Issuu on Google+

COUNCIL MANAGER SPRING 2013

SUSTAINABILITY

In Local Government

lor nt l i c e un lem o C pp Su

THE MAGAZINE FOR SENIOR MANAGERS IN LOCAL GOVERNMENT


Local Government is for the people. Maddocks is for Local Government.

Maddocks has worked with local government for over 125 years. Our leading local government team has a great wealth of knowledge of local government issues, which can only come from a truly empathetic approach. Some say we have built a local government focused culture within our firm. We call it an understanding. Knowledge + Empathy = Understanding www.maddocks.com.au Canberra | Melbourne | Sydney


CONTENTS

SPRING 2013

45 16 NEWS

12

GETTING PERFORMANCE RIGHT By Warren van Wyk.................................... 24

TOP 10 NEWS STORIES....................... 2 BEST PRACTICE IN LOCAL GOVERNMENT CONFERENCE WRAP............................................... 10

PROFILE LEADING THE WAY TO FINANCIAL VIABILITY........................ 12

ALGA REPORT

QUEANBEYAN CITY COUNCIL’S BUSINESS EXCELLENCE JOURNEY By Damian McFarlane................................. 28

ONLINE STRATEGIC PLAN GENERATES EFFICIENT COMMUNITY FEEDBACK

LEGAL BRIEFING

CLARIFICATION SOUGHT ON COALITION POLICIES AFFECTING COUNCILS

HAS COUNCIL MAINTAINED THE CONFIDENTIALITY OF ITS LEGAL ADVICE?

By Felicity-ann Lewis, ALGA President....... 14

By Kate Oliver............................................ 36

FEATURES ADELAIDE SETS THE PACE ON SUSTAINABILITY By Adelaide City Council............................. 16

46

By Warringah Council................................ 30

SENIOR POSITIONS Monitoring the comings and goings of council CEOs........................................ 38

COUNCILLOR SUPPLEMENT

Publisher: CommStrat Editor: Ben Hutchison Graphic Designer: Nicholas Thorne Contributors: Rex Pannell, Ben Hutchison, Felicity-ann Lewis, Warren van Wyk, Damian McFarlane,

COGENERATOR FEASIBILITY STUDIES MADE EASIER FOR COUNCILS

NEWS..................................................... 40

By City of Boroondara...................................18

The Mayor of Naracoorte and

Tel: +61 3 8534 5008

The Mayor of the City of Randwick............... 44

Email: yuri@commstrat.com.au

TRANSFORMING A CITY’S ENERGY USE By Townsville City Council........................... 20

COUNCIL LEADERS

COUNCIL PROFILE CITY OF STONNINGTON By Rex Pannell.......................................... 46

THE ROLE OF TRAINING IN STRENGTHENING INTERNAL CONTROLS AND MANAGING RISK By Tony Harb............................................. 22

PRODUCTS & SERVICES TRAINING FOR COUNCILS............... 48

Tony Harb, Kerrie McLeod, Kate Oliver Sales and Marketing: Yuri Mamistvalov

Subscriptions: Ruth Spiegel Tel: +61 3 8534 5009 Email: ruth.spiegel@commstrat.com.au Head office: Lvl 8 574 St Kilda Road, Melbourne VIC 3004 Post: PO Box 6137 St Kilda Road Central, VIC 8008 Tel: +61 3 8534 5000, Fax: +61 3 9530 8911 WEB: www.commstrat.com.au

Spring 2013 Council Manager | 1


TOP 10 NEWS

10

TOP NEWS STORIES

1

Councils seek clarity on Abbott Government infrastructure funding

Councils respond

to Coalition election win The ramifications for local government of the Coalition’s federal election victory will pan out over coming months, but there are already a number of key issues that councils need clarification on from the Abbott Government. These include whether project funding promised under Labor’s community infrastructure program will be honoured (in circumstances where funding allocations were announced but contracts not yet awarded). And in the wake of the scrapping of the local government referendum, local government associations will be seeking to work with the Coalition to ensure direct federal funding of local government can somehow not be threatened in future. The Coalition will also move to significantly alter environmental project funding and regulatory frameworks – and this of course will have a flow-through effect on local government. In terms of addressing climate change and embedding environmentally sustainable actions, local government is perhaps the leading tier of government in Australia. This edition of Council Manager magazine details several examples of councils that have successfully undertaken leading-edge environmental initiatives that delivered benefits to their organisations and local communities. While external funding sources and the regulations controlling carbon management in Australia are likely to change, councils will continue to set the pace in terms of government efforts to achieve a sustainable future for communities. I hope you enjoy this edition of Council Manager. Sincerely, Ben Hutchison, EDITOR, Council Manager ben.hutchison@commstrat.com.au 2 | Council Manager Spring 2013

The Australian Local Government Association is seeking clarification from the new Abbott Government on the design of the Coalition’s new regional funding program - the National Stronger Regions Fund - and the status of at least $150 million in funding pledges that had been made under the previous Labor Government’s Regional Development Australia Fund (RDAF). While the association has welcomed the new funding program, ALGA President Felicity-ann Lewis said there were concerns that funding commitments made under Labor’s program may not be honoured by the new government. During the lead-up to the election, Mayor Lewis wrote to political party leaders asking them to honour funding promises made to projects under the RDAF. Nationals leader, Warren Truss, announced during the election campaign the Coalition’s commitment to funding of $200 million a year for five years for a new National Stronger Regions Fund, which would be established in 2015. Local government associations were also seeking to work with the Abbott Government to ascertain how to embed certainty on the continuation of federal funding of councils despite the cancellation of the referendum on constitutional recognition of local government.


UPCOMING EVENTS Local Government 2.0 Webinar Series November 18 - 20, 2013 Visit www.lgnews.com.au

3rd Local Government & Public Sector Building Maintenance & Management Conference Melbourne – November 19 & 20, 2013 Visit www.buildingmaintenanceconference.com.au

2014 Digital Government Conference Canberra – March 4 & 5, 2014 Visit www.govtechreview.com.au/digitalgovernment

9th Australian Road Engineering & Maintenance Conference 2014 Melbourne – April 1 & 2, 2014 Visit www.roadconference.com.au

6th Australian Small Bridges Conference Sydney – May 27 & 28, 2014 Visit www.smallbridgesconference.com

Earth Structures & Retention Conference Sydney – May 27 & 28, 2014 Visit www.earthstructuresconference.com

Social Media for the Public Sector Melbourne – May 21 & 22, 2013 Visit www.govtechreview.com.au/publicsectorsocialmedia

Government Mobility and App Solutions Conference Melbourne – May 21 & 22, 2013 Visit www.govtechreview.com.au/mobilityapps

For further details regarding these conferences please visit:

www.commstrat.com.au/events


TOP 10 NEWS

2

Qld councils to vote on financial sustainability recommendations Queensland councils will vote on nine recommendations to improve the way councils conduct their business following the state’s first Council Regional Round Table, which was held in August. Mayors and CEOs attended the Local Government Financial Sustainability Round Table in Townsville to tackle the financial challenges facing local governments. “We are confident within a few weeks we will have a clear way forward, but already there is an overwhelming desire to improve the way we do business together,” State Local Government Minister, David Crisafulli, said. The recommendations include supercharging land use across the state, getting value for money on construction and maintenance of assets, and local government pooling resources to reduce costs for their communities. “Councils were as one in their desire to deliver more for their communities for less and we need to take a dynamic approach to resolve that dilemma,” Mr Crisafulli said. Mr Crisafulli said the round table had produced a raft of actions to ensure local government was not only sustainable, but prospered in the state.

4 | Council Manager Spring 2013

3 Embedding climate change adaptation into

4

National local

local government planning government workforce Councils in five states have formed a research partnership with the Australian Centre of Excellence for Local Government to develop practical steps for embedding climate change adaptation into the short, medium, and long-term planning of local governments. The ACELG said the outcome of the project would be a Guidance Manual of resources already developed by some councils. It said the manual would incorporate checklists, procurement clauses, risk assessment frameworks, training materials and toolkits that would assist councils mainstream climate change into their organisation. The ACELG said Australia was prone to bushfires, heat waves, drought and floods, and with many residents living in coastal areas, was particularly vulnerable to a changing climate. It said with global temperatures increasing and sea levels rising, Australia had an especially large stake in managing the environmental impacts of a changing climate. Australia, the ACELG said, was expected to face significant human and economic costs, particularly from infrastructure that was poorly equipped to handle the consequences of climate change such as extreme weather events. International consultancy, RPS Australia Asia Pacific, has been engaged to work alongside councils to develop the Guidance Manual. Other councils, as well as state local government associations, will contribute in-kind to the project. The Guidance Manual was scheduled to be completed by December 2013 and launched in early 2014.

strategy a ‘landmark’ The recent release of the national local government workforce strategy means the sector has for the first time a comprehensive approach to workforce planning and development, according to Local Government Managers Australia. The Future-Proofing Local Government: National Workforce Strategy 2013-2020 was officially released by Catherine King, then-Minister for Regional Australia, Local Government and Territories. The strategy is designed to address retention, development and attraction at a time when Australia is experiencing higher demand for skilled workers, and local government is taking on increasing responsibilities for service delivery at the local level. Funded by the Federal Government, the strategy was prepared by the Local Government Practice Unit of LGMA as a consortium partner on behalf of the Australian Centre of Excellence for Local Government’s Workforce Development Program. The strategy provides for increased investment in skills, improved productivity and the use of technology, maximising leadership and people management skills, and greater integration with the changing political and operational environment in all tiers of government. ACELG Chair, Margaret Reynolds, said implementation of the strategy required a rigorous and long-term approach by governments at all levels. The strategy was to be made available to all councils and is available to view on the ACELG website www.acelg.org.au.


5

6

NSW councils oppose

corporate planning

merger focus of Future

and reporting reforms

Directions paper The Independent Local Government Review Panel needs to greatly rethink the options on the size and structure of NSW councils it has suggested in its Future Directions – 20 Essential Steps discussion paper, according to Local Government New South Wales. After consulting with Mayors and General Managers at a forum in June, LGNSW submitted its response to the Future Directions paper, strongly opposing proposals on mass council amalgamations and its County Council model. Joint President of LGNSW, Ray Donald, said the panel’s terms of reference included “barriers and incentives to encourage voluntary boundary changes”; however the report almost overlooked this, instead offering a single-minded approach of council mergers. “While LGNSW supports voluntary council amalgamations, it does not believe there is anything in the Future Directions paper that would entice the vast majority of councils and their communities to merge with their neighbours,” Cr Donald said. “Small rural communities have not escaped the Panel’s preference for ‘big councils’, and LGNSW strongly opposes establishing 20 County Councils with regional-level functions and converting councils with small populations into Local Boards.” LGNSW instead proposes establishing ‘regional Local Government entities’ that are owned by member councils, are comprised of elected members of councils, and that match with the NSW Government’s regional boundaries.

New comparison of

A paper comparing the approaches in Australian jurisdictions to implementing local government reforms – particularly requirements for strategic and corporate planning and reporting - has been released by ACELG. The Australian Centre of Excellence for Local Government paper compares various approaches and sets out recent experience in implementing local government reforms. By comparing the rationale and the realities of planning provisions, the centre contends that considerations for future policy reforms are explored. ACELG says definitions of strategic planning in the local government context vary widely and the paper focuses on provisions for strategic and corporate planning. The paper defines strategic planning as being concerned with influencing trends and issues in the locality, irrespective of a council’s corporate responsibilities. The planning involves substantial community engagement to determine residents’ aspirations and needs. Corporate planning is defined as planning for the administration of a council’s own activities. The paper also examines various legislative reforms and provisions mandated by the different jurisdictions which set out requirements for local government strategic planning.

7 Perth councils reform ‘close’ to local government’s plan Major structural changes to Perth metropolitan local government was closely aligned to the model preferred by the majority of the sector, according to the WA Local Government Association. WALGA President, Troy Pickard, said the WA Government’s plan for 14 metropolitan councils was “close” to the sector-endorsed model of between 15 and 20 metropolitan councils. WA Local Government Minister, Tony Simpson, has announced the number of metropolitan councils would be reduced from 30 to 14 within two years through a series of amalgamations and three councils would remain unchanged. In addition, $200,000 would be provided to prepare each plan, and the government would fund transition costs in establishing the new councils. Mayor Pickard said it was now imperative that the government was unequivocal in providing the necessary financial support for councils to realise the objectives. “Based on what other amalgamations have cost in WA and interstate, we would expect somewhere between $40 million to $50 million would be required to create the 11 new entities as proposed.” He said WALGA would support local governments that wanted to make the transition to enable the proposed new entities. “It is a reality that while some councils will embrace the changes there will be others that will have their reasons to resist,” Mayor Pickard said. “At this point I think it is important that councils be measured and considered in their response to the announcement and step back and decide if what is proposed can work for their communities.” Spring 2013 Council Manager | 5


TOP 10 NEWS

8

Conservative growth in SA council CEO salaries

9 10 MAV survey targets

council rate increases

The salaries of local government CEOs in South Australia showed conservative growth of about 3% over the past four years – in line with public service CEO salary movements – according to the Local Government Association of South Australia’s latest survey of council CEO salaries. Independently prepared by AME Recruitment, the report indicates the growth was below movements in both the private and not-for-profit sectors. The association’s CEO, Wendy Campana, said her organisation would be providing more support to councils on employing CEOs and setting their salaries through guides and consultancy services. The CEO salary survey was undertaken to assist councils in making comparisons when reviewing salaries and as part of the association’s commitment to assist council transparency. “This report is overdue, but we will now be undertaking this review at the end of each calendar year,” Ms Campana said. “Sometimes we hear claims that these salaries are outrageously high, but in fact on every comparison, we do we find they are appropriate and underneath CEO salaries in similar size organisations in other governments and the private sector,” she said. 6 | Council Manager Spring 2013

Victorian councils will this year lift rates by an average of $76, or 4.8%, to address critical cost pressures, according to a survey by the Municipal Association of Victoria. Bill McArthur, MAV President, said budget restraint had been a core goal for councils, but it was never easy to strike the right balance between affordability and meeting widespread community expectations. “Cost pressures facing council budgets include the $397 million defined benefit superannuation shortfall, costs to maintain and replace ageing community infrastructure, and steady demand for services,” Cr McArthur said. “Many services for families, children and youth; aged care and public libraries are jointly funded by either state or federal governments. However the trend has been for ratepayers to cover a bit more each year because government funding has not kept pace with the cost of delivering these services.” Local government must also maintain a ‘fully funded’ superannuation scheme for people who were part of the compulsory defined benefit plan that closed in 1993. This is in contrast to similar state and federal schemes, which remain unfunded to the tune of $28.7 billion and $69 billion respectively. “While many councils have saved millions of dollars in interest by paying their super shortfall before the July 1 deadline, this challenge has not been without pain,” Cr McArthur said.

Local government helps devise new climate change standard The Australian Local Government Association and the National Seachange Taskforce were two of many bodies involved in developing the first Australian Standard dealing explicitly with management of risks associated with climate change for communities and infrastructure. Chief Executive Officer of Standards Australia, Colin Blair, said the voluntary standard was about appropriate risk management for climate change. Mr Blair said the Australian Standard would provide principles and guidelines on the identification and management of risks that communities and infrastructure faced from climate change. “It will provide a systematic approach to planning the adaptation of communities and infrastructure based on the risk management process,” he said. The standard follows the International Standard ISO 31000:2009 Risk management – Principles and guidelines. “The principles on which the standard is based recognise that climate change risk management needs to be an integral part of decision-making and based on the best information available, Mr Blair said. He said Standards Australia recognised the support of the Commonwealth Department of Industry, Innovation, Climate Change, Science, Research and Tertiary Education in developing the standard.


FRIENDS

RoMANS CouNCILLoRS

LEND ME

YouR EARS

PALADIN RISK MANAGEMENT TRAINING ACADEMY ANNouNCE ThE DIPLoMA oF RISK MANAGEMENT AND BuSINESS CoNTINuITY

The Diploma of Risk Management and Business Continuity is made up of ten Core Units: / Undertake Enterprise Risk Management / Manage Risk / Coordinate Risk Management / Manage Procurement Risk / Conduct Fraud Risk Assessments

The Diploma Course will be conducted by the Paladin Risk Management Training Academy. Endorsed by the Risk Management Institution of Australasia, this is the only broad based risk management diploma in the country and is fully accredited by the Australian Skills Quality Authority (ASQA). The Diploma Program is aimed at risk management and business continuity professionals or those aspiring to fill roles in these industries.

/ Develop Fraud Control Plans / Manage Project Risk / Apply Principles of OHS Risk Management / Manage Hazards in the Workplace / Develop and Maintain Business Continuity Plans

The Diploma Course will be conducted over a four day intensive period in the following cities: Hobart – 16-19 September Sydney – 30 Sep-3 October Canberra – 14-17 October Canberra – 4-7 November

Adelaide – 18-21 November Perth – 25-28 November Brisbane – 9-12 December

Keep yourself out of the Lion’s Den... call the PALADIN RISK MANAGEMENT TRAINING ACADEMY today

Qualifications issued by McMillan Staff Development

Rod Farrar, Managing Director 0400 666 142 rod@paladinrisk.com.au www.paladinrisk.com.au

15% DISCouNT CoDE juST uSE ThE CoDE: CMM


NEWS

MAV outlines views on new metro planning authority Victoria’s local government sector wants an independent statutory authority that can forge a whole-of-government commitment to Melbourne’s new metropolitan strategy. Planning is well advanced on the strategy, which will be designed to manage Melbourne’s growth and deliver a more coordinated approach to metropolitan planning. Bill McArthur, President of the Municipal Association of Victoria (MAV), said councils believed a new Metropolitan Planning Authority must focus on addressing issues that were only within the state’s jurisdiction to influence, rather than duplicating the role of local government. “It is expected that the authority would also ensure smooth and constructive resolution of the inevitable tensions that arise between metropolitan and local interests,” Cr McArthur said. “While generally Melbourne 2030 was a solid planning strategy, we must learn from the inadequate leadership that contributed to ongoing implementation problems. The authority must coordinate and deliver city-shaping infrastructure and services that address prioritised needs.” Cr McArthur said mobilising partnerships with regional groupings of councils, facilitating land acquisition and investment, and raising funds to deliver key services and infrastructure, had been identified as potential core functions. “The MPA should also be responsible for monitoring and reviewing implementation of the strategy to ensure it remains fitfor-purpose and evolves as circumstances change,” he said. “But what we don’t want to see is the authority making decisions about planning scheme amendments and permits on local issues; or oversighting neighbourhood planning undertaken by councils.” Victoria’s Planning Minister, Matthew Guy, announced the establishment of a new Metropolitan Planning Authority earlier 8 | Council Manager Spring 2013

this year to assist with implementing the metropolitan strategy, and sought the views of councils on its operation. To inform this process, the MAV has worked with councils to develop a preferred operating model, which was presented to Mr Guy in August.

Melbourne a global

emissions. If you need finance to enable a retrofit, we can facilitate it through the Sustainable Melbourne Fund,” Lord Mayor Doyle said. “Our unique Environmental Upgrade Finance mechanism, using council rates to provide the security for the loan, has now been replicated in other municipalities in Australia.”

leader in sustainability

New ICAC welcomed by SA local government

The City of Melbourne has been recognised as a global leader in cultivating green buildings, receiving a prestigious international award. Lord Mayor, Robert Doyle, was presented with the C40 and Siemens Climate Leadership Award in the category of Energy Efficient Built Environment at a recent ceremony in London. Berlin and New York were also shortlisted for the award. Lord Mayor Doyle said Melbourne was recognised as having some of the smartest buildings in the world. “We know that our retrofitting program 1200 Buildings is expected to generate economic uplift of $2 billion and create 8000 jobs,” he said. Melbourne’s pioneering efforts to create an energy efficient landscape for retrofitting existing buildings and setting minimum standards for new buildings have led to the highest density of new green buildings in Australia. “We are providing building owners with the tools and the know-how to reduce energy use, save water and lower carbon

The Local Government Association of South Australia says the state’s new Independent Commissioner Against Corruption and new Office for Public Integrity are welcome additions to probity arrangements for state and local governments. The ICAC, Bruce Lander, and the Office for Public Integrity officially started operations on September 2. The association’s President, David O’Loughlin, said Commissioner Lander had indicated his desire to work with the association and councils in several meetings. “I believe unexposed corruption, where it occurs, presents a far greater risk to public confidence in any government, than exposing corruption and dealing with it,” Mayor O’Loughlin said. “The only people who should have any concern about the role of both new bodies are those engaging in suspect activities.” He said the association had a history of working to develop good practices with councils and responding to Ombudsman’s recommendations and Parliamentary concerns with models, guides, standard operating procedures and training to support councils. “Most of these tools have been updated with references to the ICAC included where appropriate,” Mayor O’Loughlin said. “While no new offences are created and any untoward activities should have been reported to the police, I believe the ICAC and the Office of Public Integrity will bring a more accessible public profile to the importance of identifying and weeding out corruption.”


esses operate c o pr r u o w ho g Understandin cal component to ti ri c a is rm o rf and pe a high performing be to nt e m it m m o gic ou r c ated in our strate st is is Th .. n. o ti organisa ur hich underpins oAH NG community plan w mes" WCOARURI NC IL community outco


BEST PRACTICE IN LOCAL GOVERNMENT 2013

2013 Best Practice in Local Government Conference the biggest yet

M

ore than 200 local government professionals from across Australia attended the recent 2013 Best Practice in Local Government Conference in Melbourne to hear expert analysis and leading examples of local government organisational development and performance improvement solutions. The sixth time the conference has been staged, the 2013 event saw a wide range of presentations detailing how local governments can strengthen organisational culture, pursue continuous improvement and achieve business excellence. Other topics discussed included how to implement successful leadership development initiatives and improve corporate management systems and technologies. CEO presentations included an address from Kerry Thompson, CEO of Wyndham City Council, who detailed how she is leading Wyndham at a time when the municipality is experiencing one of the fastest residential growth rates in Australia. Other CEO presentations included: an address by Paul Buckley, CEO of Latrobe City Council, on methods for improving organisational performance; a presentation by Bass Coast Shire Chief Executive Allan Bawden on ‘Business Planning for Financial Sustainability’; and a presentation by Hobart City Council General Manager Nick Heath.

Learnings from the wider public sector Alan Lilly, Chief Executive of Eastern Health – one of Melbourne’s largest public health networks – detailed the successful 10 | Council Manager Spring 2013


Parramatta Council wins Employer of the Year Award

implementation of a scorecard used by Eastern Health to help drive, measure and monitor organisation-wide improvements. Alan also discussed the critical link between strategy and operations in a complex organisation.

Strengthening organisational culture Moreland City Council’s Gerry Smith and Anita Craven detailed how their organisation has developed a culture of performance accountability through implementation of an integrated suite of HR, OD and corporate planning and performance programs. In an innovative move, traditional functions of corporate planning and business improvement were combined by Moreland City Council with a range of culture building and leadership development activities. The organisation has since seen a shift in individual leadership capacity, organisational culture results and an improvement in achievement of organisational KPIs. The City of Salisbury’s Senior Coordinator Organisational Development, Nicole Newton, revealed how her council has adopted Leadership Branding and implemented leadership principles to develop leaders at all levels of the organisation and promote constructive behavioural styles. The branding is instilled into job descriptions, induction, the performance development process and learning and development programs in order to embed the leadership behaviours into the organisation.

The conference also saw the announcement of Parramatta City Council as the winner of the 2013 Local Government Employer of the Year Award, a competition coordinated by LG Jobs – Australia’s leading employment website for the local government sector (available at www.lgjobs.com.au). Parramatta City Council’s Manager Human Resources, Jodi Dickson (pictured above), accepted the 2013 Local Government Employer of the Year Award trophy at the conference from LG Jobs General Manager, Chris Atkin. The award recognises Parramatta City Council as an employer of choice and a leader in workplace practices. Parramatta beat entries from councils across Australia to claim the award. The award recognises those local governments that have shown a commitment to innovative and successful HR measures, and developed a productive and harmonious workplace for employees. Finalists for the 2013 LG Jobs Local Government Employer of the Year Awards were Baw Baw Shire, City of Charles Sturt and the City of Port Phillip. The 2014 Best Practice in Local Government Conference will be staged in Sydney. Information about the event will be available shortly at www.lgnews.com.au/lgbestpractice

Spring 2013 Council Manager | 11


CEO PROFILE

Council Manager: Peter, could you walk us through the main challenges you have faced as Palerang’s General Manager. Peter Bascomb:

Leading the way to financial viability Peter Bascomb, General Manager of Palerang Council in rural New South Wales, details how his organisation has addressed its considerable fiscal challenges.

A

ppointed Palerang Council’s inaugural General Manager after the municipality was created as a result of amalgamations in 2004, Peter Bascomb was immediately confronted by a range of serious financial issues that threatened the fledgling local government’s future viability. Palerang Council was proclaimed following an amalgamation of all of Tallaganda Shire Council, 44% of Yarrowlumla Shire Council and parts of 12 | Council Manager Spring 2013

Mulwaree, Gunning and Cooma-Monaro councils. It now services a residential population of about 14,000 spread across townships and rural areas. In the following edited extract of an interview with Council Manager magazine, Peter details the considerable challenges he faced as General Manager when he joined the council, how they have been addressed, and the manner in which the council is seeking to maintain its financial viability into the future.

Palerang was formed by the forced amalgamation of a number of councils back in 2004 and I joined as the first permanent General Manager in January 2005. To say that it was a misguided amalgamation is probably a bit of an understatement. The NSW Government had set up a regional review looking at the 10 councils around the ACT and that review recommended two super councils. That proposal was not politically acceptable and the then Minister put forward an alternate proposal that meant that 10 councils were changed in various ways to become 7. Palerang was created by the merger of the bulk of Yarrowlumla and all of Tallaganda and bits and pieces of Goulburn, Mulwaree, Gunning and Monaro. In the process, some of the more valuable areas of Yarrowlumla were incorporated into Queanbeyan. Unfortunately, when they did the budget for the proposed organisation they moved the costs out for these areas, but didn’t move the rates out. So the barely break-even budget that they thought would be sufficient and that was reported by the Boundaries Commission as being potentially viable in the short term but not in the long term was in fact fundamentally flawed. On Day One I was given a letter from the Auditor indicating that he had real concerns about the Shire being a “going concern”. In addition to that, there were a number of other constraints in the legislation and proclamation that created the Shire. Firstly there could be no forced redundancies in the first three years, but for small rural areas such as Braidwood, there was also what I call the “never-ever clause” in that there would be no reduction in staff numbers ever. While I understand the motivation for such constraints, they do make it difficult when you’re trying to optimise the organisational structure to maximise value for the community. So we were sort of behind the eight ball from day one. In addition to that, there


were some other issues that were sitting on the sidelines. The State Government compulsorily acquired our office building in Queanbeyan forcing us to move the staff into new offices and they gave us 10 weeks to move out. So we had to move into temporary transportables while the new office buildings were designed and built.

building an alternate waste collection system, including transfer stations. Unfortunately, like many local governments, there had been no money put aside to undertake this work. We introduced what we call a general waste charge and that covers the nondomestic waste services that shifted some $600,000 out of the general funding to a separate charge, helping free-up funds and enabled us to commence work on addressing the serious environmental issues that we had with our waste management. Then we did similar things with the sewerage systems because we had a failing sewage treatment plant…and then we did water and then moved on to the general funding, parks, gardens, roads and all those other things paid for by general rates.

“In the first couple of months I was there I kicked off 20-year strategies for a number of our services with a view of making sure they were self-funding. “ How did you ensure the council’s elected members worked with you to address the concerns you There were some EPA notices on sewerage raised about the challenges faced and landfills so there were quite a lot of by your organisation? knock-on challenges hitting us all at once. For the first three or four years it was really a basic struggle for survival and we took some fairly extraordinary measures. At one stage I had a fair proportion of outdoor staff painting guide posts or grubbing out table drains on our rural roads and that sort of thing because I couldn’t reduce staff numbers. But I could cut plant and material costs so that was one of the things we did. We cut asset renewals to almost down to zero, as well as reducing services, such as the number of maintenance grades for unsealed roads.

How did you actually improve the council’s situation, particularly your financial issues? In the first couple of months I was there I kicked off 20-year strategies for a number of our services with a view of making sure they were self-funding. The first one we completed was the waste services. We had seven landfills, two of which were at capacity and were starting to receive EPA notices. On average those seven landfills were estimated to cost $600,000 to close and rehabilitate, and we also had the cost of

It really was about presenting the business case. It certainly helped when we had external factors such as the bank freezing our credit. That drives home a pretty hard message. I think we remain the only local government in Australia to ever have its credit frozen. We couldn’t even write a cheque against our overdraft. By December 2005 I was able to present a report to council with the help of a new finance manager that June 30, 2006 was going to be a difficult date when we actually had to bring everything into balance. Fortunately that did focus the councillors’ minds and given the angst that accompanied the birth of Palerang and the ongoing issues about east/west and the divisions that had caused in the past (antipathy between primarily Yarralumla and Tallaganda as the two major components of Palerang) it actually galvanised them and that first council ended up working pretty well as a team with the primary focus of rescuing the finances. Now that focus has become diluted over the years as we have moved past the critical stage and the councillors elected in 2008 are now starting to think of some other services that we might not have previously considered.

What’s your situation now financially - are you reasonably robust going into the future? We’re reasonably robust at the moment. I guess we are one of the surprise packets, no-one expected Palerang to survive. T-Corp recently rated Palerang as having “moderate sustainability”, which is the bare minimum – and certainly better than weak or very weak. Our challenge is the T-Corp’s rating for our outlook. They rated our outlook as negative so while we are sound now, we have, like many Councils, an infrastructure backlog that we are finding hard to fund. We’ve still got time to address that and we are starting to seriously address that now. At this stage we are now starting to consider what assets we keep and where our service levels are set. That will be an interesting conversation between the community and Council over the next 12 to 18 months.

Out of all your experiences in your years at Palerang, what lessons have you learnt that you think you’d like to pass on to other senior managers in local government? Well, it’s a lesson that I brought with me from my private enterprise experience, it really is that you do get down to the financial numbers, you do have to think of the long-term consequences of decisions. As I say to my councillors and my staff, local government doesn’t build assets, it builds liabilities and you have to factor that liability into your long-term thinking. It’s fairly easy for the council and the community to raise funds to build a new swimming pool or something but it’s much harder to find the ongoing operational and maintenance costs every year. And that’s a paradigm shift for many, and it’s a hard thing to achieve. It’s very easy to get money for something the local member or the relevant minister can come along and unveil. It’s very hard to get money for what the real costs in local government are, and that’s the ongoing maintenance and operation of our infrastructure and services the roads, the bridges, the swimming pools, the community halls, that sort of thing. Spring 2013 Council Manager | 13


Council Manager Spring 2013 Sample