CHAPTER 3 - IMPLEMENTATION PLAN
3.1.1 Financial legislation will have a significant impact onthe timing and nature of the implementation.
3.1.2 In this regard, Part 7 of the proposed Financial Managementand Accountability Act 1997 (FMA), which is planned to commencefrom 1 July 1997, specifies the financial responsibilities ofChief Executives in the Australian Public Service. The Clerk ofeach enlarged chamber department will be required in law to managethe affairs of the whole department, ie including the joint functions,in a way that promotes proper use of the Commonwealth resourcesfor which the Clerk is responsible. Proper use is defined by theBill to mean efficient, effective and ethical use. The ethicaluse of funds for joint functions, in the opinion of the workinggroup, would include the balanced provision of services to eachchamber. Also, the explanatory memorandum for the FMA Bill recognisesthat a Chief Executive's responsibilities include the need tomanage a department to achieve qualitative outcomes, eg in relationto joint functions and the above-mentioned SLAs.
3.1.3 Another matter which would facilitatecoordination of joint functions is the formal requirement to establishan audit committee. It should be noted that the role of the auditcommittee is more than to ensure compliance with financial andother legislation. It is also to ensure the proper use of resourcesand to cover performance issues such as the achievement of qualityoutputs and required outcomes. The working group considers thatthe Clerks should agree that, when considering joint functions,both departments be represented on each departmental audit committee.Alternatively, the departmental audit committees of each chamberdepartment could meet jointly when considering joint functions.
3.1.4 The proposed FMA Act, at section 32, contains a provisionto enable the Finance Minister, on change of functions duringthe financial year, to transfer funds between two parliamentarydepartments. This transfer may only be undertaken in accordancewith a written recommendation of the Presiding Officers (section32 is derived from the current section 35A of the Audit Act1901). When the necessary changes to the Public Service Actbecome law, this provision will enable joint funds to be transferredat a time agreed by the Presiding Officers.
3.2.1 The Public Service Act 1922, at sections 9 to 9Band Schedules 2 and 3, specifies the five parliamentary departmentsand the heads of those departments. Under subsection 9(4), theofficers of each department are deemed to constitute a separatedepartment under the Act. In addition to the continuing officesof the Clerk of the Senate and the Clerk of the House of Representatives,the offices of the Parliamentary Librarian, Principal ParliamentaryReporter and Secretary to the Joint House Department are statutoryoffices filled by the Governor-General on the recommendation ofthe Presiding Officer(s). Other Acts, such as the Long ServiceLeave (Commonwealth Employees) Act 1976, also refer explicitlyto the joint parliamentary departments.
3.2.2 In May 1990, Attorney-General Duffy provided advice to thethen Presiding Officers from the Chief General Counsel of theAttorney-General's Department that, inter alia:
- the Public Service Act does not expressly confer on the PresidingOfficers the authority to alter the structures or responsibilitiesof parliamentary departments; and
- in the case of the three joint parliamentary departments,the authority to alter their function rests with the Houses(acting jointly).
The Chief General Counsel stated that he had consulted the Solicitor-Generalon the matters covered and that:
- he generally agreed with the views expressed;
- he regarded the residual uncertainties on the matters as unsatisfactory;and
- he suggested that the uncertainty concerning the structureand functions of the parliamentary administration be resolvedby legislation.
3.2.2 Accordingly, the working group considers statutory changesare necessary to abolish the three joint parliamentary departmentsand transfer all functions. This would need to be effected byamendment to existing legislation or by the proposed new PublicService Act. Given the need for legislative change to completethe amalgamation of all joint functions into the chamber departments,the timetable proposed is dependent on the legislative programsof each House.
3.2.4 Under the current Public Service Act, the Secretary/Clerkof each department is responsible to the relevant Presiding Officer(s)for its general working and for all of its business. Under theGovernment's proposed model for a new Public Service Act, thepowers and responsibilities of the Chief Executive would in lawbe strengthened. This would be consistent with the existing provisionsof the Workplace Relations Act 1996 as applied to Commonwealthagencies. In particular, the employing authority is vested inthe relevant Chief Executive (Clerk) - including for joint functionsadministered within that department. This means that it is theClerk who has the power to enter into a Certified Agreement coveringan expanded chamber department and the power to make AustralianWorkplace Agreements.
3.2.5 As a point of principle, the group considers that in respectof the activities of the five departments in 1997-98, there betwo annual reports and financial statements only, for the twodepartments after amalgamation.
3.3.1 Given the likely timing for any change to the Public ServiceAct and to other legislation, the working group considers thatthe Appropriation (Parliamentary Departments) Bill 1997-98 shouldinclude separate appropriations for the existing five parliamentarydepartments. The working group has identified that, with the adoptionof a more global funding approach, efficiencies to enable thecurrent chamber departments' new policy proposals (NPPs) - whichrelate to enhanced services to senators and members - to be providedfrom funds allocated for 1997-98. Subject to an assurance fromthe Prime Minister on retention of any savings, the PresidingOfficers may reconsider the need to pursue the NPPs.
3.3.2 The group notes that, in relation to previous proposed amalgamationproposals, the then Minister for Finance and the Department ofFinance recognised that savings achieved should be available forthe new entity. Parliament's funding should be maintained at reallevels, other than for APS-wide changes and agreed budget-neutraltransfers. In written advice the Department of Finance has statedthat, as a matter of practice, where departments create savingsby self-initiated reforms such as an amalgamation, governmenthas not insisted that such savings be returned to consolidatedrevenue. On the contrary, Finance has stated that savings areavailable to the restructured department to further improve thequality and timeliness of service delivery, including the fundingof new policy proposals. It would be expected that this principlewould be all the more strongly adhered to by government with respectto parliamentary appropriations in the context of the proposedamalgamation.
3.3.3 As far as is currently known, it is not the intention ofthe government to reduce the overall level of parliamentary appropriationsother than as a result of whole-of-government efficiency measures.The proposed amalgamation will result in a more effective andefficient use of the existing level of appropriations (less efficiencydividends) in maintaining and improving the delivery of servicesto members and senators. The amalgamation should be able to fundthe essential NPPs submitted in 1996-97 which would otherwisehave required specific supplementary funding from government.
3.3.4 Given previous legal advicefrom the Attorney-General's Department in relation to section83 of the Constitution, the working group recommends that the1997-98 budget cover for the chamber departments NPPs be movedfrom the Joint House Department to the chamber departments. Whenfunctions are transferred formally to the chamber departments,under the proposed FMA Act or existing Audit Act provisions referredto above, the funds involved should then be re-allocated by theMinister for Finance following a request of the Presiding Officers.
3.3.5 It is essential that fundingof joint functions be transparent. To assist with this, it issuggested that future Portfolio Budget Statement coverage of jointfunctions located administratively within either chamber departmentbe tabled in both Houses and be available for examination duringany estimates processes.
3.4.1 The process of amalgamating five departments into two willhave the effect of displacing a number of parliamentary staffin each of the five parliamentary departments. Every reasonableeffort should be made to resolve the position of displaced staffon a voluntary, consensual basis by means of offers of redeploymentto vacant positions or voluntary redundancy.
3.4.2 To facilitate this process, allpermanent recruitment into the parliamentary departments' corporatemanagement areas, and to positions to which suitable corporatemanagement staff could be transferred, should be temporarily frozen.However, it should remain open to a head of department to authorisethe permanent filling of a vacancy by an external applicant ifsuch action is essential for operational reasons and the vacancycannot reasonably be filled by an officer displaced, or likelyto be displaced, by the amalgamation.
3.4.3 Transitional arrangements will be needed to allow for asmooth transfer of functions and the maintenance of proper standardsfor joint service delivery. Some officers who might otherwisehave been displaced will be needed to work for a period of timeon the amalgamation project, particularly in corporate managementareas. Such a process will allow further opportunity for naturalattrition or voluntary redundancy to produce voluntary outcomesto the issue of displaced officers.
3.4.4 Staff and staff associationsshould be advised that equity and merit principles will be appliedto all staff involved, including those in the existing chamberdepartments, and actions should be taken to ensure staff see thatthese principles are applied in practice. The working group recommendsthat the Presiding Officers give a formal undertaking that, asfar as is practicable, any staff reductions will be by redeployment,natural attrition or voluntary redundancy. In the event that potentiallysurplus officers remain, the working group recommends there shouldbe a spill of positions at the levels/classifications of the affectedofficers.
3.4.5 Staff in joint functions providing direct services to senators,members and parliamentary committees other than corporate servicesshould not be impacted upon significantly by the proposed changein administrative arrangements. Synchronisation of departmentalpolicies and varying application of some conditions of employmentwill be required. Once the Presiding Officers agree on the locationof the joint functions, corporate management staff will need toconsider at officer level the practical integration problems thatwill arise. One issue is that DPRS and JHD both have industrialagreements which, although lapsing with the abolition of thosedepartments, will need to be taken into account before the commencementof the new chamber departmental structures.
3.5.1 The heads of parliamentary departments ensured that a minuteoutlining the contents of the Presiding Officers' statements totheir respective chambers was available to staff from the momentthe statements were made on 5 March 1997. On Friday, 7 March 1997(the first non-sitting day after the statements), each parliamentarydepartment was addressed by its departmental head. Four departmentalconsultative councils had previously-scheduled meetings withindays of the Presiding Officers' statements, and the proposed amalgamationswere included on the agendas for discussion. Staff input and generalcomment to the group were welcomed, and a substantial amount ofcomment was received by the group and included in its deliberations.
3.5.2 The Presiding Officers responded to the CPSU (which representsthe largest number of staff in Parliament House) that, once thebroad structure had been determined, wide-ranging consultationswould be undertaken with parliamentary staff and with the representativesof staff associations.
3.5.3 The Employee Relations Office invited all staff associationswith representatives in Parliament House to meet with the workinggroup at a mutually convenient time to enable the associationsto advance viewpoints, and a meeting was held on the morning of14 March 1997. Some 19 staff association union officials and ParliamentHouse staff delegates attended the meeting. The general backgroundto the proposed amalgamation and the operations of the workinggroup were explained. A number of particular issues were raisedby the staff association representatives, and addressed by theworking group. These are detailed at Attachment 5.
3.5.4 The working group considersthat consultation of this kind is vital. The group feels thatit should be an important and on-going requirement of the restructuringprocess. In their support roles, all staff of the parliamentarydepartments, including those in corporate management, are importantstakeholders in the parliamentary endeavour. The way in whichthe amalgamation process is managed will send significant messagesto staff about their role and value in serving senators and members.
3.6.1 There are approximately 165 staff in the corporate managementareas of the five parliamentary departments (excluding staff providingservices direct to senators and members). Initial estimates oflonger-term likely savings from the elimination of duplicationare in the order of 40 to 50 staff (25% to 30%), which would generatesavings in salary dollars of $2m to $2.5m.
3.6.2 The working group examined if a rationalisation of corporateservices into one area might be achieved. The possibility of jointcontrol of one corporate services unit was considered but is notrecommended, particularly given public service and resource accountabilityrequirements. A single unit option also brings into considerationthe question of the resource requirements for each House, includingits members, being independent of the other House, and being seento be so.
3.6.3 Consequently, the group doesnot feel that the location of a single unit in one chamber departmentor the other is a preferred option. The functioning, funding andstaffing of each chamber department will inevitably become more,not less, complex as a result of the amalgamation. Corporate managementissues will become more, not less, challenging to ensure the maintenanceand improvement of service delivery to senators and members ina changing public service environment. The working group considerstherefore that each chamber department should retain a separatebut strengthened corporate management area .
3.6.4 The longer-term savings from the new structure will flowfrom the rationalisation of duplicated corporate management functions.However, in 1997-98, given the complexity of the integration taskand the costs of any voluntary redundancy payments, it is unlikelythat there will be any immediate savings. It is expected thatthe benefits will accrue in subsequent financial years.
3.6.5 The working group believes that these savings are not insignificant,but further improvement of services to senators and members willbe contingent upon efficiencies being realised in both the jointand separate operational areas of the amalgamated departments.
3.7.1 A proposed timetable of activities is at Attachment 6.This timetable is indicative only at this stage, and will needto be developed in close consultation with stakeholders.
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