Connecting Across Boundaries—Making the Whole of Government Agenda Work

Steve Sedgwick
Public Service Commissioner

19 November 2010

Keynote address: The New Whole of Government Framework

Good morning and thank you to the organisers for inviting me to give this closing keynote address.

Let me begin by acknowledging the traditional owners of this land, and pay my respects to elders both past and present.

Introduction

For those of you who have—presumably in the interests of connecting across boundaries— come to this conference from interstate or overseas, I hope you have found it a pleasant experience, and can also find the time to see a bit of our national capital while you are here.

The theme of today’s session is emerging issues and trends in connecting across government in the Australian federal public sector.

I’ve been asked, in this context, to talk about the ‘new whole of government framework’.

Whole of government is not new

Let me say, at the outset, that whole of government is not a new issue.

The descriptive phrase ‘whole of government’ may be a relatively recent formulation, but there has always been the need for coordination and collaboration across government.  The character and extent of how Australian Public Service (APS) agencies work across boundaries has been changing and evolving over the course of our history, but it has long been a feature of our administration.

When the Coombs inquiry reported in 1976, for example, it called for (amongst other things) stronger policy co-ordination across government through the Department of the Prime Minister and Cabinet and more positive steps designed to enhance the flow of information to the community.

There were concerns at the time that departments were operating too independently of each other and possibly of government and that the APS was less responsive to the government of the day and their interpretation of changing community needs than it should have been.

Another significant milestone in the emergence of the whole of government agenda at the federal level was the release in 2004 of the Management Advisory Committee (MAC) report, Connecting Government: Whole of Government Responses to Australia’s Priority Challenges.  

In his foreword to the report, Dr Peter Shergold—at that time the Secretary of the Department of the Prime Minister and Cabinet—wrote that ‘whole of government is the public administration of the future.’

Today, unlike in Coombs time, there is a strongly embedded acceptance that the APS is to be responsive to the government of the day, and my impression, having returned to the APS after a couple of years spent elsewhere, is that the heads of APS agencies are far more collegiate and responsive to “whole of government” agendas than I had experienced for much of my earlier career, including the immediate pre-Shergold years.

Whole of government approaches are without question going to play a crucial role as we go forward.  But I don’t think they will or should be the sum total of our future.

We should also remember that there is a perfectly sound basis for our Australian system of government, in which separate portfolio agencies reflect an underlying accountability of individual Ministers to Parliament.  

This is not simply an accident of history.  It is also recognition that not everything the public service does requires a whole of government approach.  And it makes no sense to engage in costly or time-consuming cross-boundary work to deal with routine, straightforward issues.

Whole of government is increasingly important

However, having got it off my chest that the whole of government approach is not new, and is not the be-all and end-all of how governments operate, it nonetheless is true that “whole of government” has become increasingly important in recent years and this trend is unlikely to reverse any time soon.

There are a number of factors that are driving this.

One is a rise in community expectations of government.  Australians increasingly expect as the norm, convenient, 24 hour access to government services, commensurate with the level of service they expect, and receive, from the business sector. 

They are more inclined to interact with government through electronic channels and less tolerant of poor performance in service provision.

They are less tolerant of having to present themselves to multiple agencies to get help – the problems are “joined up” in them and they are looking for “joined up” responses from government.

Another factor is the recognition that many of the problems governments must deal with are multidimensional.

The increasingly complex challenges the contemporary APS is facing, such as climate change, lifestyle health issues and entrenched social and economic disadvantage require us to work across portfolio boundaries and in partnership with a range of organisations in order to devise and implement policies that tackle these complex policy issues effectively.

Of course, just as coordination across government is not new, neither is our generation the only one to face complex policy challenges.  If we look back over the last century, the APS, like the rest of the nation, has been faced with a few fairly significant challenges in the past, as well—two World Wars and the Great Depression, to name a few—which put the challenges we now face, difficult and wide-reaching as they are, into some sort of perspective.

Understanding complexity

While there have always been complex problems, what has changed over time is our understanding of complexity, the expectation that even the most complex issues should be addressable by government and the tools that are available to tackle these types of issues, such as networked government, advances in scientific thinking and analytical techniques which have made tractable a much wider range of issues, and advances in systems thinking—wherein to understand a problem, it is necessary to look at it within the context of a larger whole, and examine the linkages and interactions between the elements that comprise that larger whole.

We have come to recognise that, because of their changeability, interdependencies, multiple causes and internally conflicting goals, some problems cannot be successfully treated with traditional analytical approaches.

Successfully managing these complex policy problems requires a reassessment of some of the traditional ways of working and solving problems in the APS.  They challenge our governance structures, our skills base and our organisational capability.

Changing structures, skills and capability

At this point, it might be useful to briefly look back at how our current operational environment has come about.

Over the last thirty years or so, the APS has focused on improving its productivity and effectiveness through micro-economic reform, in particular devolving responsibility for financial and resource management from the centre to agency heads and reforms in performance measurement, reporting and transparency. 

Agency heads have been given the power to run their own organisations and align their staffing, administrative resources and assets to the objectives government has set for them.  They also face strengthened requirements to report results.

A risk with this approach has been that, along with the opportunities for flexibility and tailored solutions that greater autonomy provides, agencies might tend to become too inward looking—reinforcing the separation between portfolios and turning them into those so frequently maligned ‘silos’. 

Alongside the trend towards devolution, the late 1980s/early 1990s saw a push to separate service delivery and policy-making in the APS, and a cultural shift from reliance on direct service provision and prescriptive regulation to managing change, providing frameworks and incentives, and overseeing the protection of the public interest.

At the same time the APS’s policy advisory role became hotly contested with independent advice available to Ministers from their own staff, consultants, and various public policy research, advisory and special interest groups.

Evolving models of service delivery

And the trend to outsource, privatise and transfer activities to other sectors altered the role of many public servants from service provider to service purchasers and contract managers.

Changes to labour market assistance policies are a case in point.

The Commonwealth Employment Service (CES) was first established to assist in matching people with jobs to meet the challenge of Australia’s post-second world war reconstruction.  To sweepingly generalise; the service delivery model during the CES era tended to be process-driven with interventions that were too easily characterised as being of the ‘cookie-cutter’ or ‘one-size-fits all’ variety.

In the 1970s and through the 1980s, when unemployment rates and, especially, long term unemployment increased, Australia began to experiment with more tailored employment and training programs for disadvantaged groups, aimed at improving the employment prospects of the long term unemployed (or those at risk of becoming long term unemployed) and other disadvantaged jobseekers.

This led in the late 1990s to the creation of the Job Network, which involved contracting out the provision of government employment services. 

Delivery of job placement and tailored assistance services was offered to a range of private, community and government organisations, chosen through competitive tender. 

This was illustrative of a general trend away from a rigid, entitlement based service delivery model to more flexible, placed-based and personalised approaches.

Around the same time, the government brought together the service delivery arms of several departments to create Centrelink.  Centrelink allowed a range of services formerly delivered by different departments to be made available from a new network of integrated offices across the country. 

The simple but powerful idea was to make it easier for citizens to do business with the government, as opposed to pursing a mode of operations convenient for those delivering the service, rather than those receiving it.

This push for greater convenience and flexibility in service delivery, driven partly by a more educated and demanding citizenry, and powered by changing technologies, is still playing out and will only become more persuasive in the coming years.

The establishment of the commonwealth Department of Human Services is a further evolution of this concept.

Service delivery agencies like Centrelink were established in order to encourage innovation and creativity at the frontline and to raise the professional status of service delivery. 

While this approach has delivered considerable benefits, it has also come at some cost—particularly as a result of the detachment of high-level, strategic policy development from actual frontline experience and an understanding of on the-ground realities (though some might argue – with some justification – that those links were not always strong prior to the formation of Centrelink either).

Truly citizen-centric policy development is informed by frontline experience and their understanding of customer preferences and needs.  Effective innovation occurs when service design, delivery and policy formulation are well integrated.

It’s worth noting, here, that Centrelink has recently been taking steps to strengthen and rebuild connections between the frontline and policy-makers, for example it has been working closely with policy departments to deliver on the commitments of the Homelessness White Paper.

Indigenous-specific programs and services

Any discussion of trends in coordinated service delivery must inevitably touch on successive Australian and state governments’ efforts to address Indigenous disadvantage in this country. 

Speaking of the whole of government approach to the administration of Indigenous-specific programs and services, Dr Shergold said, when launching the 2004 MAC report ‘now comes the biggest test of whether the rhetoric of connectivity can be marshalled into effective action’.

I think we would all agree that on that score we still have a long way to go.  

Although the mainstreaming of Indigenous services provided Australian Government departments with the opportunity to develop more integrated solutions to entrenched Indigenous disadvantage, it also highlighted the challenges for departments, traditionally structured along a vertical responsibility and accountability basis, to develop stronger horizontal relationships between them to better deliver services to Indigenous communities.

The trick will be—and this applies to all our whole of government endeavours—to recreate synergies horizontally that once existed (even if imperfectly) within vertically integrated organisations.

New capabilities required

The growing need for collaboration and coordination has revealed a range of skill shortages and organisational capability gaps that has limited the responsiveness and effectiveness of the APS. 

We need to build stronger capability in relationship and risk management, collaboration, and cross-disciplinary work and to strengthen the linkages between policy development and service delivery.

We saw this again with the Northern Territory Intervention.  The early implementation phase of the intervention was hampered by a lack of cross-departmental communication and co-ordination skills.  It also revealed some institutional rigidity in deploying our human capital.

The cost of ongoing skills shortages, poor workforce planning or misaligned learning and leadership is high.  

The evidence for this can be found in the recent adverse findings by the Australian National Audit Office on the Green Loans Scheme and the Home Insulation Program.

ANAO identified the lack of a sufficient number of appropriately skilled staff as contributing to the implementation difficulties the scheme encountered and identified the need for a more deliberate and thoughtful approach to managing human capital in the APS.

While it is impossible to ignore such issues, and the frustrating lack of progress in delivering beneficial change for disadvantaged Indigenous communities, there are also some positive developments on the whole of government front.

The Council of Australian Governments (COAG) has continued to be instrumental in addressing new and emerging challenges, including implementing responses to the global financial crisis.  

Significant progress has made through COAG on many of the priorities agreed in December 2007, which included health and ageing; the productivity agenda, including education, skills, training and early childhood, climate change and water; infrastructure; business regulation and competition; housing and Indigenous reform.

Over the past few years, responses to the agency survey conducted for the Australian Public Service Commission’s annual State of the Service Report have indicated a strong recognition across the APS of the importance of connectivity and collaborative approaches in meeting future challenges. 

Survey responses have highlighted a range of initiatives that are underway at the agency level to aid information sharing and improve collaboration.

Taking stock—the MAC best practice approach

To get a broad indication of how we are travelling in relation to the whole of government agenda, it may help to briefly revisit the best practice approach set out in the MAC report.  That approach consisted of four elements:

The first was culture and philosophy, which included:

• incorporating whole of government values into portfolio cultures
• information sharing and cooperative knowledge management, and
• effective alignment of top-down policies with bottom-up issues.

The second was new ways of working, which included:

• shared leadership
• a focus on expertise
• flexible team processes and outcomes, and
• cooperative resourcing

The third element was new accountabilities and incentives, which included:

• shared outcomes and reporting
• flexibilities around service outcomes
• performance measures engaging collegiate behaviour, and
• rewards and recognition for horizontal management

And the fourth element was new ways of developing policies, designing programs and delivering services, which included:

• a collegiate approach
• a focus on whole of government outcomes
• consultation and engagement with clients and users, and
• a shared customer interface.

Running down that list, it seems to me that we have made at least some advances against all four elements and have mapped out strategies for further improvement in relation to each of them.

Which brings me back to the reform agenda outlined in Ahead of the Game: Blueprint for the Reform of Australian Government Administration, in which the way ahead is well signposted.

The way forward—APS Reform Blueprint

The Advisory Group that authored the Blueprint—of which I was a member—formulated its recommendations against the background of a number of significant strategic human capital challenges. 

They are mostly well documented and of course they are not limited to the public sector. Briefly, they include:

• Demographic challenges: The national (and the APS) workforce is ageing, which poses some interesting succession and other issues.  And the workforce is becoming more discriminating in its choice of employers and more mobile, including internationally in some important segments of the labour market.
• Economic challenges: There are growing pressures on government budgets and an increasing focus on public sector restraint and efficiency.  And the competition for skills of relatively greater importance to the contemporary APS is becoming more intense as the structure of the Australian economy overall shifts towards more knowledge and relationship intensive activities.
• The challenge of heightened expectations: The expectations of government and community are becoming more demanding of the public sector.  Technology is an important driver of this change, as are rising incomes and rising service standards in the private sector.  Moreover, there is a growing expectation that almost every problem can be solved, no matter how complex or intractable the problem may have seemed even in the relatively recent past.

As I touched on earlier, some of these expectations have led the APS to adopt a wider range of roles over time, sometimes taking us into areas that have traditionally been the preserve of the States. 

Some of these roles are managed through relationships with non government providers, many in the third sector, and others require APS employees to exercise judgement and develop interventions tailored to the needs of particular localities or individuals.

Taken together these evolving challenges have required the APS to strengthen a range of skills sets and broaden the capability of its workforce.

In recognition of this, the Blueprint sets out clear directions for the renewal of the central role of the Australian Public Service Commission to drive change and provide a coordinated and strategic approach to workforce planning and skills development.

A culture of collaboration

To drive change, leadership is always the key.

The Blueprint accordingly proposes that Secretaries, the Australian Public Service Commissioner and an executive leadership forum assume responsibility for the short, medium and long-term stewardship of the whole public service, with a brief to strengthen its objectives, identity and practice. 

This whole of service stewardship function will help to cement an APS culture that supports, models, understands and aspires to whole of government solutions when they are necessary.

And to pervasively embed those collaborative instincts in APS culture, we really do need to promote a shift in thinking. 

State of the Service employee survey responses indicate that less than 40 per cent of the Senior Executive Service definitely see themselves as part of an APS -wide leadership cadre rather than as leaders only of their agency.

While we can’t overlook the fact that most are under considerable pressure to deliver on agency-specific objectives, we nevertheless need to make sure our SES are also inclined, and encouraged, to turn their attention outwards—to look for connections and linkages that will support better outcomes for the community as a whole.

Linking strategic policy and delivery

A major strand of the reform Blueprint is strengthening the capacity of the APS to provide strategic, big picture policy and delivery advice that addresses the most difficult policy challenges of the day.  Two new leadership groups established under the Blueprint—the Secretaries Board and APS 200—are responsible for driving the push for enhanced strategic policy and delivery capability.

This will involve establishing cross-agency strategic policy project teams and a Strategic Policy Network to aid development of strategic policy capability across the APS.  The Blueprint has also charged each Department with responsibility for strengthening its strategic policy and delivery capability.

I believe APS agencies are acutely aware of the need to do this and we’ve already seen that many are creating or re-aligning functional groups within their agency to that end. 

This is positive, but through the State of the Service Report and other forums we are also emphasising to agencies that they need to identify the skills and relationships that people working within these areas need, and to plan for and develop future capability.

Incidentally let me place a marker here in your memory banks – our examination of “capability” issues needs to move beyond our traditional occupation with skill sets to embrace the realisation that capability relies on an intelligent combination of people, processes and systems that come together to optimise an organisation’s performance.

Whole of government service delivery strategy

In order to deliver services to citizens that meet their expectations for simplicity and convenience, the Secretaries Board is working to put together a whole of government service delivery strategy. 

The strategy will be developed through a cross-departmental project team that will systematically examine Australian Government service delivery, taking into account existing reviews, reports and research, as well as consulting with the public, employees and other relevant stakeholders. 

The Commission has also been tasked to examine the feasibility of conducting a citizen survey to improve the quality of service delivery by the public sector.  

Experience abroad, reported in the Blueprint, is that such a survey offers substantial opportunities to improve organisational performance.  

Among the potential benefits are identifying drivers of citizen satisfaction with government services and providing opportunities for agencies to develop whole of government approaches for dealing with citizens. 

The results of the survey – if the government decides to proceed with it - could feed into developing the strategy.

The focus for the strategy will be citizens’ circumstances or life events—which will be agreed on and used right across the APS.  

This analysis will assist agencies to work more collaboratively in the design and implementation of services across government; and to align their existing service delivery programs and processes within an overarching service delivery strategy.

For example there are clear gains if agencies can re-use and share data (consistent with privacy and secrecy laws).

Moreover, citizens may find the option of common registration processes across government offers the convenience of a single login (potentially via the Australian Government Online Service Point) and access to customer preferred delivery channels based on the convenience of the citizen, rather than the agency providing the service.

Like the whole of government agenda, the push for seamless service delivery is a longstanding trend, and one that we will be pursuing for many years yet.  However, the momentum within government and the acceptability within the community is building to drive this forward.

Building new capabilities

More and more the APS requires skills in high level policy analysis, managing relationships, articulating and addressing risk, and program implementation.  These complex skills draw on domains of formal knowledge but most importantly also require the APS to maintain human capital systems that can identify, develop and manage the skill sets and talent of APS employees, and relate them to the current and future ‘business’ of the APS.

A human capital approach

In particular, the Blueprint recommended that the APS should take steps to manage its workforce more systematically.  The phrase ‘human capital’ is used in the Blueprint to signal a distinct shift in the approach the APS should take to build and sustain workforce capability—an approach that is not only more systematic, but also more holistic and more future oriented.

The Blueprint contains a number of recommendations designed to build an evidence base to support improved performance across the APS.  

The devolved nature of workforce management in the APS has led to considerable duplication and inconsistency in data gathering and analysis within agencies.  For example, while some larger agencies maintain a sophisticated workforce data collection and analysis capability that is used to drive internal performance many other agencies lack the resources to access to this type of information and the expertise to exploit it.

The Commission is well-positioned to draw together the existing data and identify new sources of workforce information that can be used to improve the quality of workforce decision-making across the APS.

For example, the Coombs Commission presciently noted, more than thirty years ago, that there was a need to ‘look for more serious attempts to evaluate training programs than have so far been undertaken’ and that ‘much of the training conducted is not linked in any way to the objectives of the organisation’.

While we have made progress over time, the Blueprint acknowledges that we continue to grapple with our learning and development planning and evaluation and ensuring that these are linked directly to the future requirements of the APS.

While agencies have invested in learning and development, overall they have struggled to demonstrate that they use resources to maximum effect.  

Managing talent and encouraging collegiality

The Advisory Group observed in the Blueprint that: ‘strong organisations nurture their talent and encourage workforce collegiality.  

In the public sector, collegiality should extend across agency borders to promote a unified APS culture. 

To ensure it has the capability to provide high quality support to government, the APS must attract high performing individuals from within and outside the public sector.’

We also need to invest in learning and development and provide pathways for high performing employees to grow and develop, including through placements in different agencies (another “whole of government” challenge) and through secondments to the private and not-for-profit sectors.

Attracting diverse talent will provide the APS with a wider range of experiences and skill sets.  Diversity is going to be increasingly important as the population ages and the labour market tightens.

Maintaining organisational capability

To ensure APS agencies have sufficient agility, capability and effectiveness to successfully address complex issues that cross organisational boundaries, the Blueprint proposes a program of periodic external reviews of agencies’ institutional capabilities covering strategy, workforce capability, leadership, delivery and organisational effectiveness.

The Blueprint proposal to conduct Capability Reviews draws directly on the UK Capability Review Program.  Work is in hand to trial capability reviews in the APS and we have the advantage of being able to leverage the experiences and lessons learned from the UK experience.

Tellingly, when in 2009 the UK National Audit Office (NAO) conducted a review of the Capability Review program it found the review process had created a shared interest in capability building across departments.  This included the identification of common challenges that required a collaborative response.  

Shared accountability

A perennial issue for whole of government arrangements is the rather vexed question of accountability.  The Commission has released several publications in recent years in which we’ve examined the challenges involved and suggested that something needs to be done.

In Delivering Performance and Accountability (2009), for example, we noted that in terms of accountability ‘various countries have developed their own responses…and there remains something makeshift and provisional about whole of government arrangements in most countries.

Nobody has yet found a means, or perhaps sufficient reason, to move away from a fundamentally vertical, departmental system of government.  For most government activities, the concentration of functional expertise within separate agencies or portfolios offers many advantages that outweigh the occasional problems of coordination.

I am pleased therefore, that the Blueprint has taken the step of proposing a new outcomes structure that will establish shared responsibility for outcomes across portfolios, creating shared agency accountability in critical interrelated areas, such as Indigenous affairs.

The Secretaries Board will work with Finance to propose a set of shared outcomes across portfolios, for Government consideration, such as outcomes for Indigenous Australians, homelessness and national security.

Agencies will need to work together to agree on and clarify responsibilities.  Existing agency output structures will be retained initially and mapped to the new shared outcomes, with further changes to the outcome structures to be made over time.

Secretaries will be accountable for achieving shared outcomes and will report against them in the Budget process and in their own performance assessment.

Conclusion

I have singled out a number of measures in the reform Blueprint that will support a more cohesive and capable APS, but I have by no means covered everything.  The Blueprint is a comprehensive suite of reforms that has the potential to deliver a significant return on investment to the Government in terms of greater unity and connectivity, improved outcomes, greater efficiencies and reduced costs.

It will add significant impetus to the whole of government agenda, but there is much that remains to be done.  As with many long term trends, whole of government is a work in progress—it is ‘showing the hourglass’, as they say in the techno-sphere.

In conclusion, may I say that the stage is now set for the APS to develop a more strategic, comprehensive and sophisticated approach to building the skills and organisational capability needed to support genuinely citizen-centric (even “joined up”) approaches to policy development, service delivery and implementation.  The challenge both for the Australian Public Service Commission and wider APS is both considerable and exhilarating.

Thank you.