Asset Management in Integrated Planning and Reporting for Local Governments Troy Daniels, Project Manager Department of Local Government and Communities

Drivers of Local Government Reform in Western Australia LGAB Ensuring the Future Sustainability of Communities Report recommendations (2006) (2008) WALGA Systemic Sustainability Study LGPMC Nationally Consistent Frameworks on Local Government Sustainability (2009) (2010) Reform Steering Committee Report

Drivers of Local Government Reform in Western Australia Estimated local government asset renewal gap = $110 million per annum (Allan, 2012) Estimated local government infrastructure renewal backlog = $1.75 billion (Allan, 2012) Pressure on local government to increase fees, charges, rates and borrowing

Tackling Asset Management Reform Integrated Planning and Reporting (IPR) Framework developed in 2010 Changes to Plan for the Future regulations gazetted August 2011 Responded to capacity challenges in the sector Integrated approach to planning based on meaningful engagement with the community on significant choices De-emphasized the annual budget cycle Recognised diversity of the sector Enhanced opportunities to engage with other agencies

Asset Management Framework and Guidelines Aligns with interstate and international frameworks and asset management practice. Developed with the sector through Asset Management Working Group. Aims to enhance the sustainable management of local government assets by encouraging a whole of life and whole of organisation approach to asset management.

Implementing Integrated Planning Frameworks Guidelines Toolkits Regulations Advisory Standard Website & e-bulletin Workshops Master classes

The Local Government Sector Responds

Asset Management Challenges To Date GENERAL GAPS IPR alignment Cross-organisational responsibility Performance measurement AM Strategy AM Policy GENERAL GAPS IPR alignment Cross-organisational responsibility Performance measurement AM Strategy AM Policy Internal Challenges

Asset Management Challenges To Date Challenge What local governments may require help with…. Data management Methods to maintain data appropriately. Methodologies for carrying out consistent asset condition surveys and defect identification. Processes for quantifying maintenance expenditure into reactive and planned maintenance. Processes for and assistance in horizon planning; capital works justification & prioritisation for implementing investments in new assets. Condition and useful life Collection and management of condition data. Robust processes for condition ratings and modelling. Service levels Determining asset performance targets and current performance. Determining the current utilisation levels of assets and remaining capacity. O&M, renewal and replacement strategies Developing formalised process for O&M. Documenting an O&M strategy. Documenting the renewal and replacement strategy. Documenting the capital investment strategy.

The Future of Asset Management in WA AM Plans Completed. Implementation of AM Improvement Strategies commences. Fair Value accounting adopted. Condition and useful life data collected and complete. AM Plans Reviewed and renewed where appropriate. Capital investment strategies and decision making criteria set. Monitoring of AM practice commences (through NAF). AM Improvement Strategies implemented. Data Management improves. Renewal and replacement strategies in place. Service Levels agreed with community as part of SCP review and renewal. LGs have confidence in setting and assessing achievement against asset performance targets. LG AM Plans inform State funding decisions. Renewal funding strategies established through LTFPs to address funding gaps. AM practice consistently improving – –

The Future of Asset Management in WA TimeframeDLGC Activities Short Term (12-18 months) Advice and support Review of IPR frameworks and guidelines Review and renewal of IPR Advisory Standard Update of the Performance Management Framework Asset management support for country local governments Support for National Assessment Framework Medium Term (2-4 years) Training for elected members Asset management support for country local governments Support for National Assessment Framework Engagement with State Agencies Long Term (5 years +) Ongoing advice and support Engagement with State Agencies

Thank you Department of Local Government and Communities Gordon Stephenson House 140 William Street PERTH WA 6000 GPO Box R1250 PERTH WA 6844 Telephone: (08) Integrated Planning enquiries: E