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Towards public sector excellence: keynote address to the Australian Government Leadership Network (NSW) 2010 government business conference.

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Towards Public Sector Excellence

Keynote Address

Australian Government Leadership Network (NSW) 2010 Government Business Conference 7 May 2010

Good morning. Thank you Ian, for that introduction (Ian Govey - CEO Aust Government Solicitor). I’d like to acknowledge the traditional owners of these lands the Gadigal people of the Eora nation and pay my respects to their elders past and present.

• Dr Ian Watt AO - Secretary, Department of Defence • Ms Heather Ridout, CEO Australian Industry Group • Mr John L Schmidt, CEO Australian

Transaction Reports and Analysis Centre • Howard Whitton - ANZSOG Institute for Governance • Nicolas Wilson - Fair Work Ombudsman • Megan Pitt - AGLN Chair

Distinguished guests, ladies and gentlemen. I’m pleased to be able to join you for this year’s Government Business Conference. I trust it will spur a very productive series of discussions about public sector excellence.

I’d like to start by reminding you of what was, for me, the single most striking fact highlighted in the Blueprint for the Reform of Australian Government Administration that the Rudd Government commissioned last year.

That striking fact is this: almost 43% of all APS employees will be eligible to retire over the next ten years.1

For the SES, the proportion is even higher at almost 72%.2

The fact that a very large proportion of the public service will be retiring over a short period of time has profound implications for the future of public administration in this country.

The ageing of the public sector is of course a magnified version of the demographic crunch facing the labour market as a whole.

As the 2010 Intergenerational Report pointed out, right now, around 9% of our population (some 2 million people) is aged 70 years or older. This figure is expected to rise to 13% by 2021 and to 20% (around 5.7 million people) in 2051,3 placing greater demand on health, aged care and social services and reducing the proportion of the population participating in the workforce. By 2050 it’s projected

there will only be 2.7 people of working age to support each Australian aged 65 and over, compared to 5 working aged people per aged person today.4

That’s one of the reasons that the Rudd Government has moved to mandate increased retirement savings for every single Australian by gradually raising the super guarantee from 9% to 12% over seven years, commencing in 2013. It is also one of the key issues confronting Minister Burke as he begins to prepare the first comprehensive population strategy for Australia.

In a nutshell, in an ageing Australia, government and industry are going to have to come up with innovative ways to engage and service an aging population. This is easier said than done.

The Intergenerational Report argued we need to improve productivity and participation across the board. The distinguished advisory group on public service reform, chaired by Terry Moran, recommended that we boost our public sector workforce planning and skills and capabilities. We absolutely need to do those

things. In addition, we need to rethink the division of labour between the public and the private sectors when it comes to service delivery, and to reallocate human resources within the public sector to meet increased demands for staff in the social services.

Who will deliver services in an ageing Australia?

The boundaries between the public and private sectors have always moved with the times. They were redrawn in the 1980s and 90s due to the great push towards commercialisation, corporatisation and privatisation.

The demographic crunch will shift this dividing line again. What I suspect we’re going to see — in the Commonwealth and the states and territories alike — is fewer public servants overseeing more services delivered by the private sector. We’ll also see more people choosing to interact with government through trusted intermediaries such as private companies or non-government organisations, for example the senior citizen choosing to let their financial planner, or accountant or other personal representative deal with government for them.

Within the public sector, I expect more people will be shifted from administration to frontline delivery to cope with the demands of an ageing population for health and other social services. According to the latest State of the Service Report, the

proportion of employees reporting they work in service delivery or related roles has fallen from 24% to 20% across the APS.5 It is reasonable to assume that this figure will start to climb again when our pensioners turn to agencies like Centrelink and Medicare for help. I am also confident that Centrelink and their customers will look for strategies to streamline services where ever possible.

For Australians to receive the high quality services they expect and deserve, some major shifts in thinking will have to take place.

In 2008 the Prime Minister told heads of agencies and members of the SES that when it came to service delivery, he had no “ideological preference for the public sector, nor for the private sector.” “The question of how services are best delivered,” he pointed out, “has not been resolved conclusively in favour of either the market or the state.”6 The truth is the best option for service delivery differs with the circumstances.

Sometimes the private sector delivers services that are accessible, high quality and low cost. Other times the private sector underperforms. As the private — and, for that matter, the community — sector becomes an increasingly important part of the service delivery mix, it will have to perform to the standards the public demands. Meanwhile, the public sector needs to develop accountability and performance management mechanisms to handle an increased private sector role in service delivery, and to guarantee that limited public resources are being used wisely and well.

The public sector needs to be better at delivering services too. As the blueprint rightly recommends, we need greater in-house expertise in how to deliver services. We need common resources like APS-wide contracts and performance measurement tools. And we need feedback loops so that frontline staff, the people who know what’s workable and what’s needed, can be heard when and where it matters in the design process.

I recently spoke to 400 new APS graduates. The one thing I wanted them to take away from my speech was this: government isn’t just about policy, it’s about service delivery. I told the graduates that, if later in their career they found that they’d only ever worked on policy, then they needed to get out in the community, on the frontline, and work in service delivery. Without that understanding of what’s workable and what isn’t on the ground, and of what really matters to the Australian people, public servants are making policy blind. That message — even with all the public

service experience amassed in this room — is just as pertinent today.

As a former minister for human services, I’m passionate about the notion of citizen-centred service delivery. Put simply, this is the idea — at once radical and utterly obvious — that services should be delivered in the way that is most likely to give people what they need, not in the way that’s most convenient for public servants or Governments.

This was the idea behind the Child Support Agency’s ‘Building a Better CSA’ program. The CSA recognised that while they were a first-class collection agency, the primary concerns of separating and separated parents were changing, and were now around issues like care and shared parental decision-making. The result was that parents often viewed the CSA as insensitive, inconsistent and unaccountable.

The CSA responded by putting a lot of effort into improving its culture and its relations with customers. Its efforts to adopt a customer-focused approach to service delivery, characterised by responsive, accountable and empathetic interactions with customers have shown good results in improved customer satisfaction.

Public servants and politicians need to admit we’re not infallible, accept the fact that Canberra doesn’t have all the best ideas. The blueprint recognises that lot of the best ideas are out there in the communities and businesses directly affected by

policies and services, and that we need mechanisms to get that input into our policy development processes where and when it can make a difference.

Finally, the advisory group recommends using state and territory governments, local governments and the community and private sectors to deliver more services using simpler funding arrangements. That way Australians can get more locally co-ordinated services for complex issues.

For this to work, another major shift in thinking has to happen: the Commonwealth public sector has to address its suspiciousness of outsiders. It will have to outgrow a tendency to be inward-looking— — as competition for the top talent hots up in a shrinking labour market, and as the public demands — and deserves — a more open government, a closer relationship with government, and greater say in decisions that affect them.

Right now, mobility between the APS and the wider labour market is still not high enough. When you exclude APS 1-3 and graduate and trainee classifications, in 2008-09, the proportion of jobs filled externally was 32%.7

APS selection criteria — often described as nigh incomprehensible to anyone who’s not a public servant — stand as a potent symbol of the divide. The Integrated Leadership System was designed to create a level playing field within the public

service, and it was right to do that. But has it really done its job if it’s built a wall around the public service? I often hear reports that outsiders who aren’t completely put off applying by highly complex APS job specifications often fail to grasp what’s required in the application. I shudder to think what Don Watson would say.

Government 2.0

There are forces at work now which are helping to break down these barriers. One of the most powerful is government 2.0.

Public administration has a lot to gain from the use of web 2.0 tools, strategies and ways of thinking — that is, collaborative, participatory tools such as blogs, wikis and any other device that allows information not just to flow in one direction but in all

directions at once. Better use of web 2.0 in government could facilitate closer government engagement with the community and the private sector, strengthen public administration and government service delivery, improve government decision making, and allow us all to reap the democratic, social and economic benefits that can come when government information is freely available.

These changes are real and they are happening now. Over the last decade, household access to the internet has soared from 16 to 67% of households, with the result that in 2008, the internet was the most common way people last made contact with government.8

The first step is to make that contact easier, for example through a single log-on to government websites and a means for government agencies to share information so that people only need to tell them something once. For example our proposals to allow electors to re-enrol online are an absolute ‘no-brainer’, especially for younger Australians and those who move house a lot. They often find the existing paper process too much hassle, with the result that more than 1.3 million potential voters are not on Australia’s electoral roll.

Next the government and the public service need to accept and promote a freer flow of information and the increased scrutiny, discussion, comment and review of the government’s activities that come with that.

Let’s look at what information and communications technologies, and government 2.0 in particular, could do for service delivery. The internet is an efficient way to contact government and request the information and services you need. Going beyond that, government 2.0 methods can provide a way for the people who use government services to provide input into their design, for example through a blog hosted on a departmental website. That’s how the advisory group harvested a lot of the public comments that informed their blueprint, and how the government received feedback on its two green papers on electoral reform.

The government 2.0 taskforce that we appointed to propose how the Australian Government could make better use of the web 2.0 held a series of competitions to see what enterprising minds could do with government information. One of the initiatives that came out of this was the prosaically titled ‘It’s Buggered, Mate’ — a

website that allows users to notify the relevant authorities of public infrastructure — a lamppost, pothole, whatever — that needs fixing in their neighbourhood. It’s a very simple but powerful way to cut through layers of hassle and tell the government exactly what needs doing.

There are thorny questions we need to work through as we incorporate web 2.0 tools and ways of thinking into the everyday business of governing. These include how to make sure people who aren’t online aren’t left out, and how to switch the mindset in the public service from information control to information sharing. This year I’ll be asking agencies to engage more online and to chip away at the barriers to online take up so that the Australian Government and public can enjoy the benefits of a more interactive and open and transparent government.

Of course this engagement must not come at the expense of individual privacy and personal information protection. The public service will need to make sure its employees’ online engagement isn’t undermining their duty to protect confidentiality, privacy and accountability. Online engagement also mustn’t force public servants to step outside their proper role, whereby ministers are responsible and accountable for decisions about government policies and programs, while public servants are responsible and accountable for providing the information and evidence that ministers need to make those decisions, and for effectively implementing them.


Australia’s ageing population — and its ageing public service in particular — is going to change the way we deliver government services with more demand for complex, integrated social services. We need to avoid a destructive competition for talent and labour between the public and private sectors and instead move to a new way of working together and working more productively, and of focusing on what people need rather than the institutions and processes an agency will use to deliver a service.

As public service leaders based outside Canberra, you have unique insight into these questions of how to enhance service delivery in a changing Australia, and how to work with community, business and government partners to do that. I look forward to hearing your views. Thank you


1 Blueprint for the Reform of Australian Government Administration, p11. Exact figure is 42.6% 2 APSC, State of the Service 08-09, p68. Exact figure is 71.7% 3

Blueprint, p8. 4 Intergenerational Report, pviii. 5

State of the Service, pxvii. 6 7

State of the Service 08-09, p17. 8 Blueprint, p11.

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