The federal bureaucracy has undergone “a watershed year” according to the Australian Public Service Commission’s annual State of the Service report for 2013-2014 amid once-in-a generation changes that have hard pruned numbers and recast significant elements of the machinery of government.

In a frank and sometimes critical overview of the wider public service, the APSC  has delivered a picture of an organisation challenged by the changes mandated by policymakers, rising public expectations and the relentless march of technology.

It’s picture that implies there’s plenty more upheaval just around the corner.

“The first full year of a new government brought significant changes in priorities, programmes and APS organisational structures. In 2013–14, APS headcount declined by 7,925 including through arrangements to maximise redeployments in preference to new hires,” the State of the Service report said.

“The environment in which the APS is operating is still changing rapidly.”

Noting the bureaucracy is “well placed to respond” to such demands, a recurrent theme in the document is that public servants will have to learn to embrace and create change — including bringing innovation service delivery, stakeholder and the public engagement and responses to policy.

In many ways, State of the Service reveals 2013-2014 was the year that the same wave of technological disruption — which has already hit the retail, finance and communications sectors — finally caught up with the public service.

The report firmly cautions changing technology “has the potential to disrupt not just private sector business models but also those of the public sector.”

That disruption could come in the form of the government simply getting out of the way in favour of “emerging competition from alternative providers of advice to and services provided on behalf of government.”

It not only warns of “rising citizen expectations for more and better quality support from government and the public service” but of an expectation that the public can “influence” what they receive.

This means the ability “to be heard and responded to with more personalised services and programmes delivered more conveniently, possibly involving a degree of co-production if not co-design,” the report says.

One logical interpretation of that assessment is customers and clients interacting with the federal bureaucracy have rapidly coming to expect the same level of convenience, personal recognition and contextualised offers that online services have come to deliver, even if the latter do so by hoovering-up petabytes of their customers’ personal data.

The efficiencies lowered costs enabled by the so-called digital economy also appear to be exerting substantial pressure, not least because of demands to reduce spending.

Put more simply, as the Abbott government prosecutes its stated vision of public sector downsizing, a key part of the bureaucracy’s response to ease the pain and preserve its role is boosting productivity through better use of technology which cuts administrative costs, automates manually complex tasks, and allows public servants to apply far more of their efforts to realising policy outcomes.

“Greater personalisation of services needs to be approached in ways that preserve trust in the capacity of government to deal with individuals and groups equitably and at low cost,” the State of the Service report says.

How the government acquires the systems and tools that it needs to discharge its obligations is squarely in the crosshairs.

One potentially contentious observation in the report is on the effectiveness of devolved versus centralised procurement models.

The State of the Service report appears to suggest a leaning towards a more consolidated model that has sometimes been criticised for impeding innovation and competition, especially from free market and conservative critics.

“Changes in technology and market dynamics have invalidated the economic assumptions upon which some devolved procurement has been based,” the report says, adding that “the opportunities to capture economies of scale are growing.”

Citing Canada as an example, it notes the government there is in the process “of moving to a single email system based on a single platform with consolidated servers providing centralised email support to all Canadian Government agencies.

“Some 100 separate email systems are being consolidated into a centrally provided system by the end of 2014–15, with substantial savings expected.”

It also notes that the UK is moving towards greater use of shared and common services in its government, a trend which in Australia has had a decidedly chequered history in states like Western Australia and South Australia.

Even so, the APS’ plethora of enterprise and back office systems that largely perform similar function – which have for decades frustrated ministers and departmental heads alike – are clearly headed for rationalisation, albeit with some caution.

“Work is in hand in the APS to examine the scope for economies through consolidating enterprise resource management systems (for example, human resources, payroll and financial management information).

“This work is prospective, though progress will need to be planned carefully to minimise transitional costs,” the State of the Service report says.

It also cautions that it won’t all be plain sailing.

“The uptake of some options, however, may be hampered by now deep enculturation of agency autonomy and the plethora of non-standard systems, policies, practices and entitlements permeating the APS today.

“The latter may impose speed limits on the transition to sensible longer-term arrangements.”

Productivity and Performance Management

Getting the most out of public servants during their working hours is also a strong theme, especially the thorny issue of performance management. Put simply, the APSC clearly believes that things are a lot harder than they need to be when it comes to managing staff.

“An examination of agency enterprise agreements, for example, highlighted that many agencies have, over time, surrounded the performance management process with excessive procedural and other encumbrances,” the State of the Service report says.

“The need to afford an employee procedural fairness is deeply enshrined in administrative law and APS practice. This does not require, however, the adoption of interminable or excessively bureaucratic processes.”

Abolishing interminable processes, and the way they sap productivity, are of course part and parcel of the Abbott government’s attempt to force hardline changes on the bureaucracy in the present round of negotiations on enterprise bargaining.

While those policy tactics (which the APSC must enforce) have so far produced little more than the potent threat of industrial action, an embarrassing Prime Ministerial backdown over the removal of entitlements for Defence Personnel and a possible legislative roadblock in the Senate, there is still clearly a long way to go in terms of an agreed definition of public sector productivity.

In the present bargaining context, almost all productivity-related trade-offs brokered by the government have in fact been based on savings or cost cuts, such as increased working hours, rather than increased outputs.

Notably, the State of the Service report candidly acknowledges there’s a long way to go when it comes to benchmarking productivity.

“Finding useful productivity measures in the public sector…has proved problematic,” the report says.

“The 2014 State of the Service Agency Survey (agency survey) asked agencies whether they had a framework in place to measure agency productivity. Thirty-seven per cent of agencies (covering 35 per cent of the workforce) reported they had a framework for measuring productivity for all or part of their agency, 31 per cent of agencies (covering 31 per cent of the workforce) indicated that a framework was being developed, and 32 per cent of agencies (covering 33 per cent of the workforce) reported they did not have a framework in place.”

In other words, two thirds of the APS still doesn’t have a formal framework in place to measure how productive their organisations are.

Absenteeism reaches maturity.

Perhaps the most telling hallmark of the changing demographic profile of the APS is the increasing number of ‘unscheduled’ absences that were chalked up by public servants accessing carer’s leave.

While being able to take time off to care for sick children has long been seen as a benefit by APS employees, the fact remains that as public servants get older, so too do their parents.

“Employee census data shows that caring for parents is an increasing responsibility faced by APS employees, with almost as many employees reporting caring for their parents (7 per cent) as caring for children under 5 years of age (8 per cent).

The report also frankly acknowledges that managing carer’s leave may not be as easy as just cracking down on sick days (which often go up as employees are exiting the APS).

“Importantly, data from the employee census shows while carer’s leave is significantly linked with employee engagement, the relationship is weaker than that with sick-leave use, reinforcing the idea that carer’s leave is more likely to be determined by factors other than motivation to attend work and may be less likely to be influenced by management action,” the report observed.

The State of the Service report said that unscheduled absence has been rising since rates were first reported in 2006–07 when the median rate across APS agencies was 9.4 days.

In 2013–14, “the median rate of unscheduled absence across all APS agencies was 12.0 days per year, an increase of 0.4 days per employee from 2012–13.”

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