Who is really in charge of the Defence Department? Many would guess the military chiefs, which is logical enough. Some would even say the Minister—civil control and all that. Or perhaps, given the recent discussion about the influence of Ministerial advisers over the public service, others would suggest we should be looking to the Secretary—Sir Humprey always did seem to get his way.
Another way to ask the question would be to consider who got the blame when reviews such as Rizzo, Black and Coles highlighted a lack of accountability, confused responsibilities and dysfunctional linkages between levels of authority across the Department? No clear answers there.
There is something even more telling, however, than the inability to identify who is really in charge of Defence. How is it that so many commentators can describe what has gone wrong, but so few ask why, or attempt to suggest a better way? It’s said that a fish rots from the head. If we accept that organisational dysfunction stems from problems at the head of Defence, perhaps that’s where we need to start—at the top. But just what is the relationship between executive Government and the Department?
Distant could be one way to describe the relationship. The Defence Minister sits on one side of Lake Burley Griffin and the Department on the other—literally and figuratively. Even those Ministers who choose to engage with Defence in a more proactive way don’t actually get much formal insight into ‘the process’ that leads to the briefs they receive. For example, how much ‘re-drafting’ by the many layers of review has the brief received in the time between leaving the subject matter expert and being delivered to the Minister? Does the brief still say the same thing, or have the priorities and agendas of other groups (or the central agencies) transformed the message? The Minister would seldom know, because Defence has a policy to ‘speak with one voice’, which limits the ability of the Minister to hear dissenting views where they exist.
On the other side of the equation, the brief the Minister takes to the National Security Committee of Cabinet (NSCC) may not actually reflect recommendations made by Defence. Think of the Super Hornet acquisition by Minister Nelson, a decision made without the recommendation of Defence. While the Minister was happy to own that particular decision, not all such Ministerial interventions are quite so transparent. The point is that accountability has to flow both ways in a functional relationship. Changes to submissions instigated by the Minister, or by Ministerial advisers, should always be formally captured in an auditable process. The Government also needs to be aware of the true opportunity cost of decisions it makes. Decisions to approve additional operational commitments or even to defer an acquisition have flow-on effects for planned training, maintenance activities, logistics contracts, personnel and defence industry.
Is there a better way? Certainly most successful public, not-for-profit, and even private companies seem to think so. Most of them adopt the construct of a governing board. This provides a proven framework for structured engagement between key elected stakeholders (directors) and the executives who have operational control. Through the board, the Chair is able to provide strategic guidance to the organisation, and hold executives to account for performance, and compliance with relevant regulations. The board doesn’t run the organisation on a day-to-day basis, but it has insight into the internal and external environments that shape the CEO’s challenges and decisions. Some private companies also choose to have a board of reference, which provides a structured means of retaining corporate memory, as well as obtaining a broader perspective on current issues and strategic direction.
The 2011 review by Lord Levene (PDF) for the UK Ministry of Defence confirmed that the model of a board can work for Defence. The Secretary of State (Minister) chairs the Board and is advised by the Chief of Defence Staff, the Permanent Secretary, the Procurement Executive, as well as non-executive directors who bring broader perspective and experience to the table.
In the Australian context, a Defence Board wouldn’t replace the role of the NSCC. The Board would provide a structured, regular forum for the Minister to engage with, and be informed by, a range of voices within Defence. It would enable him to be a more effective decision maker when dealing with the Department, and speak with more confidence and authority in NSCC when advocating for the Department.
For the Board concept to be effective in Australia, we’d need to redefine the roles of some senior appointments. This would include empowering the Service Chiefs to have command and control over all the resources they need to do their job—a pre-requisite for accountability to the Minister as Chair of the Board. A consequence of the increased control for the Service Chiefs would be a corresponding decrease in the number of groups within the Defence Organisation. This would be balanced by making the Secretary responsible for overseeing compliance both with strategic guidance and with policies relevant to achieving best-practice in non-operational matters across the three services. The Minister would then be in a position to make informed decisions on what should be done, to hold Service Chiefs accountable for subsequent outcomes, and to judge their efficacy in the task. Where exigencies require changes, trade-offs or exceptions to guidance, the Board provides a framework for these issues and the related flow-on effects to be assessed, debated and implementation coordinated.
The structured framework of the Board would also provide some degree of quality assurance for the taxpayer when the personalities, interests, or competence of the Chief of Defence Force (CDF), Secretary and Minister did not align as well as we might hope or expect. To return the rotting fish analogy, the Defence Board and the associated changes in senior roles would see the head of the organisation model the approach that must be adopted at all levels within Defence: informed decisions by accountable individuals.
The Defence Board in and of itself would not be a silver bullet to address the oft-lamented failures in the Defence Organsisation. It is, however, the right place to start fixing the rot—at the heady interface of Minister, Mandarins and Military.
Senator David Fawcett is a Liberal Party representative for South Australia. He was a member of the Senate Foreign Affairs, Defence and Trade enquiry into Defence Acquisition. His additional comments to the report (PDF) argue that the changes to Governance discussed above are just one aspect of the suite of reforms to the Australian Defence Organisation required to achieve effective and sustainable change.