A strong, skilled and supported workforce is integral to the capability of any institution, particularly to one whose mission is to serve the public interest. Evidence to the committee's inquiry demonstrated that the people of the Australian Public Service (APS) are overwhelmingly principled, hard-working and committed to serving the Australian community.
This observation is borne out by results from the 2020 APS Employee Census. 85 per cent of respondents believed strongly in the purpose and objectives of the APS, while 92 per cent indicated they were happy to go the 'extra mile' at work when required. Furthermore, 91 per cent of respondents reported that they understood how their role contributed to achieving an outcome for the Australian public. The committee observes, however, that the census ignores the tens of thousands of labour hire contractors who work side by side with APS staff providing public services.
A 'whole-of-service' approach
The Independent Review of the APS (Thodey Review) characterised the APS workforce as a 'valuable asset', that, if invested in and managed strategically, would provide a 'return many times over' to government and the Australian people.
However, it also identified a number of workforce management challenges to be addressed, remarking:
…there is much work to do in nurturing the APS's people and unlocking their true value.
The final report recommended the development of a 'whole-of-service' workforce strategy to build and sustain the way the APS 'attracts, develops and utilises' its people.
In response to this recommendation, in March 2021 the Australian Public Service Commission (APSC) released the APS Workforce Strategy 2025 (Workforce Strategy) as part of the APS reform agenda.
The Workforce Strategy represents an 'enterprise-wide view' on how to equip the APS for future challenges. It includes three focus areas for action through to 2025:
Attract, build and retain diverse skills, expertise and talent.
Embrace data, technology and flexible and responsive workforce models.
Strengthen integrity and purposeful leadership.
The Workforce Strategy is not intended to replace agency-level strategic and operational planning processes; rather is designed to support agencies to identify and build the workforce and capabilities needed for the future. The committee observes that the capacity of the Workforce Strategy to act as a 'strategy' is limited by what an Organisation for Economic Co-operation and Development case study titled Workforce planning in the Australian Public Service describes as the 'the decentralised nature of the APS'. The committee notes that because the ambition of the Workforce Strategy is not to replace agency-level workforce strategy planning, areas with poor workforce culture or weak workforce planning may be left behind.
Taking into account the findings of the Thodey Review and recognising the action areas outlined in the Workforce Strategy, the committee focused its attention on a number of issues relating to the strategic management of the APS workforce. These included:
the workplace bargaining policy of the APS;
the pay and conditions of the APS;
the classifications and hierarchy of the APS;
mobility within the APS; and
matters relating to the APS Academy, graduate recruitment and diversity.
This chapter will examine each of these elements in turn and conclude with the committee's consolidated views.
Workplace bargaining policy
The committee heard evidence that indicated that the workplace bargaining arrangements in place for the APS had negative implications for the capability of the sector.
The Public Sector Workplace Relations Policy 2020 was released on 13 November 2020 and superseded the Workplace Bargaining Policy 2018. On its announcement, the government stated that the 2020 policy would ensure that APS wage rises would 'no longer exceed wage rises in the private sector' and would 'allow APS wage rises to follow the private sector wage growth when it eventually exceeds 2 per cent'.
The Community and Public Sector Union (CPSU) argued that the Coalition Government's workplace bargaining approach since 2014 had negatively impacted on the APS's ability to attract and retain skilled staff, while creating barriers to staff mobility and career progression across the APS.
In regard to the current policy, the CPSU outlined:
The Government's bargaining policy now caps wage increases to the private sector Wage Price Index, restricts content in agreements and bans any enhancements to conditions. This is despite the fact that APS employees are already paid significantly less than their equivalents in the private sector. The policy's application extends beyond the Australian Public Service to entities including key scientific research organisations CSIRO [Commonwealth Scientific and Industrial Research Organisation] and ANSTO [Australian Nuclear Science and Technology Organisation].
The Wage Price Index (WPI) measures changes in the price of labour, unaffected by compositional shifts in the labour force, hours worked, or employee characteristics.
The CPSU advised that the requirement to cap APS wage increases to the WPI meant that pay increases could be unknown to APS employees at the time they had to vote on them. It explained:
The new Bargaining Policy ties federal public sector pay rises to annual changes in private sector wages, to be calculated at a later date. Under this policy, employees will be required to vote on an agreement that leaves future pay rates unknown.
It also asserted that the pay increases available to APS employees would fluctuate year to year:
The maximum pay increase payable in each year of an enterprise agreement or determination will be capped at the annual WPI for the private sector for the most recent June quarter.
The CPSU advised that the current APS bargaining policy still prevented agencies from including tailored arrangements (such as specialised pay structures) in enterprise agreements, despite such arrangements forming a 'significant component' to attracting and building critical specialist capabilities in areas such as information and communications technology (ICT).
The CPSU also argued that the current bargaining policy removed consultation and delegate rights from enterprise agreements, which ran contrary to building constructive workplace relations. It detailed:
The removing of pre-decision and post-decision consultation provisions runs contrary to building and maintaining constructive and productive workplace relations within APS agencies where staff are involved to help determine the best outcomes. The ability to have a say before a decision is made is materially different to consultation after the fact. It can affect agency innovation and adaptation.
In August 2021 the CPSU prepared a guide for its members to assist them in understanding the current policy. It advised that the 2020 policy continued the approach of previous policies in a number of ways which worked to make improvements to conditions 'very difficult'. It summarised:
'No enhancements' – the new policy continues this rule, making it difficult to achieve sensible improvements to enterprise agreements
Shifting conditions into policy – the government continues to push rights and entitlements into policy which the employer can change overnight.
Consultation under attack – agencies that have started bargaining under the new Bargaining Policy have been forced to water down consultation rights, with the government saying that agencies should no longer be required to reach agreement with consultative committees on basic consultation processes. This means agencies can do what they like, and water down or remove important consultation protections that were put in place in the last bargaining round.
The CPSU recommended that the government act as a model employer and revise the workplace bargaining policy to enable agencies to genuinely bargain in good faith, without restrictions on pay and with the capacity to enhance employment conditions.
Inconsistent pay and conditions across the APS
The committee received evidence indicating that the complexity and inconsistency of pay and conditions across the APS had a significant impact on capability by adversely impacting workforce recruitment, development, mobility and retention.
For example, the CPSU asserted that the move away from a common set of pay and conditions in the APS was a consequence of enterprise bargaining. It advised that there were significant pay differentials across the APS, as well as differences across agencies in standard working hours, leave entitlements and many other core conditions.
To illustrate, the CPSU noted that as at 30 June 2019, the top pay rate for an Executive Level (EL) 2 position in the Department of Defence was $190 230, while the lowest pay rate for an EL 2 was in Aboriginal Hostels Limited at $120 411. Additionally, it noted that the top rate for an APS 3 level position was $75 717 for Meat Inspectors within the Department of Agriculture, Water and the Environment, while the lowest APS 3 rate was $57 136 in Aboriginal Hostels Limited.
The CPSU contended that the arbitrary differences in pay and conditions negatively impacted APS capability through discouraging inter-agency mobility, reducing the sense of a unified APS, and causing unnecessary complexity during Machinery of Government (MoG) changes.
Ms Melissa Donnelly, National Secretary of the CPSU, elaborated on this position:
…we do think these pay differences are a significant constraint on capability, because it limits the capacity for mobility within the APS. It has implications also for career progression within the APS. Many reviews across the APS have identified the need to promote greater mobility across the APS and therefore a more greatly detailed understanding of different policy areas. But the idea that you would move and experience a $70,000 pay cut is not a compelling one, of course, for some employees. So it does have real capacity implications.
As set out earlier in this report, Andrew Podger, an Honorary Professor of Public Policy at the Australian National University with a lengthy career at senior executive levels of the APS, gave evidence to the committee in a private capacity. He submitted that APS capability was reliant upon 'attracting, retaining, developing and optimally utilising' its employees. He noted that a key factor in this was remuneration and other non-monetary rewards.
Professor Podger was of the view that the current approach to setting APS pay and conditions lacked economic rationale and had adverse implications for the recruitment, development and retention of the workforce.
Additionally, he noted that the many problematic aspects of the current approach were well-known, despite government assertions to the contrary. He stated:
The current approach is administratively cumbersome and costly and, despite calls for more consistency for well over a decade now, differences across agencies have not narrowed and problems when machinery of government changes occur have grown more serious.
Professor Podger observed that there was no explicit consideration under the current approach of whether APS pay and conditions were attracting and retaining employees to properly skill the workforce, nor whether they were enhancing development and making the best use of resources.
To remedy this, Professor Podger recommended a proper 'market' approach based on APS-wide assessments for different occupational groups, instead of the current 'enterprise' approach (where each agency is required to negotiate pay and conditions based on artificial 'productivity' bargains).
It is quite likely that a proper market comparison, combined with careful consideration of the public sector context and internal relativities aimed to ensure remuneration corresponds with respective responsibilities, would identify that some APS employees are overpaid and others underpaid. It would certainly confirm that variations across the APS are not justified. It would also have the advantage of greatly reduced transaction costs across the APS by re-introducing centralised negotiations.
The Thodey Review also identified the challenges associated with the 'inconsistent and complex' pay ranges and conditions within the APS. It observed that in 2019 there were over 100 enterprise agreements within the APS, and that many agreements had at least five, but some up to ten, individual pay points within classifications. It found that this could 'complicate and create transitional problems' during MoG changes.
The committee was provided with some analysis by the APSC which assessed the number of women employed at the different APS, EL and Senior Executive Service (SES) levels across the APS. On its own, this data does not account for the gender wage gap of 6.6 per cent within the APS, and it is apparent to the committee that the 'enterprise approach' is a contributing factor to the gender wage gap. Further work will be required to identify the departments and agencies where lower paid women are concentrated, in order to develop an effective strategy to address the gender wage gap.
The Thodey Review cited feedback indicating that the disparity in wages and conditions discouraged mobility and reduced the sense of a unified service with a strong career structure. It commented that these themes were consistent with evidence examined in the 2010 Ahead of the Game report of the Advisory Group on Reform of Australian Government Administration, chaired by Mr Terry Moran AC.
The final report made particular mention of the lower salaries found in agencies with high representations of Indigenous employees:
…the agencies with the highest proportion of Aboriginal and Torres Strait Islander employees — Aboriginal Hostels Ltd and the Australian Institute of Aboriginal and Torres Strait Islander Studies — are the bottom outliers of each pay classification. The maximum salary for an EL 1 (middle manager) at Aboriginal Hostels Ltd in 2017 was $99,941, while at Finance it was $136,141, a $36,200 difference. This level of discrepancy, particularly in agencies with a high representation of Indigenous employees whom the APS must attract and retain, is unacceptable.
The Thodey Review recommended a move towards common core conditions and pay scales over time to reduce complexity, improve efficiency and 'enable the APS to be a united high-performing organisation'. It suggested that this be done 'at all levels with the intent of reducing complexity and administrative burden, bringing the APS in line with good corporate practice'.
Specifically, recommendation 33 stated:
Government to review and set common core conditions for APS-level and EL employees for agencies to pursue during bargaining.
Government to commission APSC to develop an implementation plan for introducing service-wide minimum and maximum pay points for APS-level and EL employees.
Remuneration Tribunal to determine pay ranges and common standard conditions for each Senior Executive Service (SES) band.
Remuneration Tribunal to review remuneration of department secretaries in light of their shared and strengthened responsibilities as members of the Secretaries Board.
In its response to the Thodey Review, the government stated that it did not agree with recommendation 33. It explained:
Current policies around APS pay and conditions are working effectively. Employees and agencies are agreeing to new enterprise agreements or productivity-based pay rises on existing terms and conditions, in an efficient and effective manner. The Government accepts the Secretaries Board advice not to proceed with service wide pay points and will continue with the existing APS Enterprise Bargaining Framework. The Secretaries Board will further consider options to inject greater discipline in SES remuneration as a means of facilitating greater SES mobility.
Classifications and hierarchy
The Thodey Review observed that the majority of APS agencies adopted a 'traditional hierarchical model' for team structures and workplaces, characterised by 'pyramid like structures' with embedded lines of accountability supporting senior leaders and ministers. It noted that this model was 'well-suited' to particular types of work, particularly those that require high levels of accountability and where the 'consequences of failure are high'.
However, the final report concluded that many of the current organisational arrangements in the APS are 'ineffective' and 'insufficiently flexible and responsive for an increasingly connected and changing world'.
It cited feedback from APS employees indicating that:
up to 72 per cent of Australian Government public servants agree or strongly agree that 'the public service is too hierarchical';
only 28 per cent of APS employees agree that 'decision-making processes at my agency are timely and efficient';
only 27 per cent APS employees agree that 'appropriate risk taking is rewarded in my agency'; and
nearly one in two APS employees — 44 per cent of the total — feel they have 'insufficient time to develop and implement innovations'.
The Thodey Review identified that there was a need for the APS to adopt fundamental changes to its organisational structures and hierarchies to 'best respond to the different scenarios that may play out by 2030'.
In recommendation 32 of its final report it set out a range of actions for the APS to pursue in order to 'streamline management and adopt best-practice ways of working to reduce hierarchy, improve decision-making, and bring the right APS expertise and resources'.
The APSC established the APS Hierarchy and Classification Review (HC Review) in March 2021 as part of the government's response to recommendation 32 of the Thodey Review.
The remit of the HC Review is to examine the APS Classification Framework (both SES and non-SES levels) and its application in order to provide recommendations on an optimal management structure for the APS.
An independent panel was appointed to oversee the review, comprised of Dr Heath Smith PSM, Ms Kathryn Fagg AO FTSE and Mr Finn Pratt AO PSM.
The specific deliverables for the initiative are:
Review and report on the current APS classification framework and develop recommendations on a 'clear, effective and efficient structure that is fit for the future'.
Provide advice to the APS Commissioner on implementation of recommendations arising from the review.
Review and update the 2014 APS Framework for Optimal Management Structure.
The APSC informed the committee that the review panel had undertaken extensive engagement with APS employees, the private sector, union bodies, interstate and international public sectors, and other interested parties.
It advised that the review panel presented 'emerging recommendations' to the Secretaries Board for feedback in July 2021 and was 'on track' to deliver the final report and supporting documents by the end of year, as requested by the APS Commissioner.
Mobility within the APS
The Thodey Review identified that career paths that included 'appropriate levels' of mobility were critical to the success of the APS, and recommended a range of measures to improve mobility. It noted that 'moving around' was a key avenue of professional development for individual public servants which also benefited agencies.
The final report observed:
The APS would benefit from more porous boundaries — more staff movement between agencies as well as between the public service and other jurisdictions and sectors. The APS interagency mobility rate, which measures movement of employees between agencies in a year, is currently 2.5 per cent. This means in practice that 72 per cent of APS employees today have only ever worked in one agency.
The committee received evidence that illustrated the importance of increased mobility to APS capability. In particular, the committee heard that the advent of the COVID-19 pandemic necessitated a greater mobility of APS staff within and across agencies in order to swiftly react to the changed work priorities of the crisis.
For example, Mr Philip Gaetjens, Secretary of the Department of Prime Minister and Cabinet (PM&C) detailed:
The APSC State of the Service found that, almost half of all APS employees shifted to work on activities related to COVID-19 from February last year ; more than 2,300 employees moved to other agencies; and around 9,000 employees shifted to priority tasks within their own portfolios or other agencies. Supported by the APS Workforce Management Taskforce, led by the APS Commissioner, more than 1,700 staff from other Commonwealth agencies were redeployed to Services Australia to answer calls and process claims.
APS Commissioner Mr Peter Woolcott AO commented on the need to continue the focus on mobility in the longer term:
…2020 saw greater mobility across the APS and thousands of APS staff demonstrated their flexibility in shifting their focus on different priorities. We want to lock these changes in, keep tuning the system and ensure that we strive for better.
The APSC advised the committee that it had coordinated various 'surge' requests during 2020 and that overall these had been a good opportunity for the public service to demonstrate its 'agility and versatility'.
It stated that the experience and lessons learned from mobility initiatives had informed the development of the APS Mobility Framework, a deliverable of the Workforce Strategy. The framework is aimed at supporting agencies to make strategic use of employee mobility, particularly in regard to three 'high value' uses:
To address surges in demand for existing services or new priorities.
To solve complex policy program or service delivery problems.
To develop employees and create a pipeline of talent.
To build on the surge responses necessitated by the pandemic, the APSC informed the committee it had established the APS Surge Reserve as an 'ongoing function' to allow the APS to respond rapidly to future crises.
The APSC indicated that the arrangements for the Surge Reserve were settled in early 2021, with the Secretaries Board agreeing to arrangements in April 2021.
It outlined the goals of the initiative:
The APS Surge Reserve provides the capacity to rapidly mobilise Australian Public Service (APS) volunteers in large numbers in response to a crisis. The APS Surge Reserve complements, rather than replaces, existing agency specific and well established disaster response and management arrangements. Surge Reservists will deploy for short periods (initial terms of up to eight weeks) to help colleagues address a surge in demand for government services or support.
The Surge Reserve is a collective initiative of the APS with every portfolio contributing to the Reserve.
Surge Reservists may be asked do a range work carried out by government, depending on the need.
Surge Reservists will be able to contribute their efforts to help Australians in a time of crisis.
The APSC advised that as at April 2021, 2091 APS employees had nominated for the Surge Reserve. It provided the committee with breakdowns of the volunteer cohort by portfolio, location and APS classification:
Figure 7.1: Surge Reserve nominees by portfolio
[Source: Source: Australian Public Service Commission, additional information, received 28 September 2021, p. 2.]
Figure 7.2: Surge Reserve nominees by location
[Source: Australian Public Service Commission, additional information, received 28 September 2021, p. 2.]
Figure 7.3: Surge Reserve nominees by APS classification
[Source: Australian Public Service Commission, additional information, received 28 September 2021, p. 2.]
The APSC informed the committee that it expected the numbers of volunteers for the Surge Reserve to grow to 3000 to 4000 over time, with the expectation that only a subset would be available in a significant crisis. It noted that in response to a given crisis, portfolio departments and agencies would be asked by the APSC to advise which of their 'reservists' were available for deployment based on business needs and staff availability.
The APSC also furnished the committee with detail on the 'activations' of the Surge Reserve to date:
Figure 7.4: Activations of the Surge Reserve – data provided September 2021
[Source: Australian Public Service Commission, additional information, received 28 September 2021, p. 3.]
In terms of evaluating the operations of the Surge Reserve, the APSC reported that it would continue to evaluate and refine the arrangements of the initiative as it progressed. It advised that it conducted surveys of volunteers at the conclusion of their deployment, and that results from the first deployment to the Department of Health showed:
86 per cent of respondents were able to identify positive elements of the deployment (including the opportunity to try new work, learn new skills and broaden networks).
77 per cent of respondents indicated they were 'satisfied' or 'very satisfied' with the deployment.
The APSC further noted that a review of the operation of the deployments to Services Australia in July 2021 would be conducted, and 'further enhancements' to the Surge Reserve arrangements would be considered in early 2022.
Building and upskilling a diverse workforce
The following section sets out evidence received by the committee on:
graduate recruitment; and
diversity within the APS workforce.
In regard to learning and development opportunities for the APS workforce, the committee received information on the newly formed APS Academy.
In July 2020 the APSC commissioned a review to consider the future role of its Centre for Leadership and Learning (CLL) in supporting learning and development initiatives in the APS. One of the key outcomes of the process was the creation of the Academy.
Established on 1 July 2021, the Academy is focused on building capabilities central to 'public sector craft' and supporting 'one-APS capability development'.
The APS Commissioner characterised public sector craft as things that only public servants as 'insiders' know. He detailed:
….knowing how to work with government, knowing how to work with ministers, knowing how to understand the budget process, knowing how to implement policy, knowing how to project policy and be able to persuade ministers that this is the right course of action, because you as ministers have so many other competing sources of advice these days as well. So it's a changing environment. The focus is very much on the craft of being a public servant and providing advice and implementing decisions…
The APSC advised that the Academy operates as a 'national, networked model', combining agency partnerships with extended networks such as academic institutions, specialist providers and the Australia and New Zealand School of Government (ANZSOG). It outlined:
The Academy's development focus will be on building capabilities central to the 'APS craft': in short, leadership, integrity, governance, policy, delivery and engagement. It will emphasise the importance of a broad suite of learning approaches, including experiential learning, on-the-job training, mobility and secondments, as well as some intensive face-to-face course offerings.
Submitters to the inquiry welcomed the establishment of the Academy and its focus on public sector craft, although noted that it had not been in operation long enough to gauge its success.
For example, at a public hearing in August 2021 the Centre for Policy Development (CPD) stated:
It's early days because it's [the Academy] only just been launched. One of the things we emphasised in our interactions with the Thodey panel, in its review, and in our submission to this and other related inquiries, has been the importance of a professions mindset across the public sector to develop what they call public sector craft but also deep expertise in areas. We think that's a very positive development and should really make a vital contribution over the next decade or so.
Dr Subho Banerjee, Deputy Chief Executive Officer (Research and Advisory) for ANZSOG who led the review into the APSC CLL, also emphasised the importance of public sector craft and the need to teach 'practical wisdom' – that is, the nuances and subtleties of excellence in public service.
He commented that he was encouraged by the creation of the Academy and the focus areas and learning approaches it encapsulated. He detailed:
I think it's all in this vein of trying to take really seriously what is special about being a public servant. What do you need that is really particular to excellence in public service? That builds on a good foundation of general professional skills: good writing, good communication, good team management, good team operation. There are a range of generic skills, but what's above that? It's things like: working in government; understanding the values of the APS; understanding what strategic policy really looks like in this context; what implementation looks like; really trying to get to what engagement is about, and how you can think about different forms of partnership with citizens in different kinds of ways. Those are the kinds of domains where we are trying to crystallise what is particular and special about the craft, and then there is thinking about a really innovative and interesting range of approaches to try to get to that.
The committee received evidence setting out the improvements in train in regard to APS graduate recruitment processes.
The APSC advised that over the past five years the number of APS agencies that recruited graduates had remained consistent, with up to 39 agencies regularly recruiting. It detailed:
Together they represent an average annual intake of approximately 1,300 Graduates across the APS. Numbers have been fairly consistent over the last 20 years, with the lowest intake being 722 in 2003/4 and the highest 1551 in 2010/11. Graduate recruitment is increasingly important as a source of new APS employees. The share of new recruits who are graduates has increased to 15 per cent in 2019–20 from around 6 per cent in 2000–01.
The APS Workforce Strategy observed that up until 2020, public service graduate programs were managed through a 'decentralised' model and the disparate approaches across agencies had proven problematic. It explained:
The user experience for prospective graduates was repetitive, time consuming and inconsistent, and agencies were competing against one another for talent.
To address this, in 2020 the APSC and partner agencies co-designed a new way to recruit graduates in a more collaborative manner, including a new portal on the APS Jobs platform. The updated portal functioned as a 'one-stop-shop' and meant graduates had more opportunities to apply for a number of roles across multiple agencies.
The success of the 2020 recruitment campaign informed the creation of the Australian Government Graduate Program (AGGP) in 2021, in which graduates could be considered for multiple agencies through a single application process.
The APSC stated that in 2021, in partnership with other agencies, it stood up generalist, economist, data and STEM (science, technology, engineering and mathematics) graduate streams to build on the success of the existing digital and HR (human resources) streams already established.
The APSC informed the committee that the Workforce Strategy had identified data, digital (e.g. ICT) and STEM as 'emerging capabilities' required by the APS. As such, the inclusion of those streams under the AGGP would facilitate an APS wide approach to recruiting the capabilities.
The APSC also forecast that as workforce requirements evolved, graduate streams would be implemented, scaled down or retired in line with the capabilities required in agencies.
The APSC reported that the AGGP received 8187 applications across all streams in 2021, which represented a 33 per cent increase on the previous year.
The diversity of the APS workforce was another area of interest for the committee.
The Thodey Review examined this topic in depth, noting that there was overwhelming evidence that diverse and inclusive organisations 'perform better and have happier people'. The final report elaborated:
Diversity — of background and life experience as well as in expertise and view points — creates challenge, provokes thought and encourages change. It provides different insights, which are especially valuable in tackling the complex and ambiguous problems faced by government each day. It produces better advice to ministers and better decisions, as they are more attuned to the needs and interests of all groups.
The Thodey Review acknowledged that while the APS had made progress over the years, it still struggled in some aspects of diversity and inclusion. It collated data from 2018 to illustrate:
Figure 7.5: Diversity by classification
The Thodey Review recommended a number of actions (set out in recommendation 25) to recruit, develop and promote more people with diverse view and backgrounds.
The government agreed with elements of the recommendation and explained:
The Secretaries Board is leading a range of actions to increase diversity and inclusion across the APS, through renewed Indigenous, gender and disability employment strategies. The Government has also requested the APS Commissioner to ensure the APS does more to retain and recruit older Australians. The Board does not consider additional goals and strategies are currently needed to advance this work and will continue to renew and update its approach to ensure it is effective.
The APSC informed the committee of three strategies to promote diversity and inclusion in the APS:
Commonwealth Aboriginal and Torres Strait Islander Workforce Strategy 2020–24
APS Disability Employment Strategy 2021–25
APS Gender Equality Strategy 2021–25 (undergoing a refresh in partnership with the Office for Women and expected to be released in late 2021).
In regard to the issue of pay equity, the APSC advised it collected remuneration data from all APS agencies on an annual basis, including hours worked, type of work, salary (including bonuses) allowances and superannuation.
The APSC informed the committee that the gender pay gap (i.e. the difference between the average full-time earnings of male and female employees) in the APS was 6.6 per cent in 2020, putting it below the current national figure of 14.2 per cent.
Workplace bargaining policy
The committee agrees with the views put forward by the CPSU. Public sector wage growth has fallen behind private sector wage growth, which means the public sector wage strategy is now acting as a drag on wage growth for Australians more generally.
Additionally, the committee notes that the damage inflicted upon the APS by the previous workplace bargaining policies implemented by the Coalition Government was examined in detail by the Senate Education and Employment References Committee in its 2016 report Siege of attrition: the Government's APS Bargaining Policy.
The committee is of the view that the government should revise the Public Sector Workplace Relations Policy 2020 to remove the cap on public sector wage increases tied to the WPI.
The committee is also of the view that the government revise the Public Sector Workplace Relations Policy 2020 to enable agencies to genuinely bargain, in good faith, without restrictions on enhancing employment conditions.
Finally, the committee considers that the government should revise the Public Sector Workplace Relations Policy 2020 to improve workers' rights to consultation. It considers that this would ensure the best outcomes for workplace decisions and improve the implementation strategies of government policy.
The committee recommends that the Australian Government revise the Public Sector Workplace Relations Policy 2020 to remove the cap on public sector wage increases tied to the Wage Price Index.
The committee recommends that the Australian Government revise the Public Sector Workplace Relations Policy 2020 to enable agencies to genuinely bargain, in good faith, without restrictions on enhancing employment conditions.
The committee recommends that the Australian Government revise the Public Sector Workplace Relations Policy 2020 to build a more collaborative workplace culture, including by improving consultation rights for staff through their union.
Inconsistent pay and conditions across the APS
The committee believes the government was wrong to reject recommendation 33 of the Thodey Review.
The evidence before the committee clearly contradicts the position put forward by the government that its current policies around APS pay and conditions are working. The considerable pay disparity between agencies and the lack of workforce mobility highlight the substantial issues with the current policy approach.
The committee considers there is much to be gained in shifting the APS towards common core conditions and pay scales over time, particularly if the change is effected in line with the implementation guidance suggested by the Thodey Review.
The committee considers such a shift would significantly improve APS capability by increasing efficiency, minimising administrative burden and creating a more unified sector. Once implemented, evidence of these efficiencies would be realised as soon as the next MoG change occurs.
In particular, the committee would like to echo the comments of the Thodey Review in regard to the low levels of pay across all classifications in agencies with a high representation of Indigenous employees, compared to the rates at the same levels in other APS agencies. This situation is not acceptable and must be remedied.
The committee recommends that the Australian Government implement recommendation 33 of the Independent Review of the Australian Public Service and move towards common core conditions and pay scales for APS- level and Executive Level employees.
Classifications and hierarchy
The committee awaits with interest the outcome of the APS Hierarchy and Classification Review. The need for increased flexibility and mobility across the APS has been repeatedly highlighted to the committee, and it is vital that APS organisational structures are designed to be responsive to the needs of the public now and into the future, rather than relying on an outdated hierarchical model.
The committee considers it important that the structures and hierarchies of the APS are fit for purpose. This will allow agencies to function in a streamlined manner with effective administration processes and clear pathways of accountability. To this end, it is necessary that the findings of the HC Review are made public, and action taken to implement its recommendations.
The committee recommends that the Secretaries Board and the Australian Public Service Commissioner publish the final report of the Australian Public Service Hierarchy and Classification Review upon receipt and act upon its recommendations as soon as practicable.
Mobility within the APS
The committee acknowledges the efforts of the public servants who took part in surge requests in response to the COVID-19 pandemic, both in the early stages of the crisis in 2020, as well as into 2021. It considers the significant degree of inter and intra agency mobility to be fine examples of what the APS can achieve when it works flexibly.
Additionally, the committee commends the APSC on the establishment of the APS Surge Reserve. The committee considers that the initiative will form part of the solution to increasing mobility in the APS in the longer term, which will in turn provide distinct capability benefits.
The committee also commends staff at all levels who have contributed to the growth of the Surge Reserve.
The committee encourages the APSC to continue to monitor and refine the operation of the Surge Reserve, and make public its evaluations.
Additionally, the committee would like to see increased collaboration across the APS facilitated through reduced barriers to career mobility. It will watch with interest the results of the APS Mobility Framework initiatives in the medium to long term. It encourages the APSC to continue to monitor and publish mobility metrics for all agencies in order to provide a comprehensive picture of the state of mobility across the APS.
The committee recommends that the Australian Public Service Commission commit to regular, published evaluation updates on the operations of the Australian Public Service Surge Reserve.
The committee recommends that the Australian Public Service Commission regularly monitor, collate and publish mobility metrics for agencies.
The committee is encouraged by the creation of the APS Academy. It considers that it is critically important to APS capability that individuals employed in the APS have a clear and practical understanding of public service craft.
As will be examined in the next chapter of this report, the committee is strongly of the view that there is a pressing need to crystallise the idea of service — to the public and to the Parliament, in addition to the government of the day — within the APS workforce at all levels.
The committee believes that a proper grasp of what is meant by 'public service' is essential to guarding against the insidious creep of public sector politicisation in Australia.
On a separate note, the committee is disappointed that the APSC spent almost $500 000 over two months on private contractors for elements of the design and build of the Academy. The committee understands this was because the APSC needed additional resources to cope with the workload. The committee wishes to express its astonishment at this situation and highlight it as a clear example of the excessive and inefficient reliance on private contractors wrought by the Average Staffing Level cap.
The committee encourages the APSC to closely monitor and evaluate the operation of the Academy, as well as seek and incorporate independent feedback (for example, from ANZSOG or the CPD) to continuously improve the program.
The committee recommends that the Australian Public Service Commission monitor and evaluate the operation of the Australian Public Service Academy and provide public, yearly updates on what the initiative has achieved in tangible terms.
The committee is pleased to see the concerns with the de-centralised model of graduate recruitment addressed through the establishment of the AGGP.
The committee is of the view that the APS must continue to evolve its recruitment practices and employee value proposition to ensure that it can compete with the private sector as an employer of choice for talented Australians.
The committee encourages the APSC to continue to monitor and refine the AGGP as necessary in order to ensure graduate recruitment contributes to addressing critical skill gaps in the APS.
The committee recommends that the Australian Public Service Commission monitor and evaluate the operation of the Australian Government Graduate Program in order to refine it as necessary so that graduate recruitment consistently contributes to addressing critical skill gaps in the Australian Public Service workforce.
The committee recommends that the Australian Government place greater importance on the role of the Australian Government Graduate Program and consider expanding it to a more ambitious scale, particularly as the Australian Public Service and the Australian economy more broadly recover from the impacts of the COVID-19 pandemic.
The committee feels strongly that the make-up of the APS must reflect the communities it serves.
It considers that high rates of diversity within a workforce bring a multitude of benefits, and in the context of this inquiry, would only work to improve the capability of the APS.
The committee holds an interest in the APS Gender Equality Strategy 2021–25, due to be released by the end of the year. It encourages the APSC to release the refreshed strategy in line with the announced timeframe.
Additionally, while pleased that the gender pay gap in the APS is below the national figure, the committee considers that a 6.6. per cent gap still too high. The committee considers that the proportion of women employed at each salary level, taken on its own, does not explain the persistence of the wage gap.
The committee is of the view that further research is required to establish why the gender wage gap persists in the APS, and whether the shift away from a common set of pay and conditions in the APS (as discussed earlier in this chapter) has reinforced this gender inequality.
In light of the current gender wage gap of 6.6 per cent, the committee recommends that the Australian Public Service Commission undertake analysis of why a gender wage gap in the Australian Public Service persists and implement a plan to eliminate it.
The committee recommends that the Australian Public Service Commission conduct research to establish whether the long-term shift away from a common set of pay and conditions across agencies has impacted on the gender wage gap within the Australian Public Service.