Productivity Council Publishes Draft Report Ahead of Time.

The Productivity Council has released the draft report I recently blogged about. They have done this ahead of time to maximise the Local Government sector’s opportunity for an informed response.

 

As the Productivity Council’s report will feed into the Government’s Local Government reform agenda, I interrupt my series on the reforms to include this.

After being briefed by the PC chair yesterday I am gratified at their efforts to truly understand the industry. They have consulted well. Their draft report, on the surface, recognises the constraints under which the local government industry operates. Their report certainly does not present as the Government, I suspect, may have expected.

They recognised that just under 50% of our activities are mandated. Activities over which we have no control. It recognised the cost shifting State Governments of both persuasions thrust upon local government. The chair preferred to call this cost sharing. Nonetheless it was recognised.

It also recognised the need for local government to develop in the non-mandatory areas in keeping with the needs of their community.

Finally, it recognises that wages growth in the sector has escalated beyond CPI. This is an important conversation in that wages represent 1/3rd of our costs.

In other words, the report demonstrates that the Local Government sector, by running a tape measure over it relative to each other, as being an efficient sector. This diagnosis albeit with a caveat that there is significant room for improvement.

 

The report, which can be read here, makes three distinct recommendations. They are as follows:

 

  1. Lift the capacity of local councils to identify and address opportunities to reduce their cost base and improve their operations.
  1. Facilitating bench marking by clusters of councils through an appropriate mix of incentives for councils to participate and expectations that they will report information publicly in a format consistent with the framework.
  1. Further lower council costs by addressing aspects of the relationship between the South Australian Government and local government.

The Commission is looking for a response from us (councils and the community) on the draft report. Before preparing the final report to be presented to the minister, they are asking us 19 specific questions they are still seeking answers to.

We have until the end of next month (October) to do this in order they meet the deadlines imposed on them by the Government.

New probe into council spending to push reforms

New probe into council spending to push reforms is the headline today in the IN Daily on line news. This spells the next chapter in the push for Local Government Reform.

 

Having failed in its attempt to cap council rates, the Government is now promoting they intend  to establish new probe into council spending to push reforms by the state’s Productivity Commission. This is good news in my opinion.

South Australian Premier Steven Marshall and Transport Minister Stephen Knoll (AAP Image/Kelly Barnes)

I welcome this move as a construction move. I expect the local government industry will too. Certainly, the article indicates the LGA president (Sam Telfer) is in support. We will no doubt discuss this among ourselves in the next short period of time.

Investigating what is a myriad of differences in what the various councils do and how the fund them is the right approach to reform. This will definitely be of benefit to the local government industry.

Each council should eagerly participate in this exercise. They should also be eager to see the results. Such an exercise would help in our efforts to gauge our performance against other councils.

We often try to compare ourselves to other councils. We do so as a guide to how well we may or may not be performing. That has always proved most difficult. It is because of the differences between us in how we go about things. Likewise in how we fund them. Furthermore, it is how we record them.

I would expect your elected representatives will be better informed in decision making. Our administration likewise will have more confidence with what they may put before the elected members. The big benefit will be yours however.  You can then better value what your Council is doing for you compared to what others are doing for their communities.

Done right and down well however will take some significant resources. I expect it will take some serious time too.

Local Government Reform recommendations out for Public Consultation.

Local Government Reform recommendations are finally out for Public Consultation. The Government now wants to hear from you.

 

Local government reform and cutting the cost of local government was one of the election platforms of the State Government. They lost out to the Opposition and the Minor Parties with their blunt rate capping strategy. Notwithstanding this, they have been working hard on coming up with a suite of legislative changes that are aimed at a more efficient local government sector.

The local government industry has been in conversation with them since they took office. This continues the dialogue we had with the previous government. As I have blogged before, change is needed.

They now want to hear from you, and me.

With a view to introducing a draft bill in March next year the Minister has endorsed 72 recommendations. He is keen to know what we all think about these proposed changes. We all have until November 1st to provide our feedback.

If you have an interest in how local government might best serve you, here is perhaps your best chance. Go to the DPTI website and read through the recommendations.

If you have an opinion on any of them please make it known through their have your say. You can do this on the have your say page.

The 72 Local Government reform recommendations are spread over 4 areas.

The areas are as follows:

In summary, the proposals for reform are—

Reform Area 1 | Stronger Council Member Capacity and Better Conduct

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Reform Area 2 | Lower Costs and Enhanced Financial Accountability

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Reform Area 3 | Efficient and Transparent Local Government Representation

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Reform Area 4 | Simpler Regulation

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While this plays out they are also awaiting the report from the Productivity Commission. When their report is received it will sit alongside the survey results to inform their 1st draft bill.

I will be contributing, not just through the submission from Unley Council, but on my own volition. Watch out for future blogs for my thoughts.

Serious Local Government Reform

Serious Local Government Reform is about to commence with an inquiry into local government costs and efficiency.

The State Government has asked the South Australian Productivity Commission to investigate local government. They have asked them to examine the trends in council costs and the efficiency and the drivers behind these trends. In order to get it right, they will consult local government and other key stakeholders.

This is all good news for me as I indicated in my blog back on May 24.

The LGA is seeking feedback from member councils to inform a sector-wide submission. Therefore, they will be hosting a workshop session with the Productivity Commission.

On your behalf, I intend to attend this session. As a result, I expect to get a good understanding of the approach they will be taking.

The inquiry will examine trends in the costs of local government and the drivers of these costs. It will also develop and analyse measures of efficiency resulting from the trends they have discovered. Likewise, it will identify ways that might be used by councils to measure and improve performance.

The exercise will result in the Commission providing advice and recommendations on options for improving efficiency in local government operations.

Council Rates AnalysisAs the table shows, your rates have increased well ahead of the CPI. They have also risen in excess of the LGPI (Local Government Price Index).

The Commission will identify the drivers of the increase in your rates.

This may include changes to the scope of services provided by councils. It will also identify changes in the environment within which councils operate. Likewise it will reveal ratepayer preferences for greater levels of service.

A final report is expected to be ready for submitting to the Parliament by November this year. I look forward to the results of this serious approach to Serious Local Government Reform.

Ombudsman Code of Conduct Concerns focuses on the trivial not serious.

The State Ombudsman, Wayne Lines, has spoken up this week on a topic that goes to the heart of one of the central reasons for Local Government reform. His code of conduct concerns is one area that the Local Government Industry is pushing hard to see changed.

 

We need tougher sanctions against those who are guilty of serious breeches. More on that however in a later blog post.

His code of conduct concerns however is asking Councils to stop the silliness. To stop making claims of a trivial nature.

Wayne Lines-OmbudsmanIn recent history there have been many reports of elected members making frivolous claims against one another. This brings the industry into disrepute. These claims take up the resources of the Ombudsman. His time can be better spent on the more serious. The ICAC likewise.

Trouble is the Act requires members to lay claims against others they believe to be contravening the Act. Failure to so do can cause a claim being made against them.

Not long after the Office of Public Integrity was formed, I remember him saying to a group of councillors that he has no interest in pursuing such. Legal advice however has interpreted the law literally. Ever since the industry and the ICAC have been calling for changes.

Here at the City of Unley we hopefully have a mature and adult approach to elected member behaviour. The current Council is working through a charter of behaviour that we will all sign up to when complete.

The Governments proposed probe through the Productivity Commissioner into local government should look into this.

ALGA welcomes proposed $1.1 billion extra funding to Roads to Recovery

Below please find another press release from the Australian Local Government Association

 

The Australian Local Government Association (ALGA) welcomes and strongly supports the proposal today by the ALP to direct the revenue from the first two years of the fuel excise indexation, estimated to be $1.1 billion, towards additional Roads to Recovery funding for Local Government.

The President of ALGA, Mayor Troy Pickard, said: “We applaud the Opposition’s focus on Local Government and their recognition in this policy initiative of Local Government’s important role in developing local economies and creating jobs through projects funded through the Roads to Recovery Program.

“The Roads to Recovery program is vital for improving the state of our local roads network and the initiative put on the table by the Opposition is a great option for delivering substantial increases in resources for councils to continue this important work.

“This initiative is particularly welcome at a time when Local Government is under financial pressure following the decision to freeze the indexation of Financial Assistance Grants, costing councils an estimated $925 million in the period to 2017-18.

“Local Government faces a huge task in managing our local roads infrastructure, which is more than 670,000 kilometres in length and valued at more than $165 billion. This infrastructure plays an essential role in sustaining local economies by connecting freight networks across regions.

“The proposal underlines the continued commitment of the ALP and, in particular of Anthony Albanese, Shadow Minister for Infrastructure and Transport, and Julie Collins, Shadow Minister for Regional Development and Local Government, to the Local Government sector.

“It also underlines their capacity, even in Opposition to put Local Government at the centre of policy initiatives aimed at enabling councils to deliver essential infrastructure for their communities, create jobs and contribute to productivity improvements across the nation. Councils across Australia will be appreciative and thankful to the Shadow Ministers for this great initiative.

“We’re calling on the Government to accept the ALP’s proposal and confirm that the revenue collected from the first two years of a return to indexation of fuel excise will be directed towards additional Roads to Recovery funding.”