Governance

The department promotes a sound governance culture that meets its performance and accountability requirements under the Public Governance, Performance and Accountability Act 2013 (PGPA Act). Its governance framework includes committees which are established to provide leadership, oversee decision making and ensure effective service delivery. These committees also embed the governance fundamentals of transparency, collaboration and performance.

During 2017–18, the department continued to implement the PGPA Act’s requirements while also ensuring that arrangements were in place to help staff plan for success (Strategic Plan, Corporate Plan and Business Planning), define and manage risk in line with the department’s risk appetite, and regularly monitor their performance.

Business planning

Business planning within the department involves developing forward plans for each cluster, group and branch. The plans outline priorities for the year ahead, strategies for achieving these and how success will be measured.

Business plans are an important link between the strategic plan, corporate plan and individual performance agreements. They set strategic priorities into actions, define deliverables and ensure accountability.

Staff are encouraged to refer to their business plan when building individual performance agreements. This approach helps drive performance, increase engagement and build capability, while positioning individuals to understand how their work contributes to achieving the department’s purpose.

As part of the business planning process, the executive and each group’s leadership team met twice during the year to discuss the objectives, processes and challenges outlined in their respective business plans. These meetings afford an opportunity to review progress towards the delivery of outcomes.

The Executive Meeting

The Executive Meeting is the department’s primary governance body. It supports the Secretary as the accountable authority in delivering outcomes, strategic decision making and operational matters. It also promotes the core principles of good public service governance by ensuring the department adheres to all applicable standards and legislative requirements, acts impartially and delivers with integrity. It is chaired by the Secretary and attended by the three deputy secretaries and meets fortnightly.

Committees

The department’s governance committees support the Executive Meeting by helping report, make decisions, deliver the Government’s objectives, achieve the department’s purpose, and comply with the department’s obligations. At 30 June 2018, the department had six governance committees:

  • The Audit Committee helps the department comply with its obligations under the Public Governance Performance and Accountability Act 2013 by providing independent advice and assurance to the Secretary on the department’s control framework, including financial and performance reporting, and risk oversight and management. The committee also provides a forum for communication between the Secretary, senior managers, and the department’s internal and external auditors.
  • The Finance and Business Services Committee oversees and advises on whole-of-department activities around organisational efficiency, capability building and corporate management. The committee also oversees the department’s risk framework, fraud control and protective security.
  • The Information Technology Committee ensures strategic use of IT resources within the department. It plans and directs a program of work around IT objectives, and makes IT investment decisions. The committee also oversees the IT risk framework.
  • The People and Capability Committee manages the department’s people and organisational strategies. It also helps the department comply with its work health and safety obligations, and diversity goals. The committee helps implement the department’s innovation framework, work force planning, staff development and leadership.
  • The Strategic Policy Committee operates as a policy think tank, focusing on emerging cross portfolio priorities and longer-term policy issues. It provides a forum to exchange, test and challenge new ideas about current and future priorities and policies.
  • The Data Digital and Privacy Committee oversees implementation of the Government’s data agenda across the department, as well as the Digital Transformation Agency’s digital delivery agenda and the National Archive’s digital continuity agenda.

The committee structure integrates with other governance arrangements such as the department’s core strategic level documents (including the corporate and strategic plans), subcommittees and interdepartmental committees. The department also has a number of consultative committees, steering committees and working groups that support, monitor, consult and share information.

The Audit Committee meets quarterly, and each of the other committees usually meet every second month, with additional meetings when necessary. Activity reports are provided to the Executive Meeting to help monitor progress and performance.

The department’s management committees consist of leadership forums for the two business groups (Employment Cluster, and Workplaces and Small Business cluster). They are convened to promote principles of good governance across all levels of their respective cluster. The Senior Management Meeting convenes weekly and consists of the executive and all group managers. This forum provides a shared management perspective on strategic and operational issues.

The department conducts an annual health check of its governance arrangements.

Finance and Business Services Committee

The Finance and Business Services Committee oversees the department’s corporate strategies for meeting its business goals. It considers opportunities for driving business efficiencies and for supporting innovation and organisational capability. The committee was co-chaired by the Deputy Secretary Employment and the Deputy Secretary Corporate. Membership includes a cross-section of management levels and organisational areas from throughout the department. The committee met seven times during 2017–18.

The committee will continue to oversee the department’s risk management framework including developing strategies to respond to areas identified as needing improvement. It values broad employee engagement in promoting departmental initiatives.

The committee’s focus for 2018–19 includes:

  • implementing communication and training initiatives to ensure transparency and accountability, and increase knowledge across the department
  • improving business practices and reducing internal red tape, and
  • ensuring the department maintains a strong risk management culture.

The Information Technology Committee

The Information Technology Committee advises the Executive on departmental IT capabilities, strategy, risk, investment and priorities, and oversees IT strategy implementation.

Steering committees in the department’s two ICT groups manage the investment portfolio and services, and support the Information Technology Committee in delivering the strategy and work program, including risk management.

The Strategic Policy Committee

The Strategic Policy Committee (formerly the Strategy Committee) operates as a policy think tank and focuses on emerging cross portfolio priorities. As well as considering and influencing longer term strategic policy issues, the committee advises the executive on progressing short to medium-term departmental and whole-of-government policy priorities. It also helps engage external stakeholders on emerging policy issues.

The committee’s membership structure and terms of reference were reviewed during the year. Key reforms included reviewing membership to ensure wide representation from policy areas including the new small business function, promoting the committee’s role across the department and a name change to reflect the committee’s focus on whole-of-government and departmental policy issues.

The committee considered a range of strategic issues during the year such as the impact of migration policy on the labour market, future of labour market assistance, developing a behavioural tax and transfer model, regulatory settings, research on redundancy, and seasonal work. The committee also endorsed updates on the department’s forward research agenda and data strategy.

Through the committee’s policy discussions in the year ahead, the department will continue to collaborate with other agencies to influence and provide policy advice on the future of employment services, best practice regulation, the future of work project and small business initiatives.

The Data, Digital and Privacy Committee

The Data, Digital and Privacy Committee was established by the department in early 2018 to:

  • Provide oversight of the development of implementation plans and awareness across the department for whole of government data and digital agendas.
  • Oversee and guide implementation of the Public Sector Data Management Agenda and provide recommendations pertaining to scope, role, structure and resources for implementation following the outcomes of the PM&C Data Review.
  • Oversee the development of implementation plans relating to digital transformation agenda activities.
  • Oversee and guide implementation of the corporate strategies relating to data, digital and privacy management, e.g. risk strategies.
  • Ensure the Department of Jobs and Small Business meets targets outlined in the Digital Continuity 2020 policy, including a comprehensive information management governance framework.
  • Set up a framework to identify crossover of work and consistency where possible within the following streams:
    • Whole of Government Data Agenda
    • Digital Continuity 2020 Policy
    • Data and Digital Management Project
    • Notifiable Data Breaches Scheme; and
    • Assessment of privacy risk and carrying out privacy impact assessment as required by the new Privacy Code

Behavioural economics

The department continued to build its behavioural economics capability in 2017–18 and apply this to evidence-based policy and program development. Behavioural economics projects incorporate user-centred design, innovative policy ideas, and a rigorous trial and adapt approach. This capability helps provide a realistic understanding of the behaviours and decision-making of job seekers and employers. It also can help identify and address otherwise hidden psychological obstacles that might affect the choices of job seekers, employers, service providers and employees. To see what works, the department tests a variety of behavioural economics interventions using randomised controlled trials, the ‘gold standard’ for measuring improvements to policy and program outcomes.

The department has a number of behavioural economics trials underway to support effective policy and program design and implementation. This year, there was a particular focus on simple and cost-effective online methods to encourage better outcomes for job seekers.

Evidence gathered from completed trials has been incorporated in the design of policies and programs. A key achievement in 2017–18 was publishing the report Applying behavioural economics to increase the take-up of wage subsidies. This is available on the department’s website. It outlines the behavioural economics approach in the department, and reports on the successful findings from this project. Results from the trial were used to fine-tune operational policy changes to the wage subsidies program.

Innovation

Innovation at the department means putting ideas into practice to add value for its people, stakeholders and clients. 

The department continued driving and influencing the innovation agenda through the National Innovation and Science Agenda and Public Sector Innovation Network. The work is guided by the Innovation Framework 2016–2018 which focuses on four priorities. Activities over the last 12 months include: 

1.  Evolving our organisation’s capability and unlocking our people’s expertise. 

  • Increasing the use of multi-disciplinary teams and project based approaches. 
  • Using IT to enable greater collaboration and productivity. 
  • Implementing more flexible working arrangements. 
  • Encouraging people to bring the whole person to work through a range of internal networks and forums.

2.  Designing policies and services by applying user centred design to meet the diverse needs of our stakeholders. 

  • Building our internal capability through our User Centred Strategy, launched in September 2017, and embedding user centred principles in our policy design and service delivery. 
  • Speaking with job seekers, providers, employers and other community members to get a better understanding of stakeholder experiences of government services. 

3.   Exploring a variety of policy levers and non-legislative approaches. 

  • Using our internal ideas management system—Spark—and external platform—MindHive— to crowdsource ideas on policy topics. 
  • Applying behavioural economics to trial and tailor approaches before national roll outs, and to achieve better outcomes for job seekers and employers. 

4.  Demonstrating the value we create for our people, stakeholders and clients. 

  • Using our APS census data to measure our innovation activities, and identify priority areas for development and support. 
  • Showcasing innovation through case studies and events. 

The department continued to build its innovation culture and capability. Activities included collaborating with other APS agencies to run Innovation Month and help junior staff learn how to apply innovation through our annual Shark Tank initiative.

The Evaluation, Research and Evidence Framework 2015–2020

The Evaluation, Research and Evidence Framework 2015–2020 sets out the forward plan to strengthen our evidence base and make sure that the right evidence and insights are available to inform policy and program decisions.

Achievements under the framework in 2017–18 include:

  • supporting research activities, including 13 projects examining job seeker characteristics and motivations, workers’ health and safety and employment outcomes for Indigenous Australians, pre-release prisoners and migrant workers
  • launching the Department of Jobs and Small Business’s Staff Discussion Paper Series so staff can publish and disseminate their research and analyses to a broader audience
  • continuing our commitment to publish evaluation and research reports, including the Tasmanian Jobs Programme evaluation and The Australian Recruitment Industry – a comparison of service delivery 2016 research report. This ensures this work informs our broader policy and service delivery context, and
  • updating the Research and Evaluation Services panel to include a new user-centred design services category. The panel supports the research and evaluation work of the department and other Australian Government agencies. At 30 June 2018, panel members had been engaged for 269 projects; 79 of which are being undertaken by the department.

Regulatory reform 

The department and its agencies are working to reduce the regulatory burdens facing business, community organisations, individuals and families. Among our achievements during 2017–18 was automating the process for jobactive providers to record hours of paid part-time and casual employment undertaken by job seekers. This change will save almost $11.3 million in regulatory burden a year by replacing a time consuming manual process.

In 2017–18, the jobs-related regulators (Fair Work Ombudsman, Fair Work Commission, Safety, Rehabilitation and Compensation Commission, Comcare, Registered Organisations Commission, Australian Building and Construction Commission, Office of the Federal Safety Commissioner, and the Workplace Gender Equality Agency (transferred to the Department of the Prime Minister and Cabinet on 19 April 2018) — completed their second self-assessment under the Government’s Regulator Performance Framework.

Risk management 

In June 2017, the department delivered its new enterprise risk management system, RiskNet. The system is designed to help staff better assess risk, and will provide clearer and more meaningful information for those responsible for accepting risk plans. RiskNet incorporates the department’s new risk appetite statement and matrix, enabling staff to easily and accurately assess risk against the department’s tolerance levels. It enables a strategic risk view to be maintained, similar risks to be easily grouped and tracked, and risk to be rated consistently across the department.

The department’s strategic risk statement was approved by the Secretary in November 2017. This document highlights priority focus areas of potential exposure to uncertainty. It helps to recognise risks when encountered, and provides advice on how to manage them effectively. Along with the risk appetite statement, the strategic risk statement is used to guide decision-making risk management and resource allocation.

The Finance and Business Services Committee—where risk is a standing agenda item—oversees risk management. The department consistently achieves strong results in the Comcover Benchmarking Survey of risk maturity, demonstrating a well-embedded and mature culture of risk management.

In August 2017, the Australian National Audit Office (ANAO) published a performance audit on The Management of Risk by Public Sector Entities which included the department. The ANAO found the department had a mature and integrated approach to identifying and managing risk, and had implemented a range of measures to build its risk capability, including an enterprise-wide risk management system.

Fraud control

Fraud and corruption can damage the performance and reputation of Australian Government programs. The department seeks to minimise these risks by preventing, detecting, investigating, recording and reporting instances of fraud and corruption through policies, procedures and practices that align with the Commonwealth Fraud Control Framework.

The department developed an expanded fraud control strategy in February 2018 in line with the Commonwealth Fraud Control Framework. This strategy is designed to communicate clearly to staff and contractors the requirements under the Public Governance, Performance and Accountability Act 2013.

The strategy promotes continuing maturity of the department’s fraud control culture and ensures our approach is consistent with other Commonwealth agencies.

The Serious Non-Compliance and Investigations Unit operates within the department’s compliance framework. It assesses and manages serious non-compliance and fraud, deals with incidents promptly and effectively, and maintains a register of these. The unit also works with program assurance and risk management areas to ensure the department responds to issues appropriately.

In 2018–19, work will continue to develop the department’s fraud prevention strategy and to implement a fraud prevention training plan. The unit will also focus on developing an approach to mitigate the risk of fraud from external providers engaged in activities funded by the department.

Internal audit 

The internal audit function is a central component of the department’s governance framework. The internal audit function serves to strengthen accountability and promote good governance and transparency through the provision of independent and objective assurance. In this way, internal audit adds value to and improves the department’s operations and its performance.

The internal audit team helps foster a culture of accountability, integrity and high ethical standards by encouraging debate and collaborating with internal and external stakeholders to build and share information and knowledge. The team reinforces the appropriate use of Commonwealth resources, value for money considerations, self-assessment and continuous improvement throughout the department.

In 2017–18, the team:

  • delivered an audit program that was responsive to the department’s changing needs and priorities
  • reviewed all tabled Australian National Audit Office (ANAO) performance audit reports and disseminated key findings and relevant information to appropriate officials
  • continued its ‘no surprises’ audit approach through open communication with stakeholders
  • attended and provided information and advice to departmental governance committees to support their decision-making and build productive working relationships
  • facilitated the ANAO’s annual financial statements audit, as well as five ANAO performance audits and one assurance review, and
  • monitored implementation of internal and ANAO audit recommendations and helped business areas implement the recommendations.

The department’s 2017–18 internal audit work program was developed following consultation with the executive and the department’s senior executive service. The program was approved by the Audit Committee in June 2017 with a suite of 15 audit activities. These were designed to address key aspects of the department’s control framework and support program and process performance.

In 2018–19, the internal audit team will:

  • encourage better internal practices with ongoing reviews of processes and functions
  • help the department strengthen its accountability and performance, and promote good governance and transparency
  • provide advice and guidance on better practice, and
  • support the Audit Committee in fulfilling its roles and responsibilities.

Audit Committee 

The department’s Audit Committee is established in accordance with section 45 of the Public Governance, Performance and Accountability Act 2013 (PGPA) and section 17 of the PGPA Rule 2014. It functions in an oversight and review capacity to provide independent advice and assurance to the Secretary on the Department’s financial reporting, performance reporting, and control frameworks.

An independent audit committee is an important element of good governance. To support this, and as required under PGPA Rule 2014, the department’s Secretary and Chief Financial Officer do not form part of the committee. The appointment of external members to the committee strengthens its independence. An external member chairs the committee.

Throughout 2017–18, the committee had five members. The majority of committee members are external to the Department, and all members have a distinguished background in one or more of public sector management and service delivery, financial management and accounting standards, information technology and governance. In 2017–18, the committee met five times. ANAO representatives observed and made presentations at these meetings.

In 2018–19, the Audit Committee will continue providing independent advice to the Secretary to inform decision-making on the department’s accountability and control framework. Through this advice, the committee also supports the Secretary to meet her obligations.