Essentially, Bernard is an administrative assistant, overseeing the mechanisms to carry out Hacker's personal wishes, whether it is drafting speeches, putting together reports, or arranging meetings. He would oversee clerical staff who would do the actual work, which you don't generally see because it would probably be too costly. He would be part of Hacker's inner circle, privy to confidences that other staff wouldn't. However, Humphrey is head of the Civil Service, with power over promotions and pay increases. As such, he has a lot of influence over Bernard, though Bernard can counteract some of that, via his direct conduit to the Prime Minister.
In the structure of the show, Bernard is essentially there to ask questions for the audience, and to occassionally throw a dramatic wrench in Humphrey's schemes, by providing vital info to Hacker. He also gets to deliver many of the best punchlines. He's kind of the balance between Hacker and Humphrey.
"Fortunately, Ah keep mah feathers numbered for just such an emergency!"
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