Decentralisation by default: APS must justify city offices or move out

By Stephen Easton

Thursday April 20, 2017

The federal government is now taking an ‘if not, why not?’ approach to relocating public servants for reasons of regional development as it expands the policy beyond the agriculture portfolio — but it won’t be dismantling the main organs of the public service and scattering them around the countryside.

Deputy Prime Minister Barnaby Joyce said Thursday morning the government would not move the senior executives of major departments and other key non-corporate entities like Treasury or Finance out of the national capital.

Ministers will have to take stock of the entities and functions in their portfolios and report back to Cabinet by August on which are suitable candidates for the Nationals’ push to spread the wealth from public service employment and government spending.

Agencies would need to justify “why all or part of their operations are unsuitable for decentralisation” if they don’t want to move, Regional Development Minister Fiona Nash said in a speech at the National Press Club yesterday.

‘Not moving whole departments’

The criteria haven’t been finalised. Nash said she would produce “a template for government ministers to assess which departments are suitable for decentralisation by mid-year” and expected “robust business cases for decentralisation” from the relevant ministers by December.

“We’re not moving whole departments,” said Joyce today, mentioning a few of the central agencies by name and adding he could imagine parts of the Department of Agriculture moving out of Canberra but not the whole organisation.

The DPM focused on selling the benefits of moving to regional centres — affordable houses and lack of congestion — and argued these centres would become even better places to live as their populations grew. Nash talked up the value of public servants living and spending money in regional centres, putting their children in the local school or joining a volunteer bush fire brigade.

“It also creates more career opportunities for our children to enable them to stay in the communities they grew up in,” Nash said. “Those careers will help lure some of our young guns back to the bush as well as some city people to our regions, relieving the burden on our bursting capital cities.”

Joyce doubled down on his previous disdain for cost-benefit analysis in deciding which public service teams should stay and which should go. He argued that Canberra would never have been built if it had to pass a cost-benefit analysis in 1913, and federal Parliament would have stayed in Melbourne. New Year’s fireworks shows and the Opera House would not have passed a cost-benefit study either, he claimed in the press conference.

The Nationals leader has led by example with the relocation of several agencies in his portfolio, and attracted criticism for the heavily scrutinised decision to move the Australian Pesticides and Veterinary Medicines Authority from Canberra to Armidale, a large centre in his New South Wales electorate.

Cost-benefit not the driver

Joyce resisted releasing the cost-benefit review in that case and freely admitted it found far more costs than benefits. The analysis found the move would detract from the effectiveness of the APVMA — which relies on specialist scientists who are in short supply — with large flow-on costs to the industry it regulates and the agriculture industry.

Today he argued again the APVMA move was an example of the government working out a relocation that would work well, because the University of New England offers rural science courses in Armidale.

The relocation was opposed by a significant group of stakeholders including the National Farmers’ Federation, which supports decentralisation in general, and CropLife, a peak body representing the agricultural chemicals and plant science industry that believes the agency’s most recent KPIs suggest its performance is already being affected.

Nash said on Tuesday the new assessment template would mean a “consistent approach across government” in the forthcoming decisions about which jobs stay, and which move to regional areas. Whether the current occupants move with them is a key issue that has been raised by the APVMA debate and has cruelled other public service decentralisation plans in the past.

The Rural Industries Research and Development Corporation had to replace a lot of staff as a result of its move to Wagga Wagga. The Murray-Darling Basin Authority, on the other hand, cheerfully announced its decentralisation plans aimed to improve communications and engagement with communities in the vast water catchment area.

Standard words come back to bite

Yesterday, someone from the APVMA leaked a set of talking points given to all staff before Easter, suggesting they should keep mum about their own intentions and simply tell family and friends “for the moment I’m getting on with the job”. Today the internal resistance to the relocation promptly leaked another message, warning that leaking the first was a code of conduct violation.

Joyce has also been credibly accused of pork-barrelling via the first round of decentralisation in his portfolio, and Canberra’s past voting patterns mean there would be little for the Coalition to lose from upsetting its residents, but he again denied that was the case today.

Reasonable support for public service decentralisation as a form of regional development can be found in submissions to a Senate inquiry that has helped keep the APVMA relocation in the spotlight, alongside many strong arguments against decentralisation.

Among the country folk who heeded Joyce’s call to put their hands up for some public servants to come their way were “many from Labor electorates” according to the DPM.

Several local branches of Regional Development Australia also dutifully barracked for their regions — including the ACT branch, which points out Canberra is a regional centre itself and a lot of smaller surrounding communities currently benefit from its large public sector economy.

Calm down, Canberra

Joyce and his colleagues have been able to marshal significant support for decentralisation, and the rural voters they represent almost certainly place economic development in their towns far above any concerns about effective public administration. This explains why the DPM appears to consider the value of public service teams as economic units and regional vote-winners above any operational problems or costs that might result from relocation.

Decentralisation has plenty of supporters, including The Mandarin’s publisher Tom Burton, who argues government policies to encourage growth outside of crowded cities with unaffordable houses and overloaded services should be a no-brainer. Nash said she was also working on a “long-term project” of encouraging “corporate decentralisation” among other regional development initiatives.

“While people are stuck in traffic on Melbourne’s Monash tollway or Sydney’s M7, country people are getting to work in five minutes and parking out the front of their favourite restaurants,” she said. “Shifting to the country makes sense both for government departments and capital city residents.”

This argument doesn’t work nearly as well for Canberra, where 37% of the APS is still located and the peak-hour traffic congestion makes Sydneysiders say, ‘What? Was that it?’

No other location has more federal public servants, but 63% already work somewhere else, including 86.8% of the Department of Human Services, 87.9% of the Tax Office, 67.8% of the Department of Veterans’ Affairs, 99.3% of Australian Securities and Investments Commission staff, 94.5% of the Bureau of Meteorology and 90% of the National Disability Insurance Agency.

ACT chief minister Andrew Barr hopes this means most of the APS jobs that move out to the regions will come from “the big states” which would avoid “undermining the core purpose of the national capital or the effectiveness of public administration”.

Canberran politicians from Joyce’s side of the aisle seemed more worried by Nash’s Press Club speech than Barr. Opposition leader Alistair Coe and ACT Senator Zed Seselja both spoke out immediately against any move to reduce Canberra’s role.

Joyce moved to calm this instant backlash today, referring to Canberra as “this great city, this incredibly beautiful city” and saying he expected its economic growth would continue “flat out” into the future.

This raises the question of where the government draws the line between regional centres that deserve a bigger slice of economic activity and “bursting capital cities” that have had more than enough already. No new jobs are being created, and one community’s gain is another’s loss in this case.

The purpose-built seat of the Australian government is today not much bigger than Newcastle, but on the other hand this makes it a fair bit bigger than Hobart and Darwin. Its public servants have poured a lot of money into nearby rural areas over the years, but other communities want a slice of the action too.

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