assistance under the one umbrella, and linking the Veterans' Affairs and Aboriginal Affairs functions into that portfolio; [achieved by establishment of the Department of Community Services and Health (author's note)]
  • bringing together the major service functions of Transport, Aviation and Communications; [accomplished by creation of the Department of Transport and Communications (author's note)]
  • joining the related elements of the former departments of Arts, Heritage and Environment and Sport, Recreation and Tourism, and placing a separate ACT Administration within that portfolio; [the department to which this purpose was directed was Arts, Sport, the Environment, Tourism and Territories (author's note)], and
  • placing most Government common services into one portfolio [Department of Administrative Services (author's note)]. 14

The departmental structure which emerged was thus:

Continuing departments (some with augmented, others with reduced, functions) were:

  • Prime Minister and Cabinet
  • Treasury
  • Finance
  • Attorney-General's
  • Administrative Services
  • Defence
  • Industrial Relations (previously named Employment and Industrial Relations)
  • Social Security
  • Immigration, Local Government and Ethnic Affairs.

Departments based on amalgamations of two or more previous departments were:

  • Foreign Affairs and Trade
  • Primary Industries and Energy
  • Industry, Technology and Commerce ( name not changed when it absorbed the Department of Science)
  • Transport and Communications
  • Employment, Education and Training
  • Community Services and Health
  • the Arts, Sport, the Environment, Tourism and Territories.

Non-Cabinet departments

  • Veterans' Affairs
  • Aboriginal Affairs

More information about the components of the changes is contained in Appendix 1, column s 1 and 2.

Department secretaries

Whilst the changes added to the number of ministers, they also brought a reduction in the number of department secretaries, ten having been displaced, in addition to the three commissioners of the abolished Public Service Board. With two exceptions all those appointed as secretaries in the new structure had been secretaries immediately beforehand; the exceptions were Dr Peter Wilenski, chair of the Public Service Board (1983-87), previously secretary to the departments of Labor and Immigration (1975) and Education and Youth Affairs (1983), who became secretary to the new Department of Transport and Communications; and Tony Ayers, previously secretary to the departments of Aboriginal Affairs (1979-81) and Social Security (1981-86), who was appointed secretary to the Department of Community Services and Health.

Former secretaries who did not receive fresh appointments retained their rank. Nine were assigned to particular departments with the designation of Associate Secretary; this number included two who had been commissioners of the Public Service Board. Others took various posts with statutory bodies, some full-time, others part-time. One was appointed Australian ambassador to the Organisation for Economic Co-operation and Development (OECD). Of those not immediately appointed to head a department in July 1987, only three eventually returned to secretary posts; one former commissioner of the Public Service Board was also subsequently appointed as a departmental secretary. It was only in 1996 that personnel changes from the 1987 restructuring finally worked themselves out, either by appointment to established posts or retirement. By June 1999 only four of the top level personnel involved in the restructuring were still on the government payroll, two heading departments, two in statutory posts. For details, see Appendix 2.

It took some time for the secretary arrangements to settle down. In mid-1988 three heads left their posts, one going to the United Nations as Australian ambassador, another returning to a university professorship and a third retiring. Two of these vacancies were filled by transfer, the third by elevation of a serving officer; of the two vacancies thus created, one was filled by appointment of an associate secretary, the other by a promotion.

Six vacancies arose during 1989. Two of these were filled by transfer, a third by an associate secretary; another was filled by appointment of a full-time statutory chief executive officer; the remaining two were filled by promotions. By contrast there wer e only three changes (two in the same department) during 1990, an election year; all were filled by elevation of serving officials.

Evolution of the Departmental Machinery of Government, 1987 to 1998

It was neither intended nor expected that the particular configuration of departments and allocation of functions set in place in July 1987 would be permanent. So it has been in the past 12 years that there have been further changes arising from a variety of causes (different policy priorities, prospective improvements arising from a redistribution of workloads, for example). A number of changes bear the hallmark of a considered move fine-tuning particular arrangements (for example, some of those affecting the Department of Industrial Relations/Workplace Relations and Small Business). A number have arisen following elections, though the 1990 elections are notable for the absence of any organisational change afterwards for the first time in more than 20 years. But, as is to be expected, a new Government taking office in 1996 made some significant changes at the time and more as it familiarised itself with the workings of administration. Ministerial resignations and subsequent reshuffles in 1991, 1994 and 1997 have also been occasions for change. The significant changes since July 1987 are contained in Appendix 3.

Notwithstanding the increasing frequency of change (partly the result of a new government taking office), what is of interest is that not only has the basic framework of the 1987 structure worn well, so too have the actual arrangements themselves (especially given the instability which had marked the previous decade and a half and the ease with which such changes can be made in Australia). This feature is evident from Appendix 1 (columns 1 and 5) but may also be readily seen in an examination, sector by sector, of the departmental system since July 1987.

Central departments

The departments of the Prime Minister and Cabinet, the Treasury and Attorney-General's have survived the period, though not without major change in the case of the latter two. There have been some small changes at the Department of the Prime Minister; for example, the Office of Multicultural Affairs, was located within its establishment until it was transferred, reduced in function and staff, to the Department of Immigration and Multicultural Affairs by the Howard Government. A post of Chief Scientist was also located in Prime Minister and Cabinet for several years; these science activities have now been relocated to the Department of Industry, Technology and Resources. An Office of Indigenous Affairs was established in 1993 and reports to the Minister for Aboriginal Affairs who is now within the Prime Minister's portfolio.

The Treasury, both departmentally and as a portfolio, has acquired a range of economic bodies from elsewhere in the administration, including, in 1996, several from Attorney-General's, reflecting an increasingly market-based rather than law-based approach to business regulation. The then Industry Assistance Commission (IAC) was transferred from Industry as part of the 1987 reconstruction. It is now the Productivity Commission and has absorbed the IAC, the Economic Planning Advisory Council (EPAC) secretariat and parts of the Bureau of Industry Economics. Similarly, the Australian Competition and Consumer Commission (ACCC)) has been transferred to the Treasury portfolio. The portfolio also includes the Australian Competition Tribunal, the newly-established Australian Prudential Regulation Authority, the Australian Securities and Investments Commission, and the National Competition Council. Various divisions of the Attorney-General's Department concerned with business law, together with various business regulatory agencies, were transferred to the Treasury in March 1996.

The growth of the Treasury Department and portfolio illustrate some important characteristics of the post-1987 structure of Commonwealth administration. That structure is marked by a comprehensive definition of function where previously function had been conceived on a specialist, not to say limited basis. In so shaping the administrative structure, another feature of its predecessor has been increasingly diminished, namely administrative pluralism, an approach justified as providing ministers (in particular) with alternative (sometimes competing) sources of advice. As the Treasury portfolio has been enhanced, the Treasurer personally has had multiple sources of advice—for instance, the Department, the Reserve Bank and the Productivity Commission. But there is less scope for inter-agency discussion across portfolios as when EPAC was located within the Prime Minister's portfolio, the Industry Commission under the Industry minister and the forerunners of the ACCC within the Attorney-General's jurisdiction. This approach was often cited as a justification for the administrative structure developed by the Whitlam Government and underlined by Prime Minister Whitlam himself in his observation that:

We have not altered the traditional role of the Public Service in the policy making process, but by greatly increasing our sources of policy advice ... we have provided for a meeting of minds, a re-stimulation which is coupled with a leadership from the political level. Where this has resulted in tension it has in the main been creative tension, and that is our object. 15

A reported comment from the late 1980s underlines the diminution of administrative pluralism:

… Suddenly we no longer had those arguments because there was nobody left to argue with … they were all in this portfolio. So that was a great step forward. 16

In October 1998 the Australian Customs Service was transferred from the Industry portfolio to the Attorney-General's, thus bringing all Commonw ealth agencies involved in law enforcement together in one portfolio; excise collection was transferred to the Treasury.

The departments of Finance and Administrative Services were relatively stable until October 1997; the main change was a period of a year when the Arts formed a part of what was called, at the time, the Department of the Arts and Administrative Services (DAS (1993-4)). In October 1997, in the wake of ministerial resignations over abuse of travel allowances, DAS was abolished and many of its common service functions were located in the newly-renamed Department of Finance and Administration, an augmentation of Finance. The change had been implicitly foreshadowed as long ago as 1994 when, following the election of that year, the Minister for Administrative Services was omitted from the Cabinet and DAS was brought, for Cabinet purposes, under the jurisdiction of the Minister for Finance. This arrangement was maintained by the Howard Government when it came to office in 1996.

Foreign Affairs, Trade and Defence

The Department of Foreign Affairs and Trade has proven to be a great survivor of the 1987 settlement. The two antecedent departments had historically been rivals, particularly when John (later Sir John) McEwen was the Trade Minister (1956-71 ) and Sir Alan Westerman the department Secretary (1960-71). After an uneasy start the new department appeared to rise above its history, so much so that Austrade, first located in the Industry portfolio, was transferred to Department of Foreign Affairs and Trade in 1994.

A contributing factor in the durability of Department of Foreign Affairs and Trade may have been the inclusion, most of the time, of both the Foreign Affairs and the Trade ministers (the latter under various designations) in the Cabinet, the exceptions being the first six months of the new arrangement and during the first Keating Government (1991-93).

The Defence Department was an early case of large scale amalgamation when it absorbed the functions of the departments of Navy, Army and Air, and parts of Supply, in 1973. The Supply component of that amalgamation periodically re-emerged in various guises—Productivity from 1976 until abolition following the 1980 elections; and, in a somewhat different mix, as the Department of Defence Support from mid-1982 until abolition after the 1984 elections. Since then there has been widespread continuity in the basic framework of the Defence organisation.

Industry departments

The Department of Primary Industries and Energy was perhaps the most stable of t he industry departments in the post-1987 era, neither acquiring nor losing major functions; this was a feature of one of its two predecessors, the Department of Primary Industry (1956-87; renamed Agriculture, 1974-5). Its other predecessor had a less settled past, its major functions being embodied variously in National Development (1949-72); Minerals and Energy (1972-75); National Resources (1975-77); National Development/National Development and Energy/Trade and Resources (1977-83); and Resources and Energy (1983-7).

And so it was that in October 1998, when the Department of Agriculture, Fisheries and Forestry was formed as essentially a commodity-focussed organisation, that it was the resources function which was transferred to the renamed Department of Industry, Scie nce and Resources. [The secretary of the Department of Industry, Science and Resources, Russell Higgins, was executive director of the Resources and Energy Group in the Department of Primary Industries and Energy prior to taking up his appointment as secretary in 1997].

The Industry department has been most active in terms of name variations, many of which have arisen from modest changes in functions. This is not, however, a new feature of the post-1987 era. In the previous 15 years the Industry portfolio had a variety of names—Secondary Industry (1972-74), which was an up-grade of the Office of Secondary Industry located in the Department of Trade and Industry (1964-72); Manufacturing Industry (1974-75), an amalgamation of the Department of Secondary Industry and the residual parts of Supply not incorporated in the amalgamated Department of Defence; Industry and Commerce (1975-84), whose functions varied during its life, for example, transfer of some to the Department of Productivity in 1976; and Industry, Technology and Commerce, as the Department was named in 1984 when it assumed the technology functions of Science and Technology. Changes since then have been:

  • July 1987. The Department of Industry, Technology and Commerce assumed the functions of the Department of Science and the housing functions of the Department of Housing and Construction (the construction functions were transferred to the Department of Administrative Services)
  • June 1991. Housing functions of the Department of Industry, Technology and Regional Development transferred to the renamed Department of Health, Housing and Community Services
  • March 1994. Upon transfer of regional development function to the new Department of Housing and Regional Development, renamed Department of Industry, Science and Technology
  • March 1996. Renamed Department of Industry, Science and Tourism after absorbing the abolished Department of Tourism; the housing component of the also abolished Department of Housing and Regional Development; the science activities previously located in the Department of the Prime Minister and Cabinet; and consumer affairs functions transferred from the Attorney-General's Department, and
  • October 1998. Renamed Department of Industry, Science and Resources following transfer of resource functions from the Department of Primary Industries and Energy (now the Department of Agriculture, Fisheries and Forestries).

The Department of Transport and Communications was among the most substantial of the 1987 creations in both departmental and government terms. Not only did it combine three former departments, the portfolio itself included major government business enterprises such as QANTAS, the Australian National Line, Telecom (now Telstra) and Australia Post, as well as various regulatory bodies. It was as close as the new creations came to a 'jumbo' department and was the object of considerable interest because an earlier attempt to build a single Department of Transport (1973-82), bringing together previous departments of Civil Aviation and Shipping and Transport, was not regarded as having been very effective.

The 1987 Department of Transport and Communications nevertheless survived until 1993 with reasonably good reputation administratively until the pay-TV and associated controversies of 1993. 17

On this occasion, however, amalgamation of the Transport function has basically survived: responsibility for maritime services was for a period assigned to the Department of Workplace Relations and Small Business, however, in functional terms (which may not have been decisive) because of the significance of the industrial relations aspects.

Since 1996 transport has been linked to regional development, known since 1998 as regional services. The department's present name is Transport and Regional Services.

The Department of Communications was recreated with relative ease late in 1993, shortly a dding Arts, transferred from the DAS whose name then reverted to Department of Administrative Services. In October 1998, the department was renamed the Department of Communications, Information Technology and the Arts.

Human resources departments

The 1987 arrangements again saw a split in the industrial relations and employment functions as had occurred between 1977 and 1982. On this occasion the employment function was combined with education and training as the Department of Employment, Education and Training, becoming the Department of Employment, Education, Training and Youth Affairs in March 1996. (Youth affairs had previously been organisationally linked to education during the first Hawke Government, 1983-4, after which the Office of Youth Affairs was relocated to the Department of the Prime Minister and Cabinet.)

The Department of Industrial Relations created in 1987 differed from its immediate predecessor name-sake (1978-82) because it also inherited the pay and conditions functions of the Public Service Board which had been abolished in the reconstruction.

During 1997 it acquired some new activities from both Transport (maritime matters) and Industry (small business) and was renamed the Department of Workplace Relations and Small Business. With the advent of enterprise bargaining and a reduced central role within the public sector, the nature of its industrial relations responsibilities had changed dramatically, as illustrated by the new industrial legislation; the name change, from Industrial Relations to Workplace Relations, reflected this. (In the case of responsibility for maritime matters, it may be noted that, in an earlier period, stevedoring had been handled by the Department of Labour and National Service, a predecessor of the Department of Workplace Relations and Small Business, rather than the then Department of Shipping and Transport).

Following the 1998 elections the employment function was transferred to the Department of Workplace Relations and Small Business, renamed Employment, Workplace Relations and Small Business, thereby bringing the two functions of employment and industrial relations together once again. The employment function, especially with creation of Centrelink and Employment National, is now of a very different hue to that separated out in 1987.

Welfare departments

In July 1987 the Department of Social Security was left largely untouched and remained an organisation in which administering a large range of payments was more conspicuous publicly than its policy activities. Many of the former activities have been transferred to Centrelink.

After the 1998 elections residual social security functions were combined with others from the former Department of Health and Family Services, the Attorney-General's Department and the Child Support Agency, previously located in the Australian Taxation Office, to constitute a Department of Family and Community Services.

The other welfare department emerging from the 1987 restructure was the Department of Community Services and Health, a combination of the Department of Community Services (formed following the 1984 elections from non-income support programs excised from the Department of Social Security) and the long-standing Department of Health (established in 1921) which, since 1975, had covered health insurance policy as well as matters of a professional medical nature).

In July 1991, in a ministerial restructure following Paul Keating's resignation from the Hawke Government and Brian Howe's elevation to the deputy prime ministership, responsibility for housing was transferred and the department took the name of Health, Housing and Community Services.

Following the 1993 elections the department was renamed Health, Housing, Local Government and Community Services, local government having been transferred from the Department of Immigration, Local Government and Ethnic Affairs which then reverted to its former name of Immigration and Ethnic Affairs (1975-87). During this period the Department had two ministers of Cabinet rank, Brian Howe, the Deputy Prime Minister, and Senator Graham Richardson.

In March 1994 this department was divided. One part, with the addition of regional development from Industry, Technology and Regional Development, became the Department of Housing and Regional Development; the other part was constituted as the Department o f Human Services and Health which, in turn, became the Department of Health and Family Services after the change of government in March 1996.

After the 1998 elections, some functions having been transferred to the Department of Family and Community Services, Health and Family Services became Health and Aged Care.

The Department of Housing and Regional Development did not survive the 1996 change of government. Its housing and some local government functions went to the Department of Industry, Science and Tourism, whilst regional development was, as the name suggests, relocated in the now-named Department of Transport and Regional Development.

Arts, Sport, the Environment, Tourism and Territories

The Department of the Arts, Sport, the Environment Tourism and T erritories (DASETT), was an omnibus organisation in the 1987 plan, incorporating a disparate range of functions, a number having some relationship to one another, others being relatively self-contained. The disparate character of these functions is illustrated by their eventual dispersal to other departments as what started as DAS progressively became more focussed on the environment.

The territories function was, in the main, transferred to the newly self-governing ACT although it continued in the name until 1997 because it also included responsibility for matters relating to Australia's external territories. This function has now been transferred to Transport and Regional Development. Tourism was hived off as a separate department in 1991. The arts went first to the DAS in 1993 and the next year to the Department of Communications and the Arts. Sport was transferred to the Department of Industry in 1997.

Following the 1998 elections the department took the name of Environment and Heritage.

Immigration

There had been a Department of Immigration since 1945; it was amalgamated with the Department of Labor following the 1974 elections; the merged department was named the Department of Labor and Immigration. The Department of Immigration and Ethnic Affairs which was created in 1975 emerged from the 1987 changes with the addition of local government (from the Department of Local Government and Administrative Services, which again became the Department of Administrative Services). Local government was assigned to the Department of Health, Housing, Local Government and Community Services following the 1993 elections and the Department reverted to its former name.

After the 1996 change of government, the Department was renamed Immigration and Multicultural Affairs, incorporating the Office of Multicultural Affairs which had formerly been located in the Department of the Prime Minister and Cabinet.

Veterans' Affairs

The Department of Veterans' Affairs was retained as a non-Cabinet department in the 1987 change, and has b een variously attached to the Department of Social Security and the Department of Defence.

Aboriginal Affairs

The Department of Aboriginal Affairs was abolished in 1990 following establishment of the Aboriginal and Torres Strait Islander Commission (which also absorbed the former Aboriginal Development Corporation).

The Minister for Aboriginal Affairs was for a time within the Employment, Education and Training portfolio and has subsequently been located in the Department of the Prime Minister and Cabinet which, since 1994, has had an Office of Indigenous Affairs.

Functional nomads

Notwithstanding the durability of the basic structure since 1987 there have still been a number of functions which have not had a settled location. Several components of the 1987 Department of the Arts, Sport, the Environment, Tourism and Territories are in this category:

  • The Arts : moved to DAS in 1993, and thence, in 1994, to the Department of Communications and the Arts (now the Department of Communications, Information Technology and the Arts), where it is currently located
  • Sport : Transferred to the Department of Industry, Science and Tourism (now Industry, Science and Resources) on 9 October 1997
  • Tourism : Separated in 1991 when the Keating Government came to office and constituted it as a department. The department was abolished following the change of government in 1996 and tourism was assigned to the Department of Industry, Science and Tourism (Industry, Science and Resources since October 1998), and
  • Territories : Transferred to the Department of Transport and Regional Development on 9 October 1997.

What had been DAS, an omnibus organisation handling functions not readily located elsewhere, became simply the Department of the Environment on 9 October 1997 and the Department of the Environment and Heritage following the 1998 e lections.

The Industry department has also been the location for a number of functions with no obvious departmental base:

  • as already noted, former DASETT functions of sport and tourism were eventually located in Industry, the first directly transferred, the second after forming a separate department during the Keating Government
  • Housing: Part of Industry, Technology and Commerce from 1987 until 7 June 1991; transferred to Department of Health, Housing and Community Services in 1991; in 1994, transferred to Housing and Regional Development; returned to the Department of Industry, Science and Tourism in 1996 when the Howard Government took office
  • Regional development: Following the 1993 elections, in a department called Industry, Technology and Regional Development; in 1994, transferred to Housing and Regional Development; after election of the Howard Government, relocated in Transport and Regional Development; remained in the present Department of Transport and Regional Services following the October 1998 elections, and
  • Local government : Transferred from the Department of Local Government and Administrative Services to the Department of Immigration, Local Government and Ethnic Affairs in July 1987; thence to the Department of Health, Housing, Local Government and Community Services following the 1993 elections; in 1994, assigned to the Department of Housing and Regional Development; now located in the Department of Transport and Regional Services.

A feature of the functional nomads is that they include a number of functions—the arts, tourism, housing, regional development (services), local government—which, irrespective of departmental location, governments often like to have visibly represented in the departmental nomenclature. At present, however, only the arts and regional services form part of a department's name.

Appraisal

It is relatively rare for major organisational changes in government to be formally and openly evaluated. This may be partly explained by their intensely political character, but also, and more significantly, by the formidable methodological difficulties in doing so on anything much more than an impressionistic basis, which is in many respects unsatisfactory. The 1992 Task Force on Management Improvement recognised as much when it reported that 'a judgment of success or failure must rely heavily on qualitative data, including perceptions' 18 .

Similarly, organisational changes are often seen as having short-term costs but bringing longer-term benefits, though, again, there is very little firm data to support this proposition. On this point Michael Codd has observed: 'There were substantial adjustment costs associated with these changes'. He added, without amplification, that: 'the changes have generated their own ongoing management challenges'. 19

Conversely, former Prime Minister Hawke, in his account, was anxious to explain that the restructuring was not a cost-cutting exercise notwithstanding the financial spin-off:

Although not the driving consideration behind the restructure, savings were nonetheless an important factor and were calculated at $ 96 million in the coming financial year. 20

Former Finance Minister Peter Walsh thought otherwise:

The Departmental amalgamations were supposed to achieve, over time, administrative savings of the order of $100 million a year. How much, if any, was realised will never be known because it disappeared into a fog of additions to running costs, allegedly aligned to new policy. 21

The case of the 1987 changes is further complicated because they were integrally connected to—in some respects, derivative of—policy reforms. Thus, two scholars who reviewed the e volution of the new structure in the early 1990s observed:

It is ... difficult to separate structural initiatives for coordination from specific government reform programs. This confounds any assessment of the effect of amalgamation on policy development and co-ordination by raising two problems: it is hard to determine what effect the amalgamation would have in an environment not dominated by the reform agenda; and it is difficult to determine whether the reformist policy agenda would have been possible without amalgamation. 22

Notwithstanding these considerations there was, at the time, and in the ensuing five years especially, continuing interest in the workings of the new structure. In the print media, the day following the announcement, Maximilian Walsh w rote that the Prime Minister had 'produced a bold initiative of profound importance'. Michelle Grattan thought it 'administratively daring and politically cunning'. 23 Sir William Cole, who was well-placed to understand what was involved, was forthright:

Successive Australian governments have had the bad habit of constantly reorganising the structure of departments. Usually the dislocation costs have outweighed any benefit. This time, however, the Government may actually achieve something worthwhile. 24

There w ere reservations about particular points. The Canberra Times ' editorialist believed that the Department of Transport and Communications would 'in fact prove difficult to manage on any common theme', and thought, concerning the Department of Foreign Affairs and Trade, that 'there are good reasons for keeping some trade-policy issues distinct from pure foreign affairs ones (say, over trade with South Africa)'.The editorialist also thought that:

... [t]acking employment and training to Education (i.e., making the education system more responsive to labour-market needs) is one of the cyclical wisdoms—in due course it will seem better to focus on purer educational issues and not on making it a handmaiden of industry. 25

Other comment centred on how well the two-tie red ministry would work. Sir William Cole was not alone in thinking that the 'main risk' was whether 'the changes announced by the Prime Minister ... of more effective ministerial arrangements will work as intended. Whether the policies to be administered will be better is another matter' 26 . Former minister and Opposition front-bencher Ian Macphee was also reported as saying that the Government 'faced potentially serious problems in defining areas of responsibility between ministers in the two-tiered departmental structure'; he thought 'junior ministers risked becoming ''supernumeries'' to the secretaries of the 16 mega-departments'. The report of his speech concluded:

…There is nothing wrong with the super-ministries, but the ... plan does nothing to prevent junior ministers becoming subservient to the new breed of super-departmental head, he [Macphee] said. 27

Peter Walsh, who was not assigned a second minister in the Finance portfolio, later criticised the idea of junior ministers as such: 'a junior minister doesn't help much, especially if he/she is a dill'. 28

A later newspaper report concentrated on what it described as 'the chaos, discord and loss of morale' created by the 'dramatic reorganisation of the bureaucracy just after the election ... . It is widely predicted that very little of substance will appear for 12 months at best and two years at worst' 29 .

The changes were of sufficient importance to warrant a ministerial statement to the House of Representatives by the Prime Minister when Parliament again met. 30 In his response the then Leader of the Opposition, John Howard, said of the two-tier ministry that there was 'merit in the concept of having a number of Ministers sworn to administer the same department. The old idea that one had to create a shell department in order to have another Minister performing in the same general area as an existing Minister was an anachronistic one.' [Howard, here, was drawing on his experience in 1977 as Minister for Special Trade Negotiations. The department in question was located within the Department of Overseas Trade, the secretary of which was also secretary of the Department of Special Trade Negotiations. The Department of the Vice-President of the Executive Council, 1982-3, established by the Fraser Government, was another, even more nominal instance of the shell department device, which was only used on these occasions.]

Of the departmental arrangements Howard said:

A number of the amalgamations and consolidations of departments that have been announced by the Government are also welcomed by the Opposition. They mirror, in a number of quite crucial areas, declared policy positions taken by the Opposition. I therefore welcome the opportunity of saying to the House that the Opposition will be able to support large elements of the reforms announced by the Prime Minister. 31

In the very earliest months of the new arrangements there were some incidents, such as the controversy about the aerial coast-watch contract with Amann Aviation, which raised questions about their viability. In the absence of repetition, interest was short-lived.

A clear illustration that the new arrangements were settling down was the very modest changes to the departmental machinery of government after the 1990 elections. The Department of the Prime Minister and Cabinet recorded in its 1989-90 annual report that:

In the past, after an election, it has been common for substantial changes to administrative arrangements to be made. Major changes made after the 1987 election have resulted in arrangements which made further changes immediately after the March 1990 election unnecessary. 32

Dr Michael Keating, also commenting on arrangements following the 1990 elections, has written that:

... [t]he ministry change involved no fewer than 32 individuals, including retiring ministers, but only four changes were made to administrative arrangements, only two of which were directly related to ministerial reorganisation. 33

The most striking feature of the 1987 structure has, indeed, been its remarkably durable character both generically and even in specific terms. One study, drawing upon a 1992 address by Dr Michael Keating, Secretary, Department of the Prime Minister and Cabinet, has stated that:

One of the most obvious achievements of the 1987 changes is the major reduction in subsequent alterations to the composition of departments. The average annual number of changes per year to the administrative arrangements for the five governments prior to 1987 was 18 changes, whereas subsequently this figure has been fewer than four. 34

Most significantly, apart from a couple of aberrations already mentioned (Tourism and Housing and Regional Development), there has not been any return to what Sir William Cole wrote of as 'Mickey Mouse' departments. Several of the particular unions have no t endured, such as transport and communications, employment and education, and primary industries and energy. It was, however, never intended that the specific arrangements made in July 1987 should be eternal. Several reasons can be suggested for the need for subsequent change such as the scope was or became too large and the functions too disparate; functions, in different circumstances, were simply more appropriately located elsewhere. The character of the 1987 framework was such that none of the departments appeared to have been designed simply to respond to the special interests of any individual minister in the manner that the Trade Department, later the Department of Trade and Industry (1956-72), reflected Sir John McEwen's interests. The nearest any departments came to fitting this category were the Department of Health, Housing, [Local Government] and Community Services, and , later, the Department of Housing and Regional Development, the functions of both of which were strongly influenced by the concerns of Brian Howe, Deputy Prime Minister from mid-1991 (following Paul Keating's resignation from the Hawke Government) until mid-1995.

The durability might also be a product of fatigue so far as departmental restructuring was concerned. After 15 years of frequent change, restructuring ceased to have the invigorating effects claimed for it and, moreover, was no longer seen as an effective means of addressing either policy or administrative problems. Speeches on questions of departmental organisation during the 1980s often included the following observation attributed to Petronius:

We trained hard; but it seemed that every time we were beginning to form into teams we would be reorganised. I was to learn later in life that we tend to meet any new situation by reorganising; and a wonderful method it can be for creating the illusion of progress while producing confusion, inefficiency and demoralisation. 35

Not all commentary has been benign. Former Finance Minister Peter Walsh thought it a mistake to expand the mi nistry and to establish 'super ministries'. 'The new arrangement was unwieldy and unbalanced'. Two departments, Employment, Education and Training, and Community Services and Health, were 'too big and diversified for any Minister to manage and have never been under control'. 36

There was also criticism from academic quarters, drawing to some extent upon the views of participants:

A problem recognised by observers at an early stage was the absence of a coherent development strategy for the administrative system as a whole. While the boldness of the machinery of government changes was clearly acknowledged, concerns were expressed that its full implications had not been adequately thought through.

As the degree of disruption and dislocation caused by the machinery of government changes became increasingly evident it appeared that the architects of the changes had substantially overestimated the capacity of departments to cope with them, coming as they did during a period characterised by a rapidly expanding reform agenda, ever-increasing demands for complex policy work and prolonged fiscal stringency. Furthermore, the management of the process of reform became the subject of growing criticism. In particular, it was argued that communication and consultation with staff had been inadequate, that the changes had occurred without sufficient preparation and that they lacked a common purpose. A growing number of commentators blamed the scope and pace of the machinery of government changes for what was perceived to be a growing level of cynicism concerning the benefits of organisational change and a reduction in the level of morale within the public service. It should be noted that these difficulties were undoubtedly exacerbated by a range of other factors. For example, Dr Simon Hearn cited 'a long period of across-the-board cuts, staff attrition, inadequate investment in training and office technology and a widening gap between public and private sector salaries' as contributing to low levels of staff morale within the Department of Primary Industries and Energy. This point of view was encapsulated in the following statement by John Baker, First Assistant Commissioner, [Public Service Commission]:

We seem not to have learned that organisational change is something that needs to be 'managed' and led at many levels within the organisation. It cannot simply be allowed to happen, thus risking large numbers of staff in the organisation becoming alienated and suffering from low morale. The consequence here is that the benefits and gains expected to flow from reorganisation are more than offset by the human toll, the costs resulting from its unintended consequences for, and impact upon, the organisation's people. 37

One of these commentators, writing in 1994, thought that 'the functioning of key restructured departments has been problematic in the 1990s':

To acknowledge that individual departmental problems might derive from departmental organisation would have brought the overall reorganisation into question. In order to maintain structural stability overall, problems at the level of the individual unit were minimised. The challenges of managing employment and education in one department persisted. … . In the case of the complex 'mega-department', Transport and Communications, it was not possible to contain the difficulties within the department; the two components were separated to form new organisations in 1993. 38

[This last comment is misleading in that it fails to acknowledge that the transport function has remained unified and that the Department was split into two parts, not three as had previously been the case before amalgamation in 1987. (author's note)]

In many respects the durability of the 1987 struct ure is deceptive. It has in fact been a period of great and continuing change in the concept of departments and their functions. This is partly indicated by the drop in the size of the Australian public service from 143 959 full-time permanent staff in June 1987 to 103 506 in June 1998, a reduction of 28 per cent. In several portfolios there have been major developments in the character of particular departments as a consequence of hiving off operational functions, and corporatisation. Perhaps the most significant case in terms of numbers of staff has been establishment of Centrelink, as a consequence of which the Department of Social Security dropped from 19 354 full-time permanent staff in 1995 to 728 in 1998. In another instance, a large stream of work has recently been removed from the Attorney-General's Department when the Australian Government Solicitor was converted into a statutory authority. One important reason for the durability of the unified transport administration as a result of the 1987 changes has been the hiving off of operational functions to the Civil Aviation Safety Authority (initially the Civil Aviation Authority) and the Australian Maritime Safety Authority. (The total full-time permanent staff of the departments of Transport and Aviation was 10 566 at 30 June 1987; the figure for the Department of Transport at 30 June 1995 was 757.) Commercialisation of many activities in the Defence portfolio has enabled a down-sizing of its organisation.

In some senses departments, a constitutional term, might now be more accurately described as ministries because their activities are more focussed on servicing the minister in policy and administrative matters, with operations in other hands. Similar approaches have been followed in Britain as a consequence of the so-called Next Steps initiative, and also in Canada to a lesser degree. These practices in Australia are something of a departure from the basically integrationist approach of much of the post-war period but they are far from out of place in a government culture which has strongly favoured the use of statutory authorities, not least because of a belief that they were better able to operate on a business basis.

As a general evaluation of the changes is difficult, so also it is difficult to comment on some of the goals set out on page nine of this paper. Any attempt to verify whether the goal of 'enhanced ministerial control' had been accomplished would at best be impressionistic. It is clear, however, that a consequence of the change has been a reduced Cabinet agenda. Michael Codd wrote in a 1989 paper that:

The volume of business being dealt with in Cabinet and its committees—both Budget business and other business—has been substantially reduced, with a counterpoint increase in the extent to which ministers take decisions themselves, either singly or in a collective fashion through more informal consultation with colleagues. Associated with this, there is less intervention from the central co-ordinating departments and agencies. 39

On some goals a clearer response might be secured—for example, the 'greater scope for delegation to portfolios' can, to a degree, be tested, and is certainly the case in terms of powers pr eviously exercised by the Public Service Board; similarly, whether there has been a 'reduction in overlap and duplication' is probably capable of a degree of confirmation.

Much of the detailed analysis of the 1987 changes has come from interested individuals with responsibilities to make them work. It has been generally if sceptically confirmed, however, by observations reported anonymously in some academically conducted interviews during the late 1980s and early 1990s. 40 Its basic validity, apart from occasional episodes, is also indicated by the absence of any sustained, serious criticisms of the type directed at the Civil Aviation Authority during its life. Commentary mainly focuses on instances of the new arrangements perceptibly working as planned or better than planned. The absence of comment about particular aspects of the system is an indicator that the intended goals were yet to be accomplished. The benefits to which various observers point are reduced workload for the Cabinet itself (as noted above), opportunities for better policy coordination and, on another front, job enrichment. An underlying theme of several papers presented at a Griffith University conference and noted by the rapporteur, was the advantages derived from several years without change:

The stability of machinery of government arrangements from 1987 to 1992 has allowed managers to develop many of their managerial changes; the discussions in the book are based primarily on that—perhaps rare—experience of calm. 41

[This observation again alludes to the fatigue theme.]

Appendix 3 in particular shows there has been greater change following the past two elections, partly stemming from a new ministry placing its own stamp on the machinery of government, partly stemming from the unravelling of an organisational structure representing policy priorities more than a decade old. Even so, the benefits of periods of formal stability to policy development and implementation, as well as management practices, are frequently more important than is often recognised.

This paper simply focuses on the departmental machinery of government. The consolidations of 1987 removed what was seen by many government professionals as a long-running defect in the core, departmental organisation of Commonwealth Government. In the past decade the focus of endeavours to improve efficiency by organisational means has shifted elsewhere, in part by hiving off, corporatisation and privatisation. These developments have inevitably affected the role of departments, making them more clearly focussed on supporting ministers, policy development and monitoring, appraisal and evaluation. It is in increasing separation of policy and implementation in government, in various guises such as the so-called purchaser-provider split, that new areas for attention by administrative architects and analysts are likely to arise.

Endnotes

 

Appendix 1: Departmental Machinery of Government, 1987-1998

(1)

(2)

(3)

(4)

(5)

Pre-July 1987

Post-July 1987 Reorganisation

Second Keating Government, March 1993

Post 1996 elections—Howard Government

Post 1998 elections—Howard Government

Prime Minister and

Cabinet

Prime Minister and Cabinet

Prime Minister and Cabinet

Prime Minister and Cabinet

Prime Minister and Cabinet

Treasury

Treasury

Treasury

Treasury

Treasury

Attorney-General's

Attorney-General's

Attorney-General's

Attorney-General's

Atto rney-General's

Special Minister of State

       

Finance

Finance

Finance

Finance

Finance and Administration

Local Government and

Administrative Services

Administrative Services

Arts and Administrative Services

Administrative Services

 

Housing and Construct ion

       

Foreign Affairs

Foreign Affairs and Trade

Foreign Affairs and Trade

Foreign Affairs and Trade

Foreign Affairs and Trade

Trade

       

Defence

Defence

Defence

Defence

Defence

Industry, Technology and

Commerce

Industry, Technology and

Commerce

Indust ry, Technology and Regional

Development

Industry, Science and Tourism

Industry, Science and Resources

Science

       

Primary Industry

Primary Industries and Energy

Primary Industries and Energy

Primary Industries and Energy

Agriculture, Forest and Fisheries

Resources and Energy

       

Transport

Transport and Communications

Transport and Communications

Transport and Regional Development

Transport and Regional Services

Aviation

       

Communications

   

Communications and the Arts

Communications, Information Tech nology and

the Arts

Employment and

Industrial Relations

Industrial Relations

Industrial Relations

Industrial Relations

Employment, Workplace Relations and Small

Business

Education

Employment, Education and

Training

Employment, Education and Youth Affairs

Employment, Education, Training and Youth

Affairs

Education, Training and Youth Affairs

Social Security

Social Security

Social Security

Social Security

Family and Community Services

Community Services

Community Services and Health

Health, Housing, Local Government and

Community Services

Health and Family Services

Health and Aged Care

Health

       

Arts, Heritage and

Environment

Arts, Sport, the Environment,

Tourism and Territories

Environment, Sport and Territories

Environment

Environment and Heritage

Sp ort, Recreation and

Tourism

 

Tourism (created 1991)

   

Territories

       

Immigration and Ethnic

Affairs

Immigration, Local Government

and Ethnic Affairs

Immigration and Ethnic Affairs

Immigration and Multicultural Affairs

Immigration and Multicultural Affai rs

Veterans' Affairs

Veterans' Affairs

Veterans' Affairs

Veterans' Affairs

Veterans' Affairs

Aboriginal Affairs

Aboriginal Affairs

     

 

Appendix 2: Chief executive personnel affected by the Machinery of Government changes, July 1987

 

Position prior to 1 987 changes

Position after 1987 changes

Subsequent posts

Michael Codd

Prime Minister and Cabinet

Secretary, Prime Minister

and Cabinet

Relinquished post on Paul

Keating's assumption of prime

ministership and retired the following year

Bernie Fraser

Treas ury

Secretary, Treasury

Governor, Reserve Bank, 1989-96

Patrick Brazil

Attorney-General's

Secretary, Attorney-

General's

Retired in 1989

Darcy McGaurr

Special Minister of State

Associate Secretary,

Primary Industries and

Energy

Resigned in 1989 to take

d epartment head position in

Tasmanian Government

Dr Michael Keating

Finance

Secretary, Finance

Secretary, Prime Minister and

Cabinet, 1991-6

Graham Glenn

Local Government and

Administrative Services

Secretary, Administrative

Services

Secretary, Industrial

Relations, 1989-92. Retired

after relinquishing office

Tony Blunn

Housing and Construction

Secretary, Arts, Sport, the

Environment, Tourism and

Territories, 1987-93

Secretary, Social Security, 1993-97; Secretary, Attorney-General's Department since 1997

Stuart Harris

Foreign Affairs

Secretary, Foreign Affairs

and Trade

In 1988, appointed Professor,

International Relations, ANU

Research School of Pacific

Studies

Vincent Fitzgerald

Trade

Secretary, Dept of

Employment, Education and

Training

Resigned in 1989 and joined

the Allen Consulting Group

Alan Woods

Defence

Secretary, Defence

Retired 1988

David Charles

Industry, Technology and Commerce

Secretary, Industry,

Technology and Commerce

Consulate-General, Berlin,

1990-93. Joined the Allen

Consulting Group

Greg Tegart

Science

Secretary, Australian

Science and Technology

Council, 1987-93

 

Geoff Miller

Primary Industry

Assoc Secretary, Foreign

Affairs and Trade, 198 7-8

Secretary, Primary Industries

and Energy, 1988-93;

Secretary, Tourism, 1992-3.

Retired in 1994 after

unsuccessfully seeking post of

Director-General, Food and

Agriculture Organisation

Graham Evans

Resources and Energy

Secretary, Primary

Industries and Energy,

1987-8

Secretary, Transport and

Communications, 1988-93;

Secretary, Transport, 1993-5.

Resigned and took up position with BHP

 

 

Position prior to 1987 changes

New position with 1987 changes

Subsequent career moves

Colin Freeland

Transport

Asso ciate Secretary,

Transport and

Communications, 1987-8

Chief Executive Officer, Civil

Aviation Authority, 1988-90.

Retired

Rae Taylor

Aviation

Secretary, Industrial

Relations, 1987-89

Managing Director, Australia

Post, 1989-93

Charles Halton

Communication s

Various assignments

mainly within

Employment, Education and

Training portfolio until retirement

Unknown

Edward Visbord

Employment and Industrial

Relations

Australian Ambassador,

OECD, 1988-91

Unknown

Helen Williams

Education

Associate Secretary,

Employ ment, Education and

Training, 1987-8

Associate Secretary

(Communications), Transport

and Communications, 1988-90;

Head, Commonwealth-State

Relations Secretariat, Prime

Minister and Cabinet, 1990-3;

Secretary, Tourism,1993-96;

Secretary, Immigration and

Multicultural Affairs, 1996-8;

Public Service Commissioner

since 1998

Derek Volker

Social Security

Secretary, Social Security

Secretary, Employment,

Education, Training and Youth

Affairs, 1993-6.

Alan Rose

Community Services

Associate Secretary,

Attorney-Ge neral's,

1987-9

Secretary, Attorney-General's,

1989-94; President,

Australian Law Reform

Commission, 1994-9

Bernie McKay

Health

Associate Secretary,

Health and Community

Services, 1987-8

Unknown

Pat Galvin

Arts, Heritage and the

Environment

Associate Sec retary, the

Arts, Sport, the

Environment, Tourism and

Territories, 1987-8

Unknown

Bruce MacDonald

Sport, Tourism and

Recreation

President-designate,

Proposed Data Protection

Agency, 1987-8

Special Consultant, the Arts,

Sport, the Environment,

Tourism and Territories,

1988-9; Administrator,

Norfolk Island, 1989-92

John Enfield

Territories

Public Service

Commissioner, 1987-91

Unknown

Ron Brown

Immigration and Ethnic

Affairs

Secretary, Immigration,

Local Government and

Ethnic Affairs until 1990.

Unknown

No el Tanzer

Veterans' Affairs

Secretary, Veterans'

Affairs until 1989

Secretary, Administrative

Services, etc., 1989-94

Charles Perkins

Aboriginal Affairs

Secretary, Aboriginal

Affairs until 1989

Unknown

 

 

 

Position prior to 1987 changes

New position with 1987 changes

Subsequent career moves

Peter Wilenski

Chair, Public Service Board

Secretary, Transport and

Communications, 1987-8

Australian Ambassador,

United Nations, 1989-92;

Secretary, Foreign Affairs and

Trade, 1992-3;

Commonwealth Government

Adviser, 1993-4

Roger Beale

Commissioner, Public

Service Board

Associate Secretary,

Transport and

Communications, 1987-93

Associate Secretary, Prime

Minister and Cabinet,

1993-6; Secretary,

Environment, etc., since 1996

Bill Harris

Commissioner, Public

Service Bo ard

Associate Secretary, the Arts, Sport, the

Environment, Tourism and Territories, 1987-89

Head, ACT Chief Minister's

Department, 1989-93

Tony Ayers

Efficiency Security Unit

Secretary, Community Services and Health, 1987-88

Secretary, Defence, 1988-98

 

Appendix 3: Departmental Machinery of Government: significant changes since July 1987

  • 5 March 1990 : Abolition of the Department of Aboriginal Affairs. Its functions, and those of the Aboriginal Development Corporation, were assumed by the Aboriginal and To rres Strait Islander Commission
  • 7 June 1991: Housing transferred to the renamed Department of Health, Housing and Community Services
  • 27 December 1991: Department of Tourism. created. DASETT renamed Department of the Arts, Sport, the Environment and Territories (DASET)
  • 24 March 1993: Foll owing the 1993 elections, Arts was transferred from DASET (renamed Department of the Environment, Sport and Territories) to a renamed DAS; and local government was transferred to a renamed Department of Health, Housing, Local Government and Community Servi ces from a renamed Department of Immigration and Ethnic Affairs
  • 23 December 1993: Department of Transport and Communications split. Functions assigned to Department of Transport and Department of Communications
  • 30 January 1994: Arts function transferred to renamed Department of Communications and the Arts, DAS reverting to Department of Administrative Services
  • 25 March 1994: Department of Health, Housing, Local Government and Community Services split into Department of Human Services and Health and Departme nt of Housing and Regional Development
  • 11 March 1996 : When the Howard Government took office it abolished the departments of Housing and Regional Development and Tourism. Regional development was transferred to the Department of Transport and Regional Deve lopment whilst housing (except welfare housing) and tourism were absorbed by the renamed Department of Industry, Science and Tourism; welfare housing was assigned to the Department of Social Security. There were several substantial transfers of functions f rom the Attorney-General's Department which were not reflected in changes in the departmental nomenclature: business, corporations and securities law, and insolvency, were transferred to the Treasury; consumer affairs functions were transferred to the Depa rtment of Industry, Science and Tourism. The Department of Immigration and Ethnic Affairs was renamed Immigration and Multicultural Affairs upon transfer of the Office of Multicultural Affairs from the Department of the Prime Minister and Cabinet
  • 18 July 1 997: Upon transfer of the small business function from the Department of Industry, Science and Tourism, the Department of Industrial Relations was renamed the Department of Workplace Relations and Small Business
  • 9 October 1997 : Department of Administrative Services was abolished, most of its functions being vested in the newly named Department of Finance and Administration. The shipping and maritime functions of the Department of Transport and Regional Development were transferred to the Department of Workp lace Relations and Small Business. Meanwhile, the territories function was transferred to the Department of Transport and Regional Development and the sport function to the Department of Industry, Science and Tourism from a renamed Department of the Enviro nment, and
  • 21 October 1998 : After the 1998 elections, the employment function was transferred to the Department of Employment, Workplace Relations and Small Business from the renamed Department of Education, Training and Youth Affairs. Communications and t he Arts became the Department of Communications, Information Technology and the Arts; with the transfer of resources to the newly named Department of Industry, Science and Resources, the Department of Primary Industries and Energy became the Department of Agriculture, Fisheries and Forestry. Environment became the Department of the Environment and Heritage. A Department of Family and Community Services was fashioned from the residual parts of Social Security following establishment of Centrelink, the Child Support Agency transferred from the Australian Taxation Office and assorted related functions from the Attorney-General's Department and the Department of Health and Family Services, renamed Department of Health and Aged Care. Customs administration was tr ansferred from the Department of Industry, Science and Resources to the Attorney-General's Department. Shipping and maritime functions were returned to a renamed Department of Transport and Regional Services.

1 . Bob Hawke, The Hawke Memoirs , William Heinemann Australia, 1994, p. 416.


2 . Quoted in Canberra Bulletin of Public Administration , no. 52, October 1987, p. 17.


3 . Hawke, op. cit., p. 416.


4 . ibid., p. 415-418.


5 . ibid., p. 417.


6 . Ibid. See also R. J. L. Hawke, 'Challenges in Public Administration', 1988 Sir Robert Garran Memorial Oration, Australian Journal of Public Administration , vol. 48(1), March 1989, 9-16, at p. 11.


7 . For a history of the law of this matter, see Gavan Griffith, 'In the Matter of Ministers and Section 64 of the Constitution', Canberra Bulletin of Public Administration , no. 52, October 1987, 23-7, para. 1.5, pp. 24-5; see also Hawke, 'Challenges in Public Administration', p.11.


8 Zoeller v Attorney-General for the Commonwealth and others (1987) 16 FCR 153, paras 39-41.


9 . Report of the Royal Commission on Australian Government Administration (Chair: H. C. Coombs), Canberra, AGPS, 1976, 4.3.28-4.3.32, pp. 76-7.


10 . Sir William Cole, The Age , 16 July 1987, cited in Canberra Bulletin of Public Administration , no. 52, October 1987, p. 65.


11 . See, for example, Defence Review Committee (Chair: J. W. Utz), The Higher Defence Organisation in Australia , 1982, PP. 407/1982, vol. 27.


12 . Sir Richard Clarke, 'The Number and Size of Government Departments', Political Quarterly , 43, pp. 169-86, was an influential article in the early and mid-1970s.


13 . Michael Keating, 'Mega-departments: The Theory, Objectives and Outcomes of the 1987 Reforms', Patrick Weller et al., (eds.), Reforming the Public Service , Macmillan, 1993, p. 9.


14 . Michael Codd, 'Recent Changes in Machinery of Government', Canberra Bulletin of Public Administration , no. 54, May 1988, pp. 25-30 and 25.


15 . E. G. Whitlam, Australian Public Administration and the Labor Government , 1973 Sir Robert Garran Memorial Oration, Royal Institute of Public Administration, p.17.


16 . Cited in Colin Campbell and John Halligan, Political Leadership in an Age of Constraint , Allen and Unwin, 1992, p.179.


17 . See First and Second Reports of the Senate Select Committee on Matters Arising from Pay Television Tendering Processes (Chair: Senator B. Cooney), September and December 1993.


18 . Task Force on Management Improvement, The Australian Public Service Reformed . Canberra, AGPS, 1992, p. 82.


19 . Mike Codd, Federal Public Sector Management Reform—Recent History and Current Priorities, Public Service Commission, Canberra, 1991, p.5.


20 . Hawke, op. cit., p. 416.


21 . Peter Walsh, Confessions of a Failed Finance Minister , Random House Australia, 1995, pp. 170-1.


22 . Emma Craswell and Glyn Davis, 'Does the Amalgamation of Government Agencies Produce Better Policy Co-ordination', Patrick Weller et al.,(eds), op. cit., p. 204.


23 . These citations are drawn from the selection of media comment published in the Canberra Bulletin of Public Administration , no 52, October 1987, pp. 48-9 and 54-5.


24 . Sir William Cole, op. cit.


25 Canberra Bulletin of Public Administration, no. 52, October 1987, p. 48.


26 . Sir William Cole, op. cit.


27 . Cited ibid., p. 55.


28 . Walsh, op. cit., p. 170.


29 . Cited in Canberra Bulletin of Public Administration , no. 52, October 1987, p. 49.


30 . R. J. L. Hawke, House of Representatives Hansard, 15 September 1987, pp. 43-6.


31 . John Howard, House of Representatives Hansard, 15 September 1987, pp. 46-7.


32 . Department of the Prime Minister and Cabinet, Annual Report 1989-90, Canberra, AGPS, 1990, pp. 60-1.


33 . Dr Michael Keating, 'Mega-departments: The Theory, Objectives and Outcomes of the 1987 Reforms', Patrick Weller et al., (eds.), op. cit., p. 9.


34 . Task Force on Management Improvement, The Australian Public Service Reformed, Canberra, AGPS, 1992, p. 82.


35 .  Source unknown.


36 . Walsh, op. cit., p. 170.


37 . John Halligan, Ian Beckett and Paul Earnshaw, 'The Australian Public Service Reform Program', John Halligan and Roger Wettenhall (eds.), Hawke's Third Government , University of Canberra/Royal Institute of Public Administration Australia, 1992, p. 19.


38 . John Halligan, 'The process of reform: balancing principle and pragmatism', Jenny Stewart (ed.), From Hawke to Keating , University of Canberra/Royal Institute of Public Administration Australia, 1994, p. 9.


39 . Michael Codd, 'Cabinet Operations of the Australian Government', Brian Galligan et al., (eds.), Decision-making in Australian Government—the Cabinet and Budget processes , Canberra, ANU Federalism Research Centre/ RAIPA (ACT Division), 1990, p. 14.


40 . Campbell and Halligan, op. cit., pp. 177-183.


41 . Patrick Weller, in Patrick Weller et al., op. cit., p. 226.