3.1
The Defence Annual Report 2015–16 highlighted successes in implementing the First Principles Review (FPR); moving to a shared service delivery model for asset accounting; and a maturing data assurance network to swiftly identify and resolve asset management issues as they occur.
First Principles Review
3.2
In August 2014, the then Minister for Defence appointed a team to undertake the FPR of Defence. Led by Mr David Peever, the review team comprised of Professor Robert Hill, Professor Peter Leahy, Mr Jim McDowell and Mr Lindsay Tanner. The membership of the review team brought together a range of perspectives and a wealth of experience and expertise that were also supported by Ms Roxanne Kelley, Major General Paul Symon and their secretariat as well as the Boston Consulting Group.
3.3
The FPR was tasked with ensuring that Defence is fit for purpose and is able to deliver against its strategy with the minimum resources necessary. Using a structured framework, the Review conducted an end-to-end holistic review based on the outcomes required of Defence and founded on the first principles agreed by the review team.
3.4
A key finding of the FPR was:
Waste, inefficiency and rework are palpable. Defence is suffering from a proliferation of structures, processes and systems with unclear accountabilities. These in turn cause institutionalised waste, delayed decisions, flawed execution, duplication, a change-resistant bureaucracy, over-escalation of issues for decision and low engagement levels amongst employees….Defence was faced with delivering a significant capability modernisation program against a backdrop of strategic uncertainty including, but not limited to: rapid technological change; budget uncertainty; substantial economic growth in our region; and increasing demand for military responses to various regional and expeditionary crises.
3.5
The FPR reported that a holistic, fully integrated One Defence system is essential if Defence is to deliver on its mission in the most effective and efficient way. In response to the Report, the Minister for Defence, Senator the Hon Marise Payne (Minister), in a Statement on the Implementation of the First Principles Review of Defence 22 June 2017, advised that four key features were being implemented to create One Defence. They are:
A stronger more strategic centre able to provide clear direction, contestability of decision-making, along with enhanced organisational control of resources and monitoring of organisational performance;
An end to end approach for capability development with Capability Managers assigned clear authority and accountability;
Enablers that are integrated and customer-centric; and
A planned, professional workforce with a strong performance management culture at its core.
3.6
The Minister also advised that:
The FPR has helped create a Defence organisation that is far more strategic, far more efficient, and far more effective…There have been 35 major reviews of Defence since the early 1970s. However because of the frequency of those reviews many of the recommendations were never able to be implemented before the next review was initiated and Defence organisation structure at the time was resulting in processes that were complicated, slow and inefficient.
3.7
The Committee considered the status of the FPR and focused on:
Defence’s monitoring achievement of FPR recommendations;
new process and responsibilities;
coordination and de-confliction of enterprise reform; and
institutionalising change.
Monitoring achievement
3.8
A summary of progress made against the recommendations of the FPR team as reported to the Senate Standing Committee on Foreign Affairs, Defence and Trade (Legislation), 10 May 17 is at Enclosure 2.
3.9
The Committee maintained a watching brief on the progress of FPR recommendation implementation and whether challenges had been encountered in implementing the recommendations. The Department of Defence (Department) advised on the progress to date:
The Secretary of Defence established an Implementation Committee consisting of himself as Chair, Chief of the Defence Force, Associate Secretary, Vice Chief of the Defence Force, Deputy Secretary Strategic Policy and Intelligence, Chief Finance Officer, Deputy Secretary People and Deputy Secretary Capability Acquisition and Sustainment. The role of the Implementation Committee is to drive the implementation and make major implementation decisions, including the closure of recommendations.
3.10
The Department also advised that the implementation of the FPR is managed through five work streams:
Strong strategic centre (Deputy Secretary Strategic Policy and Intelligence);
Capability (Vice Chief of the Defence Force);
Enablers (Associate Secretary);
Behaviours (Associate Secretary); and
Work force (Associate Secretary).
3.11
Each work stream is owned by a senior leader within the Department (in brackets above).
3.12
The Department advised in relation to this new status:
An Implementation Office has been established to monitor and report on implementation progress. The Implementation Office coordinated the development of the detailed implementation plan and is responsible for ensuring implementation occurs in alignment with the intent of the FPR. The Implementation Office is also responsible for governance of the implementation program, including reporting. A report is tabled with the Implementation Committee each week which details progress against the implementation plan.
Progress on implementation of the Review has been steady since it commenced on 1 July 2015, with 63 of the 75 recommendations complete as at 15 May 2017. As agreed on 19 October 2016, Defence provides the [Senate Foreign Affairs, Defence and Trade Legislation] Committee with a report two weeks prior to each estimates hearing on progress made to date on the implementation of the 75 recommendations from the FPR.
Recommendation 6.3 of the FPR called for the creation of an Oversight Board. The membership comprises the members of the FPR team, Mr David Peever as Chair, the Hon Robert Hill, Mr Lindsay Tanner, Professor Peter Leahy, Mr Jim McDowell and Ms Erica Smyth. The Oversight Board’s primary function is to provide advice to the Minister on the progress Defence is making in implementation of the FPR. The Oversight Board receives the same papers and reporting that is provided to the Implementation Committee.
Committee Comment
3.13
The Committee observed that the Department of Defence has worked hard to implement structures and processes to measure, track and report on the achievement of reform. The Committee however notes that outside the Department, there is limited documentation or reporting that can be used by Parliament or other interested parties to scrutinise changes in effectiveness or efficiency resultant from the FPR related change. The Committee intends to require that the Department through the new methodology, review the Department of Defence Annual Report and publish data that enables external organisations to build confidence in the good work the Department continues to progress to reform.
3.14
The Committee recommends that the Department of Defence develop a transparent reporting mechanism that demonstrates changes in effectiveness or efficiency resultant from the First Principles Review related change for consideration by the Defence Sub-Committee of the Joint Standing Committee on Foreign Affairs, Defence and Trade by 31 March 2018.
Process and responsibilities
3.15
The Committee inquired into how the Department of Defence had improved decision making through the implementation of the FPR. The Department advised:
As per recommendation 1.13 of the FPR there are three Committees within the strategic centre of Defence. The Defence Committee is the primary decision-making committee of Defence and the heart of the strategic centre, with two supporting committees – the Enterprise Business Committee and the Investment Committee.
The Enterprise Business Committee is responsible for ensuring effective running of the Defence organisation, for example, planning, performance monitoring and reporting, enterprise risk management, information management and service delivery reform.
The Investment Committee is responsible for undertaking regular holistic reviews of the investment portfolios for capability, estate and information and communication technology, taking into account force requirements, all necessary enabling functions and full-life costs. The Investment Committee also reviews project approvals to ensure they are consistent with strategic guidance and affordable within approved funding envelopes. The Department of Finance and Department of the Prime Minister and Cabinet have representatives on the Investment Committee.
Committee Comment
3.16
The Committee acknowledges that the Department’s streamlining of executive committees has contributed to greater coordination and strategic messaging from ADFHQ. In 2018, the Committee will review the devolution of the roles and authorities now informing ADFHQ to ensure the cultures sought through the FPR are pervasive across the Department.
Strategic Centre
3.17
The Department of Defence advised the Committee they had strengthened accountability through legislative, structural and organisational changes to create a stronger strategic centre to support more effective and efficient enterprise-level decision-making.
3.18
Roles and responsibilities at the most senior levels of the Department have been clarified and strengthened by the following measures:
Legislative changes were made to the Defence Act 1903 to formally identify the role of the Chief of the Defence Force and Vice Chief of the Defence Force;
The individual and joint responsibilities of the Secretary and the Chief of the Defence Force were clearly described in a ministerial joint directive;
The role of Service Chiefs as capability managers was strengthened, clarifying their responsibility for identifying, developing and delivering Defence’s capability needs; and
Role charters for all members of the senior leadership group have been established, setting out individual and shared accountability, decision rights and agreed leadership behaviours.
3.19
Clarification of roles, responsibilities and decision making authorities has resulted in the number of committees chaired by senior members of the Department being reduced from 72 to 35, ensuring the Department’s executive spends less time meeting, and more time doing.
Committee Comment
3.20
The formation of the Australian Defence Force Headquarters (ADFHQ) has provided the structure to institutionalise the objectives sought through a strong strategic centre, including improving the quality of advice and decision making in the Department.
3.21
To mitigate any single service approaches to ADF capabilities, the Vice Chief of the Defence Force (VCDF) has been appointed as the Joint Force Authority, and a new Chief of Joint Capabilities was established in July 2017 to improve the management and oversight of key enabling capabilities.
3.22
The Committee notes that the ADFHQ establishes a strategy-led and integrated approach to the development of advice and management of the Department. The effectiveness of these new arrangements will be further examined in 2018.
Capability Life Cycle
3.23
The Capability Life Cycle links capability concepts all the way to their delivery and ultimately their disposal. By considering a capability in its entirety, the Department has simplified the process and reduced the time taken for capability decision making. Through the Investment Committee; the Department aligns strategic direction, manages contestability and maintains capability manager accountability.
3.24
The FPR recommendation to bring the former Defence Materiel Organisation back into the Department, now the Capability Acquisition and Sustainment Group (CASG), was central to the new Capability Life Cycle. This one change eliminated the administrative burden of having to manually process thousands of financial transactions each year.
3.25
The Committee sought specific examples of changes the Department of Defence has made to the procurement manual and commercial and technical training. The Department advised:
Commercial Policy Framework will include a new simplified Defence Procurement Policy Manual as the top tier document, supported by two new documents to provide this proportional process guidance; a Complex Procurement Guide and a Simple Procurement Process. The number of requirements in the revised Defence Procurement Policy Manual has been reduced from approximately 290 mandatory policy requirements to 53 new policy directives.
These top level guides are supported by a revised and simplified set of procurement handbooks, web guidance, tools and templates. These continue to be developed and updated and are progressively released as part of the Commercial Reform program.
3.26
The VCDF advised the Committee that the Department was working with Government to improve how investment decisions are categorised, with the intent to move towards a risk based methodology.
3.27
On 22 June 2017, the Minister for Defence in a statement on the implementation of the FPR advised:
This approach enables the tailoring of each project by the accountable Capability Manager to ensure that they are delivered with the optimum risk balance between capability, cost and schedule. Industry best practice tools and techniques are used to execute projects in a way that strikes the optimum balance between performance, time and cost. Importantly, industry is now involved much earlier in the process, recognising the key role it plays as a partner in the delivery of Defence capability.
3.28
The Department introduced Smart Buyer as part of CLC, for all projects in Capability Acquisition and Sustainment Group. The Chief Information Officer Group and Estate and Infrastructure Groups are now piloting the program. Smart Buyer through assessing key project risks provides the primary means of tailoring the way in which projects pass through the new Capability Life Cycle (CLC). The Smart Buyer decision framework is shown in Figure 3.1.
3.29
The Committee inquired into the implementation, scalability and performance measures being used to assess the effectiveness of Smart Buyer. The Department advised:
Smart Buyer is a fundamental part of the capability life cycle, and it has been implemented for new projects going through that life cycle. It is up and running for new projects going to the investment committee.
It is fair to say they are probably more in a development phase. We have developed the tailoring aspect in relation to tailoring execution strategies based on risk. The Smart Buyer framework is underpinned by the establishment and identification of risks as they attribute to acquisition and sustainment. We look across the whole life cycle at the beginning of a project, we take that risk assessment and then tailor an execution strategy. In many instances where there are simple procurements required we apply a simple approach to that execution strategy. That includes the execution of acquisition and sustainment and the way we project manage that. That information is provided through to the investment committee, which then decides how to progress.
3.30
The Minister for Defence in a statement on the implementation of the FPR also advised that prior to the FPR the average submission to government totalled 70 pages, took 16 weeks to move through the cabinet preparation process and took an average of 46 months – that is almost four years – to move from first pass initiation to second pass approval. Further, the implementation of the FPR recommendations has resulted in the average investment submission being presented to Government reducing to less than 20 pages, taking 6 weeks for the cabinet preparation process and in some instances taking less than 12 months to progress from first to second pass. The Government approved 63 Defence submissions in financial year 2016-17, close to double the previous highest number ever.
3.31
The Department of Defence is expected to present approximately 80 submissions for Government consideration in financial year 2017-18. The achievement of this goal is likely to result in expenditure in line with the Integrated Investment Program (IIP) allocation.
Committee Comment
3.32
The Committee notes the Department of Defence’s response stating the Smart Buyer initiative is under development. The Committee will review implementation progress of this initiative in 2018.
3.33
The task of preparing 80 or more investment submissions will be challenging and will test the Department’s new methodology to assess capability and project risk, to engage with industry and the effectiveness of the new Defence Investment Committee processes. The Committee acknowledges the current resolve within the Department to deliver on this commitment and will review progress in 2018.
3.34
The Committee notes that success in this regard will go some way to addressing commentator’s concerns the Department of Defence will under-spend against PBS projections.
Industry as a fundamental input to capability
3.35
The Committee inquired into the implementation of the Department of Defence considering Industry a Fundamental Input to Capability (FIC). The Department advised:
There are a couple of really significant pillars to that, and first of all is in that integrated business planning. We are working extremely closely with industry but also with our partners in the VCDF group and CASG to make sure that those business processes are being changed. For example, the Vice Chief of Defence Force design process now embeds industry and innovation right through that cycle of identifying gaps and then working its way through a forced design cycle that is quite transformational to have that explicit recognition.
Secondly, through the capability life cycle, industry is recognised as a FIC and something that must be looked at as a discrete, specific and incredibly important part of that. It is important to understand that there is not one initiative that would transform that; there is a bunch of things that we need to do to make sure that that is a reality and that is a whole ecosystem around engaging industry very early, so, as you know, we have got some fundamental enablers that allow us to do that. We have now set up the Centre for Defence Industry Capability, which was launched on 5 December 2016, which has industry sitting at the table through that advisory board. So we have got a co-chair situation, as you might remember, with a deputy secretary of CASG, Mr Paul Johnson and a very fine group of people driving industry and looking over the formal governance of the programs. So they are also driving and providing advice right through into Defence and into that capability life cycle.
The engagement mechanisms to allow that information exchange are very important, so we have environmental working groups where a lot of information is passed.
Committee Comment
3.36
The Department’s advice on the progress of implementing Industry as a fundamental input to capability accords with evidence received by the Committee from Industry representatives who observed increasing and positive engagement from the Department and regular requests for Industry advice.
3.37
The Committee affords the Department the strongest support for incorporating Industry as a FIC and acknowledges the early stage in the initiative’s implementation. The Committee has observed a renewed interest from industry to engage on Defence matters, in part, because of this initiative.
3.38
The Committee recognises an opportunity for the Department to further improve communication and trust with Industry by inviting a prominent Defence Industry leader to assist the Investment Committee during Gate Zero deliberations where approach to market decisions can be demonstrably varied through intimate knowledge of, or perception of Australian Industry’s capacity to deliver.
3.39
The Committee recommends the Department of Defence consider leveraging private sector expertise during Investment Committee Gate Zero deliberations; where the addition of an Industry expert may increase public confidence in approach to market decisions.
Transparency
3.40
To be transparent is to be open, frank or candid, open to public scrutiny and easily seen through or understood. Dr Mark Thomson in his submission to the inquiry highlighted the need for greater transparency in the Department of Defence reporting. Dr Thomson advice is representative of concerns raised with the Committee throughout 2017.
3.41
Dr Thomson advised the Committee:
The fullest possible disclosure of Defence performance consistent with security considerations is firmly in the public interest. Without adequate information, the parliament cannot fulfil its oversight role and the taxpayer cannot be assured that Defence is delivering value for money or even that Australia's defence arrangements are adequate to the task.
3.42
Similarly, the Committee sought to understand the concerns raised by Dr Andrew Davies regarding the quality and quantity of defence planning information that is publicly available. Dr Davies said:
The current level of data makes it hard for Australian Strategic Policy Institute to provide independent advice to the government regarding defence acquisitions and their performance.
3.43
Whilst inquiring into the requisite level of public disclosure sought by academics and other interested parties, Dr Mark Thomson added:
It is appropriate to disclose what the broad capability goal is: the ability to achieve some military effect in a certain environment and to disclose what range of physical capabilities is being considered that might be suitable to perform that task.
3.44
While seeking greater transparency on Defence investment, Dr Thomson cautioned against settling too early on a particular capability solution which might then not turn out to be the best outcome. Dr Thomson also acknowledged the Defence Annual Report does not stand alone as it is supplemented by, among other things, the annual major projects report from the Australian National Audit Office, the annual women in the ADF report and the annual report of the Sexual Misconduct Prevention and Response Office.
In each case, valuable additional information on Defence performance has been made available.
Committee Comment
3.45
The Committee notes the requirement for greater transparency and streamlined reporting. To address this, the Committee will seek to work with the Department of Defence to streamline reporting to the Parliament on the elements that contribute to either the delivery of capability or appropriate independent Parliamentary oversight.
3.46
That the Department of Defence work with the Defence Sub-Committee of the Joint Standing Committee on Foreign Affairs, Defence and Trade to harmonise and streamline reporting matrices to the Parliament to allow for independent Parliamentary oversight.
Strategic communication and reporting
3.47
The Committee has concerns that the method and structure of performance reporting to the Parliament is not synchronised to the Department of Defence’s internal business cycle, not synchronised and not based on transparent matrices. Dr Mark Thomson advised the Committee there is more that can be done to make the Department's performance intelligible to the nation. Dr Thomson highlighted three specific areas for improvement:
Improve the consistency between the Defence portfolio budget statements and the Defence annual report;
Reporting of Defence expenditure on major projects in real as opposed to out-turn dollars to ensure the true economic cost of procurements are transparent; and
Improved reporting on the cost and status of ADF capability.
3.48
Dr Thomson also highlights academia’s frustration with current reporting through analysis of Australia’s acquisition of the F-35, stating:
The [acquisition] plan's total cost is a single, imprecise aggregated figure. As a result, I will not be able to tell you whether our acquisition processes are on track or if the planned costs are being realised in practice.
3.49
Notwithstanding frustrations with current levels of reporting, Dr Thomson believes the Department has made progress in tracking the costs and the status of military capabilities, stating that:
At this point in time the Department of Defence probably has a better grasp on its in-year activities and its future year plans than it has at any point in my professional experience. That is to be commended; great progress has been made…and, at this point in time, things are being managed in Defence better than they ever have been, but Defence faces a whole series of very substantial challenges in implementing the 2016 white paper over the next couple of decades… So scrutiny is still required.
3.50
Dr Thomson further reiterated that:
It is disappointing, therefore, that the improved internal understanding has been accompanied by a drastic reduction in public disclosure.
3.51
Dr Thomson also highlighted to the Committee the benefits of the Department reporting on the capability impacts of Government direction. In highlighting the benefits of this additional reporting, Dr Thomson also acknowledged:
It would be worth doing, but you would not want to either impose too much impost on Defence to dot the i's and cross the t's to the third decimal place on it or think that there was great science behind it, because money is fungible.
3.52
The Department advised in response:
I do not think the outside world does appreciate what has changed over the years. I think that is right. There is a question of how we communicate that—I get that.
The Department of Finance is the comptroller-general of the PBS…They [Department of Finance] are engaged with us in our committees and that is valuable, but the point I make is that—and I have had these discussions before—we construct these documents in accordance with the rules that are given to us…
The FPR really asks [Defence] to think about organisational performance and to get more value out of how the whole corporate system runs. Many of the reforms that we have made and the way that we have tried to present that in the story that we have told through the PBS, right through to the annual report—and we are still evolving it—is to really talk about how the organisation as a single One Defence entity brings its parts together to achieve a set of outcomes for government. They are defined in the corporate plan as 'purposes', which is the language of the PGPA Act, but are defined in the PBS as 'outcomes' and 'programs'. What we are trying to do is bring those together so that everyone can see the relationship between our spends and between what we say we are going to do and what we actually do. So some of the programmatic structures that Mark (Dr Thompson) and Andrew (Dr Davies) recommended to the Committee be transparent, are items Defence can make visible, but it is not necessarily the way in which we judge and assess our own performance as an organisation…
Defence is working hard to implement the PGPA Act to its intent and to increase the capacity of the government and everyone else who reads all our documents—the annual report is only a part of it—to understand how we think about performance, what we think is important and how we measure our success.
Committee Comment
3.53
The Committee notes that progress is being made by the Department of Defence in tracking the costs and status of military capability. Despite this, the Department’s reporting requirement does not yet provide sufficient data to enable full Parliamentary and public transparency. The Committee will work with the Department of Defence through the implementation of the new methodology to review Defence Annual Reports and to remove any impediments to more transparent reporting by the Department to the Parliament.
3.54
The Committee recommends that the Department of Defence improve:
the consistency between the Defence portfolio budget statements and the Defence annual report;
the reporting of Departmental expenditure on major projects in real as opposed to out-turn dollars; and
the reporting on the cost and status of Australian Defence Force capability.
Coordination and de-confliction
3.55
The Committee inquired into how the Department of Defence was managing enterprise wide change, specifically how the Department coordinated and de-conflicted FPR and other reform programs.
3.56
The Department reinforced the role the five FPR work stream leads have in strengthening the strategic centre, developing the new capability life cycle, enhancing the effects enablers deliver, improving the workforce and behaviours. In addition, the Department advised:
The FPR Implementation Committee, headed by the Secretary and the Chief of the Defence Force, meets weekly to set the direction, provide drive and is the decision-making body for the delivery of the Implementation Plan.
The FPR Oversight Board provides advice to Government on the implementation of the FPR recommendations. The Oversight Board is independent of the department and consists of the five original Review team members, plus Erica Smyth. The Board’s role is to provide advice to the Minister for Defence on the progress Defence is making in implementing the FPR.
The FPR Implementation Office provides support to the Implementation Committee and the Oversight Board to effect change and ensure implementation is aligned with the intent of the recommendations. The Implementation Office is responsible for the coordination of the implementation plan, governance, reporting and corporate wide communication of the implementation program.
Committee Comment
3.57
The Department of Defence’s challenge is to understand, synchronise and resource all organisational change, which the Department advised is being achieved through coordination in ADFHQ by the FPR work stream leads. The Committee acknowledges this central control and looks forward to, in 2018, reviewing the systems and process that enable timely bottom fed decision making to enable prioritisation and the allocation of appropriate resources during future reviews of the Department of Defence annual reports.
Institutionalising cultural change
3.58
The Committee inquired how the Department of Defence culture is being adjusted to institutionalise desired reform end-states. The Department advised:
Many activities are underway to change behaviour including focusing on strengthening accountability of the Senior Leadership Group and ensuring that decision making meets the needs of Defence as a whole and delivers Government objectives.
3.59
The Department also advised that significant achievements to date include:
All Senior Leadership Group members have a Role Charter clearly outlining their individual accountabilities.
One Defence Leadership Behaviours have been developed and integrated into Defence leadership courses and performance management frameworks (at the Senior Executive Service level).
All Senior Leadership Group, including Senior Executive Service and Star Rank members have participated in a 360° feedback process.
An ‘upward feedback’ program has been introduced for Australian Public Service and Australian Defence Force members, including Senior Executive Service and Star Rank members.
A leadership program for Executive Level staff Leading for Reform continues to be delivered.
Committee Comment
3.60
The Committee acknowledges that the ADFHQ and subordinate structures and responsibilities have established the organisation coveted throughout the FPR; however notes that organisational structure is only one, albeit an important aspect of the reform process and that the Department of Defence must remain committed to the task if long term change is to be achieved.
3.61
The Committee will monitor the rate and depth of change throughout 2018.
Workforce
3.62
The Department of Defence has amended Senior Executive Service (SES) performance agreements, to measure individual performance by both outcomes achieved and the demonstration of One Defence Leadership Behaviours in the delivery of those outcomes. The Department is also providing stronger support and coaching to managers and supervisors, with a key element being a definition of ‘good people management’ in the context of the One Defence Leadership behaviours, which has been embedded in occupational profiles and recruitment processes.
Committee Comment
3.63
The Department of Defence is acutely aware that strong leadership, adequate resourcing and an enduring commitment to modify attitudes and behaviours to those required to sustain an agile, strategic, effective and efficient organisation the Department of Defence aspires to be must be demonstrated over the course.
Committee Comment
3.64
Implementing the FPR has been one of the largest organisational change programs undertaken in an Australian Government department. While strong progress is being made, critical work and focused leadership over the next decade will be required. The Department of Defence will need to succeed in institutionalising the desired behaviours if it is to achieve community wide acceptance that the ADF has truly reformed to be an inclusive, effective, efficient and transparent organisation sought by the FPR.
3.65
The Committee acknowledges the balance that must be achieved between transparency of the Integrated Investment and sustainment programs and the dynamic, risk-based management required to introduce, sustain and in time dispose of high tech systems and capability. It is clear while reform is progressing well, in 2018, the Department of Defence must do more, both in public and classified material (Committee-in-Confidence), to enable the Parliament and external stakeholders to understand and provide oversight of one of Government’s largest expenditure programs.
3.66
The Committee was encouraged by the engagement between the Department of Defence and Central agencies (Finance and Prime Minister and Cabinet) seeking to improve and harmonise performance reporting with organisational business processes.
3.67
The Committee applauds the effort the Department of Defence has made in clarifying roles, responsibilities and expectations for the Executive team. The Committee is disappointed however, that requests for practical examples of the transition of similar initiatives at the operational and tactical levels were not provided by the Department. The Committee has concluded that full organisational alignment of the One Defence behaviours and cultures is yet to be achieved. It is the Committee’s view that the Parliament, through the Defence Sub‑Committee of the JSCFADT, can and should play a more active role in oversighting and supporting these long term reforms. The Committee looks forward to obtaining evidence of operational and tactical implementation during 2018.
3.68
The challenge remaining for the Department of Defence is to ensure the cultural change achieved to date becomes routine business and to ensure that the organisation does not revert to its old systems and behaviours. The Committee is encouraged by Government’s decision to extend the FPR oversight board for another year to assist the Department achieve this challenge.