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Please find attached a submission by the Governance Institute of Australia Limited.

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Mr David Thodey AO


The panel for the review of the Australian Public Service

Department of the Prime Minister and Cabinet

PO Box 6500

Canberra ACT 2600

Via upload

Dear Mr Thodey

Independent review of the Australian Public Service

Governance Institute of Australia (Governance Institute) is the only independent professional

association with a sole focus on whole-of-organisation governance. Our education, support and

networking opportunities for directors, company secretaries, governance professionals and risk

managers are unrivalled.

Our members have primary responsibility to develop and implement governance frameworks in

public listed, unlisted and private companies, as well as not-for-profit organisations (NFPs) and

the public sector. Governance Institute is a national provider of governance training.

We welcome the opportunity to provide feedback on the Independent review of the Australian

Public Service and are interested in engaging further with the panel as it continues with its


Governance Institute has long advocated for good governance practice in the public sector and

has developed significant resources and intellectual property in the area of public sector

governance. In April 2016 we published our Governance Principles for boards of public sector

entities. A link to that publication is here;
https://www.governanceinstitute.com.au/media/882831/tb_public_sector_governace.pdf. The

Principles recognize that for public sector governance, one size does not fit all and are designed

to be applicable to the various types of public sector entities that exist.

Governance Institute has a range of Good Governance Guides aimed at the public sector

including a publicly available public sector starter pack which includes guidance on the following

 Achieving governance in organisations without boards
 Due diligence for candidates for public sector boards
 Government businesses — delegations of authority
 Issues to consider when recording and circulating minutes of directors' meetings
 Public sector entities — conflicts of interest and related party transactions

The link to this material which is located on Governance Institute’s website


As part of Governance Institute's commitment to an ongoing improvement of governance

practice across all sectors, we conduct research on issues relating to governance practices and

trends, and issues arising in governance, risk and compliance.

Sydney | Melbourne | Brisbane | Adelaide | Perth
Governance Institute of Australia Ltd ABN 49 008 615 950

This research is intended to provide definitive statistical information and trends on governance

and risk management practice in Australia that can be used to support calls for legislative or

regulatory reform. It is also to report the views of members on important topical issues, so that

Governance Institute can advocate on behalf of its members on the development of governance

and risk management approaches. Governance Institute, in partnership with our international

affiliates, recently conducted a survey on minuting practices. The report on the results of the

survey of Australian practitioners, Survey on the practice of minutes — Report on results, has

recently been released and is available to our members. Please let us know if you would like to

be provided with this publication.

We note that the review panel proposes to examine the capability, culture and operating model

of the Australian Public Service which will best serve Australia.

Culture, accountability and transparency

Organisational culture is an important aspect of the review. Governance Institute recently

partnered with The Institute of Internal Auditors, The Ethics Centre and Chartered Accountants

Australia and New Zealand to develop Managing culture: A good practice guide .The concepts

expressed in the culture guide are equally applicable to the public sector. A link to the

publication can be found


An issue associated with culture which is often not well articulated is accountability.
Accountability is one of the key components of governance, along with integrity, stewardship

and risk management. The failure of accountability is a common theme when issues arise with

both the public and private sectors. Two recent reports are of particular relevance on this point

and we commend them to the Panel.

In December 2013 the Victorian Ombudsman presented to Parliament a report on ‘A review of

the governance of public sector boards’. The report succinctly summarised the governance risks

of public sector boards. This report followed years of adverse reports on the performance of

some public sector boards in Victoria. The report stated:

“Boards, however, can and do present certain risks to the State. My investigation identified a

range of areas of risk to the good governance of boards, including increasingly complex entity

structures and governance arrangements; variable understandings and views about the level of

autonomy from government granted to boards; the poor availability of data on the number of

boards in existence and their cost to the State; and a lack of clarity, or perceived lack of clarity,
around internal and external accountabilities.’

The Institute for Government report ‘Accountability in Modern Government: What are the

Issues?’ UK April 2018 also highlighted how weak accountability increases the risk of failure of

public services – whether through financial mismanagement, chronic underperformance or the

collapse of services.

The report found patterns of failure repeatedly occurring:

 Ministers and civil servants blaming each other when things went wrong, thereby
limiting the chances of lessons being learned and mistakes being avoided in the future.
This affected flagship projects such as the rollout of Universal Credit and, more
recently, the Windrush immigration cases.
 Ministers not being held to account for decisions even when failures are clearly
attributable to them. Ministers responsible for the Metronet contracts and the
outsourcing of probation services were never called to explain why they opted for risky,
and ultimately wasteful approaches.
 Poor contract management often resulting in wider public services failures, from the
millions of pounds lost in the overbilling for prisoner electronic tagging to the problems

with benefit assessments. The recent collapse of Carillion highlights the importance of
tackling these issues systematically.

The report argued that the UK’s system of accountability was not keeping up with the realities of

modern government, leading to repeated failures, harming the public and undermining trust in


Transparency is closely linked to the issue of accountability. Despite laws about freedom of

information, citizens continue to experience difficulty in accessing information held by the public


Governance Institute recommends that in addition to the matters referred to above the review

panel consider the following issues in its review:

 Government’s role in ensuring that our laws and regulations are treated as important
national infrastructure. As such they require ongoing investment to ensure that they
maintained to a high standard and are ‘fit for purpose’. The public service needs
capable and proactive policy leaders to ensure that legislation and regulation is not a
handbrake on innovation and productivity in the economy. The public service will need
to become more agile in order to respond to rapid and ongoing change.
 The important role which Government plays in ensuring that our laws and regulations
are enforced and that our regulatory agencies are appropriately and equitably
 The importance of taking into account the citizen’s experience of Government services
and undertaking public consultation (the current consultations surrounding the
Modernising Business Registry project undertaken by Treasury are an example of the
importance of engaging stakeholders early in change process).
 Government’s role in structuring itself and sustaining its institutions to tackle complex
multi-sectoral challenges (CAMAC /ACNC are good examples of this).
 Data governance and privacy, particularly in light of the Productivity Commission’s
Inquiry Report, Overview and Recommendations, Data Availability and Use, 31 March
 Meeting demand for more services in an environment of fiscal constraint.
 The importance of social equity and recognising the needs of diversity, both internal
and external, when designing new policies and programs.

We welcome the opportunity to engage further with the review panel and elaborate on any of

these issues.

Yours sincerely

Steven Burrell

Chief Executive

Governance Institute of Australia

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