Understanding root causes of what bureaucracies do to people

Serene Teffaha’s stunning post raises many fundamental issues central to the workings of organisations and government and to the quality of their employees’ personal and professional lives.  These issues are not just important to Serene and to all the other frightened, withdrawn, sometimes brutalised colleagues at the ATO, but are important to citizens and the national interest because how employees experience an organisation's culture and operations is how citizens will experience the organisation in their transactions with it.  (The ATO acknowledged and embraced the logic of this mirroring effect earlier, so one would anticipate it would be concerned to work on and fix its culture that has had such a devastating effect as is described below.)

Serene’s story describes, better than anything I’ve ever read, the devastating impacts on her (and her colleagues) - personally and professionally - of leaders’ behaviours and of the culture that shapes their behaviour.

She makes me ask: – (i) Why do people in a government organisation like the ATO behave like this?  (ii) What is to be done to ensure they don’t behave and act similarly in future?

(i)                 I believe the many people who dealt with Serene in ways that caused her so much pain and suffering over a period are not bad people.  Many probably lack the emotional and social intelligence, maturity, awareness, courage, skills and experience to apply them at work and the people-management/ leadership training and experience required to manage a diverse group of people effectively. 

An equally important cause and shaper of their behaviours and actions is the ATO’s culture.

Dr Peter Rennie’s work (at Leadership Australia) suggests that the ATO culture is substantially shaped, as is the culture of all bureaucracies where power, organisational and interpersonal relationships are predominantly hierarchical, by the hierarchical nature of those relationships.

Rennie’s insight is that leaders in such a hierarchical culture think and behave in ways that would inevitably give rise to the dysfunctionalities and devastating experiences described by Serene.

On top of that, I believe there are a number of dynamics at work that make the management/leadership behaviours, actions and culture of a revenue-gathering organisation, such as the ATO, significantly more dysfunctional and devastating for people with whom it (the organisation) is uncomfortable, than of other (non-revenue-gathering) bureaucracies.  (These insights and dynamics are elaborated on in various articles, books and papers, which are available on request.)

The logic of these insights and dynamics predicts that the ATO will treat people like Serene was treated, as long as it remains an organisation that is operating hierarchically.  So, largely due to Rennie’s work and psycho-dynamic insights about the shapers of a revenue-gatherer's culture, we can now understand the root causes of why the ATO behaves as it does, and as extremely as it does; and why it performs – or rather fails to perform - as it traditionally does.

(ii)               The solution to all the dysfunctionalities and problems associated with hierarchical organisational relationships is also provided by Dr Peter Rennie.  He suggests that if the hierarchical relationships are replaced by collaborative, team-based thinking and practice, the dysfunctionalities and problems will be fixed.  From my years in creating and leading high performing teams, on the one hand, and experiencing the endemic closed-mindedness and dysfunctionalities of the ATO, on the other, I know he is right. 

Which prompts one more question:  What will each of us do now to help fix the problem (the confronting challenge) that hierarchical organisations will inevitably behave like the ATO behaved towards Serene?

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Comment by gary kurzer on January 21, 2013 at 9:24am


if you feel that there is the option of speaking face to face with Chris Jordan, I'm ready.

It has become more than clear to me that the reason the ATO acts so boldly is that it feels it is untouchable, particularly when the politicians deem the taxpayer (or PS Staff who report wrong doing) as as guilty 100% of the time! This is despite unequivocal proof to the contrary, but there is no appropriate forum for re-dress.

The ATO are not, ultimately, "untouchable" and time will see changes.

Comment by gary kurzer on January 16, 2013 at 2:33pm


I am resisting lodging a long post, but certain observations might be fruitful.

1.  Why do people behave as they do?

It is unlikely to be a singular reasons, but power, greed, pathologies, issues from their past (youth, childhood), are all contributory. For example, dealing with sociopaths (which I am doing presently) is very challenging. Behaviour transgresses “normalcy” and the agenda becomes something significantly different to the prima facie matters.

In the case of the auditors who handled my case, I suspect that a pivotal point was when the chief auditor (his originating nationality was from an overseas country) saw my unit (I am an architect, so it was of a high standard, and recall it was for investment) I’m sure he perceived me as a silvertail, yet the truth of my “wealth” was quite the opposite. It may have lead him to think: “well, he is a high flyer, so I am justified in twisting the facts so he pays significant tax.”

Alternatively, he may have been trying to “prove” himself: I saw many instances of this when he was in front of his superior. It was patently clear to me that he was out of his depth on matters of property.

2.  To raise revenue

This is a hydra-headed issue.

Firstly, perhaps a perverse type of ATO altruism that the ATO’s role is to bring in money, and that therefore diversions from a strict legal chain is permissible in pursuing this objective. (It isn’t.) "Tick and flick .. 20% approved objections, 80% rejected, regardless of merit?"

Secondly, almost no government body looks at “cradle to grave” issues.

Such as the energy efficient light bulb mandated by government: the costs of production and disposal are much greater than for those of a conventional bulb, yet the government took an isolated slice (only when you run the bulb) to enforce a “cost benefit” that is probably non-existent.

Regarding tax, can it be said that having ATO staff tied up for 5 years (and counting), the engagement of external legal staff at $128,000, the “Mediation” process of some $42,000 plus the moneys paid to accountants, lawyers, et al, was worth it for $8,400?

The APS personnel numbers engaged in “tax” is huge, to say nothing of the extraordinary, and ludicrous system of governance that backs “tax” (legal drafting, court cases, governance, motherhood clauses, et al). If you added all of this up, it may be that half of the tax collected was wasted in governance. I’m a long way from a “KISS” supporter for many complex matters, but regarding tax, I can see considerable merit in a very simplified (perhaps a modified “flat tax”) because until you do a “cradle to grave” analysis, most of the premises of net revenue gains are deeply flawed.

By default, I have read thousands of pages of "tax law," legal cases, etc.

Many are just plain contradictory, and others are so ludicrous that it pains me to understand why 50,000 words could not be replaced by a simple, unambiguous clause. Some are such deep obfuscations that even the most senior tax lawyer would be dumbfounded. How is that a fair system which every taxpayer is "duty bound" to understand? And when it goes wrong, who gets paid? Yes, the lawyers, again.

Thirdly; when the ATO bankrupts people like me, and small businesses, you delete tax paying, productive members of society, and turn them into welfare recipients (“cradle-to-grave” benefit?) as well as adding to the high social cost of mental health, physical health, family breakdowns, the suffering of dependents, et al.

For example, an excellent statistic (admittedly US sourced) was that for every dollar spent in pre-school education, the state saved $22 in later welfare, incarceration, etc.

The apparent ATO maxim to “raise revenue at any cost” is highly unlikely to even be fiscally responsible if a complete timeline, and the costs of collateral damage, are taken into account.

Lastly, and most sinister, is the comfortable relationship between the ATO and private legal firms.

I am told by the ATO that this singular line:

“to advise and assist in the claim generally” 

was the entire legal engagement contract with Minter Ellison (paid $128,000) for “helping” the ATO. It was part of a General Services contract of some $3.8m awarded under tender to ME for Legal Services to the ATO for 2011 - 2013. This had nothing to do with equity or justice, it was simply a way for the ATO to:

- deny their (ultimately) undeniable mistakes

- to ensure that private colleagues were well paid (how much work does $128,000 buy?)

- to deny any compensation ( "you are entitled to $0.")

- and latterly, to ensure (via an unconscionable "Deed") that I was silenced in revealing the gross ATO

  errors, and to indemnify all ATO staff, including future staff, for this, or other errors.

I cannot conclude anything other than there is a most disturbing relationship between “the big end of town” and the ATO, and where the small taxpayer or business is totally powerless against the collusion of the legal firms and the ATO in denying justice.

Comment by gary kurzer on January 16, 2013 at 1:35pm


contacted to date (others I have forgotten):

Joe Hockey: (2 x ) no response

Tony Abbott: (recent, no response)

Penny Wong: (multiple, no response)

Gary Gray: (no real response other than repeating that the ATO says it has been fair)

David Bradbury (no real response)

Tony Windsor: (no response)

Nick Xenophon: (no response to the matter:  "you are not in my electorate")

Nick Sherry: ("here is the name of the ATO bankruptcy officer who can help you.")

Wayne Swan: (no response)

Maxine McHugh: ("good luck, not my issue")

Mathias Corman: (recent, no response)

Julia Gillard:  (no response)

Local Member, Malcolm Turnbull: (3 years, no interview request granted, wrote a letter of support to Bradbury)

Sen Matt Thistlethwaite: (2 hour meeting, no outcome)

Sen Foreshaw: ("speak to your local member")

Sen Faulkner: (no response)

Lindsay Tanner: (no response)

Peter Garrett: ("don't talk to me about this matter")

Rob Oakeshot:  (no response)

Barnaby Joyce: ("keep in touch when you hear something")

Andrew McLoughlin: (Deputy IGOT) ("can't assist on a personal level")

The Taxpayer's Association

ACT Law Society

Commonwealth Ombudsman

Andrew Wilkie:  (no response)

Sen Arbib:  (no response)

Direct appeal to the Department of Finance (no claim paid)

Appeals to the SMH for a story (no response)

Appeals to the Fin. Review for a story  (no response)

7.30 Report :http://www.abc.net.au/7.30/content/2012/s3623899.htm (story aired, but edited)

Appeals to Radio stations for an interview (one 3 minute segment done on 99.3FM)

Letters to the Editor (many publications contacted, none printed)


Comment by gary kurzer on January 16, 2013 at 1:05pm


I'd love to have a fair hearing. The Ombudsman has been kept informed for some four years, but avoids any engagement on the present issues. I spent two hours with the Deputy IGOT, who stated to me that "he wouldn't start a company" in Australia because of the ATO and government red tape. He knows what goes on, and knows that the ATO  (or the government) have no duty whatsoever to acknowledge his recommendations (ditto the Ombudsman).

This is the IGOT advising against running a business in Australia!

The CDDA Scheme is meant to address these issues: the ATO profoundly abused the Scheme (and paid a private legal firm $128,000 to do so).

I would appreciate an audience with Chris Jordan (almost as much as I would appreciate a luxury holiday, both are very unlikely occurrences.) 

No government member: Labor, Liberal, or Independent, will engage with me (years of letters and emails).

The singular "nature" of response (if rarely received) is:

- speak to the ATO, not me

- speak to the other party

- we unilaterally back the ATO.

Recently I sent a letter to the woman who was chairing the senate meeting with Michael D'Ascenzio.

No response.

All suggestions gratefully received. After 5+ years, I'd like to have my life back; very hard when you have been made destitute by the ATO and they have spend massive amounts of public funds to ensure that they have covered their gross errors by paying their mates in the big legal firms.

http://www.landers.com.au/Portals/0/Publication PDFs/Your case matt....


Comment by Graham Gourlay on January 16, 2013 at 12:50pm

Gary, I wonder if you are inclined to share your experience and puzzlement with the new Commissioner of Taxation - and perhaps also with the Inspector-General of Taxation, the Government and Opposition Treasurers or Assistant Treasurers; Senators who sit on the Senate Estimates Committee, etc?  There are lots of potentially fruitful arms to governance of the ATO that provide avenues for seeking understanding about things that puzzle us and for contributing to the momentum for culture and organisational change. Regards 

Comment by gary kurzer on January 16, 2013 at 12:13pm

And, apart form the massiver personal and financial costs regarding Public Servant's issues, the ATO does the same to the public, and do so via highly questionable engagement practices with large corporations (in my case, Minter Ellison). The entrenched behaviour of the ATO remains unchallenged by government, who, in fact supports their actions regardless of both the human cost, and the immense financial cost to the community.

Say, $100m+ last year.

I don't get it, apart from personal aggrandisement and financial gain to mates. Am I being too cynical?

Comment by gary kurzer on January 16, 2013 at 12:03pm

This story is very prescient.


Disregarding the human cost .... and why should we care about people anyway  :-(   ... there's MONEY involved!

Isn't that the (sole) language of government?

Comment by steve davies on May 15, 2012 at 8:40am

Very thoughtful and full of insight Graham. I could not agree more with your call to action. What are we going to do to fix the problem.

A key concrete action to take is to make the oversight of complex issues such as this social and public 24/7. This is precisely what I am working on.

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