The surprise appointment of Kelly O'Dwyer to replace Michaelia Cash representing public servants and women in the Turnbull ministry is set to see a significant reorganisation among federal departments, coming as ACT senator Zed Seselja takes on the role of assistant minister for science, jobs and innovation.

The Higgins MP - a former staffer to Howard government treasurer Peter Costello - advocated in 2013 for "devolving power" away from Canberra-based departments and agencies, suggesting big business believes the public service does not understand the impact of policy or Australia's economic realities.

"Business complains that the public service "doesn't get it" -whether it's what impact a policy change will have in practice, or what's going on in the "real economy"," Ms O'Dwyer wrote in an Australian Financial Review opinion piece coinciding with Canberra centenary celebrations.

"Ditto, not-for-profits. And for voters on the home front - after all, Canberra's definition of a traffic jam is two cars within five metres of one another on Capital Circle.

"With its commitment to Australia's future and despite undoubted talent within its ranks, the public service also gets frustrated at not understanding why its perfect theoretical solution won't fly."

The change offers the chance for a reset with the public service, in contrast to the hardline approach brought by former ministers Senator Cash and Eric Abetz, the bitter response to more than 15,000 job cuts and the government's tough new workplace policy.

Ms O'Dwyer, minister for revenue and financial services, wrote in 2013 the size of the federal government workforce should be reduced to limit centralised decision making.

"Since 2007, the number of federal public servants has risen by about 20,000, yet many decisions would be better left to local communities and agencies on the ground, rather than made in Canberra.

"Devolving power removes obvious information costs between Canberra and the rest of Australia and delivers greater responsiveness to local needs."

She said the Coalition shouldn't put "all of our eggs in the smaller government basket", arguing for six-month to three-year exchanges between departments and private firms to promote new insights and "more commercial" advice to government.

Community and Public Sector Union national secretary Nadine Flood called on Ms O'Dwyer to deliver a new approach.

"This is an opportunity for the Turnbull government to change tack and abandon its destructive and counter-productive approach to the Commonwealth public sector," she said.

"Kelly O'Dwyer should turn away from the ideologically driven war on public sector workers that's been waged by Michaelia Cash and Eric Abetz before her and instead adopt a pragmatic and constructive approach to dealing with the public service."

"I will be seeking to meet with Kelly O'Dwyer at the first available opportunity to discuss the deep challenges facing the public service and the people working with it to deliver services and public policy."

Ms O'Dwyer said she was looking forward to getting briefed on issues within the public service, and would have more to say afterwards.

Hume MP Angus Taylor moves from assistant minister for cities and digital transformation to the new Home Affairs mega portfolio, in the new role of Minister for Law Enforcement and Cybersecurity.

Michael Keenan will take Mr Taylor's former role overseeing the Digital Transformation Agency as well as taking over from Alan Tudge as Human Services Minister.