Table of Contents
While addressing the National Press Club in 2006 about claims that public servants had been politicised, Peter Shergold did not dispute the nature of their behaviour, only the reasoning behind it:
Public servants, it is suggested, now willingly do what governments require of them because they are politicised. In fact they do it because they remain steadfastly apolitical. They would do it for any government.[1]
The question is whether this is the good news or the bad news. For those who question whether public servants may be ‘so concerned to serve the government of the day … that the urge to serve overpower[s] the need to be critical,’[2] the argument that they would do the same for any government on any day is hardly reassuring. It suggests that ‘willingness to perform’ is the default position of public servants regardless of what is asked of them.
Individual performance management, performance assessment and performance pay were eminent in the suite of private sector strategies introduced following RCAGA and subsequent public sector reviews as a means of fusing efficiency and responsiveness. The Management Advisory Committee urged the historical inevitability of these developments in its Performance Management in the Australian Public Service with the hindsight of 2001:
Through the 1980s a wave of reform in public administration engaged the APS with trends in management thinking, including from the private sector. Significant among these trends was an increasing focus on managing by outcomes and accountability of agencies for improving management and performance. This coincided with a renewed interest in performance management.[3]
In order to ensure that efficiency gains were diligently pursued, management for improved agency performance was to be reinforced by a second focus on managing individual performance. Between 1992 and 1996 the Labor Government oversaw a highly standardised and centralised approach to performance-based pay, which was limited to the senior executive service and senior officers. Arrangements for merit pay under the Coalition Government elected in 1996 were introduced in conjunction with the first round of agency agreement making conducted under the Workplace Relations Act 1996. These provided for greater experimentation with performance management and compensation processes at the agency level, and included all APS employees.[4] This focus on individual performance was to be linked to agency performance by identifying individual performance goals with specified organisational performance outputs and outcomes endorsed by the minister. By the time of Dr Shergold’s comment above, most public servants had been advised that their organisation either had or was growing a performance culture, and nearly all agencies had individual performance agreement and assessment systems to help hone the individual and collective willingness of their staff to focus on achieving results agreed with government.[5]
Nevertheless, while performance management itself has been critical to public sector reform, and while individual performance management, assessment and pay followed from it, experience suggests that the latter has not been successful. As will be seen, public servants who have improved their productivity do not rate it at all highly as a factor contributing to that improvement.[6] A 2004 Audit Report into its operation found that ‘that staff do not see the performance management system as a valid tool to gauge their own performance.’[7] Rates of dissatisfaction with underperformance remain high despite performance management and assessment systems: only 11 per cent of staff responding to the ANAO’s audit survey considered that under-performance was effectively managed in their agency; nearly 70 per cent considered that this was not the case.[8] More importantly, its impact on the agency culture is questionable: the ANAO reported employees’ perceptions of ‘a substantial gap between the rhetoric and the reality’[9] in agency systems. The State of the Service Employee Surveys, as will be seen, raise issues about the impact of performance assessment and pay regimes on a culture in which employees are able to work together effectively. Most importantly, they also raise questions about their contribution to a culture that upholds the APS Values. In 2005–06, only 37 per cent of staff agreed that, in their experience, the performance pay system in their agency contributed to a workplace culture that upholds the APS Values—and this was the highest percentage ever found by the Employee Survey.[10]
Section 10(1)(k) of the Public Service Act includes a focus on ‘achieving results and managing performance’ among the APS Values. This is one of the NPM-inspired values. Its purpose is to ensure that, to the extent that this is not already the case, public servants lift their eyes above purely process issues and in so doing find ways of increasing their capacity to deliver on the government’s policy objectives. Increases in efficiency and effectiveness are anticipated as a result of operating in a more flexible and less rules-based environment, and as a result of the encouragement to think creatively about changes that might be made to processes in order to deliver agreed outputs more quickly or more comprehensively. Public servants are to set less store by the means and greater store by the ends. In so doing, agencies are to bear in mind the broader ethical framework established by other APS Values in which they are to operate, and to strike what the then Auditor-General called the ‘appropriate balance between conformance and performance.’[11]
It is important to the overall functioning of the service that when public servants lift their eyes above process issues they see how their work fits into the objectives of the organisation as a whole. In the course of preparing its 2001 guidance on Performance Management in the Australian Public Service, the Management Advisory Committee had undertaken interviews with a number of private sector executives ‘(mostly CEOs)’ about their experience with and reflections on performance management. These interviews reinforced its own views, firstly, that private sector CEOs often faced ‘the same challenges that their public sector peers face’, and secondly, that these challenges included the means of establishing ‘a clear “line of sight” between the business plans and corporate strategies and staff performance contracts’.[12] For both private and public sector performance management to work, it was felt that performance management plans should be seen to ‘cascade down’ from organisational to individual goals in order to establish the link between managing for results and managing individual performance. Experience in the private sector also suggested that individual performance management and assessment would increase efficiency and effectiveness in two ways: firstly, by giving individual public servants a sense of how their work fit in with the whole and, secondly, by giving managers the carrot of performance pay and the stick of under-performance proceedings.[13]
[1] Peter Shergold, ‘Pride in Public Service’, speech to National Press Club, Canberra, 15 Feb. 2006, at http://www.pmc.gov.au/speeches/index, viewed 15 Mar. 2006.
[2] Patrick Weller, Don’t Tell the Prime Minister (Scribe Publications: Melbourne, 2002), 69.
[3] Management Advisory Committee, Performance Management in the Australian Public Service: A Strategic Framework (Canberra, 2001), 17.
[4] See Michael O’Donnell and John O’Brien, ‘Performance-based Pay in the Australian Public Service: Employee Perspectives’, Review of Public Personnel Administration 20 (2000).
[5] ‘In 92% of agencies it is mandatory for all employees to have a formal performance agreement’: Public Service Commissioner, 2005–06 State of the Service Report (Canberra, 2006), 162.
[6] Australian Public Service Commission, State of the Service Employee Survey Results 2004–05 (Canberra, 2005), 42, question 64b. Employees who did not report having improved productivity were included the following year, with only marginally improved results. See Australian Public Service Commission, 2005-06 State of the Service Employee Survey Results (Canberra, 2006), 46 question 62b.
[7] Australian National Audit Office, Performance Management in the Australian Public Service, ANAO Audit Report No 6, 2004–05 (Canberra, 2004), 84, para 6.36, at http://www.anao.gov.au/uploads/documents/2004-05_Audit_Report_6.pdf, viewed 23 July 2007.
[8] Ibid. 64, para 4.56.
[9] Ibid.14, para 9.
[10] Australian Public Service Commission, 2005-06 State of the Service Employee Survey Results, 50, question 70.
[11] Pat Barrett, ‘Auditing in a Changing Government Environment’, paper based on a lecture presented in the Department of the Senate Occasional Lecture Series, 21 June 2002, p. 84, at http://www.aph.gov.au/Senate/pubs/pops/pop39/c05.pdf, viewed 4 July 2007.
[12] Management Advisory Committee, Performance Management, 18.
[13] Ibid.14.