Tom Burton: why government needs to reshape itself

By Tom Burton

July 1, 2016

Government needs to deeply reform itself, if it is to be relevant in the modern era. The reform needs a fundamental change in the way government is designed and operates.

For a sector that occupies nearly 30% of the economy, there has been remarkably little discussion in this election campaign about the role and shape of the public sector.

At a time of widespread and deep disenchantment with the effectiveness of governments around the developed world, there has been barely a blip about what sort of public sector will serve us best in the coming decades.

Rapid technological development is driving arguably the most profound changes since the industrial revolution. But there is little evidence of the sort of fundamental rethinking about the core operating model that will be needed if government is to regain its relevance.

“Large, clunky, innately secretive, risk averse … we seem to have an operating model of government not fit to play an effective role in these times of major challenge and opportunity.”

The Australian public sector seems stuck in a largely post-war model — broadly copied from a Westminster system that served the United Kingdom well when it ran a global empire. The unkind view, from the balcony I sit at looks like this: large, clunky, innately secretive, risk-averse specialised agencies, narrowly appropriated to solve and regulate problems and deliver services that typically span multiple agencies and multiple jurisdictions.

There are many public sector leaders seeking to bring modern approaches and changes to their individual agencies and departments — Victorian Premier’s Secretary, Chris Eccles’ program of changes and speech this week on the role of government being a good example. But  in the broad we seem to have an operating model of government not fit to play an effective role in these times of major challenge and opportunity.

Government in Australia is a $400 billion platform. Yet the concern and belief of many I talk to inside the sector is that at the organisational, delivery and external level, the model is simply not returning that value — and more — to the broader nation.

The very real likelihood of another decade of fiscal deficits is driving some rethinking  — the most profound being the long overdue digitisation of basic services and associated transformation programs (NSW has just closed down 494 fax lines!). But much of this is cleaning up  a decade of appalling badly designed web sites and apps and there appears to be few built-in incentives to drive deeper systemic change and reform.

Government has no market mechanisms to signal failing relevance or effectiveness. With only occasional audits and functional reviews to clean out the most obviously ineffective programs, agencies are largely left to fight among themselves for ownership of appropriations and programs. Well remunerated by anyone’s standards, there is little personal incentive to challenge the system or admit a program or agency should be retired.

“The biggest challenge lies at the heart of the public sector model.”

It probably has been forever so. But while there has been major productivity and workplace reform outside of government, within the comfortable halls of the bureaucracy work practices have altered little since the end of the typing pools. Decision making remains treacle-like in almost any agency I ask about, with extraordinary multiples of sign offs, rewrites and approvals.

The Commonwealth’s Belcher red tape review promises some changes, but the reality is a deep lack of professional trust means the dreams of an agile and innovative public sector are fantasy. Louise Hand’s recent video on red tape reduction at the Department of Foreign Affairs and Trade is a fabulous piece of change management and advocacy, but also revealed how endemic many of the public sector’s worst bureaucratic practices are.

Phones and desktop computers are disappearing from non-government workplaces, real-time editing (like with Google Docs) and delegated approvals are fast becoming the norm and many white-collar organisations are moving to a system of giving staff unlimited leave. But government is resolutely hanging onto mega-offices, deeply administrative pay classifications and HR practices of the ’70s.

This may seem administrative trivia in the scheme of things, but it is symptomatic of a culture and mindset that pervades the middle band of the bureaucracy. Caught between a highly risk-averse senior executive group and a phalanx of processes, systems and faux reporting, this middle group are not trusted enough to get on with their work. This is exactly what Louise Hand’s video identified.

“The payoffs for government are huge.”

Hand’s video is also a pointer to another deep issue. At a time where technologically empowered citizens are demanding to be involved and engaged with their governments, we have risk-averse executives largely unwilling and unable to become part of the public discourse. Governments are being literally eaten up and spat out by the new world of social media, yet we still have the vast majority of senior bureaucrats unwilling to front up for their agencies in a consistent and proactive way.

You can have as many social media folk and big ad campaigns as you like, but without an SES officer leading the way in public engagement, it will just be a sideshow. Which, at worst, leaves agencies inward-facing, tepid and frankly roadkill in a modern open internet world.

The same goes to decision making and transformation. At a time where collaboration and co-design are becoming the foundation for modern eco-system, product and service development, the deep seated secrecy endemic in the upper levels of all the jurisdictions, (South Australia perhaps the exception), reveals again an insular culture stuck in a prior world.

In New Zealand, cabinet documents associated with major decisions like the budget are released after six weeks. In Canberra it is 30 years! I have sympathy for PM&C chief Martin Parkinson’s call for some space to deliberate in privacy, but the world has dramatically changed. The idea of a closed-door, FOI-free space for fearless advice continues to promote a top-down authoritarian model that every indicator suggests is simply not working for our citizens.

The slow, but now steady, change to a more outcomes-based approach that Eccles highlighted suggests a renewed and welcome focus on effectiveness, evidence and empiricism. However a quick look at the outcomes statements of the nearly 900 federal agencies also reveals we have a long way to go: well-meaning statements of intent would be the benevolent view; others would describe them as waffle and bureaucratic obtuseness.

After the 2013 National Commission of Audit noted how weak the Commonwealth’s reporting and accountability system is, the Department of Finance has done a lot of work to rejig the public reporting system. But in several months we will yet again see truckloads of printed annual reports littered around Parliament House. The waste of tax money producing glossy print reports for 900 agencies is symptomatic of a system moving snail-like into the digital world. At a time where we have the capacity to deliver real-time metrics across government through agency websites, endless hours are devoted to self-promoting reports that are read by virtually no one.

There are of course differences across the governments. NSW — easily the most progressive of the state and federal administrations — now has real-time data being delivered directly to the Premier’s office. Mike Baird can now answer the question no other Australian chief minister can: how did my government perform yesterday?

The biggest challenge however lies at the heart of the public sector model. It is a challenging thought, but if we were starting government again we almost certainly would not have agencies and departments running a whole fleet of buses, trains and trams — nor hospitals — and probably not even schools and universities. Nor a massive tax collection agency or a bureau full of meteorologists or a network of post offices.

Just as Uber runs a large transport network with no cars of its own, and AirBnB a huge suite of accommodation without any of its own houses and apartments, government now has the opportunity to run similar powerful algorithmic platforms for its core services.

At the heart this model is government running a powerful data layer powered by algorithms that direct and control resources, be it to collect rubbish, manage energy usage, deploy emergency services or triage traffic flows.

In this scenario these algorithms are the core enabler to a far more intelligent government, a platform that uses real-time structured and unstructured data across multiple sources.

The payoffs for government are huge. Just take one example: nearly three quarters of our annual infrastructure spend is to solve congestion problems. A system that dynamically manages usage through a combination of ride sharing, surge capacity in public transport, congestion pricing and alternative routing would offer real alternatives to building more and more road and transit systems.

In this world Governments have real choices where they want to play — at the infrastructure, data, or provider level — and well chosen can get real leverage for their efforts in collaboration with the broader economy.

But while alluring and deeply transformative as a model, it is simply dream land stuff, given the deeply siloed way government agencies operate and are funded. To tackle problems like obesity, domestic violence, suicide and endemic incarceration requires a response which has a singular focus and, frankly, a vehicle unbridled by the bureaucratic fiefdoms and rules that logjam virtually every attempt to radically change the approach to government.

Ironically these constraints do not exist offshore, where the federal government is much more willing to use innovative external providers to tackle some of the deeper development issues in our region.

This system design issue is a central agency challenge and with some rare exceptions, I am simply not seeing the sort of deep policy thinking needed to both challenge and drive the fundamental change the system needs, if it is to be effective and relevant in this next era.

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