The illusion of efficiency: Why downsizing the public service won’t fix bureaucracy
Government decisions dictate changes in scale and priorities. The ideal size of the APS should be based on the nature and extent of the Australian Government’s activities and its preferred delivery model for executing them.
First published in the Mandarin.
A curtain of pessimistic fatalism descends on the Australian public as it enters the febrile atmosphere of a federal election. The community braces itself for five weeks of performative politics, perfectly summed up by The Shovel: I’m not sure I’ve got it in me to give a shit. Just fast forward to the bit where I can get a sausage in bread.
The public service was once again central to the guerrilla encounters between politicians leading up to the election announcement. Predictably, underscoring the shallowness of both parties, these skirmishes have concentrated on the size of the public service.
Opposition public service spokeswoman Senator Jane Hume outlined that the Coalition would reduce the total public service workforce to 2022 levels: ‘We think that the 36,000 public servants that have been brought on haven’t demonstrated that the improvements to the public have been corresponding.’
A better question might be: Does the leadership and management climate of the Australian Public Service allow it to achieve its objectives efficiently, effectively, and sustainably?
It’s not a question that suits the short-termism that dominates election politics because the answer is not as simple as ‘make it smaller’.
Stop the bloat
The recently released Menzies Institute report, with the attention-grabbing title, ‘Stop the Bloat’, reinforces ‘the make the public service smaller’ argument. However, the opening paragraph of the executive summary neatly lays out the report’s position:
‘Inefficiency and waste in the Commonwealth Government imposes significant costs on all Australians. Excessive red and green tape is driving up costs for businesses, holding back economic growth and productivity. The effectiveness of government services is being reduced by a bloated, Canberra-centric public service and waste across grant programs, leading to higher deficits that put upwards pressure on inflation.’
The government has often emphasised that most Australian Public Service functions outside Canberra. Nevertheless, the report primarily suggests solutions addressing government inefficiency and bureaucracy.
In summary, the report supports a centrally controlled bureaucracy featuring a technologically advanced and streamlined public service, where decisions to deviate from the established path are made at the highest levels. Downsizing the public service is the best way to stop the bloat.
However, is it realistic or achievable?
The trouble with bureaucracy
The bureaucracies of democratic nations are rightly under constant scrutiny, but not because they are large or small. They are under scrutiny because of a functional, professional bureaucracy and public service that efficiently serves the needs of the government on behalf of the population and is central to trust in government.
Robodebt debt is an example of lost public trust through poor policy and government administration.
The public service is responsible for consistently and transparently providing essential services in ways that foster ordinary people’s trust in the government.
As Glyn Davis, the Secretary of Prime Minister and Cabinet stated in his 2022 annual address: ‘Neither politics nor public service is sufficient on its own. Politics without action is mere performance, while public service lacking purpose is simply bureaucracy.’
The public gets a lot of performance during an election.
In 2024, Professor Davis drew attention to the way elections surface three familiar assertions about government services:
1. Government programs slow down the economy.
2. Public service is, by nature, inefficient.
3. Public servants operate in their own interest, not that of their nation.
Once more, these familiar themes dominate the current election campaigns.
On Professor Davis’ third point, public servants are portrayed either as cunning, self-interested manipulators of bureaucratic power or as sluggish and uninspired individuals who obstruct the honest and hardworking leaders of Australian industry. There never seems to be an in-between state or a third option.
Public servants are typically committed, well-meaning, industrious, and caring individuals. What is often overlooked is that they are also ensnared by red tape.
Government inefficiency and bureaucracy arise not from the number of public servants but from the decisions made by governments and the costs the community accepts for consistency and fairness in administration.
Things that make you go hmmmm….
Public administration and the accompanying bureaucracy are a function of history and the prevailing governing philosophy.
Government decisions dictate changes in scale and priorities, determining which activities should be reduced or eliminated entirely. Unlike the ongoing election discussions, establishing the ideal size of the APS isn’t straightforward and cannot be predetermined. Instead, it should be based on the nature and extent of the Australian Government’s activities and its preferred delivery model for executing them.
Again, contrary to prevailing commentary, the public service environment is never static. Government policy is responding to evolving community needs and expectations, which are constantly rising.
The APS routinely advises on reprioritising current activities to accommodate emerging or higher government priorities.
Departments and agencies also regularly respond to crises, such as the pandemic and natural disasters, which require rapid reprioritisation and workforce allocation. The APS cannot opt out of these responsibilities due to a lack of personnel or resources.
Governments can reduce the size of the public service, but it comes at a cost in capacity, capability, and organisational adaptability.
Governments can also devolve accountability to other levels of government, as seen in the United States. However, that shifts the costs and increases the number of bureaucratic coordination points; it does not make the government smaller.
Governments can use incentives and persuasion to promote efficiency and accountability. One approach is efficiency dividends, which have been used over the years. However, the unintended consequences are hard to predict or control. Efficiency dividends are like using a meat cleaver to perform surgery.
Lighter-than-air decision-making
In the late 1960s, management guru Peter Drucker cautioned that government was turning ‘ungovernable’ and emphasised that effective systems must allow ‘full scope to individual strength and responsibility. ‘
Significant evidence gathered over many years indicates that removing human accountability in decision-making leads to more cumbersome and static bureaucratic systems, an increase in legal decisions influencing public administration, and procurement-related delays that continually raise service costs—all arising from the unintended consequences of rule-based systems.
Certain government activities, such as payments and taxes, require prescriptive rules. However, human judgment is essential in all government functions, including rule-based ones.
The administrative system does not require trust in any specific official; it requires trust in an open and legal framework where responsible individuals, the government, and the public can ensure the merits of administrative decision-making.
Arguments for arbitrarily reducing the size of the public service often centre on centralising administrative decision-making. The goal is to minimise human fallibility, abuse, and costs while consolidating decision-making responsibility in the hands of increasingly senior individuals.
Anecdotally, there has been concern that decision-making in the public service has incrementally moved higher in departments and agencies. The result is a persistent undermining of the middle manager’s decision-making capability and experience.
By doing this, mid-level public service leaders and managers discover they lack adequate space to exercise judgment or adjust priorities in response to new demands. Consequently, the system gradually slows down to align with the cognitive pace of a senior executive overwhelmed by decisions.
A radical thought
A radical approach to enhancing public service efficiency could be incorporating human responsibility into decision-making.
Instead of being evaluated solely on compliance with processes or held accountable for performance metrics beyond their control, individuals might be assessed based on a more comprehensive perspective of their effectiveness.
A leadership climate characterised by mutual trust, understanding, and acceptance of responsibility and risk within the public service would significantly enhance efficiency.
No matter the political stance, governments seek innovative and efficient public services.
These results frequently arise in leadership environments where decision-making is decentralised, allowing mid-level leaders and managers some flexibility in executing their tasks.
Teams operate within a flat structure with well-defined responsibilities. Authority and power shift based on varying situations and individual competencies, while job roles tend to be adaptable, often shaped through collaboration with colleagues.
The answer to a more efficient public service is unlikely to be ‘make it smaller’.
