Chapter 1Introduction and background
1.1The Public Service Amendment Bill 2023 (the bill) was introduced into the House of Representatives on 14 June 2023. It passed the House of Representatives on 1August 2023, and was introduced into the Senate on 2August 2023.
1.2On 22 June 2023, pursuant to Report No. 7 of 2023 of the Selection of Bills Committee, the Senate referred the provisions of the bill to the Senate Finance and Public Administration Legislation Committee for inquiry and report by 30August 2023.
1.3According to the bill's Explanatory Memorandum, the purpose of the bill is 'to deliver enduring transformational change, and ensure the Australian Public Service (the APS) is well placed to serve the Australian Government, the Parliament and the Australian public into the future'. The bill is the first piece of legislation put forward by the Australian Government that would introduce legislative measures (outside the October 2022 and May 2022 Budget allocations) exclusively aimed to implement the APS reform agenda.
Conduct of the inquiry
1.4The committee agreed to open submissions until 14 July 2023. The committee wrote to a range of key stakeholder groups, organisations and individuals, drawing their attention to the inquiry and inviting them to make a written submission.
1.5The committee received eight submissions, which are available on the committee's webpage and listed at Appendix 1.
1.6The committee held a public hearing in Canberra and via videoconference on 21August 2023. A list of witnesses can be found at Appendix2.
1.7Details of the inquiry, including links to the bill and associated documents, are published on the committee's website.
1.8The committee thanks submitters and witnesses for their involvement in the inquiry.
Report structure
1.9This chapter provides an overview of the conduct of the inquiry and the provisions of the bill.
1.10Chapter 2 outlines key issues raised about the bill in evidence and presents the committee's views and recommendation.
The Public Service Act 1999
1.11The Public Service Act 1999 (the Act) is the key piece of primary legislation underpinning the Commonwealth public service. The Act:
establishes the public service and sets out its Values and Code of Conduct;
provides the legal framework for the employment, management and leadership of APS employees;
defines the powers, functions and responsibilities of Agency Heads, the Australian Public Service Commissioner and the Merit Protection Commissioner; and
establishes the rights and obligations of APS employees.
1.12The Act establishes a Secretaries Board, which consists of:
the Secretary of the Department of Prime Minister and Cabinet (Chair);
the Secretary of each other Department under the APS;
the Public Service Commissioner; and
other persons nominated in writing by the Secretary of the Department of Prime Minister and Cabinet.
1.13The functions of the Secretaries Board include:
taking responsibility for the stewardship of the APS and for developing and implementing strategies to improve the APS;
identifying strategic priorities for the APS and considering issues that affect the APS;
setting an annual work program, and directing subcommittees to develop strategies to address APS‑wide issues and make recommendations to the Secretaries Board;
drawing together advice from senior leaders in government, business and the community; and
working collaboratively and model leadership behaviours.
1.14It should be noted that Commonwealth employees of parliamentary departments are employed under a separate act, the Parliamentary Service Act 1999. The political, ministerial and administrative staff of parliamentarians are employed under the Members of Parliament (Staff) Act 1984.
The APS Employee Census
1.15Since 2012, the Australian Public Service Commission (APSC) has conducted an annual survey to collect confidential information from APS employees on issues in their workplaces.
1.16Many agencies publicly report their Census results, with agency results often compared by news outlets such as the Canberra Times.
The Independent Review of the APS (Thodey Review)
1.17In May 2018, the former Government commissioned an independent review of the APS, led by David Thodey AO. The purpose of the Review was to 'ensure the APS is fit-for-purpose for the coming decades'. The Review aimed to 'identify an ambitious program of transformational reforms' that would 'guide and accelerate future reform activities'.
1.18The Review's final report was released in December 2019. The review made 40 recommendations, with recommendations going to:
undertaking regular capability reviews;
promoting continuous improvement through, among other forums, the APS Census;
promoting a shared understanding of the APS and its role alongside the Executive branch of government and the Parliament;
developing and embedding an inspiring purpose and vision to unite the APS in serving the nation;
reinforcing APS institutional integrity;
strengthening APS partnerships with ministers by improving support and ensuring clear understanding of roles, needs and responsibilities;
reviewing the form, function and number of government bodies to ensure they remain fit-for-purpose;
streamlining management and adopting best-practice ways of working to reduce hierarchy, improve decision-making and bring the right APS expertise and resources;
strengthening the primacy, role and performance of the Secretaries Board;
clarifying and reinforcing APS leadership and responsibilities; and
ensuring confidence in the appointment of all agency heads.
The Government's reform agenda
1.19The October 2022–23 Budget committed $40.8 million for the Department of Prime Minister and Cabinet (PM&C) and the APSC to 'develop and implement an ambitious reform plan to strengthen the APS'.
1.20The May 2023–24 Budget allocated a further $8.4 million to projects intended to 'uplift capability across the [APS], including cultural competency, gender impact analysis and futures analysis skills for APS staff', along with $10.9 million over two years as 'start-up funding' to establish an in-house APS consulting service. Treasury was also allocated $10.1 million over four years and $2.1 million per year on an ongoing basis to 'establish a central evaluation function within Treasury to provide leadership and improve evaluation capability across Government, including support to agencies and leading a small number of flagship evaluations each year'.
1.21The APS Reform Office is located within PM&C. It manages the implementation of the APS Reform agenda, including implementing the recommendations of the Thodey Review, and aims to 'evolve and support new ideas, best practice and innovation across the APS'. The APS Reform Office works with the Secretaries Board, the APSC, the Department of Finance and other agencies to deliver APS reforms.
1.22Areas of reform that the Government has stated are yet to come include implementing the recommendations of the Royal Commission into the Robodebt Scheme, and reforms expected to be proposed by an Integrity Taskforce established within PM&C.
The Public Service Amendment Bill 2023
1.23The Public Service Amendment Bill 2023 (the bill) would amend the Public Service Act 1999 to implement parts of the Government's APS Reform agenda. According to the bill's Explanatory Memorandum, the bill forms 'a key reform of the Government's APS Reform agenda'. In particular:
Amendments in the Bill support the Government's APS Reform priority to create an APS that acts with integrity in everything it does. Initiatives in this area will build public trust and strengthen standards of integrity in our federal government.
1.24In the bill's second reading speech, the Hon. Patrick Gorman MP, Assistant Minister to the Prime Minister, argued that the bill supports each of the four priorities of the APS Reform agenda:
an APS that embodies integrity in everything it does;
an APS that puts people and business at the centre of policy and services;
an APS that is a model employer; and
an APS that has the capability to do its job well.
1.25The Assistant Minister further stated that the bill '…is about restoring the public's trust and faith in government and institutions'. He contended that the reforms proposed in the bill 'will strengthen the APS's core purpose and values; build the capability and expertise of the APS; and support good governance, accountability and transparency'. The bill is the first piece of legislation to introduce legislative measures (outside the October 2022 and May 2022 Budget allocations) exclusively aimed to implement the APS Reform agenda.
Provisions of the bill
1.26In brief, the amendments in the bill would see the following changes made to the Act:
insert a new APS Value of stewardship:
- 'The APS builds its capability and institutional knowledge, and supports the public interest now and into the future, by understanding the long-term impacts of what it does';
require the Secretaries Board to 'cause' an APS Purpose Statement to be prepared;
explicitly provide that Ministers must not direct agency heads on individual employment matters for the APS;
require agency heads to implement measures to create a work environment that would enable decisions to be made by APS employees at the lowest appropriate classification;
see the APS Commissioner and the Secretary of the Department of the Prime Minister and Cabinet require regular capability reviews of each department, Services Australia, the Australian Taxation Office (ATO) and the Australian Public Service Commission (APSC);
require the Secretaries Board to request and publish regular, long-term insights reports;
require agencies to publish their annual APS Employee Census results and action plans to address relevant findings, with the results to be published in aggregate on their websites with limited exceptions (including for national security reasons); and
remove the existing requirement in the Act to seek the Australian Public Service Commissioner's consent to delegate powers and functions to Australian Defence Force members.
Financial impact
1.27According to the Explanatory Memorandum, the bill has 'nil financial implications at this time'. The Government has allocated initial funding to:
the Australian Public Service Commission to Pilot APS Capability Reviews in 2022–23, 2023–24 and 2024–25; and
the Department of Prime Minister and Cabinet to develop and deliver long-term insight briefings over the same period.
1.28 Funding for future capability reviews and insight briefings after this period 'remains subject to a future government decision, informed by evaluations of the pilots of these activities'.
Compatibility with human rights
1.29According to the Explanatory Memorandum, the bill is compatible with the human rights and freedoms recognised or declared in the international instruments listed in section 3 of the Human Rights (Parliamentary Scrutiny) Act 2011.
Examination by other parliamentary committees
1.30The Senate Standing Committee for the Scrutiny of Bills (Scrutiny of Bills Committee) examined the provisions of the bill in its report tabled 2August2023. That committee had sought the advice of the Minister about:
whether the bill could be amended to require documents created by capability reviews, long-term insights reports and action plans responding to census results be tabled in the Parliament; or
why it is appropriate that the above documents not be tabled in Parliament.
1.31The Minister for the Public Service (the Minister), when responding to the committee, contended that as there will be a requirement to publish the above reports on an agency website, 'the bill would not be improved by requiring the tabling of these documents'. The Minister also argued that the documents are internally focused and, as such, 'would not be further serviced by tabling in the Parliament as these processes and resulting documents perform an enabling function, rather than one that requires the Parliament to act'. Further, the bill does not preclude the tabling of documents.
1.32The Scrutiny of Bills Committee reiterated its view that the documents 'are relevant to understanding the performance of governmental departments and agencies'. In addition, they include 'documents that appear to be directed at improving transparency and external scrutiny of performance of government agencies'. The Scrutiny of Bills Committee argued that tabling the documents in Parliament would alert 'parliamentarians to the existence of documents and provides opportunities for debate that are not available where documents are not made public or are only published online'. The Scrutiny of Bills Committee left it to the Senate as a whole to determine the appropriateness of not requiring the documents to be tabled in each House of the Parliament.
1.33The Scrutiny of Bills Committee also requested detailed advice on whether the bill could be amended to include safeguards to protect the personal details of non-Senior Executive Service employees in capability reviews. The Minister advised that personal information collected in the initial analysis stages of consultation during capability reviews would be subject to the Privacy Act 1988 and would not include publication of information that could reasonably identify individuals. However, the Minister stated that she had asked the Department of Prime Minister and Cabinet to examine whether it would be appropriate to amend the bill with regard to this matter.
1.34The Scrutiny of Bills Committee requested 'that an addendum to the explanatory memorandum containing the key information provided by the minister be tabled in the Parliament as soon as practicable', and noted the importance of these explanatory materials being a point of access to understanding the law and as extrinsic material to assist with interpretation.
1.35As at 28 August 2023, no supplementary explanatory memorandum or revised explanatory memorandum had been published on the bill's homepage on the Parliament House website.
1.36The Scrutiny of Bills Committee also requested advice on whether it is necessary and appropriate to allow an Agency Head to delegate any of their powers or functions to a member of the Australian Defence Force, and whether the bill could be amended to provide explicit guidance on the scope of powers that might be delegated, or to limit the categories of people to whom such powers might be delegated. The Minister subsequently advised that this amendment would bring the Act in line with other updates made to the Public Service Regulations 2023, and would enable agencies that include members of the Australian Defence Force to operate in an integrated manner. The Minister also argued that limiting the scope of such powers would be unlikely to be practicable, given how broad the functions of agencies are, and that some agencies have very few Senior Executive Service (SES) members.
1.37The Scrutiny of Bills Committee reiterated its concerns about the broad delegation of any powers by the Secretary of Defence and agency heads 'to any individual who is not an outsider, regardless of the nature of the power'. That committee also expressed its concern that there was no requirement on the face of the bill for such powers to be delegated to employees with the appropriate skills, qualifications or experience. That committee was of the view that it 'remains unclear… why the bill cannot be amended to require Agency Heads to delegate powers to SES employees or to individuals who possess the requisite skills, qualifications or experience'. That committee left it to the Senate as a whole to determine the appropriateness of leaving the proposed amendment in the bill on delegated powers as is.
1.38The Parliamentary Joint Committee on Human Rights had no comment to make on the human rights implications of the bill in its report tabled on 2August2023.