Annual Report

Domestic policy

Domestic policy covers a wide range of issues - economic, environmental and social - that have a profound effect on the lives of all Australians.

Six divisions comprise the Domestic Policy Group. These are:

  • Social Policy Division
  • Industry, Infrastructure and Environment Division
  • Office of Work and Family
  • Economic Division
  • Strategy and Delivery Division
  • G20 Policy Division (see the Group of 20 (G20) Meeting 2014 performance report at page 47).

While it operates independently of the Department, the Council of Australian Governments Reform Council (CRC) is also an important component of our domestic policy program. Directed by the peak intergovernmental forum in Australia, the Council of Australian Governments (COAG), the CRC provides objective, credible assessments and reporting on the performance of State and Territory Governments in key areas of national reform.

Highlights 2012–13

This year, the Domestic Policy Group advised the Prime Minister and the Cabinet and worked with other departments and, in some cases, State and Territory Governments to progress critical, high-profile policy initiatives, including:

  • developing the proposed Schools Funding Reforms and the National Plan for School Improvement in response to the 2011 Review of Funding for Schooling
  • negotiating launches and full scheme agreements with State and Territory Governments for the National Disability Insurance Scheme (NDIS)/DisabilityCare Australia (DCA)
  • supporting the implementation of the Australia in the Asian Century White Paper
  • working with the Department of Health and Ageing (DoHA) to develop the Government’s Dental Reform Package
  • leading negotiations across Government to extend a National Partnership Agreement (NPA) to oversee disaster recovery and reconstruction work following the floods caused by ex-tropical cyclone Oswald in January 2013
  • supporting the establishment of the Australian Charities and Not-for-profits Commission to support a robust, vibrant, independent and innovative not-for-profit sector
  • assisting development of significant intergovernmental agreements (IGA) including the National Education Reform Agreement; and agreements for Tasmanian Forests and Water Reform in the Murray-Darling Basin
  • working with the Department of Finance and Deregulation to establish the whole of government Efficiency Working Group supporting the Prime Minister’s Business Advisory Forum held in Canberra on 6 December 2012 (which discussed progress on key regulation and competition reforms agreed by COAG)
  • supporting three meetings of COAG in which significant social, economic and environmental reform agendas were agreed and progressed
  • advising the Prime Minister on implementation of the Government’s response to the Fair Work Act Review, ongoing implementation of consumer credit reforms, and a register of foreign owned agricultural land
  • advising and coordinating support to help deliver the 2012–13 Mid-Year Economic and Fiscal Outlook and 2013–14 Budget
  • establishing the National Panel for Economic Reform (NPER), including initial meetings on improving education and training systems and supporting productive workforces.

Figure 2.1 KPIs for the Domestic Policy Group

Domestic policy (Program component 1.1.1) Met
High level of satisfaction of the Prime Minister, the Cabinet and Cabinet committee chairs, Portfolio Ministers and the Parliamentary Secretaries with the quality and timeliness of advice, briefing, activities and/or support.
High level of satisfaction of the Prime Minister and of other agencies with the Department’s contribution to COAG. Successful coordination and support for COAG meetings and ensuring a well-coordinated delivery of the broad COAG agenda.
Satisfaction of other central agencies, portfolio departments and other key stakeholders, with the cooperation and collaboration of the Department.
Number of individuals assisted towards volunteering: 250,000
High level of satisfaction with the quality of support provided by the departmental secretariat to bodies supported by the Department, including the Australian Social Inclusion Board and the Not-for-Profit Sector Reform Council.
Grants are administered in compliance with reporting mechanisms, objectives and other provisions of the grant funding deeds.
Compliance with all relevant legislation.

Social Policy Division

The Social Policy Division advises on significant social policy issues that affect the Australian community, including early childhood and school education, health and ageing programs, arts, sport, employment and immigration. Our advice is developed and informed by consultations with Commonwealth, State and Territory departments as well as with industry and community stakeholders.

We work in an environment of challenging policy reform, requiring detailed policy analysis and implementation oversight. In 2012–13 key reform areas that we advised on included dental and mental health reform, early childhood and school education, and the development of Australia’s first national cultural policy in almost 20 years.

Dental health reform

We worked closely with DoHA to develop the Government’s $4.1 billion Dental Reform Package which contains three initiatives: Grow Up Smiling, a child dental benefits schedule; an NPA for Adult Public Dental Services; and a Flexible Grants Program. Under the NPA, the Government will provide $1.3 billion to the State and Territory Governments from 1 July 2014 to expand public dental services for adults, assisting up to 1.4 million low income adults. In addition, we worked with DoHA to develop the Government’s support package for public dental waiting lists, which will benefit 400,000 people.

Mental health reform

Working with DoHA and the State and Territory Governments, we supported COAG’s agreement to the Roadmap for National Mental Health Reform 2012–2022 (the Mental Health Roadmap). This commitment will assist in improving the lives of people with mental illness, their families, carers and communities. Complementing the release of the Mental Health Roadmap, we were closely involved in the establishment of the new COAG Working Group on Mental Health Reform that will implement the Mental Health Roadmap in practical terms.


We led the Department’s input to finalise Commonwealth commitments for Australia’s hosting of the 2015 Asian Football Confederation Cup, and joint hosting with New Zealand of the 2015 International Cricket Council Cricket World Cup.

Cultural policy

We worked closely with the Office for the Arts in the Department of Regional Australia, Local Governments, Arts and Sport (DRALGAS) to develop Creative Australia, the first national cultural policy in almost 20 years.


In partnering with the Department of Immigration and Citizenship (DIAC) to implement the Government’s multicultural policy, The People of Australia, we supported the Government’s Response to the Access and Equity Inquiry. This has been complemented by ongoing work on a number of issues driven by multicultural and community groups, contributing to the celebration and promotion of diversity and supporting a broad range of culturally and linguistically diverse communities and organisations.


In collaboration with the Department of Education, Employment and Workplace Relations (DEEWR) we monitored the delivery of the Building Australia’s Future Workforce package, a centrepiece of the 2011–12 Budget, designed to build a more educated and skilled workforce and provide opportunities for Australians to experience the benefits of work. In addition, we supported the review of Employment Services that will determine the delivery of services when current contracts for Job Services Australia and the Disability Management Service expire in June 2015.

Schools and Early Childhood

We supported the negotiation and development of the new NPA on Universal Access to Early Childhood Education, which provides $660 million over 18 months to support the State and Territory Governments in providing universal access to early childhood education.

Industry, Infrastructure and Environment Division

The Industry, Infrastructure and Environment Division advises on matters relating to industry, innovation, energy, resources, small business, tourism, climate change, the environment, water, agriculture, fisheries, forestry, customs, skills, research, tertiary education, infrastructure, transport, regional development, communications and the digital economy.

Industry, skills and innovation

We provided advice to the Prime Minister on A Plan for Australian Jobs – the Australian Government’s Industry and Innovation Statement, developed by the Department of Industry, Innovation, Climate Change, Science, Research and Tertiary Education (DIICCSRTE). In consultation with DIICCSRTE we advised on the establishment of a priority public good funding stream within the Cooperative Research Centres program, to deliver primary research outcomes with wider social and environmental benefits. We liaised closely with DIICCSRTE and provided advice on support packages for firms subject to disproportional structural adjustment pressures.

Working with DIICCSRTE, we supported the implementation of the NPA on Skills Reform designed to provide a more efficient, accessible, equitable and transparent vocational education and training sector with higher quality training that is responsive to the needs of students, industry and employers. We also continued to provide advice on higher education policy, including implementation of demand driven funding for undergraduate university places.

We have also been involved in negotiations to progress the National Occupational Licencing Scheme, which will help deliver a consistent licencing scheme across Australia in selected trades.

Infrastructure, communications, climate change and energy

In collaboration with the Department of Infrastructure and Transport and DRALGAS, we advised on regional, transport and infrastructure issues, including finalisation of the next phase of the Nation Building Program, and the release of reports into High Speed Rail and on Wilton and Richmond as possible sites for a second major airport for Sydney.

We organised and supported the Prime Minister’s Forum on the Digital Economy held in December 2012, attended by leaders across the digital economy. Advice on emerging technology trends, such as the adoption of cloud computing, and policies required to support the growth of the digital economy were provided to the Prime Minister.

We worked with other departments to implement the Clean Energy Future Package, develop the 2012 Energy White Paper, advise on developments in gas markets and coordinate the Commonwealth’s contribution to energy market reforms endorsed by COAG in December 2012. We provided input into the Prime Minister’s priority of energy market reform and advice on reforms considered by COAG.

Agriculture, customs and environment

We supported the Department of Agriculture, Fisheries and Forestry to develop the National Food Plan and align the Plan with the Australia in the Asian Century White Paper. We also advised on drought assistance and delivery of income support to farmers in financial difficulty.

We collaborated with agencies on measures to support industry and environmental sustainability. This included advice on finalisation of the Murray-Darling Basin Plan and arrangements with Basin States. We worked with DSEWPaC to implement measures for greater environmental protection of water resources impacted by coal seam gas and large coal mining developments and advised on finalisation of the 2013 Tasmanian Forests IGA. Improving Australia’s environmental regulatory arrangements is a priority for the Government and we have supported efforts to enhance efficiency and increase certainty for business, while maintaining high environmental standards.

Office of Work and Family

The Office of Work and Family advises on a range of issues including families, seniors, disability, gambling, housing, women, children, disaster recovery, Closing the Gap for Indigenous Australians and service delivery reform. We also supported the Prime Minister and the Minister for Social Inclusion on social inclusion priorities, volunteering, social investment, philanthropy and not-for-profit reform.

Families, Indigenous policy and social support

In 2012–13 we continued our support of the NDIS Taskforce as it worked towards the rollout of DisabilityCare Australia – a new way of providing community linking and individualised support for people with permanent and significant disability, their families, and carers. We also supported the establishment of the Royal Commission into Institutional Responses to Child Sexual Abuse Taskforce.

This year we contributed to positive outcomes for Indigenous Australians, including significant progress on the Closing the Gap goals. We provided advice and support on the Constitutional recognition of Indigenous Australians, issues of native title, and engaged closely with the newly established National Congress of Australia’s First Peoples.

We worked with other departments to implement major reforms in the delivery of social services to Australians. This included work with the Department of Human Services toward a new, online government services portal, MyGov. We helped develop provisional benchmarks for both the National Affordable Housing Agreement and the National Disability Agreement. We assisted in the development of a foundation to Prevent Violence Against Women and their Children, and provided advice and support to the Prime Minister on the importance of women’s participation in society and the economy.

During 2012–13 Australia again faced a number of natural disasters that affected communities across the country. Working closely with the Prime Minister, the Queensland Government, and other Commonwealth Government agencies, we helped implement a revised NPA to facilitate Queensland’s recovery from ex-tropical cyclone Oswald.

Not-for-profit sector

We continued to support the Prime Minister with the not-for-profit agenda, including work across government to support the establishment of the Australian Charities and Not-for-profits Commission. From 3 December 2012, the Commission has sought to foster a sustainable and innovative not-for-profit sector while also promoting increased accountability and transparency and a reduction of unnecessary regulatory obligations on Australian charities. In cooperation with the sector, we developed a Code of Best Practice for Engagement with the not-for-profit sector to support stronger consultation practices and ensure that the unique value and perspective of the sector is reflected in Government policy. In addition, we continued to coordinate and administer the Volunteer Management Program, which places volunteers in the not-for-profit sector. In 2012–13 we increased this KPI by 20 per cent (50,000 people) by placing 300,000 volunteers. We also hosted the first bi-annual forum with peak volunteering bodies to strengthen engagement with the volunteering sector, and supported the relaunch of GoVolunteer, a website that matches people interested in volunteering with appropriate opportunities.

Social inclusion

With our support, the Australian Social Inclusion Board continued to provide evidence-based advice to Government on improving the quality of services and maximising the resources available to those most in need of help. The Board advised Government on a number of issues, including employment services; older women and homelessness; service delivery reform; and financial capability.

The second edition of the Board’s report on social inclusion indicators – How Australia is Faring – was released in August 2012.

Economic Division

The Economic Division provides advice on a range of economic issues affecting Australia, including the Budget, the financial sector, productivity, competition and consumer policy, regulatory reform, the international economy, foreign investment and Commonwealth-State relations.

Economic policy

We provided analysis and advice on the economic outlook and conditions of the Australian and international economy, lifting Australia’s productivity performance, lifting competition, and reducing the impact of regulation on business, governments and the not-for-profit sector.

We also provided support to the Productivity Committee of Cabinet, the delivery of the NPA to Deliver a Seamless National Economy and the Business Advisory Forum (BAF).


We worked with Treasury and the Department of Finance and Deregulation (Finance) to ensure effective coordination and support for senior Ministers’ consideration of expenditure policy proposals, both during the Budget process and throughout the year. We also supported the Expenditure Review Committee of Cabinet and advised the Prime Minister on the fiscal outlook and associated fiscal strategy.

We worked extensively within PM&C to ensure divisions had the information necessary to assess expenditure proposals, we provided guidance on expenditure accounting and presentation of financial information, and contributed to the assessment of new policy proposals against other competing Government priorities.

Tax, financial and workplace relations

Working with Treasury and DEEWR, we advised the Prime Minister on a range of taxation, financial and workplace relations policy issues. This included advice to support implementation of the Government’s response to the Fair Work Act Review, reforms to the corporate bond market and various taxation and superannuation matters considered in the 2013–14 Budget.

We also analysed developments in domestic and international financial markets.

National Panel for Economic Reform

We supported the establishment of the National Panel for Economic Reform (NPER), including drafting terms of reference and establishing processes for the NPER’s meetings, secretariat support, policy development and coordination for two meetings of the NPER. We also prepared for a third meeting that was to be held in early July 2013, but was postponed.

At its meetings the NPER considered the skills and education system, and innovative and productive workplaces.

Commonwealth-State relations

The Prime Minister is the Chair of COAG and the Secretary of PM&C is the Chair of the Senior Officials Meeting. We provided secretariat support to three meetings of the COAG, one meeting of the BAF and 11 Senior Officials meetings.

We also chaired ten meetings of a multi-jurisdictional working group considering expiring NPAs and ways to streamline the development of new agreements.

We assisted the development of significant IGAs, including the National Education Reform Agreement and nine implementation plans under the NPA on Stronger Futures in the Northern Territory.

In addition, we coordinated COAG responses to ten CRC reports, and participated in the Steering Committee for the Review of Government Services Provision.

COAG Reform Council

The CRC was established by COAG to assist it to drive its reform agenda. Independent of individual governments, the CRC reports directly to COAG on reforms of national significance that require cooperative action by Australian governments.

During 2012–13 the CRC presented 11 reports to COAG, including reports on the six National Agreements, four reports on NPAs with reward payments and an overall report on progress with the reform agenda.

In addition to the CRC’s central role in reporting to governments, it also gives priority to engaging relevant stakeholders and the broader community in the process of accountability and performance reporting on the national reform agenda. To assist with this, the CRC has sought independent reviews of its National Agreement reports for plain English and readability – with all reports scoring in the ‘very good’ range or above. The CRC complements this work with active public engagement through the media and social media, as well as regular keynote addresses to stakeholder groups and events.

Strategy and Delivery Division

The Strategy and Delivery Division develops strategic policy advice for the Government, identifies long-term strategic issues and undertakes projects on complex public policy challenges in collaboration with divisions within PM&C and other Australian Government agencies.

Australia in the Asian Century (White Paper) Implementation Taskforce

Following the commissioning of the Australia in the Asian Century White Paper (the White Paper) in 2011 and the subsequent formation of the Australia in the Asian Century Taskforce, the White Paper was completed and launched on 28 October 2012. As the first step in developing Australia’s long term policy of engagement with Asia, the White Paper sets out the strategic blueprint that Australia will use to build its engagement and take advantage of growing opportunities in Asia.

In 2012–13 we established and supported the governance arrangements to oversee implementation of the White Paper, working with a wide range of agencies. To support the implementation of the White Paper we helped develop an Australian Public Service (APS) Asian Century Capability Strategy and conducted analysis on Health and Aged Care opportunities in Asia and Regional Value Chains.

Working across the APS

In 2012–13 we worked to establish a Royal Commission into Institutional Responses to Child Sexual Abuse within tight timeframes, drawing on expertise from across the APS. We played a pivotal role in convening the right people at short notice, and leading the development of practical advice to the Government.

We also made significant contributions to long-term strategic issues, such as responding to the recommendations of the Review of Funding for Schooling, developing an update to the National Digital Economy Strategy, working on refugee status determination and developing the Government’s first National Security Strategy. These projects involved research and analysis, conceptual thinking and significant stakeholder engagement to develop solid theoretical frameworks and concrete actions.

Environment scanning

During the year, we continued to strengthen and diversify our environment scanning capacity to better anticipate long-term trends and opportunities facing the Government. We contributed to the Australasian Joint Agencies Scanning Network, and facilitated internal discussions around emerging issues to inform the Government’s policy thinking. We also convened regular meetings of a Strategic Policy Network for the APS, and hosted regular guest speakers for the Department.

We continued to build good stakeholder relationships with other agencies, the research sector, and industry, including through a number of secondment programs.