Five ways the public service could change under the Albanese government

The Albanese government is expected to stamp its mark on the bureaucracy with changes to senior leadership, staffing numbers, consultancy spending, workplace relations and policy.

It could also reassemble departments that make up much of the public service, after former prime minister Scott Morrison reduced them in number.

Here are five key areas public servants will most likely notice changes, in the weeks and months ahead.

Expect movement at the senior level of the public service. Already Phil Gaetjens is on leave from his role leading the Prime Minister's Department, after Prime Minister Anthony Albanese made it clear in the election campaign he would replace Mr Gaetjens. Mr Albanese on Monday confirmed he would announce a new appointment.

Among names emerging as potential candidates to lead the Department of the Prime Minister and Cabinet is Mike Mrdak, a former PM&C official who also led the Infrastructure Department when Mr Albanese had the portfolio. Treasury secretary Steven Kennedy is also thought to be a possibility, although new Treasurer Jim Chalmers will likely want him to stay put.

Mr Albanese may remove and reshuffle other secretaries, especially with secretary retirements ahead. He will reveal more after returning on Wednesday from the Quad meeting in Tokyo and announcing a full ministry next week.

Until then, it's worth paying attention to the officials Mr Albanese and Foreign Affairs Minister Penny Wong took with them to Japan, indicating who they might work closely with in government. They brought Office of National Intelligence director-general Andrew Shearer and Defence Department secretary Greg Moriarty. Department of Foreign Affairs and Trade secretary Kathryn Campbell, who was appointed to the role by Mr Morrison, is not on the trip. DFAT deputy secretary and Quad senior official Justin Hayhurst accompanied Senator Wong to Japan.

One of the stalwarts in the senior levels of the public service, Finance Department leader Rosemary Huxtable, intends to retire, so incoming Finance Minister Katy Gallagher will probably have a new department secretary soon.

Senator Gallagher has also said she wants to keep the public service portfolio, and if she does, public servants will have an ACT-based politician determining a lot of their industrial relations settings, which will be a change.

The new government not only has to settle its line-up of ministers. It has to decide how to structure the departments they will work with. Under the Morrison government, there were 14 departments answering to 24 cabinet ministers, including some with responsibilities in more than one portfolio. In other words, it was complicated.

Observers of the public service argue that the cabinet was too large, and that departments should be more clearly aligned with the cabinet and its ministers. Labor might agree, and adjust the number of departments and cabinet ministers.

Mr Morrison's decision to reduce the number of departments from 18 to 14 in 2019 also left Australia without a federal department with responsibility for the arts clearly stated in its name, a reflection partly of the former government's neglect of the arts sector in its decision-making. The new government could re-elevate the arts through its machinery of government changes.

Labor has promised a different approach to climate change and environment policy compared to the Coalition. It may well reflect this in its make-up of departments, including by decoupling Agriculture from Environment, in rearranging the public service. In opposition, Labor accepted the Coalition's creation of the Home Affairs Department, although it might find a way for the public service to better reflect its role in immigration.

One of Mr Morrison's signature changes to the public service was to downgrade the former Department of Human Services, now named Services Australia, to an agency after years of drastic downsizing under both the Coalition and Labor. It remains to be seen whether the new Labor government embraces that change, or flags a reversal to years of outsourcing under the Coalition by making it a department again.

The Coalition reduced and capped public service staffing. While its approach softened for some portfolios in recent years, the public service's growth was relatively subdued given the increase in Australia's population.

One of Mr Albanese's very first remarks as Prime Minister was that his government would not sack public servants. That's not all of it.

Labor wants to abolish caps on public service staffing, which it argues have simply driven a rise in wasteful spending on outsourcing as departments and agencies have tried to keep up with their workloads. The new government will also audit labour hire roles within the public service to ensure fair conditions and pay.

It plans to cut up to $3 billion in spending on consultancies and contractors over four years, and restore 1000 jobs at service delivery agencies including Services Australia, National Disability Insurance Agency, and the Department of Veterans' Affairs - all of which Labor argues have encountered major issues because of their over-reliance on labour hire.

Expect the public service's overall staffing to rise not only in these departments and agencies, but across the federal bureaucracy, after years of cuts and then muted growth under the Coalition.

The Coalition took a hard line on industrial relations in the public service when it came to government, and what followed were years of conflict - culminating in a Fair Work determination setting conditions at the Home Affairs Department.

That later settled into a stalemate where employers and staff simply agreed on pay rises while keeping conditions in expired agreements to avoid negotiating under the Coalition's workplace bargaining restrictions. Unions described the restrictions as unworkable and blamed them for complicating talks between public servants and bosses. As a result, bargaining has been at something of an impasse for much of the public service, not a good place to be for a workplace that wants to compete for talent.

That will likely come to an end, as Labor plans to abolish the cap on wage rises first imposed by the Abbott government and later tied to the wage price index under the Morrison government. It also says it will remove the rule against overall enhancements to workplace agreements.

Mr Albanese during the campaign declined to promise higher public servant wages. Senator Gallagher later said it was simply responsible, and not a surprise, that he spoke in general terms about how Labor would approach enterprise bargaining, as the prospective head of negotiations. She said Labor would bargain with public servants and unions in good faith on "reasonable" wage rises based on productivity gains.

Public servants won't get everything they want in the next rounds of bargaining, but it's fair to predict they'll have a more open negotiating party across the table in Labor.

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Mr Morrison told public servants their main role was to implement and advise on policy, and deliver services, not set policy. The comments were widely interpreted as the then-prime minister telling the public service its purpose was service delivery, not forming policy. His government also spent up on advice from consultancy firms, a tendency that would not have helped the "hollowing out" in policy advising that observers and critics say have undermined the public service.

The Albanese government's plans to cut consultancy spending means it will need to take that advice from other sources, and it can't just come from inside ministerial offices. It will turn to public servants for ideas, expertise and policy design. The question will be whether it's impressed, or served well by, what it receives from the public service after the kind of declines in policy advising skills raised during the recent Thodey review. It also remains to be seen whether the public service has kept pace on climate policy under the Coalition, and has policy advice that will match Labor's stance in ambition.

Mr Albanese has said he would respect public servants, and singled them out for praise in his first press conference as Prime Minister on Monday. It's a signal that the new government will bring them more into the tent when it comes to policy advice.

It might be a longer-term exercise to restore policy advising skills and bring experts back in-house, so Labor may gradually turn down the tap on government consultancy spending. If it's serious about making this change, it will have to start some time.