Table of Contents
Left: Prime Minister Paul Keating who first appointed Podger as Secretary of the Department of Administrative Services and the Arts in December 1993 (photo with kind permission of the Parliamentary Library)
Right: Prime Minister John Howard who appointed Podger as Secretary of the Department of Health and Family Services in March 1996, renewing the appointment as Secretary of the Department of Health and Aged Care in 2001, and appointing Podger as Public Service Commissioner from 2002 (photo by kind permission of the Parliamentary Library)
The contribution of secretaries to ‘collective responsibility’ involves a number of activities, which overlap and link with the activities involved in supporting the minister. These include:
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involvement with cabinet and cabinet committees such as the Expenditure Review Committee (ERC)
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contributing to cross-portfolio policy development and review
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participating in meetings of secretaries, particularly meetings chaired by the Secretary of the Department of the Prime Minister and Cabinet (PM&C).
In addition, there has been an increasing role for formal guidance from the Prime Minister to ministers on political priorities over a term of office. As described in Chapter 3, charter letters grew in importance, length and formality during the Howard years; while Prime Minister Rudd has not so far continued that practice, he is certainly no less interventionist in his style, placing strong emphasis on whole-of-government management and political control.
It was common practice under the Hawke, Keating and Howard Governments for officials to attend cabinet committee meetings (though not cabinet itself) and to be invited to contribute to the discussion. The Rudd Government has continued the practice. This has proven to be an effective way of ensuring informed and timely consideration of the issues by ministers. Ministers can choose not to have officials accompany them or to have the relevant policy expert, who is not the secretary (this apparently is less common under the Rudd Government). Unless I felt insufficiently knowledgeable on the matters under consideration, I usually sought to be the official involved, as I was most often able to relate the issues concerned to wider policies and experience. I also had more experience than most of how cabinet committees worked, having sat on the ERC for many years in the Department of Finance and provided briefings to the Prime Minister when in PM&C.
Table 4.1 Doing deals in the ERC
In the 1995 budget process, Brian Howe was having difficulty getting support from his colleagues for his vision of a continuing role for the Commonwealth in cities and regions. The Prime Minister, Paul Keating, was sympathetic, particularly about the Better Cities program: he suggested the final decision on its funding be deferred until the inner cabinet could reflect on the revenue available at the end of the budget process. Howe, however, needed not only to keep his proposal for that program alive, he needed to avoid the ERC rejecting everything else on the table in order to offset what some ERC members clearly considered an indulgence of the Prime Minister and his deputy.
Howe’s budget proposals covered a range of housing programs as well as cities and regional development. The standard ERC rule was that genuine, continuing savings must offset new policy. Howe’s proposal did not meet this requirement and certainly did not provide savings to offset any post-ERC decision to provide new capital funds for cities.
The ERC gave Howe a hard time and he and his adviser (who attended with me) were dejected, as it seemed nothing would go the minister’s way. I was, however, conscious that one of the minister’s proposals was not really a priority for the portfolio (it was included at the strong insistence of another adviser) and, indeed, I suspected we would not spend the allocation we already had for that program. I quietly asked Howe if I could propose a deal, offering not only to withdraw that proposal but to offer up some savings. He agreed with reluctance, assuming there was no hope of a useful decision. I put the idea to the Finance Minister, Kim Beazley, as a trade for all the other proposals except for Better Cities, which was to be deferred until later anyway. Beazley turned to Prime Minister Keating, who was about to close the meeting on a sour note, to say that perhaps a deal was possible after all. Howe indicated he would accept my suggestion, which Beazley recommended to the ERC.
Howe and his adviser were still despondent. They had not appreciated the significance of the deal, having heard only that no new money was yet agreed for Better Cities, that another proposed measure had gone backwards and only criticism of the portfolio and Howe’s vision.
It was not until the ERC cabinet decision was circulated that the minister and his office realised what we had won. Written cabinet decisions always reflect the exact words in the minister’s cabinet submission unless cabinet (or the ERC) specifically decides differently. Thus, every proposal was endorsed exactly as recommended with just two exceptions, and we had been extremely careful with the drafting of the minister’s submission. On Better Cities, the decision included the minister’s vision for the program, including that it would be a continuing one, but deferred the amount of new capital to be provided each year.
Belatedly, there was some celebration, particularly when new funds for Better Cities were also subsequently agreed.
The celebration was short-lived, as the department and the Better Cities program were abolished a year later.
For most of my time as a secretary, my minister was a member of the ERC. This can be an enormous advantage if well managed. The minister may seek departmental advice on submissions from other portfolios. When this happened, I usually did my best to provide the advice myself or drew on one or two senior officers with relevant experience. I provided Howe with advice on superannuation and tax (finding, to the Treasury’s embarrassment, significant errors in its 1995 cabinet documents) and Wooldridge with advice on education, social security, housing and defence in 1996 and 1997, with substantial assistance from Louise Morauta, another former finance officer. Wooldridge took his broader ERC responsibilities very seriously and his performance was well regarded, including by Finance and Treasury department officials. This helped him when his own portfolio was under review, though more in terms of understanding the ‘rules of the game’ than in getting any special treatment.
Table 4.2 Clearing officials from the cabinet room
Very early in 1996, Michael Wooldridge asked me how the ERC worked. I outlined the process, emphasising that it was open to the (new) Prime Minister to vary it as he wished. The minister asked in particular whether he could ask for a ministers-only discussion to canvass political aspects without officials present. I told him that was a matter he could raise with the chair, usually being the Prime Minister when health was being discussed, noting nonetheless the advantages of having officials present.
Wooldridge frequently pursued this, seeking an opportunity for ministers-only discussions after some initial debate on his budget proposals with officials present. Max Moore-Wilton in particular was not amused, for the good reasons that the debate might not be as well-informed if central agency officials were not there to question arguments presented as facts and that the cabinet decision drafted by officials subsequently might not fully reflect the subtleties of the discussion and its conclusions.
Possibly for these very reasons, Wooldridge felt the idea served him well, strengthening his capacity to win his arguments. I advised him a few years later that he was using the tactic too often and was putting at risk his relationship with the Prime Minister, who was receiving strong objections from Moore-Wilton. He told me that he accepted my advice just before another ERC meeting. Nonetheless, about half an hour into the meeting, he turned to the Prime Minister and asked for a ministers-only discussion. It was a spur-of-the-moment request and was agreed to by the Prime Minister. Moore-Wilton glared down the table at the minister and me as he rose to leave. As I also rose, the minister said quietly to me: ‘I got that wrong, didn’t I?’
Contributing to the cabinet process also entails substantial prior work with other agencies and, frequently, post-cabinet work. Interaction with other agencies often contributed to the design of the minister’s proposals and identified the key issues for debate in the cabinet room. This is articulated formally in the coordination comments in the minister’s submission to cabinet and in the Department of Finance ‘Green’ (the Finance department’s briefing for the ERC or cabinet ministers on each submission coming forward that has resource implications). Post-cabinet work can involve bilateral or trilateral deliberation to resolve differences consistent with cabinet directions or to explore additional options or to test proposals in more detail. It also involves providing regular reports to the Cabinet Implementation Unit and responses to questions raised about implementation.
Secretaries’ personal involvement in such work depends on the significance of the issues involved. It is not unusual for secretary-to-secretary discussions to resolve, or at least narrow, differences for ministerial decisions. Most of the interaction among officials, however, occurs among SES officers, and sometimes below the SES. Particularly in any post-cabinet work, it is common that the respective ministerial offices will confer to resolve matters that cannot be settled by secretaries or other officials, or to identify politically acceptable compromises. In the pre-cabinet stages, there could also be some liaison between ministerial offices, parallel to the interaction among officials, exploring the political dimensions of the different views of the portfolios.
There are many mechanisms for whole-of-government policy development and management. The advantages and disadvantages of different processes and structures are canvassed in the 2004 Management Advisory Committee report Connected Government. Secretaries’ involvement in such cross-portfolio activities is usually at the initial stages in setting the terms of reference for an exercise and at the final stages in confirming each department’s position on the emerging policy options, proposals and conclusions. It is also increasingly common for a reference group of secretaries, often chaired by the Secretary of the Department of PM&C, to oversee the work of a task force or interdepartmental committee, to ensure it is developing options that address the agenda ministers have set and that are achievable in the desired time frame. This was the model used effectively when I chaired the Prime Minister’s Task Force on Health Services Delivery in 2005.
Secretaries (and their officers) are usually required to wear two hats in these exercises. The first is in line with their statutory duty to work ‘under the minister’, representing the minister’s views and the department’s program interests. The second is to collaborate to help achieve a collective solution for the Prime Minister and the government.
Table 4.3 Task Force on Health Services Delivery
From late 2004 until mid-2005, I chaired a task force on the delivery of health services in Australia. I had a small team of very able officers, seconded from the departments of Health and Ageing, Treasury and the Prime Minister and Cabinet, working for me. We were based in the Department of the Prime Minister and Cabinet.
There was also a reference group of the secretaries from these three departments, ensuring the task force addressed the terms of reference and met the objectives of the Prime Minister. The reference group commented on outlines and drafts of the report and took responsibility for a covering cabinet memorandum to which the final report was attached. Members of the Prime Minister’s Office (PMO) attended most meetings of the reference group.
The report was nonetheless my report and I took very seriously my professional independence in preparing it (though I was directed not to consult widely). I resisted the preference of the Department of PM&C and the PMO to focus on incremental reform, believing that the terms of reference and the context in which the task force was established required me to give equal if not more attention to options for longer-term reform.
I was given the opportunity to brief the Prime Minister directly on the report and subsequently to brief the cabinet. They endorsed most of my shorter-term proposals, but baulked at my options for more fundamental reform.
I believe the structure of the exercise was a very good one and am only disappointed by the government’s decision not to publish the final report.
The Secretary of the Department of PM&C chairs a monthly meeting of portfolio secretaries plus the Public Service Commissioner. These meetings are usually of one hour’s duration and focus mostly on informing secretaries of the current policy priorities of the Prime Minister and senior ministers, and processes for handling these and other high-level matters. Sometimes particular policy issues are discussed but, in the short time available, such discussion usually focuses on identifying a suitable process for more considered study and advice to ministers within the relevant timetable. Public service management issues are also sometimes identified but, again, mostly with a view to establishing a process for more considered study.
Once a year, the Secretary of the Department of PM&C hosts a two-day retreat that allows more substantial discussion of selected emerging policy issues and of some management issues (I understand, however, there was no retreat in 2008). As a rule, the Prime Minister joins the group for a lengthy discussion of his priorities and strategies and of any concerns secretaries might wish to raise. These discussions were usually very useful, Prime Minister Howard being quite forthcoming and frank in his assessments of future policy directions on such diverse issues as privatisation, Indigenous welfare and demographic change. On occasions, however, some secretaries seemed to use the opportunity to promote themselves rather than informed and frank discussion.
Table 4.4 Bring back the biff
At one portfolio secretaries’ retreat, there was a more robust discussion than usual among secretaries and other invited agency heads of the government’s policy on information technology (IT) outsourcing. Several people argued against the mandating of such outsourcing—the Statistician, Bill McLennan, being perhaps the most outspoken. While not constraining the discussion on this occasion, Max Moore-Wilton questioned McLennan’s insistence on his statutory independence and hence his ability to ignore the government’s policy.
McLennan, a former ACT rugby front rower, finally had enough. ‘If you say that again, Max, I’ll biff you one.’
It was a most effective way of getting his argument listened to seriously by Moore-Wilton—better than my tendency to be quietly persistent or some others’ tendency just to go quiet.
Apart from these formal and regular gatherings (and those focused specifically on APS management—see Chapter 10), secretaries often meet in smaller forums, often informally, to confer on issues of shared interest. When Secretary of the Health department, I continued the practice (mentioned in Chapter 2) of Tony Blunn, former Secretary of the Department of Social Security, of hosting monthly lunches of the secretaries of the social policy departments. The heads of other related agencies such as Centrelink also became involved and the value of the gatherings proved so great to those participating that secretaries refused to drop off the invitation list when they moved away from the social policy area. As a result, the attendance at times was counterproductive to the private discussions intended.
As well as such informal forums, there is often the need for selected secretaries to meet to discuss a matter of shared interest to their ministers and to establish processes through which officials can explore the issue in more detail. Examples in the Housing department included work with the departments of Social Security and PM&C (and later The Treasury and the Finance department) on housing reform and rental assistance and with the departments of Employment and Transport on regional development and cities; examples in the Department of Health included work with the Industry department on pharmaceutical pricing and regulation, with the Department of Veterans’ Affairs on medical and pharmaceutical benefits, aged care and patient health records, with the Department of Family and Community Services on rehabilitation and health assessment services for social security clients, and with Customs, the Attorney-General’s Department and others on illicit drug strategies.