Lloyd is reported as commenting that APS middle managers whose ranks have been thinned by cuts need to do more and have had too much of their responsibility shifted to their bosses.
He said a more risk-averse bureaucracy existed than it did a decade ago, which may have led to the responsibility shifting.
"We are concerned too much of the work has drifted up," Mr Lloyd said. "We have to make sure control and decision making doesn't constantly drift up."
The need for cultural change comes at a difficult time for middle managers whose jobs have been cut more than any other classifications. EL1s, the most severely hit, have made up as much as half the voluntary redundancies at some large Commonwealth employers.
One audience member at the speech at the National Portrait Gallery suggested to Mr Lloyd that public servants were probably risk averse because of the penalties if they made an error of judgment.
Mr Lloyd said this could be because of a large number of watchdogs and "very pernicious" freedom of information laws .
FOI laws allow members of the public to request documents that can show decision-making processes and, in doing so, show where mistakes may have been made. Some within the public service see them as too onerous.
"[FOI laws] have gone a bit further than what they were intended to," he said.A less self-interested response, based on the Objects provisions in the statute and appeals regarding decision-making, would be that APS administration of the Act has not gone far enough.