Regional Workshop

1. Regional Workshop 22/09/2015 Cairns

2. Workshop agenda • An introduction to Better Councils Better Communities campaign • A performance reporting discussion with participants • An introduction to the performance benchmarking tool: Ready. Set. Go • Understanding the key performance indicators • Reviewing financial sustainability in Ready. Set. Go. • Performing performance assessments in Ready. Set. Go. • Benchmarking in Ready. Set. Go. • Benchmarking methodology • Macro benchmarking themes for QLD local governments in Ready. Set. Go. • The next steps for Ready. Set. Go. • Workshop: the future direction of Ready. Set. Go. Participants to shape what they need in a performance benchmarking tool

3. Better Councils, Better Communities.

4. Two Driving Issues: Money / Financial Sustainability Community Perceptions & Attitudes

5. Growing funding gap, currently $800m pa.

6. Why is there a need for the campaign? > Queensland Government: Whole of Government Service Delivery Research

7. QLD Believe: 1 Morning T Queenslanders’ Believe … 63%believe that … local government is an essential layer of government. BUT ONLY 3/10believe that … councils deliver value for money

8. Queenslanders’ Believe … 70%believe that … they are satisfied with their council. BUT ONLY 3/10believe that … councils look for ways to improve productivity and efficiency.

9. Council People Believe Morning Tea Local Government People Believe … 47%believe that … we look to ways to improve productivity and efficiency. 35%believe that … we deliver value for money. 7/10believe that … it is important to be able to compare financial performance with other councils.

10. Five Features of the Campaign:

12. Benchmarking: 2 Provide comparative data of council performance in a practical, useful and engaging way. Utilise existing data already in the public realm, no additional administrative burden on councils. No public release of individual council data until after 2016, and further consultation with Members.

13. Benchmarking: 3 Because over 70% of councillors and council staff surveyed said they would value this information. Opportunity for Queensland councils to demonstrate leadership, and maintain control of their own data. Because less than half of those surveyed believe councils actively look for ways to improve productivity and efficiency and only 35% believe theydeliver value-for-money.

14. Benchmarking: 3

15. Benchmarking: 6 It’s impossible to compare my council. We are unique! Our council shows up as one of the poorest performing in the category. Your data is flawed, wrong, invalid. Others will use this data against us / me for political gain or to cause embarrassment. This information will be leaked to the media / community.

19. Other Supporting Services.

22. Workshop question How does your council measure and report on performance? Do you look to other council’s performance? Have you used the benchmarking tool?

23. Introduction to performance benchmarking Understanding performance benchmarking in Ready. Set. Go. Key performance indicators How performance benchmarking is measured Sources of data Benchmarking groups How councils are grouped for comparisons What is the information telling us

24. Key performance indicators Ready. Set. Go. Features 24 key performance indicators from 5 categories: General Sustainability Revenue Efficiency Service level Operating Expenditure per capita Employee costs as % of operating expenditure Time lost to accidents per employee Population serviced per employee Operating Surplus Ratio Net Financial Liabilities Ratio Asset Sustainability Ratio Working Capital Ratio Debt per capita Population Population density Average age Gross regional product GRP per capita Avg. persons per household Avg. weekly household income Asset Consumption Ratio CRC of asset base per capita Urban road length serviced per capita Urban road length serviced per capita Total road length serviced per capita Parks area serviced per capita Library issues per capita Rating effort Reliance on rates & charges Reliance on contract works Reliance on operational grants

25. Key performance indicators Targets and Importance • Targets • Targets can be either: • Best practice as described by the relevant government department • A peer group average for perspective • A target set by the user Importance The relative importance of a key performance indicator is denoted by the star symbol in Ready. Set. Go.

26. Key performance indicators Confidence in data: data sources and quality Imperative to ensure data is as accurate as possible Objective: maximise confidence • Published sources: • Financial Statements/Annual Reports (consolidated level) • QAO • DLG Comparative Information • ABS • AEC GRP • Other (e.g. SLQ)

27. Key performance indicators Confidence in data: data sources and quality Data is only as good as its source but has been optimised where possible to default to the most reliable source (e.g. annual reports) Data for 2014/15 is yet to be published Asset sustainability ratio prior to 2013/14 is patchy as wasn’t required to be reported As data is released, Ready. Set. Go. will be updated

28. Key performance indicators Key performance indicator application in Ready. Set. Go. KPIs Overview of council key performance indicators by category Dashboard view of council key performance indicators KPI explorer Trend Historical comparisons of multiple key performance indicators Compare Benchmark individual key performance indicators against peers

29. Key performance indicators Financial sustainability review exercise in Ready. Set. Go.

30. Key performance indicators Financial sustainability review in Ready. Set. Go. Excerise material Aec to demo other combos or talk Requests from participants

31. Key performance indicators Financial sustainability review in Ready. Set. Go. Excerise material Aec to demo other combos or talk Requests from participants

32. Key performance indicators Financial sustainability review in Ready. Set. Go. Excerise material Aec to demo other combos or talk Requests from participants

33. Key performance indicators Financial sustainability review in Ready. Set. Go. Excerise material Aec to demo other combos or talk Requests from participants

34. Key performance indicators More performance assessments in Ready. Set. Go. Asset management assessment: Indicator #1: Replacement cost of assets per capita Indicator #2: Asset consumption Ratio Indicator #3: Asset sustainability ratio

35. Key performance indicators More performance assessments in Ready. Set. Go. Revenue assessment: Indicator #1: Reliance on Rates and Charges Indicator #2: Reliance on Operational Grants Indicator #3: Reliance on Contract and Recoverable Works

36. Workshop question Do you look to the performance of similar councils?

37. Performance Benchmarking Benchmarking methodology in Ready. Set. Go. Benchmarking objectives Provide an interactive assessment of performance (and cost drivers) relative to your peers Identify and learn from leaders Question your practices vs best practice

38. Performance Benchmarking Benchmarking methodology in Ready. Set. Go. Your council’s benchmarking peer groups Australian Classification of Local Government Regional Organisations of Councils and Associations LGAQ/AEC Financial Sustainability Segments Population Size

39. Performance Benchmarking How to access benchmarking functionality in Ready. Set. Go.

40. Performance Benchmarking What is performance benchmarking telling us? Operating Surplus Ratio (prior report) Indigenous and SEQ segments found to be experiencing persistent deficits (on average across each segment)

41. Performance Benchmarking What is performance benchmarking telling us? Operating Surplus Ratio 2010 - 2011 Indigenous and SEQ segments found to be experiencing persistent deficits (on average across each segment)

42. Performance Benchmarking What is performance benchmarking telling us? Operating Surplus Ratio 2013 - 2014

43. Performance Benchmarking What is performance benchmarking telling us: Operating Surplus Ratio Difficult to identify actual trends over the past four years 65% of Councils in deficit in 2013/14 (55% in 12/13, 50% in 11/12, 44% in 10/11) SEQ appears stronger than 4 years ago Resources, Rural/Remote and Rural/Regional worse off BUT look beyond the numbers – only 50% FAG payments made during 2013/14 due to prior year prepayments Things should normalise from 2014/15

44. Performance Benchmarking What is performance benchmarking telling us? Net Financial Liabilities Ratio (prior report) Coastal and SEQ segments found to be experiencing heightened funding pressures (on average across each segment)

45. Performance Benchmarking What is performance benchmarking telling us? Net Financial Liabilities Ratio 2010 - 2011

46. Performance Benchmarking What is performance benchmarking telling us? Net Financial Liabilities Ratio 2013 - 2014

47. Performance Benchmarking What is performance benchmarking telling us: Net Financial Ratio More consistent trend of relatively high ratios for Coastal and SEQ A few Rural/Regional Councils popping up to potentially more dangerous levels

48. Performance Benchmarking What is performance benchmarking telling us: Debt per capita Provides a good indicator of the level of debt relative to your population base Comparisons with like councils can be telling

49. Performance Benchmarking What is performance benchmarking telling us: Debt per capita Debt per capita ~ Coastal Councils 2013 - 2014

50. Performance Benchmarking What is performance benchmarking telling us: Debt per capita Coastal (example low)