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Independent review of the APS

Department of the Prime Minister and Cabinet

PO Box 6500

Canberra ACT 2600

Submission to review of Australian Public Service – Part 2

Dear reviewers:

This is the second part of a submission to your review of the Australian Public Service.

The first part of the submission demonstrated a gap between the Australian Public Service and Australia’s democratic foundations at least where it undertakes tasks beyond Commonwealth direct powers. It also demonstrated misunderstandings of governance. As these issues have grown, engagement with the community has reduced and pride in work has diminished. I believe these matters are associated. Four illustrative case studies are appended.

Origins can be traced to changes in the stance of the Commonwealth during the 1970s and 1980s. At that time there was a clear national ‘narrative’ around modernisation of Australia and improvement of national economic performance by expanding the influence of the Commonwealth Executive. The national highway program and heavy vehicle charges were examples of progress arising from these aims. Their reduction of artificial barriers preventing emergence of national markets was consistent with Federal themes. They were a useful expansion of Commonwealth interests.

By the mid-1990s the national transport narrative was lost. Yet expansion and centralisation of Commonwealth bureaucratic tasks continued. State activities were replicated by line Departments and line Department activities by central Departments. There was no thematic link with Constitutional themes. Often Commonwealth officials sought ‘reforms’ for their own sake aiming at insignificant matters or irresolvable problems. Attempts by other parties to initiate reform processes were stymied.

Amid the confusion, differences between Departmental statements and intentions began to emerge. The variety of funding programs outside the national highway scheme is an example. ‘Popularity’ of road funding led to a spread of programs without Commonwealth, national or perhaps any real purpose. ‘Justifications’, while necessarily creative were tenuous at best.

Outside the Commonwealth this lack purpose was seen as a major problem not least because of a road funding bias. Commonwealth meddling on other matters continued under ever more inventive reasons. By the early 2000s creativity had become misleading. An example is the Auslink national network, purportedly designed to join nationally significant places but whose roads bypassed Sydney’s main rail terminals, Wollongong and Newcastle. As does the national network today.

The Australian Public Service view seemed to be the Commonwealth’s role was to bully States yet avoid accountability for real issues; a stance consistent with limiting its ‘responsibility’ to indeterminate funding. This is likely reason for calls for non-Departmental organisations to advise on national transport matters.

By the early-2000s this view had turned into ‘Commonwealth knows best’ attitudes. Incoming Governments were seen as opportunity to fund new things, say infrastructure in cities, rather than to take on responsibilities for what politicians had promised or to develop a stable Commonwealth role. Resistance to ideas from other parties increased. ‘Road reform’, comprising proposals to change to truck road charges and access is an example of cynicism where options were limited to those with little chance of being adopted.

Policy advice requested by (Prime) Ministers from the National Transport Commission and Infrastructure Australia between 2007-11 implied chronic deficiencies in offerings from the Australian Public Service.

One example is the stark failure of the Commonwealth to take the same planning interest in sea ports as in airports. During the many years and meetings of the national transport Ministerial forum, sea ports had escaped mention.

Advice from the Commission and Infrastructure Australia was followed by a bureaucratic backlash, including from central Departments. Both organisations were subsequently re-created in inappropriate forms reflecting dubious advice from Departments.

The keenness of the Australian Public Service to ‘see-off’ what it saw as competition, coupled with a desire to protect a ‘funding role’, inevitably led to poor practices appearing in public.

The Commonwealth and its Public Service now seems to operate without a compass in transport and infrastructure. The aims of the 1980s and early 1990s have been forgotten. The directions suggested from outside of Departments including by the Commission and Infrastructure Australia have been rejected, indeed there have been attempts to remove them from the record. Yet nothing fills the void.

The problem arising from absence of direction is not that nothing will happen, rather it is anything can happen. Trust cannot exist in such an environment.

Reflecting this absence of direction is an increasingly slipshod approach. Recently the public has seen displays of increasingly bad research, kindergarten errors, faux consultation and what appear to be ‘stitch-ups’. At least two cases of this have had political ramifications. It appears what had once been considered intolerable is becoming normalised in the Australian Public Service. It speaks of loss of pride in work and of arrogance.

That this developed notwithstanding many changes in leadership and staff and ongoing refinement and promulgation of ‘public service principles’ by central Departments suggests deeper failures.

The review is interested in ensuring the Australian Public Service is trusted. In the first part of this submission, I argued honesty and respect are essential for trust. In my opinion the review has not identified two inter-related problems undermining trust in the Australian Public Service:

a substantial part of Australian Public Service activity lacks proper democratic foundation;

while initially well intentioned, later ‘justifications’ of activities led to loss of direction.

The root cause is not lack of day to day ‘control’. Rather it is a spiral of increasingly unclear roles of the Commonwealth Government which the Australian Public Service seems to do nothing to address.

An effective Australian Public Service depends on Commonwealth Government roles being lawful and explicitly accepted by the community, the States, and the Parliament. However, announced intentions of political candidates tend towards the other direction.

The mechanisms in Australia’s democracy to correct this problem are referral of powers from the States or referendums. Those who confidently want Commonwealth Government roles to meet their wishes no doubt would be confident in the prospects of such referendums.

In the absence of such corrections, the principled approach is for Commonwealth infrastructure policies reliant on conditional State grants (under Constitution s.96) to be informed by Statutory Authorities rather than Departments and set by the Parliament and not just the Government.

And as noted earlier, I would be pleased to provide further information and answer questions.

Yours sincerely

J Austen

Monday, 29 April 2019


  1. Advice on national transport policy 1990-20174


1.2The national land transport problem4

1.3Responses to the national problem4

1.4Auslink etc.5

1.5Proposals for national policy6

1.6Beyond 20136


2.Road reform8



3.High speed rail9



4.Western Sydney rail study10



  1. Advice on national transport policy 1990-2017


The Australian Public Service Review commissioned a paper on working with jurisdictions. The paper highlighted difficulties Commonwealth practices cause other Governments. It recommended a non-Departmental secretariat for the Council of Australian Governments.

Since the early 1990s a Council comprising Commonwealth and State Ministers sought to develop national transport policy. The Commonwealth chairs the Council. Its Department of Transport (later Infrastructure etc.) provides Secretariat support and largely determines the agenda.

The Council has failed in these attempts. This is due to issues similar to those identified in the working with jurisdictions paper. This case study tracks my perception of these since the 1990s. A more detailed exposition will be available later this year at the jadebeagle.com.

1.2The national land transport problem

Origin – the road problem

In the early 1990s a national issue arose out of trucking industry concern about different regulations, including charging regulations, in different States.

A National Road Transport Commission was established pursuant to a Special Premiers Conferences and a report by the Interstate Commission. The Commission would develop national heavy vehicle – truck - policy and recommend charges to a determining transport Ministerial Council. The charges were to be uniform across the States.

Origin - the cross-modal and rail problem

One reason for determination of truck regulation by the Ministerial Council is the Constitution does not give the Commonwealth power over roads, except incidentally e.g. re interstate trade and commerce.

However, the Constitution does provide the Commonwealth with powers for rail. The origins are the notorious ‘break of gauge’. The Constitutional theme is the Commonwealth’s primary land transport interest should be to reduce impediments to interstate and international trade and commerce the most prominent of which was different rail gauges in States. This is the interoperability agenda.

Road and rail compete for freight on a few long routes. On those few routes, highway building and truck charges impact rail. Conversely use of rail reduces calls on public funding for highways.

In the lead up to the Commission, rail had been losing freight to trucking on the ‘north-south corridor’ Melbourne-Sydney-Brisbane. Commonwealth land transport spending was almost entirely on roads. Notable projects included improvement of highways, like the Hume, which compete with rail. Yet views were put that misfortunes of rail were due to other causes: first State ownership and industrial relations; then lack of competition, government ownership; later, regulation.

Broadly concurrent with the Road Commission, a national rail freight initiative commenced. It involved a corporation owned by governments taking over interstate freight from the various rail systems. This would deal with supposed impediments of State ownership and industrial relations.

1.3Responses to the national problem


The decline continued with the new rail corporation, demonstrating problems were not merely State ownership nor industrial relations.

That the Commonwealth refused to transfer track assets to the corporation is consistent with officials understanding this. Rather, on threat of transfer, the Commonwealth established a new corporation to take control of relevant track; now the Australian Rail Track Corporation. A claimed purpose was to promote competition in line haul rail freight. Another was to privatise the rail corporation. This would deal with two further supposed causes of rail’s loss of competitiveness.

The idea of promoting competition was misconceived. Competition only occurs for profits but profits for rail were minimal at best due to fierce competition – from trucking. The joint government corporation was privatised in the early 2000s. The effect on rail competitiveness was minimal.

Commonwealth Departments’ focus then shifted to rail ‘regulatory reform’.

‘Regulatory reform’ sounds important as in many areas it involves changes to costs or prices or increases competition; for example, in roads it affects vehicle charges or use. However, as observers pointed out at the time, it could do no such things in rail. The only specific rail regulation refers to safety and is a permissioning system. It has trivial costs, is irrelevant to investment, doesn’t affect competition and, most importantly, is unable to advance the Constitutional theme of interoperability. The concept of ‘rail regulatory reform’ was a product of former Prime Minister Keating’s pet shop galah.

Land transport commission?

A series of inquiries into rail freight were undertaken in the later 1990s. Some recognised underlying problems caused by Commonwealth subsidisation of highways. At least one suggested a Land Transport Commission to advise Governments on relevant issues. This echoed calls from several State Governments who took the view Commonwealth officials, in their duty to represent their Government, could not take the national perspective needed by the Ministerial Council.

One Ministerial Council meeting agreed to establish such a Commission. However, after urgings from the Commonwealth Department, this was ‘unagreed’. Instead there was a National Transport Secretariat, tasked by officials with abstract inquiries. It lasted for 3 years between 2000 and 2003.

The Department’s objection to a Commission was it might offer thoughts on road ‘investments’, particularly on gifts to line haul truckers like the Hume and Pacific Highway duplications.

An independent review of the National Road Transport Commission in 2002 recommended it be replaced by: a national transport commission to advise on road and rail regulation; a national transport advisory council to advise the Ministerial Council on financial impacts of regulatory proposals and other aspects of national policy. The latter was another call for a land transport commission.

1.4Auslink etc.


The Ministerial Council agreed to the proposed regulatory commission but not to the advisory council. The Commonwealth argued it would deal with that by a national policy, Auslink. This was intended to focus Commonwealth funding on a defined national network which would include rail tracks.

Auslink was established in 2004. However, it was not a policy but merely a funding program.

The national network defined by Auslink was and remains a misnomer. For example, it does not extend to Newcastle or Wollongong. It does not include interoperability criteria, it comprises different track gauges, and there has been no attempt to pursue Constitutional themes. In any event, Commonwealth interest is no-longer focused on the network, as its funding is no longer so focused.

Re run of rail regulatory reform and infrastructure pricing

The new National Transport Commission sought opportunities for rail regulatory reform but was unable to identify any. Regulatory reform in rail is now a several-decade long debate about arcane details of rail safety regulation, the conjectured effects of which are thought to be at most millions of dollars compared with the multiple billions were ‘road reform’ to be properly pursued.

In 2006-07 the Productivity Commission inquired into ‘road and rail freight infrastructure pricing’. The inquiry was due to concerns over the possibility of road subsidisation damaging rail, a matter not addressed by the Ministerial Council. The Commission claimed there were no such concerns. It used averages – all roads – to support the argument. It was wrong; the issue is not road network wide, but only for roads parallel to rail lines i.e. major highways such as the Hume.

1.5Proposals for national policy

National Transport Commission

In 2007 a new Labor Government commenced a ‘Nation Building’ program. For transport this essentially was Auslink rebadged to include some projects in urban areas. The Government also requested the National Transport Commission to advise on a national transport policy. In 2008 the Commission produced a framework which was then agreed by the Ministerial Council.

The first review of the Commission, a year later, was led by a long serving head of the Queensland transport department. It recommended the Commission focus on regulation but lamented the absence of a national transport plan.

The review comments suggested there was a bureaucratic turf war involving agencies it interviewed; Commonwealth agencies not accepting external ideas.

Infrastructure Australia

The Government had also established Infrastructure Australia to advise the Council of Australian Governments on national infrastructure priorities. Infrastructure Australia proposed seven themes for its work. Two were national transport matters: a national rail network; international gateways. These were themes of a land transport commission.

On request by the Council of Australian Governments, Infrastructure Australia and the Commission developed a national ports strategy document in 2008-2010. It was endorsed in 2011. There is evidence of bureaucratic machinations to delay and abnegate this policy.

Infrastructure Australia then produced a land freight discussion paper, covering issues of a national freight network. States suggested it should refer to the Council’s policy framework. The draft presented to the Council in 2012 did so and called for a properly defined future national freight network – including roads, rail lines, terminals and ports – whose calls on Government funding should be minimal, a ‘place for freight’ with a user pays-user says principle.

Departmental response

However, Commonwealth officials drafted another version, omitting essential elements and not mentioning the policy framework. It was curiously agreed by the Council. Subsequently the Council’s communiques have not referred to its own policy framework; despite being unanimously endorsed the policy disappeared without trace.

Around this time a second review of the Commission was undertaken by officials, with advice from three ‘government transport practitioners’. Among the background matters was a view that as ‘regulatory reform’ was purportedly complete there was uncertainty about the Commission’s role and duplication of functions. In fact, as noted in the following case study, regulatory reform for roads had not – and still has not - substantively commenced.

More significantly, the Ministerial Council’s tasks had been greatly expanded. Infrastructure Australia submitted the Council would profit from advice independent of Departments and from that advice being open to public scrutiny.

The officials’ review ignored this and recommended the Commission concentrate on ‘regulatory reform’. Further, despite recognising conflicts with existing Government guidelines, it recommended officials be appointed to the Commission’s board.

1.6Beyond 2013

Coalition in office

A Federal Coalition Government was elected in September 2013. It rebadged the Nation Building program. In December the Council of Australian Governments sought ‘urgent’ advice on heavy vehicle charging. It also referred to the desire of interconnectivity in transport. These are the two missing matters in rail policy, neither relate to rail regulatory reform.

In 2014 the High Court undercut many of the perceptions of the Commonwealth Government’s ‘role’. This is discussed in the first part of this submission.

National policy déjà vu

Another review of the National Transport Commission was conducted in 2015 by a former head of the Tasmanian Infrastructure Department and a former head of the Council of Australian Governments reform council secretariat. It doubted the merit of rail ‘regulatory reform’ and called for a wider policy agenda, including consideration of pricing and investment for roads.

The response drafted by officials, as the ‘work program’ for the Ministerial Council, again emphasised rail regulatory reform.

In 2015-16 the ‘reformed’ Infrastructure Australia produced another ‘national infrastructure plan’. This recommended consideration of road pricing and freight.

One response was to ‘accelerate’ consideration of heavy vehicle charging changes by the Ministerial Council. This might be compared with the absence of progress by Council in the preceding twenty years five and the comments in the road reform case study in this note.

Another response was for the Commonwealth to establish a review into freight. The review was to be assisted by experts. However, several of these were active participants in the industry, and one was directly interested in a contentious policy matter. The review was misguided and failed to deal with the essential issues.


National transport policy since the mid-1990s is a case of persistent denial and attempts to distract from the cross-modal problem and the Constitutional theme of interoperability.

Officials have distracted the Ministerial Council to trivial issues and have consistently sought to minimise and ignore external or independent advice and minimise public scrutiny of their advice.

2.Road reform


The length of ‘road reform’ is attributable to attempts at universal road charging. Yet the fact it is not necessary, or even desirable, to introduce pricing or charging to every road (let alone every road user) is widely known including by officials.

A similar issue arises with respect to truck access to roads and was the reason for delay and dissatisfaction with the national heavy vehicle regulator.

Contrary to some suggestions, truck access restrictions can be due to amenity rather than just financial matters. Amenity is a matter for the political system. States would never cede power of determining access to every road. The obvious answer, not publicly progressed, was for independent access determinations for only some roads nominated by the States. This was not considered. The result is the heavy vehicle regulator cannot regulate access to any road.

The certainty of failure of the ‘all roads or nothing’ approach to heavy vehicle charging and access appears to have been a key motivation for Infrastructure Australia recommending a national freight network in 2011, a recommendation not adopted in practice.

Given this, persistence of Commonwealth officials led proposals for all-roads, all-road-user charging is perplexing at the very least. It prevents substantive ‘road reform’ by distracting from feasible options and avoiding the road charging and access trials recommended by Infrastructure Australia.

The effect of making unacceptable road reform proposals is reinforced by failure to consider impacts on rail if trucks were charged on the few roads that compete with railways. The pivotal nature of this question was identified in the early 1990s, yet there is no evidence of attempts to address it. Indeed, the available evidence is consistent with attempts to ignore or deny the importance of the question. For example, the Productivity Commission claimed ‘on average’ road transport subsidies do not impact rail freight. It was a fatuous claim because averages are irrelevant, the Commission ignored capital costs, treated expenditures as costs and fell for the falsehood of a ‘lack of expenditure and traffic flow data’ – which there certainly is not for major highways.

The Commission was later misled into further major mistakes. It claimed ‘arguably’ road revenues cover spending (despite official data showing the contrary). On advice from the Department of Infrastructure it claimed the national access regime does not apply to roads despite both Department and Commission previously being advised this is contradicted by the relevant Act.

More ‘all roads, all road users’ mistakes arose in the Council of Australian Governments road reform plan etc. These included proposals that costs not include ‘sunk’ capital and that road locations should in fact be road classes. These ideas had been specifically rejected by Australia’s economic regulators, for other industries including for railways.

The latter, the use of the word ‘location’ to denote road classes, was misleading. A later episode of a proposal for a pricing regulator, which would not regulate pricing or charges, was also misleading.

The failure of the Commonwealth led national rail policy to propose a test of investment assessment ‘as if there was road charging’, despite this being identified as important by Infrastructure Australia, completes the picture.


Officials have stubbornly pursued ‘road reform’ options known to be infeasible. They have dismissed outside suggestions without explanation and issued misleading statements.

This behaviour is consistent with an intention of ensuring their continuing control over funding for road projects and preventing ‘road reform’ which would enable a regulated industry to determine some road investment.

3.High speed rail


In 2013 the Department produced a report on high-speed rail. The report appeared to go out of its way to produce a proposal that would be unacceptable, not only for its extraordinarily high cost but also because of its outlandish propositions.

One such proposition was the claim of more Sydney bound passengers from Mittagong than from Newcastle or the Central Coast. Another was the proposed location of a station for Newcastle, many kilometres from the city and the population.

Nonetheless, the report was effectively endorsed by an independent expert panel and by the Minister, the Hon. Anthony Albanese MP. Both interpreted the report as indicating high-speed rail is a real possibility in Australia. It could be surmised that instead of reading the report, both relied on briefings from the Australian Public Service.

Since 2016 problems with the report, including the Mittagong proposition, have been highlighted in several posts on websites (reputedly) widely read by public servants.

A range of much more likely options for higher speed rail were similarly highlighted. The Prime Minister subsequently initiated a process in which parties outside the Australian Public Service could submit proposals for studies into such options. At least proposal accepted by the Department appeared contrary to the spirit of the Prime Minister’s initiative, and was likely regarded as a joke by the proponent who later decided to ‘go it alone’.

The high-speed rail story is completed by the current Prime Minister announcing even more studies into options not raised in the initial Departmental study and committing $2billion in funding to an entirely different proposal.

There has been no acknowledgement let alone attempt to address the problems with the original study. Nor, if recent comments from Mr Albanese are any guide, has there been any attempt to correct the impression he formed when Minister.


The high-speed rail study raises suspicions about a hidden bureaucratic agenda to delay or prevent progress. The failure to correct mistakes in the study has created conflicts in the political arena, and put Government and Opposition Parliamentarians in awkward positions.

It points to an ongoing lack of care about transport infrastructure advice given to Parliamentarians and the public. It also demonstrates the Australian Public Service is not always held in high regard by at least one State.

4.Western Sydney rail study


Starting in 2015, Commonwealth and NSW transport Departments jointly undertook a ‘study’ for Western Sydney rail, including to the under-construction Badgerys Creek airport.

A discussion paper in late 2016 sought submissions in a short time frame and indicated an intention to finalise matters in mid-2017. In the event the report was more than a year late and was released in March 2018 at the same time as the ‘city deal’.

The recommendations of the report are nonsensical. They turn on two propositions laid out in the document: seating does not matter for rail passengers; single deck trains are unable to run on the Sydney trains network. The latter was repeated by the Minister in correspondence presumably drafted by the Department.

There are very substantial consequences. The shape of Sydney and the ability of Western Sydney residents to access opportunity is at stake. A $20bn program and the success of the new airport and associated precinct is directly affected.

There also is a major political consequence. The report hid enormous problems caused by contentious NSW Government policies. Other, more feasible, rail options would have pointed to those problems and may have had significant bearing on the outcome of the 2019 State election.

The Badgerys Creek Environmental Impact Statement appears to have been co-opted at a very late stage to support these results. There has been no attempt to hide this.


Irrespective of views about the best approach to western Sydney rail, the above propositions and other elements of the report contain statements no reasonable person could believe.

At the least, this demonstrates a lack of concern on the part of NSW and Australian public services about telling lies to the Commonwealth Government and the public.