1. © CT Management Group Pty Ltd 2014 ™ ™

2. ™™  To support the community and to continue to provide services the Council must remain sustainable  Future financial performance is an indicator of sustainability  Solutions are not always financial

3. © CT Management Group Pty Ltd 2014 ™™ Basic Needs Intermediate Needs Wants Financially Capable Financially Challenged Financially Secure Roads, Garbage, Health Services Infant Welfare Services, Home Help, Preschool, Parks & Gardens Regional Aquatic Centres, Community Centres, Performing Arts Centres Where does your Council sit now? Where will it be in 10 years time?

4. © CT Management Group Pty Ltd 2014 ™™  Globalisation  Environment Changes  Changing community and social expectations  Decline of traditional industries – agriculture, food processing, manufacturing  Growth in communications – people want access to information ‘now’  Debt management (national, state & local)  Demographic changes  Smaller Government  Low Carbon Future - Peak oil

5. © CT Management Group Pty Ltd 2014 ™™ Rural  Population decline (22/47 Councils recorded negative pop growth 2009-2012)  Low median household income (35/47 Councils median less than $700/wk)  81% of the Communities registered an increase in disadvantage between 2006 -2011 (as measured by the socio-economic disadvantage index)  Average age of population has increased  Aggregation of landholding operations  Peri-Urban Councils and Regional Cities fair better than rest of the Rural Councils Urban  Population growth (2/32 Councils recorded negative pop growth 2009-2012)  Higher median household income (4/32 Councils median less than $700/wk)  66% of the Communities registered an increase in disadvantage between 2006 -2011 (as measured by the socio-economic disadvantage index)  Average age of population more stable  Increase in population  Growth in properties Two Speed Local Government Sector

6. © CT Management Group Pty Ltd 2014 ™™

7. ™™  Changing community and social expectations  Pressure on Councils to retain their identity and independence  Tighter public sector funding in the future  Community resistance to large rate increases  Transfer of service provision  Most Councils have an unfunded community infrastructure gap over next 20 years  $2.3 billion unfunded community infrastructure gap over next 10 years

8. © CT Management Group Pty Ltd 2014 ™™ Rural  Area of State – 217,000 km^2 (95.6%)  Population – 1,220,000  Pop Density – Min 0.5 h/km^2 – Max 360h/km^2  Road Length – 105,000 km Urban  Area of State – 10,100 km^2 (4.4%)  Population – 4,400,000  Pop Density – Min 61 h/km^2 – Max 4,860h/km^2  Road Length – 24,500 km

9. © CT Management Group Pty Ltd 2014 ™™  Changing community and social expectations  Managing expectations  Priority setting  Aging Workforce  Skill shortages  Vested interests resist change  Staff are struggling to find the time and resources to do their duties

10. © CT Management Group Pty Ltd 2014 ™™

11. ™™  Annual Increase 5.0~5.5%

12. © CT Management Group Pty Ltd 2014 ™™  Annual Increase 3.9~4.5%

13. © CT Management Group Pty Ltd 2014 ™™  Annual Increase ~4.4%  Reduction managed by lowering service standards each year

14. © CT Management Group Pty Ltd 2014 ™™

15. ™™  Annual Increase 4.4~4.6%

16. © CT Management Group Pty Ltd 2014 ™™  Inflation Rate (CPI) – 2.5~2.9%

17. © CT Management Group Pty Ltd 2014 ™™ Objectives  It should be based on an organisation achieving its affordable service level objectives whilst maintaining its financial sustainability* Strategy  It should include a description of the financial strategy that is based on Review  It should be reviewed annually * Long Term Financial Planning – Practice Note 6 (IPWEA/ACELG) - 2012

18. © CT Management Group Pty Ltd 2014 ™™ Sustainability Measures – The importance of a GOOD LTFP  Must manage in a resource constrained environment  Community will not continue to accept large rate increases  Ensure that the financial modelling advice provided is sound

19. © CT Management Group Pty Ltd 2014 ™™

20. ™™  The current way of doing things is no longer sustainable  Costs increasing above resident’s capacity to pay  Service delivery under threat  Asset degrading  Risk of government intervention  Need a new way

21. © CT Management Group Pty Ltd 2014 ™™

22. ™™ Council Services Customers/Residents/Community External Focused Services Asset Support Services Internal Services

23. © CT Management Group Pty Ltd 2014 ™™ Service Planning (Effectiveness)  Strategic integrated planning  Linked to other levels of government  Customer/community focused  Allocate available resources to highest need  Comparative choice  Improve service outcomes  Improve customer satisfaction  Transparency and accountability Procurement (Efficiency)

24. © CT Management Group Pty Ltd 2014 ™™ Target efficiency gains of over 30% Efficiency considerations  Build systems that are customer and service centric  Adaptive and responsive  Integrated systems linked to other levels of government  Joined up Government  Common systems and processes across Councils  Shared Services  Regional Hubs  Shared staff  Contracts  Use of advanced technology  Cloud computing (software as a service)  Bureau Services  Common data sets  Common systems and processes across Councils

25. © CT Management Group Pty Ltd 2014 ™™  Fund renewal demand  New and Upgrades to support changes in service delivery  Account for all life cycle costs  Decisions based on need within financial capacity

26. © CT Management Group Pty Ltd 2014 ™™  Customer focused  Adaptive  Flexible  Responsive  Robust  Integrity Management & Financial Systems of the future must be:

27. © CT Management Group Pty Ltd 2014 ™ ™ Presenter Ian Mann CT Management Group ianm@ctman.com.au 0429 941 435