1. MAIN ROADS WA & LOCAL GOVERNMENT COMMON NETWORKS COMMON PROBLEMS COMMON SOLUTIONS? 2015 NATIONAL LOCAL GOVERNMENT INFRASTRUCTURE AND ASSET MANAGEMENT CONFERENCE Menno Henneveld Consulting 14 th May, 2015 Melbourne, VICTORIA

2. MAIN ROADS WA & LOCAL GOVERNMENT 2015 NATIONAL LOCAL GOVERNMENT INFRASTRUCTURE & ASSET MANAGEMENT CONFERENCE Menno Henneveld Consulting The Importance of Roads Managing WA’s Road Networks Major Issues and Challenges of Roads Road Funding in WA State Funds to Local Government Road Asset Management Achieving Value-for-Money Integration and Collaboration…the common solution OUTLINE OF PRESENTATION

3. MAIN ROADS WA & LOCAL GOVERNMENT 2015 NATIONAL LOCAL GOVERNMENT INFRASTRUCTURE & ASSET MANAGEMENT CONFERENCE Menno Henneveld Consulting A century of travel Taking roads for granted The importance of roads in Western Australia Roads: Local Government’s largest assets THE IMPORTANCE OF ROADS

4. MAIN ROADS WA & LOCAL GOVERNMENT 2015 NATIONAL LOCAL GOVERNMENT INFRASTRUCTURE & ASSET MANAGEMENT CONFERENCE Menno Henneveld Consulting A CENTURY OF TRAVEL

5. MAIN ROADS WA & LOCAL GOVERNMENT 2015 NATIONAL LOCAL GOVERNMENT INFRASTRUCTURE & ASSET MANAGEMENT CONFERENCE Menno Henneveld Consulting THE IMPORTANCE OF ROADS TYPHOON HAIYAN PHILLIPINES 2013 NEPAL EARTHQUAKE April 2015

6. MAIN ROADS WA & LOCAL GOVERNMENT 2015 NATIONAL LOCAL GOVERNMENT INFRASTRUCTURE & ASSET MANAGEMENT CONFERENCE Menno Henneveld Consulting THE IMPORTANCE OF ROADS JAPAN EARTHQUAKE MARCH 2011 Joban Expressway

7. MAIN ROADS WA & LOCAL GOVERNMENT 2015 NATIONAL LOCAL GOVERNMENT INFRASTRUCTURE & ASSET MANAGEMENT CONFERENCE Menno Henneveld Consulting BRISBANE FLOODS 2011

8. MAIN ROADS WA & LOCAL GOVERNMENT 2015 NATIONAL LOCAL GOVERNMENT INFRASTRUCTURE & ASSET MANAGEMENT CONFERENCE Menno Henneveld Consulting THE IMPORTANCE OF ROADS WA BUSHFIRES ROLEYSTONE 2010

9. MAIN ROADS WA & LOCAL GOVERNMENT 2015 NATIONAL LOCAL GOVERNMENT INFRASTRUCTURE & ASSET MANAGEMENT CONFERENCE Menno Henneveld Consulting WA’s RESOURCES SECTOR Over-Size Over-Mass Loads

10. MAIN ROADS WA & LOCAL GOVERNMENT 2015 NATIONAL LOCAL GOVERNMENT INFRASTRUCTURE & ASSET MANAGEMENT CONFERENCE Menno Henneveld Consulting AGRICULTURE AND THE WA ROAD NETWORK

11. MAIN ROADS WA & LOCAL GOVERNMENT 2015 NATIONAL LOCAL GOVERNMENT INFRASTRUCTURE & ASSET MANAGEMENT CONFERENCE Menno Henneveld Consulting WA ROADS AND TOURISM

12. MAIN ROADS WA & LOCAL GOVERNMENT 2015 NATIONAL LOCAL GOVERNMENT INFRASTRUCTURE & ASSET MANAGEMENT CONFERENCE Menno Henneveld Consulting ROADS – LOCAL GOVERNMENT’S LARGEST ASSETS

13. MAIN ROADS WA & LOCAL GOVERNMENT 2015 NATIONAL LOCAL GOVERNMENT INFRASTRUCTURE & ASSET MANAGEMENT CONFERENCE Menno Henneveld Consulting WA’S ROAD NETWORKS

14. WA’s ROAD NETWORKS MAIN ROADS WA & LOCAL GOVERNMENT 2015 NATIONAL LOCAL GOVERNMENT INFRASTRUCTURE & ASSET MANAGEMENT CONFERENCE Menno Henneveld Consulting

15. MAIN ROADS WA & LOCAL GOVERNMENT 2015 NATIONAL LOCAL GOVERNMENT INFRASTRUCTURE & ASSET MANAGEMENT CONFERENCE Menno Henneveld Consulting PROFILE OF STATE ROAD NETWORK State Road Network 2.5m population 17,800km 830 Traffic Lights 2068 Bridges Metro Perth 1.6 m population 2552 lane km 793 traffic lights 712 structures

16. MAIN ROADS WA & LOCAL GOVERNMENT 2015 NATIONAL LOCAL GOVERNMENT INFRASTRUCTURE & ASSET MANAGEMENT CONFERENCE Menno Henneveld Consulting LENGTH OF ROADS National Road Network …………….. 4,902km State Highways ……………………… 6,041km Main Roads …………………………... 7,082km Local Roads …………………………131,272km Other (forestry, National Parks) …. 38,000km VALUE OF NETWORK Main Roads WA ……………………… $42.2 billion Local Government ………………….. $13.0 billion PROFILE OF WA ROAD NETWORKS

17. MAIN ROADS WA & LOCAL GOVERNMENT 2015 NATIONAL LOCAL GOVERNMENT INFRASTRUCTURE & ASSET MANAGEMENT CONFERENCE Menno Henneveld Consulting Road funding Road safety and increasing road toll Asset management Traffic management and increasing congestion Population growth and car ownership Sustainability Community expectations Regulatory impacts Use of technology Integration with other forms of transport Growth in Freight Task and HV access ISSUES AND CHALLENGES OF ROADS

18. MAIN ROADS WA & LOCAL GOVERNMENT 2015 NATIONAL LOCAL GOVERNMENT INFRASTRUCTURE & ASSET MANAGEMENT CONFERENCE Menno Henneveld Consulting Governance structure for responsibility of roads Some parts of network in poor state of repair Growth in vehicles and distance travelled No incentives to provide HV access Planned maintenance competes with other demands Ever growing maintenance backlogs Reduced capital and maintenance funding Lack of intermodal transport planning Shortage of information to plan networks FACTORS CONTRIBUTING TO ROADS ISSUES

19. FEDERAL FUNDING OF ROADS IN WA PROGRAMFUNDING ($ million) PERIOD National Projects: On-going New Projects Off network projects Maintenance Total 36.5 1181.0 147.0 698.0 $2452.0 2008/9 – 2013/14 Roads to Recovery238.02008/9 – 2013/14 Black Spot7.82010-2011 Financial Assistance Grants226.02009 - 2010 MAIN ROADS WA & LOCAL GOVERNMENT 2015 NATIONAL LOCAL GOVERNMENT INFRASTRUCTURE & ASSET MANAGEMENT CONFERENCE Menno Henneveld Consulting

20. MAIN ROADS WA & LOCAL GOVERNMENT 2015 NATIONAL LOCAL GOVERNMENT INFRASTRUCTURE & ASSET MANAGEMENT CONFERENCE Menno Henneveld Consulting EXPENDITURE ON ROADS IN WA

21. MAIN ROADS WA & LOCAL GOVERNMENT 2015 NATIONAL LOCAL GOVERNMENT INFRASTRUCTURE & ASSET MANAGEMENT CONFERENCE Menno Henneveld Consulting EXPENDITURE vs REVENUE ON ROADS IN WA

22. MAIN ROADS WA & LOCAL GOVERNMENT 2015 NATIONAL LOCAL GOVERNMENT INFRASTRUCTURE & ASSET MANAGEMENT CONFERENCE Menno Henneveld Consulting MAIN ROADS WA 2013-2014

23. MAIN ROADS WA & LOCAL GOVERNMENT 2015 NATIONAL LOCAL GOVERNMENT INFRASTRUCTURE & ASSET MANAGEMENT CONFERENCE Menno Henneveld Consulting SOURCES OF LOCAL GOVERNMENT ROAD FUNDS

24. MAIN ROADS WA & LOCAL GOVERNMENT 2015 NATIONAL LOCAL GOVERNMENT INFRASTRUCTURE & ASSET MANAGEMENT CONFERENCE Menno Henneveld Consulting MAIN ROADS WA 2013-2014

25. MAIN ROADS WA & LOCAL GOVERNMENT 2015 NATIONAL LOCAL GOVERNMENT INFRASTRUCTURE & ASSET MANAGEMENT CONFERENCE Menno Henneveld Consulting LOCAL GOVERNMENT EXPENDITURE ON ROADS IN WA

26. MAIN ROADS WA & LOCAL GOVERNMENT 2015 NATIONAL LOCAL GOVERNMENT INFRASTRUCTURE & ASSET MANAGEMENT CONFERENCE Menno Henneveld Consulting PRESERVATION NEED AND EXPENDITURE GAP

27. MAIN ROADS WA & LOCAL GOVERNMENT 2015 NATIONAL LOCAL GOVERNMENT INFRASTRUCTURE & ASSET MANAGEMENT CONFERENCE Menno Henneveld Consulting INFRASTRUCTURE REPORT CARD FOR ROADS IN WA Engineers Australia 2010

28. MAIN ROADS WA & LOCAL GOVERNMENT 2015 NATIONAL LOCAL GOVERNMENT INFRASTRUCTURE & ASSET MANAGEMENT CONFERENCE Menno Henneveld Consulting STATE FUNDSTO LOCAL GOVERNMENT IN WA

29. MAIN ROADS WA & LOCAL GOVERNMENT 2015 NATIONAL LOCAL GOVERNMENT INFRASTRUCTURE & ASSET MANAGEMENT CONFERENCE Menno Henneveld Consulting STATE FUNDS TO LOCAL GOVERNMENT MANAGEMENT STRUCTURE

30. MAIN ROADS WA & LOCAL GOVERNMENT 2015 NATIONAL LOCAL GOVERNMENT INFRASTRUCTURE & ASSET MANAGEMENT CONFERENCE Menno Henneveld Consulting Changing approach to Maintenance Contracting Availability of funding to deliver future maintenance at an acceptable level of service Diminishing residual service life of assets Inadequate skilled human resource pool (Attraction and retention) Increased road use shortening asset life Ability to attract viable contractors Retain and/or rebuild regional presence and capability ASSET MANAGEMENT CHALLENGES

31. MAIN ROADS WA & LOCAL GOVERNMENT 2015 NATIONAL LOCAL GOVERNMENT INFRASTRUCTURE & ASSET MANAGEMENT CONFERENCE Menno Henneveld Consulting EVOLUTION IN ROADS ASSET MANAGEMENT Builder and Maintainer Network Manager and Operator Road User Services

32. MAIN ROADS WA & LOCAL GOVERNMENT 2015 NATIONAL LOCAL GOVERNMENT INFRASTRUCTURE & ASSET MANAGEMENT CONFERENCE Menno Henneveld Consulting EVOLUTION OF MAINTENANCE DELIVERY Delivery Method Total Control Select contractors Quality Assurance Day Labour Workforce Term Maintenance Contracts Term Network Contracts Integrated Service Arrangements Delivery Method Little control Outsourcing “Hands off” Delivery Method Total Control Culture of excellence and improvement Partnership 1906 1995 1999 2010

33. MAIN ROADS WA & LOCAL GOVERNMENT 2015 NATIONAL LOCAL GOVERNMENT INFRASTRUCTURE & ASSET MANAGEMENT CONFERENCE Menno Henneveld Consulting Joint management Main Roads and private sector Providing service delivery using an integrated (collaborative) approach Direct cost, open book reimbursement, with a risk/reward regime (portion of profit at risk) Scope of services tailored for each network Each ISA operates with a joint management team and operational staff comprising Main Roads and the Integrated Services Provider (ISP) Procure a range of service providers in a fully integrated manner, akin to ‘in-sourcing’ THE ISA CONCEPT

34. MAIN ROADS WA & LOCAL GOVERNMENT 2015 NATIONAL LOCAL GOVERNMENT INFRASTRUCTURE & ASSET MANAGEMENT CONFERENCE Menno Henneveld Consulting REGIONAL SUSTAINABILITY AND THE ISA’s Collaborative relationships Insourcing private sector partners More than just a maintenance contract Services include: o Road network operations o Operational asset management o Maintenance delivery and capital works to $3m o Technical engineering, project and contract management services

35. MAIN ROADS WA & LOCAL GOVERNMENT 2015 NATIONAL LOCAL GOVERNMENT INFRASTRUCTURE & ASSET MANAGEMENT CONFERENCE Menno Henneveld Consulting MAIN ROADS OBJECTIVES FOR ISA’s Control asset management decisions Achieve best practice in operational asset management and network operations Build capability and capacity Innovation and improvement leading to outstanding performance Value for money Main Roads as an informed purchaser Potential for LG involvement

36. MAIN ROADS WA & LOCAL GOVERNMENT 2015 NATIONAL LOCAL GOVERNMENT INFRASTRUCTURE & ASSET MANAGEMENT CONFERENCE Menno Henneveld Consulting ISA NETWORK COVERAGE Integrated Service Arrangement Integrated Service Provider Kimberley ISADownerMouchel Pilbara ISALeighton Mid West & Gascoyne ISA DownerMouchel Goldfields- Esperance ISA Abigroup Wheatbelt ISALeighton / Opus South West & Great Southern ISA Fulton Hogan MetropolitanDownerMouchel

37. MAIN ROADS WA & LOCAL GOVERNMENT 2015 NATIONAL LOCAL GOVERNMENT INFRASTRUCTURE & ASSET MANAGEMENT CONFERENCE Menno Henneveld Consulting Whole-of-life costs Safety (Road Safety and WHS) Service delivery methods Local community impacts Road user expectations Economic impact Legacy value Environmental impact Trust and confidence in Main Roads KEY CRITERIA DEFINING VfM ON ROADS

38. MAIN ROADS WA & LOCAL GOVERNMENT 2015 NATIONAL LOCAL GOVERNMENT INFRASTRUCTURE & ASSET MANAGEMENT CONFERENCE Menno Henneveld Consulting What are the value expectations? Integration and collaboration Improving governance arrangements Collaboration on procurement Taking a risk management approach to asset management Applying a Safe Systems approach to design Re-thinking approaches to sustainability ACHIEVING VALUE-FOR-MONEY

39. MAIN ROADS WA & LOCAL GOVERNMENT 2015 NATIONAL LOCAL GOVERNMENT INFRASTRUCTURE & ASSET MANAGEMENT CONFERENCE Menno Henneveld Consulting INTEGRATION AND COLLABORATION ACROSS GOVERNMENTS Optimising current arrangements Developing the State State Funds to Local Government Agreement Expanded role for Regional Road Groups Building on ISA Opportunities Sharing resources Regional Sustainability

40. MAIN ROADS WA & LOCAL GOVERNMENT 2015 NATIONAL LOCAL GOVERNMENT INFRASTRUCTURE & ASSET MANAGEMENT CONFERENCE Menno Henneveld Consulting INVESTING IN THE FUTURE TOGETHER Local Government manages 88% of the network Allocated 27% of Vehicle Licence Fees Agreement represents 25% increase in funding in real terms over five years 20% of Local Government road expenditure provided by the State Planning as well as operations opportunities

41. MAIN ROADS WA & LOCAL GOVERNMENT 2015 NATIONAL LOCAL GOVERNMENT INFRASTRUCTURE & ASSET MANAGEMENT CONFERENCE Menno Henneveld Consulting When it comes to the future there are three types of people: 1.Those who let it happen 2.Those who make it happen 3.Those who wonder what happened John M Richardson Jr