The Future of Local Government

LGMA Congress

Last week I attended the LGMA (Local Government Managers Australia) National Congress in Darwin. I was among more than 300 delegates and was privileged to lead two sessions about Smart Cities and the newly launched LG Excellence Awards. It was an interesting Congress with the future of the sector being hotly debated and the state of government as a whole being examined.

The local government sector is going through a period of intense scrutiny and self-exploration at the moment. State and Federal government – who provide most of the funding and define the regulations for councils – have been pressing for reform and amalgamations. The prevalent thinking is that there are too many councils around the country to be viable. With over 500 councils around Australia, there may be some truth to this.

Local government reform processes in the recent past have been met with mixed success at best. Forced amalgamations in QLD are now being – at least partially – reversed. The reform process in WA came to a grinding halt a few months ago after millions of dollars in expenditure to prepare for amalgamations. Tony Simpson – WA Minister for Local Government; Community Services; Seniors and Volunteering; Youth – was at the LGMA Congress and candidly said that it simply got too hard to continue with the reforms when there was so much resistance. Instead of mandated amalgamations, WA is now encouraging voluntary amalgamations, with change being uncertain.

The state government in NSW recently initiated a reform process starting with the ‘Fit for the Future’ submissions that all Councils have been asked to prepare. Each Council has been asked to explore whether their organisation is structured and able to meet the future needs of the community they serve. The submissions are due by the end of May and have largely been completed by most councils. The next stages in the NSW reform process are unclear and will be partially dependent on the submissions.

It is important to avoid some of the past failures. I had the opportunity to speak with several Councillors from WA at the LGMA Congress and ask what NSW could learn from the process. All said that lack of consultation, and the absence of a clear process, were the main shortcomings of the WA process. Too great a focus on forced amalgamations was identified as another issue.

Having worked with over 30 local councils over the last five years, I am a firm believer that the sector needs to be reformed. I also believe that local government is a critical tier of government and needs to play a key leadership role in preparing Australia to face its future challenges. The reform, however, needs to be led by the local government sector itself, rather than being forced by state or federal government. State and Federal governments are simply not providing sufficient guidance; they may not have the knowledge to provide that guidance. The sector has a unique opportunity to take the lead. The LGMA and similar sector bodies have an important role to play in leading this conversation.

LG Excellence Awards and their relevance to the reform discussion

The main reason I attended the LGMA National Congress was to sign a Memorandum of Understanding between the LGMA and the Australian Organisational Excellence Foundation (the Foundation). The MOU provides the parameters of an agreement to establish a tailored Awards process for Councils using criteria drawn from Excellence Models. The expectation is that the criteria and process will be developed over the next six months, with the Awards being opened for applications from January 2016.

The primary intent of these Awards is to encourage councils to adopt Excellence Models and practices that will benefit and promote much needed change. An Excellence Model provides a leadership and governance framework that guides councils in sustaining performance by delivering improving outcomes to its diverse stakeholders (the community, staff, businesses, government etc.). Councils that leverage Excellence Models derive many benefits including: engaged staff, financial rigour, efficient processes, reduced operating costs, improvement focused behaviour, relevant service delivery and greater intimacy with the community they serve.

Although many Australian councils (estimated by the Foundation to be between 70 and 90) already use Excellence Models to guide their decision-making, the development of criteria that is tailored to the local government sector will make it easier for councils to embrace Excellence Models. This tailored criteria will enable a more palatable interpretation of excellence paradigms into the specific needs of a council. I also expect that the criteria will be developed in a way that caters for councils of all sizes and nature.

The criteria will also provide additional benefits to the sector by providing a basis for benchmarking performance, knowledge sharing and capability development. If the sector is bold, the criteria can also provide invaluable guidance in exploring collaboration and even amalgamation. This boldness is essential and the LG Excellence Awards may be a first step in leveraging the power of Excellence Models to guide reform.

What are Smart Cities and what is their relevance to the future of the sector?

As great a priority as it is to improve a council’s operating structure is the need to develop the infrastructure that effectively caters for the communities of the future. This is the essence of a Smart City; not only does the council need to be effective and efficient; it also needs to lead the development of future infrastructure. Australia is rapidly falling behind the rest of the world, and particularly Asia. A few days ago the Indian cabinet approved a key initiative to invest in 100 Smart Cities around the country. Countries like China and South Korea have been heavily investing in Smart Cities for years and maybe decades. In Australia, the only real conversation about the infrastructure of the future has been about the National Broadband Network (NBN). Even that investment is mired in controversy.

Australian councils need to explore how today’s (and in some cases yesterday’s) capabilities can be leveraged to support and engage more effectively with the community. A Smart City looks at how a rural council can drive local employment by setting up community hubs that enable people to live and work without relocating to bigger cities. A Smart City looks at how building codes can be changed to optimise energy efficiency. A Smart City looks at how community co-creation can be enabled to drive innovation not only in the council’s service, but the community as a whole. A Smart City looks at how data can be shared and leveraged to provide more tailored and relevant services to the community.

The session I led on Smart Cities at the LGMA Congress featured Martin Daffner – an innovation specialist currently based in Shanghai. Martin spoke about key examples of Smart City investment internationally and the community benefits derived. The session participants didn’t disagree with the importance of exploring this concept, but there was a general feeling that there may be a lack of knowledge among councils as to where to start.

It is important to remove the fear factor associated with Smart Cities. A Smart City isn’t always about creating new infrastructure. Leveraging Smart City thinking does not always require massive investment. Creative thinking can allow Australian councils to leverage existing infrastructure to deliver many of the benefits and features of Smart Cities to their communities. Australian councils can also leverage from the international learnings and expertise in the subject. Bold investment in infrastructure is also needed and councils have a role to play in defining the community needs and collaborating with state and federal governments to deliver this infrastructure.

The Future of the Sector

There is little doubt in my mind that the sector is in desperate need of reform and change however the reform needs to be driven by the sector itself rather than imposed. If the sector does not boldly seize the opportunity, reform will be imposed by state and federal governments. The adoption of Excellence Models and exploring Smart City concepts are only two of the key priorities in the reform discussion. However, they may be the most appropriate starting points.

For further information about the LG Excellence Awards or Smart Cities, feel free to contact Ravi by emailing RaviF@thriveplus.com.au.

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