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A new act for a new century: address to mark the commencement of the Public Service Act 1999, Canberra, 2 December 1999

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A New Act for a New Century

The Hon. Dr David Kemp MP

Minister Assisting the Prime Minister for the Public Service


Address to mark the commencement of the Public Service Act 1999

Canberra, 2 December 1999



Public Service Commissioner, Helen Williams, Dr Peter Shergold, Departmental Secretaries and other Agency Heads, Ladies and Gentlemen.

This Coming Sunday marks an historical milestone for the Australian Public Service (APS) with the implementation of the Public Service Act 1999.

For the first time in 77 years, we have a new Public Service Act. But more than just a new Act, we have a new way of managing our workplaces, and a renewed opportunity to build a high performance public service.

The passage of the Act represents a fundamental overhaul of Australian public sector management and is a major step forward in providing the basis for a truly high performance APS.

A Public Service for the future

The Government came to office in 1996 determined to undertake the structural reform essential to lift Australia's ability to compete in the global environment. We saw reform of the public sector as no less crucial to this aim than achieving our broader economic and industrial goals. Our vision for the future of Australia clearly recognised that the public sector was as important as the private sector to Australia's international success.

The Government found a public sector that was enmeshed in a rigid and complex operating framework where rules and processes triumphed over innovation and results. In an increasingly contestable environment, the APS was being denied the ability to compete on the basis of quality, effectiveness and efficiency. The system was not reflecting the calibre or the commitment of individual public servants.

The Government embarked on its program of structural reform, including bringing the focus in workplace relations onto the relationship between employer and employee, as the key to removing the barriers to innovation and the hurdles that inhibit high and sustainable economic growth. In the public sector, considerable progress has been made and I would like to acknowledge and thank the APS on behalf of the Government for the way in which you have responded to this vision. The way in which the APS has used the new flexibilities to improve its operations has been a true measure of your quality and professionalism.


An Integrated Framework

The Government's reform of public administration has three complementary parts, which together form an integrated vision for the future management of the public sector:

•  modernising the APS legislative framework - moving from a lengthy and prescriptive Act to the new principles-based legislation, and in the process giving agencies the freedom to be innovative in lifting performance;

•  complementing this framework with simplified awards and agreement-making processes through the Workplace Relations Act 1996 , thus providing a stronger basis for improving management-staff relations in the workplace, and boosting workplace productivity and competitiveness; and

•  transforming the APS management culture.


The need for a new Act

The real structural reform that the Government sought was impossible under the old legislation.

The Government inherited an Act that was passed by Parliament in 1922 and was based on approaches carried across from the nineteenth century colonial public services that existed before Federation. There was a preoccupation with process rather than results, management actions were highly regulated, and enormous effort went into maintaining standard terms, conditions and classifications across the Service.

The 1922 Act was a dead weight, holding back the flexible and innovative management of the APS.

We needed a new Act.

This was recognised by the previous government, and further pursued by the current Government.

You are all too familiar with the long, arduous, and at times disheartening, process that public sector reform, and this particular piece of legislation, have gone through. But the Government's persistence with public sector reform is a measure of the importance that we attach to the role of the APS in lifting Australia's competitive position.

The passage of the legislation represents a significant achievement on the part of all those who have invested so much in the reform of public administration over the last few years. Few pieces of legislation have been around for as long as the Public Serv ice Bill, as widely debated and consulted upon, through the parliamentary processes as often, or as eagerly anticipated by so many.

The agreement reached with the Opposition to secure the Bill's passage is of particular significance, because it means the Public Service Act 1999 has bipartisan support. The APS can therefore expect a period of legislative stability in which it can take up the new flexibilities to plan for the future by seeking out innovative management processes that achieve higher performance in the context of their particular business plans.


The 1999 Act

What then are the advantages of this new Public Service Act? It is significantly shorter - some 47 pages - less than one fifth the size of the 1922 Act. It is more accessible and understandable. It is written in plain English and within a clear legal framework, making it simpler and easy to follow.

The Act articulates the distinctive character of Australia's public service and Parliament's expectation of it. It sets out in primary legislation the public interest character of APS employment: the APS Values, the Code of Conduct and the definition of merit. It also sets down the important accountability provisions and the relationship of the public service to Ministers and to Parliament.

The detailed prescription of the 1922 Act has generally been replaced by principles and broad heads of power. The Act does not provide everything the Government wanted. The Government would have much preferred the Bill in its original form, for its brevity, its simplicity, and its focus on principles. The agreed amendments, while not significantly altering the substance of the original Bill, contain in our view some unnecessary detail and prescription.

The new Act also clearly reflects the Government's new public sector framework. Responsibility for employment decisions has been devolved to Agency Heads, vesting in them greater flexibility and authority to manage their own workplaces, and accountability for the use of those powers has been enhanced within a clearly defined values-base for the Service.


Workplace Relations

The reform of the public service legislation is closely related to, and being implemented within, the new workplace relations framework. The guiding policy principle for the development of new public service legislation was that APS employment should operate on the same basis as applies to the private sector, unless there are valid reasons why this should not be so.

The Government was determined to see the Workplace Relations Act applied to its own area of employment in order to provide a more flexible, less regulated workplace, that gave employees the same opportunities to access better pay for higher productivity that exists in other sectors. It has also provided the opportunity for agencies and staff to work together to develop workplace arrangements which best suit the organisation and its people, and which increase effectiveness and performance overall.

The success of these arrangements has been overwhelming. In the 2_ years since the Government's new arrangements were put in place, almost all public servants are in agencies with agreements certified by the AIRC and agreements covering the remainder are close to finalisation. In addition, some 4800 individual Australian Workplace Agreements have been made with public servants in the APS.

Through the efforts of public servants such as yourselves, the APS is being transformed from a centralised, highly unionised and conservative workplace to a dynamic organisation at the cutting edge of reform.

The new Public Service Act will provide an even firmer foundation for the enterprise-based approach that is central to the Workplace Relations Act. It gives Agency Heads the legislative backing for their employer powers and the flexibility to use th ose powers in ways which are modern, efficient and directly applicable to the requirements and structures of individual agencies.

In addition, with the passage of the new Public Service Act, the relationship between the Workplace Relations Act and the public service employment framework has been further simplified.

The Government has agreed that, while workplace arrangements will be primarily the responsibility of individual agencies, there should be certain common principles of APS employment. These will not be binding in the same way as the APS Values, but the Government stated in the Explanatory Memorandum on the new Public Service Act that it expects APS agencies to promote and embody them.

Even though agencies may have differing pay scales, having a common system of classifications across the APS will be important in the future to facilitate mobility at level and the application of merit in the case of promotions. The proposed new Classification Rules will continue to provide a legal mechanism for the APS classification structure that most agencies have already adopted in their agreements and AWAs.

The APS Award has already been updated to enable it to operate with the new Public Service Act. A recent breakthrough is the conversion of the APS Award from paid rates to minimum rates. APS agencies will have a single, simplified, minimum rates award that underpins their agreement making arrangements.


Working with the new Act

I would like now to focus on some particular elements of the new legislation and to discuss why they are central to the Government's vision for the public service.

The inclusion of clearly articulated APS Values in the Act was of fundamental importance. The real basis and integrating element of a career public service lies not in its regulations and procedures but in its ongoing values, its professionalism, its integrity and its impartial and responsive service to the government of the day.

The Australian Public Service is defined by its Values. They are an essential underpinning to high performance in organisations and are central to the public interest aspect of public sector employment. They are a manifestation of the democratic society that we serve and they reflect the expectations of that society.

The Public Service Commissioner will be issuing Directions in relation to each of the Values to assist agencies to determine their scope and application. Agency Heads are bound to uphold and promote the Values and agencies must now identify what the Values mean in practical terms within the context of their organisation, and must work to ensure that these Values are embedded in the agency's culture.

As part of the public interest provisions of the new Act, merit is for the first time defined in the legislation governing the Service in a clear and unambiguous way. Merit will continue to be the cornerstone for employment decisions in the APS. Merit is also protected by the prohibition in the Act on patronage and favouritism and the preservation of the apolitical nature of the APS through its Values.

Complementing the Values, the Code of Conduct is a positive indication of Parliament's endorsement of the behaviours that the Australian community expects of its public servants. The fact that the Code is legally enforceable will strengthen its role as a public statement of the standards of behaviour and conduct that are part of an ethical and professional Public Service.

These public interest provisions, and the accountability that flows from them, are an essential balance to the removal of unnecessary prescription and red tape and the devolvement of employment powers to Agency Heads.

The quid pro quo for the devolution of powers is the enhanced accountability for the use of those powers. New provisions for accountability include:

•  the requirement on the Public Service Commissioner to make an annual State of the Service Report for presentation to Parliament;

•  significant new inquiry and reporting powers for the Public Service Commissioner;

•  the inclusion of whistleblower protections in the Act for the first time;

•  transparent arrangements for determining the salaries of Secretaries of Departments;

•  the review provisions and the reporting powers of the Merit Protection Commissioner; and

•  the requirement for the Public Service Commissioner to issue Directions in relation to SES employment matters and the continuing role for the Commissioner in SES employment and termination decisions.


Frank and honest advice from a career Service

At this point I want to address two of the criticisms of the legislation that are occasionally heard from commentators:

•  that it politicises the APS, resulting in the loss of frank and honest advice to Government; and

•  that it is the end of the career public service.

These criticisms flow from a clear misunderstanding of the Government's vision for the APS.

The new Act contains more protections and a clearer statement of an apolitical Public Service than the 1922 Act. For the first time:

•  there is a legislated requirement that the APS upholds defined Values, including that the APS is apolitical, performing its functions in an impartial and professional manner;

•  there is a clear prohibition on patronage and favouritism; and

•  there is a specific provision that an Agency Head is not subject to direction by any Minister in relation to the exercise of powers in relation to particular individuals.

These provisions, taken hand in hand with the enhanced accountability arrangements, provide a far clearer state ment of the apolitical framework that governs the relationship between the political and bureaucratic systems than ever existed in the 1922 Act.

The second criticism, that the new Act spells the end of the career service, is based on the artificial notion that the APS is defined by standard terms, conditions and job classifications and by a guaranteed job for life.

The fundamental basis of a career service lies in its ongoing values, not in its regulations and processes. A career service is composed of professional, innovative and apolitical people that can provide impartial and high quality public interest advice and program delivery for successive governments. Public servants of the future will need to adapt to the changing environment to remain relevant. They will need to broaden their skills and experience both through development opportunities and through mobility, whether this is mobility within the Commonwealth sector, to the state public services, to the private sector or to the voluntary welfare sector. As an ongoing Service, it provides an unparalleled source of knowledge and experience, and the understanding and experience that result is of real value to the government of the day.

The Government strongly values the concept of a career service, and the new Act protects and enhances this.


The task ahead

The task now is to use the framework provided by the new Act to achieve high performance. The prescription and regulation that hindered APS management and which worked against innovation and creativity has been removed, along with the rigidity of the one-size-fits-all approach that pervaded public service employment practices. The assumption that the APS is a homogeneous organisation employing uniform people with similar skills, abilities, work requirements and career expectations has been superseded by an understanding that we need the flexibility to target requirements to particular needs.

Agencies must become used to making their own judgements on aspects of employment, within the framework of Government policy, rather than operating in a legalistic way within a constrained environment. The old prescription and rules worked to insulate agencies to a large extent from the need to think about what employment procedures will be of greatest benefit to their particular circumstances.

In particular, agencies will need to understand that removal of this prescription has also removed the detailed underpinning of the employment framework that was part and parcel of the old centralised approach. They should be aware that, where some of those detailed provisions have been removed, they will need to be replaced with agency-specific arrangements or the provisions will no longer operate.

In this context, let me strongly caution agencies against the risks of simply bringing over all the provisions prescribed by the 1922 Act for application to their agencies. There is little point in removing the prescriptive arrangements contained in the 1922 Act if they are going to be replaced by equally prescriptive arrangements at agency level. It is the Government's expectation that agencies will develop flexible, innovative and creative local arrangements within the new framework. Writing back the detailed provisions as a safety measure means that the opportunity to use the new flexibilities to improve performance will have been lost.


Vision for the APS

The Australian Public Service has a key and unique role in Australia's democratic system of government. An APS that is relevant and of high quality is part of the Government's vision for the public sector of the future.

Central to this vision is a more highly focused Service that is flexible, innovative and responsive, focussed on its core activities of policy advice, legislative implementation and the contracting and oversighting of service delivery.

Since it came to power, the Government has moved to reduce or terminate lower priority activities, rationalise functions, and privatise or outsource activities where they could be performed more effectively and efficiently by the private or voluntary welfare sector.

As the expectations and demands of citizens increase, contestability of APS functions will continue to be important to achieving the best that the country can offer. To be competitive, APS staff will require high level skills a capacity for innovative management, and an understanding of private sector good practice in addition to best practice in the public sector. Intellectual capital will be increasingly important and breadth of experience will be highly sought.

At the same time, the nature of the Service will evolve. The re cruitment base of the APS is already changing and the qualifications of entrants are rising. APS staff will be less committed to single organisations than in the past. Changes proposed to superannuation are likely to facilitate greater mobility between the Commonwealth and State services and between the public and private sectors. Desire by staff for security in employment will translate to a greater focus on maintaining and upgrading their Ôemployability', and they will expect employers to provide challenging work and development opportunities to contribute to this goal. Competitive remuneration will be a more important element in the recruitment and retention of valuable staff, but recognition and motivation of staff will also be crucial.

Employers will need to take active steps to manage the employment and expectations of their staff in order to maximise their investment in the intellectual capital that these staff represent.

The Service of the future will be less preoccupied by large-scale service delivery and regulation that were characteristic of the old bureaucracy. Its focus on flexible and responsive service to the public and to its other clients will be enhanced. Fair, effective, impartial and courteous service to the Australian public is written clearly into the APS Values. The focus for the new APS will be on innovative ways to meet client expectations and on responsiveness to the Government's own priority for client service in its broadest sense.

Finally, the provision of top quality, public interest policy advice is central to the Government's vision for the future of the APS. It is here, in particular, that a high performing public service provides a real competitive advantage for government. A career Service that is professional, apolitical and innovative, and that can capitalise on the knowledge and expertise built up through its experience of successive governments, is of immense value to the government of the day. It is high quality advice that provides the basis and the framework for the achievement of high quality results and high performance.



It seems a little unreal, for me personally and I'm sure the countless public servants involved in this reform process, that 2 _ years after the Government's Public Service Bill was first introduced into the Parliament by my predecessor Peter Reith, we are now only several days away from the proclamation of a new Public Service Act.

The Bill, and the reform agenda have been much talked about during the last couple of years, and many significant reforms have already been successfully implemented. In one sense, the passage and implementation of the Bill represents the last key plank in an historic raft of reforms. In another sense, the proclamation of the Act on Sunday heralds the beginning of a new era of public sector administration.

The cornerstones have now been laid in place Ð financial management reforms, workplace relations reforms and now the new Public Service Act. As we enter the new century, the challenge before all of us is to pick up the opportunities offered by the new stru cture and build upon these cornerstones a high performance Australian Public Service that will take Australia from strength to strength.

In closing, may I say that as Minister Assisting the Prime Minister for the Public Service, I am very proud of this new Act.

I am also particularly proud of, and would like to especially thank, all the staff in the PSMPC and DEWRSB with whom I have worked over the last couple of years to bring this legislation to fruition. Their reliability, dedication, perseverance and quality of advice throughout some challenging times has been unwavering. I know that they have been working particularly hard over the last few weeks as well, to gear up for the implementation of the Act, and are well on-track for Sunday's proclamation.

And I am also exceptionally proud of what you, as leaders of the Australian Public Service, have done and continue to do, in the name of good policy outcomes and good government for all Australians.

I have no doubt, that under the Public Service Act 1999 , the commitment, professionalism and innovation you bring to your work will continue and flourish.



jy  1999-12-03  16:23