	Public Service Commissioner Annual Report 2003-04 incorporating the annual report 2003-04 of the merit protection commissioner	1

	Public Service Commissioner’s review Andrew Podger, Public Service Commissioner The last 12 months has seen considerable progress by the Commission in our two key strategic priorities: evaluation and assurance, and building the capability of the APS. These two responsibilities, drawn from the functions set out in the Public Service Act 1999 (PS Act), have been highlighted in recent Commission Corporate Plans and Portfolio Budget Statements. We also foreshadowed an increased profile to represent the APS publicly and, while we have done so cautiously, that has attracted wide support. Overall, therefore, I am confident of the directions we are pursuing. An important focus has been to ‘hardwire’ concepts such as values and leadership, to get beyond the rhetoric and to provide practical support for agencies to help them achieve their business objectives, and to work better together in the public interest. Critical to this has been a collaborative approach with agencies, combined with better evidence through research and statistical analysis. In this way we have been able to contribute to continued public sector reform. International recognition A major highlight of the year was the receipt of the United Nations award for Improvement of the Quality of Public Service Process in the Asia Pacific Region that I accepted on behalf of the APS in New York on 23 June 2004. The award, introduced by the United Nations in 2000 to recognise best practice in public administration, is awarded over four categories and four geographic zones. Presentation of the award recognises the substantial public sector reforms that have taken place in the APS over more than 20 years culminating in the PS Act. It recognises the APS’ achievements in serving the public interest and its significant contribution to improving public administration in Australia. It is also recognition of the contributions of the thousands of Australian public servants who take pride in serving their community. Achievements and disappointments As mentioned in last year’s Annual Report, we completed an evaluation on managing values in agencies in 2003. Two significant publications were issued in August 2003 providing advice to APS employees and Agency Heads (APS Values and Code of Conduct in Practice, a Guide to Official Conduct for APS Employees and Agency Heads) and a good practice guide for senior managers (Embedding the APS Values). There has been extensive follow-up activity across the Service, promoted by the Commission, with evidence emerging of broader understanding of the APS Values and of their importance to all agencies and all employees. Our evaluation and assurance role was also enhanced by the strengthened evidence base in the State of the Service Report, and the further evaluations undertaken over the last year. Evidence is critical to my ability to speak authoritatively and openly on the contemporary issues facing the APS, and about our performance and capability. Our role in helping to build the capability of the APS was strengthened considerably by the work done to develop an Integrated Leadership System (ILS). The Government agreed to the Commission drawing on its accumulated reserves for this investment, which builds on the Senior Executive Leadership Capability Framework we have used for SES selection and development purposes for the last five years. The ILS will help agencies and senior APS staff to improve leadership and management skills and to address succession management. It is a practical tool that can be adapted to different agency requirements and recognises the varying mix of leadership, management and technical skills required at different levels in different agencies. The Australia and New Zealand School of Government (ANZSOG) has also strengthened its position during the year, both in teaching and more recently in research, with substantial Commission support. The School represents an important investment in public sector capability for the future. Our agenda to improve capability was also advanced through initiatives related to Indigenous employment, recruitment and selection in the APS, workforce planning and MAC work on whole-of-government management. As mentioned in the State of the Service Report, Indigenous employment has stalled in the APS, and the Commission is looking to address obstacles by trialling alternative recruitment and career pathway strategies and establishing support networks. Significant progress was made during the year. The Commission’s ‘Get it Right’ kit for APS selection and recruitment has proven to be a great success. It is highly innovative and practical, and is being taken up widely across the APS along with attracting some international interest. There has been extensive follow-up activity by the Commission to the Management Advisory Committee (MAC) Report 3–Organisational Renewal, with the release of documents aimed to assist mature age workers, a series of workshops and seminars on workforce planning, and measures to allow agencies better access to Commission data on APS employees. The MAC Report 4–Connecting Government, released in April 2004, is another substantial body of work which should enhance APS capability and performance over the next few years. Over the last two years we have also begun to re-focus our international work, and to invest in capability building in our region in partnership with AusAID. While there is some way to go to put this activity onto a firm financial footing, I am pleased that our priorities now directly match Australian Government priorities, that personal relationships have been established or deepened with counterparts in PNG, Fiji, the Solomon Islands, Samoa, Indonesia and Thailand in particular, and that a number of initiatives have been taken in the Pacific. On the downside, we have not achieved all the targets we set, and there have been slippages amongst some of our projects, including the Indigenous Employment Strategy. This needs to be assessed against the more ambitious program of activities we have pursued over the last two years, which took advantage of recent growth in non-budget revenues. Unfortunately, that growth did not continue into 2003—04. International perspective Some meetings during the year with counterparts in the UK, Canada and New Zealand in particular have allowed me to reflect on some of the relative strengths and weaknesses of the APS in areas of particular interest to the Commission. Our record in public sector reform is a comparative strength, partly because of our long-term, steady, incremental advance based on pragmatism. The APS seems to be particularly agile and responsive to change generally, and specifically to citizens’ requirements and to the elected Government. The role and work of the Commission is at the forefront of supporting such flexibility through values-based management and leadership development in a flexible, devolved administrative system, and we are as good as any in evaluating the state of the public service. While the significant effort in the other nations to improve government co-ordination (eg "joined up government", "horizontal management") offers lessons for us, our Cabinet processes in particular appear to be the best around, well served by all the co-ordinating agencies. The other countries have developed more elaborate processes for senior appointments, including substantial investment in succession management and executive search beyond the central public service. The Commission does not have any statutory role in this area but, with the support of Agency Heads, we have further extended our support for the role played by the Secretary of Prime Minister and Cabinet in advising on senior appointments. We have also provided support for top-level succession management. All these Westminster-based systems are facing new challenges in the relationship between the public service and Ministers and their advisers, particularly with the increased role of advisers and increased media scrutiny of government. With substantially more advisers in Australia than elsewhere, these challenges appear to be somewhat greater here. The Commission’s efforts to find ways to promote professionalism, amongst both public servants and advisers, and to build relationships of trust based on mutual understandings of respective roles and responsibilities are consistent with the work being done in the other countries. Client feedback Results from the 2003 client survey show high levels of overall satisfaction with the Commission and its services with almost 80% of respondents indicating they were satisfied. While there was little difference between categories of respondents (Agency Heads, Heads of Corporate or HR executives) there were significant differences between large agencies (expressing 90% satisfaction) and small agencies (69% satisfaction). Satisfaction with the Commission was clustered around four broad themes: the general direction of the Commission’s work in taking a stronger role in evaluation and building the capability of the APS the services and products offered by the Commission through its 5 output areas the professionalism, responsiveness and helpfulness of staff and the service quality the Commission provides the quality of its knowledge and advice. Areas suggested for improvement were clustered around three themes: the Commission’s approach which was seen by some respondents as being too cautious roles and relevance of the Commission especially in a decentralised environment with calls for more clarity of function for the Commission vis-à-vis other central agencies service delivery and specific needs of small agencies. Enhancing our internal capability To deliver in these areas requires strong internal capability within the Commission, especially in relation to our credibility, expertise and effective use of information. The Commission has been giving priority over the last 12 months to: workforce planning and a more structured approach to deepening our skills base improving our communications with agencies and individual APS employers. Financial performance The Commission’s activities are funded through a mix of Budget funding and revenue generated through activities provided on a fee-for-service basis. Over the last three years the funding generated from fee-for-service activities has increased from $10.132m to $12.289m and now represents 43% of total budget. The Commission had built up some additional reserve funds over recent years. During 2003—04, with the agreement of the Government, some of these funds were invested in development work in leadership development and Indigenous employment in the APS. This investment was foreshadowed in last year’s annual report, and approved through the Additional Estimates process. Despite this additional investment, the Commission’s operating outcome for 2003—04 was a loss of $1.229 million. The loss largely arises from a greater than estimated expenditure in providing leadership, learning and development programs to APS employees that was not matched by revenue growth. There was also some variance between estimates and results achieved in some other outputs, some of which reflect problems in the way the Commission set its financial estimates in the PBS, rather than poor financial management during the year. The Commission has sufficient funds to cover the operating loss and is confident in its programs and financial outlook for 2004—05 and beyond. In particular, the Integrated Leadership System will refresh the Commission’s learning and development activities and ensure their close alignment with agency needs. We are also giving priority to further strengthening our financial management systems and skills. As additional investment in leadership development and Indigenous employment will also largely conclude in 2004—05, we are moving to a more conservative approach to our work program during 2004—05. The Commission received an unqualified audit report in respect of its financial accounts for the 2003—04 financial year. Outlook for the future My assessment of the Commission’s outlook is informed by the views of agency heads and colleagues in other jurisdictions (in Australia and overseas) as well as our experience over the last year. The challenges the Commission will need to respond to include: the need to improve our understanding of the context in which the APS will be operating over the next few years (including the impact of demography and new technology, and changing community expectations), in order to address changing capability requirements against the supply of suitably skilled people leadership development and succession management to deal with the impending changing of the guard, with the Commission needing to place particular effort into the practical application of our new Integrated Leadership System and to work closely with other jurisdictions particularly through ANZSOG. The Commission should also look to provide improved support to the Secretary of PM&C and the Government for senior appointments increased pressure for whole-of-government responses to community concerns, and the importance of a supportive culture particularly amongst the SES but also in the regions and amongst EL staff Indigenous employment, with the added challenge now to support the new administrative arrangements for delivering Indigenous services performance management, and the continuing debate on its links with recognition and reward systems attuned to the public sector environment building public administration research capacity, including in liaison with ANZSOG consolidating our international program of assistance to developing countries in the Pacific and South East Asia, particularly Papua New Guinea the demand for stronger public presentation about the role of the APS, its strengths and its challenges. As mentioned, we have been addressing the last challenge, but it does require some careful balancing by me as Commissioner. I am a statutory officer with independent powers. I am also an adviser to the Government, through the Minister Assisting the Prime Minister on the Public Service. Nonetheless, I will continue to look for opportunities to explain and promote the role of the Australian Public Service in Australia’s democratic system of government. This page is available from www.apsc.gov.au/annualreports/0304/review.htm For information and help with this site go to Using our site	Overview index Overview Home Index Glossary Download the PDF In this part Commissioner's review UN Award for APS Commission overview
Overview index Overview Home Index Glossary Download the PDF

Public Service Commissioner’s review

Andrew Podger, Public Service Commissioner

The last 12 months has seen considerable progress by the Commission in our two key strategic priorities: evaluation and assurance, and building the capability of the APS. These two responsibilities, drawn from the functions set out in the Public Service Act 1999 (PS Act), have been highlighted in recent Commission Corporate Plans and Portfolio Budget Statements. We also foreshadowed an increased profile to represent the APS publicly and, while we have done so cautiously, that has attracted wide support.

Overall, therefore, I am confident of the directions we are pursuing.

An important focus has been to ‘hardwire’ concepts such as values and leadership, to get beyond the rhetoric and to provide practical support for agencies to help them achieve their business objectives, and to work better together in the public interest. Critical to this has been a collaborative approach with agencies, combined with better evidence through research and statistical analysis. In this way we have been able to contribute to continued public sector reform.

International recognition

A major highlight of the year was the receipt of the United Nations award for Improvement of the Quality of Public Service Process in the Asia Pacific Region that I accepted on behalf of the APS in New York on 23 June 2004. The award, introduced by the United Nations in 2000 to recognise best practice in public administration, is awarded over four categories and four geographic zones.

Presentation of the award recognises the substantial public sector reforms that have taken place in the APS over more than 20 years culminating in the PS Act. It recognises the APS’ achievements in serving the public interest and its significant contribution to improving public administration in Australia. It is also recognition of the contributions of the thousands of Australian public servants who take pride in serving their community.

Achievements and disappointments

As mentioned in last year’s Annual Report, we completed an evaluation on managing values in agencies in 2003. Two significant publications were issued in August 2003 providing advice to APS employees and Agency Heads (APS Values and Code of Conduct in Practice, a Guide to Official Conduct for APS Employees and Agency Heads) and a good practice guide for senior managers (Embedding the APS Values). There has been extensive follow-up activity across the Service, promoted by the Commission, with evidence emerging of broader understanding of the APS Values and of their importance to all agencies and all employees.

Our evaluation and assurance role was also enhanced by the strengthened evidence base in the State of the Service Report, and the further evaluations undertaken over the last year. Evidence is critical to my ability to speak authoritatively and openly on the contemporary issues facing the APS, and about our performance and capability.

Our role in helping to build the capability of the APS was strengthened considerably by the work done to develop an Integrated Leadership System (ILS). The Government agreed to the Commission drawing on its accumulated reserves for this investment, which builds on the Senior Executive Leadership Capability Framework we have used for SES selection and development purposes for the last five years. The ILS will help agencies and senior APS staff to improve leadership and management skills and to address succession management. It is a practical tool that can be adapted to different agency requirements and recognises the varying mix of leadership, management and technical skills required at different levels in different agencies.

The Australia and New Zealand School of Government (ANZSOG) has also strengthened its position during the year, both in teaching and more recently in research, with substantial Commission support. The School represents an important investment in public sector capability for the future.

Our agenda to improve capability was also advanced through initiatives related to Indigenous employment, recruitment and selection in the APS, workforce planning and MAC work on whole-of-government management.

As mentioned in the State of the Service Report, Indigenous employment has stalled in the APS, and the Commission is looking to address obstacles by trialling alternative recruitment and career pathway strategies and establishing support networks. Significant progress was made during the year.

The Commission’s ‘Get it Right’ kit for APS selection and recruitment has proven to be a great success. It is highly innovative and practical, and is being taken up widely across the APS along with attracting some international interest.

There has been extensive follow-up activity by the Commission to the Management Advisory Committee (MAC) Report 3–Organisational Renewal, with the release of documents aimed to assist mature age workers, a series of workshops and seminars on workforce planning, and measures to allow agencies better access to Commission data on APS employees. The MAC Report 4–Connecting Government, released in April 2004, is another substantial body of work which should enhance APS capability and performance over the next few years.

Over the last two years we have also begun to re-focus our international work, and to invest in capability building in our region in partnership with AusAID. While there is some way to go to put this activity onto a firm financial footing, I am pleased that our priorities now directly match Australian Government priorities, that personal relationships have been established or deepened with counterparts in PNG, Fiji, the Solomon Islands, Samoa, Indonesia and Thailand in particular, and that a number of initiatives have been taken in the Pacific.

On the downside, we have not achieved all the targets we set, and there have been slippages amongst some of our projects, including the Indigenous Employment Strategy. This needs to be assessed against the more ambitious program of activities we have pursued over the last two years, which took advantage of recent growth in non-budget revenues. Unfortunately, that growth did not continue into 2003—04.

International perspective

Some meetings during the year with counterparts in the UK, Canada and New Zealand in particular have allowed me to reflect on some of the relative strengths and weaknesses of the APS in areas of particular interest to the Commission.

Our record in public sector reform is a comparative strength, partly because of our long-term, steady, incremental advance based on pragmatism. The APS seems to be particularly agile and responsive to change generally, and specifically to citizens’ requirements and to the elected Government. The role and work of the Commission is at the forefront of supporting such flexibility through values-based management and leadership development in a flexible, devolved administrative system, and we are as good as any in evaluating the state of the public service. While the significant effort in the other nations to improve government co-ordination (eg "joined up government", "horizontal management") offers lessons for us, our Cabinet processes in particular appear to be the best around, well served by all the co-ordinating agencies.

The other countries have developed more elaborate processes for senior appointments, including substantial investment in succession management and executive search beyond the central public service. The Commission does not have any statutory role in this area but, with the support of Agency Heads, we have further extended our support for the role played by the Secretary of Prime Minister and Cabinet in advising on senior appointments. We have also provided support for top-level succession management.

All these Westminster-based systems are facing new challenges in the relationship between the public service and Ministers and their advisers, particularly with the increased role of advisers and increased media scrutiny of government. With substantially more advisers in Australia than elsewhere, these challenges appear to be somewhat greater here. The Commission’s efforts to find ways to promote professionalism, amongst both public servants and advisers, and to build relationships of trust based on mutual understandings of respective roles and responsibilities are consistent with the work being done in the other countries.

Client feedback

Results from the 2003 client survey show high levels of overall satisfaction with the Commission and its services with almost 80% of respondents indicating they were satisfied. While there was little difference between categories of respondents (Agency Heads, Heads of Corporate or HR executives) there were significant differences between large agencies (expressing 90% satisfaction) and small agencies (69% satisfaction). Satisfaction with the Commission was clustered around four broad themes:

the general direction of the Commission’s work in taking a stronger role in evaluation and building the capability of the APS
the services and products offered by the Commission through its 5 output areas
the professionalism, responsiveness and helpfulness of staff and the service quality the Commission provides
the quality of its knowledge and advice.

Areas suggested for improvement were clustered around three themes:

the Commission’s approach which was seen by some respondents as being too cautious
roles and relevance of the Commission especially in a decentralised environment with calls for more clarity of function for the Commission vis-à-vis other central agencies
service delivery and specific needs of small agencies.

Enhancing our internal capability

To deliver in these areas requires strong internal capability within the Commission, especially in relation to our credibility, expertise and effective use of information. The Commission has been giving priority over the last 12 months to:

workforce planning and a more structured approach to deepening our skills base
improving our communications with agencies and individual APS employers.

Financial performance

The Commission’s activities are funded through a mix of Budget funding and revenue generated through activities provided on a fee-for-service basis. Over the last three years the funding generated from fee-for-service activities has increased from $10.132m to $12.289m and now represents 43% of total budget.

The Commission had built up some additional reserve funds over recent years. During 2003—04, with the agreement of the Government, some of these funds were invested in development work in leadership development and Indigenous employment in the APS. This investment was foreshadowed in last year’s annual report, and approved through the Additional Estimates process.

Despite this additional investment, the Commission’s operating outcome for 2003—04 was a loss of $1.229 million. The loss largely arises from a greater than estimated expenditure in providing leadership, learning and development programs to APS employees that was not matched by revenue growth. There was also some variance between estimates and results achieved in some other outputs, some of which reflect problems in the way the Commission set its financial estimates in the PBS, rather than poor financial management during the year.

The Commission has sufficient funds to cover the operating loss and is confident in its programs and financial outlook for 2004—05 and beyond. In particular, the Integrated Leadership System will refresh the Commission’s learning and development activities and ensure their close alignment with agency needs. We are also giving priority to further strengthening our financial management systems and skills.

As additional investment in leadership development and Indigenous employment will also largely conclude in 2004—05, we are moving to a more conservative approach to our work program during 2004—05.

The Commission received an unqualified audit report in respect of its financial accounts for the 2003—04 financial year.

Outlook for the future

My assessment of the Commission’s outlook is informed by the views of agency heads and colleagues in other jurisdictions (in Australia and overseas) as well as our experience over the last year.

The challenges the Commission will need to respond to include:

the need to improve our understanding of the context in which the APS will be operating over the next few years (including the impact of demography and new technology, and changing community expectations), in order to address changing capability requirements against the supply of suitably skilled people
leadership development and succession management to deal with the impending changing of the guard, with the Commission needing to place particular effort into the practical application of our new Integrated Leadership System and to work closely with other jurisdictions particularly through ANZSOG. The Commission should also look to provide improved support to the Secretary of PM&C and the Government for senior appointments
increased pressure for whole-of-government responses to community concerns, and the importance of a supportive culture particularly amongst the SES but also in the regions and amongst EL staff
Indigenous employment, with the added challenge now to support the new administrative arrangements for delivering Indigenous services
performance management, and the continuing debate on its links with recognition and reward systems attuned to the public sector environment
building public administration research capacity, including in liaison with ANZSOG
consolidating our international program of assistance to developing countries in the Pacific and South East Asia, particularly Papua New Guinea
the demand for stronger public presentation about the role of the APS, its strengths and its challenges.

As mentioned, we have been addressing the last challenge, but it does require some careful balancing by me as Commissioner. I am a statutory officer with independent powers. I am also an adviser to the Government, through the Minister Assisting the Prime Minister on the Public Service. Nonetheless, I will continue to look for opportunities to explain and promote the role of the Australian Public Service in Australia’s democratic system of government.

This page is available from www.apsc.gov.au/annualreports/0304/review.htm
For information and help with this site go to Using our site