Reflections turn to farewells for Michael Thawley

By Stephen Easton

Thursday December 10, 2015

Every good idea has its day, says Michael Thawley, the outgoing head of the Australian Public Service. If one word could summarise his ambition for the APS, it’s “ideas”.

He knew he was getting somewhere when he was coming back from the nearby coffee shop and a “young chap” rang up to ask if he had 10 seconds to hear his exciting new idea.

The secretary of the Department of Prime Minister and Cabinet dropped the comments into a wide-ranging speech to the Institute of Public Administration Australia, ACT Division on Wednesday night. Originally intended as a simple reflection on a year in the job, Thawley said the address became “an important occasion” after he tendered his resignation last week to make way for Martin Parkinson’s return from the wilderness.

“In the United States, failure is the first step towards redemption.”

“When I agreed to do this speech I didn’t know it was to be my first and last end-of-year speech … I want to start by saying how immensely lucky and privileged I feel to have held this office. It’s been the highlight of my career,” he said.

It may have been a short stint, but it was “exciting, satisfying and a lot of fun” to be the nation’s most powerful bureaucrat. Even if it did involve getting a little out of his comfort zone:

“I come from that school of public servant, sort of a bit out of date I’m afraid, that firmly believes that your power and influence is inversely proportional to the amount you appear in the media, and so my firm intention was never to say anything to anyone publicly, but somehow I seem to keep appearing at IPAA events!”

Thawley said he would leave with “renewed admiration for the professionalism of public servants” and undented pride in the profession.

Michael Thawley
Michael Thawley

Apolitical and impartial

“Of course it is essential that we are non-partisan,” said Thawley, musing on what it means to be apolitical. “In my experience, public servants will go for the most pragmatic and effective solution to a problem, regardless of any party affiliation.”

He thinks the role of the public service is more important than ever as the political system becomes increasingly volatile:

“We provide the continuity. …We can look at the issues dispassionately from the point of view of the country as a whole. We should know from experience how often unintended consequences attend well intentioned reforms. Think about the history of the disability pension, the perverse effects of some indigenous policies, and vocational education reforms.”

He said the obligation on the public service was two-fold: “First, we can’t just tell governments why policies won’t work. We have to make suggestions that will solve the problem and are feasible, not merely propositions an economics professor or a commentator might endorse.”

Second, public servants must keep pushing those ideas “energetically” and remember that every good idea has its day, Thawley added.

“Overly hierarchical structure risks dissatisfied employees, abrogation of responsibility, and slow decisions.”

“It’s no use shrugging our shoulders if the minister or government rejects our proposal. Why did we fail? Was our evidence lacking? Was our argument weak? Did we fail to win over stakeholders and create a coalition of the willing?

“We have to care enough about our ideas to think them through carefully, and persuade people to take them up.”

He repeated his guidance from earlier in the year to always be clear and concise, to tell ministers what they need to hear, not just what they want to hear, and leave the politics to them as he was personally told by former prime minister John Howard.

“How things are implemented is our responsibility,” Thawley added.

“We have to ask ourselves why we did not bell the cat earlier about the NBN’s impossible targets, or about … increased spending on an education policy that overall, set our children back rather than improved their results. Our share of responsibility in the tragic mistake of the Rudd government’s home insulation scheme has emerged from a royal commission.

“When things aren’t working we should be quick to adjust our approach and try something else.”

Dream big like Americans

Introducing the speech as IPAA ACT Division president, Glenys Beauchamp could not hide her excitement about this week’s Innovation and Science Agenda and the central role it has bestowed upon the department she leads.

The PM&C boss said also gave it a big tick, saying that governments needed to encourage entrepreneurship to grow the economy, along with prudent budgetary management and avoiding “counter-productive” taxation.

“This is partly a cultural matter,” he said, going back to his experience in America. “In the United States, failure is the first step towards redemption. Here, failure is more likely to be forever down, and possibly kicked.”

The Innovation Statement is a very good start but it needs to be followed by large-scale tax reform, better infrastructure and “structures and regulations that encourage competitiveness and productivity” as well as improved healthcare and education, in Thawley’s view.

“The public service must help shape this agenda and keep the focus on it,” he said.

Asked later by a Defence employee what PM&C had done to encourage a culture that gives staff “permission to fail”, Thawley said it hadn’t been hard because his staff were already willing to speak their minds.

He believes “listening is the key thing” and it is important to give staff the confidence to explain their ideas and improve their arguments:

“That’s our job; you know, we’re meant to be mentors and help people make the best of their ideas.

“And of course when something goes wrong … it’s the job of the manager to take the hit. You need to protect your people … until they’re ready. They need to be given the confidence to speak their mind and to have a go at an issue.”

Administrative assistance

There was no last minute backing down from his strong belief freedom of information legislation is undermining the political system.

“Unintended use of FOI puts pressure on frank exchanges of trust between the public service and government, and hence is a risk to good government,” Thawley said.

He later added that “recruitment procedures and criteria are so arcane that only the initiated understand” and explained that simplifying them in PM&C had “produced startling results” with a better and more diverse field of candidates sending applying.

Thawley is in step with APS commissioner Lloyd on a range of other issues too. He agrees that underperformance is not managed well enough and that’s a “big problem” in the APS, and said he and LLoyd both thought performance underperformance management procedures should be simplified.

Mainly, however, the departing PM&C secretary thinks managers need to start following the processes that already exist more diligently, so it is not a sudden surprise when staff are advised they are not meeting the requirements of the job.

He supports efforts to erode the unofficial boundary between private and public sectors through recruitment procedures that aim to attract more outsiders and secondments in the other direction. And he urged more bureaucrats to be brave and consider doing something different for five or 10 years.

Silos within and between different governments should continue being broken down, but the most important strand of management reform for Thawley is pushing authority down to the lowest and most local level possible, with the minimum oversight necessary:

“An overly hierarchical structure risks dissatisfied employees, abrogation of responsibility, and slow decisions.

“All organisations are different and there’s no single rule about the best number of levels in organisations and the delegation of powers, but our guiding principle must be to give people at every level the opportunity and confidence to maximise the contribution they can make.”

The new associate secretary in charge of indigenous affairs in PM&C, Andrew Tongue, was making a “concerted effort” to do that, he added, and the Prime Minister wanted to hear advice from whoever knows best, whatever their level.

After a “tumultuous year, by any measure” he closed with what he called his “last will and testament” implying a return to the APS is not on his mind:

“I encourage you all to have ideas and fight for them until they become reality. Have courage in your convictions and say what you think. Be ambitious for Australia. Keep your doors open and push on every door in the service of the nation. There is no more honourable mission.”

Wealth and power the only safe bet

Along with his pearls of administrative wisdom, Thawley gave the nation’s leaders some serious advice to chew on. Falling back on his forte — international relations — he repeated a view he expressed in the 2005 Sir Robert Menzies Lecture:

“I argued … that if only we chose, we could become a much greater and more powerful nation. And, that we had an obligation to do so in our own interests, and in the interests of our region. I’m just as convinced now that this is true.”

Australia’s continuing development “depends to a great extent” on the quality of its public servants, he said. While ministers make the final decisions, it is up to the bureaucrats in the background to articulate “what Australia might become” and the consequences of different options for government. The public service could contribute “experience as to what works and what does not” as well as specialist expertise and creative solutions.

“And of course our professional skills are needed if announcements are to be turned into real life,” Thawley added.

In a world of risk and uncertainty, the only safe bet is to increase Australia’s population, wealth and defence capability to become a “strategic price-setter” rather than a “price-taker”, he argued. Having “powered through the largest financial and economic crisis since the depression” Thawley believes Australia needs to seize the opportunity of growing markets in India and China.

But the world economy is still fragile with flat global demand and impending interest rate rises, he said, and even though China’s growth had “transformed lives” and stimulated demand for decades, its “economic and political transitions are not at all straightforward”.

“Economically, Australia has to ensure that we are strong enough to take best advantage of the opportunities to build prosperous lives for our growing population while withstanding any new shocks,” the international relations expert said.

Thawley pointed to uncertainty about both China’s aims and the “will and capacity” of the US to continue playing a “stabilising global role”, as well as the ambitions of Russia and fault lines re-appearing in Europe as risks to regional and global stability. Japan and Germany were “stepping out from their political and strategic reticence” of the last 70 years, with India jostling to join them as a global player.

“Turmoil and terrorism caused by the religious and power struggles in the Middle East may continue for decades and we have ahead of us the inevitable re-shaping of the Korean peninsula,” he warned.

“The choice we face is not between China and the US, but between stability and instability.”

The breakdown of the world order defined by US primacy would vastly increase the cost of defence, said Thawley, arguing that Australia could best contribute to a peaceful and prosperous world by becoming richer and stronger itself.

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