Machinery of Government changes: could there be a better way?

Structural changes to government have become a common occurrence in Australia. But, in what circumstances are these so-called 'Machinery of Government' changes worth their while? Dr Gemma Carey reports on a comparison between Canadian and Australian contexts. 

Structural changes to government have become a common occurrence in Australia. They are triggered for a range of reasons: political (the will of particular Prime Minister), symbolic (to signal intend about action in a particular area), logistical (to create a more integrated response) or in response to changes to the portfolios of Ministers just to name just a few. In our research on these so-called ‘Machinery of Government’ (MOG) changes, where structural changes are made to the bureaucracy by merging departments or moving units, we have found that Australia engages an alarming amount of structural change to the public sector.  

What is often overlooked when enacting MOG changes is that they tend to be a source of stress. This was shown this week in a story run by the Canberra times on the first MOG under the current government that was said to leave public servants in a state of ‘panic’. Our research into recent changes to Prime Minister and Cabinet support this claim. We found that cultural clashes and low moral can be produced by MOG changes.

While MOG changes occur for a wide range of reasons, it is often argued by government their particular MOGs will create new efficiencies in the public sector.

However, these potential gains can be lost in what one of our research participants called ‘frictional costs’. By this they meant costs associated with moving people and groups around, including cultural costs, IT costs and industrial relation costs.

The UK Government has begun costing MOGs in an effort to reduce their occurrence by showing their high administrative costs. In the UK, some MOGs have been costed as high as £15-30m in extra staffing and building expenditures alone. This does not account for productivity losses or pay increases that often occur due to changes to enterprise bargaining agreements. In 2010, the London School of Economics put the price of creating the Department for Work and Pensions (DWP) at close to £175m.

At present, even governments with an emphasis on ‘cutting red tape’ have undertaken extreme and costly MOG changes. The Abbott Government, for example, undertook one of the largest and most complicated MOGs in the history of Australian Government when it moved the Indigenous Affairs function into Prime Minister and Cabinet

A better way?

Given that governments appear to incur absorbent financial costs, as well as significant human stress (and associated losses in productivity), Machinery of Government changes should be used prudently.

Recently, we have expanded our research into MOGs to other Westminster systems. We have found that Canada takes a much more conservative approach to the re-shaping of the public sector.

High ranking officials in the Canadian Government explained that they use Cabinet Committees as a coordination tool instead of MOGs. Committees are created around issues of central importance to the government of the day. Currently, the Canadian Government has 12 Committees. This structure, while creating a heavy workload for Ministers, means that the public service does not require structural changes to the bureaucracy. Moreover, by taking responsibility for particular issues (usually a so-called wicked policy problem), committees become a mechanism for integration across government departments.

The other key difference that enables the Canadian government to lean less heavily on structural change is the willingness to locate more than one Minister within a department. In Australia, historically each Minister is responsible for a portfolio, which is reflected by the structure of a department (who supports that Minister).

In contrast, Canadian departments have multiple Ministers. We found that they create teams within large departments that answer to a primary Minister (though they may brief more than one). In doing so, the Canadian government uses branding instead of re-structuring to put its ‘stamp’ on the bureaucracy.

If similar approaches were adopted in Australia, we could significantly reduce the administrative costs of government – allowing more public money to be spent on policy delivery.

Posted by Luke Craven.