A wide-ranging review of the Australian public sector has found its digital capabilities are trailing comparable governments and failing to meet public needs and expectations despite significant investments in IT over the last decade.

A lack of accountability, siloed agencies, legacy systems, outdated procurement models, and a Digital Transformation Agency lacking authority means the APS needs “pervasive change across all levels of the organisation” to catch up to its global counterparts, according to the Independent Review of the Australian Public Service.

The review calls for a comprehensive audit of ICT systems and more than $250 million to be invested in digital skills each year for the next four years to address the problems and drive transformation.

But experts say a fundamental change in APS culture is also needed to deliver digital initiatives, something that is being undermined by outsourcing and the Morrison government’s insistence on a public sector that focuses on delivery.

Trailing the pack

Currently, Australia remains well behind countries like Estonia, Denmark, New Zealand, the US, and the UK, leaving the country in the “digital literate” phase of its digital journey, not yet performing or leading, according to the review.

Source: Independent Review of the Australian Public Service.

Conducted by former Telstra CEO and current CSIRO chair David Thodey AO, the long-awaited review announced in 2018 was released on Friday, three months after it was delivered to the government.

“There has been long-running underinvestment in the APS’s people, capital and digital capability, while siloed approaches, rigid hierarchies and bureaucratic rules create barriers to effective delivery,” the report says of the APS overall.

In its response the government has agreed fully to 15 of the 40 recommendations, and agreed in part to 20. Of the recommendations on digital, the government has agreed in part or to all of them.

But experts say there is a lack of political will to drive a true digital transformation in the APS and efforts are being undermined by steady outsourcing.

A ‘different animal’

Dr Bruce Baer Arnold, assistant professor, School of Law, University of Canberra says transformation of government is a “different animal” from the corporate world. 

The nature of government means it is especially difficult – though not impossible – to make the major overhauls required by digital transformation, according to Arnold.

He says many ministers are only “tinkering around the edges” on digital initiatives and the lack of political will or capability within the APS means the major changes proposed in the Thodey review are unlikely.

Dr Bruce Baer Arnold, assistant professor, School of Law, University of Canberra. Image: Canberra.edu.au

“A bit of sticky tape here, a bit of chewing gum there, chop this out, stick this on, hope it works,” Arnold said of the government’s typical approach to digital. 

“And we see [that leads to] problems with the Census, problems with the ‘Robodebt’, problems with the digital health record.”

Arnold told Which-50, years of steady outsourcing in the APS and a failure to overhaul ICT systems are making the transformation especially difficult.

“The imperative has been to cut numbers within government. Typically, you’ve lost expertise. The bureaucracy is [now] very reliant on outside expertise.”

The government’s response to the review, Arnold says, was predictably filled with “fluffy” buzzwords but lacked strong commitments. 

“You start looking at the specifics of the response and it all starts to look very vague. From a public sector management perspective the approach seems to be ‘we’ll be agile, disruptive and innovative’ – all the magic buzzword the consultants give you.”

Arnold says he doubts whether the government’s response and overall digital strategy will lead to either increased delivery or innovation. It first must address the culture within the APS and empower a naturally conservative institution. 

“There are no real rewards for middle level public servants being disruptive, being innovative, asking hard questions, that sort of thing,” Arnold said.

“And that’s been very much accentuated under [Prime Minister] Morrison where he’s making it very, very clear the public service ‘just needs to deliver’.” 

Digital ambitions

The Thodey review sets an ambitious target for a “data driven and digitally enabled APS” by 2030 but warns its digital transformation needs to accelerate from its current pace to achieve the goal.

CSIRO Chairman David Thodey.

“Acceleration is necessary because, despite these investments, the APS is not keeping pace with increasing public expectations,” the review says.

“While pockets of excellence exist and are being developed across the APS, data and digital is under-utilised in many areas, including in service delivery and policy and program evaluation.”

The review says Australia has some strong foundations and could be a digital leader by 2025, passing the current status of all leading countries and the global average of telcos, airlines and banks.

However, currently there are problems with funding, procurement, organisational structures, and skill levels, the review says, preventing the whole of government initiatives required to become a digital leader.

The agency which is supposed to drive such agendas, the Digital Transformation Agency, lacks authority and has been resigned to a limited advisory role in many cases, the review found. It recommended the DTA be one of the first entities to undergo a capability review.

According to the Thodey review, the DTA should continue to support Services Australia in its overhaul of digital delivery but in the medium to long term “digital functions could be transitioned to a standalone central department led by a secretary”.

A $250 to $300 million investment in digital and data skills per year over the next four years and a full audit of ICT is also needed to undertake digital transformation, according to the review.

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