Civil Service overview (see note ii)

At the Commonwealth level, the Australian Public Service (APS) is a career service and generally staff are recruited on a permanent basis. The APS include those government institutions serving Parliament, Departments, and many agencies, tribunals and commissions.  APS staff are employed under the Australian Public Service Act. Other staff, such as the Australian Federal Police, are employed under other Acts. Immigration and customs services are part of the APS, however other equivalents of the Hong Kong Disciplined Services; the police, fire services and correctional services, are State responsibilities and so fall outside of the APS.  Australia has no equivalent of the Government Flying Service.

·          The public sector in Australia employs some 189,500 staff, of which the APS accounts for 63% (nearly 119,000 staff) 

·          APS forms 1.3% of total employment in Australia

·          The vast majority of APS staff are employed on a full-time basis (91%)

Under the Public Service Act, the Senior Executive Service (SES) is established in order to provide for a group of officers who may undertake higher level policy advice, managerial and professional responsibilities in Departments and may be deployed within and between agencies so as best to promote the efficiency of the Australian Public Service.   There are around 1600 officers in the SES, equal to 1.5% of all employees in the APS.

The APS Act also identifies the Values and Code of Conduct for the APS and sets down the important accountability provisions and the relationship of the public service to Ministers and to Parliament. Generally the Values require that the APS is apolitical in performing its functions, employment decisions are based on merit, there is open accountability, services are delivered fairly and courteously, and there is a focus on leadership, achieving results and managing performance.  The Code of Conduct requires employees to act with honesty and integrity, be diligent, respectful, and maintain confidentiality. 

Public Sector Reform (see note iii)

General public sector reform

Over the last twenty years, Australia has had two radically different phases of public sector reform.  The Hawke Labour Government drove the first phase of Australian public sector reform, from 1983 to 1996 with a well-articulated public service policy, designed to ensure that Ministers were firmly in control of the public policy agenda.  Its reforms were aimed at clearer specification of objectives, devolution of authority and responsibility, and accountability enhanced by evaluation of performance.  Specific actions included corporatisation and privatisation for some government services, improvement of financial management, abandonment of central control over staff numbers (but retaining control over senior executives), and a range of personnel and management reforms, including the introduction of the SES, rationalisation of the classification structures and abandonment of central classification controls.  The overall effect was a shift in focus from inputs to outputs and outcomes, and significant efficiency improvements for those activities previously conducted by Government.  However the broader efficiency of government had not been subject to much scrutiny or evaluation, as most government operations were sheltered from competitive pressure.

The incoming conservative Howard Coalition Government was deeply sceptical about the efficiency of the public service. It believed that the public service had major inflexibilities in its administrative, industrial and financial dealings; high compliance costs associated with rules and regulations; and a bureaucracy that lagged behind other governments and the private sector.  Its response was to cut around 5% from the Commonwealth Budget, and introduce a range of new initiatives:

· Workplace relations changes:  The Government has devolved human resource management responsibility to agency heads and authority to settle their employees’ terms and conditions of employment.  Agencies are free to negotiate within the Government’s policy parameters for agreement making in the APS (see below). This vests in them greater flexibility and authority to manage their own workplaces.

· New financial legislation:  The Audit Act 1901 was replaced with a package of legislation that involves significant devolution of responsibility for financial management to agency heads.  Detailed, complex and intrusive finance regulations were substantially swept aside, and new Chief Executive Instructions allow agency heads to establish a financial framework and processes that meet their agency business needs.  While initially there was minor impact because agencies translated the previous detailed financial instructions into their Chief Executive Instructions, many are now reviewing their instructions to develop more practical and better targeted arrangements.

· Competitive tendering and contracting:  This has become a key component of the Government’s public sector reform.  Market testing of relevant activities and services is mandatory for all agencies.  In response to the Industry Commission’s report on Competitive Tendering and Contracting by Public Sector Agencies, the Government required all departments and agencies to systematically review all their activities to ensure that APS attention is focussed on core Commonwealth business.  Where an activity does not come within Commonwealth responsibility, agencies are required to consider whether the activity should be devolved to a more appropriate level of government, privatised or discontinued.  If remaining within Government, managers must look for ways to improve efficiency and effectiveness using tools such as benchmarking, re-engineering, competitive tendering and contracting to improve efficiency and effectiveness.  A significant area of interest was government IT infrastructure, although experience with outsourcing this area has been mixed.  The implementation has focused so far on corporate services such as human resource management, financial services, records management, facilities and property management.

· Service charters:  All Government Departments and Agencies that deal directly with the public are required to have a customer service charter that sets out: the key standards of service that customers can expect to receive; customers rights and responsibilities; how to complain should services not be met; the response of the Agency if it does not meet its service standards; and how to comment on the service charter.  The principles require departments to monitor performance against the charter standards and to account for operations by publishing information on its compliance.  Virtually all Agencies now have these in place, and a Department of Finance survey in 2001 indicated 80% of Agencies had improved service delivery.

· Government online:  In the Investing for Growth statement, Government committed to putting all appropriate Government services online by 2001.  A major strategic priority was to enhance services to regional Australia.  As part of the strategy, Departments were required to pay all suppliers electronically by the end of 2000, and to deal with all ‘simple procurement’ electronically by the end of 2001. These objectives were achieved. Each Department is now required to publish an Online Action Plan, and report twice yearly to Government on progress in key areas.

· Accrual budget:  Australia has moved to accrual budgeting with the first accrual Budget delivered in May 1999.  The new framework changes both how and what the Commonwealth measures (outputs and outcomes), for budgeting accounting and reporting purposes.  It required that Commonwealth Department and Agency managers acquire a new set of financial management skills.  While this placed a considerable strain on Departments and Agencies, where greater support and guidance was needed to implement the framework, including professionally qualified accounting staff, the second accrual Budget was delivered in May 2000 and went far more smoothly, although the quality of information needs improvement.

The outcome of this later wave of reform is a firm focus on the effectiveness and efficiency of the public service, subjecting the vast bulk of government activity to competitive pressure.  While the reform provides Departments with new flexibility to manage their people, some have been slow to embrace this, and the perceived success of this aspect of the reforms is mixed.

Pay specific reforms

Prior to 1996, Australia had a highly centralised pay system, with most terms and conditions determined by the Australian Industrial Relations Commission (AIRC), with pay increases determined by a typically annual National Wage Case. Within the APS, there were over 100 Awards that determined the terms and conditions of employment.  A common feature was that pay rates were fixed - whilst there were usually pay ranges within a grade, there was typically little flexibility in the pay rate for an individual, and progression through pay points within a grade was virtually automatic. 

The new framework through the Workplace Relations Act 1996 (which applies to employees across the economy in both the public and private sectors) has reshaped the industrial relations system facilitating a more direct relationship between employers and employees. The setting of pay and conditions of employment for the APS was devolved to individual agencies in 1997.  Key features of workplace relations change includes: 

·          Award simplification: This has been a major component of reform. The Department of Employment and Workplace Relations (DEWR) has employer responsibility for awards applying to the Australian Public Service (APS). As part of this responsibility, over 100 APS Awards were rationalised in 1995 to form an integrated set of nine Awards: the APS General Employment Conditions Award 1995, the various classifications awards and the APS Agency Specific Provisions Award 1995. The aim was to simplify terms and conditions so that they focus on minimum standards, rationalisation of the available allowances and leave entitlements, removal of provisions which restrict or hinder productivity and the efficient performance of work, the use of plain English expression of award provisions and removal of obsolete provisions, among other changes.

·          Awards safety net: Historically the APS Award specified the terms and conditions of employment, however following 1996 reform, the employees’ actual conditions are now typically specified in agreements. The role of awards has consequently changed and the simplified range of nine Awards provide a base, or minimum set of terms and conditions from which Departments and Agencies can build to make their annual agreements.  The AIRC’s role is now to enforce the minimum safety net for wages and conditions.

·          Agreement-making choices:  Actual wages and conditions, and working arrangements are generally determined by agreement of employers and employees at the workplace level.  The new act provides for Australian Workplace Agreements (AWA) that focus on individuals (mostly the SES), and Certified Agreements (CA) that are collective and cover the bulk of the APS.

·          Freedom of association:  This change provided employees with the freedom to join or not join a union of their choice (compulsory unionism has been outlawed).

·          Industrial action:  There is limited right to strike during the negotiation of an agreement contingent upon a party’s genuine attempt to reach agreement, but not once it is in operation.  This has reduced the amount of industrial action.

Agencies and Departments have readily embraced the flexibilities entailed in the new Workplace Relations Arrangements. Most agencies have now experienced two rounds of agreement making and are about to embark on the third. Agencies seem to be learning from each successive round of agreement making, and improving processes as a result.  The changes involved a significant focus on improving performance. This allowed for improvements to pay and conditions linked to productivity gains, underpinned by effective performance arrangements to guide salary change.

 

Overview of Current Pay and Administration Arrangements (see note iv)

Australia has applied its current pay and administrative arrangements across the economy, so that they include all Government employees (Federal, State and Local - including disciplined services outside the APS such as the police, fire and correctional services) as well as the private sector.  This summary primarily focuses on the APS as the core ‘Civil Service’.

Pay administration policies and principles

The setting of the pay and conditions of employment for Commonwealth public servants is highly decentralised and was devolved to individual agencies in 1997.  Policy is developed by the Department of Employment and Workplace Relations (DEWR) and is focused to:

·          Foster more direct relations between employers and employees

·          Link pay and conditions to productivity gains

·          Be funded within agency appropriations (there are no other limits to budget except that any changes to pay and other terms and conditions are constrained by the Department’s available budget)

·          Provide access to compulsory redeployment, reduction and retrenchment provided these are not an enhancement of existing redundancy obligations applying to an agency

·          Facilitate mobility and maintain a cohesive APS by maintaining the APS classification or Agency structure (but with ability to broadband it further), use effective performance management arrangements to facilitate salary movement, and retain portability of leave entitlements.

DEWR also provide advice and information on APS remuneration, classification and conditions of employment, but have no centralised control over Agency pay negotiations.

Under the Workplace Relations Act 1996 staff are to be covered by two types of Agreements:

·          Individual Australian Workplace Agreements (AWA’s) currently covers over 5% of APS employees, including 94% of the SES.  While these are individual agreements and must be signed individually, they can be reached collectively.  Employees can appoint a bargaining agent (including a union) to negotiate on their behalf, although this is rarely done.

·          Certified Agreements (CA) (over 94% of APS employees).  These agreements can also be reached directly with employees or with unions, although usually the latter, with union participation mandatory upon the request of an employee.  CA’s must be ratified by the AIRC, who must be satisfied that there is no disadvantage to the employees, and the agreement is thoroughly understood and supported by the majority of employees to whom the agreement applies.

Agencies must obtain Government approval from the Agency Minister (with an assessment against policy objectives provided through DEWR) before seeking to certify agreements.

Pay structure and components

Grading and base pay structures (see note v)

Historically, classification structures were complex and subject to complicated rules. All parties welcomed recent simplification.  There are now 11 groups within the APS based on the standard APS grades (‘grades’ are equivalent to ‘ranks’ in Hong Kong):

·          APS Levels 1-6; covering the bulk of APS employment

·          Executive Levels 1 and 2; covering middle managers

·          Senior Executive Service Levels 1-3; comprises senior executives (SES)

The APS Classification Rules also provide for associated training classifications comprising APS Trainees and Agency Trainees.  For any particular job, the Department or agency must classify it based on the work value requirements of the group of duties.

The pay range assigned to each grade is specified in the Agency Certified Agreement, which usually states a number of fixed pay points within each range. Salary ranges have widened significantly at every APS classification level, usually with a considerable overlap in the salary ranges.  Agencies are free to broadband the APS Classification Structure (i.e. collecting grades within a band through which a person can progress without formal promotion) but they must be mindful of the Public Service Commissioner’s view that to meet the policies of merit and reasonable access, at least two breaks must be incorporated that would require open competitive selection.  Therefore movement between (broad-banded) grades is by competitive selection.

Pay components

The major components of pay are usually base pay, overtime and associated meal allowances, and performance pay (incremental or bonus).  There may also be a number of additional allowances (see below).  Employers and employees generally determine actual wages and conditions by agreement.  For an individual covered by a CA, pay (including entry pay) can be set at any point in the range for that person’s grade, except that it cannot exceed the maximum, nor be lower than the minimum. There are no constraints on the pay of an individual on an AWA.

Many Agencies have a large number of additional allowances, although in most cases these are being rationalised, and in some, eliminated – however allowances have a low potential value, typically no more than 10% of salary. Some of the more radical CA’s have substantially dismantled complex and arcane systems of allowances that had grown up over the decades, with these typically rolled into base pay. The Department of Finance and Administration, for example, has abolished almost all allowances, including overtime – where additional effort is reflected in performance pay or time off in lieu.

There is no widespread system of non-accountable cash allowances (the exception used to be for official travel), as Agencies are moving to a system of credit card or cost-reimbursement to manage expenses.  Typically a housing allowance (or housing) is provided to people working in remote locations such as remote national parks or aboriginal communities, or areas of high living cost such as Sydney, although this would only cover a very small number of people.

Performance pay is still a relatively small proportion of total remuneration, around 5% on average but ranging up to 15% in some agencies, or a fixed amount of between Au$500-2000 - both specified in the agreement.  Performance bonus is far more common for the senior civil service (SES) with at least 80% of eligible SES receiving a bonus payment which ranged up to 32% of base salary and averaged around 5% of their total remuneration package.  Some Departments have sought to recognise and reward team performance often centred on achieving a defined assignment or set of tasks.  For example, the Accrual Budget Group in the Department of Finance and Administration were eligible for a performance bonus equal to three months pay for successful completion of their project by June 30, 2000.

Pay system and administration

Design and management of pay structures, and pay administration is devolved to Departments, and are not centrally regulated.  However in undertaking their responsibilities in each of these areas since 1996, Departments and Agencies have commonly required assistance from outside expertise.  Implementation of pay structures is through the AWAs or CAs, neither of which can be ratified without agreement from relevant staff.  Pay administration is often an area where delivery has been outsourced as part of the competitive tendering and contracting reforms previously described.

Movement within the pay band

Typically, progression within broad-banded grades is dependent on performance, with accelerated progression available for outstanding performance.  The APS performance management framework is not prescriptive and provides agencies with the flexibility to adopt approaches to performance management that are tailored to best serve the diverse needs of the individual Agencies.

Almost all performance remuneration is based on individual performance against an individual performance contract, assessed by the individual’s superior, often using peer review and frequently subject to endorsement/moderation by senior management.  The majority of CAs advance individuals through multiple pay points within the broadband grade, typically one pay point for an effective performance, and two pay points for superior performance (or alternatively, a negotiated percentage change in salary).

System and mechanism for determining pay levels and pay adjustments (see note vi)

Before 1996, a typically annual National Wage Case determined pay increases for the majority of workers.  Major employer bodies and trade unions were the main parties involved in wage negotiations.  A common feature was that pay rates were fixed, and progression through the pay points within a grade was virtually automatic. However this has changed following the Workplace Relations Act 1996, with responsibility delegated to individual Departments and agencies, and subject to negotiations with employees and their representatives.  A 2001 Agency survey by DEWR suggests that there is now a remarkable degree of variation in tailoring pay packages within Agencies to meet their specific business priorities and needs.

The DEWR undertakes and publishes remuneration surveys covering all elements of pay across the public and private sector workforce. Although there is no requirement for Agencies to utilise this material in their pay negotiations, they are operating in a competitive environment to recruit and retain staff, so may wish to consider this market comparison but there is no automatic link. When Departments negotiate their employment agreements, however, they must be consistent with Government’s APS remuneration policy that improvements to pay and conditions be linked to productivity gains and that performance management arrangements guide salary movement so that pay changes are performance based. 

Arrangements for the Disciplined Services (see note vii)

This section illustrates the treatment of the Disciplined Services, using the Australian Federal Police as an example. 

The nearest Commonwealth equivalent to the Hong Kong Police Force is the Australian Federal Police (AFP), which falls outside the APS.  However, the provisions of the Workplace Relations Act 1996 apply equally to the AFP as they do any other employee group across the economy.  This means that that in effect, the arrangements applying to the AFP are effectively identical to those applying to the APS as discussed in this paper. 

The AFP enforces Commonwealth criminal law, and protects Commonwealth and national interests from crime in Australia and overseas. The AFP is Australia's international law enforcement and policing representative, and the chief source of advice to the Australian Government on policing issues (standard Police services are a State responsibility).

The Australian Federal Police has been undergoing continual evolution since its inception in 1979. Throughout this period the AFP has continued to develop a high quality law enforcement capability, and continued to deliver a high quality service to the community and the government. The Federal government has clearly outlined its expectation of the AFP in the latest Ministerial Direction made under sub-section 13(2) of the Australian Federal Police Act. The AFPs reform agenda and the continuing changes to the management structures and resource management practices are integral to the AFPs ability to deliver these required outcomes.

The Australian Federal Police Act 1979 and other Commonwealth employment legislation establishes the employment framework for all AFP employees.  The pay system for support staff is the same as that of police officers.  Conditions of service specific to all AFP employees (apart from Senior Executives) are set out in the AFP Certified Agreement 1999-2002.  The conditions of service for the senior executive are negotiated through individual AWAs. 

The AFP Certified Agreement 1999-2002 has as one of its objectives, continuing the move towards a flexible and professional remuneration and benefits package which recognises the flexible and diverse nature of the AFP's work, remunerates employees accordingly, and is based on mutual trust between the AFP and its workforce.

The Remuneration Strategy of the Agreement includes four elements that collectively determine pay within the AFP. These are:

· An assessment of the work value of roles in the AFP;

· The skills, knowledge and personal attributes the individual brings to the role;

· The outputs agreed in the employee performance plan for that team/individual and their performance record; and

· Where appropriate, the AFPs need to have regard to the external market.

Remuneration and certain entitlements may vary between categories of AFP employment depending on location within Australia or overseas, the type of work undertaken, working patterns and work/life balance. 

Some other elements of the agreement include:

· An across the board salary increase to be delivered over 4 years

· The 22 grade (i.e. rank) salary spine to be reviewed annually against the wage cost index produced by the Department of Finance and Administration

· Advancement between grades to be competitive

· Access to performance bonus subject to assessment against the formal performance management plan (PMP)

· Advancement up the pay spine subject to the PMP and date of last promotion, with accelerated advancement dependent on the PMP and assessment of merit by the Police Commissioner

· A focus on developing flexible workplace arrangements, such as hours of work or leave arrangements.

Additional allowances are paid for example on overseas service, deployment to high cost living areas and as compensation for hours generally worked flexibly in excess of the normal 40 hour working week.  For example:

·          For a full time employee working in an area designated as operations, the allowance is 33% of the employee's annual base salary;

·          For community operations, the allowance is 25% of the employee's annual base salary plus double time overtime for any duty worked after 84 hours in any paid fortnight; and

·          For an employee in an area designated as commercial, the allowance is 3% of the employee's annual base salary.

Being subject to the same overall policies as the APS, the AFP are also working to introduce more flexible workplace arrangements, and placing greater emphasis on performance driven movement through the pay spine.

The Experience of Changing Pay Administration Arrangements

Experience of replacing fixed pay scales with pay ranges

As mentioned previously, this responsibility was delegated to Agencies and Departments. There was little resistance to more flexible pay arrangements.  The AWA or CA became the only way for staff to gain a pay increase, although unions have been concerned that pay differentials have resulted (in practice, the scope for disparities is limited because of the need to fund pay increases within budget allocations, and pay relativities for non-SES staff have not moved far from the former regulated system).  There is however, significant widening and overlapping of salary ranges associated with the grades in the APS as Agencies had the capacity to implement new arrangements in ways that suited their needs.  Use of external resources was often required to support the process.

Experience of introducing performance based rewards (see note viii)

Australia has had a reasonable degree of resistance to performance management.  Performance appraisal and pay arrangements were first introduced to the APS for the SES in 1992, with individual performance assessment, however unions in particular, argued that this would detract from team performance.  Adoption was by vote, and in many cases, senior officers voted the system down, preferring no additional pay or bonus to the proposed performance management system. In 1996, a change of Government led to radical change within the APS, including widespread introduction of performance pay through the Workplace Relations Act 1996.

The Australian Public Service Values explicit in the Act make clear that achieving results and managing performance are central to the work of the APS. Departments were required by Government to design and implement their systems in little over a year, so there was significant reliance on outside expertise to assist with the process and to transfer skills to the public sector. Because performance management systems became an integrated part of the negotiation of employee terms and conditions, there was extensive negotiation with employees and their union representatives, which was critical in gaining sufficient staff support early in the process, however it also created pressure for unions, which made the initial process lengthy, complex and tense.  While unions initially resisted vigorously, there is now general acceptance of the process and it runs far more smoothly as Agencies move to their second and third annual agreements.  Most agencies provided training to their employees as part of the implementation process. 

Implementation of performance management systems has been a dynamic process in Australia with many modifications being made over time with each new negotiation, including to rating scales, remuneration arrangements, links to business planning priorities, and moderation and consultation processes.  In addition, a small number of Departments provide for recognition benefits and rewards that may include Secretary’s or Australia Day awards, and informal rewards such as theatre tickets, development opportunities, written comments of appreciation, home/based work programs and time off in lieu, as well as more explicit performance pay arrangements.  However it is noted that there is potential that these rewards could be counterproductive if seen to be favouring particular groups of people.

Agency respondents to the DEWR survey were asked to state the broad nature of the most important performance enhancing provisions in their agreements. The top five ranked were performance management arrangements (74 per cent), family friendly working arrangements (also 74 per cent), flexible working hours (61 per cent), tailoring conditions to agency business (57 per cent) and simplification of leave entitlements (56 per cent).

Although significant progress has been made, some major challenges remain.  A study by the Management Advisory Committee found the credibility of systems were an issue, particularly where employee perceptions about fairness and consistency in application were negative and moderation ineffective.  Most important were the quality and meaningfulness of performance measures and how they are seen to link with agency priorities.  There were further concerns raised that little is done to manage under-performance. However agency frameworks do attempt to address these issues, for example, Treasury provides for processes to ensure consistency, two way feedback, the basis for skills development, system controls to facilitate transparency and fairness, and provisions for addressing under-performance.

Experience of simplification and decentralisation of pay administration

Please refer to the earlier section on “Pay system and administration”.

When the Howard Government came to power in 1996 it was confronted by major legislative and administrative inflexibilities.  The costs to government were high because of a culture of compliance with rules and regulation that were outdated and overly prescriptive. There was also the major cost of making the central pay system year 2000 compliant, and a decision was taken that it should be abandoned.  The simplification of classification structures and devolution of responsibilities to agencies was welcomed by the APS.  While unions and many staff were reluctant to accept rationalisation of allowances, they ultimately agreed to it as part of CA packages that included other benefits.

The decentralisation of pay administration and devolution of responsibility left agencies with a range of new responsibilities. The general approach was to obtain significant external support to manage the transition.  Agencies also tended to replicate the abandoned central controls as a first step, then to amend these subsequently.  The reduced costs achieved were shared with staff through pay increases, and current arrangements are now generally simpler, and easier to understand and administer.  Some administrative functions, such as payroll, are now outsourced.

Points of Interest

The current arrangements have enabled the rationalisation of allowances, have reduced administrative costs and simplified remuneration arrangements, and according to the 2001 DEWR survey, these costs savings are shared with all staff through pay increases.

Flexibility has enabled Agency pay arrangements to be better tailored to suit Agency and employee needs, simpler and easier to understand and administer (often through outsourcing), and provide the scope to compete for staff whose skills are in high demand (e.g. IT).  Common features include a stronger link with performance appraisal and performance more generally, with flexible use of classification structures, flexible working hours and arrangements, and simplification of leave, allowances and penalty provisions.  Measures to enable people to balance their work and family responsibilities are also prevalent. The new Agreements have also been used to secure commitment to organisational change.  It is likely that these outcomes will strengthen in future.

There remain, however, some Agencies that have not strayed too far from the old Award arrangements and have done little to take advantage of the flexibilities.  This mismatch between Agencies has meant there is some inhibition of lateral movement of functions or people between agencies as a result of the need to deal with the different terms and conditions. In addition, there are some who argue that the new arrangements adversely impact the concept of a single Civil Service.

Undoubtedly the key to successful change in the APS has been the more general changes in workplace arrangements, where the Workplace Relations Act deregulated pay and conditions throughout the Australian economy – and therefore APS and disciplined services pay deregulation were simply a part of this wider agenda.  Unions resisted the changes fiercely, but have come to accept the new arrangements.  Their particular issues are the scope for senior management to give themselves substantial pay increases while opposing those for the rank and file (exacerbated because AWA contracts are individual and confidential), and they have concerns about the capacity of individuals to effectively negotiate (although individuals have a legal right to representation).  Unions also argue for team-based performance pay in many cases (but it should be noted that nothing in the current arrangements precludes this). Such considerable change and the skills needed for delegated negotiation would require a significant commitment of resources, and this can be difficult for smaller agencies.  It would be important to facilitate the availability of strategic HR advice and training, either internally or from the private sector, and a binding budget that will ensure that flexibility is not abused.  Top-down commitment is essential as is building credibility. 

Key trends

The policies of the Government with respect to workplace relations, and the DEWR survey of Agreement Making have provided indicators of the changes and trends as departments and agencies are responding to their devolved responsibilities for employment matters after 2 rounds of workplace agreements, and now entering their third round of negotiations.  These include:

　

· Continued emphasis on performance management systems

· Stronger link with performance appraisal and performance pay

· More flexible use of classification structures, including through extended use of broad banding

· More use of flexible working hours and arrangements, simplification of leave, allowances and penalties, and measures to enable people to balance their work and family responsibilities

· More consideration of team based reward where some departments are experimenting with bonus for project completion

· Greater use of negotiated agreements to secure commitment to organisational goals and cultural change, with elements of pay dependent on achievement of organisational goals as directed by Government policy.

Although there are wide ranging views, overall the current arrangements are thought to have been successful in changing the culture of pay negotiations within the APS, and outcomes are undoubtedly improving with each new round of negotiation.  Performance management systems are seen to have forced dialogue between managers and their staff, so that issues are dealt with rather than swept under the carpet.

End Note:

 Background Reference Sources

i.             “The Parliament:  An overview” www.aph.gov.au; “Australia in focus” www.pmc.gov.au.

ii.           Budget Paper No 1 2001-01, p4.8; Public Service and Merit Protection Commission “Australian Public Service Statistical Bulletin 2000-01

iii.          “Reforming the Australian Public Service, A statement of the Government’s intentions, Australian Government Publishing Service, Canberra 1983;

iii.         The Hon David Kemp, Minister Assisting the Prime Minister for the Public Service, “Reforming the public service to meet the global challenge”, Feb 1998

iv.          Department of Employment, Workplace Relations and Small Business, “2001 Survey of Agreement Making in the APS” Canberra 2001; Department of Employment, Workplace Relations and Small Business, Supporting Guidance for the Policy Parameters for Agreement Making in the APS, Canberra, 2000.

v.         Department of Employment, Workplace Relations and Small Business, Public Service Classification Rules 2000, Canberra 2000.

vi.         2000 Senior Executive Service Remuneration Survey; 2001 Non-SES Remuneration Survey; all available on the website www.dewrsb.gov.au, also Department of Employment, Workplace Relations and Small Business, 2000 Senior Executive Service Broader Market Comparison, Canberra 2000, p5.

vii.       Australian Federal Police, Conditions of Service, www.afp.gov.au, Australian Federal Police, AFP Certified Agreement 1999-2002, www.afp.gov.au.

viii.      Management Advisory Committee, Performance Management in the Australian Public Service, Canberra, 2001; Public Service and Merit Protection Commission, 1999, State of the Service Report 1998-99.