New ANZSOG evidence review: The Governance and Operation of Smaller Statutory Agencies

Small statutory agencies (SSAs) perform a range of specialised roles in jurisdictions across Australia and Aotearoa New Zealand, and a new ANZSOG research model project aims to produce best practice guidelines for this increasingly important aspect of governance.  

ANZSOG has partnered with the public sector commissions of Queensland and Western Australia to commission the project, which is being undertaken by the University of Western Australia’s Public Policy Institute. The first output – a review of the literature on the governance and operations of SSAs – has now been published through ANZSOG’s Research Insights series. The review examines current literature on the topic and reveals gaps which will provide future directions for this research project and the field more broadly. 

The paper reviews some relevant scholarly and grey literature and finds that while there has been significant past consideration of governance issues in general, there have been fewer studies aimed at the interaction of these issues with the size of agencies, and that the literature has not directly addressed the key questions of how small statutory agencies ought to be constituted. 

The literature does discuss how to define and identify small statutory agencies, noting that there is a range of ways to define smallness, and different understandings of the purposes for which small statutory agencies might be established. Secondly, it also suggests a set of challenges that small statutory agencies face, including risk governance and flexibility in governance frameworks, the interaction of these risks with agency size (in terms of staffing and other resources), recruitment and retention of staff, and accountability to the government and parliament.  

The review looks at questions including: 

• How is the mandate of smaller statutory agencies refined and managed in-practice over the time of their operation? 
• What are the particular challenges in the operation of smaller statutory agencies regarding ongoing stewardship in an area? 
• What are the comparative practices in the connection between smaller statutory agencies and the broader public service on an operational level, for example, in terms of workforce management, corporate service support etc? 
• The review finds that the establishment of any statutory agency should pass a threshold public interest test that accounts for the risks entailed by this approach, as well as the public benefits. 

There are many risks that governments can mitigate by bringing SSAs closer to the rest of the machinery of the government. For example, duplication of efforts or gaps in service provision can be avoided while enhancing collaboration and coordination between different parts of the government. Information and expertise can be shared to carry out their functions effectively. SSAs can also be insulated and protected from political interference by bringing them closer to the rest of the machinery of government. 

This review will shape the direction of this project, which will produce best practice guidance on when it is appropriate to create an SSA, what risks need to be addressed, and what the governance framework should look like. The guidance should balance the risks to efficient and effective operations with the cost of governance in time and money. 

The aim is to provide practitioners throughout Australia and Aotearoa New Zealand with the tools to establish, operate, and govern small statutory agencies by drawing on academic research and experience from around the world.  

The full text of The Governance and Operation of Smaller Statutory Agencies is available here as a pdf or as a word document.