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Appendix G : Progress in Developing Performance Indicators for Local Government

The States have provided the following updates on their progress towards developing performance indicators for local government:

New South Wales

New South Wales produced its 1999-2000 Comparative Performance Information publication in 2000-01. For a number of years the Department has been collecting information from councils in addition to the material needed for the Comparative Performance publication. The other data collections have been used to calculate financial assistance grants and to analyse councils' financial health. The data for the comparative performance publication was emailed to councils for confirmation.

Ten new indicators which focus on accountability to the local community have been included in the 1999-2000 publication. The Department has expanded rate income information. The Average Rate per Assessment series now includes data on farmland and business rates. An average rate (total ordinary rates) per capita has also been included. Sources of total expenditure has been included to compliment the sources of total revenue that has been reported on since 1993. Both sets are also presented as per capita figures.

A capital expenditure ratio has also been developed to determine councils' ability to match capital assets to the consumption (depreciation) of assets.

Due to a number of councils failing to meet statutory reporting requirements, the Minister for Local Government has requested details of councils' ability to report in a timely manner. Consequently, the Department has included details of councils' lodgement of their Annual, Financial, and State of the Environment reports in the Comparative Performance Information publication.

The 2000-01 publication provides time series data for each indicator. New South Wales will continue to review and develop appropriate performance measures.

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Victoria is improving the efficiency and effectiveness of local government in delivering services by developing a performance culture, implementing best value and improving asset management practices. Victoria is continuing to develop a performance culture by encouraging councils to use and publish indicators in public documents such as the annual report, thus driving the accountability for performance to the local community and constituents.

Ten Victorian local government indicators were developed in consultation with the sector to replace the 29 annual plan indicators. Each council will publish details, in the report of operations section of their annual reports for 2000-01, on seven of these indicators. The remaining three Victorian local government indicators are still being developed. Review and refinement of the 47 comparative indicators is progressing.

The constituent satisfaction survey was completed for the fourth consecutive year with 76 councils participating on a voluntary basis in a survey that was essentially the same as for the three previous years. The survey showed that by 2001 across Victoria the percentage of respondents rating councils as 'excellent' and 'good' had increased 10 per cent over the percentage in 1998. Since 2000, community satisfaction with overall performance of councils across Victoria has increased marginally from 47 per cent of respondents rating performance as 'excellent' and 'good' to 48 per cent. Services that most impacted on satisfaction were town planning policy and approvals and economic development. Councils have generally widely publicised their performance results.

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The principal aim of the Queensland Department of Local Government and Planning's performance management programme is to produce an annual publication of comparative performance information. This is to help local governments evaluate their performance through comparisons with each other, as well as help them establish benchmarking and performance measurement systems.

Under this programme, the Department released its second comprehensive comparative report in September 2000, titled 1998-99 Queensland Local Government Comparative Information. This was followed by the release of the 1999-2000 edition in June 2001. This edition included year-on-year data comparisons (from 1997-98) to provide a more comprehensive picture of how local government performance has improved over time.

The comparative report provides a suite of efficiency, effectiveness and quality of service indicators for key local government functions including financial operations, road maintenance, water, sewerage, waste management, library services and parks and gardens as well as comparative rating and financial information. In addition, contextual information, such as population, population growth, population density, climate, terrain and soil types is provided for each local government to provide a context for the performance information collected and to help compare councils across Queensland.

The published performance indicators are reviewed annually to ensure their appropriateness and usefulness for local government. This ongoing review has resulted in some minor changes being made to a small number of indicators and their associated data definitions, in both the 1998-99 and 1999-00 Reports.

To further help councils understand the fundamentals of comparative performance measurement, the Department facilitated several performance management training seminars and benchmarking workshops, during 2000-01, with a number of local governments who requested the service.

With the system for publishing the comparative report now well established and accepted by Queensland local governments, the Department aims to expand its performance management programme in 2001-02 to include initiatives which focus on promotion of best practice initiatives and fostering of a continuous improvement culture within councils.

Such initiatives may include developing case studies that demonstrate current best practice in local government performance management and benchmarking as well as establishing networks to encourage exchange of information and best practice ideas.

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Western Australia

Since 1996, the Western Australian Local Government Act has required local governments to identify principal activities, their objectives and the performance indicators to be used to measure the achievement of those objectives.

During 1999-2000 a Commonwealth grant was obtained from the Local Government Development Programme, to help determine service delivery objectives for local government in Western Australia and measure the effectiveness and efficiency with which those objectives are achieved. The initial objective proved impossible due to the lack of identifiable, common objectives and operational environments. Those indicators that had been developed by local governments tended toward efficiency rather than effectiveness, with infinite variety and rarely with any identifiable relationship to major strategic objectives. Differences in operational environments also detracted from the comparability of such indicators.

It was clear that local governments were reluctant to voluntarily cooperate in a performance measurement process that was not closely linked to strategic planning and performance management. It had to be of direct benefit to councillors and senior managers and assist them to better meet community needs and expectations.

The project's research of world's best practice indicated that the nexus between the functional objectives and the performance achievements was essential if the indicators were to be true measures of performance effectiveness rather than merely the measurement of inputs and outputs. Thus, it became apparent that the primary focus was a necessity to help local governments identify objectives that were capable of measurement for both short- and long-term activities or projects. Once such principles were in general practice, secondary or subsequent phases could focus upon identifying the types of comparable objectives and indicators that were being developed in response.

The part of the project that focused upon determination and measurement of objectives was published in the form of the Performance Measurement Guidelines for Western Australian Local Governments in February 2001. All Western Australian local governments and Indian Ocean Territories received two copies each.

The Western Australian Department of Local Government is working on developing the comparative indicators project aiming initially at improving the quality of data being received for processing. The comparative data for the six-year period from 1994-95 to 1999-2000 was set to be published in time series format during 2001-02.

The Western Australian Local Government Association is committed to continuous improvement of processes and services within local government. It has contributed to development of key performance indicators through its Best Practice Training Programme on Comparative Indexing for Performance Measurement. As part of the training programme, key performance indicators have been established for road maintenance, waste management and library services.

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South Australia

In South Australia, work on development of performance measures continued to be led by the Local Government Association of South Australia (LGASA) through its Comparative Performance Measurement project. It was agreed, at the outset of the project, that leadership by local government in this area is the most likely strategy to achieve ownership and commitment of the process and its outcomes by councils. The Office of Local Government is represented on the project's steering committee. Early work on the project confirmed that, generally speaking, local government in this State is supportive of a sector-wide comparative performance measurement system.

The four key outcomes of the project are:

  • development of performance measures that can be used for comparative purposes;
  • collection of performance information on a uniform basis;
  • a measurement system that will enable councils to compare their performance with others; and ultimately,
  • implementation of benchmarking between councils.

A partnership approach was adopted whereby central leadership and support is being provided through the project, whilst participating councils make a commitment in terms of both direct effort and resources. A number of councils volunteered to be pilot sites for development of corporate-level comparative indicators in the areas of governance, financial and asset management, community satisfaction and quality of life, which are considered to be the core responsibilities of local government in this State.

Data and other information needed for the comparative measures will be collected by the LGASA from a range of sources including the Local Government Grants Commission, the Australian Bureau of Statistics, councils and a community survey in each council area. The community survey is being designed to provide vital contextual information within which performance measures can be interpreted.

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The aim of the Tasmanian Measuring Council Performance Project is to implement a comprehensive framework of key performance indicators (KPIs) for Tasmanian local government.

The KPIs will provide an industry-wide framework for measuring and comparing the performance of councils. The KPI system will:

  • enhance performance measurement by councils;
  • enable benchmarking and identification of best practice;
  • improve accountability to the community; and
  • establish performance trends over time.

The framework will provide councils, individually and collectively, with:

  • practical tools to measure and compare results against agreed performance outcomes and best practice standards;
  • targets and strategies for councils to continuously innovate and improve the performance of their functions, including efficient and effective service provision and operations; and
  • synergies to expand councils' capacities to produce better economic, social and environmental outcomes for residents and the community.

The Commonwealth Government provided a grant of $55,000 under the Local Government Incentive Programme to help implement the performance measurement system. A project steering committee (the KPI Committee) comprising State and local government officers and the Chairperson of the Local Government Board was established to oversee introduction of the performance measurement system for Tasmanian councils.

The KPI Committee refined the performance indicators developed by the KPI Steering Committee in 1999. Council performance will be measured by 50 KPIs in the 1999-2000 report. All 29 Tasmanian councils provided their data on a voluntary basis. The project has been, and will continue to be, a joint effort of both State and local government. There is strong support for the measurement system from local government.

The State Government, through its initiative funding, has allocated sufficient resources to ensure successful implementation and ongoing operation of the KPI framework. The data collection form developed for the project seeks to include not only the data for the KPI project but also existing data from the Australian Bureau of Statistics, the State Grants Commission and the Department of Treasury and Finance.

Customer satisfaction with council services is an important indicator. To satisfy this need the Committee is developing a community opinion survey that can be used by all councils and adapted for their particular requirements. The first report, Measuring Council Performance In Tasmania 1999-2000, was due to be released on 1 October 2001. The report for 2000-01 is due for release by 31 December 2001.

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Northern Territory

The aim of the Northern Territory performance indicators programme is to introduce performance management tools to all councils in the Territory in such a way as to ensure that they become an integrated and valuable part of community management practices. In support of this aim, the Department of Local Government has linked the development and implementation of performance indicators for local governing bodies to the introduction of its best practice programme.

While reporting of performance information is well within the capacity of the municipal and larger councils, it is recognised that the capacity to provide this information is more difficult for the smaller and more remote councils. Consequently, the performance indicators programme consists of two streams.

The municipal and larger councils, which comprise the first stream, collected a full set of quantitative performance information on the three identified core services - roads, waste management and community management. The second stream, consisting of the smaller and more remote councils, is less advanced.

During 1999-2000, 42 councils in the Northern Territory were invited to participate in the local government performance programme and returned comparative data. This year all councils were invited to participate. However, 30 councils failed to return their surveys. Of the 30 councils, most have identified a number of reasons for not providing the required data.

The third annual report is currently being prepared for publication. Performance indicators highlight differences between councils for specific activities but do not explain why these differences may have occurred. For this reason, contextual and descriptive information for each participating council was collected and includes explanations of the circumstances and results provided by the councils themselves.

The report will not provide benchmarks against which to assess 'satisfactory' performance. Instead, contextual information is being provided that will help councils identify similar councils against which their performance may be assessed.

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Australian Capital Territory

The Australian Capital Territory reports the following measures taken in the Territory in 2000-01 to improve the efficiency and effectiveness in delivering local government-type services to the Territory community. This includes progress in developing comparable performance measures.

ACT Waste Management

Measures undertaken by ACT NOWaste include:

  • implementation of an improved reporting system for missed waste and recyclables collection services; and
  • completion of a costing study which identified the full cost of waste disposal in the Territory.

Canberra Urban Parks and Places

In 2000-01, Canberra Urban Parks and Places, as the purchaser of park and public place maintenance services, continued to focus on improving the efficiency and effectiveness of delivery of services by:

  • undertaking the annual customer satisfaction survey from which service improvement programmes are designed;
  • initiating a benchmarking project with a number of comparable municipal authorities in New South Wales, Victoria, and Queensland - initial results are expected in September 2001; and
  • continuing reviews of contract management procedures.

ACT Roads

The ACT Roads unit within the Department of Urban Services has been undertaking benchmarking analysis since 1999. It comprises two components: Performance Benchmarking and Process Benchmarking.

Performance benchmarking undertaken in 1999 compared the cost efficiency of the management functions of various asset categories (local roads, arterial roads, bridges, traffic lights, signs, line marking, community paths, streetlights and stormwater assets) by establishing over 50 performance indicators. The benchmarking partners included two State road authorities and two Local Government Authorities that are of comparable Australian Classification of Local Government category.

Additional analysis was also undertaken on the more significant cost items, such as arterial and local road maintenance. Unit rates for arterial roads were compared with five regions of a comparable State road agency. Similarly, unit rates for local road maintenance were compared with 23 Local Government Authorities.

In 2000, the performance indicators were aggregated to concentrate on fewer indicators in order to illustrate the cost efficiencies of asset creation and asset maintenance activities. This project included one State Government partner and two comparable Local Government Authorities. The results confirmed the previous findings with a recommendation to undertake further detailed analysis on asset maintenance funding levels.

Process benchmarking analysis was undertaken with the same partners in order to identify continuous improvement opportunities for specific areas. The key areas considered for the analysis were Capital Works Procurement and Contract Management.

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