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A top-heavy APS? The tide is turning on classification creep

Over the past 15 years, the Australian Public Service has grown increasingly top-heavy. The same long-term trend has been reported every six months since 2006, when the APS Commission’s statistical reports started including data from that long ago, but has been in motion since the 1990s.

The commission has also provided the same broad analysis of this trend, year on year: the APS has become an increasingly skilled workforce, performing more complex and difficult roles; technological change has rapidly reduced the need for low-skilled positions while most of the simpler jobs that are still required have been outsourced.

But something else has been going on at the same time — classification creep, where the same jobs are performed by higher-level employees. Following recognition of the problem in the 2010 reform roadmap Ahead of the Game, steps are being taken to address it. There are signs it’s working.

The recent 2013-14 statistical bulletin shows EL1 and EL2 staff declined as a proportion of the whole by a combined 0.4% over the past year — not much, but it’s the first time that’s happened for years. Still, the percentage of federal public servants at the two levels below, APS5 and APS6, continued to increase very slightly.

Ahead of the Game introduced a cap on senior executive service numbers ahead of a review of the SES by former departmental head Roger Beale, then principal of PricewaterhouseCoopers. On Beale’s advice, the cap was extended to 2016 and mandatory work level standards for the SES are now in place. The APSC says all of his 14 recommendations “have now been implemented or are ongoing”.

Beale identified “clear forces driving much of this growth” that must be addressed to turn it around:

  • Growth in the complexity of work expected of the APS and the number of programs administered;
  • Significantly greater demands for interaction with and response to stakeholders, including both ministers and their offices, other levels of government and business and the community more broadly; and
  • The impact of information communications technology and the 24/7 media cycle on the response time for requests and provision of advice, including the extension of the “working day” — 42% of SES staff work 50 hours or more per week.

According to Terry Moran, the immediate past secretary of the Department of Prime Minister and Cabinet (and a Mandarin editorial advisory board member), classification creep began during the John Howard years. He says the government stopped insisting that new jobs be reliably assessed for their work value.

In 2013, the APSC undertook a review of the overall APS classification structure. All of its recommendations have also “now been implemented or are ongoing”, according to the APSC. New service-wide work level standards and a classification guide were published last year.

The review identified a range of problems in the current system leading to classification creep. Human resources teams often lacked the ability to evaluate jobs and make classification decisions themselves, leading them to outsource the work to consultants. Job classifications were also being decided for the purpose of attraction and retention or, conversely, affordability, “as opposed to the outcomes required of a role”. It also noted a perception that “between agencies there are different expectations of work value at each classification level”.

Agencies also reported it had become difficult to define the difference between APS6 and EL1 jobs and that “where there is not a strong culture of assessing work value or where there is an absence of clear guidance, there is a tendency for managers to apply a higher classification”.

Australian National University public policy professor Andrew Podger told The Mandarin past analysis led him to conclude that while the SES had grown too rapidly, the decline of APS1 and APS2 positions at the opposite end “has been way too dramatic”. This, he says, reflects “not only that much work is now being done at way too high an hourly rate, but also that bridges into the APS for indigenous people and people with a disability have been closed off”.

Graduate recruits, who start around APS3 and APS4, are also being promoted far too quickly, according to Podger, and end up adding to the excess of EL1 and EL2 positions. “The shift to a graduate service was inevitable and generally appropriate, but we are no longer distinguishing between the bulk of recruits and the selection of the genuinely best and brightest,” he said.

Government pork and growth of SES

Moran recalls that the governments of Howard, Kevin Rudd and Julia Gillard “set up all sorts of very small programs for putting grants out into the community”, which led to a bloat in the number of mid-level EL1 and EL2 staff working in an increasingly fragmented bureaucracy. The Beale review found the inordinate growth of SES roles was also correlated with growth in the number of separate Commonwealth programs:

“Since 2003 there has been an increasing tendency for the Australian Government to wish to deliver programs directly to the Australian people, bypassing the States and Territories. In all western democracies, there has been a proliferation of programs targeted at increasingly narrow demographic and geographic interest groups in the community. This is regarded as clever electoral politics. But it comes at a price in terms of administrative costs, risk and in particular growth in senior public service numbers in all our comparator political systems.”

Moran points to the Abbott government’s move to consolidate over 150 small indigenous affairs programs into five broad initiatives as an example of recent reform to simplify the bureaucracy.

“From the community’s point of view, they don’t have to be writing out a myriad of program proposals to get small amounts of money,” he told The Mandarin. “Instead, they could focus on a smaller number of well worked-up proposals against those five programs. And secondly, the number of people in Canberra required to administer those programs is less — so the administrative overheads are less. The reduction there should be amongst the people at EL1 and EL2 level.”

“You can understand the political reason but it’s very expensive and fairly corrosive of the federation apart from anything else.”

Federal politicians clearly face pressure to be seen delivering programs directly, in order to maintain a high degree of visibility in their electorates. “You can understand the political reason but it’s very expensive and fairly corrosive of the federation apart from anything else,” Beale said.

“This development of many little programs is a form of narrowcasting as distinct from broadcasting. It’s an attempt to buy votes on a micro scale, to pick out individual places and small groups of people.”

The Coalition government portrays initiatives like Community Development Grants and the National Stronger Regions Fund as the right way to directly deliver Commonwealth largesse in contrast to Labor’s bungled attempts at pork barrelling. But sceptical observers see far more similarities than differences with the programs they replaced.

Cutting SES numbers would have almost no effect on the overall federal budget. According to Beale and Moran, the main issue is that government has become overly complex and inefficient, with programs regularly costing more to administer than the benefits they deliver. The aim should be for much broader spans of responsibility and a simplification of program structures, with more funding left to the states and territories to administer.

In his report, Beale recommended that “any program for overall reduction in SES numbers be linked with fiscal and/or program consolidation and be managed actively to ensure that the right people remain and the capacity of the APS is not compromised”.

Podger suggests the Abbott government’s focus on cost-cutting may stymie more effective public sector reform.

“I appreciate that the APSC is doing its best to address the problems but I fear the government’s general attack on APS pay will leave little room for a more nuanced response, focused on redesigning jobs and career progression, that would reduce average pay rates while allowing proper increases where warranted by the market,” he said.

Author Bio

Stephen Easton

Stephen Easton is a journalist at The Mandarin based in Canberra. He's previously reported for Canberra CityNews and worked on industry titles for The Intermedia Group.