The Second Albanese Ministry and its 2025 Administrative Arrangements Order show a government shifting decisively from reform design to delivery architecture. With stable super-departments and a growing cadre of assistant ministers, the machinery appears fit for purpose.
Yet there is a troubling quietness in key domains – especially research, innovation, and productivity. Reform energy has not translated into new institutional ambition.
The Machinery of Government is built to deliver, but it risks having too little substance to deliver upon. With the foundations now in place, what remains is political will and the imagination to use this machinery to tackle the harder reforms that lie ahead.
The swearing-in of the new ministry, accompanied by a revised Administrative Arrangements Order (AAO), offers a window into how the Albanese government has recalibrated its approach to power, policy, and delivery.
The Parliamentary caucus decides the number of ministers, and the Prime Minister decides on ministerial roles and responsibilities which the Governor General confirms in accordance with the Constitution.
The Prime Minister also allocates ministers to portfolios, which the AAO refers to as ‘departments of state’. There are 16 departments (effectively 15 as the Department of Veterans’ Affairs operates within the Defence portfolio. Departments generally have several ministers.
The official listing of ministers aligning with their portfolios reflects the order of precedence set by the Prime Minister. While not explicitly ranked by priority, this sequence typically signals the relative importance of portfolios within the government’s strategic agenda.
In contrast to the 2022 ministry and AAO, primarily instruments of transition and institutional repair, the 2025 configuration signals a shift to the consolidation and execution of reform. The government has moved decisively from policy commitments to delivery architecture.
The number of cabinet ministers has remained steady at 30, and the number of assistant ministers has increased from 16 in 2022 to 19 in 2025. This expansion reflects a deliberate effort to support delivery in increasingly complex and cross-cutting domains such as cybersecurity, emergency management, digital infrastructure, and regional and multicultural affairs.
The overall structure of the ministry, the ordering of seniority, and the redesigned alignment of departmental functions reveal how the Albanese Government now sees its role: not merely to govern, but to build the systems, capabilities, and institutional clarity required to deliver on its national agenda.
Ministerial seniority and Portfolio Consolidation
The composition of the second Albanese ministry appears largely stable at first glance. However, the order of ministerial seniority and changes in portfolio groupings reveal deeper strategic shifts in political emphasis and administrative focus.
The top five positions – Prime Minister Anthony Albanese, Deputy Prime Minister and Defence minister Richard Marles, Finance minister Katy Gallagher, Treasurer Jim Chalmers, and Foreign Minister Penny Wong – remain unchanged from 2022. This continuity signals trust and central coordination. Yet beneath that surface, the rearrangement of responsibilities and the sequence in which ministers are listed suggest a rebalancing of strategic focus areas.
A very notable shift is the dramatic rise in the priority of the Home Affairs portfolio, which moved from 15th place in 2022 to 6th in 2025. It now includes dedicated ministers for Cyber Security, Multicultural Affairs, and Emergency Management, along with four assistant roles.
This signals a decisive elevation of domestic security, community resilience, and digital infrastructure protection in the government’s strategic hierarchy – aligned with global concerns over cyber threats, social cohesion, and climate-induced emergencies.
The Department of Finance, while holding its 5th rank, has substantially deepened its functional power. What was once a narrow expenditure control agency – originally carved out of Treasury in the mid-1970s to alleviate the burden on then-Treasurer Phillip Lynch – has matured into a strategic hub for capability, reform, and coordination.
Under Senator Gallagher, Finance now controls not only the budget but also digital identity, ICT procurement, government services, and public sector transformation. This positions Finance as the operational centre of government, potentially overshadowing both PM&C and Treasury in its ability to direct system-wide delivery.
Several portfolio shifts reflect near-term political imperatives:
- The expansion of the Treasury portfolio to include ministers for Housing, Homelessness, Cities, and Small Business points to a focus on cost-of-living and urban liveability – issues of acute electoral sensitivity.
- The Health and Ageing Portfolio has moved up from 8th to 7th and includes three ministers and four assistant ministers, indicating the government’s intent to consolidate trust following scrutiny of aged care, NDIS administration, and rural health systems.
Strategic retreat from innovation
In contrast, the Industry, Science and Resources portfolio, despite housing the Future Made in Australia agenda, has slipped to the bottom of the ministerial order – falling from 13th in 2022 to 15th in 2025. This quiet demotion suggests a strategic retreat from front-footed innovation system reform.
However, the portfolio contains three ministerial roles (up from two) and two assistant ministers (up from one) including an assistant minister for Science, Technology and the Digital Economy.
There is a major challenge for the ministers to raise the prominence of the Portfolio in driving political attention in this second term.
The Education portfolio, though crucial for long-term productivity, has also seen a downgrading in symbolic status – from 7th to 11th place. Despite the ongoing implementation of the Universities Accord and a stronger research infrastructure mandate, education appears to have been structurally subordinated to more politically immediate priorities such as housing, health, and defence. There are however, three assistant ministers covering for Early Childhood Education, Youth and International Education.
Employment and Workplace Relations, after delivering major reforms in the first term, has fallen down the order from 6th to 10th—suggesting its political salience has waned now that key legislative milestones have been reached.
Administrative design as implementation strategy
The second Albanese ministry and its Administrative Arrangements Order reveal a government that understands implementation not as a postscript to policy but as a core governing dimension. It is a model that:
- Consolidates strategic leadership in high-trust Ministers
- Clarifies delivery mandates within super-departments
- Embeds equity in institutional structures, not slogans
- Treats national resilience as a shared responsibility across portfolios
- Builds the administrative foundations for long-term system reform
The model is no longer a reform agenda seeking definition. It is a machinery of government calibrated to deliver results, and to be judged by them.
This very calibration may, however, expose what is missing. The structural arrangements suggest managerial maintenance rather than systemic transformation in key domains such as research and innovation, industrial policy, and productivity growth.
These functions remain dispersed across Portfolios, coordination mechanisms are unclear, and few new reform initiatives have been signaled. Andrew Leigh as an assistant minister in the Treasury Portfolio has had his role expanded from Competition, Charities and Treasury to include Productivity.
While established institutions like the Australian Research Council (ARC) and new ones, including the National Reconstruction Fund and the Net Zero Economy Authority have been created their connective tissue – shared strategy, funding alignment, and governance clarity – remains underdeveloped.
The machinery may be generally stable but the reform ambition seems to have plateaued. It raises the possibility that the government, while structurally prepared to deliver, may be institutionally avoiding the deeper redesigns that innovation, industrial strategy, and long-term competitiveness still demand.
The AAO may not be a sign of traction for stakeholders in these domains – it may be a signal of complacency.
In that light, the deeper question is not whether the government can implement what it has planned, but whether it has planned enough of what really matters for the nation’s future industrial, innovative and productive capability.
Dr John Howard is the Executive Director of the Acton Institute for Research in Policy and Innovation and a Visiting Professor at the University of Technology Sydney. He can be contacted at john@actoninstitute.au.
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