Post on 17-Jan-2016
Regional Workshop
22/09/2015 Cairns
1. An introduction to Better Councils Better Communities campaign 2. A performance reporting discussion with participants3. 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.
4. Benchmarking in Ready. Set. Go.• Benchmarking methodology• Macro benchmarking themes for QLD local governments in
Ready. Set. Go.5. The next steps for Ready. Set. Go.6. Workshop: the future direction of Ready. Set. Go. Participants to
shape what they need in a performance benchmarking tool
Workshop agenda
Better Councils,
Better Communities.
Two Driving Issues:
Money / Financial Sustainability
Community Perceptions & Attitudes
Growing funding gap, currently $800m pa.
Why is there a need for the campaign?
> Queensland Government: Whole of Government Service Delivery Research
QLD Believe: 1Morning TQueenslanders’ Believe …
63%believe that
… local government is an essential layer of government.
BUT ONLY
… councils deliver value for money3/10believe that
Queenslanders’ Believe …
… they are satisfied with their council.
… councils look for ways to improve productivity and efficiency.
3/10believe that
BUT ONLY
70%believe that
Council People BelieveMorning TeaLocal Government People Believe …
… we look to ways to improve productivity and efficiency.
… it is important to be able to compare financial performance with other councils.
7/10believe that
47%believe that
35%believe that
… we deliver value for money.
Five Features of the Campaign:
Benchmarking: 2
Provide comparative data of council performance in a practical, useful and engaging way.
No public release of individual council data until after 2016, and further consultation with Members.
Utilise existing data already in the public realm, no additional administrative burden on councils.
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.
Benchmarking: 3
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.
Other Supporting Services.
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?
Introduction to performance benchmarking
Key performance indicatorsHow performance benchmarking is measured
Sources of data
Benchmarking groupsHow councils are grouped for comparisons
What is the information telling us
Understanding performance benchmarking in Ready. Set. Go.
Key performance indicators
General Sustainability Revenue Efficiency Service level
Ready. Set. Go. Features 24 key performance indicators from 5 categories:
PopulationPopulation densityAverage ageGross regional productGRP per capitaAvg. persons per householdAvg. weekly householdincome
Operating Surplus RatioNet Financial Liabilities Ratio
Asset Sustainability RatioWorking Capital Ratio
Debt per capita
Rating effortReliance on rates & charges
Reliance on contract worksReliance on operational grants
Operating Expenditure per capitaEmployee costs as % of operating expenditure
Time lost to accidents per employeePopulation serviced per employee
Asset Consumption RatioCRC of asset base per capita
Urban road length serviced per capitaUrban road length serviced per capitaTotal road length serviced per capita
Parks area serviced per capitaLibrary issues per capita
Key performance indicators
Targets and Importance
TargetsTargets can be either: •Best practice as described by the relevant government department•A peer group average for perspective•A target set by the user
ImportanceThe relative importance of a key performance indicator is
denoted by the star symbol in Ready. Set. Go.
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)QAODLG Comparative InformationABSAEC GRPOther (e.g. SLQ)
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
Key performance indicators
Key performance indicator application in Ready. Set. Go.
KPIs
KPI explorer
Trend
Compare
Overview of council key performance indicators by category
Dashboard view of council key performance indicators
Historical comparisons of multiple key performance indicators
Benchmark individual key performance indicators against peers
Key performance indicators
Financial sustainability review exercise in Ready. Set. Go.
Key performance indicators
Financial sustainability review in Ready. Set. Go.
Excerise material
Aec to demo other combos or talk Requests from participants
Key performance indicators
Financial sustainability review in Ready. Set. Go.
Excerise material
Aec to demo other combos or talk Requests from participants
Key performance indicators
Financial sustainability review in Ready. Set. Go.
Excerise material
Aec to demo other combos or talk Requests from participants
Key performance indicators
Financial sustainability review in Ready. Set. Go.
Excerise material
Aec to demo other combos or talk Requests from participants
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
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
Workshop question
Do you look to the performance of similar councils?
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
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
Performance Benchmarking
How to access benchmarking functionality in Ready. Set. Go.
Performance Benchmarking
What is performance benchmarking telling us?
-30%
-25%
-20%
-15%
-10%
-5%
0%
5%
10%
15%
Indigenous Rural /Remote
Rural /Regional
Resources Coastal SEQ QLDAVERAGE
2004/05 2005/06 2006/07 2007/08 2008/09 2009/10 2010/11 2011/12
Operating Surplus Ratio (prior report)
Indigenous and SEQ segments found to be experiencing persistent deficits (on average across each segment)
Performance Benchmarking
What is performance benchmarking telling us?
Indigenous and SEQ segments found to be experiencing persistent deficits (on average across each segment)
Operating Surplus Ratio 2010 - 2011
Performance Benchmarking
What is performance benchmarking telling us?
Operating Surplus Ratio 2013 - 2014
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
Performance Benchmarking
What is performance benchmarking telling us?
Coastal and SEQ segments found to be experiencing heightened funding pressures (on average across each segment)
-80%
-60%
-40%
-20%
0%
20%
40%
60%
80%
Indigenous Rural /Remote
Rural /Regional
Resources Coastal SEQ QLDAVERAGE
2004/05 2005/06 2006/07 2007/08 2008/09 2009/10 2010/11 2011/12
Net Financial LiabilitiesRatio(prior report)
Performance Benchmarking
What is performance benchmarking telling us?
Net Financial Liabilities Ratio2010 - 2011
Performance Benchmarking
What is performance benchmarking telling us?
Net Financial Liabilities Ratio2013 - 2014
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
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
Performance Benchmarking
Debt per capita ~ Coastal Councils 2013 - 2014
What is performance benchmarking telling us:Debt per capita
Performance Benchmarking
What is performance benchmarking telling us:Debt per capita
Coastal (example low)
Performance Benchmarking
What is performance benchmarking telling us:Debt per capita
Coastal (example low)Coastal (example high)
Performance Benchmarking
What is performance benchmarking telling us:Rating Effort Ratio
Provides a good indicator of council’s ‘tax take’ from the local economy
Low outcome suggests that councils may not be maximising their own source
revenue
High outcome suggests that councils may be extracting too much income from the
local economy
Performance Benchmarking
What is performance benchmarking telling us:Rating Effort Ratio
Rating Effort Ratio ~ Rural Regional Councils
Performance Benchmarking
What is performance benchmarking telling us:Contribution of employee costs to council operating costs (excluding depreciation and interest)
Provides an indicator of the contribution of employee costs to total council operating
costs
Performance Benchmarking
What is performance benchmarking telling us:Rating Effort Ratio
Contribution of employee costs to council operating costs
Performance Benchmarking
What is performance benchmarking telling us:Asset Base per capita
Provides a good indicator of council’s investment in local assets (and renewal
obligations) relative to its population base
Performance Benchmarking
What is performance benchmarking telling us:Asset Base per capita
Asset Base per capita ~ Rural/Remote Councils 2010 - 2011
Performance Benchmarking
What is performance benchmarking telling us:Asset Base per capita
Asset Base per capita ~ Rural/Remote Councils 2013 – 2014
Workshop question
[Question about peoples own experiences with these findings]
Next steps for Ready. Set. Go.
Recent
Tranche 2 indicators released
Upcoming
Tranche 3 indicators14/15 data points
Forward estimate/ 10 year plan figures can be added
Workshop question
The future direction of the tool
What indicators would you like to see?
What other functionality could be included in Ready. Set. Go.
Ready. Set. Go. is specifically built for QLD LGYour feedback will help shape this tools future
What would you like to benchmark?
Regional Workshop
22/09/2015 Cairns